Archive for the 'Uncategorized' Category

Hyperinflated Arepa Index (HAI) X: One year, 441% rise

November 17, 2015


Today is November 17th. It was exactly one year ago that I went to my favorite arepera and surprised at the sudden rise of my also favorite arepa con queso de mano, pictured above, that I decided to start keeping records of the price in each of my visits.

Today, there are no graphs. They are not needed. One year ago, the arepa was Bs. 120. Today it was Bs. 650. That is a rise of 441.7% in twelve months (sorry, I had subtracted twice the 100%, one in the spreadsheet and one in my mind*). Absolutely depressing…

There is little that I can say positive about this. At least, scarcity did not hit my arepa directly and I was able to eat it each time I went. Tonight’s was particularly delicious, the guy heard me when I asked for the “mas tostadita” (the darkest one) one and, as you can see, the filling was quite generous too. Depressingly enough, the tip I gave him was almost the price of the arepa one year ago. At least he deserved it for his service…

*How did I do that? Easy, I did not look at the spreadsheet cell which already subtracted the 100% and thought it was the ratio, rather than the actual calculation, thus I subtracted it twice, one in the cell, the other mentally.


800 Kilograms Of Arrogance Arrested In Haiti

November 11, 2015


When I first read the ABC piece on the detention of the nephews of Venezuela’s First Lady in Haiti for attempting to bring 800 kilograms of cocaine into the US, it sounded too far-fetched to be real. It sounded right out of a movie plot: They were caught in a sting operation, trying to move 800 Kilograms of cocaine into the US, the whole thing was filmed and they argued they had diplomatic immunity.

Far fetched, because what saved General Carvajal, was that he actually had a diplomatic position in Aruba. You see, it is one thing to have a Diplomatic Passport, another to have Diplomatic immunity. Any Joe Bimba can get a diplomatic passport which lasts four years in Venezuela, but, for example, if you are removed from your position, or if your trip was not an official trip, that immunity is simply worthless.

Long time ago, I flew to NY and a friend from primary school was on the plane. His father happened to be Venezuela’s Foreign Minister at the time. He had a Diplomatic passport and readily passed us to go to the Diplomatic line which, in contrast to ours, was empty. A few minutes later, he came back to the back to our line and stood in it like a regular citizen. When we were waiting for the luggage I asked him what happened and he told me that the immigration agent had asked him if he was on an official trip to the US. He said no. Then he was asked why he had a Diplomatic passport. He explained. To which the agent asked if his father was in the plane. As the answer was no, then he was sent to the regular line, as his passport may have been diplomatic, but not even the privilege of using the diplomatic line was available to him.

But such is the arrogance of Venezuela’s revolutionaries that they don’t even learn from their experiences. They have moved around funds, drugs and who knows what else, using private or public planes, through well known banks and countries, thinking they were flying under the radar, until they were not…

Meanwhile, the silence of the Venezuelan authorities is as loud as that of most local newspapers, which took a while to republish the news. Amazingly enough, it was revolutionary aporrea which followed Tal Cual with the news, while we are still waiting for El Universal to say anything. But news sources from the WSJ, The New York Times, Reuters and CNN, have all confirmed the story carried first by Spain’ ABC.

Meanwhile, we should know the details tomorrow as the First Lady’s nephews, one of which was raised by her directly, are arraigned in New York. Among the details to watch for, is whether there are videos or not, who owned the plane, a Citation 500 (Sabenpe?) and what the Government says or not. Interestingly, in the absence of news, the Government has so far preferred to stay quiet.

Much like the upcoming elections, I don’t view this as something that will change history, but more as part of the continued erosion of Maduro’s hold on power. Each bit of arrogance, indecision and defeat, adds to the internal divisions that will eventually lead to his demise.

This 800 Kilograms of arrogance by Cilia’s nephews, will simply add to the tally.


Here is the Indictment


Making A PDVSA Bond Exchange Attractive

November 8, 2015

People have gotten all worked up about some statements made by Pdvsa’s President (who has other cambures now) that the company may “talk to bondholders to modify the maturities in the next two years in order to make them more manageable”.

