The ultimate driver of this inflationary wave was monetary expansion originating at the heart of the global monetary system in Europe and the US. As war expenditure surged, in none of the combatant countries did taxes keep up. The state skimmed off purchasing power by issuing government bonds repayable long after the end of the war. But much surplus purchasing power remained in circulation. Furthermore, a large part of the bonds were purchased not by savers but by banks. Rather than immobilizing household funds, the bonds provided the banks with a safe investment that could be resold for cash
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