(RXSD) Zimbabwe hyperinflation 'will set world record within sixweeks'

Zimbabwe hyperinflation 'will set world record within six weeks'

http://www.telegraph.co.uk

Inflation levels in Zimbabwe are running at 13.2 billion per cent
a month and could reach an all-time world record within weeks.


By Sebastien Berger, Southern Africa Correspondent

Last Updated: 5:34PM GMT 13 Nov 2008

Zimbabwe inflation -
Zimbabwe hyperinflation 'will set world record within six weeks'

Supermarkets in Harare are accepting only US dollars
and South African rands, leaving those Zimbabweans
without access to foreign currency in dire straits Photo: EPA

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.

The most famous hyperinflation, Weimar Germany in 1923,
is in a distant fourth place, at 29,525 per cent a month with
prices doubling every 3.7 days.

Prof Steve Hanke said: "They still have a way to go to catch
Hungary, but they are getting there. This is conjecture, but if
they keep going at this pace, they have a shot at it within a
month or maybe a month-and-a-half at the outside."

For ordinary Zimbabweans, the consequences are appalling
and they must spend money as soon as they get it before it
loses its value.

But the dysfunctional economy means that goods are in
desperately short supply, and they must spend hours foraging
to find things to buy.

There comes a point, though, where the inflation rate makes
little practical difference.

"The economy just stops functioning or slows down very much,"
said Prof Hanke. "A lot of barter takes place. Money is not used
as much or if it is, it's all foreign exchange."

Supermarkets in Harare are accepting only US dollars and
South African rands, leaving those Zimbabweans without
access to foreign currency in dire straits.

The latest official figure for inflation in Zimbabwe – dating
back to July – is 231 million per cent a year. Robert Mugabe's
government blames foreign sanctions for the economic turmoil.

Prof Hanke said the only way to stop the rise was to
abolish the Reserve Bank of Zimbabwe – which is a key tool
of the regime.

"At the end of the day, people will just refuse to use the
money. It will be just worthless and the Reserve Bank will
be useless too. The only way you can change expectations
about inflation in hyper-inflating countries is completely get
rid of the old system."

Announcing a range of measures this week, that only tinker
with symptoms of the problem, Gideon Gono, the governor
of the reserve bank, blamed a “breed of selfish and
unrelenting money launderers and speculators” for the crisis.

“The nation has to appreciate the magnitude of the
'sanctions’ and the mightiness of the enemies who are at
play in order to understand that we are at war,” he said.

For years, analysts and opposition politicians have
predicted that the economy would prove to be Mr Mugabe's
downfall, but Prof Hanke, who is professor of applied
economics at Johns Hopkins University, said that
Slobodan Milosevic survived for almost eight years
in Yugoslavia after hyperinflation peaked.

"The idea hyperinflation is going to blow Mugabe out of
there isn't based on historical experience.

"Milosevic and Mugabe are similar in more ways than one:
the restrictions on liberty of all sorts; Milosevic carrying on
just like Mugabe that it was the foreign sanctions that were
ruining the economy. It's very similar."

On Mon, 17 Nov 2008 19:32:36 -0800 (PST), "Blair (TC)"
wrote:

Zimbabwe hyperinflation 'will set world record within six weeks'

http://www.telegraph.co.uk


I hope not, but I called it quite some time ago.

snip

Supermarkets in Harare are accepting only US dollars
and South African rands, leaving those Zimbabweans
without access to foreign currency in dire straits Photo: EPA

Good!

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.

Yowsa...

snip

Prof Steve Hanke said: "They still have a way to go to catch
Hungary, but they are getting there. This is conjecture, but if
they keep going at this pace, they have a shot at it within a
month or maybe a month-and-a-half at the outside."

Except that the Zims have made a stride, much to the chagrin of some
stamp collectors. Hungary printed large sets with the Pengo and Ado
Pengo on them. The Zims are using NVI stamps. But, the Zims are not
to be outdone - their paper money is making up the slack!

For ordinary Zimbabweans, the consequences are appalling
and they must spend money as soon as they get it before it
loses its value.

This is where it hurts the most. :^(

snip

The latest official figure for inflation in Zimbabwe – dating
back to July – is 231 million per cent a year. Robert Mugabe's
government blames foreign sanctions for the economic turmoil.

Yep. The IMF and WB aren't going for the same old, same old. Sux for
the common Zim, but Mugabe needs a thrashing.

Prof Hanke said the only way to stop the rise was to
abolish the Reserve Bank of Zimbabwe – which is a key tool
of the regime.

That's one way!

"At the end of the day, people will just refuse to use the
money. It will be just worthless and the Reserve Bank will
be useless too. The only way you can change expectations
about inflation in hyper-inflating countries is completely get
rid of the old system."

Announcing a range of measures this week, that only tinker
with symptoms of the problem, Gideon Gono, the governor
of the reserve bank, blamed a “breed of selfish and
unrelenting money launderers and speculators” for the crisis.

Greed? Hmmm...

For years, analysts and opposition politicians have
predicted that the economy would prove to be Mr Mugabe's
downfall, but Prof Hanke, who is professor of applied
economics at Johns Hopkins University, said that
Slobodan Milosevic survived for almost eight years
in Yugoslavia after hyperinflation peaked.

"The idea hyperinflation is going to blow Mugabe out of
there isn't based on historical experience.

Nope. The people need to rise up and say they aren't going to take
Mugabe's poop any more.

Gee... doesn't this sound eerily familiar?

"Milosevic and Mugabe are similar in more ways than one:
the restrictions on liberty of all sorts; Milosevic carrying on
just like Mugabe that it was the foreign sanctions that were
ruining the economy. It's very similar."

Mugabe made a mess and now it shows. Period. I'm terribly surprised
why nobody has cut him down because of this mess. Many a greater man
in Africa was killed for much less - ahem - alleged conduct.

Let's see if the Zim military, paid with useless Zim $, attempts to
move in on the DRC's Katanga and South Kasai provinces. Hopefully
Nkunda's rebel forces in the Kivu region of the DRC are stopped or at
least they come to some democratic solution. If not, the Zims may be
in a bigger pile 'o poop and we may have the 2nd African "World War".

BTW, not many people paid much attention to the 1st African "World
War", but 5 million people paid the ultimate price.

....and these are some of the countries, with their stamps, that have
enticed us as youngsters. So quickly we can forget.

......and from another time, a lovely Adenium on a Zimbabwe Cinderella.

http://cjoint.com/data/lse5Sgi7RS.htm



"Blair (TC)"
Zimbabwe hyperinflation 'will set world record within six weeks'

"Blair (TC)" wrote in message
...

Zimbabwe hyperinflation 'will set world record within six weeks'

http://www.telegraph.co.uk

Inflation levels in Zimbabwe are running at 13.2 billion per cent
a month and could reach an all-time world record within weeks.


By Sebastien Berger, Southern Africa Correspondent

snip

"The idea hyperinflation is going to blow Mugabe out of
there isn't based on historical experience.

Yep.


"Milosevic and Mugabe are similar in more ways than one:
the restrictions on liberty of all sorts; Milosevic carrying on
just like Mugabe that it was the foreign sanctions that were
ruining the economy. It's very similar."


The name of the similarity between both is socialism.

--
Victor Manta

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