What he is talking about is about a voluntary exchange by bondholders, something bondholders always are willing to listen to: Pdvsa would offer people to switch the US$ 1 billion in PDVSA 2016 and the US$ 4.1 billion of the PDVSA 2017 N, which matures in two parts, half in 2016 (US$ 2.05 billion) and US$ 2.05 billion in 2017.

While some form of exchange proposed to bondholders is definitely workable, the key here is the word voluntary: You have to offer bondholders something attractive in order to make the switch. From Pdvsa’s point of view, you want to maximize the number of bondholders that accept the exchange.

As I said above, people have gotten very excited about this possibility, because in the end, Pdvsa’s problem is one of liquidity and moving the Pdvsa 2016 and 2017N maturities two years down the road, would certainly boost the company’s bonds prices.

Except it would be very expensive. Like very, very expensive…

The plot below shows the price of the PDVSA’s 2016, 2017N and 2021 bonds (blue diamonds), together with its yield  to maturity (red squares):


The yield to maturity of the PDVSA2016 is 30%, it goes up to 50% for the 2017 with the low coupon and then drops again to 30% for the PDVSA 2021. I have also plotted the blue triangles which are the bond prices and, since there are no bonds maturing in 2018, 2019 and 2020, I have drawn free hand (using the Venezuela curve as a guide) a yield curve through the three points to try to capture the yield that would have to be offered in 2018, 2019 and 2020 in a proposed exchange. This is shown as large blue circles.

Now, let’s assume (there are many ways of doing this), that the idea is to move the 2016 to 2018 and the 2017N into two bonds, one in 2019 and the other in 2020, since there are no PDVSA bonds maturing in that period.

Let’s just consider the first case: Let’s offer something for the PDVSA 2016 to be exchanged one-to-one for a PDVSA 2018. As you can see from the graph, the PDVSA 2016 today is worth 79%. So, if you are holding 100k of that that bond you can sell it tomorrow in the market for 79k. So, anything the Government offers you, has to be worth 79k.

So, if we assume the 2018 bond has the same coupon of about 5% (I did not do exact calculations), from the graph yo can see that a 2018 bond with a 5% coupon, would have to yield 58% to maturity. In order for that to happen, the bond would be worth 27.5% of its face value.

This means that for it to have the same cash value today as the 2016, you would have to offer me 79k/27.5k= 2.87 times the face value!

This means that for a US$ 1 billion bond, you would have to offer US$ 2.8 billion in new bonds!!!

Sort of expensive, no?

But wait!!! Why would I take it? Where is my incentive? You are offering to give me a bond which is three years longer, that is worth the same as mine is worth today, same coupon. I am not interested, I will just wait until the PDVSA 2016 matures.

So, unless PDVSA offers MORE, this is not attractive. So, PDVSA would have to offer either more coupon or more capital, which would make it even more expensive.

See why this is not a piece of cake? Yu have to offer more capital or more coupon. Or both.

Some expert reader will be thinking: Oh, Devil! You are lying to us, because PDVSA can always offer more coupon and then it does not have to offer triple the amount…

Very true. But my calculations show that if PDVSA offered a 15% coupon for a 2018 bond in exchange for the 2016, it would have to offer you twice (Yes a factor of 2 instead of 3) as much as you have today, which would be cheaper, as three years of the extra 10% would only add up to 30% over the life of the bond. But going higher in coupon would certainly run into problems. And a factor of two is not exactly cheap.

But again, this is a theoretical case IDENTICAL for the investor than what he has today. On top of the double and the higher coupons, investors are going to ask for more. Either more capital, or more interest. Or both.

See the problem? It is very expensive to do this exchange and it means that in the end PDVSA would have a higher debt and the problem will be back in 2020, when PDVSA hopes (and prays!) oil prices would be higher.

Maybe PDVSA will just be running in place anyway.

To do this for the 2017N bond is not as onerous, but is still very expensive, I will not take you through the details, because it is a more complex case, but let’s just say that even at a 15% coupon, the bonds for 2019 and 2020 would be worth 35-40% of their nominal value, which implies you would have to pay people 1.5 times what they are owed today, plus a premium, plus the higher coupon.

Is there a cheaper way of doing this?

