Because it was getting ridiculous - a McDonald's lunch for two costing more than a million, and the federal budget up in the quadrillions - and because all those zeros were becoming too much for common calculators, Brazil's government made a symbolically poignant but virtually cosmetic devaluation last week.
It knocked three zeros off its currency on Aug. 1, turning the cruzeiro into the cruzeiro real - the "real cruzeiro."It was the fifth currency change since 1980. A total of 12 zeros have been cut in a period when compounded inflation has increased, according to the newsmagazine Isto E, by more than 87 billion percent.
"Brazil beats all the records when it comes to economic chaos," was the article's bitter boast.
President Itamar Franco had delayed for several months making the currency change that was sure to call attention to his government's failure to stem the nation's increasingly alarming inflation.
And sure enough, it has.
"It was an admission of defeat," former Central Bank President Francisco Gros said Thursday. "When you just cut zeros, you're really just making life easier for people. You're not making the hard decisions. And that's why we've got such high inflation. It's so easy." With prices now rising 1 percent a day, Fernando Henrique Cardoso, appointed in May as Franco's fourth finance minister in five months, has reached the end of a short honeymoon. On Wednesday night, he felt obliged to appear on national TV to deny a rash of rumors that he, too, would be quitting.
Cardoso also vowed, as he has done several times before, that the government would not resort to a "shock," such as a price freeze. At a meeting of business executives Wednesday, he said he wouldn't "stab society in the back," and that the only shock he would support would be the "shocking truth."
In fact, also on Wednesday, the finance minister said that he would soon be announcing new, "strict measures" to combat inflation, in addition to his cautious plan to date of seeking budget cuts and cracking down on tax evaders.
Aides have told reporters that the measures would include accelerating Brazil's privatization program. This could bring Cardoso into conflict with Franco, who has agreed to sell-offs of state businesses only with great reluctance.
Such considerations, plus suggestions last week that the inflation rate may be accelerating, fed the tremendous skepticism that met the money switch. "The month began with real cruzeiros and real price increases of 100 percent," griped Jo Soares, Brazil's Jay Leno, on his late-night talk show Monday. "They cut off the zeros, and the zeros are already starting to appear again. It's a plague . . . it doesn't help to cut them off, because they stay there just waiting in the supermarket machines . . . crazy to come back."
Central Bank spokesman Manuel Montenegro said Brazilians won't see any truly new currency notes until October, as they are still being printed. Until that time, the old notes will stay in circulation, stamped with new denominations.
The new 5,000 cruzeiro real note - which would have been a 5 million cruzeiro note, without Aug. 1's change - will feature a picture of a gaucho, or pampas dweller, Montenegro said, starting a series of bills that will show regional figures instead of historical figures.
Montenegro denied reports that the switch was necessary because the country had run out of great names.
"We still have a few," he insisted. Yet he did confirm that the family of one dead hero, the novelist Guimaraes Rosa, recently refused to permit his likeness to be printed on the ephemeral currency.