Skip to comments.Zimbabwe Central Bank urges gold-backed Zim dollar, warns US Dollars days numbered
Posted on 05/15/2011 7:08:04 PM PDT by DeaconBenjamin
THE central bank says the country must consider adopting a gold-backed Zimbabwean dollar warning that the US greenbacks days as the worlds reserve currency are numbered.
Government ditched the Zimbabwe dollar in 2009 after it had been rendered worthless by record inflation levels and adopted multiple foreign currencies with the US dollar, the South African Rand and the Botswana being the most widely used.
Finance minister Tendai Biti says the country needs at least six months import cover and a sustainable track-record of economic growth, inflation stability and above 60 percent capacity utilisation in industry before the Zim dollar can be brought back into circulation. However central bank chief, Dr Gideon Gono said the country should consider adopting a gold-backed currency.
There is a need for us to begin thinking seriously and urgently about introducing a Gold-backed Zimbabwe currency which will not only stable but internationally acceptable, he said in an interview with state media.
We need to re-think our gold-mining strategy, our gold-liberalisation and marketing strategies as a country. The world needs to and will most certainly move to a gold standard and Zimbabwe must lead the way.
Gono said the inflationary effects of United States deficit financing of its budget was likely to impact other countries to leading to a resistance of the green back as a base currency.
The events of the 2008 Global Financial Crisis demand a new approach to self reliance and a stable mineral-backed currency. To me, gold has proven over the years that it is a stable and most desired precious metal, Gono said.
Zimbabwe is sitting on trillions worth of gold-reserves and it is time we start thinking outside the box, for our survival and prosperity.
You know we’re screwed when even Zimbabwe knows the dollar is screwed.
Even they can see the effects of progressive bullish*t
That would be a hoot, if I didn’t have a lot of friends and family who will suffer from this horrible financial mess.
It’s pretty scary when reality seems like outrageous satire.
It's worse - they're trying to figure out a way to defend themselves from the consequences of a collapsing dollar... The Zims on the gold standard... is this my world?
I believe the US dollar is the currency of choice and most widely used currency in Zimbabwe.
Zim? Mugabee? Zimbawe??
What a hoot. What was the inflation rate in Zimbawe last year??? Do you need the wheelbarrow yet??
Stupid, Stupid, Stupid.
Last time I heard it was something like 4-6%. Zimbabwe hyperinflated and crashed, but since they couldn't make anything worse, things have started to get better.
That is indeed funny, given their track record.
That is interesting. Mugabee the insane Commie Dictator has been taking lessons for the smarter Commies in China. He has a villa there and is educating his daughter in China from what I have heard.
They have plenty of gold reserves and with the Chinese tech know how it will be recovered. Slave labor is the rule there like most Commie Countries.
Now, the Chinese are a threat and they have a pact with Mugabee. He is suddenly acceptable, although still an insane brutal bastard begging for a golden BB.
What a mess.
...says the country must consider adopting a gold-backed Zimbabwean dollar warning that the US greenback's days as the world's reserve currency are numbered.To that end, Zimbabwe plans to invade and conquer South Africa, which has gold mines.
How many Mugabe mansions will have to be sold to get enough gold to back the country’s new gold standard??
yeah right. the world is going to trust Zimbabwe bucks over American.
According to sources, representatives Bankers Association of Zimbabwe led by its president and FBC Bank boss John Mushayavanhu met Finance minister Tendai Biti last week to map a way forward in dealing with change problems in the economy.
The sources, said the US Federal Reserve have formally agreed that Zimbabwes economy is now dollarised and will now supply Zimbabwe with coins and replace notes.
Officials from the Finance ministry will soon depart for the US to airlift the coins to Zimbabwe, the source said. Banks and government, according to the sources have agreed to charter an Air Zimbabwe flight to pick up the coins in the US. The flight costs will be met by both government and banks.
Zimbabwe has been saddled with change problems since the introduction of multi-currencies in February 2009.
Retailers are offering consumers credit notes, tokens and even sweets to settle small change.
Mushavanhu on Wednesday declined to comment on the matter referring all questions to Biti who was unreachable at the time of going to press.
In his 2011 budget statement, Biti said government had engaged the United States Federal Reserve over possible provision of coins and replacement of soiled notes to ease small change problems in the country.
Biti said: I am pleased to advise on the fruitful interactions with the US Department of the Treasury which stands ready to facilitate access to acquisition of smaller denominated coins and replacement of soiled notes through the US Federal Reserve and commercial banks. I will, therefore, be finalising on this in conjunction with the banking system, that way resolving the matter of challenges with change and coins.
The availability of both US dollar and rand coins will do away with the challenges posed by the current need to apply cross rates in giving change in rand coins for transactions undertaken in US dollars, Biti said. Whilst this problem should be alleviated by electronic payment systems, the large size of the informal sector and the lack of infrastructure for electronic payment systems in rural areas necessitate the availability of large volumes of small denominations.
They need to lose Mugabe before any other action.
“Its pretty scary when reality seems like outrageous satire.”
I’ve had that feeling for years and years, when I look back I try to imagine someone fifty years ago writing a novel about an America as mixed up as it is now and I just don’t think anyone could have written fiction equal to the current reality. It is as bizarre as Alice in Wonderland but far more negative and depressing.
Ever hear of Ayn Rand? She was surprisingly prescient. (Having come from Soviet Europe probably helped.)
What happens to the Zim gold-back currency when Mugabe finally runs off with the Zim gold reserves?
Sounds to me like they're trying to mend their ways aftter hitting rock bottom. People eventually learn.
I read Atlas shrugged almost fifty years ago but certain aspects of life today seem to be beyond anything Rand wrote about. Maybe I just need to reread it.