It’s easy to be concerned about Iris Varela being Minister for Prisons, what she says is easy to understand and as Quico says very dangerous. But in part, it is because the extreme nature of her statements is so non-sensical and in language easy to understand that makes her her now infamous statements shocking:
1) 40% of the prison populations should legally be out in the streets.
2) If a Judge does not release a prisoner, I call the President of the Supreme Court.
3) Ordered that no new prisoners be admitted in any jail in Venezuela.
All three of these violate the rule of law, common sense and are easy to understand by anyone who has some inkling as to how societies function.
But is Ms. Varela any more dangerous than Jorge Giordani who has been the “economic” brain of the revolution since 1998? (Minister of Planning 1998-2002, Central Bank Board member 2001-today, Minister of Planning 2004-today, Minister of Finance 2010-today, member of the Board of PDVSA 2011-)
Take for example what Giordani said after issuing the recent Global 2031 bond:
-We are removing Bs. 18 billion from the liquidity or 40% of it. (This is supposed to be one of the “good” things of issuing the bond)
First, it is 40% of excess liquidity, not liquidity, the latter stands at Bs. 354 billion. In fact, liquidity (M2, the amount of money in circulation) has gone up by 17% so far in 2011 (or has been allowed to increase by that much), which is the main cause for inflation. But even worse, Bs. 18 billion takes total liquidity back to what was present in the system on June 15th., only six weeks ago. That is, the amount of liquidity that this US$ 4.2 billion (!) bond removes from the economy just takes us back six weeks to the money created by this Government. Wouldn’t have been easier not to print that money?
But Giordani does not seem to understand the role of liquidity in the system. When Chavez got to power, there were some Bs. F. 10 billion in circulation. Today there are Bs. F. 350 billion in circulation. This is Giordani’s Baby, one way or the other he has been around at each step of this monstrous creation of money.
Now, just so you get an idea, the Venezuelan economy in those same twelve years that Chavez has been in power has grown a total of 31.4% in real terms, but the amount of Bolivars out in the streets has gone up by 3,900% in absolute terms. Do you see the problem? It’s the new money creating the inflation, too many new Bolivars chasing just 31% more goods. It is not a chicken and egg problem, you control the number of Bolivars, you control inflation. Ask Paul Volcker, who stopped inflation cold in the US in the early 80’s.
In fact, let’s compare it to the US during the same period. GDP in the US has increased by 35%, slightly more than Venezuela, but monetary liquidity has increased by only a factor of 2, or 100%. And you probably have heard about the “problem” in the US with all that new money that was thrown around in QE1 and QE2 to stimulate the economy. Well, Giordani has done a factor of 35 more in money printing, thus the lower inflation in the US. But note, Venezuela had its main product for export, oil, increase by a factor of 10 in price during that period, and the US economy managed to grow more in that period, despite the fact that there was a huge financial and housing crisis.
So much for capitalism being dead, Hugo!
And to complete Giordani’s trifecta of danger, there is the infamous “excess” international reserves concept, in which every year “excess” US$ in the Central Bank (as defined by the Government) are transferred to Chavez’ petty cash fund the Fonden. So far, US$ 67 billion have been transferred out of the reserves.
In 1998 when Chavez got to power, there were US$ 14.2 billion in international reserves. Oil was around US$ 12 per barrel.
Today? Today there are US$ 29.2 billion in reserves, but oil is topping U$90-100 per barrel.
Put another way, in 1998 there were Bs. 0.53 for each dollar in the Central Bank in international reserves and the exchange rate was Bs. 0.574 per US$. If all Bs. were converted into dollars, there would still be dollars in the Central Bank.
Today there are Bs. 12.12 per US$, but the exchange rate is Bs. 4.3 per US$. If all Bs. were converted into $, the reserves would be wiped out and there would still be almost Bs. 240 billion around.
But imagine if the US$ 67 billion transferred to Fonden were part of the Central Bank’s reserves. Venezuela would have US$ 97 billion in reserves or there would be Bs. 3.4 per US$ in reserves, if all Bs. were converted to $, there would be plenty of dollars left.
Thus, Giordani has been in charge of a no-growth, inflationary economy for twelve years and at every step it has been his policy making that has screwed up things.
Amazingly, he is still in charge! And very dangerous!
What would you prefer twelve years of Iris with the crime rate doubling or tripling again or another 1,200% of inflation?
You Pick!
The Devil's Excrement 
August 14, 2011 at 4:01 pm
I am an analysts of bonds, people ask for my opinion. They don’t ask for politics, they ask for numbers and numbers wise, no matter what, Venezuela can pay US$ 4.4 billion a year easily, very easily. The country has no bonds maturing in the rest of 2011, no bonds maturing in 2012. This may end next in 2013, I will have to run numbers again then or if oil goes down in price. In fact, I look at them everyday, I evaluate every day. Whether the economy is being run to the ground or not is not relevant yet, Venezuela is selling and exporting oil and that is what generates the payments. Argentina had a much larger debt and could not keep up so it defaulted, Russia did not have much debt and decided to default anyway. Those events are much harder to predict. But strictly on numbers today, there is no danger of default because of lack of funds.
