Posted on 05/31/2006 11:53:41 PM PDT by MadIvan
A NEW $100,000 banknote will be issued in Zimbabwe today. With a value of about 67p, it is worth only the price of a loaf of bread.
Its introduction comes as the economy buckles under the highest rate of inflation in the world, currently at 1,042 per cent. The note makes its debut barely four months after the Reserve Bank introduced the $50,000 note, the highest denomination at the time. In only two weeks the Zimbabwe dollar has lost half of its value.
Despite the hyperinflation, mass unemployment and crippling shortages of fuel and foreign currency, Zimbabwe is a country of millionaires. Shoppers have to carry huge wads of cash to buy the basic foodstuffs available in most shops.
“Last week I filled a single trolley with $30 million of groceries, and I had to count out 600 notes of $20,000 at the checkout counter,” John Robertson, an economist, said.
Despite the economic gloom, he said that at least the new note “means when we go shopping, we don’t have to take a suitcase of money: we can carry it in a shoulder bag”.
As the Government announced the introduction of the note, queues were forming outside banks that had begun to limit withdrawals because of the latest shortage of currency. All coins disappeared from circulation two years ago.
Gideon Gono, governor of the central bank, said that the note was being introduced “to ensure convenience to the public”. Although he predicted that inflation would be down to 50 per cent in a year’s time, he held out the prospect of even bigger denominations if the new note failed to ease the banking problems.
Zimbabwe used to boast one of Africa’s most robust economies, but eight years of recession and a radical programme of land redistribution has left millions in poverty.
In its relentless search for cash to fill its empty treasury, the Government last week imposed a punishing new tax on the stock market. Brokers immediately halted trading, losing the state tax revenue equal to £17,000 a day.
On Monday the Government declared potatoes a “strategic crop” after realising that “the country cannot continue depending on maize alone for its food security”.
All sales of potatoes, which cost ten times as much as maize meal, can now be handled only by the Government.
Gee... I wonder what happened.
An excellent lesson for Demoncrats (or Labour Party) who want to raise taxes on the "rich." When you raise taxes, you get less because people avoid the activity that causes the tax.
I think I read an article recently which stated that the government over there didn't have enough money to purchase the ink and paper needed to print the new bills.
Too funny.
L
Oh, that'll insure an bounteous supply of spuds, won't it? I mean, after the government forces everyone on to collectivist farms to grow them.
But, hey, at least they're not under the horror of aparthied, right? (sarcasm)
Or under Lenin from 1918-1920, when the government ended up having to sell some of the gold "inherited" from the Tsar's treasure in order to buy ink from the West...so it could print up more money.
I have been to Kenya and South Africa - based on my experience there, the poverty in Africa has absolutely nothing to do with the people - there are loads of enterprising and imaginative individuals there who work very hard. The problem lies in the lack of the rule of law and corrupt government. If that burden was ever corrected, Africa will surprise many people.
It was said of Angola, while it was under Portuguese rule, that it was "so rich, so beautiful, put a dead branch into the ground and it would grow". What Africa perhaps needs is to realise that rejecting the colonial legacy entirely was not the right way to go. Mozambique has learned this, South Africa appears to understand this, if partially - once this lesson is learned, there is no limit to Africa's potential.
Regards, Ivan
A significant problem in many developing, former colonial countries in Africa and elsewhere, including Iraq, is that in order to divide and rule, the colonial powers drew boundries that mixed opposing and hostile tribes into the same country. Nigeria is a good example, with Housa, Yoruba and Ibo tribes. Some may remember the nasty little anti Ibo war they had some years back. Now there is conflict with the northern Islamics and the southern Christians.
Of course the conflict created by the British by drawing the boundries for Iraq with Kurds, Sunnis and Shiites is very obvious today. Its a shame we couldn't have an international boundry redrawing commission.
Another example:
Note the GDP per head, very respectable.
Regards, Ivan
What they need is a Federal Reserve System!
/sarc
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Right, and anyone who thinks it can never happen here should take note of the fact that thirty years ago the idea of paying $100,000. for a house sounded strange to most of us and anyone who made $10. an hour was very well off indeed.
a sad place. I send money to some African sisters to pay their family's school fees, but they end up using it to buy food.
This is what happens when do-gooders replace a working government with trash.
What happens when communism takes control.
This corrupt government seized farms from white owners.
This rampant inflation is just another way of seizing the assets of anyone who was foolish enough to remain in the corrupt country.
It's too bad that the people are suffering, but it's the fault of the corrupt communist government.
Damn well said, sir!
Well said Frohickey: plus you just stopped this thread becoming a tedious game of PC tennis.
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