Well, yes, but no. Let me explain…

If PDVSA had not committed all that oil to the Chinese to pay for the Chinese loans, PDVSA could issue an oil-backed bond. Let’s say, for example, that PDVSA would sell oil every day to pay for these bonds (principal and interest) and each quarter, you would get paid part of the principal from a trust where the proceeds from the sale of the oil go to daily, plus interest.

If the bond is a two year bond, for example, you would get 1/8 of the principal paid each quarter plus interest. What’s the advantage? That if the bond is backed by oil exports, the interest rate (the coupon) would be much lower. Like way lower…5% maybe (guessing) on a two year bond. Now, an asset-backed loan like this, would be very attractive for investors, much like it was for the Chinese, as the structure is basically how the Chinese loans function: PDVSA sends oil, the proceeds go to a Chinese bank and the Chinese pay themselves from it.

Unfortunately, PDVSA likely has no ability to back the bonds this way, it probably has little spare production for this. But just think, it could offer the production as guarantee, just to lower the interest rate and then pay it with cash, if it has it. There are many ways to skin this cat…

Like the Republic could use some of the gold in the reserves to issue bonds guaranteed by the gold, but this would be just a way of lowering the coupon, the gold would be there just in case.

But, I digress. The main point is that a simple voluntary swap is not that doable due to the low bond prices. This makes it very expensive and seems like just kicking the can down the road.

Hard to get excited…and not as simple as people may think.





Venezuelan Central Bank Files Complaint Against Dolar Today In The US

October 24, 2015
View this document on Scribd

Thanks to the generosity of my readers, three of which sent me last night the document above, I managed to read the suit that the Venezuelan Central Bank filed against Dolar Today LLC, a Delaware company which supposedly owns the homonymous website and its related apps and channels.

I am no lawyer, but I did find this document remarkable in many ways. Perhaps the most ironic thing to me is that the Venezuelan Government via its puppet Central Bank (which the complaint says is independent), wants to use the US Justice system, daily criticized as unfair and manipulated by them, as a way to exert pressure on this webpage and even more audaciously, to seek “damages” from them.

But I am sure my followers will certainly enjoy the reading of this document full of the same crap that the Government spews out on a daily basis, this time translated into English and presented in legalese. And I am sure that the only intent of the complaint is or was to intimidate those involved with the website and its activities. Here I will refer to what I found ironic, hilarious, stupid, and enjoyable, without intending to be comprehensive. I invite my readers to add their own in the comments for everyone’s enjoyment.

To begin with, the only possible objective of this suit is to harass, intimidate and otherwise distract the owners of the Dolar Today webpages with the complaint. They will have to hire lawyers, spend money, go to deposition and the like.

The second interesting thing, to avoid saying laughable, is that says that Dolar Today is violating Article 1185 of Venezuela’s Commercial Code. That may well be, but the Judges in Delaware could care less about this violation, given that that is the law of the land in Venezuela, but certainly not in the US nor Delaware.

But it has to be laughable to argue that a webpage has created a form of cyber terrorism that has “wreaked, economic and reputational harm on the Venezuelan Central Bank by impeding its ability to manage the Republic’s economy and foreign exchange system.” by “Creating the false impression that the Central Bank and the Republic are incapable of managing Venezuela’s economy.”

Jeez, if a simple quote of a rate can do that and the Government and the Central Bank can do nothing about it, it would seem to me that the problem is not what the webpage did, but how clueless were the Government’s actions in trying to stop it. In fact, most Venezuelans remember multiple announcements suggesting that the Government was ready to “pulverize” the black market rate, but none of the plans were successful and in many cases people wondered what happened to them.

And you have to laugh at statements such as “Much of the world, including numerous members of the International Monetary Fund (“IMF”), engage in something that is both literally and figuratively quite foreign to the United States: the multiple exchange rate system.”

I would love to hear Nelson Merentes tell me the names of these “numerous” countries, assuming that given that he is a Mathematician, he will not argue that numerous means two or three countries. In fact the word numerous means “many” or “great in number”, which is simply false.

And you really have to be a cynic to suggest that the inflation rate in Venezuela is high simply because “it is an expected consequence of the Republic’s policies to promote social inclusion of the poor and economic growth”, when inflation is the worst possible indirect tax on the poor and those not included socially.