Politically that is another matter, I see no advantage to Chavez defaulting before 2013, after that is another matter, and that is what I tell foreign investors that ask my opinion. Today in fact, many investors are betting there will be change in Venezuela, they are playing the future, not even the present.
In 2007 I would tell them it was not worth it, they were not getting paid enough for the risk, today they are.
August 14, 2011 at 2:03 pm
Hi, mix or not to mix, that is the dilemma!!.
I found double standards everywhere. Many non-chavists, ferals oppositors, buy Venezuelan “yield” (I prefer “junks”), although I recognize yield sounds nicer. It means that there are who are “helping” Chavez to “finance” this disaster, other refuse to buy these bonds because they do not want to contribute with the disaster. There are people which successfully defend his bonds purchases , there is an ethical reason which ask me to “maximize” my income, particularly when my wealth comes from my honest human effort. Having say that, I think there is no need to justify my Venezuelan bond‘s purchases showing an “antichavist background”, it does not make any sense, to me.
There are double standards, for instance in evaluating Chavez ability to pay, particularly since Chavez “defaulted” several contracts, legal and constitutionally, national and international companies, cement, oil, expropriated and ruined many others, indeed he did not pay the compensations for several expropriations, even though it is illegal, he did not to paid it. I recall that this “default” makes about 30 Billion USD, O know it a kind of “contingent debt”, but some of these are going to be documented, very soon.
I do not understand you remark that he will be able to pay interest and capital due for the public debt. How not to understand double standards here too?. Believe me Octavio I fail do discriminate his “policies”. You remain me about “his ability to pay”, off course unless the oil prices fall, oil export revenues make 96% of exports. Sorry, I do not get it; I really failed to understand this statement. He pays this, he might not pay that, and so on, it looks to me very curious!!.
I swear that I am not able to predict these Chavez “unexpected financial behavior” paying some and not paying others. I understand that from a financial –read wealth- point of view I have to put some rationale on my trading’s decisions, otherwise will be very difficult to understand that I charge for the risk I take when buying something risky, and that I charge more the higher the risk. In other words, my “exuberance” requires from me to charge accordingly. We have to be carefully, some of those new “redivivos” Keynesians monks are hunting the “animal spirits” of “these irrational exuberants”. (Greenspan, before and latter ,Schiller have imposed this construct jejejeje, Krugman an Stiglitz are too behind them, because those investor have to buy GM, GE,IBM,Ford,Ch, an so on).
When people buy Venezuela sovereigns bonds, (even PDVSA ones, I will add some particular comments on this latter) they, and accordingly with your statement, belongs to this particular market. No matter what they know that Chavez had the ability or not to pay and that Venezuela has a lot to lose in case of default. We alert that countries are sovereigns that are they do not go to bankruptcy; they last to pays; at the end politicians find their way to pay what they think has to be paid, just. They now too that the international community regards banks as the devil , the bad, so bankers and “exuberant investors” lose money, which not always is theirs, belongs to other investors with larger asymmetry regarding knowledge. I remember that Argentina did have this ability during long 20 years. However, some day, 540 congresantes, all in one go, with their hands up –both- in the Argentinian Congreso decided to default, that history has did not end yet. Island did something similar, people vote massive not to payback debt, I know, they reverted it after all, but not make mistake, lot of “exuberant investors” lost money.
Pdvsa bonds. You might agree with me Octavio; not too many “exuberant investors” have read the Ley de Hidrocarburos 2001, as well as the articles related to oil, state, republic and PDVSA from 2000 Constitution. PDVSA Octavio, does not own nothing, just refineries, which is very bad business by the way, and some other installations, vessels, pipelines, chatarra, PDVSA does not own “oil reserves”, these belongs to Republic (accordingly with the 301/302/303 articles from 2000 Constitution). These rights are transferred to State and PDVSA; that is, PDVSA being a State body is s only a fiscal operator. So there are not laws with enforce PDVSA to accomplish with Trade Coding, as “sociedad anonima”.
I like this “tramparece Octavio…jejeje. However, “exuberant investors” buy PDVSA bonds with the hope if something happens they could go to some oil installations abroad, etc. etc. They are wrong; they have to read the laws and Constitution. With Constitution in his hands Chavez and Ramirez “defaulted” to accomplish the oils contracts from “asociaciones estrategicas y convenios operativos”, using your words they did not have the “ability” to accomplish these contracts. Our new constitution says, something very simple: NO.
I am not saying that PDVSA/Government will default “documented” debt (bonds). The worst scenery is a refinancing, if anything happens (you call this if prices oil fall), “exuberant investors will lose a little bit, not all, and having gaining the big rates of interest that the debt is paying, at the end of the history, some compensations has occurred.
