To face his country’s disastrous economic situation and the scarcity of Describes the extent to which assets or rights can be converted into cash without causing a significant decrease in the asset’s price. Accordingly, liquidity is often inversely proportional to the profitability of the asset and involves the trade-off between the selling price and the time needed to convert it to cash. In finance, cash is considered the most liquid asset and cash is sometimes used as a synonym for liquidity (e.g. cash reserves; cash pooling…). More, President Robert Mugabe of Zimbabwe is testing a new solution: government-issued bond notes that are worth 1-to-1 with the US Monetary unit of the United States of America, and a number of other countries e.g. Australia, Canada and New Zealand. More. This desperate move was taken to try and salvage the economy after the abandonment of the Zimbabwean dollar and the subsequent growing scarcity of the US dollar, adopted as an alternative currency in 2009. The fear of another economic meltdown has pushed many Zimbabweans to hoard the little remaining greenbacks, leaving the poor and the unbanked without any alternatives.
Although the move is designed to settle Zimbabwe’s chronic shortages of Money in physical form such as banknotes and coins. More, there are fears that the bond notes will only aggravate the situation and cause yet another hyperinflation in an already struggling economy.
These fears have led many to protest in the streets, leading to violent repercussions from the authorities and numerous arrests.
Mugabe, now 92 and in power since almost 3 decades, will be running for reelection in 2018.
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