On The Path To Hyperinflation

 If someone had told me in the early 2000s that in in the 2010s, central banks, led by the Federal Reserve, would be buying hundreds of billions' worth of government bonds each month, I would have wished him/her a nice trip to an asylum.

The Federal Reserve started the asset purchases on Nov. 25, 2008, and slowly but surely all major central banks followed.

In 2020, the size of the combined balance sheet of the four largest central banks-the Bank of Japan, the Federal Reserve, the European Central Bank, and the People's Bank of China-reached an insane 32 percent of the gross domestic product of the world.

A figure presenting the balance sheet of the four largest central banks as a share of the gross domestic product of the world.

The creation of vast amounts of central bank credit.

In the process of monetization, a central bank usually buys the debt issued by the finance ministry, and the central bank then nullifies the value of the bonds, which creates a loss, which is then covered by issuing new currency notes to reconcile its balance sheet, which increases money in circulation.

As inflation accelerates, consumers, firms, and workers start to expect ever-higher inflation, which, combined with the quickly increasing supply of money from the central bank, destroys public faith in the currency.

https://www.theepochtimes.com/on-the-path-to-hyperinflation_4782143.html