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80% of all dollars were created in the last 5 years

The Big Money Boom: What It Means for You

Have you heard the jaw-dropping fact that 80% of all US dollars were created in the last five years? Yes, you read that right. That’s a lot of new money floating around! But what does this actually mean for you and me? Let’s break it down into simpler terms and see how it affects our daily lives.

Why So Much New Money?

First, let’s understand why there’s so much new money. Think of the economy like a car engine. During normal times, the engine runs smoothly with the right amount of fuel. But what if the engine starts to stall? That’s where central banks come in, acting like mechanics to get things running again. They ‘create’ money, much like adding fuel, to help the economy – our engine – run smoothly.

In the last five years, we’ve had some big bumps in the road – the COVID-19 pandemic being the biggest. To prevent the economy from stalling, central banks around the world, including the Federal Reserve in the US, decided to create a lot of new money to keep things moving.

What Does This Mean for Prices?

One word you might have heard a lot recently is ‘inflation’. Inflation means the prices of things we buy, from bread to houses, go up. When there’s a lot of new money in the economy, prices tend to rise because there’s more money chasing the same amount of goods and services.

This might be good news if you own things like stocks or a house, because their value might go up. But it’s not such good news if you’re buying groceries or saving for a home, as your money doesn’t go as far as it used to.

What About Your Savings?

Here’s another thing to consider: when there’s a lot of new money and higher inflation, the value of the money in your savings account can decrease over time. This is because the purchasing power – what you can buy with your money – decreases as prices increase.

How Does It Affect Loans and Mortgages?

If you have a loan or a mortgage, inflation can be a double-edged sword. On one side, if your income goes up with inflation, then paying back a fixed-rate loan might become easier over time. On the other side, if you’re looking to take out a new loan or mortgage, the interest rates might be higher because lenders also adjust for inflation.


The recent surge in money creation in the United States, where 80% of all dollars were created in the last five years, and the hyperinflation experienced in Germany during 1922-1923, provide fascinating points of comparison and contrast. Both periods involve significant increases in the money supply, but the outcomes and circumstances differ greatly. Here’s how:

Context and Causes:

Recent US Monetary Expansion:

  • Triggered by Economic Crises: The recent increase in the US money supply was a response to economic downturns, primarily the COVID-19 pandemic. The Federal Reserve and the government aimed to stimulate the economy, prevent job losses, and support businesses.
  • Controlled Expansion: Although significant, the monetary expansion was part of controlled policies like quantitative easing and fiscal stimulus, intended to stabilize and boost the economy.

German Hyperinflation (1922-1923):

  • Post-War Reparations and Economic Mismanagement: Germany’s hyperinflation was largely a result of the burdensome reparations from World War I, compounded by poor fiscal policies and political instability.
  • Uncontrolled Money Printing: The German government started printing money recklessly to pay off war debts and reparations, leading to an excessive increase in the money supply without economic growth to support it.


Recent US Scenario:

  • Inflation Concerns: There are rising concerns about inflation, which has been higher than usual, affecting prices and living costs. However, it is not near the levels of hyperinflation.
  • Economic Recovery and Growth: The monetary expansion has helped in economic recovery and maintaining employment, despite causing inflationary pressures.

German Hyperinflation:

  • Economic Collapse: Hyperinflation in Germany led to the complete collapse of the currency’s value, wiping out savings and leading to catastrophic economic conditions.
  • Societal Impact: The hyperinflation had severe societal impacts, leading to widespread poverty, social unrest, and contributing to the political instability that would later contribute to the rise of the Nazi party.

Government and Central Bank Response:

Recent US Measures:

  • Controlled Approach: The US has employed a more measured approach, with the Federal Reserve signaling it can adjust policies as needed to control inflation.
  • Focus on Stability: The aim has been to maintain financial stability and encourage gradual economic recovery.

German Hyperinflation:

  • Lack of Effective Measures: During the hyperinflation period, the German government and Reichsbank were either unable or unwilling to implement effective measures to control the money supply.
  • Resolution through Currency Reform: The crisis ended with the introduction of a new currency (the Rentenmark), which helped to stabilize the economy but came after significant damage had already been done.


While both the recent US monetary expansion and the German hyperinflation involve significant increases in the money supply, they differ vastly in scale, causes, management, and outcomes. The US has experienced inflationary pressures but remains far from the catastrophic conditions of Germany’s hyperinflation. The historical example of Germany serves as a cautionary tale of how unchecked money printing and economic mismanagement can lead to severe economic and societal consequences. In contrast, the US’s approach, despite its challenges, has been more about trying to balance economic growth and inflation control.