And since I am nitpicking, let me take advantage of it by noting that it is not true, as it says in numeral #26 and #43 of the complaint, that Venezuelans trade at the parallel or black rate via exchange houses. Such trades are not allowed at exchange houses and Venezuelans only can do these transactions privately.

Additionally, in the second graph of the complaint, the lawyers show a graph in which the parallel rate closely follows the implicit rate and only starting in October 2014 did the two diverge. In fact, had the Government made a long term plot of that, including the period before the “swap” market was shut down in May 2010, it would have shown that factors of two differences between the two have occurred before. Curiously, this widening of the difference between the two began taking place when oil prices began to drop and the Government no longer had “excess” funds to feed the black market, as an article in this week’s Wall Street Journal suggested was done via PDVSA in order to enrich a few individuals.

But the bottom line is, that the BCV and its lawyers will have to “prove” first, that Dolar Today actually manipulated the rate it published and second, that it used that information to benefit financially, something that I find extremely difficult to show. In the US, in the process of discovery, you have to support your accusations and if what you have is flimsy, the Judge is likely to throw at the case at the earliest stages of the process.

Simply put, how can they prove there was “wire fraud” or that the rate was set in order to to obtain a profit? A profit with respect to what?

And you have to love the fact that a Government that has shut down any possibility of a market for the parallel rate of exchange wold argue that “the DT Rate does not reflect any actual exchange market”. Of course, there are none allowed in Venezuela! The only “market” that exists is the border market in Colombia, which Dolar Today claims to use to set its rate.

In fact, between 2003 and 2010 the “swap” market existed and was legal and one could argue that it gave the rate transparency and liquidity, but it was the actions by the Government to shut it down that created the distortions that the BCV wants now to blame Dolar Today for.

I am also not so sure that you can prove a rate is “fraudulent” as the complaint charges. Even if the BCV could prove there was a transaction, it would prove that someone was willing to pay a particular rate and thus it would be hard to argue it was fraudulent. That is precisely what I tell people that say that the rate is being manipulated: Find me someone that sells them cheaper than that…or you sell it to me, since you can find it cheaper.

I have found no one that wold take me up on it.

I will stop at this, enjoy the reading. But if I could, I would suggest this to the Government: Allow a legal market to function for the parallel rate, I would bet that in time that market would find an equilibrium rate not too far or higher from where it is today. Because in the end that rate reflects the same lack of foreign currency which is causing causing lines, shortages and inflation. And it is the stubbornness of the Government to adjust and use economic theory that has created the distortions, including the anguish, pain and deaths of the thousands of people who can not get medicines or adequate medical care.

But the irresponsible regime of Nicolas Maduro wants to blame a web page…

(Maybe the complaint should be turned around and some Venezuelans should sue the Central Bank for the same reasons, but saying that by not following its Constitutional mandate of independence and monetary stability, it has caused harm on the Venezuelan people)

Electoral Cheating in Venezuela, One Deputy At A Time

October 13, 2015


All of what I will write in this post can be found elsewhere, but I thought it was important to show and save it into this database of abuses and  rip-offs that have characterized Chavismo, as well as explain it in English. I am not trying to discourage people. I am just trying to show how Chavismo is moving all of its power to minimize the oppositions vote in December, without any ethics, morals and with blatant abandon.

To begin with, within the MUD, there used to be a party called MIN Unidad. In one of those strange moves, the Electoral Board, removed the Board of MIN Unidad, replacing them with others who claimed to be owners of that particular political country club. The MUD proceeded to suspend Min Unidad from the MUD, as it could not guarantee the “purity” and backing of the MUD by anyone named by the CNE.

Next thing you know, parties had to choose the location of their party on the upcoming ballot and MUD got to choose before MIN Undad. Where did MIN Unidad choose in the ballot above? Precisely next to the MUD Unidad location, as you can see in this blow up:


a strategy clearly designed to fool voters into believing that MIN Unidad is part of MUD Unidad, which it ain’t.

