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Venezuela Launches First Nuke In Currency Wars, Devalues Currency By 46%
While the rest of the developed world is scrambling here and there, politely prodding its central bankers to destroy their relative currencies, all the while naming said devaluation assorted names, "quantitative easing" being the most popular, here comes Venezuela and shows the banana republics of the developed world what lobbing a nuclear bomb into a currency war knife fight looks like:
- VENEZUELA DEVALUES FROM 4.30 TO 6.30 BOLIVARS
- VENEZUELA NEW CURRENCY BODY TO MANAGE DOLLAR INFLOWS
- CARACAS CONSUMER PRICES ROSE 3.3% IN JAN.
And that, ladies and gents of Caracas, is how you just lost 46% of your purchasing power, unless of course your fiat was in gold and silver, which just jumped by about 46%. And, in case there is confusion, this is in process, and coming soon to every "developed world" banana republic near you.
and just as we (and Kyle Bass) have warned - this is what happens to the nominal price of a stock market as currency wars escalate... how do those US investors who flooded Venezuela with cash feel now? bringing back those VEF gains is going to hurt...
The chart above is a free lesson in nominal vs real: the hardest lesson for some 99.9% of the world's population to grasp. One person who certainly knows how to devalue a currency in real terms FDR, whose 70% devaluation of the USD courtesy of executive order 6102, is merely an appetizer of what is about to be unleashed upon the US.
From Bloomberg:
Venezuela devalued its currency for the fifth time in nine years as ailing President Hugo Chavez seeks to narrow a widening fiscal gap and reduce a shortage of dollars in the economy.
The government will weaken the exchange rate by 32 percent to 6.3 bolivars per dollar, Finance Minister Jorge Giordani told reporters today in Caracas. The government will keep the currency at 4.3 per dollar for some products, he said.
A spending spree that almost tripled the government’s fiscal deficit last year helped Chavez win his third term. Chavez ordered the devaluation from Cuba, where he is recovering from cancer surgery, Giordani said. Venezuela’s fiscal deficit widened to 11 percent of gross domestic product last year from 4 percent in 2011, according to Moody’s Investors Service.
The move can help narrow the budget deficit by increasing the amount of bolivars the government gets from taxes on oil exports. While a weaker currency may fuel annual inflation of 22 percent, it may ease shortages of goods ranging from toilet papers to cars.
In the black market, the bolivar is trading at 18.4 per dollar, according to Lechuga Verde, a website that tracks the rate. Venezuelans use the unregulated credit market because the central bank doesn’t supply enough dollar at the official rates to meet demand.
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Yeahz, I hear a lot of the Kennedy coat tail rider spewing state aid radio ads in terms of heating oil for the needy courtesy of Senor Chavez. Praise be!
FLASH: A NEW POLITICALLY CORRECT TERM
LYING & DECEIT ARE OUT!
HISTORICAL DRAMA IS IN!
"Here's my rule: Ask yourself, "Did this thing happen?" If the answer is yes, then it's historical. Then ask, "Did this thing happen precisely this way?" If the answer is yes, then it's history; if the answer is no, not precisely this way, then it's historical drama."
'Lincoln' screenwriter fires back at Conn. congressmanhttp://www.usatoday.com/story/life/people/2013/02/08/lincoln-screenwrite...
Castro too...Spielberg said that meeting Castro was the greatest moment of his life; he was totally awed.
I wonder if he would(as a Jew) be AWED by the numbers of folks murdered at the hands of that death defying whore?
Only if they were Jooos
Since 'they' consider the resr of us a cattle.
"Our race is the Master Race. We are divine gods on this planet. We are as different from the inferior races as they are from insects. In fact, compared to our race, other races are beasts and animals, cattle at best. Other races are considered as human excrement. Our destiny is to rule over the inferior races. Our earthly kingdom will be ruled by our leader with a rod of iron. The masses will lick our feet and serve us as our slaves."
— Israeli Prime Minister Menechem Begin
This isn't a new thing for them. 15 or so years ago I worked for a company with a couple of large customers who had business in Venezuela, back then the exchange rate was around 600 Bolivars to the dollar (which rose to over 1000 /USD over the next few years) and interest rates were in the 20% neighborhood if I remember.
Anyway, lucky thing it can't happen here, there I think the problem was that they were rampantly fiscally irresponsible - giant government debt and deficits and whatnot.
