The Ghost of Inflation Future
James Poulos, Ed. ·
Oct 2, 2010 at 10:27am
Not that I'm a scaremonger or anything, but this sad image had me gazing for a long time:
Economic policies have consequences.
(Via Alan Jacobs.)
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Jun '10
Re: The Ghost of Inflation Future
...and it's dual-use. It doubles as Sheryl-Crow-approved toilet paper.
Edited on Oct 2, 2010 at 10:47amMay '10
Re: The Ghost of Inflation Future
I don't understand currency like this. Rather than keep the same symbol-to-value (dollar-to-commodity) ratio, why don't they adjust?
Maybe I'm saying this poorly. Printing billion-dollar bills and requiring citizens to load wheelbarrows with thousand-dollar bills to buy bread doesn't make sense to me. Currency is symbolic. Its relative value is more important than its exact value.
Are people not capable of understanding the change in relative value without all the zeroes on the end? Is it not possible to phase up or down the value of a dollar without printing or burning money?
Or perhaps the point is moot. If billion-dollar bills are necessary, people probably revert to a barter system.
Macroeconomics was never my strong point.
May '10
Re: The Ghost of Inflation Future
I was in Zimbabwe back in '97 and again in '99. At that time the exchange rate was twenty Zim dollars to the US dollar. The first time we stayed at a hostel run by a Mennonite family in Bulawayo, and walked downtown for ice cream at the Woolworth's. I can't imagine either are there anymore. In primary school we were taught Zimbabwe was the only other country in southern Africa that was self sufficient, and they would even field a competitive national cricket squad certain years. The rock formation (The Balancing Rocks) on that note is the same as that on the old fiver; those rocks haven't changed. It's everything else that has.
Sep '10
Re: The Ghost of Inflation Future
I've seen 100 trillion Zim dollar notes, but I understand that Zimbabwe recently re-issued their currency with 12 zeros lopped off. During the worst of it, some Zimbabweans resorted to commodity money by carrying around liters of petrol. By the way, they had giraffes on some of their currency which was much more cool than rocks.
At one point, the Zimbabweans were all trillionaires and were so rich that they could afford to heat their homes by burning their money.
Oct '10
Re: The Ghost of Inflation Future
Barter is a very attractive option when taxes are high as well as in inflationary times. And surely gold looks more and more like a value holder. Governments can't print more gold.
May '10
Re: The Ghost of Inflation Future
I love Zimbabwe. Lived in Bulawayo back in the mid 70's when I was a kid. Zim used to export food, tobacco, and some minerals and had a reasonably well-educated populace with high literacy rates. While the droughts didn't help, this was all ruinously stupid economic and political policies.
Zimbabwe deserved better.
Regardless of the fictional value of the Zim dollar, it doesn't much matter if there is nothing on the shelves. A few years back, one of my favorite sites noted that if a domestic worker who made Z$120,000 per month could find a tin of jam, they would have to save every cent of their salary for four months to buy that jam. If they could find it, that is, but they couldn't because gov't price controls went into effect and emptied the shelves.
Large portions of their economy already went underground, but without hard currency, many products that used to flow into the country simply stopped.
On the plus side, I think that the economy has mostly bottomed out. Not much room left for down, if you take my meaning.
May '10
Re: The Ghost of Inflation Future
There are good books out there about the hope and tragedy of Zimbabwe. Our Votes, Our Guns by Martin Meridith and Where We Have Hope by Andrew Meldrum were both quite good. When A Crocodile Eats the Sun is another good one, but I can't find my copy of it right now.
And if you want to keep up with what is going on in Zimbabwe from an opposition point of view, this is a decent place to go:
http://www.sokwanele.com/thisiszimbabwe/
Not quite so directly politically oriented, Alexandra Fuller's Scribbling the Cat and Don't Let's Go to the Dogs Tonight are both very interesting reads.
May '10
Re: The Ghost of Inflation Future
Piker. The final Zimbabwean ? bill was a face value of 100 Trillion. The following signs appeared in bathrooms:
TOILET PAPER ONLY
To Be Used in this toilet
NO CARDBOARD
NO CLOTH
NO ZIM DOLLARS
NO NEWSPAPER
you can see the sign at
http://moneytipcentral.com/wp-content/uploads/2009/03/zim-dollars-toilet-paper.jpg
Aug '10
Re: The Ghost of Inflation Future
Isn't this bill supposed to have Jimmy Carter's face on it?