Posted on 02/12/2013 1:41:06 PM PST by IBD editorial writer
Economics: Venezuela has devalued its currency, joining Iran, Argentina and others whose wars on math brought the same result. Some call this a "restorative." It's not. It's what happens when big government hits a wall. Venezuela's monster 47% devaluation from 4.3 to 6.3 bolivars to the dollar, reportedly ordered by President Hugo Chavez from his hospital bed in Cuba, marks the reckoning for his regime's big-spending ways in Venezuela's low-growth economy. It was about as predictable as a crash from a runaway train, given his mad-lunatic war on economics — his lethal combination of welfare spending, destruction of the private sector and capital controls to cover up the disaster. And as in any train wreck, it wasn't something he could control.
(Excerpt) Read more at news.investors.com ...
This war on math talk has me confused. Are we still talking about Chavez or are we now talking about obama? Too damned many tin pot dictator thugs to keep them all straight in my mind.
The approaching global economic meltdown, generated by socialist monetary policies as described in the linked article will take us all down and the U.S. will make the biggest thud of all.
The thug hasn’t been heard from in over 60 days, he is on his death bed it seems like.
Meanwhile VP Maduro and President of the National Assembly are jockeying for position as his heir. They are even more crazy and incompetent than he is/was.
nobama is watching closely for a model to continue following.
This is a news story from the USA in two years, or less.
I worked down there for a short while in the late ‘80s, courtesy of an American rent-a-rig outfit. When I got there, the Bolivar had just been devalued from 4.3 to 14 to the dollar, but the govt made the businesses price their goods at the old rate. Four of us ate a great Argentinian beef steak steak dinner, complete with fried bananas and a glass of local brandy for $20. I was embarrassed to pay that little and thought of tales from guys who were in Europe right after WWII when the dollar “was as good as gold”.
I spoke with a guy who ran a ferry service in Lake Maracaibo - running crews out to the rigs in the lake (where they told me you only had to go down a couple of hundred feet to hit oil). He said then that Venezuela was a Third World country and if they didn’t straighten out they be Fourth. Later on, I wondered how he ever made out as that place continued to go into the tank.
I thought it too bad, as the people I worked with were OK, and put up with a lot of crap even then. It seemed to me that the upper crust took delight in crushing the low and middle class even deeper into poverty.
Later on the Bolivar went from 47 per dollar in 1990 to 177 in 1995, to 680 in 2000, and to 2090 in 2005, and now this. God knows what that Argentinian steak dinner costs now.
Actually the US has devalued its currency by about 50% since Obama has taken over.
Measure the dollar vs. corn, soybeans, gold, silver, gasoline and you will see what I mean.
The official inflation figure includes housing price deflation due to the bubble and technology advances. Get rid of tech inovation and housing and our currency has devalued a lot also.
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