Excerpt:
"We learned that in high periods of inflation, inflation becomes the dominant factor. It becomes less about what you own (value vs growth or tech vs banks) and more that you own something.

We learned that in times of high inflation the risk is not so much to the left (20% stock market correction), but to the right.

It’s the risk that prices rise unimaginably and you are left behind.

We learned from from Zimbabwe that paradoxically, Bad is Good when it comes to the stock market.

There can be power outages, crop failures, people walking around with no money and yet the market goes to the moon.

Stocks, property, precious metals; everything goes up as people scramble to escape cash.

But that’s Zimbabwe. It’s Africa.

We study it because it’s a useful exaggeration. It’s a way for us to understand how markets dynamics change as inflation rises.

But that type of a market environment is rare in this day and age. We have to study obscure countries in Africa, or Latin America to understand what happens.

Thankfully, that would never happen here. Right?

We don’t have to worry about high inflation. The Fed has raised rates, inflation is moderating and things are under control.

Still, it might be useful to be able recognize the signs if things were shifting towards a hyper inflationary environment. And what would those signs be?

Of course there would be monthly economic statistics to show us CPI was running structurally higher, but maybe if inflation numbers were bouncing around a lot it might be hard to tell the trend, especially in the beginning.

But maybe there would be other signs along the way, which would warn us inflation was going to get a lot worse. Maybe there would be cultural signs that things were going to spiral out of control.

The best account I’ve come across of the cultural signs leading to inflation is ‘Fiat Money Inflation in France’ by Andrew Dickson White, a history professor and founder of Cornell. It was written back in 1896 as a historical review of the Assignats and France’s slide into inflation in 1789.

As with Zimbabwe, we learn that the worse things seem to get, the more the market rises.

It’s another example of the Bad is Good theme.

So what were some of the signs along the way from France’s slide?

It always starts the same way. Business is slow and the government is looking for a shortcut."