Placeholder Image

字幕表 動画を再生する

  • Jacob: I'm Jacob Clifford. Adriene: And I'm Adriene Hill.

  • Jacob: And today, finally, Crash Course, is gonna live up to its name. We're gonna talk

  • about crashes - economic crashes.

  • Adriene: Crash Course - we've been waiting for this!

  • [Theme Music]

  • Adriene: In Germany in 1923, people were doing strange things like using money to wallpaper

  • their houses and burning money for heat. What was going on? Had they all gone crazy?

  • Nope! In the early 1920's, Germany was in the grip of something called hyperinflation.

  • In order to pay massive reparations to the Allies after World War I, Germany printed

  • a lot of their currency - the Mark.

  • One result of all this additional money was higher and higher prices. By November 1923,

  • it took a trillion marks to buy one U.S. dollar.

  • There were one thousand billion mark notes in circulation. The mark was effectively meaningless.

  • A similar situation developed in Zimbabwe a few years ago. Starting in 2007, inflation

  • grew rapidly, like really really rapidly. By September 2008, the International Monetary

  • Fund estimated the annual inflation rate at 489 billion percent.

  • In practical terms, the Zimbabwean dollar lost 99.9% of its value between 2007 and 2008.

  • It's hard to even imagine what that looks like. Prices nearly doubled every 24 hours

  • and businesses revised prices several times a day.

  • In June 2008, The Economic Times reported that, "A loaf of bread now cost what 12 new cards did a decade ago."

  • The government issued currency in huge denominations to keep up with rising prices. The million

  • dollar bill, the billion dollar bill, and finally in 2009, the hundred trillion dollar

  • bill - the largest denomination of currency ever issued. The good news

  • was that everyone was a billionaire. But the bad news was that those dollars were virtually worthless.

  • Jacob: One definition of hyperinflation is when a country experiences a monthly inflation

  • rate of over 50% or around 13,000% annual inflation.

  • But believe it or not, Zimbabwe's recent inflation isn't unique, and it's not the worst inflation in history.

  • In fact the worst was in Hungary in 1946. Between July 1945 and August 1946, the price

  • level in Hungary rose by a factor of three times ten to the twenty-fifth. And yes, any

  • time you have to express your inflation rate using scientific notation, that's a bad thing.

  • Besides the obvious confusion over what prices to charge for things, why is hyperinflation so bad?

  • Well inflation, and especially hyperinflation, erodes wealth. In Zimbabwe, people who had

  • worked their whole lives and saved up for retirement, saw their savings just wiped out.

  • Extreme inflation also forces people to spend as quickly as possible rather than save or

  • lend, so there is no money available to fund new businesses. And all that uncertainty limits

  • foreign investment and trade.

  • So, hyperinflation is bad. But how does it happen? Let's go to the Thought Bubble.

  • Adriene: So, we're simplifying this stuff a lot. But the root of the problem in both Weimar Germany

  • and Zimbabwe was that the government was paying their bills by printing new money.

  • An increase in the money supply can have two effects. It can increase output or increase

  • prices or some combination of the two. Inflation starts when output is pushed to capacity and

  • can't rise much further, but policy makers continue to increase the money supply.

  • In theory, once output is maximized, the more money you print, the more inflation you'll get. Simple, right?

  • Well, that doesn't fully explain why Germany's or Zimbabwe's inflation rose exponentially.

  • Was the government really printing that much money? Not exactly.

  • After a couple years of doubling prices, people started to expect high inflation, and that

  • changed their behavior. Say you're planning to buy a new refrigerator, and you expect

  • prices to rise quickly. You buy it as soon as possible before the price has had a chance

  • to change. But with everyone following that logic, dollars start to circulate faster and

  • faster and faster.

  • Economists called the number of times a dollar is spent per year the velocity of money. When

  • people spend their money as quickly as they get it, that increases velocity, which pushes

  • inflation up even faster.

  • You get a vicious cycle of higher prices, which lead to expectations of higher prices,

  • which lead to higher prices.

  • The hyperinflation in Germany ended when the government replaced the worthless mark with

  • a new currency. Zimbabwe ended its hyperinflation by abandoning its currency altogether. Now,

  • its citizens use U.S. dollars or currencies from neighboring countries.

  • The good news is that prices have since stabilized and real GDP has begun to increase.

  • Jacob: Thanks Thought Bubble.

  • So, if you ever control a national economy, try to avoid hyperinflation. You might also

  • want to stay away from depressions.

  • A depression is kind of a hard thing to define, but basically it's when real GP falls and

  • keeps falling for a long period of time. This has all sorts of terrible effects like high

  • unemployment and falling prices.

  • Before the 1930's, economists use the term depression to describe sustained falls in

  • GDP. But after The Great Depression, economists started using the word recession for downturns

  • to avoid association with the 1930's.

  • I guess calling it a depression was just too depressing.

  • When the stock market crashed in 1929, it didn't just cause problems for stock brokers.