You may think this is a dumb trick, but it works. Too many people get flustered when voting with these machines and can be confused by such subtleties, even if they have been warned about it. In fact, I went with my then elderly mother to help her cast her vote a few years back and even though she had memorized every step, once she was in front of the ballot, she had no clue as to what to do.

Clearly, the MIN Unidad location and design should nit have been allowed by the Electoral Board, but ethics is a four letter word among Chavistas, so there was simply no recourse and the position of MIN Unidad in the ballot stands for the upcoming Parliamentary election.

But it gets worse…

Let me now show you that ballot in better definition for Circunscripción 1 in Aragua State:


In the MUD Unidad ballot is Ismael Garcia, a former Podemos leader who is clearly opposition. But wait! In the Min Unidad the candidate is also Ismael Garcia. What gives?

Well, the MUD registered Ismael Garcia and Jose Trujillo on August 7th. as its candidates. On August 15th. MIN Unidad registered its two candidates Eduardo Nava and Belkys Cermeño. But then, within the period that you are allowed to do it, MIN Unidad changed its candidates to Isamel Garcia (Not the same one as the MUD) and Freddy Solorzano.

Thus, when people see the ballots, they will not necessarily know which one is which. This is clearly an unethical attempt to deceive and take votes away from the “real” Ismael Garcia. While the law does not forbid two candidates with the same name running for the same office, the CNE should have at least made sure that voters could differentiate the two. But, of course, they hide behind the law and their lack of ethics.

The point of this article is that there are 1001 tricks that Chavismo will apply come Dec. 6th. but people are not being warned enough or not enough has been done about them. Instead we are supposed to go vote innocently into this unfair set-up with everyone thinking that we will get 80% of the votes and thus Deputies. I don’t believe this is a responsible way of handling this. People are supposed to shut up, move forward and maybe win, but maybe lose too.

I warned about all these tricks in August, if the above is not proof that Chavismo’s bag of rip-offs is not full of them, then let me sell you a used car. Really, it’s in great condition, low mileage, only one owner…cheap too!


Venezuela’s Vital Signs by Paul Esqueda

October 11, 2015

I have been under the weather for a week now and the two articles I have been plotting in my mind have not been able to get completed. But fortunately, my good friend Paul Esqueda, who has written here before, sent me the article below, which is timely and something I was worrying about, since about ten days ago Venezuela’s Minister of Finance “promised” investors in New York to  publish some of the missing data. But to this day, we are all still waiting, including Paul:


The vital economic signs of the country constitute key information in fundamental decision making by all individuals and organizations operating or planning to operate in Venezuela. The Venezuelan Central Bank has not published the main economic indicators of the country in the last nine months, particularly inflation (Consumer Price Index) and gross domestic product (GDP). This is in total contradiction with what is stated in the by-laws of the bank in its Article 31, which is a national act of Congress. It clearly states that “The Central Bank of Venezuela will be guided by principles of transparency. In this regard, without prejudice to their institutional responsibilities, the Central Bank will keep informed in a timely and reliable manner the National Executive and other State agencies, public and private, national and foreign and the public in general on the implementation of their policies, decisions and resolutions of the Board, reports, publications, research and statistics to have the best information on the evolution of the Venezuelan economy, without compromising the confidentiality rules as appropriate in accordance with the Constitution. In fulfilling the mandate above, the Central Bank of Venezuela will perform regular monetary policy meetings and publish the minutes of such meetings through the means which it deems appropriate, including use of the most advanced computing services.”

What are Venezuela’s official vital economic signs? If you are entering the workforce or retired or considering retirement, is your projected income sustainable and sufficient in the long term for a decent living? How are companies currently operating in Venezuela planning their operations without reliable information? Are there any potential investors interested in Venezuela in such state of affairs? These questions and many others would have to rely on second hand sources (IMF, IADB, Dolar Today, and the Devil’s Excrement among others) to find answers for the moment. The current Venezuelan Government has chosen to let uncertainty reign by providing no information based on the fact that there is a state of “economic war” There is no formal official declaration of war against any specific entity so that excuse just adds to the uncertainty and to the overall country risk.

