Two Hyperinflations In Less Than Ten Years Did Mugabe In

Steve H. Hanke's picture

Authored by Steve H. Hanke of the Johns Hopkins University. Follow him on Twitter @Steve_Hanke.

Robert Mugabe’s 37-year reign of lawlessness, corruption and incompetence has just come to an end.  Mugabe is toast, thanks to a “soft coup” engineered by Emmerson Mnangagwa (aka: “the Crocodile”), who was Zimbabwe’s Vice President until he was dismissed earlier this month by Mugabe. Now, with the support of the military, the Crocodile will probably serve as Interim President until elections are held. What really did Mugabe in?  Two episodes of hyperinflation in less than 10 years did the job. 

The first episode occurred during the 2007-08 period. It was then that Zimbabwe suffered the second most severe episode of hyperinflation in recorded history. As shown in the table below, the annual inflation rate peaked in November 2008 at 89,700,000,000,000,000,000,000%

This year, Zimbabwe once again experienced a bout of hyperinflation. This second episode began on September 14, 2017. At present (11/15/17), the annual inflation rate is 323%, as shown in the chart below.

Zimbabwe’s hyperinflation episodes finally produced enough outrage to enable the Crocodile to outsmart Mugabe. 

Next stop, Venezuela? Will inflation prove to be the catalyst that unseats Maduro?

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
dlweld's picture

Rhodesia (now Zimbabwe) in Africa was doing just fine (rich, prosperous, breadbasket of Africa) with the white race doing the planning and administration that it seems to do so well - but, nope, can't have that race doing that, so the West forced out Ian Smith as leader and replaced the Zimbabwean white race, that was in charge of the planning, adminstration and government, with blacks. Now Zimbabwe is a starving basket case. I suspect any of the formerly well fed, now famine ridden Zimbabweans, of any race, would love to have competent, honest (white) government again.

any_mouse's picture

Maybe they should invite the Rhodesians back.

Sir Bit-a-Lot's picture

What caused that hyperinflation? Did he print all of that fine money himself? You never hear about the reasons.

Arrest Hillary's picture

The new President of Zimbabwe: "I hope he fails !" (All my hate is for Socialism, "Liberals" and Islam .... the blacks get a pass !) 

Dumpster Elite's picture

Remember when Zimbabwe was Rhodesia...back when the evil white man was running things. We can't have that now, can we. ooooooooo....evil whitey.

Dan'l's picture

Rhodesia was the breadbasket of Africa until evil commies in Sweden and Europe forced the ethnic cleansing of Whites there. 

optimator's picture

One Man, One Vote it was -- One man, one vote, one time.

Red Fred's picture

Old age and a scheming ambitious wife, who has his ear, are threatening to do the 93 year old Mugabe in. The hero of Africa has not gone yet. Inflation be damned.  

otschelnik's picture

Zimbabwe is also the poster child for land redistribution, a policy which has failed in every country its ever been applied in. In the USSR it was applied against the 'kulaks,'  in Zimbabwe it was applied to against the whites. 

Cloud9.5's picture

John Locke had it right.  The right to life, liberty and property is the corner stone of a functioning society.  In a true market business failures are a part of the natural cycle.  When entities become powerful enough to suspend the business cycle then the economy goes off the rails.  We are where we are because the convergence of money and politics has suspended the business cycle.  We now have institutions rather than businesses and those institutions have become too politically powerful to fail.

In the past, a failed business provided the bones to build a new start up.  Now zombie businesses with political connections never die.  They become energy sinks bleeding more and more energy out of the system.  Tainter talked about this process in his Collapse of Complex Societies.  The oligarchs are picking winners and losers.  In the process they are destroying property rights.   The middle class was destroyed on the altar of globalization.  The elites offshored our technology and our production.  The working class became the dependent class.

History proves without a doubt that a reset is inevitable.  For a brief period during the reset we will experience the highest level of freedom.  What will follow will be a much more decentralized system.  With that decentralization will come a reduction in population.  Labor will once again become valuable and property rights will once again be established.




MoreFreedom's picture

I agree.  It's also important that government not be meddling in the free markets,  but the greed  motive for doing so is very strong, on both the part of politicians in that it generates campaign cash by rich business owners looking for government favors, and for business owners that want governemnt to make them rich rather than earning it in a free market. 

But what politicians continally tell us, is that "we need reasonable regulation."   The only "reasonable regulation" is the free market, with disputes in business sorted out in courts via the common law, rather than politicians and bureaucrats continually chaning the rules via administrative law.

Village-idiot's picture

And, the sooner, the better!

DEMIZEN's picture

i salute the invisible hand. we would buy the land from the natives, but geronimo killed the notary. not my fault.

LawsofPhysics's picture

Please stop overthinking this.  This has everything to do with the power and control gained through the control of money, period.

Absolute power and control corrupts absolutely.

It is not sustainable, period.

As you suggest, this is in fact a combination of Easter Island and the Weimar Republic, but on a global scale.

Cloud9.5's picture

I think we are two blind men trying to grasp, pun intended, the elephant in the room.  Every organization attempts to grow.  It matters not whether that organization is a business, the state or the church.  In the natural process, one generation earns it. The next generation spurns it and the last generation burns it.  Now we have corporate entities that never die.  They become monopolies in their spheres of influence.   They either buy up or burn down their competition.  Then hubris, complacency and egotism rule.  What follows after that is collapse.

DisorderlyConduct's picture

Sooner rather than later would be a plus.

Elmerthudpucker's picture

You mean like the US land distribution program that started Amercia ?  Or the one the banking cartel is now perpetrating ?

cheech_wizard's picture

#Itsokaytobewhite #blacknotsomuch

silverer's picture

Will inflation prove to be the catalyst that unseats Maduro?

If not being able to afford your designer sneakers doesn't do it, perhaps a lack of affording food to stay alive will.

JoeTurner's picture

Zimbabwe are pishers compared to the FED !

Dave5150's picture

For 30 years, the Fed has taken what Zimbabwe did and then one-trillion-upped them.

silverer's picture

That final number I think is vigintillion. It sets a goal for the Fed, eh?

Village-idiot's picture

Finally, we have a true goal to aim for.

We're number one!

We're number one!