Sunrise, sunset?

29 12 2007

On Christmas Day I went out to lunch with friends. Amongst those present was John Robertson, an oft-quoted local economist. Of course amongst the topics of conversation were the usual; who’d bought what where and inflation. John mentioned that he’d got hold of some figures from Germany in 1922-3 when they had experienced their legendary inflation and doing a bit of comparison it seemed that our inflation was not that far off what theirs had been. Of course for them it led to Hitler and the Third Reich but for us the outcome is not likely to be so dramatic; “Bob and the Fourth Chimurenga” is more likely (chimurenga is Shona for “revolution” – and yes there have apparently been three previous ones but who noticed?). John had also had a meeting with some IMF officials who came calling for an update on the Zimbabwe situation. When pressed they’d admitted that their forecast figure of 100,000% (yes, one hundred thousand percent) inflation for Zimbabwe was approaching a bit faster than they’d expected.

The officials who “control” the Zimbabwe economy (put in quotes because they very obviously don’t) have come up with a new strategy called Operation Sunrise 2 which involves revaluing the currency by knocking off an unspecified number of zeros and re-issuing the currency in the form of new notes (see “It’s not real money”). It seems to have gone a little awry. Only the new $750,000 and $500,000  notes have been seen and not in sufficient quantities to alleviate the queues at the banks. Money is deposited and goes straight out again. The banks have taken to giving out the $200,000 notes again even though they are due to expire (yes, expire!) on Tuesday. People are so desperate to have something to spend that the banks have no choice and the Reserve Bank is not supplying enough new notes. Perhaps the printing presses are broken? Nobody knows or they are not telling if they do!

During a pre-Christmas interview, Dr Gideon Gono, the Reserve Bank Governor, was responding to questions on Sunrise 2. When it became apparent that zeros were not going to be removed from the new currency a reporter asked how businesses were going to cope with not being able to have enough “space” on the computer software to deal with all the existing zeros. The reply went along the lines of – well, they will just have to go back to using paper won’t they? And he’s a doctor? Of what exactly?

Also just before Christmas I had a salesman come in and sell me a new toner cartridge for the office printer. He obligingly took a cheque and then took a while to read it. I asked if there was a problem. Oh no, I’m just counting the zeros, he said.



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