Economics, Maduro Style

Kaiser-Kun · Dec 11, 2014

Venezuelan President Nicolas Maduro has called US senators "insolent" for passing a bill which would impose sanctions on Venezuelan officials found to have violated protesters' rights.

(...)

Mr Maduro warned the US leader: "If the crazy path of sanctions is imposed, President Obama, I think you're going to come out looking very bad."

"Who is the US Senate to sanction the homeland of Bolivar?" he asked, referring to the 19th-Century Venezuelan independence leader.

"We don't accept insolent imperialist sanctions," he added.

source

Oh well. Cancel everything, US senators.

Alessandra Kelley · Feb 2, 2015

http://www.bbc.co.uk/news/world-latin-america-31086391

President Maduro says that store owners are artificially creating the lines and shortages. He says supermarket owners are hoarding secret stores of goods and smuggling them out of Venezuela. He has had some arrested.

Don · Feb 2, 2015

Alessandra Kelley said:
http://www.bbc.co.uk/news/world-latin-america-31086391

President Maduro says that store owners are artificially creating the lines and shortages. He says supermarket owners are hoarding secret stores of goods and smuggling them out of Venezuela. He has had some arrested.

I'm sure the 63.6% inflation, falling GDP and ridiculous currency controls have nothing to do with the problem. It's the fault of those greedy shopowners, trying to sell goods for more than what they paid for them so they can feed their families and those of their employees, instead of selling them at a loss because Mr. Maduro has determined a "fair" price in inflated currency.

Or maybe there really is a major conspiracy between four major food chains, the international oil-producing community, the international banking cartel and "many Venezuelan businessmen plotting against his government."

I'm sure those thousands of protesters are in the street because a bunch of stores want to royally piss off their customers, not sell them any products, and not make any profit.

Interesting, too, that he didn't name the chain whose owners have been arrested.

Sounds like Mr. Maduro needs my tin-foil hat.

Diana Hignutt · Feb 2, 2015

Don said:
I'm sure the 63.6% inflation, falling GDP and ridiculous currency controls have nothing to do with the problem. It's the fault of those greedy shopowners, trying to sell goods for more than what they paid for them so they can feed their families and those of their employees, instead of selling them at a loss because Mr. Maduro has determined a "fair" price in inflated currency.

Or maybe there really is a major conspiracy between four major food chains, the international oil-producing community, the international banking cartel and "many Venezuelan businessmen plotting against his government."

I'm sure those thousands of protesters are in the street because a bunch of stores want to royally piss off their customers, not sell them any products, and not make any profit.

Interesting, too, that he didn't name the chain whose owners have been arrested.

Sounds like Mr. Maduro needs my tin-foil hat.

Nevermind...I thought you wrote "a conspiracy between the four major food groups"...

Don · Feb 2, 2015

Diana Hignutt said:
Nevermind...I thought you wrote "a conspiracy between the four major food groups"...

No, although it would be correct to refer to "a conspiracy between the four major food groups, the USDA, and Big Agriculture."

Don · Feb 19, 2015

Blat has become common in Venezuela.

By packing bags for $1 a day and with tips at a Caracas supermarket, Luis has managed to save up for a Japanese sports motorbike. His secret? Getting hold of scarce food before it hits the shelves.

Luis offers preferential access to detergent, milk and sugar to his clientele of about 100 diplomats at a Centro Madeirense shop in the south of the capital. In return, they offer him occasional work as a handyman or courier and loan him money during dry patches.

“Times are tough. We have to spin to survive,” Luis, 30, said in an interview in Caracas last month. “We have to be creative with the opportunities at hand to make ends meet.”

Price controls have emptied stores of most goods, while the world’s highest inflation has pushed what is available beyond the means of most Venezuelans. To make ends meet, they exploit the perks of their jobs to trade goods and services informally, mirroring networks that developed amid the scarcities in the former Soviet Union and came to be known as “blat.”

That reminds me of something.

When you see that trading is done, not by consent, but by compulsion–when you see that in order to produce, you need to obtain permission from men who produce nothing–when you see that money is flowing to those who deal, not in goods, but in favors–when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you–when you see corruption being rewarded and honesty becoming a self-sacrifice–you may know that your society is doomed.

