Fantastic article, as always. Let me throw in my perspective. Hugo Stinnes—an often-overlooked titan of industry from the Weimar Republic era—stands out as perhaps the greatest investor you've never heard of. He turned the rampant inflation of his time into his own personal gold rush, amassing enormous wealth in a way no one has replicated since. Why haven’t others managed to pull off such a feat? It's not like inflation has vanished.
There are two key reasons:
During Stinnes' era, the German mark was never a reserve currency. Its usage and demand were predominantly domestic. This lack of global demand meant that the gold reserves were quickly depleted, igniting the hyperinflation that Stinnes exploited.
The financial infrastructure of the time was rudimentary at best. With today’s sophisticated financial systems in place, such an environment would be nearly impossible to replicate in the U.S. Not that we’re immune to inflation—far from it. However, opportunities for leveraging inflation profitably, such as during periods of low mortgage rates, are rare. Generally speaking, achieving success today often involves leveraging low-cost capital, much like Warren Buffett has demonstrated.
In short, while inflation presents occasional opportunities, the conditions that allowed Stinnes to flourish were unique to his time.
Great write up. Wheelbarrows of fiat cash is crazy to see.
My grandmother - the legend she was - bought me some life influencing materials when I was younger.
+ When money dies - Adam Ferguson (Weimar republic hyper inflation)
+ The Ascent of money - Niall Ferguson (The history of money)
I read both of these books and as it turns out - grew into an amateur finance person with a keen interest in economics and finance.
Its soon time for me to re-read When money dies.
I'm just reading The Great Depression - Benjamin Roth
I read When Money Dies a few years ago and just can't get it out of my head. Those other books sound interesting. Thanks!
Have you read “When Money Destroys Nations,” yet?
Not yet. Sounds good.
Fantastic article, as always. Let me throw in my perspective. Hugo Stinnes—an often-overlooked titan of industry from the Weimar Republic era—stands out as perhaps the greatest investor you've never heard of. He turned the rampant inflation of his time into his own personal gold rush, amassing enormous wealth in a way no one has replicated since. Why haven’t others managed to pull off such a feat? It's not like inflation has vanished.
There are two key reasons:
During Stinnes' era, the German mark was never a reserve currency. Its usage and demand were predominantly domestic. This lack of global demand meant that the gold reserves were quickly depleted, igniting the hyperinflation that Stinnes exploited.
The financial infrastructure of the time was rudimentary at best. With today’s sophisticated financial systems in place, such an environment would be nearly impossible to replicate in the U.S. Not that we’re immune to inflation—far from it. However, opportunities for leveraging inflation profitably, such as during periods of low mortgage rates, are rare. Generally speaking, achieving success today often involves leveraging low-cost capital, much like Warren Buffett has demonstrated.
In short, while inflation presents occasional opportunities, the conditions that allowed Stinnes to flourish were unique to his time.