The vital signs of a person’s health are typically body temperature, pulse, blood test results, ability to breath and move about. When an individual is found outside the normal parameters in all the risk factors, the medical doctor can make informed decision about next steps to improve the person’s health. An extreme situation may require putting the patient in the extreme care unit on a respirator with all his/her vital signs being monitored 24 hours a day. The vital sign are critical to determine whether to continue life depending on the prognosis. What is the state of the Venezuelan economy’s health? What is the general perception of the credit rating experts? The rating of Venezuela ranges from CCC and Caa3 (S&P, Moodys and Fitch) as of 19/11/2015 which qualifies the economy as “extremely speculative.” Is Venezuela in a nonresponsive state by not releasing the main economic indicators? When a patient is in a nonresponsive state, he/she has no knowledge but those around him/her do know. Is the average Venezuelan conscious of the gravity of the situation? Are lenders pulling the plug on Venezuela? Where is the transparency declared in law of the Venezuelan Central Bank? Is it a crime to mismanage the economic future of all Venezuelans with evident violations of the law?  Undoubtedly history will pass the final judgment.

Hyperinflated Arepa Index IX: Index Resumes Rise

October 5, 2015


We knew it would not last, and the Hyperinflated Arepa Index (HAI)  resumed its rise, jumping from Bs. 440 to Bs. 580 in the last month, for a 31.8% rise. With this rise, the HAI is up 283% since last November 17 2014, indicating that it will likely hit the 300% rise in its anniversary.

This is likely assured, given that in the next two months, monetary liquidity (M2) will rise somewhere between 15% and 20% as has been traditional when the Government pays its end of the year bonuses. This will put even more pressure on prices, including that of the parallel rate of exchange.


I inquired again about the drop last time with the owner, but he sort of evaded the question, saying again that they changed their invoices (???) but there was no real drop. The drop will remain a mystery for the time being.

Human Rights and Chavismo/Madurismo

September 22, 2015


I am sure that I am not the only one offended by the picture above. Chavismo not only blatantly violates Human Rights, but on top of it, has the audacity to hold an event to promote the content of its 2015-2019 National Plan for Human rights, under the heading: “Venezuela a country guarantor of Human Rights”

The plan itself ignores the country’s Human Rights reality. In Geneva, the UN found the Venezual’s homicide rate to be one of the most profound violations in Human Rights, there have been 231 thousand homicides under Chavismo, but the document presented by the Maduro Government fails to mention  homicides at all and the “consultation” period for the plan ends in only a week.

And while this plan is being built up, written and delivered, the Maduro Government created out of the blue, a series of violations of Human Rights at the Colombia/Venezuela border, which are not mentioned either. To say nothing of the infamous OLP’s, police and military operations, which come into barrios and kill people, like on the Cota 905 in Caracas in July, when around 18 people were killed in these “operation”, without the People’s Ombudsman, ironically called the People’s Defender in Venezuela, saying anything about it.

To someone like me, who was born under the Perez Jimenez Dictatorship in the 50’s and witnessed the horrors of the South American Dictatorships in the 60’s and 70’s, the ability of Chavismo to ignore and disrespect Human Rights is quite difficult to understand, let alone the deafening silence by those Governing Chile, Argentina, Brasil and other countries, whose Presidents and Government officials and their families were victims of the same Dictatorships.

But while those that followed the Dictatorships in the 70’s and 80’s made sure to guarantee Human Rights in the future by creating legal instruments that bound all countries by commonly accepted Human Rights principles, those that followed them in Government, all “left wing”,  seemed to have forgotten the past and decided to simply ignore Human Rights.

And while the Government holds these bombastic  Human Rights events, officials screw up at every turn in clear demonstration that Human Rights is not even discussed extensively within the Government.

Take Jacqueline Faria, for example, a PSUV member who dared say “All of those that are legally in our territory have their Human Rights guaranteed”

How cynic can you get? If you are illegal, you simply have no Human Rights, as has been clearly demonstrated by the treatment of Colombians along the border, which has actually caught some legal Colombians in the process, but nobody is around to defend them anyway.

