HARARE, Zimbabwe (CNN) -- Zimbabwe's central bank says it will soon introduce a 100 trillion dollar note as the once prosperous country battles to keep pace with hyperinflation that has caused many to abandon the country's currency.
The Reserve Bank of Zimbabwe said the new notes that includes 50 trillion, 20 trillion and 10 trillion would be released for the "convenience of the public," according to statement released Thursday.
"In a move meant to ensure that the public has access to their money from banks, the Reserve Bank of Zimbabwe has introduced a new family of bank notes which will gradually come into circulation, starting with the 10 trillion Zimbabwe dollar," the bank said in its announcement.
The new 100 trillion dollar bill would be worth about $300 in U.S. currency. A loaf of bread in Zimbabwe now costs about 300 billion Zimbabwean dollars -- and like most commodities, the price increases every day.
Earlier this month, Zimbabwe introduced a 50 billion dollar bill as the country battles to fight cash shortages stemming from the world's highest inflation rate. The official rate was 231 million percent as of July.
The currency is in free fall, forcing traders to peg their prices to international currency to hedge against losses. The Zimbabwean dollar is facing extinction, with most traders now accepting other countries' notes, claiming that they import their products.
Even vegetable vendors prefer the U.S. dollar, South African rand or Botswanan pula, and most workers now demand their salaries in foreign currency. Doctors and nurses have been on strike since last September, demanding salaries in U.S. dollars. The strike coincided with a cholera epidemic that now has claimed more than 2,000 lives.
Last week, the state media reported that most teachers had left their jobs. As a result, the end-of-year examinations taken in November are yet to be graded after the markers demanded their wages in foreign currency. Schools are yet to re-open this year awaiting the examination results
I am aware of Zimbabwe's hyperinflation problems for some time now, but this is really really high. I used to joke that the best way to become a millionaire was to be born one, marry one or win the lottery. Now I found another way... go to a country whose currency is much weaker than yours. Given that this 100 trillion note is worth about $300 USD, any Australian with between 4-5 K would become a quadrillionaire in Zimbabwe.
On another note, I felt that these notes would be worth more money on the collector's market, and certainly a quick glance on Ebay confirms it. In fact I am feeling a desire to get one of these notes just to say I have it. Just don't spend it.
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I don't understand. Why do they do this to their currency? Can't they be extremely poor without having to resort to obscene numerals for their monies? Instead of having everyone resort to using ten billions of Zimbabwean dollars to buy a stick, can't they just adjust the numerals of their currency so that a stick will still cost ten Zimbabwean dollars (which will still be prohibitively expensive)? It doesn't have to change everything. Instead of everyone having ten billions of worthless Z-dollars filling their pockets, it'll just mean that no one has any Z-dollars at all but at least they'll have space in their pockets. That way, they'll have somewhere in their pants to keep their food-rocks so they won't be so hungry.
If it takes ten billions of Zimbabwean dollars to buy a stick, or if it takes ten Z-dollars to buy a stick but if a Zimbabwean has ten dollars then his neighbors would get really jealous and kill him and take his money and mud hut, does it really make a difference?
"DO YOU WORSHIP HOMOSEXUALS?" - Curtis Saxton (source) shroom is a lovely boy and i wont hear a bad word against him - LUSY-CHAN! Shit! Man, I didn't think of that! It took Shroom to properly interpret the screams of dying people - PeZook Shroom, I read out the stuff you write about us. You are an endless supply of morale down here. :p - an OWS street medic Pink Sugar Heart Attack!
Shroom Man 777 wrote:I don't understand. Why do they do this to their currency? Can't they be extremely poor without having to resort to obscene numerals for their monies? Instead of having everyone resort to using ten billions of Zimbabwean dollars to buy a stick, can't they just adjust the numerals of their currency so that a stick will still cost ten Zimbabwean dollars (which will still be prohibitively expensive)? It doesn't have to change everything. Instead of everyone having ten billions of worthless Z-dollars filling their pockets, it'll just mean that no one has any Z-dollars at all but at least they'll have space in their pockets. That way, they'll have somewhere in their pants to keep their food-rocks so they won't be so hungry.
If it takes ten billions of Zimbabwean dollars to buy a stick, or if it takes ten Z-dollars to buy a stick but if a Zimbabwean has ten dollars then his neighbors would get really jealous and kill him and take his money and mud hut, does it really make a difference?
