The Zimbabwean government has just announced that they will begin printing 100 trillion dollar notes in order to keep up with hyperinflation, an epidemic that has brought the once prosperous nation to its knees. For all of you that are dazzled by large numbers, don't be. With a loaf of bread currently selling for 300 billion Zimbabwe dollars (and increasing everyday), this note will eventually become useless as well. Combine that with an announced inflation rate of 231 million percent (as of July 2008), one has to figure the debut of the $100 Quadrillion note isn't far off. Even more likely though is the phasing out of the Zimbabwe dollar. Doctors and nurses have been on strike since September after demanding to be paid in US dollars. Said strike carries an enormous price - no pun intended - as a cholera outbreak has already claimed 2,000 lives. Teachers have now walked out as well, leaving exams ungraded. Vendors already greatly prefer to be paid in foreign currencies, and it is only a matter of time before they refuse to exchange their goods for Zimbabwe dollars altogether.
I'm posting this article partly to introduce some levity this weekend, but also to forewarn my American comrades of the inflationary period that is sure to come as our economy starts to "recover." While we will never see inflation soar to levels anywhere near 231 million percent annually, I fear that the US will be smacked with double-digit inflation by 2010. Creating credit and currency out of thin air to bail out every Tom, Dick and Harry willy surely have its consequences. As if the TARP fund wasn't enough, the incoming Obama administration, with the backing of the US Congress, just rolled our plans for a $750 Billion stimulus package. Now this wouldn't be so bad if we were talking Zimbabwe dollars, but unfortunate this is 750 billion US greenbacks. If you think it will stay at $750 Billion, you're crazy. It will reach $900 Billion easy, maybe even $1 Trillion. Keep in mind that is is on top of a budget deficit that already tops $1 Trillion and a national debt that has reached fourteen figures, as in $10 Trillion. Every time bailouts and spending programs are introduced, it just means more money is borrowed from China, India, Japan, and many other nations around the world, friends and foes alike.
Don't say you haven't been warned. You'll know things are bad when bread is in the billions. Just ask Mugabe.
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