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Highlights
- Twitter CEO , Jack Dorsey, has announced some unique predictions that economists globally are now pondering upon.
- Under hyperinflation, the prices of goods and services increase uncontrollably.
- However, it is too early to say if the world economy is about to enter a state of hyperinflation.
As the world economy recovers from the chuckles of the COVID-19 pandemic, markets are finally moving towards better demand and sustainability. Of course, in the phase of revival, no one expects a high rate of inflation. However, Twitter CEO has announced some unique predictions that economists globally are now pondering upon.
Jack Dorsey, Twitter CEO, has recently tweeted that hyperinflation is soon going to hit the US and the rest of the world as well.
What is hyperinflation, and what will happen if it occurs in the global market?
Hyperinflation is the father figure for inflation. It is the market condition when the prices of the goods and services increase tremendously. Additionally, when hyperinflation hits, it usually stays for a sustained time.
Jack Dorsey: Hyperinflation to hit the US & the world
So, let’s say if hyperinflation happens. Then what? - Under hyperinflation, the prices of goods and services increase uncontrollably. Consequently, buyers and sellers need more money to trade in the market.
As a result, people start hoarding goods, including perishable food items, which in turn causes food supply shortages and related issues. In addition, there are several other macro-level consequences that an economy bears under hyperinflation.
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What did Dorsey tweet, and what’s the basis?
On October 22, Jack Dorsey tweeted: “Hyperinflation is going to change everything. It’s happening.” He further added, “It will happen in the US soon, and so the world.”
The Twitter CEO tweeted about hyperinflation because consumer price inflation is running at almost a 30-year high in the US. Additionally, economists are now concerned that the problem can get worse in the coming months.
Jack Dorsey: Hyperinflation to hit the US & the world
This comes as a massive surprise as policymakers didn’t predict such market fluctuations. Several economists are now predicting that inflation is likely to stay longer than expected previously and can stay up till next year.
What do the other opinions look like?
Following Dorsey’s tweets, several economists have shown their concerns worldwide. However, many have views dissimilar to those of Dorsey’s. For example, some have said that the current situation falls under higher inflation and not hyperinflation. While some are saying, the present scenario is nowhere close to hyperinflation.
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Bottom line
It is hard to imagine the world economy to hit a state of hyperinflation in the revival times. No policymaker or economist had predicted such a state. However, Dorsey’s comments have stimulated economists worldwide to reconsider the market fluctuations. But it is too early to say if the world economy is about to enter a state of hyperinflation.
