And then there's Zimbabwe

There is little good news for the U.S. dollar today, but that doesn't mean there isn't any good news. There is at least one currency in the world that the U.S. dollar is strengthening against - the Zimbabwe dollar.

While the official exchange rate is a mere 30,000-to-1, the black market rate has risen as high as 1,000,000-to-1, as the African nation struggles with an 8,000 percent annual rate of inflation and a plethora of other economic ills.

Amazingly, they have a functioning central bank, whose primary job lately appears to be to buy up as much hard currency as it can, making all remaining hard currency even more valuable when exchanged for the local currency in shady back rooms or, as it turns out, at bus terminals.


This report in the International Herald Tribune explains:

"There's too little foreign exchange out there and too many chasing it," including the central bank, said the dealer, who spoke on condition of anonymity for fear of being punished by the government.

Those with foreign exchange "don't want to part with it as a hedge against inflation," the dealer said.

Lengthy power and water outages linked to shortages of hard currency, spare parts and gasoline occur daily.

Travelers returning home to Harare from shopping trips for soap, cooking and other basics across the country's borders have reported central bank buyers at the downtown bus terminal offering top black market rates for leftover U.S., Botswana and South African currencies needed to pay for food, power and gasoline imports.

Police raids on currency dealers at the terminal have stopped.

Central bank governor Gideon Gono said in a policy speech this month that his bank saw the terminal as a source of hard currency and that the official exchange rate was all but obsolete.

By comparsion, Ben Bernanke's job is a piece of cake.