Little to say, the band system is from Bs. 4.2 to Bs. 5.4 per dollar. Banks reportedly will sell 40 milln $ a day. Limits will be $5,000 per year per person, $300,000 per month for each company.
You can bet all orders will be done at Bs. 5.4…and most Venezuelans will ask fir the 5k yearly at these prices. You don’t even have to travel to get it! This seems unsustainable.
The bigger question is how many cars can you build with 300,000 dollars a month?
Or paper bags?
Or elevators?
Or cell phones?
The Devil's Excrement 
June 12, 2010 at 1:31 pm
Gordo,
The opposition IS an alternative.DEMOCRACY IS an alternative.FREEDOM OF SPEECH IS an alternative…and I could go on forever.
General visions allow for adaptation and for integration of different ideas.Plans usually only include the planners( in the case of politics)
June 12, 2010 at 12:22 pm
A-Aaaaatonio,
don´t leave – you will miss the great show when Huguito FALL´S – thats the only reason I am still here – it´s a MUST to see and will be very, very REWARDING – trust me on this – it will be PARTY, PARTY and ENDLESS PARTY… when he cries like a little baby – THAN you will see that even the CaSTRO´s will push him to the gutter´s… an Diosmierda will say that he NEVER believed in him and Jordani will cry with him and look for a good rope….
DON´T GO – SOON IT WILL BE OVER….
June 12, 2010 at 11:59 am
Is there another way to prosperity than leaving the country?
I have family in other countries, that left the country, and after a few years of difficulties, the level of live achieved there is far away from they had here.
Think in solutions, put in practice or leave.
come on, no bady can not wait, I left…
June 12, 2010 at 11:20 am
Gordo, what solution YOU have in mind – I know a quick one….
June 12, 2010 at 10:53 am
I think it’s time for the opposition to propose solutions to el pueblo. The poor need an alternative!
June 12, 2010 at 9:59 am
“You can’t steal your way into prosperity.”
Sic Semper Socialismus
June 12, 2010 at 7:19 am
We have to admit that the repressive apparatus of this Regime have a good sense of timing.
That’s why they persecuted the president of Globovision and his son during the World Cup (his son, “because, sons and daughter have to pay for the sins of their parents” as Chavez said.
How many arbitrary and repressive acts will we see during the World Cup as “Smoke screen” ??
June 12, 2010 at 6:55 am
Breaking News! Not only is hoarding food and dollars in speculation bad for 21st century socialism, apparently hoarding Toyotas falls in the same category as Zuoaga is ordered arrested for doing so. Hoarding cars? Cono!
I’ve decided to return to Venezuela and get in on the ground floor of the burros franchise, as that’s all see on the road if Chavez has his way.
June 11, 2010 at 8:15 pm
“That means that the government will likely sell more dollar-denominated bonds, pushing the price of existing debt lower.”
Why buy something it its price is going lower?
June 11, 2010 at 6:51 pm
RE debt default: “A default, though unlikely, isn’t completely impossible: Inflation is already running around an annual rate of 30%, and the government has devalued the bolivar three times during its 11 years in power, most recently in January.
“You already have two factors that typically precede a default: one is FX instability and, two, a lack of dollar supply,” said HSBC’s Joshi.
The government’s dollar shortage–despite oil exports that bring in a regular flow of greenbacks–are behind its attempts to gain control of the currency markets. Yet JPMorgan debt strategists expect the shortage of dollars in the local economy to continue despite these efforts. That means that the government will likely sell more dollar-denominated bonds, pushing the price of existing debt lower.”
June 11, 2010 at 6:18 pm
you all must be so proud
http://www.cbsnews.com/8301-503544_162-20007462-503544.html?tag=contentMain;contentBody
June 11, 2010 at 3:58 pm
Quote today from petroleumworld.com:
Although he continues to enjoy the support of 50% of the population, he is creating an environment of class warfare—which could end up destroying the country. Such a scenario bodes poorly for bond holders, and any eventual debt restructuring will be ugly once the country destroys its productive assets. This, along with a major devaluation to above 10, would eventually lead to the collapse of the economy and the need to impose a massive haircut in order to stabilize the national accounts. Therefore, it’s time to sell everything in Venezuela and get out.
http://www.petroleumworld.com/issues10061001.htm
June 11, 2010 at 3:44 pm
OT: From friends in Anzoategui
PDVAL quietly burying at least 10 containers of spoiled milk on new construction site in Jose.
