How many zeroes can you think of – Try Zimbabwe Bank notes and play in Billions or Trillions

Imagine a situation – a $ 5 could buy you enough bread in India while in Zimbabwe, back in 2008, 700 million Zimbabwe dollars bought a loaf of bread. Playing in Billions/Trillions had been a fun in Zimbabwe until the government abandoned its currency in early 2009 and decided to revalue its currency, removing 12 zeroes. Now, 1 trillion in Zimbabwe dollars is equivalent of one Zimbabwean dollar. Under the new valuation, the largest note is a 500-dollar Zimbabwean dollar. Earlier, the largest Zimbabwean bank note was for 100 trillion dollar (wow...hope India would become a $ 100 trillion dollars soon) and one U.S. dollar was worth more than 300 million Zimbabwean dollars. 

Hyperinflation or Deflation?

Currently, the world is divided into groups – with one set of countries majorly developed states flirting with the deflation and another set of countries majorly developing states like China, India etc battling to control burgeoning inflation. India has a serious concern on inflation due to structural issues on which the central bank has raised it many times. Recently, the RBI governor D Subbarao commented – “When I meet other central bank governors, they tell me `why don't you give us a bit of your inflation. That's how desperately they want some inflation and how desperate we are to control inflation”.

The hyperinflation has its own history.  Prof. Steve H. Hanke, Professor of The Johns Hopkins University and Senior Fellow of The Cato Institute has calculated the highest monthly inflation data as given below:

So, it is not only Zimbabwe but other countries like Hungary and Germany have also faced the hyper inflation in the past. Still, Hungary holds the record with the highest monthly inflation rate in the past. 

Now soiled Zimbabwean Dollars find new takers..

Western visitors to Zimbabwe are looking for zeros. They are toying with the soiled Zimbabwe bank notes, not in circulation now, most notably the one hundred trillion Zimbabwe dollar bill as an economic souvenir. The report says

The one hundred trillion Zimbabwe dollar bill, which at 100 followed by 12 zeros is the highest denomination, now sells for $5, depending on its condition. That bill and others -- among them millions, billions and trillions, were abandoned nearly two years ago, when the American dollar became legal tender in the hopes of killing off the record inflation that caused all those zeros.

"I had to have one," said Janice Waas on a visit to the northwestern resort town of Victoria Falls. "The numbers are mind bending." She got her so-called "Zimdollar" in pristine condition, from a street vendor who usually sells African carvings.

Call it the passion or curiosity; everyone now wants to get a pie of it. No wonder inflation – be it hyperinflation or deflation is a weapon of mass devastation. Hope in India, someone must be listening!

Happy Reading!

- Amar Ranu