Monday July 21, 2008

Hyperinflation : Zimbabwe introduces $100 billion dollar banknotes

This article belongs to the Zimbabwe inflation watch story arc.

channelnewsasia.com, cnn.com :

Zimbabwe, grappling with a record 2.2 million percent inflation, has introduced new $100-billion-dollar currency notes in a bid to tackle rampant cash shortages, the central bank said. The new note will go into circulation on Monday [21 Jul 2008]. As high as they are, though, the bills still aren't enough to buy a loaf of bread. They can buy only four oranges. The new note is equal to just one U.S. dollar.

Zimbabwe has been ravaged by hyperinflation which shot up from 165,000 percent in February to 2.2 million in June. Independent economists however believe the official inflation figure is grossly understated, estimating it could be running between 10 million and 15 million percent. Zimbabwe's chronic economic crisis has left at least 80% of the population living below the poverty threshold and mass shortages of basic goods in shops.

Zimbabwe's hyperinflation is running faster and faster. It has got to be the one place in the world where the weakening US dollar is still welcomed with open arms, and that's only because the local currency is a hundred billion times weaker. Just 2 months back, they introduced the $500 million dollar notes, and now they have these $100 billion dollar notes. So they are adding a zero to the currency roughly every month. After they hit trillion and then quadrillion, either scientific notation would have to come in or people would have to start grappling with such exotic words as quintillion, sextillion, septillion and so on. If they don't collapse entirely or turn around by then, their people could be turning into septillionaires and yet are none the richer.

See also :

1. Zimbabwe inflation hits 165,000%
2. Zimbabwe adds $500 million dollar note as hyperinflation runs on
3. Runaway hyperinflation : Zimbabwe inflation rate now over 1 million percent
4. Runaway hyperinflation : Zimbabwe inflation rate hits 2.2 million percent officially

(2008-07-21 09:16:53 SGT) [Biz] Permalink Comments [1]

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