Tuesday, February 03, 2009
In an attempt to try to tame hyperinflation and avert total economic collapse Zimbabwe's central bank revalued its dollar again on Monday, lopping another 12 zeros off its battered currency.Steve Hanke estimated last last year that the annual inflation rate had reached 6.5x10108 percent through November last year. The government has given up trying to force shopkeepers to keep the Zim$ as the sole medium of exchange. According to CNN, more than Zim$300 trillion is needed to buy one U.S. dollar.
Reserve Bank of Zimbabwe Governor Gideon Gono announced the new currency moves on Monday, adding that some foreign exchange controls will be relaxed and gold producers now can sell bullion directly and not to the central bank as in the past.
This is the third renomination of the Zim$; ten zeroes were stripped off the currency last August. Will their inflation reach the Hunagarian pengo for the record?
Tuesday, November 18, 2008
In Zimbabwe, where it will be a race to see if collapse or the record for hyperinflation comes first.
The latest figures put the country's annual rate at 516 quintillion per cent � 516 followed by 18 zeros � overtaking Yugoslavia in 1994 and putting it behind only Hungary in 1946.
With goods unavailable and official statistics widely distrusted, the Cato Institute in Washington calculated the figures based on exchange rate movements and market data.
In post Second World War Hungary monthly inflation reached 12,950,000,000,000,000 per cent, with prices doubling every 15.6 hours � Zimbabwean prices are currently doubling every 1.3 days.
Stores are only accepting dollars and SA rands now, so if you don't have foreign currency you are probably doing business only by barter. (One ISP is selling connectivity for gas.) And collapse has lead to an outbreak of cholera, and gold production has fallen flat.
The end game may be afoot, if this rumor in a South African paper about Gideon Gono, the Reserve Bank of Zimbabwe governor, is true:
When learned that Mugabe had reluctantly handed over the finance ministry to Morgan Tsvangirai, of the Movement for Democratic Change (MDC), he marched straight to the US Embassy, where he told officials he would give them details of the looting of the country by Mugabe via share transfers and foreign exchange deals. In exchange, Gono requested 5-million and residence permits in a western country for himself, his wife and his mistress.Will Mugabe's bag man turn his boss in to the US?