Not your money’s worth

I met John Robertson today, a local economist whom I have always admired for his common sense and willingness to speak truth to power.

He said the game changer in Zimbabwe has been the “dollarization” of the economy in 2009, which has restored a degree of order to the marketplace. Prior to that, hyperinflation, combined with a unrealistic official exchange rate, made it virtually impossible to conduct business—at least for reputable businessmen.

A leaf buyer told me that when he and his friends would play a round of golf, they would buy the beer they planned to drink afterward prior to the match because its price was likely to double during the game.

Quotes for services were valid for just one hour, and the banknotes could barely accommodate all the zeros. I think the last Zimbabwean dollar bill to be issued was a 100 trillion-dollar note—the equivalent of a few U.S. dollars—less toward the end of the week.

Of course there are always people who thrive in such an environment—those with debts, for example. And before the government switched to the U.S. dollar, the Harare stock market was said to be the best performing in the world.