Economic Chaos Continues in Zimbabwe

After finding that their currency is in shambles, Zimbabwe's Mugabe decided to reauthorize the use of old coinage that was worthless back in 2002 when Mugabe's economic policies began a death spiral of hyperinflation.

In the past week, Zimbabwe's inflation is officially at 2.2 million percent, while economists think that it's far closer to 12.5 million percent.

Zimbabwean currency is virtually worthless, which is why they're forced to go back to old coins.

"It has been a chaotic day," said Farayi Chikomba, a teller filling plastic banking bags with coins at a small supermarket at closing time. "Customers have been digging out their old coins."

Lines built up as staff counted the coins.

"It's a bonus for anyone like me who didn't know what to do with coins and didn't throw them away," said businessman Frank Takavara, who carried a cookie jar full that bought him a small sachet of powdered milk.

Chikomba said he received a few new $10 and $20 notes issued by banks Friday. But most purchasers still used coins, old notes or checks. The old currency remains effective until December, being used alongside new bills in the "revalued" currency rate introduced Friday.

The biggest new bill is $500, equivalent to 5 trillion in the old denominations. Two weeks ago, the bank had introduced a $100 billion-dollar note.

Bank executives said many branches still were waiting for deliveries of new currency from the central bank late Friday, the first day of issue.

In setting prices on its menu, a downtown cafe mistakenly slashed nine zeros from its prices instead of the required 10. Until December, prices must be quoted in both new dollars and old dollars, according to a central bank directive.

"Everyone is totally confused. Maybe things will settle down in a few days. It's farcical at the moment," said the cafe manager, who asked not to be identified for fear of repercussions.

The confusion will continue as there's absolutely no sign that the hyperinflation will cease. After all, Mugabe's economic policies remain in place and the only thing the government keeps doing is introducing new currency at ever higher denominations.

Mugabe continues to blame sanctions and profiteers for the mess, but he only has to look into the mirror to see the ultimate cause. He stole elections from the Zimbabwean people, and the sanctions are a direct response to that. People are trying to survive in a hostile economic situation, and Mugabe considers that criminal.