http://www.guardian.co.uk/world/2009/jan/16/zimbabwe-hyper-inflation-mugabe-tsvangirai
why wouldn’t they just adopt the dollar or euro? That money won’t be worth the paper it is printed on… Do they (zimbabwe central bankers) not realize that this will only aggravate matters?
Ballin outta control
maybe some of the people who work Zimbabwe central banker should start studying the CFA cirricumlum…
Wonder if will be able to get my hands on one of those. Should be a collectors item one day.
fxguy1234 Wrote: ------------------------------------------------------- > why wouldn’t they just adopt the dollar or euro? > That money won’t be worth the paper it is printed > on… Do they (zimbabwe central bankers) not > realize that this will only aggravate matters? They are in a tough spot and getting out of hyperinflation is terribly difficult. If there were any significant foreign currency reserves or ability to borrow foreign currency or any prospects for economic growth they would have something to build on. You can’t just decide to peg your currency against some stable currency like, uh, well, there used to be some, but we’ll say the US . All that happens is that people will try to trade their zimbabwe currency for and there won’t be any. The world wants Mugabe gone and we will bring the economy to its knees instead of helping him do anything. In due time, he will be gone and if things work out right, the world will step in and help rebuild the economy.
Its worth noting that when Mugabe is gone, there will probably be a new currency. So that bill on ebay with 100 zeroes will be a collectors item, but not much in the way of a hard currency investment.
Jaffels Wrote: ------------------------------------------------------- > Wonder if will be able to get my hands on one of > those. Should be a collectors item one day. I was wondering the same thing
I read this article this morning, which was interesting given that I read about it last night in the economics text… anyway, I agree, I’d love to get my hands on a 100 trillion dollar bill. Better yet, I’d love to get 10 of them and then tell my grandchildren that I was a quadrillionnaire when I was 23.
Nope, not buying it until I see a $1 Zillion dollar bill.
JoeyDVivre Wrote: ------------------------------------------------------- > fxguy1234 Wrote: > -------------------------------------------------- > ----- > > why wouldn’t they just adopt the dollar or > euro? > > That money won’t be worth the paper it is > printed > > on… Do they (zimbabwe central bankers) not > > realize that this will only aggravate matters? > > They are in a tough spot and getting out of > hyperinflation is terribly difficult. If there > were any significant foreign currency reserves or > ability to borrow foreign currency or any > prospects for economic growth they would have > something to build on. You can’t just decide to > peg your currency against some stable currency > like, uh, well, there used to be some, but we’ll > say the US . All that happens is that people \> will try to trade their zimbabwe currency for > and there won’t be any. > > The world wants Mugabe gone and we will bring the > economy to its knees instead of helping him do > anything. In due time, he will be gone and if > things work out right, the world will step in and > help rebuild the economy. I hope you mean the world will wait until Mugabe dies - and the last time I checked he was very fit at 84. The only solution would be to get this dictator out - the former President of Nigeria Olusegon Obasanjo tried in 2000 to get African governments oust him but South Africa did not collaborate. Zimbambwe has some other powerful characters(including the Reserve Bank governor) even in the absence of bigot Mugabe they would cause alot of problems. There is hope in the new South Africa govt once Zuma is elected. In the mean time the people of Zimbambwe will continue to languish in poverty and die of cholera, while the world watches.
JoeyDVivre Wrote: ------------------------------------------------------- > fxguy1234 Wrote: > -------------------------------------------------- > ----- > > why wouldn’t they just adopt the dollar or > euro? > > That money won’t be worth the paper it is > printed > > on… Do they (zimbabwe central bankers) not > > realize that this will only aggravate matters? > > They are in a tough spot and getting out of > hyperinflation is terribly difficult. If there > were any significant foreign currency reserves or > ability to borrow foreign currency or any > prospects for economic growth they would have > something to build on. You can’t just decide to > peg your currency against some stable currency > like, uh, well, there used to be some, but we’ll > say the US . All that happens is that people \> will try to trade their zimbabwe currency for > and there won’t be any. > > The world wants Mugabe gone and we will bring the > economy to its knees instead of helping him do > anything. In due time, he will be gone and if > things work out right, the world will step in and > help rebuild the economy. Yea makes sense… Thanks for the insight. From wiki - “From this, it might be wondered why any rational government would engage in actions that cause or continue hyperinflation. One reason for such actions is that often the alternative to hyperinflation is either depression or military defeat. In late 2001, the Argentine peso collapsed in value. Rather than printing sufficient cash for the public to carry, which they feared would start a run on the banks, the government took the peso off its dollar peg. Many international economists predicted that they would have to get a new loan from the IMF and impose shock therapy in order to avoid hyperinflation. Currency controls were imposed, tariffs were instituted, and the economy was allowed to fall into a severe recession during which unemployment hit 25%, homelessness and crime spiraled upwards, and the poverty rate peaked at over 50%.”