And the People’s Defender had the gull to say that student Marcos Coello’s accusations of torture had no validity, because he had become a fugitive of Justice, as if Coello was supposed to stay and suffer more torture, as a way of promoting his cause. The truth is that Coello had denounced repeatedly how he was tortured in Mr. Saab’s office, before Mr. Saab became Ombudsman, but the case was simply shelved. Coellos’ mother wrote a wonderful letter to Mr. Saab, noting that on March 17th. 2014, Coello’s case was presented to his office and the Prosecutor’s office, which were followed up later in March and once again in June, but to the date, as Mr. Coello decided to leave the country and become a “fugitive” with no Human Rights, according to Saab, the Prosecutor’s office has not moved a finger to investigate the student’s torture or his tortures.

And let’s not forget Ines Gonzales, “Inesita La Terrible“, a Ph.D. in Chemistry, who was jailed 18 months ago for taunting the intelligence police in her tweets. Today we hear that Saab will “mediate” so that the Judge can allow her to leave jail and  have a complete hysterectomy. But Saab should mediate to have her freed, because tweeting your opinions is a right guaranteed by the Constitution.

But what does he know?

But Saab, much like his predecessors in the position, could care less about Human Rights. Human Rights are Human Rights, they do not depend on whether you are free, in jail, a fugitive or “legally” in Venezuela or not. They have to be respected and those in charge of enforcing them are supposed to do just that. In fact, I am sure that Farias and Saab are careful enough not to say that Human Rights are guaranteed only to those legally in Venezuela and those that support the Government. Because in the end, Chavistas seem to have more “rights” than others, or opposition members seem to have fewer rights than Chavistas. But in the end, Chavismo could care less about Human Rights. Those that are victims of homicides are more likely to have been or be Government supporters than opposition and the rate of homicides has never been a priority since Chávez arrived in 1998. And neither are many of the rights guaranteed by the Venezuelan Constitution.

But maybe I am just an innocent flower child of the 60’s and 70’s.

But wait, so were Bachelet, Roussef and many of those that today ignore the Human Rights gains of the 80’s and 90’s and place their commercial interests above Human Rights and Democratic (With a capital D) rights in Venezuela…

And yes, I may have been an innocent, naive, flower child of the 60’s and 70’s, but I will not forget. If we ever get rid of these people, I will be around to write about the barbaric acts and statements by Saab, Farias and their cohorts. I will use my blog and records to emphasize that I will only reconcile with those that were not involved in Human Rights violations and that crimes against humanity never expire.

Maybe nobody will listen, but I will be there…




Miserable Decision Against Leopoldo Lopez No Surprise

September 12, 2015


I have been traveling and ever since I heard about the miserable thirteen years and nine months sentence against Leopoldo López, I have been trying to put together my thoughts on the matter, but it is not easy.

Not that I did not expect it, I did. Leopoldo López was identified early by Chavismo as someone that needed to be neutralized. When he was Mayor of Chacao he was barred from running for office for seven years using a procedure via the Comptroller which had no legality, but which stopped him at the time from running for office. The excuse was that López used some funds to pay salaries earmarked for something else. Of course, no equivalent decision was made against Nelson Merentes who used billions of dollars, not millions of Bolívars for the same purpose as López. But, of course, Merentes has never been interested in being elected, he prefers being named to positions he is not qualified for. But I digress….

Rather than being deterred by his ban from running, López began forming a party and took his case to the OAS’s CIDH, which ruled in his favor. He then ran in the opposition’s primary in 2012, withdrawing and supporting  Capriles who was clearly leading the polls. He was an invaluable asset to Capriles, developing the strategy to have witnesses at polling stations, which limited phantom votes by Chavismo. He helped Capriles end up in a virtual tie with Maduro in 2013, but we all know how that was untied.

Then in 2014, Leopoldo embraced the controversial “La Salida” strategy, in the understanding that if you don’t poke a Dictatorship in the eye, the monster does not leave power. After some demonstrations ended up in deaths, most provoked directly by Government agents, the Maduro Government charged Leopoldo with “subliminally” inducing the violence leading to these deaths, initiating the travesty of the judicial process that just ended. Lopez was not allowed to present as evidence videos that demonstrated that the charges by the Government were false. The trial was closed to the public and López was sentenced to more yeas than Chavismo will remain in power, proving once again the stupidity and shortsightedness of autocrats. Curious that the Judge sentencing Lopez was the same that quietly freed some prominent Chavista boliburgeois on December 31st 2012, who had accumulated fortunes in a short time and were jailed during the 2009 mini-banking crisis.

