Is it a good idea to exchange 2000 USD To GBP for financial security after presumed Hyperinflation?

Submitted by DartrixE54 t3_127ok05 in personalfinance

Perhaps I have been given misinformation, but I have seen several people saying that the USD may be on the verge of hyperinflation. I live in Ecuador, a country that suffered hyperinflation with the old currency before we switched to the dollar. It was a terrible experience, so I want to be prepared in case hyperinflation happens to the dollar. I have some questions or concerns that I believe you can help me with:

If hyperinflation occurs, are pounds a safe option?
Is hyperinflation actually happening?
Are pounds the best option, besides crypto?

Here is some information about my financial situation:

  • Pre-investing savings: $3,000 USD
  • Post-investing savings: $1,000 USD (Only if I invest)
  • Gross monthly income: $1,100 USD
  • Debt: $750 USD
  • Monthly living expenses: $710 USD

If you have any further questions that could help you assist me, they are always welcome. Thank you so much for sharing your expertise with me.

0

Comments

You must log in or register to comment.

t-poke t1_jef0fge wrote

You have been given misinformation. There's no risk of hyperinflation with the USD.

22

barrycarter t1_jef0wkp wrote

> Perhaps I have been given misinformation, but I have seen several people saying that the USD may be on the verge of hyperinflation

It seems highly unlikely that USD will experience hyperinflation. And, if it does, to be honest, it'll be because the world economy is collapsing as a whole and no currency will be safe.

35

harrisc42 t1_jef0wov wrote

The US dollar drives all world currency. If it were to experience hyperinflation the likes which we've seen in lesser developed nations, no currency in the world would be safe.

14

DartrixE54 OP t1_jef1cnb wrote

The main argument for Hyperinflation I've seen its about Saudi Arabia no longer taking dollar for the oil transactions, Dollar beeing backed by oil, this seems like danger, However, that may be misinformation as well

−9

VirTS t1_jef2is2 wrote

I'd actually argue there is more of a risk of deflation than inflation at this point, and the USD has deflated already relative to other world currencies quite a bit since COVID.

1

academictoss t1_jef2s0b wrote

>presumed hyperinflation

Lmfao. No. Even with peak post COVID inflation, it’s not even high in historical terms. The 70s has sustained double digits inflations. There’s never remotely been any risk of hyperinflation of USD ever. At all.

5

TheBlindDuck t1_jef32ye wrote

Absolutely do not do crypto.

USD has a significantly lower inflation rate than the British pound right now.

USD won’t hyper-inflate unless a significant world event caused the US to no longer be the world superpower. This is highly unlikely for at least the next 10 years.

Final advice: Stay in USD.

7

alexm2816 t1_jef44y7 wrote

Replying to DartrixE54 (#2,533,918)

Ask yourself, if you sold 11% of the global supply of something globally but 75% of your sales of that something was sold in North America and 39% of your sales of that something was sold to the US what currency would you probably want to consider using?

The beautiful thing about the internet is that anyone can share their thoughts and information. The bad thing is that most of that information is trash and makes no sense once you peel back the first thinnest layer of the BS onion.

6

CarbonMop t1_jef4xv8 wrote

Nothing is impossible, but USD hyperinflation is extremely unlikely.

More importantly, almost any scenario that might produce hyperinflation in USD would almost certainly make GBP just as dangerous, if not more.

Most fiat currencies are scary in this scenario. Might be a more appropriate question for a doomer subreddit, not a finance one.

4

Liquidretro t1_jef62j4 wrote

Replying to DartrixE54 (#2,533,918)

The USD isn't backed by oil, it's backed by full faith and credit of the government. A very small percentage of oil used in the USA comes from Saudi Arabia these days. https://www.eia.gov/energyexplained/oil-and-petroleum-products/imports-and-exports.php

Saudi Arabia depends heavily on the USA for defense and purchases billions of dollars of weapons a year.

Do some research on the stuff these people are telling you before you try to make financial decisions on it. I wouldn't take world advice or financial advice from these people, they seem to be in deep with conspiracy theories they see on social media.

6

HorizontalBob t1_jef7zik wrote

I'm not against diversification so tell me what the negative of holding GBP vs dollar and why GBP vs another currency.

While I doubt the hyperinflation of the dollar happening, it would have global consequences. The largest GDP in the world with #2 and #3 as the largest foreign US debt holders. The US has the largest military budget. There's special relations with England is not part of the EU. While I could see the steady decline of the US in the world, a fast decline affects everyone.

1

EpiZirco t1_jefdvfx wrote

First of all, there is no risk of US hyperinflation. Second, the pound has not been doing too well lately (though it has recovered somewhat from its low in September), and the UK's long term prospects have been hurt by Brexit. The dollar is basically as safe a currency as you can find.

Since Ecuador uses dollars, it makes most sense for you to stay in dollars. Exchange fees eat big chunks of money when you move from one currency to another.

Crypto is just gambling. Go to a casino instead.

3

DartrixE54 OP t1_jefi6ay wrote

Thank you all, I've just been fed misinformation

2

turnipham t1_jefidd3 wrote

Inflation in US is somewhere between 5-6%. That's hardly hyperinflation.

1