Reserves from thin air
Through the discount or 'reverse repo' window, or buying up government debt, a central bank creates non-existent 'savings' in commercial banks, triggering an imbalance between savings and credit demand, which leads to a 'bubble' and eventual economic collapse.
The International Monetary Fund (IMF) said Thursday the government has matched expenditure to revenue from January to May 2009, and foreign inflows are also helping drive economic activity.
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"As a result of improvements in macroeconomic policies, a nascent economic recovery appears to be underway," Vitaliy Kramarenko, IMF mission chief to Zimbabwe said in a statement.
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"A more liberal economic environment, price stability, a deepening in financial interme