I do not agree with you that the Giordani and Ramirez’s lies are to be blamed for the high yield, Ocativo, they are running an economy with a lot of “exuberance” too, and they think that the sky is the only limit for the indebtedness. The high risk Venezuela is showing Octavio, is not for these lies, I have been trained and hold a license for measuring risk, to qualify it, I can tell you that the Venezuelan risk, belong to the real numbers of the economy, and not only those coming from the macro sphere, but from the microeconomics, institutions, no rules at all, and particularly the health of PDVSA, the risk does not comes from the Chavez, Giordani, Ramires’s lies. They come from the ability to produce oil, expend it wisely and pay the debt. My ethics does not allow me to give details.
August 14, 2011 at 9:32 pm
Um, with respect, Alexander Guerrero: the blog owners’ name is MIGUEL, and his surname is Octavio. FYI…Oh, and thanks so much for your information. Please, go above and beyond what your “ethics” say you should do. After all, the whole world is wondering about it!!!
August 16, 2011 at 5:15 am
Well, I do not get it. What I call double standard is, in some respect, the lack of consistency in the analysis, and accordingly with my opinion runs as follow. Chavez is (un)able to pay for some debts (it does not matter if it is contingent documented, or not); and at the same time he is prepared to pay for other debts. I am not prepared to suck down that. This kind of “auto-accomplish prophecy” (he will pay this and will not pay that) will take me to divert my risk assessment about default, by discriminating and structuring risks in order to assess them.
I think I did not totally explain myself about the ethics issue. Let me express it again. People knowing that is financing Chavez disaster buying Venezuelan debt, but is at the same time forced by the “ethics” of maximizing his income, it does not matter what, as long is legal, and buying those bonds, is totally legal. I am not considering this to be a dilemma; I do not like them, since dilemmas do not have optimal solution.
I hope everything is now a little bit clear.
August 12, 2011 at 7:14 pm
Alexander: I try not to mix the questions. What Chavez is doing is irresponsible, corrupt, used in many ways for Government cronies to make money, unsustainable and stupid. I was the first one to note here how Argentinean bonds were being used by the Government and intermediaries to make not millions, but billions for themselves. Andlater the “emisiones”
On the other hand, while the path is unsustainable, Venezuela’s ability to pay is not in question…
yet!
Yearly payments of interest are quite doable within the country’s fiscal picture. Unless oil prices fall, Venezuela should not have a problem paying the US$ 4.4 billion a year plus easy maturities in 2013, reasonable in 2014, easy in 2015 and easy in 2016.
In fact, I contend that Venezuela should be yielding much less than it is, except for the act that Giordani is Minister of Finance and Ramirez is President of PDVSA. If they spoke to the markets and did not lie, yields could be 4 to 5% lower.
In the end, the decision to default is political, but it is not worth for Hugo Chavez to default yet, payments are easy in the scope of things.
The problems is that you can not continue issuing at the current rate, unless oil prices go up dramatically. The crossover may be three years or so away, it is just a matter of watching oil prices and payment schedules.
August 14, 2011 at 3:24 pm
I have forgot to remark that in theory –that is in the long term- you have to generate the funds (flows) to payback interests and principal (amortization, if any). This brings rationality to the economy, to the “country” balances. In other words, and to put it simple, in the last 12 quarters Venezuela economy did , not generated the flows (income) to serve the debt (interest payments), however Chavez paid some and “refi” some. The economy shows negative growth from the IV quarter 2008 up to now. Accordingly with theory, we are in an explosive fiscal position (simple algebra using differentials demonstrate this). The history says that Venezuelan paid, and will pay, but if oil prices fall (your assumptions) anything could happen. However, if you divide (stock)debt/GDP, you will find, like Giordani and Ramirez that there is still room for more debt, but this relationship comes by dividing a stock (debt) by a flow (year GDP). It becomes a little puzzled to follow for how long Venezuelan economy could support this trend, we do not have the fiscal rule, as Mr. Obama had it, and we are in that regard closer to Papandreou. Risk agencies in the world knows that, I. as economist, still receive invitations from these agencies to assess my opinion regarding the economy numbers, most of them are looking for some self- accomplished prophecies, Politicians, Octavio, do not like to adjust government expenditure since they, like poor people live from it.
AG
August 10, 2011 at 6:48 pm
…here we go again!
Ira nice comment, please dont get me wrong, you would be totally right if we were facing democratic, fair elections.
Now, do you think the opposition will win because of a good platform, and strong campaign, and the incumbent is going to transsfer power constitutionally?
Think again.
August 11, 2011 at 9:58 am
Sadly, I couldn’t agree more. I honestly believe “the results” are
already in some computer -waiting…
Just like in Honduras.
August 11, 2011 at 9:59 am
Why don’t Venezuelans express outrage
at Chavez’s meddling inthe affairs- trying to
disrupt and threatening other countries?
August 10, 2011 at 5:01 pm
If the opposition is going to focus on economic figures, they’re doomed. They have to focus on the simple idiocy which is the basic premise of this piece, and what she said.
Bush Sr. won on three stupid words–“No new taxes.” But he raised taxes, and lost reelection.
The VZ opposition, whoever they may be, can’t campaign on Chavez’s myriad of failures. There are too way many to list, and too many details for people to digest and understand.
