Friday, July 15, 2011

Money to burn in Weimar's post war “monetization”

House of Representatives candidate sees parallel with today

Germany tried to “monetize” its World War One reparations debt through hyperinflation during the period after the victors imposed reparations on the struggling Weimar Republic.

In the last few days before Adolf Hitler and the Nazi Party seized power in 1933, it was actually cheaper to burn Reichsmarks as fuel for heating than it was to use it to buy fire wood to burn for the same purpose.

At the time, for each 1% raised in taxes, 99% was hyperinflated fiat currency.

We caught up with Constitutionalist candidate for U.S. House of Representatives District 25 Wes Riddle at his office in Belton.

Mr. Riddle is a retired Colonel of the U.S. Army and a historian trained at Oxford University who has taught history at two area universities.

Asked if there are any historical events that parallel those of today, Col. Riddle said that the current debt crisis, the U.S. Treasury's policy of monetizing its debt to China, and the fact that German bond ratings have already declared U.S. Treasury bonds in default remind him of depression-era conditions in the Weimar Republic.

Unlike Germany's Weimar Republic, America seems to have won the war, but lost the peace.

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