If we have hyperinflation, my money in the bank will be worthless. So shouldn't I spend it on material goods?

Answer 1

Ya, but the US can not expirence hyper infation because of the wide spread use of the dollar as an trade currency.

A trading currency is like when Ethiopia uses dollars to buy goods from Saudi.

The dollar as a trade currency means the probability of everyone "attacking" the bank and demanding their money to be exchanged for forgien currency and causing a currency crisis is very low

Answer 2

In answer to answer #1, the dollar WAS the international trade standard, but is being replaced by the Euro because of our financial insolvency.

Buying material goods is how you could cover yourself in the event of a hyper inflation. You would need to buy things that retain value--not cars or clothes or perishables like food. Gold, other precious metals, or diamonds, store them in total safety, a safe deposit box, or buy futures contracts on them if you expect their prices to rise. However a lot of people will be buying those contracts. Real estate might be good, except the market can fluctuate and actually go down if people cannot afford to buy.

Answer 3

And may be the contrary process....so money's value can grow in comparison with material goods....
And don't forget about such "keepers" as precious metals, gems and foreign currency)

Answer 4

You have to keep a certain amount of cash for emergencies. Gold is traditional hedge against inflation.