Opposition victory is going to revolve around a few issues, and to me, the main one that both borderline Chavistas and anti-Chavistas totally understand is Cuba’s disturbing administration and involvement in the affairs of the sovereign nation Venezuela:
A Chavista can’t in any good conscience claim to be a patriotic Venezuelan, when Chavez’s orders come from Havana.
August 11, 2011 at 9:54 am
Yes- I think Clueless in Caracas -you have arrived at
precisely the arguement “they”-chavistas/Chavez are using-
ie.Chavez and chavistas believe “el pueblo” are
uneducated- and guiltless. However, middle-class and elites
are all guilty of being brainwashed by the empire-etc
therefore-even mom and pop -small businesses-small farmers
must be eradicated-retrained-replaced by for example- cuban-style
farmers, any style except yanqui style- even Mugabe style-
For example- the housing project -built by Iranians -of course
do not promote local businesses in Venezuela- that would be
businesses under the old system of capitalism..
So-in a sense- you are “carrying water” for Chavez-
Of course,Chavez will not come out and say
el pueblo is stupid- no, but he does say -businesses
and rich are stupid- and it is the same as
Obama supporters calling anyone who opposes anything
“racist”. ..
August 10, 2011 at 12:16 pm
in this case, the story goes: it was the worse of times, it was the worse of times
August 10, 2011 at 9:15 am
The problem is not Giordani, but as usual Chávez: he sees himself as economist, educator, engineer, social scientist, historian and much more. He thinks he is only delegating on others the “details” but those others he selects based on how subservient they are towards him.
August 10, 2011 at 8:42 am
Another boring comment thread that Kepler hijacks with his insults to another and straw-man tactics .
CharlesC has a right to his opinion without Kepler’s abuse.
The others who do not stand up to the bullying and speak out, need to make their parallel with what is happening in Venezuela today.
After insulting and misinterpreting Charles C, Kepler goes straight to appear very friendly with the blog owner.
If Kepler cannot win an argument without this abuse, then he must refrain, because this is NOT what debate is all about.
PS, Kepler: It is not lost on me the intention of your tactic.When you misquote others and attribute implications that are not there, unless folks read and pay attention to the entire thread, some will come away with the impression that the person targeted by your anger has said something atrocious.
August 10, 2011 at 9:12 am
Firepigette,
That guy is saying Obama equals Chávez and both are Muslim AND Communist. That is absolutely ridiculous. One does not need to prove that. Anyone with some basic education knows the meaning of communism and of Islam.
Tactics your foot. I comment on the thread and on his use of the thread to discuss his frustrations about Obama.
You don’t tell me what I must. Go tell that yourself.
August 10, 2011 at 5:56 am
It is not too easy, oil dollars -and there are sometimes plenty of them- tends to appreciate currency (Bs) even when fixed and controlled. To elimante these distorsions -relative prices- we sugggested few years ago to replace the bolivar with dollar, it looks crazy, but it is the only way out to our fiscal madness (!??) and to increase by a lot investment rate (anyone). You know, we do not respect rules, we bend them, or like Chavez throw away, the beauty is that we can not print dollars. But we lost the “debate”. In this rent seekers society, you know (nosotros cocinamos habas en cada rincon del pais)
August 10, 2011 at 5:49 am
It might be even less, remember BCV sold 4200 US to finance peoples ‘bonds31 purchases, of what 1500 goes back to BCV, 1000 to capitalize public financial institutions, and the reminder to people. It could be that about 2000 find its way back to BCV in the following weeks.
Oil prices drop in the last days has changed government expenditure plans, the outlook is bad, unless they adjust expenditures, but remember they expend dollars, more than three quarter of CADIVI dollars (4.3 Bs/$) go for government agencies including PDVSA.
Government is today the largest food/row materials for food industry importer, it looks trapped, I do not observe a good way out from this financial trap. Well, we know, they have BCV and FONDEN (no balance here, but there are not too many dollars here).
What government has is lot is hard powered money coming from BCV printers, and of course, only inflation pays for this hard currency. The will go this way, people lives with money illusion, and Venezuelans are us to it, even though lots of them keep a good amount of dollars somewhere else…..
August 10, 2011 at 10:07 pm
Alexander,
1. As far as I understand BCV did not sell 4200 MMUS$ to finance Bonds 31. The country is just issuing long bonds in US$ and did receive bolivares from buyers right now.
2.I suppose state banks had enough funds to pay assigned bonds 31 by tapping government deposits, paper swaps, window from BCV, etc.
Once banks will sold Bonds31 in SITME auctions, they will get back the bolivares to refill deposits and clear BCV swaps. No stress.
3. Only 500 Millions US$ were moved to FONDEN from BCV this week. I assume these dollars will be used to buy and support declining venezuelan bonds price offshore (and relevant SITME parity).
This last transfer from BCV to FONDEN suggests there are not enough hidden funds in FONDEN… but this is just a personal idea, nobody know.
