HUGO & MUGO
Posted on 09/03/2007 9:38:07 AM PDT by NRG1973
CARACAS: The Venezuelan economy, under the direction of President Hugo Chávez, is starting to unravel in the currency market.
While Venezuela earns record proceeds from oil exports, consumers face shortages of meat, flour and cooking oil. Annual inflation has risen to 16 percent, the highest in Latin America, as Chávez tripled government spending in four years.
Exxon Mobil and ConocoPhillips are pulling out after Chávez demanded that they cede control of joint venture projects.
The bolivar has tumbled 30 percent this year to 4,850 per dollar on the black market, the only place it trades freely because of government controls on foreign exchange. That compares with the official rate of 2,150 per dollar set in 2005. Chávez may have to devalue the bolivar to reduce the gap and increase oil proceeds, which make up half the government's revenue.
"This has been the worst-managed oil boom in Venezuela's history," said Ricardo Hausmann, a former government planning minister who now teaches economics at Harvard University. "A devaluation is a foregone conclusion. The only question is when."
JPMorgan Chase and Merrill Lynch expect Chávez to devalue the bolivar 14 percent in the first quarter of 2008 after he introduces a new currency Jan. 1 that will lop three zeros off all denominations.
(Excerpt) Read more at iht.com ...
Hugh Chavez = Robert Mugabe del Sur.
Isn’t this what ALWAYS happens when the communist institutes their economy? HA HA HA Capitalism works-—communism sucks...
Let’s hope it tanks. Heaven help this administration if they bail out Venezuela.
I love it when a good story just writes itself.
heading into the toilet like Iran’s economy
A devaluation would give the government more bolivars from its oil export tax receipts, helping fund Chávez's policies to provide free health care, housing and discounted food to millions of Venezuelans.
Hey, it could work!
When does the killing of the opposition begin?
.
It is really ironic when the black market is thriving for US Dollars -- Chavez's hated enemy... Pay back is a bitch!
And the people who voted in Chavez are getting the brunt of this. They can't take their money out of Venezuela -- and they can't afford black market prices.
This new Venezuelian currency is now called the "Strong Bolivar." When Chavez cannot control inflation and must devalue the currency more - what is he going to call it? The super duper strong Bolivar? Is this guy on crack? Does he seriously believe people are that stupid? No, wait -- yeah he does...
Hey, it could work!
Damn! If we had kept Jimmy Carter for a second term, we'd all be multi-millionaires today!
The year before the Shah left Iran, 70 rial = $1.00.
Now, it is about 9,400 rial = $1.00.
And there are food shortages.
The wonders of planned economy.
Yep! Our bank accounts would be humongous. And so would our wallets, to carry around all that cash to buy a loaf of bread with.
A devaluation would give the government more bolivars from its oil export tax receipts, helping fund Chávez’s policies to provide free health care, housing and discounted food to millions of Venezuelans.
It doesn’t matter how much funny money is available when there is no food to be bought. Tinhorn dictators never learn.
Great—— This means Hugo Chavez has to sell more oil to meet expenses. Oil gets cheaper on the world market
You watch. This loathsome little Castro wanna-be will start a war to divert attention from the socialist wrecking ball he’s taken to the Venezuelan economy.
“When does the killing of the opposition begin/”
Before the war he’s going to start to cover his little economic oopsie.
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