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Grains, Gold, and, oil manifesting something sinister the world economies especially the emerging economies can face hyperinflation
Marla Guthrie
Oct. 5, 2007
We did not hear that term for along time. But the fact that food prices, grains, gold and oil are all rallying at the same time, it is worrisome. The wages in China and India are doubling every two years. The price of wheat doubled in the four months. The gold and oil are tracing unbounded territories. The seeds of hyperinflation are here.
In the last two hundred years, three times the world faced markets where food, gold and energy rallied simultaneously. Each time the local economies felt the effects of hyperinflation within twelve months. The wage inflation normally comes slower than the commodity inflation.
What is more sinister, all the time, the economies went into depression after hyperinflation. The hyperinflation caused financial meltdown. After that the economy has no place to go when Governments do not have liquid reserves to halt the meltdown.
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