Kaiser-Kun · Feb 19, 2015

And another problem: Birth control in Venezuela is getting very, very scarce.

Don · Feb 19, 2015

Kaiser-Kun said:
And another problem: Birth control in Venezuela is getting very, very scarce.

$755 for a box of condoms sounds insane until you realize that's at the highest "official" exchange rate of 6 to 1. At the black market rate of 190 to 1, it's about $25 for 36 condoms, which sounds pretty reasonable. OTOH, that means that the official minimum monthly salary of 5,602 bolivars is now worth only about $30, and not the $467 (or even $934) the official exchange rate would indicate.

"Wishing don't make it so" also applies to ridiculous government declarations, like Maduro's pretending that the exchange rate is 12 to one... or even more ridiculously, 6 to one as used in the article.

maxmordon · Feb 20, 2015

And they just arrested the mayor of Caracas without a warrant. When I think I have lost my capacity of astonishment, chavismo helps me to find it.

Kaiser-Kun · Feb 20, 2015

How's it over there, max? Have the protests stopped?

maxmordon · Feb 20, 2015

Pretty much. There were some small gatherings in Caracas for the anniversary of the arrest ofLeopoldo López but other than that, not much. Everyone is fearful, tired and apathetic.

Don · Feb 23, 2015

Maduro's tireless efforts have once again earned his country a first-place rating.

Venezuela is the world’s most miserable country, according to a team of researchers at Johns Hopkins University who have calculated a World Misery Index. “Misery” is measured as the sum of a country’s inflation rate, unemployment rate, and interest rate, minus the annual percentage change in real GDP per capita. The higher the total of these four numbers, the higher a country’s misery score. The index ranks 108 countries.

As the table at the bottom shows, the five most miserable countries in the world are: Venezuela, Argentina, Syria, Ukraine, and Iran. Venezuela’s misery score is almost 40 points more than second-worst Argentina.

Xelebes · Feb 23, 2015

What a highly specious measure of misery.

Don · Feb 23, 2015

Xelebes said:
What a highly specious measure of misery.

Let's ask the Venezuelans, Argentinians, Syrians, Ukrainians, and Iranians how inaccurate it is. Economically, it's a sensible yardstick of some value. High inflation, high unemployment, and high interest rates all cause considerable hardship.

Or would you care to argue that the Venezuelans, Argentinians, Syrians, Ukrainians, and Iranians are less miserable overall than the citizens of Brunei, Switzerland, China, Taiwan, and Japan?

ETA: Hold that thought. I'll be back Friday, after exploiting the citizens of Cozumel, Key West, and whatever third-world countries the staff of the cruise ship are from.

Amadan · Feb 23, 2015

Don said:
Let's ask the Venezuelans, Argentinians, Syrians, Ukrainians, and Iranians how inaccurate it is. Economically, it's a sensible yardstick of some value. High inflation, high unemployment, and high interest rates all cause considerable hardship.

So things are better in North Korea, Bangladesh, and the Sudan, huh?

I suspect the Syrians are more concerned about being crucified or beheaded than the inflation rate.

Alessandra Kelley · Feb 23, 2015

I suspect part of the reason those particular qualities are in the "misery index" is that they can be numerically measured. It would be difficult to assign a number to the fear of being beheaded, thus difficult to assign a rating or ranking of level of terror or misery.

Whether these qualities are most relevant to a people's misery may well be debated, but perhaps not here. The point is that life in Venezuela is currently miserable, not whether other people are more so somewhere else.

robeiae · Feb 23, 2015

Tangent...

From Don's article:

Venezuela is the world’s most miserable country, according to a team of researchers at Johns Hopkins University who have calculated a World Misery Index.

That bothers me. As far as I know, Steve Hanke is not a "team of researchers." He is a professor of economics at Johns Hopkins, true enough, but his work is his own. And it's not all that complicated. His "misery index" has been around for a while and is just a more thorough (imo) version of the traditional "misery index" (unemployment plus inflation) created by Arthur Okun back in the 1960's.