  • Everyone freaked out and stopped spending, and the economy ground to a halt.

  • Of course, that's not the only reason for The Great Depression. Actually, there's still

  • a lot of debate about the causes.

  • Anyway, when economies fall into deep recessions, there are more workers than there are jobs

  • and more output than consumers want to buy. So both income and prices fall.

  • Central banks can try to use Expansionary Monetary Policy to speed up the economy. So

  • for example, in the U.S. The Federal Reserve can lower interest rates. This encourages

  • consumers and businesses to take out loans, and hopefully, get the economy going again.

  • But if people start changing their expectations and anticipate further price declines, they'll

  • change their behavior in ways that work against the central bank.

  • Like, if you're planning to buy a refrigerator and you expect prices to fall, you're gonna

  • wait to get a lower price. But, if everyone follows that same logic, then spending declines

  • and so does the velocity of money.

  • That leads to further price declines and a vicious cycle of falling prices, which leads

  • to expectations of lower prices, which actually leads to lower prices. It also leads to layoffs

  • at the refrigerator factory and so on and so on and so on.

  • This is called a liquidity trap and some economists believe it's a worsening factor in economic

  • downturns including The Great Depression.

  • Adriene: Speaking of The Great Depression, after the initial crash of 1929, The Federal

  • Reserve dropped interest rates to zero, output and prices fell, and regular people started

  • to expect further price declines. Unemployment rose to 25%, and the average family income

  • dropped by around 40%.

  • This is...not great. Once interest rates hit zero, and prices were still falling, the central

  • bank was in a bind. Continuing deflation meant that borrowing money was a bad deal, even with no interest.

  • The money you pay back in the future would have more buying power than the money you

  • originally borrowed. This discouraged people from buying homes or cars and discouraged

  • businesses from borrowing to expand capacity.

  • In fact, getting out of The Depression took nearly a decade. And it wasn't really monetary

  • policy that put an end to it. It was the massive government spending of World War II.

  • Okay, you don't want hyperinflation. You don't want depressions. You also don't want stagflation.

  • That's when output slows down or stops or stagnates at the same time that prices rise.

  • So, stagnant economy plus inflation equals stagflation. Get it? It's a portmanteau.

  • Jacob: The U.S. experienced stagflation starting in the 1970's, after a series of supply shocks

  • including a rise in oil prices and, believe it or not, a die-off of Peruvian anchovies, which were important

  • for animal feed and fertilizers. This combination of events meant the economy couldn't produce as much.

  • The Fed tried to address this by boosting the money supply and cutting interest rates,

  • but output couldn't rise much because of low productivity and the oil shortage. So, all

  • that extra money just triggered inflation.

  • It got even worse when people began to adjust their inflation expectations. Businesses started to expect

  • costs to rise even further, so they laid off workers, and that put the economy back into a recession.

  • When The Fed boosted the money supply again, that raised inflation expectations even more.

  • This ended in the early 80's when a new Federal Reserve Chairman took over. His name was Paul

  • Volcker. He actually cut the money supply and raised interest rates dramatically.

  • Output plummeted, and unemployment reached ten percent, but prices stopped rising and

  • so did inflation expectations.

  • The economy gradually recovered, and Paul Volcker got the credit for ending stagflation.

  • So hyperinflation, deflation, depression, stagflation - they're all extreme economic

  • circumstances, but these extremes show us why it's so important to measure and understand the overall economy.

  • In some cases, government action or inaction made things worse. And in other cases, the

  • government helped the economy get back on its feet.

  • But it's important to keep in mind that the economy is made up of collective decisions of individuals.

  • It's people like us, our expectations matter. If enough people fear a recession, they're

  • gonna decrease their spending, and that's gonna cause a recession.

  • Adriene: Next week, we're gonna look at different economic schools of thought. But regardless

  • of philosophy, policies designed to steer the economy need to address expectations and

  • focus on creating confidence.

  • Jacob: Thanks for watching. We'll see you next week.

  • Thanks for watching Crash Course Economics. It's made with the help of all these awesome

  • people. You can help keep Crash Course free, for everyone, forever by supporting it at

  • Patreon. Patreon is a voluntary subscription service where you can support the show with

  • a monthly contribution. We'd also like to thank our High Chancellor of Learning, Dr.

  • Brett Henderson and our Headmaster of Learning, Linea Boyev. Also, our Crash Course Vice Principals,

  • Cathy and Tim Phillip.

  • Thanks for watching! DFTBA

Jacob: I'm Jacob Clifford. Adriene: And I'm Adriene Hill.

字幕と単語

ワンタップで英和辞典検索 単語をクリックすると、意味が表示されます

B1 中級

リセッション、ハイパーインフレ、スタグフレーション。クラッシュコースEcon #13 (Recession, Hyperinflation, and Stagflation: Crash Course Econ #13)

  • 44 12
    Jane に公開 2021 年 01 月 14 日
動画の中の単語