PROTECTION AND WEALTH BUILDING STRATEGIES 237ary. The difference between this coming inflation and those
in the past is that few investors will know where the inflation
is coming from. Politically, it will not be easy to hold the U.S.
Treasury or the Federal Reserve accountable, because they will
just point a finger at the IMF.
This book will make you better acquainted than most
with this hidden source of inflation. Ahamed’s book is a good
chance to meet the financial world’s fire department before the
next great fire.
■ The Downfall of Money
Despite the widespread identification of “Weimar” with hy-
perinflation, few investors know the detailed history and po-
litical dynamics that led to Germany’s catastrophic outcome.
The facts that Germany had recently been defeated in the
first World War and bore a heavy debt burden in the form of
reparations to France, the U.K. and other victorious powers
are necessary background.
You may also know that communists and proto-Nazis
fought street battles, led regional rebellions and engaged in
assassinations of high-profile political figures. But even this
backdrop does not tell the whole story.
To understand exactly what happened, and why a repetition
in the U.S. is a real possibility today, I highly recommend The
Downfall of Money: Germany’s Hyperinflation and the Destruction
of the Middle Class, by Frederick Taylor. This is the best and most
thorough account of the Weimar hyperinflation yet and is likely
to remain the definitive history.
Most accounts of the Weimar hyperinflation focus on Rudolf
Havenstein, the director of the Reichsbank, the central bank
of Germany. Havenstein had control of the printing presses
and was directly responsible for the physical production of the
banknotes, eventually denominated in the trillions of marks.