Yeah, whew! That was a close one. I thought I might have to start paying attention to currency manipulation here in Good Ole America but I know the gov't has everything under control.
What's on the tee vee tonight?
No TV it's snowing. In New England. In February. Holy shit, this has not happened since.....like, last week.
You see the Exec Order that Deval signed banning travel?
Jail or 400 buck fine...
Papers, please.
The NYT said that the snow storm is caused by global warming.
So does that means war is caused by peace? Illness caused by health? Obesity is caused by skinniness?
anybody that takes the time to compare charts of the solar cycle's waxing and waning of sunspots to a climate chart knows al gore's crew timed his song and dance to swoon the shabby shiek Walmart elite into believing humanities only salvation is taxpayer funded "private" carbon bank pig `n a poke was timed perfectly with his daughters bridal grovel into the Schmitt family hive - of course her subsequent divorce out of the vampire queen's slime bucket [also] coincided with old al's argument falling on it's face and the collapse of one of the most obvious innovations in snake oil salesmanship we have had the pleasure of witnessing.
Still GE is suck billions of taxpayer subsidies - the whisper is to move ethanol content from 10% to a lofty electronic fuel injector busting 15% - meaning GE and Virgin Airline Gadfly Big Dog, Sir Dick, will reap a shitload more in US taxpayer treasure to grease what ever that ugly thing they grease is ..,
Yeah and Argentina is going down the shitter as well.
But, the Venezuela stock market was up nearly 300% in 2012?
Don't knock it.Now its just 150%.
He who rats out first,rats out best.
And with the gains you can buy three eggs.
With the government having all of $217 in the bank, the Zimbabwe stock market is still the 'best' performing in Africa....
http://www.theafricareport.com/20130204501822940/southern-africa/zimbabw...
In 2007, as the government was on its way to $Z100 trillion banknotews, the Zimbabwe industrials index was up 600% in the first four months of the year - and 12,000% over the previous 12 months....
meanwhile any able bodied citizen is panning for gold - a pinch of gold dust buys enough food for a day.
man, i should go there with a container of Twinkies for Gold!....oh wait.
I think that they had to pay for Chavez's cancer treatment.
Pay? For Chavez' treatment? No no no! No PAY in Castro's Cuba! Health care is FREE, just like in Obamacare!
Cuba don't need no stinkin' money!
Obama don't need no stinkin...oh, wait.
Moar taxes, rich people. (Soon EVERYBODY rich!)
It's not like it's unpredictable.
Every where, every time. From FDR to Hugo Chavez and everywhere inbetween.
Devalue the currency. Bit by bit, or all at once, they don't really care that much. Surveillance state.
Then comes the mass extermination camps, and the war - war - war.
Always. Every. Single. Time.
The only solution is getting the government out of the money creation business. Trade with each other in weights of whatever commodity you like.
Bang! Freedom, and with real freedom comes prosperity.
As I read that:
Golf clap....steady applause....crescendo.....fuck yeah!
Wouldn't have anything to do with the fact the all the banksters mostly stem from the same gene pool would it? Nah! silly thought....
www.synagoguerising.com
Carumba !
That's quick. Wish the US owned some gold.
The US is golden and reputation is all that matters.
thats my man Chavez....first got his gold back and now goin out with a -
FUCK YOU BERNANKE AND ALL YOU OTHER WESTERN SOCIOPATH BANKER COCKSUCKING BITCHES!!!!!
we can all play now mother fuckers....SILVER BITCHEZZZZZZZZZZZ.....
we beat them to the punch by devaluing our politicians
When, exactly, did our politicos have enough value to justify a devaluation?
85 bil/mo and we are pikers....whocodoknown
Nice one, cheaper bananas.
Wow! We knew it was possible that somebody would toss a bomb but it's still a bit of a spine-tingler when it actually happens. This surely isn't the last one.
Pathetic! To win the currency war, you need to do much more.
CIA overthrow is next, for "destabilizing the region." Earth to Lyndon Obama: bombs away!
They've been giving Chavez cancer so he'll be out of the way fairly soon.
Yeah real smart give a man a chance for revenge.
Now thats what I'm talking about.
Balls in your court shalom, what you gonna do?
Fucker
He'll do what any good little jew would do... PRINT MOAR!
Don't be a little pussy Ben show him who swinging the biggest dick. You can do it Ben ramp that printer up and show em how it's done.. it's too late to act like a little pussy now. getterdone
Print money with one hand, suppress PMs with the other. Don't screw up now Ben! Push faster, harder!!
