Tag Archives: tipping

Zimbabwe Reaches ‘Tipping Point’ as Inflation Blacked Out

Zimbabwe Reaches ‘Tipping Point’ as Inflation Blacked Out(Bloomberg) — Zimbabwe’s finance minister responded to the country’s worsening economic crisis last week by blacking out inflation statistics for the next six months, boosting the price of the little power that’s available five-fold and admitting what the International Monetary Fund told him in April: the economy will contract for the first time since 2008.At the same time he spoke of fiscal surpluses and a relaxation in local ownership requirements for the key platinum industry. This all happened in a country with daily power cuts of up to 18 hours and shortages of everything from bread to motor fuel. People are receiving food aid in cities for the first time and a drought has necessitated the import of hundreds of thousands of tons of corn.When Robert Mugabe was ousted after four decades in power in late 2017 his replacement, Emmerson Mnangagwa, promised economic regeneration and declared that Zimbabwe is “open for business.” Instead things have gone from bad to worse with the effects of rapidly expanding money supply through the sale of Treasury bills under Mugabe’s rule coming home to roost and this year’s outlawing of the U.S. dollar in favor of a local quasi currency that can’t be traded outside the country causing panic.“Zimbabwe is at a tipping point and if it falls over the edge it’s going to be quite a long way in coming back,” said Derek Matyszak, a Zimbabwe-based research consultant for South Africa’s Institute for Security Studies. “The wheels are falling off. There is no way out of a Ponzi scheme other than a massive infusion of cash to pay off your creditors.”The country with the world’s highest inflation rate after Venezuela also suspended annual consumer-price data for the next six months. The authorities need to collect comparable data since the introduction of the new currency in February. That marked a return to 2009, when the country abandoned the Zimbabwe dollar in favor of the U.S. dollar and other currencies after inflation surged to an estimated 500 billion percent.If the more commonly used black-market exchange rate is used, Zimbabwe’s annual inflation is currently 558%, about three times the official rate, while Venezuela’s is 35,004%, according to Steve H. Hanke, a professor of applied economics at the Johns Hopkins University in Baltimore.Scrapping the official annual rate is “no real loss from an analytical perspective,” said Jee-A van der Linde, an economist at NKC African Economics in Paarl, South Africa. “These elevated inflation readings did little more than create panic and damage what little confidence was left.”Still, the decision evokes other countries in crisis. Venezuela halted publication of inflation data and while it periodically releases figures, it isn’t operating on a regular schedule. In 2013, Argentina was censured by the IMF for tampering with its data.A de-linking of the country’s quasi-currencies from parity with the U.S. dollar in February and the re-imposition of the Zimbabwe dollar overnight in June has fueled depreciation with the currency officially trading at 9.28 to the dollar on Aug. 2. The black-market rate was 10.8, according to Marketwatch.co.zw, a website run by analysts. While the government has argued that in the face of foreign-currency shortages it has no choice but to reintroduce its own currency, Hanke disagrees.“The Achilles heel is the introduction of the new currency to the exclusion of the dollar,” he said. “They have decided to go in the completely opposite direction and claimed it’s the best thing since sliced bread and it’s going to be an absolute disaster.”While the cost of basic services has climbed 400% this year, pay rises have been around 10%, said Japhet Moyo, secretary-general of the Zimbabwe Congress of Trade Unions, which has 130,000 members.Finance Minister Mthuli Ncube tried to highlight the country’s first positive current-account balance in a decade as a sign of progress. Since his appointment last year, the government has sold only marginal amounts of Treasury bills. And earlier this year, the Cambridge University-trained economics professor forecast that month-on-month inflation, which surged to 39.3% in June, would be close to zero by year-end.The fundamental problem is that the government has failed to attract significant investment and hasn’t substantially changed the policies of the Mugabe era, said John Robertson, an independent economist in Harare, the capital.“People are very angry” and even though a quarter of the population has already emigrated, more may follow, said Matyszak.“The Zimbabwe I once loved has become a cemetery for my son’s future” said Ashley Randen, an unemployed single mother of a 12-year-old boy in Harare.\–With assistance from Daniel Cancel and Carolina Millan.To contact the reporters on this story: Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net;Prinesha Naidoo in Johannesburg at pnaidoo7@bloomberg.net;Ray Ndlovu in Johannesburg at rndlovu1@bloomberg.netTo contact the editors responsible for this story: Rene Vollgraaff at rvollgraaff@bloomberg.net, Antony SguazzinFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.