BTW… latest import certificates (NO PRODUCCION) required by CADIVI are being cut to a fraction. Now you ask an amount and you are approved a 10-12%..no more. We used to receive a 60-70% ratio just a few months ago. The outlook is a stronger and harder currency shortage.
August 12, 2011 at 6:24 am
No Carlo, long time ago, when the government activated the dollar “permuta” it did that in order to redirect international reserves at BCV to Treasury. The bonds issues are easily sold since Venezuelans run quickly behind them in order to acquire dollars. The “purchase” occurs in an apparent way; you deliver your bolivares to the banks, these delivers to BCV, and BCV deliver the dollars to Treasury, everything happens in one go. I am sure you might remember to listen Giordani or Merentes when they say, anytime there is an bond issue like the last one, that BCV withdrew some amount of bolivars from the money supply and so on, they are right, since BCV sterilizes the money supply when sell these dollars to purchase treasury bonds. In a way, BCV acts as the Treasury left hand, like in China, for instance. This time, BCV received 1000 US from that bonds issue, governments banks 1500 of these bond to recapitalize Banco Bicentenario and others banks (this is really TRUE, believe me, I know). You might note now why people got not more than 6000 USD. That is the reason why Octavio who likes “yield’ bonds did not say anything about it!!….jejejeje The Bond 31 was mainly for public sector including BCV, I guess, liquidity reasons. In October comes another one. By the way, yesterday SITME traded only 30 M USD.
August 12, 2011 at 7:21 am
I dont understand what you mean, but yes, I own even Kodak bonds, and they are closer to default than Venezuela/PDVSA, the timing is the key.
August 12, 2011 at 5:22 pm
There is nothing there to understand Octavio, I did not mean anything, I have just remarked, what you wrote here few days ago, that you like “yield” bonds. I did not ask about that, so I have not qualified them.
I do not know which one is closer to default, Kodak or PDVSA/government bonds, if the default definition –the narrow one- is the one regarded to cease interest and/or principal payments on treasurers, sovereign bonds, in particular.
However, in general, Chavez has defaulted many times; -let us call it- “gross default”, if you like. He has “defaulted” (you can take away the quotation marks) as well other obligations, he had violated contracts, even agreement which are protected by his own constitution, and because of that, he is facing important claims (oil, cement, land, sugar, meat, etc. etc., etc.) which could be very costly for Venezuelans. You know, by default, I am obliged to consider a broad definition. Anyone that buys sovereign and PDVSA bonds could sit on them to “maturity” or sell them for cash whenever he wants. The spread between the 5.3 Bs/$ and the “free arbitrage mark” is about 75%, so the buyer has in theory plenty of time to think about, what to do.
Lot of governments associated PEP and FEP, partners, etc. etc., have the ability to buy these bonds and hold them until de end of the history. I remember what happens in Russia when Yeltsin declared the fiscal crises in 1991, the one which provoked massive selling of government corporations in oil, gas, gold, banks, even weapon industry, etc., etc.,. Everybody knows that the communist leadership during decades accumulated huge savings abroad; they eventually repatriated these funds to purchases these corporations sold for one ruble for share that is to buy “golilla”. I do not know, but we can have two remakes of such history: Cuba and Venezuela, which all means coming from oil.
August 9, 2011 at 8:30 pm
He has become a sad parody, he really believes ta=hat Venezuelns have health and education now? He is really out of touch, 60-plus % of all Barrio Adentro modules are shut down and desertion ahs never been so high. What a fools he is!
August 9, 2011 at 6:57 pm
Did you see the Giordani interview that appears today in N24. Good lord! I am a physician, but I know something about economics. They guy was deriding the American economy, saying that its problems are structural! Even I can readily tell that this guy is no economist!
August 9, 2011 at 9:00 pm
GIordani is not an economist, he is electric engineer, but in any case, economics is just human action, sometimes a degree is needed, but sometimes not, but what is necessary is to dispose of a good amount of common sense. Giordani lack of it.
August 9, 2011 at 9:06 pm
The problem is he thinks he knows economics. I am not an economist, I would not dare to establish economic policy in Venezuela. Leasr of all defend failure.
August 10, 2011 at 4:54 pm
Exactly. Even if by undergraduate training he is not an economist, he could have done masters and PhD studies in the discipline, and thus have the credentials to be FINANCE or PLANNING minister. He did not undertake those studies, of course. But, you should have some serious knowledge about economics if you are to be a minister in charge of that area. In the interview, he displayed utter ignorance about economic issues, with the conviction that he knows a lot about them. Poor country. It is going to take decades to build something viable.
August 10, 2011 at 5:02 pm
He has a Ph.D. in Urban Planning, i undersatnd his projects were always turned down at the World abnk because of the terrible economic projections.
August 10, 2011 at 6:08 pm
Sorry, I can quite understand what you mean. What has urban planning have to do with managing an economy? The Secretary of the Treasury isn’t an urban planner. Last I checked he has the credentials needed for his job.
August 9, 2011 at 3:59 pm
Nah, Miguel those two are too easy.
Pick a harder target!
