Yves Smith reprises the below gem from the Reserve Bank of Zimbabwe’s quarterly monetary policy statement. One for the “couldn’t make it up” file.
Here in Zimbabwe we had our near-bank failures a few years ago and we responded by providing the affected Banks with the Troubled Bank Fund (TBF) for which we were heavily criticized even by some multi-lateral institutions who today are silent when the Central Banks of UK and USA are going the same way and doing the same thing under very similar circumstances thereby continuing the unfortunate hypocrisy that what’s good for goose is not good for the gander….
As Monetary Authorities, we commend those of our peers, the world over, who have now seen the light on the need for the adoption of flexible and practical interventions and support to key sectors of the economy when faced with unusual circumstances.
The situation in Zimbabwe has rather worsened since the report was issued some months ago. But reading the latest bulletin of emergency “additional monetary policy measures to stabilise the banking system”, would you know we were talking about a failed African dictatorship?
Persistent queues at most banking institutions call for urgent intervention in order to restore confidence in the banking sector and creditability of the national payment systems.
All banking institutions are now required to keep their minimum capital requirements in foreign currency as tabulated…
Every banking institution shall be required to demonstrate, at the request of the Reserve Bank, the adequacy of their foreign currency denominated capital bases on an on-going basis.
There’s also an initiative called the KYC - know your customer - which is designed to improve due diligence lending standards at the banks.
The sycophants at the Reserve Bank of Zimbabwe will likely get plenty more mileage out of comparing their own plight to that facing the rest of the world. Not that it isn’t amusing - and rather embarrassing for Merv and Ben - all the same.
There are, of course, a few differences. Ones of scale, for example:
Between the 10th and the 20th of November, 2008, total fraudulent cheques we intercepted in the clearing system had risen to $60 hexillion ($60,000,000,000,000,000,000,000).
The main output of the RBZ seems to be inventing statistics with which to exculpate itself from blame for the economic and humanitarian disaster over which it has presided. Thankfully we’re not quite at that point yet with the Fed and BoE, though some of you might disagree…
Related links
Zimbabweisation, USA - FT Alphaville
The mad market of Zim - FT Alphaville
