Experiences that the value of deposits has been reduced to 1/100 billion by hyperinflation

In Germany after World War I, the value of Marc fell sharply, causing inflation enough to sell a loaf of bread for 1 trillion Marc. Such rapid inflation is called ' hyperinflation ', and in recent years, hyperinflation in Zimbabwe, where ultra-high-value banknotes of '100 trillion Zimbabwe dollars' were issued, is particularly famous. Argentine bank deposit records that experienced such hyperinflation in the 1980s and 2000s have become a hot topic.

I am visiting my mother in Argentina. I found this thing. Prepare for a fantastic lesson about the power of inflation. Pic.twitter.com/Yf3TTxOP5p

— Diego Basch (@dbasch) April 17, 2022

The deposit record was published by Argentine-born investor Diego Basch . The deposit record records a total of 1228 pesos deposited between August 6th and October 29th, 1976. The value of this amount of 1228 pesos has decreased year by year due to hyperinflation. As of 1976, the peso was exactly called ' Peso Ley '.

First stamp is from August 6th, 1976. Last one is from October 29th. A total of 1228 pesos. How much would you think that money is worth today? What could you buy? Pic.twitter.com/LQbYVEBBp0

— Diego Basch (@dbasch) April 17, 2022

In 1983, seven years after Basch deposited 1228 pesos, the Argentine government issued a currency called ' Peso argentino '. 1 Argentine peso (bottom) is worth 10,000 pesos lei (top), at which point Basch's deposit was 0.1228 Argentine pesos.

Then, in 1985, a currency called ' Austral ' was issued. Since one austral is equivalent to 1000 Argentine pesos, Mr. Basch's deposit was 0.0001228 austral.

Furthermore, in 1995, a reform was implemented to reduce 10,000 australs (top) to 1 peso (bottom). As a result, Mr. Basch's deposit was 0.00000001228 pesos. At the time of writing the article, the peso is used as a currency unit in Argentina, but since the currency named 'peso' is also distributed in countries other than Argentina, 'Argentine peso' and 'peso algentino' Sometimes called.

Based on the currency transitions mentioned above, Basch estimates that the 1228 pesos deposited in 1976 are now equivalent to $ 0.00000006.

So, those 1228 pesos from 1976 need to be divided by 10 ^ 11 to convert them to current pesos. Then again by 200 to convert to USD. So if I'm not mistaken, that's about 60 picodollars. Of course no interest was paid ..

— Diego Basch (@dbasch) April 17, 2022

Also, since 1 g of gold is traded for about 60 dollars, the deposit is worth 1 picogram of gold.

What can you buy with 60 picodollars? One gram of gold is about $ 60 these days, so you could buy one picogram. We could do better with copper, which is about 600 times cheaper. Still, I couldn't buy a nanogram of copper ..

— Diego Basch (@dbasch) April 17, 2022

Regarding the plunge in currency value due to this hyperinflation, Basch said, 'Exponential changes allow you to get the world and sometimes dilute it into nanoparticles. Exponential changes. I hope that will work in everyone's favor. '

Takeaway: may the sign of the exponential be ever in your favor. Positive, you own the world. Negative, you get diluted into nanoparticles.

— Diego Basch (@dbasch) April 17, 2022