And Leopoldo has been poking at the regime like no other politician, even from jail. First, he refused to leave the country opting instead to go to jail. Then he went on a hunger strike which he stopped when he wanted to, not when the regime wanted. And he has been communicating from jail, embarrassing the regime over and over.

And his wife Lilian has taken over a role that I am not sure she ever planned to. She has been impressive an relentless, helping to convince the world that Venezuela is far from being a democracy or be a country in which justice or due process exist.

But one has to feel for Leopoldo and his family. I don’t know Inesita La Terrible, a scientist who was jailed for her tweets, but I feel for her, because she got her Ph.D. at IVIC and I would have known her if I had not left science.

But I do know Leopoldo and his wife. Not closely, but I have had some serious conversations with him and I was always impressed at his commitment and his willingess to listen and understand. Even if he is committed, even if he sees this as a necessary step, he must be having a very rough time. And I can not even begin to imagine what he is going through.

But the fatal mistake by the regime is, like many other repressive regimes before them, that they have managed to lift Leopoldo to another level. A level that one day will take him very far in Venezuela. And by fighting and poking the regime in the eye, he wold have deserved it. No other politician has come that close to staking everything on removing Chavismo like Leopoldo. If they had, maybe we would not be where we are. I am in the radical camp, you need to poke and stir as often as possible, make the regime react. If not, we will be in the same spot decades from now.

To me, the miserable decision against Leopoldo, does little for the Government, except in that it removes him as an organizer in the upcoming election. But few Chavistas will be encouraged to go and vote because he has been sentenced. On the contrary, at a time that so many former pro-Chavismo and even Chavismo supporters are questioning the Government, jailing Leopoldo, who is very popular in all levels of society, only adds to the doubts.

And the MUD should take the jailing as a warning. A warning that Chavismo will not play fair in December. And that with Leopoldo absent, our ability to stop fraud is reduced. And the decisiveness to act on Dec. 6th. and 7th. when Chavismo decides to manipulate results, will not be there, but in the Ramo Verde jail.


Hyperinflated Arepa Index VIII: A Surprising Drop!

September 6, 2015


On the eight time to get a data point, Miguel gets all cocky and invites a buddy, the same guy that wrote the Wall Street Journal article and we went and had some pretty nice arepas. I had my usual, while Kejal had a caraotas and yellow cheese arepa, as he has become Venezolanized in his five years here. This one did not count, the same as the delicious mango juices that I had. We went for the data point on the arepas, but the conversation was so good, that it became an afterthought, it was just intriguing to find out how much the HAI went up.

Except it went down.

As I sat there trying to comprehend the Bs.389 number for my queso de mano arepa, I could not help but call the waiter and ask: What happened, how come prices have dropped?

I was, of course, expecting a tale of pressure, visiting agents or whatever, but instead, the apparently clueless waiter started going on a tale about how they now separate the VAT from the price and the 389.75 was without the VAT.

So he brings over a menu to prove it and it says my arepa con queso de mano is Bolivars 440 with VAT, except ther is no way that 389.75 plus VAT adds up to Bs. 440. But he claims it is that number. (It would have to be 391.1 and that was not the number in the receipt)

So, I have to use the menu number Bs. 440, a Bs. 30 drop from the last time. And even if the waiter seemed clueless, I have to think that something happened, but can’t confirm it.

And it makes little sense that it dropped, unless there was some pressure to drop prices, as I had visited the Mercado Libre de Chacao and found that cheeses, the delicious un-pasteurized Venezuelan white cheeses, went up sharply since my last visit. About 40% if I remember correctly.

But a data point is a data point and the first drop in the HAI occurs nine and a half months after it was started. This is a 6.3% drop in five weeks, a 166% rise in nine and a half months.

I had actually expected a 20% rise, but I have been wrong every single time about my expectations. I stick to the data and we now wait till the next number in one more month…

(The arepa was still delicious and only 59 cents and the last exchange rate of the unmentionable rate. But, of course, Venezuelans earn Bolivars, not dollars. This is very expensive for them.)


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