The other lunchtime question was, "In a country experiencing hyperinflation, what happens to the coins?" My guess was that because their metal value would very quickly exceed it's face value, they would quickly disappear from circulation.
About half way down the Wikipedia page is the section "Hyperinflation and the currency" that states, "Metallic coins were rapid casualties of hyperinflation, as the scrap value of metal enormously exceeded the face value. Massive amounts of coinage were melted down, usually illicitly, and exported for hard currency."
Give it up for deductive reasoning! ;-)
Thursday, July 17, 2008
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