HARARE, Zimbabwe (CNN) -- Zimbabwe slashed 12 zeros from its currency as hyperinflation continued to erode its value, the country's central bank announced Monday. "Even in the face of current economic and political challenges confronting the economy, the Zimbabwe dollar ought to and must remain the nation's currency, so as to safeguard our national identity and sovereignty. ... Our national currency is a fundamental economic pillar of our sovereignty," said Gideon Gono, governor of the Reserve Bank of Zimbabwe. "Accordingly, therefore, this monetary policy statement unveils yet another necessary program of revaluing our local currency, through the removal of 12 zeros with immediate effect." The move means that 1 trillion in Zimbabwe dollars now will be equivalent to one Zimbabwe dollar.
You ask, "why do you keep telling me about these irrelevant countries halfway across the world?". Yes, there's a reason. It can happen here in the mighty U.S. of A. Zimbabwe appears to be the most recent example of massive hyperinflation. Most of what I read and believe says that we're in for a major deflationary depression or major inflationary depression. Understanding the front runners might provide some clues and assist with preparation. The deflationary depression results in major declines in everything. This one looks like it's in progress, but the missing piece is that credit continues to expand and at record rates. A deflationary depression should be accompanied by credit contraction. The continued credit expansion and money printing should lead to an inflationary depression where costs skyrocket (Zimbabwe). Neither is good, but they present very different outcomes.
Secondly to the question, as I mentioned in a recent post, these events and microcosms by their fractal nature, can provide clues to the future on a range of scales.
Sierpinski's Triangle
If you understand the shape and form of one of the triangles, then you understand the structure on all scales.
This historic unfolding event can be examined and observed on many scales: individuals, cities, counties, states, regions, countries, and continents. The weakest stumble first. Some examples:
-Individual: do you know anyone that just lost their job? I know of two friends in the past 3 weeks.
-City: New York - It was announced that NYC faces a $4 billion deficit with 23,000 jobs to be cut. Four cities in CA and six others are expected to declare bankruptcy this year.
-County: Jefferson County, AL continues to teeter on the verge of bankruptcy.
This historic unfolding event can be examined and observed on many scales: individuals, cities, counties, states, regions, countries, and continents. The weakest stumble first. Some examples:-Individual: do you know anyone that just lost their job? I know of two friends in the past 3 weeks.
-City: New York - It was announced that NYC faces a $4 billion deficit with 23,000 jobs to be cut. Four cities in CA and six others are expected to declare bankruptcy this year.
-County: Jefferson County, AL continues to teeter on the verge of bankruptcy.
-State: California - The deficit is heading towards $40 billion. Moody's has warned of a possible downgrade....the kiss of death in the credit world.
-Region: The "auto belt" in the U.S. will be one to watch.
-Country: See my prior post on Iceland. Keep your eye on Mexico. The drug lords appear to be winning.
-Continent: Africa's struggles will rise to a new level in the coming years. S. America might be the 2nd weakest.
-Region: The "auto belt" in the U.S. will be one to watch.
-Country: See my prior post on Iceland. Keep your eye on Mexico. The drug lords appear to be winning.
-Continent: Africa's struggles will rise to a new level in the coming years. S. America might be the 2nd weakest.
Keep your eyes and ears open. What might appear irrelevant could be very educational.
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