As a snapshot of current conditions, I think it's pretty damn good. And that's all it's supposed to be. The "rankings" are not supposed to be viewed as absolute in the least. Per Alessandra, they just indicate a likelihood of "misery" because of these conditions.

maxmordon · Feb 26, 2015

Venezuelan National Guard shots dead 14-year-old student

Maduro, always a class act, said the kid was part of a "right-wing sect".

Don · Feb 27, 2015

What rob said. Also, to Amadan's point, North Korea, Bangladesh and the Sudan don't show up in that analysis, apparently because those numbers are not available from the respective governments. It only analyzed 108 countries, so presumably those figures aren't easy to garner for the rest. Cuba's not shown either, for example. It's surprisingly hard to find believable economic data for a lot of "people's states," for some unfathomable reason.

Kaiser-Kun · Mar 17, 2015

Max, do you know if it's true that Maduro suffered a claustrophobia attack when he climbed into an old soviet tank last Saturday?

I know we shouldn't laugh at a phobia attack, but dat face...

Amadan · Mar 17, 2015

Kaiser-Kun said:
I know we shouldn't laugh at a phobia attack, but dat face...

Somewhere, Michael Dukakis is laughing.

maxmordon · Mar 17, 2015

Nope, it was an Onion-style of news website, apparently. Also, what's the Mexican equivalent of The Onion? Ours is El Chigüire Bipolar.

Kaiser-Kun said:
Max, do you know if it's true that Maduro suffered a claustrophobia attack when he climbed into an old soviet tank last Saturday?

I know we shouldn't laugh at a phobia attack, but dat face...

Don · Apr 7, 2015

Venezuela Achieves the Glorious Final Stage of Socialism

Venezuela’s product shortages have become so severe that some hotels in that country are asking guests to bring their own toilet paper and soap, a local tourism industry spokesman said on Wednesday.

In Merida, a state in western Venezuelan that’s known for its stunning mountain landscapes, small hotels are struggling to stock their rooms with basic supplies, especially as the busy Semana Santa or Holy Week holiday gets underway.

“It’s an extreme situation,” says Xinia Camacho, owner of a 20-room boutique hotel in the foothills of the Sierra Nevada national park. “For over a year we haven’t had toilet paper, soap, any kind of milk, coffee or sugar. So we have to tell our guests to come prepared.”

But wait, there's more!

Recently, Venezuelan officials have been stopping people from transporting essential goods across the country in an effort to stem the flow of contraband. So now Camacho’s guests could potentially have their toilet paper confiscated before they even make it to the hotel. “It’s an absurd situation,” the hotel owner said.

Somebody needs to pass Maduro this link.

Don · Apr 29, 2015

Maduro Administration Takes CitiBank to the Cleaners

In another stroke of economic brilliance, Venezuela's central bank has swapped 1.4 million troy ounces of worthless shiny metal to CitiBank for $1 billion in the best deal since Jack swapped his cow for magic beans.

The deal works out to about $714 per ounce of gold.

The current spot price for gold is $1210 per ounce.

Venezuela scored almost 60% of the metal's current value in the brilliant swap.

I'm buying at $720 if anybody else wants to follow this profoundly clever economic strategy.

ETA: Whether this was an outright sale or simply a pawn job is not completely clear.

Don · May 14, 2015

According to NPR, Venezuela is now suffering from another Maduro-inflicted shortage:

Comedy.

It's No Joke: Venezuela Cracks Down On Comedians

Besides jailing opposition leaders and cracking down on protesters, the Maduro government is now going after comics.

Marquez says that three of his recent shows were canceled after all three clubs that booked him were suddenly closed down for alleged tax evasion. He's also been shut out of government-run theaters and hotels.

Another headache is securing city permits to perform. Requests from controversial comics are often rejected by mayors loyal to Maduro, according to comedian Alex Goncalves.

Apparently, besides toilet paper, drinking water, and life-essential medicines, Maduro's central planners forgot to budget adequate resources for a sense of humor.

Economics, Maduro Style

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Sophipygian

All Living is Local

Very Tired

All Living is Local

All Living is Local

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All Living is Local

Penúltimo

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Penúltimo

All Living is Local

Delerium ex Ennui

All Living is Local

Sophipygian

Touch and go

Penúltimo

All Living is Local

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Penúltimo

All Living is Local

All Living is Local

All Living is Local