It’s like putting down a young-earther, and then a flat-earther…
Oh, you mean something else… The creationist is in charge of health care, epidemiology and disease control / food , fisheries and agriculture? And the flat-earther is in charge of transportation dept. / geology and geodesy?
It’s going to hurt, definitely.
August 9, 2011 at 3:53 pm
Miguel,
Look at this:
http://el-carabobeno.com/portada/articulo/18531/gobierno-nacional-toma-medidas-contra-ineficacia-ante-crisis
These guys are really like a bad version of that Woody Allen film about the banana republic: they will blame anything that happens in Venezuela on “the final crisis of capitalism”…
That is such a wally!
August 9, 2011 at 3:48 pm
Ask him something very simple, how he will define a communist
August 9, 2011 at 3:16 pm
Your cultural background is close to zero. Ouch.
Truthfully- how much “anthropology”
or education does one have to say achieve
a 1 – or god forbid a 2 on your &*^*&^ graph, pal?
What do you call it when you vomit on
yourself? A revelation -I suppose…
August 10, 2011 at 7:06 am
I woke up this morning and said-Aah-ha!
I’ve got it! He’s talking about “bacteria” -duh
.http://www.youtube.com/watch?v=j3xPnEPNgZ8
August 9, 2011 at 2:38 pm
Chavez and chavistas-favorite activity bragging about what they
have accomplished and boasting about what they are going to do
in the “victorious” future and AND – taunting, lying about, name calling
insulting the “opposition’-point is even when some brave little opposition
makes a point- graphs, facts – he/she is immediately mischaracterized
and for example-aw- they are just a mouthpiece for the yanqui empire–blah,blah, blah. – and Venezeulan people never seem to “learn” the
truth- for example 2.2 billion borrowed from Russia in 2010- ask
any Venezuelan- why? Can you how that improved the economy
of Venezuela-NO.
August 10, 2011 at 7:01 am
The point is- there is no auditor, no oversight, no review.
After this amount of time- what is here on the ground-
working in Venezuela-just a summary of how this
2.2 billion =manifested itself -if and where it did..
THis is just one example- and finally- who
decided to borrow the 2.2 billion- was it Chavez alone
and what are the terms of repayment-are
payments being made- for how long?
How is that money being accounted for?
August 9, 2011 at 2:31 pm
Is there a way of calculating accumulated inflation for the entire Chavez period? How would it compare with other Latin American countries during the same period?
August 9, 2011 at 3:37 pm
Let me give you a better proxy than “inflation”. I the last 10 years we are in real pain to measure inflation, price regulation, data massage, and some CB of “nuclear” inflation, even a change in price methodology have distorted relative prices. However, if you consider the exchange rate, you will get what you do not want. In February 1999, exchange rate was 547 Bs/USD (0.547), today you have only one rate, the official, 4,300 Bs/USD (4.3). You might find some kind of arbitrages for the price of one dollar, SITME, about 5,300 Bs/USD (5.3) and what people call parallel o free market, (but these are not exchange rates as the books explains) )at 8,500 Bs/USD (8.5). Do the homework and find yourself the answer for your question. Figures in parenthesis are indexed by 1000, after Chavez premultiplied by 1/1000.
Chears
AG
August 10, 2011 at 3:29 am
Hey thanks Alexander. So if I use 4,3BsF/US$ I get 686% in 12 years. With 8,5BsF/US$ I get 1454%. I think the real number is in between and a bit closer to 1454%.
August 9, 2011 at 8:09 am
August 9, 2011 at 8:03 am
Until Venezuela gets rid of Chavez -the economy has no chance.It will be driven further into the ground. And, getting rid of Chavez hopefully would cause many of his henchmen to run away. (They should be caught and brought to Court- as Alek Boyd says.)
Anyway- a “sea change” is required now in Venezuela.
August 9, 2011 at 7:07 am
OT
A Spanish company has just announced the construction of 3,264 houses in Santa Teresa de Tuy for $181,000,000.
That works out to $55,500 per house.
http://www.lapatilla.com/site/2011/08/09/grupo-espanol-construira-casas-en-santa-teresa-del-tuy-por-181-millones-de-dolares/
How come it’s costing the Iranians $100,000 per house? Dumb question! There’s more guiso in the Iranian deal.
August 9, 2011 at 7:53 am
Question: How many mosques are being built in Venezuela right now?
Have you ever wondered why Chavez calls
these Moslems-“brothers”?
Hint-Moslems call each other “brother”..
August 9, 2011 at 11:35 am
No, Armano, No! Todos los Arabes usamos ese termino!
August 9, 2011 at 12:08 pm
No somos árabes. Decimos al hermano-hermano. De todas formas Chavez – para ejemplo-dio a reproducción de la espada de Bolivar y proclamada ” de Quadaffi; hermano” en de la spirita de Bolivar…
August 9, 2011 at 12:14 pm
Verga, Charles…where are you living? Do you think Obama is Muslim as well? Or Marxist AND Muslim?