June 11, 2010 at 3:16 pm
The Chavis strategy: Increasing desperation leads to bolder lies. Bolder lies leads to suppression of the truth. Suppression of the truth leads to consolidation of power to monopolize information. Monopoly of information leads to absolute power. Absolute power leads to total freedom from accountability. Total freedom from accountability leads to reckless behavior. Reckless behavior leads to further desperation. Etc., etc. etc. etc. etc…..
June 11, 2010 at 1:23 pm
Robert you gotta remember Phylis Dillers definition of model…… as in Model Husband…… a small imitation of the real thing.
June 11, 2010 at 4:27 am
New this morning. Security regulator admits that the currency market is going to be modeled after China:
http://www.businessweek.com/news/2010-06-10/venezuela-won-t-burn-reserves-to-supply-market-update2-.html
June 10, 2010 at 10:24 pm
Well it sez right here http://news.yahoo.com/s/ap/20100611/ap_on_re_la_am_ca/lt_venezuela_electricity
the electric shortage is over. Enter shortage 2.0 with somebody else to blame?
June 10, 2010 at 5:53 pm
Electricity blackouts will strike all over the country, because the supply of energy is not solved and not it will be in the next years….Remember Chavez saying that in August 4.000 megawatts would be added to the electrical network? He announced yesterday , the supply of less than 1.000 megawatts mainly from small generating plants, located in small communities. This could be called ” the Mega LIE “.
June 10, 2010 at 4:52 pm
This was predictable. the masses would have rioted if the lights went out during games!
Come on England!
June 10, 2010 at 4:41 pm
We have to admit that Chavez knows how try to maintain votes and try to implant “no bread, but yes to circus”, he suspend the cuts of electricity, a day before the World Cup.
That is the high level of economical and political decisions of this regime.
Enjoy the World Cup !!!
June 10, 2010 at 1:42 pm
What do you mean?
June 10, 2010 at 1:07 pm
DIANUEVO – you are really a hell of a “thinker”.. .
Dios MIO
June 10, 2010 at 12:10 pm
Guys, this is another devaluation in disguise. I have a feeling that the travel/remittance/internet cupos are about to disappear and everyone will be getting their dollars at 5.4.
June 10, 2010 at 11:53 am
If Chavez could figure out a way to control it, he would claim that the AIR is the property of “el pueblo” and refuse to distribute it to anyone who doesn’t support him.
June 10, 2010 at 11:38 am
They’re saying today that the dollars belong to the pueblo and that not just anyone with an urge for dollars can have them.
It will be very interesting to see how bureaucratic the system becomes to weed out the oligarchs & all the others he has a hate for.
I’m just going to to sit on the fence until all this settles down. I’m registered with CADIVI & have various outside accounts however i really don’t want to give that info to the Cubans.
June 10, 2010 at 11:33 am
I doubt that any of the cocaine money goes into government accounts, only into the pockets and accounts of those in the government who are facilitating the trade, and I doubt any of those accounts are even in Venezuela.
Sort of off-topic, but I’ve thought for a while that Chavez should legalize the growing of industrial hemp. It’s an easy crop to grow, Venezuela has the perfect climate, and there is great demand for hemp fiber and hemp seed oil around the world. Best of all from his point of view is that it would really piss off the USA government.
June 10, 2010 at 11:22 am
Yep it is the travel allowance all over again.. There will be a lot of people making a lot of money out of this..
June 10, 2010 at 11:18 am
Thats what i meant by you dont even have to travel, everyone that has an account abroad will do it, that could ve billions of dollars like what what happened with travel allowances
June 10, 2010 at 10:59 am
There is however a little trick to make some money out of the new system. Every Venezuelan with an offshore account with a bank that is acknowledged by the BCV can use this account to receive $5.000,00 at an exchange rate of BsF 5.4. Once received one can easily sell their dollars on the black market at an exchange rate of BsF 9.7.
June 10, 2010 at 10:06 am
Please do not forget to add in the dollars from selling cocaine abroad.
This link has Venezuelans arrested in a massive billion dollar drug bust in Gambia. Do not believe that the Venezuelans were just fishing.
http://www1.voanews.com/english/news/africa/Gambian-Police-Make-Billion-Dollar-Drug-Bust-95966849.html
June 10, 2010 at 2:15 am
escuàlidos a hacer cola ya pues, cinco mil x year no es gran cosota, pero son casi regalados.
pero y pa’ què quieren màs?
cuerda de tracaleros, traigan para acà los trillones malhabidos que tienen afuera!!
June 10, 2010 at 12:22 am
MADOFF IS A “NENE DE PECHO” COMPARED TO CHAVEZ!!!! THIS IS THE BIGGEST PONZI SCHEME OUT THERE!!!!
