Jeopardy’s Defective Understanding of Inflation
Should we call this reverse monetarism?
An “answer” in the July 1 episode of Jeopardy was the following:
In the 1940s, this country’s Magyar Nemzeti Bank printed the million billion pengo note to fight inflation.
The contestants were expected to say, and one did, “What is Hungary?”
The problem, of course, is that you don’t fight inflation by adding a huge amount to the money supply; that creates more inflation. The people who come up with the clues are obviously smart and I don’t expect them to know a lot of economics, but how would one think that printing more money “fights” inflation rather than adding to it? I don’t understand their mental model.
One of my favorite articles on hyperinflations, not surprisingly, is the one I commissioned for my Concise Encyclopedia of Economics.
It’s Michael K. Salemi, “Hyperinflation.” Notice that in the third paragraph, he discusses the Hungarian inflation that Jeopardy alluded to. It was substantially more extreme than the German hyperinflation of 1921 to 1923.
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