Sunday, January 17, 2010

Hyperinflation Red Flag Zone

A global fiasco is brewing in Japan
Ambrose Evans-Pritchard
January 12th, 2010 15:09

While most economists are more concerned with deflation rather than inflation at this point, this article posits that Japan has been in the hyperinflation red zone for an extended period and the US just entered the red zone this year. The red flag zone was coined by Perter Bernholz in his book, "Monetary Regimes and Inflation." The red zone is the tendency for prices to spiral when deficits as a share of government expenditure rise above a third and stay there for several years.

No comments: