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Zimbabwe announces return to the gold standard
Posted: Fri Apr 05, 2024 8:56 am
by pmbug
Zimbabwe has announced they will be replacing their existing fiat currency (ZW) with a gold standard currency (ZiG) backed by a basket of gold and USD:
https://www.pmbug.com/threads/zimbabwe- ... post-98582
Re: Zimbabwe announces return to the gold standard
Posted: Fri Apr 05, 2024 9:42 am
by xmj
Re: Zimbabwe announces return to the gold standard
Posted: Sat Apr 06, 2024 3:20 pm
by I Shrugged
Is it redeemable for USD and gold, or what?
Re: Zimbabwe announces return to the gold standard
Posted: Sun Apr 07, 2024 12:08 am
by ArthurPooh
I Shrugged wrote: ↑Sat Apr 06, 2024 3:20 pm
Is it redeemable for USD and gold, or what?
Apparently it's not redeemable for gold. It's supposedly "backed" by USD and gold. I think after the Zim dollar failed there have been two supposedly USD-pegged currency systems already and they did not stay pegged for too long. This seems like just another attempt to do the same.
Ask yourself: would you really trust a gold certificate issued by
Zimbabwe? If they really wanted to make their financial system trustworthy, they would just officially introduce a foreign hard currency. Only reason to try and revive a local currency at this point is to enable more printing.
Re: Zimbabwe announces return to the gold standard
Posted: Sun Apr 07, 2024 9:08 am
by pmbug
ArthurPooh wrote: ↑Sun Apr 07, 2024 12:08 am...
Apparently it's not redeemable for gold. ...
Where did you see this reported? The RBZ says (bold is mine):
...
149. The Reserve Bank is introducing a structured currency which is generally defined as a currency that is pegged to a specific exchange rate or currency basket and backed by a bundle of foreign exchange assets (potentially including gold). This means that a Central Bank can only issue domestic notes and coins when fully backed by a foreign “reserve” currency or foreign exchange assets and that the currency is fully convertible into the reserve currency on demand.
150. The structured currency being introduced is anchored by a composite basket of foreign currency and precious metals (mainly gold) held as reserves for this purpose by the Reserve Bank.
...
https://www.rbz.co.zw/documents/mps/202 ... tement.pdf
It remains to be seen what they actually do of course, but they are claiming that the new ZiG will be redeemable for underlying asset(s). It's not clear however, if they are just going to give redemptions in USD (or other basket paper) or actually hand over some gold.
Re: Zimbabwe announces return to the gold standard
Posted: Sun Apr 07, 2024 1:09 pm
by dualstow
So any MC Hammer giphy here would be premature