Venezuala- New economic lunacy

Discussion in 'Economics' started by HectortheInspector, Jan 11, 2010.

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  1. Chavez has apparently decided that after devaluing his currency, there is in fact no need for prices to go up.
    http://news.bbc.co.uk/1/hi/business/8451056.stm

    This kind of fiscal wish fulfilment was quite common during the later Roman Empire, where the Government repeatedly robbed its citizens through devaluation, but never thought that there would be consequences further up the supply chain,when the supplier raised his prices to reflect the lower real value of the currency being used to buy his goods.

    The Roman empire then fell over.

    What this proves is that Chavez has allowed his Marxist fantasies to override whatever briefings his economists have provided. Since he also runs one of the most outspoken regimes, (and has cosied up to the Iranians as well), this looks like yet another failed-state-in-the-making.

    The good news is that, so far, Alastair Darling has not been seen investing in Venezualan Government bonds.
     
  2. And the cherry on the top of this loony Marxist cake is that he is deploying the Army to beat up on shopkeepers who raise prices as a result rather than go bust.

    I suspect that a lot of "going Galt" is going to be going on in the next few months over there, as well as emigration.
     
  3. Did Chavez not appoint the failed London Mayor comrade Ken Livingstone as some sort of advisor?.
     
  4. Not quite sure. For some reason, tho, Transport for London was buying Venezuelan oil to run buses. Only the truly cynical would think that this was a way for Ken to fund the regime of one of his Marxist buddies...
     
  5. The oil deal got sacked by Boris.
    Fortunately, though our Ken got offered a job by Chavez.
    http://news.bbc.co.uk/1/hi/uk/7585330.stm

    Which could explain why the place is rapidly heading into disaster.
     
  6. The spin was that Chav gave Ken free oil in return for consultancy on a CCTV system to manage traffic in Venezuelan cities.

    Turned out that the 'traffic cameras' were the same as the state of the art facial and number plate recognition cameras that are used to secure London from terrorist attack.

    Chav wanted to keep an eye on anybody he didn't like. Ken was only too happy to help.
     
  7. As an aside, surely Sterling has been devalued by the Government/Bank of England printing extra money?
     
  8. Bouillabaisse

    Bouillabaisse LE Book Reviewer

    It's the same marxist claptrap that happened in Zimbabwe where Bob sent in the army to enforce price controls on food in the face of mahoosive inflation, with the result that the shops emptied of goods and there were no more to buy (and no money to buy them with). The difference is that Chavez has been using oil money to subsidise food prices.
     
  9. 'Quantitative easing' it's called nowadays.
    After a while it becomes 'hyperinflation'
    then 'Mugabenomics'
    Finally 'In the Brown stuff'.
     
  10. chavez has stopped being funny now :oops:
     
  11. What's the probability that when it starts to come down around him he'll be looking for a foreign military adventure just like any tinpot dictator?
     
  12. Which is why Colombia are looking to buy lots of French LeClerc MBTs?
    http://www.arrse.co.uk/Forums/viewtopic/t=142094.html

    That's possibly why Chavez picked a Colombian-French firm to get spiteful on...