God gave us a spirit of sound mind...

Zimbabwean Economy is becoming more volatile in which an economic shock is going to be experienced before long whilst people are soothing thinking that the economy is heading towards a boom. Deflation has got its own consequences which may follow the road map of inflation. Low profits to be obtained by firms due to little sales per given period. As the companies would want to cut their operating costs it will see firms retrenching which will have a bearing on household's disposable income. Rational expectations need to be considered before the economy gets to the worst because this deflation heating Zimbabwe will cause firms to shut down operations in the long run leading to cyclical economic traumas. Though we have got little to do on the monetary policy side so as to direct the economy from a deflationary groove, relaxing some investment regulations on foreign investors is a better good way. This is because once we have industries running properly in our country that would increase production which will require more labour to be employed hence we will have more disposable income to play around with. Once we have more disposable income, prices will be forced to go high according to the laws of demand and supply. Holding all other things constant, the deflationary grove will be offset. Investment is really difficult to embark on in a deflationary economy which means that companies should employ better means of getting the best out of this situ rather than continuing to use those old strategies. This might seem to be a challenge to socialists since liberalising the economy a bit is a night mare to them. The introduction of many currencies will never solve deflation as long as the is no production and taking one of the characteristics/definitions of money as something acceptable in trade, the rupees and yens are just a matter of trying to confuse economic players as this will be complex. Simple and straight forward way of reviving the economy to relax those investment regulations in foreign investors until up to a point where the Zimbabwean economy is alive which is most likely to take 7-10 years. Bible quote Matthew 9:16 - You can't put old wine into old wineskins. Common sense is not always common but there is a need here which needs to be acted on before its doom. Companies you need to embrace new techniques for you continued existence in the coming age. Zimbabwean deflationary indicators From my findings about the current economic situation in Zimbabwe, the obvious and un ambiguity indicators are: 1. PRICE FALLS. 2. Bankruptcy in many companies 3. Diminishing company activities 4. High operating cost vs less turnover 5. Liquidity crunch
jtchibanda@gmail.com May God bless Zimbabwe and those therein...