In the 1920's and early 30's, hyperinflation from the Weimar Republic led to the rise of Hitler, and a six year global war. Failure in economic and monetary systems throughout history have been a leading cause of violence, poltical overthrow, and war.
That fear may be escalating in the nation of Iran as news on January 10th coming out of the Islamic state is now showing a daily rise in price inflation, and in many cases, doubling of prices are occurring as consumers seek to buy all types of goods in the local markets.
An EA source reports that a relative in Tehran ordered a washing machine for 400,000 Toman (about $240) this week. When he went to the shop the next day, he was told that --- amidst the currency crisis and rising import costs --- the price was now 800,000 Toman (about $480). Another EA source says that the price of an item of software for a laptop computer has tripled from 50,000 Toman to 150,000 Toman within days. – EA Worldview
With the ongoing threat by the US, Europe, and the UN of economic sanctions over Iran's nuclear program, the potential for an economic and financial meltdown in the Middle Eastern state is increasing. As such, the recent exercises by Iran in the Straits of Hormuz, coupled with the growing preparations in both Israel and the United States indicate high tensions for war, or a surgical strike that could cripple their nuclear capabilities, as well as their oil and economic production.
Interestingly, Iran seems to be preparing for an inevitable break with the petro-dollar, and US hegemony over the reserve currency. On Saturday, Russia completed an agreement with Iran to allow for trade exchanges to be done in both nations currencies, bypassing the US dollar altogether. This agreement, along with the fact that Russia and China have arms agreements with Iran, could very quickly escalate any attack on them to include multiple countries entering the arena.
Economic insolvency, and monetary destruction are key components throughout history for wars to be started and enacted. With news of growing hyperinflation taking place in the nation of Iran, the probability of war, or other military actions grows exponentially. And the longer that hyperinflation rages within their economy, the greater the possibility for internal unrest from the citizens of the Islamic state.
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