By Tyler Durden
The Return Of Hyperinflation In Zimbabwe
Authored by Pavel Mordasov via The Mises Institute,
It has been over a decade since Zimbabwe was ravished by one of history’s worst experiences in hyperinflation, reaching 79,600,000,000 percent as prices doubled approximately every 24.7 hours in November of 2008. Today under new leadership, it seems as though the government of Zimbabwe has failed to learn from its previous mistakes in what policy to ascribe to as it enters into another period of tumultuous times and economic hardship for its citizens as hyperinflation has entered the picture again.
Zimbabwe’s horrendous experience with hyperinflation came from monetizing its expenses as a result of several years of failed political reforms such as confiscation of agricultural properties and price controls. This resulted in GDP declining -17 percent in 2008 (see Figure 1). With Zimbabwe’s practice of printing money, the government decided in 2009 to abandon their local currency and replaced it with foreign currency such as the US dollar and African Rand, which helped provide more stabilization.
Figure 1: Source: World Bank (Zimbabwe GDP 2008–2018)
However, after its rapid expansion …read more
Source:: Zero Hedge