Saturday, December 20, 2008
Friday, December 19, 2008
Zimbabwe's central bank introduced a $10 billion note worth less than 20 U.S. dollars, as the once-prosperous southern African nation battles against spiraling hyperinflation.
Zimbabwe President Robert Mugabe at Zanu-PF National Political Commissar Elliot Manyika's burial last week
The new note, expected to buy just 20 loaves of bread, comes just a week after Zimbabwe issued a $500 million note to ease a cash shortage. (More)
Tuesday, December 16, 2008
After rate cuts: The Fed's new ball game
With rate cuts doing little to help boost the economy, the Fed has begun to print money to finance its liquidity programs. But that could spell disaster down the road. (More)
Saturday, December 13, 2008
HARARE, Zimbabwe (CNN) -- Zimbabwe's central bank is introducing a $500 million note -- the highest current denomination -- as the once-prosperous southern African nation battles against spiraling hyperinflation.
A £50 million note introduced earlier in December has failed to clear long lines for cash.
Finance Minister Samuel Mumbengegwi made the announcement about the new note in a government gazette set for release Friday. On the back, the purple cotton bill will feature pictures of dairy cows being milked mechanically and a miner drilling underground, he said.
The Reserve Bank of Zimbabwe (RBZ) last week introduced a new set of denominations, including a $100 million note, but that has not helped to clear long lines for cash at banks. Some people sleep outside banks after failing to get cash.
The RBZ said a $200 million note would be in circulation Friday, together with the $500 million note.
The $500 million note is worth about 8 U.S. dollars and enough to buy just eight loaves of bread. Thursday, the greenback was trading around ZW$60 million and is expected to shoot up in light of the new note's introduction.
Prices change on an almost daily basis as businesses now peg their prices against the U.S. dollar.(more)
Saturday, December 6, 2008
HARARE, Zimbabwe (CNN) -- Cash-strapped Zimbabwe revealed plans Saturday to circulate $200 million notes, just days after introducing a $100 million bill, Finance Minister Samuel Mumbengegwi said.
Zimbabwe central bank governor Gideon Gono shows a new $50 million note at a news conference Thursday.
After the $100 million note began circulating on Thursday, the price of a loaf of bread soared from 2 million to 35 million Zimbabwean dollars. (More)
Thursday, December 4, 2008
Wednesday, November 26, 2008
The U.S. government is now willing to spend more than $7 trillion to help rescue the economy. That's about $23,000 for every American, and more than half of U.S. annual gross domestic product. It's a staggering and unprecedented amount of money. (more)
Tuesday, November 25, 2008
... Together, the programs from the Federal Reserve and the New York Fed are more than Congress approved in October for a bailout of the nation's banks and Wall Street firms. The Fed said the money will come from an increase in its reserves -- in essence, it is creating new money. (more)
Monday, November 24, 2008
Sunday, November 23, 2008
... The hyperinflation barrier was passed in January this year and there are no words to describe what is taking place now as no country in the world has experienced these proportions before. The OMIR has reached 443 qdrln and valuing the US Dollar has become a worthless exercise. The government, or shall we say the illegitimate government, has no answers and resists every practical opportunity to deal with the emergency simply because it incurs a high political cost. Companies are paying their workers in a variety of tradable commodities as the daily cash withdrawal limit cannot even begin to buy a loaf of bread. (more)
Tuesday, November 18, 2008
A leading Internet service provider is also demanding a monthly subscription
fee of 600 litres of fuel for corporate clients and 20 litres for
A vehicle auctioneer was the first to introduce the fuel coupons payment
system around June as cash shortages began to worsen.
An eight-year economic crisis has rendered the Zimbabwe dollar virtually
worthless, with most transactions officially or unofficially now taking
place using the more stable United States dollar or South African rand
...4. EXTENT OF HARM TO THE ECONOMYPerhaps Reserve Bank of Zimbabwe should listen to their own wisdom. Creating money our of thin air is *harmful* to the economy.
4.1 During the week ended 14 November, 2008, fraudulent bank cheques
valued at $40 hexillion (21 zeros) were intercepted.
4.2 Some of these fictitious cheques had already been deployed on the
Zimbabwe Stock Exchange, whilst others had found their way in the
illicit parallel market.
4.3 Where a total of $40 sexillion (hexillion) is created from
absolute thin air, no Central Bank in the World, even with the best
printing machines can sustain the cash requirements of the market. (more)
Saturday, November 15, 2008
8:40am: Fed chairman says policymakers are 'ready to take additional steps' as markets remain volatile and economy weakens. (more)Rates are already at 1%, this cut would take the rate under 1% for the first time in US History. More cheap loans, increased money supply more inflation.
Friday, November 14, 2008
Perhaps the worse investment bond every issued:
The interest rate is 450% a year. However, you are paid in Zimbabwe dollars. The inflation rate in Zimbabwe is currently running at 100% PER DAY. So in one year your investment would be worth fractions of a penny is terms of purchasing power.
These notes are available on ebay for $22 and $35 each respectively.
I haven't been able to track down a picture of the new 100K note yet.
Thursday, November 13, 2008
Zimbabwe Situation is predicting that Zimbabwe will break the all time inflation record in 6 weeks. This would be prices more than doubling every 15.3 hours.
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. Read More ...
Wednesday, November 12, 2008
Ron Paul warns us in the USA once again today about the risk of inflation.
"...The Republican Congress never once stood up against the Bush/Rove machine that demanded support for unconstitutional wars, attacks on civil liberties here at home, and an economic policy based on more spending, more debt, and more inflation -- while constantly preaching the flawed doctrine that deficits don't matter as long as taxes aren't raised. ..." Read the whole commentary here in CNN...
Tuesday, November 11, 2008
Cato is reporting that the monthly inflation rate is 13.2 billion percent. Stated otherwise prices are doubling every 24.9 hours. The record inflation rate is price doubling ever 15 hours for a whole month. Hungary holds this record.
It looks like Zimbabwe is on pace to break the record. If you look at just the past week's data, prices are doubling every 22 hours 14 minutes. Interesting price doubling discussions here on Wikipedia.