Don't mean to be alarmist or anything, but I do sleep better knowing that my readers have a better chance of feeding their families and their neighbors in the future. Remember: FOOD GOOD. STARVATION BAD. GET FOOD. For those of you caught up in the in-depth coverage of Presidential candidates, maybe I should out it this way: Food is even better than hope, change, experience, and being a war hero. Vote for food. Buy food now.
The Zimbabwe dollar used to be about equal to the US dollar a couple decades ago. Today, one US dollar is worth 594,187,320 Zimbabwe dollars. A year ago, the inflation rate was 1200% (see a news video from April 2007). Today it's at least 24,000% (that's the rate we had in February, per CNN. Could similar hyperinflation happen here? We have a lot propping up the dollar - but when a nation chooses to devalue its currency and use printing presses to satisfy insatiable appetites for spending, it cannot continue this forever without disaster. We are on a dangerous path.
Here's part of Adrian's article:
The first quarter monetary policy update from Dr. G. Gono, the Governor of the Reserve Bank of Zimbabwe COMMENDS his peers, the world over. Referring to the United States and the United Kingdom. Dated April 30th, 2008. Pages 8 through 12 – Point 1.14 to 1.29. (http://www.rbz.co.zw/pdfs/2008%20MPS/AprilMPS2008.pdf)To the Saints and all others in Zimbabwe, I'm so pained at that is happening to your beautiful nation. May there be real change, real hope, and real help shortly. And to all of you living in more prosperous circumstances, prepare now to help your family and others overcome whatever financial crises are brewing. They can come swiftly and unexpectedly.
Permit to quote. (I especially like his use of bolding – I added bolding where he did).1.14 Equally also, our thrust has been founded on our unwavering belief that extraordinary circumstances must be confronted through extraordinary interventions and not through half baked or even wholesale 16th century economic dogmas that have been long discarded in their founding countries.
1.15 As Monetary Authorities, we have been humbled and have taken heart in the realization that some leading Central Banks, including those in the USA and the UK, are now not just talking of, but also actually implementing flexible and pragmatic central bank support programmes where these are deemed necessary in their National interests.
1.16 That is precisely the path that we began over 4 years ago in pursuit of our national interest and we have not wavered on that critical path despite the untold misunderstanding, vilification, and demonization we have endured from across the political divide.
1.22 Here in Zimbabwe we had our near-bank failures a few years ago and we responded by providing the affected Banks with the Troubled Bank Fund (TBF) for which we were heavily criticized even by some multi-lateral institutions who today are silent when the Central Banks of UK and USA are going the same way and doing the same thing under very similar circumstances thereby continuing the unfortunate hypocrisy that what's good for goose is not good for the gander.
1.26 As Monetary Authorities, we commend those of our peers, the world over, who have now seen the light on the need for the adoption of flexible and practical interventions and support to key sectors of the economy when faced with unusual circumstances.
1.27 Of course, in the short term such interventions are without doubt inflationary but in the medium to long-term they trigger and propel economic growth and development that everyone craves for.
Later on in the document you learn the unsecured lending rates were raised to 5000% from 4500%. Page 46.
Of the 309 registered microfinance/money lending institutions only 184 are still operational. Page 61.
In other words bank failures and hyperinflation appear to go hand in hand.