The Legacy of 'Black Death' Inflation
In the 1300s, a squirrel caused massive inflation in Europe...
The Tarbagan marmot – a 2-foot-long squirrel – lives in deep burrows near the base of the Himalayan mountains. It's a beautiful place... But few folks know it's a breeding ground for the bacteria that causes one of the world's most gruesome diseases.
The bubonic plague.
Back in the 1300s, when the marmot population was much greater, the marmot-to-flea-to-rat-to-flea (again)-to-human chain became extensive at just about the time that global trade was expanding. That created a world-altering situation that went unnoticed as it happened right in front of everyone near a boat...
When ships set sail from Asia for Europe and beyond, infected rats scampered up mooring lines... And when these ships pulled into their next port, they parked just long enough for a few rats to escape to shore.
Then the process repeated at the next city up the coast. The plague spread through trading routes.
The bubonic plague had many outbreaks over the centuries, starting as early as the plague of Justinian around 540 A.D. But the outbreak in Europe and Asia starting in 1347 earned the name "Black Death" for good reason.
Since doctors at the time did not understand how the disease spread, it was largely unstoppable. Estimates suggest that as many as one-third of all Europeans died from the Black Death between 1347 and 1350. Tens of millions died overall from the plague in the 14th century, and world-population levels didn't rebound to preplague numbers for another 200 years.
You can imagine the social upheaval that such a wipeout caused. Many thought the world was ending, especially given the horrific nature of the deadly disease (of which we'll spare you the details).
The world, of course, didn't end... But the Black Death certainly left its mark on human history in many ways.
In the immediate aftermath of the Black Death outbreak, prices of all sorts of items fell. With so many people dying, there was less demand for staples of the European economy, like wheat and barley.
But soon after the height of the Black Death, prices doubled within a three-year period.
Pardon our love of obscure charts, but here's the price of wheat in England from 1346 through 1351, converted to cents per bushel...
After the initial decline in demand around 1347, the bigger problem for the European economy became the lack of available labor to till fields and tend to the mules or whatever other farm-related jobs folks had back then.
This led to a decline in available supplies and a rise in wages, both contributing to rapid inflation as the value of items went up and the value of money went down.
This "Black Death inflation" stands in contrast to many of the other historic episodes of inflation that have generally been studied...
It's often claimed that inflation only comes from the debasement of a currency through money-printing or other vast increases in the money supply.
But the truth is that analyzing inflation is difficult. No one – not politicians, economists, central bankers, or hedge-fund wizards – fully understands it. It comes from complex interactions between monetary and fiscal policy, the financial system, and the expectations of everyday people.
Today, the world during the bubonic plague doesn't seem so strange. We've lived through the global COVID-19 pandemic and we saw the cost of everything – from housing to food – increase, alongside shortages of essential products.
Back in 2022 and 2023, inflation was the worst we had seen it in nearly four decades. We saw the biggest rise in inflation since 1982. To fight back, the Federal Reserve raised interest rates 11 times during those years.
Today, the threat of inflation is looming in the U.S. once again...
A recent poll found that 94% of Americans listed inflation as their top economic worry. And last week, the Fed decided against lowering rates because of inflation fears.
Average folks know that – despite the end of the pandemic – everything feels must more expensive... from housing to food. That's because we're living through a great national devaluation.
Your money is worth less than ever before. Your labor is worth less.
You know what this devaluation feels like – in big and small ways across American life.
It's the little surcharges on restaurant bills... the packages on store shelves that get gradually smaller for the same price... and higher premiums for the same health insurance.
This devaluation has been happening for decades.
And while mainstream headlines focus on inflation and interest rates, we're experiencing a financial reset that erodes purchasing power and ruins traditional strategies like holding bonds and cash.
To help investors prepare, I'm introducing a new investment blueprint designed specifically for an era of currency devaluation.
Rather than rely on outdated approaches, this strategy centers on hard assets, select inflation-resistant companies, and a fully diversified portfolio to protect and grow your wealth.
Don't sit still while your dollars lose value... Take action now. You can get all the details here.
What We're Reading...
- Something different: Canada wildfires cause poor air quality in the Midwest and Northeast U.S.
Here's to our health, wealth, and a great retirement,
Dr. David Eifrig and the Health & Wealth Bulletin Research Team
August 4, 2025