Just think about it……
June 10, 2010 at 12:20 am
MADOFF IS A “NENE DE PECHO” COMPARED TO CHAVEZ!!!! THIS IS THE BIGGEST PONZI SCHEME OUT THERE!!!!
June 10, 2010 at 12:11 am
Nobody here has mentioned the great irony.
Either the government (including PDVSA) will have to supply the dollars or the dollars will have to come from selling the limited stock of dollar denominated bonds issued by the Bolivarian Government and sold at an enormous discount to foreigners for dollars.
What foreigner with dollars would take a flyer on Bolivarian dollars sold at a deep discount?
Why foreign speculators of course! The whole plan is based on the cooperation of foreign speculators!
June 9, 2010 at 11:59 pm
IMPROVISATION 101…………..The sad part is that it usually works for the THUGS!!!!!
June 9, 2010 at 11:58 pm
In several months, even more of a mess. The economy will further collapse from lack of access to dollars. An economy destroyed, with only the government left standing. While coercion cannot improve the economy, it can destroy private enterprise alternatives to government.
June 9, 2010 at 11:31 pm
As far as I know some banks got few operations today… many clients could get any… several barriers were put in place, RUSAD, Off shore bank accounts, etc…. for intance I couldnt get any from BBV. They told me that my company never have CADIVI operations with them, so, not allow… then I called the bank that i have Cadivis operations with, and they told me that as the company does not have a cuenta de corretaje activa with them, i have to wait till next week…
its kinda puzzled…But as usual, a tricky “criollo” kick off… third world…
Today I felt like when you go to a Registro mercantil to get some info… and you ended up more confused and lost with that usual rage… very third wordly….
June 9, 2010 at 11:31 pm
The whole thing is bizarre, the system as outlined makes no sense the more I read, the more I think these guys are brain dead. An excuse to take the banks?
June 9, 2010 at 11:18 pm
Don’t worry, this government doesn’t plan. It just obtains outcomes: Outcomes which bear only a coincidental relationship to its intentions.
June 9, 2010 at 8:25 pm
jz wrote:
I am wondering to if Chavez’s goal now is not to expropriate companies but instead to sap them of cash via fines.
Good point. Just bleed them dry until the businesses collapse or give up. How convenient to know that one can count on a guaranteed violation at any company that does more than $300,000 a month in imports. Such as Polar. Of course, Thugo already said that Polar would not be getting any dollars, so if they import anything they will be getting the dollars illegally.
It’s time for people to realize that this isn’t about incompetence and stupidity, it is about destroying any possibility of opposition to a total dictatorship. The goal and plan is for all Venezuelans to be serfs living in poverty and dependent on the whims of one psychopath for their daily bread, e.g. Cuba.
I don’t think things will turn out that way, but I clearly see it as the plan.
June 9, 2010 at 8:24 pm
I just thought about the question I posed above. Sorry for the stupidity. The question assumes someone would have a need for worthless bolivars. My bad! Other than oil, does the country produce anything and I mean anything (legal, of course) that could have value as an export. For example, red t-shirts.
June 9, 2010 at 8:19 pm
June 2, 2010 at 2:42 pm
Let’s see,,,,,take control of resources, eliminate private sector production thru monetary policy, feed the masses that swear allegiance to the fat man. 2012 should be very interesting.
My earlier post seems more relevant by the minute! One question Miguel, can people buy other currencies and then convert them to dollars. For example, buy Argentina paper and then convert it to U.S. dollars or are there mechanisms in place to prevent such a strategy?
June 9, 2010 at 5:10 pm
Imagine if they do17 million on a day that nobody was ready, how much people will ask once it gets oiled!!!!
June 9, 2010 at 4:35 pm
My last comment not even is already cold. When I read a new that the ex-chief of antidrug division of the technical police (CIPPC), between 2004 and 2007, is arrested in Andorra because he try to clean one million dollars.
That is the quality of the nomenclature of this regime.
June 9, 2010 at 4:11 pm
Back in 2003 Roberto Rigobon “guaranteed” that the currency regime would not last three months. It may be that the regime outlasted his prediction simply because it had a “pressure valve” component that adjusted to the market. Things are different this time.
June 9, 2010 at 4:06 pm
Question to all:
Does anybody know ANYONE that was able to buy dollars today at 5.30. I called every bank I know and they had no operations today and yet they are claiming 17 million transacted at 5.30. Reallly? Who bought? what bank? what guidelines? Really!
June 9, 2010 at 4:02 pm
Question?
What are the commissions on these transactions, I thought they were supposed to be posted?