It won't make any difference as long as the country's economy can't back up it's puchasing power. Countries usually replace their inflated money with a higher value one only after hyperinflation ends or curbed greatly. For example Hungary replaced the then worthless pengő with the Forint in 1946, or Rumania who replaced their inflated leu (ROI) with a higher valued "super" leu (RON) in 2005.
Shroom Man 777 wrote:If it takes ten billions of Zimbabwean dollars to buy a stick, or if it takes ten Z-dollars to buy a stick but if a Zimbabwean has ten dollars then his neighbors would get really jealous and kill him and take his money and mud hut, does it really make a difference?
Their problem is that the government's idea of how to pay for things is to print more money. This devalues the currency in circulation forcing them to print still more in a vicious circle.
folti78 wrote:It won't make any difference as long as the country's economy can't back up it's puchasing power.
It doesn't matter, as long as all those goddamn zeroes and those ridiculous numbers are cut down.
Teebs wrote:Their problem is that the government's idea of how to pay for things is to print more money. This devalues the currency in circulation forcing them to print still more in a vicious circle.
It's like as if I could run their country better than them... What's wrong with them? In the head, I mean.
"DO YOU WORSHIP HOMOSEXUALS?" - Curtis Saxton (source) shroom is a lovely boy and i wont hear a bad word against him - LUSY-CHAN! Shit! Man, I didn't think of that! It took Shroom to properly interpret the screams of dying people - PeZook Shroom, I read out the stuff you write about us. You are an endless supply of morale down here. :p - an OWS street medic Pink Sugar Heart Attack!
folti78 wrote:It won't make any difference as long as the country's economy can't back up it's puchasing power.
It doesn't matter, as long as all those goddamn zeroes and those ridiculous numbers are cut down.
They did do this back in August if I am not mistaken. They revalued their dollar so that a 10 billion dollar Zimbabwean note would now be equivalent to 1 Zimbabwean dollar note. This was the 3rd or 4th time they have done this, but because they have never solved the root of the problem, it quickly becomes useless.
Aren't foreign currencies and bartering the norm in Zimbabwe now? If I recall correctly I thought government officials were paid in USD and stores accepted foreign currency.
Shroom Man 777 wrote:Instead of having everyone resort to using ten billions of Zimbabwean dollars to buy a stick, can't they just adjust the numerals of their currency so that a stick will still cost ten Zimbabwean dollars (which will still be prohibitively expensive)?
Zimbabwe already cut ten zeroes off their currency - they did it in August. As the Associated Press puts it, "then The Herald newspaper cost 10 new Zimbabwe dollars. Today the paper costs $15 billion." Mind you, that was three days ago. With their 89.7 sextillion percent inflation I'm not sure how accurate that is at this time.
That's incredible. I mean, no one would expect this to happen in any sane world where people did things for reasons that're actually logical and, uh, reasonable. But it happens anyway! It's really amazing!
"DO YOU WORSHIP HOMOSEXUALS?" - Curtis Saxton (source) shroom is a lovely boy and i wont hear a bad word against him - LUSY-CHAN! Shit! Man, I didn't think of that! It took Shroom to properly interpret the screams of dying people - PeZook Shroom, I read out the stuff you write about us. You are an endless supply of morale down here. :p - an OWS street medic Pink Sugar Heart Attack!
It does appear there was at some point someone in the government who noted that devaluing the currency was a useless step. When they first began tackling the issue in late 2005/2006 the deputy finance minister stressed they needed to achieve inflation within double digits in order for it to succeed. Of course, they went ahead with it anyway before tackling inflation, and the continued devaluation has arguably worsened the situation by several degrees.
A somewhat amusing detail is that when they needed to print more money to pay for a massive increase in salary for government officials a few years back, they ran into trouble because they did not have enough foreign currency to buy ink or paper to print it on. In 2008, before the German government leaned on the printing company to stop printing, they were paying 500,000 Euros each time to receive 170 trillion Zimbabwean dollars a week.
