Hyperinflation

Ever heard of the word hyperinflation? It's a condition in which prices increase rapidly as a currency loses its value.

The most recent occurence of hyperinflation is in Zimbabwe. Hyperinflation in Zimbabwe began in the early 2000s, shortly after Zimbabwe's confiscation of white-owned farmland and its repudiation of debts to the International Monetary Fund, and persisted through to 2009. Figures from November 2008 estimated Zimbabwe's annual inflation rate at 89.7 sextillion (1021) percent. In April 2009, Zimbabwe abandoned printing of the Zimbabwean dollar, and the South African rand and US dollar became the standard currencies for exchange. The government does not intend to reintroduce the currency until 2010.

If you read in wikipedia, The Reserve Bank of Zimbabwe issued a ZWD 10,000,000 note in January 2008, roughly equivalent of 4 US dollars. Zimbabwe's inflation soared to a record high of 26,470.8 percent as the economy contracted by 6 percent, the central bank said.


In April 2008 the Reserve Bank of Zimbabwe issued a ZWD 50,000,000 note, which was then worth approximately 1.20 US dollars. In May 2008 the Reserve Bank of Zimbabwe issued bank notes or rather "bearer cheques" to the value of ZWD 100 million and ZWD 250 million. Meanwhile inflation had surged to an estimated 165,000 percent with some unconfirmed reports putting the figure as high at 400,000 percent. Ten days later, new notes with a value of ZWD 500 million (then equivalent to about USD 2) were issued.

By the beginning of July 2008, official figures put the inflation rate at 355,000 percent and with some independent estimates as high as 8,500,000 percent. By July 4, 2008 at 5.00pm, a bottle of beer cost $100 billion Zimbabwean dollars, but an hour later, the price had gone up to $150 billion; the Los Angeles Times further reported on July 15, 2008 that the printing presses were running out of paper to print the money, and it was feared that because of human rights concerns, Germany would cut off the supply of paper and the software license for creating designs for even higher denominations of currency. On July 16, the official inflation rate was reported by Zimbabwe's central bank as 2.2 million percent.

"Hi...thanks for the tip.."

Can you just imagine living in a such terrible financial crisis?
No wonder the price of gold is shooting up nowadays.