HARARE, Zimbabwe – A woman pays her bus fare with 3 trillion in old Zimbabwe dollars — the equivalent of 50 U.S. cents. The collector accepts the brick of neatly folded bundles of a trillion each without bothering to count the notes.
"No one seems to worry, and it works," said the woman, Lucy Denya, a Harare secretary who says she's seen police officers using old notes to board buses.
The Zimbabwe dollar is officially dead. It was killed off in hopes of curbing record world inflation of billions of percentage points, and Zimbabwe has replaced it with the U.S. dollar and the South African rand.
Yet the role of the old Zimdollar, as it is known, remains in flux. It is still used, and has become another point of contention for the divided leadership of the country, now one of the poorest in the world.
President Robert Mugabe has called for the return of the Zimdollar as legal tender, complaining that most Zimbabweans lack the hard currency needed to buy basic goods. The central bank under governor Gideon Gono, a Mugabe loyalist, has acknowledged printing extra local money to fund government spending that fueled inflation.
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Our future.
ReplyDeleteWe still can't make up our mind - inflation or deflation? I think the billion dollar investors that read this blog are getting confused by the mixed signals.
ReplyDeleteBoth. First Depression as companies die off like flies and try to sell stale inventories to survive. Landlords slash leases to try and rent out their long empty spaces. Then Inflation when the banks flood the economy with their trillions in ill-gotten reserves.
ReplyDeleteDepression: Now through early Spring 2010. After that inflation. I say that because end of year holiday numbers are going to be horrific.
I do enjoy false optimism as much as the next guy though.
**DEPRESSION ALERT**
ReplyDeleteReceived my Depression 2009 t-shirt today. It is HIGH QUALITY! You know how most online t-shirts are paper thin and look like they will fall apart on the second wash? Not this one - it is thick.
Looks sharp. Get one. Show people how you really feel! :)
The person at 12:53 post stated exactly the steps before total collapse. First people desperately try to sell their goods at any cost, thus creating deflation as stuff sells for 10 cents on the dollar. When the collapse occurs, inflation takes hold on the dollar, as people exchange goods instead of using the useless currency, as it disappears into never land.
ReplyDeleteThat sums it up pretty good. I know my competitors are giving away the farm to compete with us right now. Literally giving goods and services away.
ReplyDeleteDepression is not the same as deflation. We will be in a depression for many years and in fact probably will never be the same again. With energy ever on the decline it will be impossible to see deflation for longer than a short period. Energy is tied to the current equation after all.
ReplyDeleteI have been getting a lot of stares with my Depression 2009 t-shirt today! :) I think the only think worse would be one of those Obama Clown t-shirts.
ReplyDelete