The absolute first thing Zimbabwe has to do once that miserable creature Mugabe dies is stop printing so much fucking money and institute a sane monetary policy. Once they do that, people will start saving and they can actually start building an economy. The reason this hyperinflation is so devastating is that it kills the value of money between the time people get paid and the time they spend their money. Low-level inflation promotes consumption over saving by lowering the real interest rate, but hyperinflation essentially forces people to spend their wages ASAP; if prices increase 10% an hour, if you wait an hour to buy your food after you've been paid, you essentially lose 10% of your work day. Nobody is saving, nobody is investing; money is just circulating wildly and not doing anything.
A Government founded upon justice, and recognizing the equal rights of all men; claiming higher authority for existence, or sanction for its laws, that nature, reason, and the regularly ascertained will of the people; steadily refusing to put its sword and purse in the service of any religious creed or family is a standing offense to most of the Governments of the world, and to some narrow and bigoted people among ourselves.
Surlethe wrote:but hyperinflation essentially forces people to spend their wages ASAP; if prices increase 10% an hour, if you wait an hour to buy your food after you've been paid, you essentially lose 10% of your work day. Nobody is saving, nobody is investing; money is just circulating wildly and not doing anything.
It also creates a horrendous inflation trap where people demand big wage increases day on day in order to meet the expected levels of inflation. Businesses then have to up their prices to pay for the higher wages and so on.
Zixinus wrote:*yawn*, that's nothing compared to the 1 billion b-pengő (that's ten on the twentieth).
Yep, at the introduction of the 100 000 000 pengő, the bank dropped the idea of displaying the note's value numerically. It was shorter to write it in text first, but later they had to abraviate the last million (milpengő) or billion (bilpengő).
Also they are still behind pengő's 41,900,000,000,000,000% (4.9 * 10^16 %) monthly inflation, but not much...
mr friendly wrote:On another note, I felt that these notes would be worth more money on the collector's market, and certainly a quick glance on Ebay confirms it. In fact I am feeling a desire to get one of these notes just to say I have it. Just don't spend it.
The inflation is about a factor 100/month so wait a month and you can buy that 100 trillion Z$ bill for about 3 US$
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Aren't foreign currencies and bartering the norm in Zimbabwe now? If I recall correctly I thought government officials were paid in USD and stores accepted foreign currency.
US dollars are basically the currency of choice in Zimbabwe, beyond just high-government officials being paid in them.
Do you think you could cut off the Zimbabwean government's supply of US dollars, without basically causing the entire government to collapse and two-thirds of the population of Zimbabwe to flood into the neighboring countries?
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Aren't foreign currencies and bartering the norm in Zimbabwe now? If I recall correctly I thought government officials were paid in USD and stores accepted foreign currency.
US dollars are basically the currency of choice in Zimbabwe, beyond just high-government officials being paid in them.
Do you think you could cut off the Zimbabwean government's supply of US dollars, without basically causing the entire government to collapse and two-thirds of the population of Zimbabwe to flood into the neighboring countries?
You'd have to cut off the people who are buying stuff from them and paying in US dollars (I don't know what they have to sell anymore, but apparently you can always find something) and people who are sending money back home so their families can survive.
I've heard that one fourth of the population has already fled the country. That's probably part of the reason why their famines haven't gotten any worse, another part being that people are dying of AIDS faster than they can starve.
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Guardsman Bass wrote:Do you think you could cut off the Zimbabwean government's supply of US dollars, without basically causing the entire government to collapse and two-thirds of the population of Zimbabwe to flood into the neighboring countries?
The ones who remained would simply barter. In fact, I'll bet that the Zimbabwean economy now is chiefly bartering; I know if I were getting paid by the wheelbarrow-load, I would try to work out an arrangement with my boss.
Congratulations, Mugabe. You've done what nuclear powers only dream of: taken a country back to the stone age.
A Government founded upon justice, and recognizing the equal rights of all men; claiming higher authority for existence, or sanction for its laws, that nature, reason, and the regularly ascertained will of the people; steadily refusing to put its sword and purse in the service of any religious creed or family is a standing offense to most of the Governments of the world, and to some narrow and bigoted people among ourselves.
There's a quote from Mark Twain, from his trip around the world. He was in Alaska, speaking with an Es-ka-moe squaw (his words), whose father was considered rich for having 10 metal fishhooks. At the end of the story, Mark Twain quipped that if you wanted to be a millionaire, buy a handful of metal fishhooks and emigrate to Alaska.
Zimbabwe makes me think of that story.
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Nitram: You -are- beautiful. Anyone tries to tell you otherwise kill them.
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