Aug 30, 2011
What does extreme hyperinflation look like? Consider a pile of currency tall enough to encircle our entire galaxy. That’s how many Zimbabwean dollars you would have needed by the end of the country’s extraordinary inflationary crisis to equal one pre-crisis Zim dollar, according to CGD senior fellow Alan Gelb. Newly returned from a holiday in Zimbabwe with his wife, who was born in Zimbabwe, Alan shared his observations and reflections on the country’s fate in a blog post that provided the starting point for our Wonkcast chat.
“Zimbabwe had the second highest hyper-inflation registered in history,” says Allan. “At the peak of the crisis, prices were increasing many times every day or every hour.” Eventually the government stopped issuing Zimbabwe dollars and legalized several other currencies, including the U.S. dollar, which now circulates freely—though often in a very tattered form. Shops in affluent parts of Harare, the capital, are well stocked, though prices are high, even by U.S. standards, he says. “You really wonder how people are able to make ends meet at all,” he adds.
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