Posted on 02/08/2013 3:44:09 PM PST by Orange1998
While the rest of the developed world is scrambling here and there, politely prodding its central bankers to destroy their relative currencies, all the while naming said devaluation assorted names, "quantitative easing" being the most popular, here comes Venezuela and shows the banana republics of the developed world what lobbing a nuclear bomb into a currency war knife fight looks like:
VENEZUELA DEVALUES FROM 4.30 TO 6.30 BOLIVARS VENEZUELA NEW CURRENCY BODY TO MANAGE DOLLAR INFLOWS CARACAS CONSUMER PRICES ROSE 3.3% IN JAN.
And that, ladies and gents of Caracas, is how you just lost 46% of your purchasing power, unless of course your fiat was in gold and silver, which just jumped by about 46%. And, in case there is confusion, this is in process, and coming soon to every "developed world" banana republic near you.
and just as we (and Kyle Bass) have warned - this is what happens to the nominal price of a stock market as currency wars escalate... how do those US investors who flooded Venezuela with cash feel now? bringing back those VEF gains is going to hurt...
The chart above is a free lesson in nominal vs real: the hardest lesson for some 99.9% of the world's population to grasp. One person who certainly knows how to devalue a currency in real terms FDR, whose 70% devaluation of the USD courtesy of executive order 6102, is merely an appetizer of what is about to be unleashed upon the US.
Venezuela's export is oil
Oil is sold on the world market in US dollars
Listen to the gold peddlers or listen to your on common sense ...
Gold is not a viable alternative here..but as always YMMV
yea... do you want the dilutable currency or something that cannot be diluted?
keep spreading your FUD about ‘gold peddlers’.... gold’s only been the standard for 2000-4000 years.
Well, if you haven’t seen it before, it’s time once again for one of my favorite videos...
http://www.youtube.com/watch?v=EoS52fVtVQM
Even the Rappers understand.
Thanks Orange1998. This is one result of both The Obama Recession (which has had an impact on the world’s economies) and US fracking.
Great points and this will only increase the demand for dollars and American RE.
yup, and when old hugo reaches room temperature(if he hasn't already) it'll prolly get even worse
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