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Fox News hires former DNC chair Donna Brazile who left CNN after tipping off Clinton about 2016 debate questions

Fox News hires former DNC chair Donna Brazile who left CNN after tipping off Clinton about 2016 debate questionsFox News’ newest pundit is one CNN rejected after she colluded with Hillary Clinton’s campaign before campaign events in 2016. Fox said on Monday that it has hired Donna Brazile, the former interim Democratic National Committee chair and a long-time CNN commentator before she became embroiled in controversy in 2016. CNN forced Ms Brazile to resign as an on-air contributor in October 2016 after emails revealed that she had tipped off Ms Clinton’s aides about questions likely to be asked by CNN moderators during the debates and town hall meetings carried by CNN.



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The Dos and Don'ts Of Holiday Tipping, According To An Etiquette Expert

The Dos and Don'ts Of Holiday Tipping, According To An Etiquette Expert'Tis the season for giving. But how much? And to whom?



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Liz Weston: 5 guidelines for holiday tipping

Liz Weston: 5 guidelines for holiday tippingHoliday tips are a way to thank the people who make your life easier. So why is it so hard to figure out whom to tip and how much?



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Liz Weston: 5 guidelines for holiday tipping

Liz Weston: 5 guidelines for holiday tippingHoliday tips are a way to thank the people who make your life easier. So why is it so hard to figure out whom to tip and how much?



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Are we at a tipping point on guns?

Are we at a tipping point on guns?Aroused activists helped end slavery and Jim Crow, and they're bringing about big changes in how men treat women at work. Can they do something about school shootings?



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Tips on Tipping This Holiday Season

Tips on Tipping This Holiday SeasonWho should you tip and how much should you give during the holidays? Those are questions consumers grapple with every year, and there’s no clear-cut answer. But there are guidelines, depending on…



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Is healthcare vote the tipping point for liberals regaining control of the House?

Is healthcare vote the tipping point for liberals regaining control of the House?As House Republicans reached the vote count needed to pass an unpopular rewrite of a new healthcare law, Democrats chanted derisively. “Na na na na, na na na na,” they sang, confident Republicans would soon regret their support for the bill. Seven years before that, Democrats on the other side of the aisle had cast contentious votes for a healthcare bill with steep political consequences.



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AIDS campaigners say pandemic has finally reached tipping point

People walk near a red ribbon sand sculpture created by Indian sand artist Patnaik on the eve of World AIDS Day in OdishaBy Kate Kelland LONDON (Reuters) – The world has finally reached "the beginning of the end" of the AIDS pandemic that has infected and killed millions in the past 30 years, according to a leading campaign group fighting HIV. The number of people newly infected with HIV over the last year was lower than the number of HIV-positive people who joined those getting access to the medicines they need to take for life to keep AIDS at bay. But in a report to mark World AIDS Day on Dec. …



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AIDS campaigners say pandemic has finally reached tipping point

Beach goers look at a red ribbon sand sculpture created by Indian sand artist Sudarshan Patnaik to create awareness about AIDS on the eve of World AIDS Day on a beach in PuriBy Kate Kelland LONDON (Reuters) – The world has finally reached "the beginning of the end" of the AIDS pandemic that has infected and killed millions in the past 30 years, according to a leading campaign group fighting HIV. The number of people newly infected with HIV over the last year was lower than the number of HIV-positive people who joined those getting access to the medicines they need to take for life to keep AIDS at bay. But in a report to mark World AIDS Day on Dec. …



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