August 9, 2011 at 1:16 pm
I’m in Florida now-
Not safe for me in Venezuela.Much concern for family, friends and
have some business w/Venezuela.(Can’t get anything going these days)
It is a fact- Obama was a Muslim- he seems rather chamelion-like..
Yes -he has lots of Marxist training too
This I know. What I think-he is a total failure. Not
like Chavez- I don’t see any comparisons.
y verga a ud, tambien
August 9, 2011 at 1:28 pm
Actually- that is one thing both Chavez andObama are
very much the same- love of Moslems -and appointing
them to positions in their governments,giving large
sums of money to Moslems…
August 10, 2011 at 9:57 pm
CharlesC: please tell me where you drank the KoolAid, so I don´t go there. You DON´T know squat. All you know is what you read on the extreme right wing nut sites. Sheesh – and all along, I thought that people who read this blog were educated. I guess that’s what I get for thinking. VERGACIÓN!!!
OK, /rant. Still pissed, though…
August 9, 2011 at 2:24 pm
Charles,
Your cultural background is close to zero.
A Muslim cannot be a communist and vice versa, as simple as that. And you don’t even know what a communist is. Take a book or two. Try to watch news from outside the States, preferably not Italy or Zimbabwe. Try Dutch news, French news, Scandinavian ones.
Read a couple of basic books on universal history
August 9, 2011 at 2:45 pm
Mr Psychic -look again into your crystal ball.
My credentials and character are not your concern.
I am not going to “brag about my academic record”
or travels,etc. Honesly I have been a fan of yours for a long time
but- let’s leave it with -you are wrong -not even close…
Still looking forward to reading your articles-
if you would prefer that I do not comment on your blog-
I can oblidge that request.
August 9, 2011 at 3:01 pm
It’s not about academic degrees or travels.
I know a Venezuelan girl who never finished primary school and has never been outside Venezuela. It’s about trying to form a more comprehensive view of the world with what is at hand, couple of sources here and there and not just the ones that fit to your current view.
I leave it at this but it is preposterous to say Obama is a communist.
August 9, 2011 at 3:02 pm
by the way-Madame de Pompadour
merci for disturbing your nap.
August 10, 2011 at 9:59 pm
So, NOW who are you calling names? Really? Did you know that merci means thanks? I didn’t think so…eejit.
August 10, 2011 at 9:33 am
Syria is basically a muslim country and it used to be under Russia thumb. Before, you say something stupid…I lived there.
August 10, 2011 at 9:36 am
So did many Marines and the wives of Marines and US employees plus a few expats who knew shit about the country they were in. You don’t argue with “I was in”, you argue with real arguments.
Can you please define what a Muslim is and what a communist is or you are the one who will go on saying things stupid?
Please, use arguments. “I was there” is not an argument.
The Taliban were supported by the US Americans and so is Saudi Arabia now and the US Americans are mostly not Muslims. So, THINK, María.
August 8, 2011 at 10:49 pm
I thought that many, maybe even 40% of prisoners, were being held without due process of law, or the prisons were very over crowded. I believe I read that here. So yes she is extreme, but there may be a point in there. Like most appointees that I have read about around 80% to 90% of their ideas are way off, while 10% to 20% have some merit. 40% sounds like a high number of prisoners that should be let go though.
August 8, 2011 at 11:10 pm
No, what she said is that 40% should be free according to the Law. Now, as I said before, she is not a Martian that just landed and realized this, she has been a staunch supporter of this Government that allowed to keep this people in jail. Why was this? I believe this was a policy of the Government, that is, since they could not control crime, they would keep people in jail so that they would not commit them, whether they should be or not. But Ms. Valera says this as if she has not been a part of this Government for 12 years. Who was responsible for this policy or this illegality? As long as nobody is guilty for errors and abuses, nothing will change. Of course she has a point, but she is not a member of a new incoming Government discovering this, she has been a Deputy of this Government for 12 years, she never noticed this “problemita”?
August 13, 2011 at 7:33 pm
Fair enough, thanks for the explanation I had misunderstood the connection you pointed out.
August 8, 2011 at 10:46 pm
Been thinking the whole day that Chavez has shown again his Machiavellian nature in naming Iris Varela as Minister of Prisions. La Fosforito is a liability for his new image of inclusion, peace and love, and what better way to get rid of her than her appointment to a post where she will undoubtely fail! He got rid of GodGiven Hair by naming him Governor of Miranda and thus removed him from the center of power that is Miraflores Palace.
August 8, 2011 at 9:43 pm
Just a remark… near 70% of Central bank reserves is gold, booked at current gold price. The value of this gold is almost 60% more than 1 year ago.
Take out the IMF draft holdings and you see that assets in foreign currency and bonds are just a pity 25%, ie ..7.5 Billions US$.
Since during the last 12 months BCV reserves were steady around 30 Billions it is easy to add up that liquid assets hold in BCV (foreign currency and bonds) were reduced from near 15 Billions in 2010 to just 7.5 Billions today.
August 8, 2011 at 11:06 pm
It was 60% as of May, but it can be sold, it is being held abroad.
August 9, 2011 at 11:12 pm
Correct Miguel.
