In early April, Venezuela saw dairy prices rise by an incredible 30% -- but that's just the beginning. According to Bloomberg, the South American country "has seen shortages of basic goods including sugar worsen since President Hugo Chavez devalued the Bolivar by as much as 50 percent this year."
Venezuelan annual inflation now stands at 30.4%, according to the Central Bank and National Statistics Institute -- the highest of any Latin American country. It is clear to most that Venezuela has moved beyond high inflation and entered the ominous realm of hyperinflation.
These events have unfolded just as Elliott Wave International's Jason Farkas predicted in January. In his Jan 22nd Weekly Insight, he stated that "Venezuela is firmly on the road to hyperinflation" and listed the reasons why:
"Rampant inflation has already destroyed any idea of savings in Venezuela, but it is only likely to turn into hyperinflation now because of three conditions: (1) Inflation is already systemic, (2) the money supply has increased substantially, and most importantly (3) it is impossible to access cheap capital in Venezuela."
Increased money supply is not unique to Venezuela. The U.S. and European Union have also taken to increasing the money supply through credit creation in recent years. Does this mean that the next step for the U.S. is hyperinflation?
Find out now what subscribers already know. Get Jason's in-depth January 22 Weekly Insight on this subject -- plus a dozen more of his eye-opening articles -- when you subscribe to Currency or Interest Rate End-Of-Day Specialty Services today. Learn more >>