Back in 1975 Adam Fergusson, a Fellow of the Royal Society of Literature, published a very important book with a very apt modern title, When Money Dies. It was about the nightmare of Weimar hyperinflation, something our so-called leaders might well think about, which of course they will not. We are so dumbed-down by reality and talent shows on the idiot box, why bother to bring up unpleasant subjects? Only recently I read somewhere that the obnoxious John Prescott defended the war criminal Tony Blair and his party’s record, which in a way is not unlike arms manufacturers being praised by Greens for population control. People are simply too dumb, too cowed, or too interested in celebrity goings-on to care about what a slob like Prescott bloviates about. What they should have done is throw him overboard — he was on a freebie cruise — but instead they listened in silence to his bad-taste jokes and defence of Blair.
Inflation is what kills wealth, unless the goodies are in property, ships, or other such solid matter, but let’s not get too academic about it. The only ones inflation helps are debtors, which are most Western governments nowadays. No wonder they don’t mind piling on the debt. But for us normal folk, inflation can be a very big pain in the you-know-where. Did you know that one pound sterling back in 1923 is the equivalent of £623 today? One dollar back then could buy what $220 dollars buys today. Just think about it. You could give a nice-looking German girl one dollar as a tip, and hope that she might let you walk her home after she’d finished working at the restaurant. Girls back then were moral and a walk was the equivalent of a f*** today. Nowadays you’d need to come up with $220, and she’s more likely to thank you for the tip and inform you not to get your hopes up because she lives upstairs with another woman (mein partner) and that three’s a crowd.
The great economist Taki says that tipping one dollar makes one look a gent, but $220 makes one look vulgar and a fool. When I was a very small boy, I remember running out of the house and picking up millions off the street. This was 1943 and the drachma had just been devalued again. Bills of one million had been scattered all over — worthless. I didn’t understand inflation at such a young age so I scooped them all up and brought them home, where Fräulein gave me a wintry smile and tried to explain. She, in fact, had been ruined by the inflation of 1923, and had had to go to work as a nanny to rich foreign children, so she knew what she was talking about.
In 1923 a billion meant a million times a million, as it does today, but unlike today, there were no real billionaires around, except for the false ones in the Weimar Republic. Just imagine. At the end of the first world war one could in theory ‘have bought 500,000,000,000 eggs for the same price as that for which, five years later, only a single egg was procurable’. I am quoting Adam Fergusson. Papa Hemingway wrote a wonderful news story about German inflation called ‘Medals for Sale’. He describes how a distinguished gentleman offers a few medals to a man selling apples from a cart. The man pulls open a drawer in the cart and shows it to him. It’s full of medals. The gent says nothing and walks away with dignity. When I first read it, I died a little. So you fight for your country and what you get in return cannot even buy you an apple. No wonder Hitler came to power.
My father-in-law told me that paying bills by post became a no-no because the stamp cost more than the amount being paid, no matter how large. In the Austrian embassy in Rome, where his father was ambassador, the staff went unpaid but continued to work out of respect for his excellency the prince. He was so disgusted he paid them out of his own pocket, resigned and went home.
I write all this because of Uncle Sam and the Bank of England’s appetite for ‘quantitative easing’, the bureaucrooks’ lingo for printing moolah. Why can’t they simply call it printing money? QE is an American invention, like reality shows and celebrity programmes. The Brits simply follow, the way they did for Iraq and Afghanistan. The bankers tell us that printing money will stimulate the economy. The great economist Taki is not convinced. Stopping the presses is like stopping a VLCC — a very large tanker — it can take up to 20 miles. Worse, it takes a very long time for inflation to show up even after you’ve stopped printing. At present inflation is running at three times the rate of public and private sector pay increases, which means everyone is getting poorer except for the bankers and the deal-makers. And those who owe big money to the big banks for the latter’s financing of their shady mega deals.
Still, life goes on and a very good life it is except for the crappy snow in Gstaad, and the arrival of Abramovich types, not too many, thank God. I had a slight run-in with one of them who refused to take off his very dirty boots inside a very clean shop on the main street. The owner didn’t dare ask him to remove them. So I put in my two cents by reminding him that it wasn’t too long ago that he was without shoes, so why not revert to his younger self and remove them. He was not best pleased.