Could the U.S. experience hyperinflation like that experienced in the Weimar Republic of Germany in the 1920s?
BL: I don’t think there will be hyperinflation in the U.S. There are really two types of inflation—price and monetary. Price inflation is not the cause, but rather the symptom of monetary inflation—just too much currency out there chasing too little goods. We don’t need to have as high a level of price inflation as we had in the 1970s to see commodities and gold rise in value. In fact, I don’t think there will be that level of price inflation because, unlike the 1970s, we have export economies like China, Thailand, Vietnam and India with very low labor costs that are restraining the Consumer Price Index (CPI). We can go to Wal-Mart or Costco and buy items at much lower prices compared to the options available to us in the 1970s. That directly impacts price inflation. TGR: What effect will an export economy like China’s have over the next year or two? BL: I think China will have a significant and prominent influence. The rebound in Asia has been a remarkable story. The rest of the world
