Monday, May 16, 2011

Hyperinflation Zimbabwe Style

A recent article in the WSJ prompted me to make an eBay purchase - of 100 trillion dollar bills in Zimbabwe currency, the highest units of currency ever printed. Someone is making a fortune on these now defunct bills that are worthless in Zimbabwe. However, I think they will make a nice prop for class. (see WSJ 5-11-11, "Zimbabwe's 100-Trillion-Dollar Bill Is a Hot Collectible"). 

People in Zimbabwe now use the U.S. dollar or South African rand to conduct transactions. Zimbabwe is not alone in using the U.S. dollar as currency. Some countries use the U.S. dollar as their official currency (ex: Ecuador, El Salvador, and East Timor). Other countries set a fixed exchange rate between the local currency and the U.S. dollar, and accept dollars in transactions (ex: Panama, various Caribbean islands, and Lebanon). In yet more countries, the U.S. dollar is not the official currency or linked by a fixed rate, but is still accepted in transactions (ex: Peru and Uruguay).

To get an idea of what it was like to live through hyperinflation in Zimbabwe watch,

Uploaded onto YouTube by  on Aug 19, 2008

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