For some, defunct Zimbabwean trillion-dollar notes reap huge gains

Single Zimbabwean 100 trillion-dollar bills are fetching up to $57 on auction site Ebay(Shutterstock)

Sales of Zimbabwean 100 trillion-dollar notes – now long defunct as real currency – have been fetching some speculators returns of 1,500 percent.

Back in 2009, as massive hyperinflation in the impoverished African country hit a peak, one of the massive notes would have barely bought a bus fare.

But now, single 100 trillion-dollar bills are fetching up to $57 on auction site Ebay, the UK-based Guardian reported on Saturday.

Zimbabwe has since abandoned its currency altogether for the US dollar, South African rand and several other foreign currencies.

However, the notes live on as souvenirs of a time gone by – and a lucrative investment.

John Wolstencroft, a UK-based private investor interviewed by the Guardian, originally bought the novelty notes as gifts before realizing they would soon become a collector’s item.

The notes soon became popular with financial advisors hoping to persuade clients that cash, as with all things, does not hold its value forever.

Serious business

Some take the trade in defunct currencies very seriously. A US-based money wholesaler sensing an opportunity told the Wall Street Journal in 2011 that he had spent $150,000 buying up Zimbabwean bills.

“I've made more people trillionaires [than legendary US investor Warren Buffet],” Frank Templeton, a retired Wall Street equities trader, told the paper.

Dealers believe that the regime of Zimbabwe’s longtime President Robert Mugabe printed roughly five to seven million 100-trillion-dollar notes.

In contrast to the 1,500 percent returns enjoyed by some speculators, London’s stock exchange has increased by only 5 percent in the same period. The Dow Jones in New York meanwhile, has gained less than 7 percent in the same timeframe.

Out-of-circulation banknotes are not the only unconventional assets a budding investor might consider.

Lego sets kept in mint condition have increased in value 12 per cent each year since the year 2000, the London-based Telegraph reported in December.

Last Update: Wednesday, 20 May 2020 KSA 12:04 - GMT 09:04