Watching from afar as inflation in Argentina grows worse – officially 11%, realistically around 25% – it's tempting to think of the scourge of fiat money as a modern phenomenon. If only FDR hadn't confiscated US citizens' gold to usher in the beginning of the current era of paper money, we could be living in a precious metals paradise, as our ancestors before us did.

That narrative, of course, is utterly false. Humans have been screwing up money for centuries, beginning with China's printing of jiaozi in the 10th century. History is littered with episodes of hyperinflation, but my favorite is that of revolutionary France as told by Andrew Dickson White in Fiat Money Inflation in France. It contains the most vivid description I've seen of how inflation transforms into hyperinflation, and how far governments will go to maintain their power in the face of a dying currency.

France's hyperinflation began as all hyperinflations do: the state printed too many assignats (pictured below), and they rapidly lost their purchasing power. French citizens sought alternative stores of value and mediums of exchange, as any intelligent person would.

The French government, correctly perceiving this as a threat to its financial hegemony, reacted violently. I'll let three short passages from the book explain. Note in particular the rapid progression (all emphasis mine):

August 1793:

“Couthon had proposed and carried a law punishing any person who should sell assignats at less than their nominal value with imprisonment for twenty years in chains, and later carried a law making investments in foreign countries by Frenchmen punishable with death.”

September 1793:

“The Convention decreed that any person selling gold or silver coin, or making any difference in any transaction between paper and specie, should be imprisoned in irons for six years: – that anyone who refused to accept a payment in assignats, or accepted assignats at a discount, should pay a fine of three thousand francs … Later, the penalty for such offences was made death, with the confiscation of the criminal's property, and a reward was offered to any person informing the authorities regarding any such criminal transaction.

May 1794:

“The Convention decreed that the death penalty should be inflicted on any person convicted of having asked, before a bargain was concluded, in what money payment was to be made.”

Yikes. Fiat currency isn't just a contemporary problem, that's for sure. Are Argentines headed for the guillotines, too?

Probably not. The Argentinian government has made a virtual decennial ritual out of inflating its currency out of existence. As a result, Argentines have earned their black belts in navigating through hyperinflations. That, combined with the Argentine government's lack of resources to enforce its edicts, ensures that most Argentines won't suffer the gruesome fate that many poor 18th-century Frenchmen did.

Importantly, though hyperinflations – or even just double-digit inflations – decimate much of the wealth of a populace, they also create massive distortions. Or, as we like to call them at Casey Research, opportunities.

Indeed, in the newest issue of The Casey Report, which will hit subscribers' inboxes tomorrow afternoon, Casey Research Chief Economist Bud Conrad digs into the worldwide agricultural markets to answer the question: Is agriculture a good investment at today's prices?

If you're wondering how agriculture and hyperinflation are related, here's how: Bud's analysis concludes with a compelling recommendation to buy a specific agricultural company that owns hundreds of thousands of hectares of farmland in Argentina… an opportunity made possible by Argentinian President Cristina Fernández de Kirchner.

How? Farmland prices have risen rapidly around the globe – so rapidly that buying farmland today looks like a good way to lose money, at least in the short term. But Kirchner has bungled the Argentinian economy so badly and has investors so spooked that Argentina is one of the only places on earth where you can buy productive agricultural land on the cheap.

Thanks, Cristina! If you want to join us in snapping up one of the only sources of cheap farmland left, you can try The Casey Report absolutely risk-free.

For more on the Argentinian situation, I'll turn it over to Jeff Thomas, worldly correspondent of He's penned, exclusively for us, a story about the long lines developing at South American ATMs. Read on to find out why.

Dan Steinhart
Managing Editor of The Casey Report