It was 60% in May at a price of 1500/ounce. There were 403 TONS of gold reported
According to World Gold Council, no gold was sold from BCV in these 2 months.
So, the same tons of BCV gold on July 31 were priced a juicy 21.5 Billions out of the total 29 Billions reserves.This is more than 70%.
My point: there are less foreign currency and bonds in BCV reserves today than in May, almost 1 Billion less. A huge decline.
August 8, 2011 at 9:25 pm
Meanwhile back in Havana its chemo, chemo, chemo…
August 9, 2011 at 7:50 am
It’s bathing with Fidel and Raul and entertaining
fawning idiot visitors from abroad-ALBA minions,
lefties from US, et al-so much more..
August 8, 2011 at 5:28 pm
at this point we in the USA will happily trade you our nit wit affirmative action boy Prezident for your mentally ill narcissistic banana republic hefe
http://www.cnbc.com/id/44058141
August 8, 2011 at 6:47 pm
Speed and gordo: You have GOT to be kidding.
August 9, 2011 at 8:15 am
yes masochistic (sp?) humor was the goal….but buckwheat is actually worse than cater
August 8, 2011 at 7:08 pm
Speak for yourself, Speedo. I wouldn’t wish either on anyone.
anywhere-not even Zimbabwe.
May the winds of change blow their (*(*0s away very soon!
August 9, 2011 at 3:14 am
This is the worst song of all time. It was crap in 1989 and is even worse now. The fly in my toilet can make better music.
August 9, 2011 at 3:09 pm
Not even close. “Lady Willpower” by Gary Puckett and the Union Gap.
August 12, 2011 at 1:05 am
Not even close. The very worst was and will always be “Que lastima que seas tan chamita”, Basil Alexander, Sonografica, 1984.
http://www.salvavinilos.org/2009/01/22/basil-alexander-sonografica-1984/
August 9, 2011 at 5:08 am
Not so quick Speedy. Our problem only has 17 months to go and we can ride out. Venezuela’s problem, Chavez ain’t going nowhere unless it’s in the ground.
August 9, 2011 at 11:36 am
We’ll take him,even steven.
And Jefe is with a J, moron.
August 8, 2011 at 4:39 pm
Well, in the USA, the oil companies are making the BILLIONS! Let’s not compare apples and oranges… USA is politically dysfunctional due to political inability to compromise. Let’s home Venezuela doesn’t go down that road.
August 8, 2011 at 4:24 pm
My hair stood on end and I went numb at the figures, the Weimar Republic will be a footnote in history in face of Giordani´s debacle
August 8, 2011 at 4:03 pm
Octavio
You do not have to convince Giordani that inflation is a monetary phenomenon, as M Friedman said long time ago in his well-known thesis A Monetary History of the United States, 1867-1960 as you remark in your note, and consequently – my remark- a political issue. You have to catch up the “mainstream Venezuelan macroeconomics” which thinks more or less like Giordani’s, that inflation is inertial and somehow caused by increasing costs, speculation, monopoly, and so on, you will be surprised the consensus about it.
As any bureaucrat Giordani only counts nominal money supply, he does not deflate it; he can print it whenever he needs, so the causality runs the other way round, from prices to money…..jejeje
@AlexGuerreroE
August 8, 2011 at 3:27 pm
On No. 3 ) If the government is Ok with Varela’s idea of not accepting more prisoners, then it would be Ok to not receive more sick people at hospitals or in general just not perform any other collapsed public service
August 8, 2011 at 2:59 pm
As per loopy government planning….
I just glanced over at the current oil price and was shocked to see that it had dropped to 80 dollars a barrel (now, …wow). This may correct itself, of course. But, what if it doesn’t? What if the people in the Finance Ministry and PDVSA “counted” on having 105 dollar a barrel of crude for the next 12 months? It’s probably in all of their budgets. Oh my. This is gonna get interesting,….very interesting.
August 8, 2011 at 4:11 pm
Do not worry, we go for the remake, they did in 2008, Chavez and Giordani followed very close Goldman Sachs’ forecast of oil prices to be at 200 dollars at the end of that year.
They, Chavez and Giordani, did not adjusted government expenditure, on the contrary, the passed a new debt law in November 2008 for 40.000 Millions in order to compensate the fallen oil revenues, Chavez said the that he was “blindado”…jejeje…..we have seen this film several times, we know the end, but I agree, this time could be not only interesting, but horrendous!!!…jejeje
AG
August 9, 2011 at 8:33 am
More bonds, more loans. I don’t see the house of cards falling until after the election, unfortunately.
August 8, 2011 at 2:34 pm
You’ll get both and you’ll like it!!!!
August 8, 2011 at 1:53 pm
Miguel, in #3 you left out the word “no” as in “Ordered that now NO new prisoners be admitted in any jail in Venezuela”.
What would you prefer twelve years of Iris with the crime rate doubling or tripling again or another 1,200% of inflation?
How about neither.
August 8, 2011 at 2:29 pm
It was a w that snuck in after the no….goblins