
2006 Articles 25 Dec Unexpected 20 Dec Darkest Hour 18 Dec 4 More Years 11 Dec Fiddling 30 Nov A Queue! 20 Nov Breaking Records 10 Nov Disappointed 2 Nov Spring In Zim 29 Oct How long Oh Lord? 28 Oct Poverty & Leadership 18 Oct Farm Situation 15 Oct Millstones 13 Oct Silent Cities 9 Oct Hwange 3 Oct To Protect 25 Sept Alice in W.land 18 Sept Next Week 17 Sept 7 Years 8 Sept Magic Matopos 5 Sept Lousy Year 21 Aug Let my people go 5 Aug Living on the Edge 4 Aug More Chaos 2 Aug New Beginnings 1 Aug Chaos 31 July Morgan Tsvangiryi 25 July End in sight? 16 July Regional Impact 12 July The Big Dick 5 July Leadership 3 July Walking on Water 18 June Into the breech 13 June Break through 3 June Tiger Fishing 31 May Remembrance Day 23 May Prognostications 18 May Floating 14 May The Winter 7 May How Long? 5 May May Day 25 Apr People Power 20 Apr Statistics 18 Apr Chernobyl 10 Apr Rats! 7 Apr Paranoia 4 Apr Running out of time 1 Apr Making a Difference 25 Mar Self Destruction 20 Mar Political Trees 12 Mar Funding 11 Mar Directions Please? 26 Feb An African Storm 23 Feb Getting it all wrong 21 Feb Deliberate Confusion 12 Feb Racist Rantings 5 Feb What Next? 31 Jan The Crunch 29 Jan Starving Children 21 Jan Its not cricket 18 Jan Letter to R.M. 15 Jan Absolute Nonsense 9 Jan New Strategies 8 Jan Funding 2 Jan Options
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Complete Pandemonium
Today - the day after Gideon Gono, the Governor of the Reserve Bank,
announced the reduction of the numerical values of the Zimbabwe dollar
by
three digits, has been characterized by chaos and confusion.
Barclays Bank and Beverly closed their doors; Standard Bank traded but
advised their clients to write Cheques using the new denominations with
the
endorsement 'Revalued' on the cheque. Zimbank simply traded as normal -
refusing to issue the new currency. Major firms closed for the day to
try
and sort themselves out before reopening. Others refused to accept
Cheques
and the 'old currency' which technically now is illegal tender. Others
simply continued trading as if nothing had happened.
Everywhere the business community was trying to sort out what to do -
close
their accounts, take stock, get balances from the Bank and then reopen
with
a new set of accounts and data on their computers. How to work the new
numbers with Cheques still coming in and both types of currency in
circulation?
The new notes have not put in an appearance yet but it is clear that
when
they do this will create yet more confusion - they are in the following
denominations (all paper 'bearer bonds': -
1 cent, 5 cents, 10 cents, 50 cents, 1 dollar, 5 dollars, 10 dollars
etc. up
to 100 000 dollars. The first note is worth 10 'old' dollars, the last
is
worth 100 million 'old' dollars. The cost of printing the smaller
notes,
which will be virtually worthless, must have been at least 50 new
dollars
per note (50 000 'old' dollars) so the loss on this operation must run
to
many billions of 'old' dollars. A complete waste of money as the only
unit
that makes any sense is the 1 dollar note and even then this is so
small as
to be a nuisance. The 100 000 note will attract the forgers big time!
It is clear there was very little consultation and planning for this
huge
exercise. I am told the Police have desended on Beitbridge in force to
stop
people bringing the missing trillions back into the country! I feel
sorry
for all who must now go through the hoop at the border posts. What a
waste
of time and energy.
One immediate casualty - the parallel market has gone crazy, the dollar
is
trading at 80 000 to 1 on the Rand, 750 000 to 1 on the US dollar and
over a
million to the pound Sterling. It is still moving and goodness knows
where
it will end. The slashing of interest rates will force surplus money
into
the stock market and we can also expect equitiesd to go into the
stratosphere. Fuel is trading in a confused market at 600 000 'old'
dollars
today.
Eddie Cross
1st August 2006
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