June 9, 2010 at 3:41 pm
Question is: will the central bank intervene to sell dollar when the upper limit of the band is being pressured? Today 90% of orders were near the limit at 5,30
June 9, 2010 at 3:18 pm
Is this deja vu all over again? Remember when people were being recruited to get their annual dollar limits to facilitate the arbitrage? Everyone made money and everyone was happy? Here we go again.
June 9, 2010 at 2:26 pm
m_astera: I agree that could be the plan, or part of the plan (“Probably the point is the destruction of the private sector..” Not buying $$$ at the officiela rate could be used by the government to expropiate their business).
George: as much as I wish that what you said (…” because Chavez & Co. are broke, lost and soon on the run”) be true, I don’t think they’re quite broke, not quite lost (yet, perhaps) and I don’t think they’ll be on the run anytime soon. Again, I get stomach ache just by writing this, since I’d really like that what you said to be true.
June 9, 2010 at 1:50 pm
This Regime is a froud, the buy companies with others people money.
The property of the companies is clear. Chavez and his nomenclature.
This nomenclature will use the new system to clean cheap their money.
June 9, 2010 at 1:33 pm
Or is it a way of logging and tracking who has an offshore dollar account???
If it sounds too good to be true……….
June 9, 2010 at 1:27 pm
I agree M-Astera. I don’t for a second buy that Chavez is going to hand out $5000 per person at the 5.4 rate to all comers. He may give it to a few folks, but Chavez can’t give out that kind of money. Their cash reserves are falling too fast.
I am wondering to if Chavez’s goal now is not to expropriate companies but instead to sap them of cash via fines.
Whatever it is, Chavez has done a number on the bond market. As of now, the 2034 bonds have tumbled to 55 and are yielding 17%.
With Europe crumbling and Americans hating him, Chavez’s ability to borrow money is looking pretty bleak here.
The U.S. and Japan can borrow money at 0 to 2% from the world bond markets, and you have to pay 17% because you are such a crummy credit risk? Wake up and smell the coffee, Chavez, you dumb ass. You can’t steal your way into prosperity.
June 9, 2010 at 12:47 pm
So now we’ll get the whole “selling of cupos”, all over again.
June 9, 2010 at 12:47 pm
It is not illegal to have an account. In fact, if you don’t , you can not participate in this market. It is so cheap that people will line up, if tge old 5k travel allowance used to consume 4-5 billion and you had to travel for the cheap dollars, imagine this where all you need is a cedula and a $ bank account.
June 9, 2010 at 12:29 pm
including all of the regime! They don’t trust themself to be competent with the economy as they know they’re not.
Would be good to get feedback from any readers of this blog that try applying for these dollars!
June 9, 2010 at 12:25 pm
Gordo I don’t believe having an offshore account is illegal.
Many Venezuelans have this.
June 9, 2010 at 12:22 pm
40 million dollars a day and 260 working days a year. Chavez can serve 35000 companies OR 2 million persons. Thats not enough!
June 9, 2010 at 12:18 pm
Isn’t it illegal to have an off-shore account?
Isn’t it a good idea to buy dollars if you are an individual?
If ordinary citizens start buying dollars, is that going to crowd out dollars needed by private companies?
If high inflation continues, won’t Venezuelans want to hold dollars?
Isn’t that anti-productive?
If shortages continue, won’t individuals spend Bolivars in order to hoard food, consumables, etc.? Wont all these activities aggravate shortages and add to inflation?
Isn’t the government speculating that speculation is the problem?
June 9, 2010 at 12:10 pm
The real question – What happens to CADIVI during all this??
Does it continue giving out US$ at $4,3 or 2,6??
What about travel allowances??
If an individual buys $5000 at 5,4 does he get it in cash or does the bank have to transfer it to your offshore account?
What stops that individual from just transferring it back to another offshore account of a business that needs $$ & getting 9+ or whatever in Bs.
The corruption is going to skyrocket.
Many questions??
June 9, 2010 at 12:01 pm
Good Day,
yes it will go to 15 to 20 bees per buck and still will be a “regalo” (gift)
because Chavez & Co. are broke, lost and soon on the run !
June 9, 2010 at 12:00 pm
Obviously that can’t and won’t work, so let’s assume it’s not supposed to work. Let’s also assume the fat boy’s Cuban advisors know it won’t work. So what’s the point?
Probably the point is the destruction of the private sector. In order to stay in business, the owners will have to buy dollars on the black market, which is illegal, and when they can’t prove they had a legal source for the dollars their businesses will be expropriated.
June 9, 2010 at 11:56 am
They will sell 40 million a day. While the market demands 80 million a day?
June 9, 2010 at 11:46 am
Wow max 300k for a company, black market will go nuts, these guys are total absolute morons. wow just Wow.