Hyperinflation
Germany is an example of what happens when the government prints too much money to pump up the economy. Pumping up is another way of saying preventing deflation. (See my recent post about how much money the Fed is creating to keep the financial system propped up.)
We should not ignore the extreme hyperinflation of Germany in the 1920’s as an example of how bad things can become when inflation gets out of control. In January 1919 an ounce of gold cost 170 German marks. Less than five years later, the same ounce cost 87 billion marks. The hyperinflation affected everything, even postage stamps. For example, in 1923 a stamp originally issued for 300 marks was overstamped with a revised value of 2 million marks.
Source: The Demise of the Dollar by Addison Wiggin. New Jersey, John Wiley & Sons, Inc. 2008, pg. 145.
Is hyperinflation in our future?
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