Expect more venezualian elites to bring suitcases full of cash to America and Canada to exchange for dollars - fuck you bernanke!
Currency war and Ben is loosing it.
GODDAM!! :P
Now what, Ben? You just been pimp slapped by yo bottom bitch!!
Friday - You just got knocked the fuck out!
http://youtu.be/q36uaSlf0ck
Sheep: I can't stop laughing at that one.
Article: "And that, ladies and gents of Caracas, is how you just lost 46% of your purchasing power, unless of course your fiat was in gold and silver, which just jumped by about 46."
And what happens to you as a local when you convert your gold and silver back to fiat to pay your bills?
No, I am not against PMs as I have a small portion invested in PMs. My point is that as long as the population is forced into fiat, they are subject to fiat and all the bad things that come with fiat. Devaluation, inflating - these are just methods they use to manipulate THEIR currency. When you HAVE to convert back to pay your utilities, your food, you are back under their rules.
+1
"And what happens to you as a local when you convert your gold and silver back to fiat to pay your bills?"
oh, i dont know...what did they do back over the last 5,000 years with real money???
and, even if u have to convert back...let me see...wouldnt you get a lot more worthless peices of shit tahn you would otherwise if u didnt have any real money to start with?????
just asking.....
not really........
Who cares how? Would you trade contemporary lifestyle for any obe life style from the past? I doubt it.
How do you say "black market" in Spanish?
muerte rápida
Somos amigos, no?
Mercado Negro, but I prefer Negra Modelo.
Yes, and their rules say that paper is now 46% (or whatever %) cheaper.
So the local dicator basically decided your PM holidings are more valuable.
There's nothing to not like about that.
Let's see...
When you sell your gold you need to pay all those taxes on the big money you just made on that investment....
and you get paid back in devalued currency - so that was a great deal!
Let's see...
When you sell your gold you need to pay all those taxes on the big money you just made on that investment....
and you get paid back in devalued currency - so that was a great deal!
Take that, Japan!
what this tells me is that i should get loans on a new car and new house, watch the currency tank, and pay them off with my then sky-high stack!
there are official FX rates and then there are real FX rates. This is an official FX rate change. The real FX rate has been way higher(lower) than 6.30 for some time now. So no, the people didnt lose 46% overnight they already lost it and then some.
How does this affect crude prices?
Up 46% in Caracas
Banana split.
oil bitchez, they have it therefore they win. Quicker/cheaper route for the USA to take it off them rather than heading off to the M.E. though, can't understand why anyone in the past few administrations hasn't introduced a form of helicoptered in democracy, too close to home, fear of reprisals?
No, the Chinese told Washington in no uncertain terms that they will cut our naval supply lines at the Panama canal (which they now run) and they will crash our bond market overnight if Chavez's oil gravy train gets fucked with in any way. The dick-sucking cock bites in DC are pussies when it comes to making war with ANY country that can actually fight back...
Now please explain how would the "crashed" US bond market hurt the US. The Fed can keep buying bonds for another 5 years without any problem.
While you're at it, also explain how would a "crashed" US bond market be useful to China.
--
You're a great comedian.
easy. Start selling US bonds on the secondary market for much less and drive yields up. US will crash instantly as everyone runs for the f-ing exit.
so you would sell out your portfolio at big losses to prove a point?
I think China maybe uses US T-bills a colladeral to borrow, to buy,... oh, African mines, oilfields, and Canadian mines, oilfield interest(see pipeline Obama squashed) etc.
Bernanke devalued by 46% too. Big fucking deal.
I think the offical number is 97% since the FED was at the switch.
So Venezuela devalues... Is that a big deal? Is that front-page news? Doubt it. PDVSA does not sell its oil for bolivars, or whatever they call their funny money. It sells it for dollars. So what's the big deal, ZH? Unless some of you guys are Venezolanos, in that case I feel for you.
"Well Mr. Chairman....get to work...."
The one advantage the FED has is the print controls are manned by private sector. Insomuch as it is predicatable the devaluation of the USD will be slow and steady in order to line the pockets of the private share holders. This is the "lesser evil" of a government controlled currency printing press which is turned on and speed adjusted accrording to the political winds of dancing with the stars.
It's a 31% devaluation; not a 46% devaluation.
You're backwards on your math. You divide the difference from where you began,not where you ended up.
Sweetness. Dr.E.
Delta = 2
2/4.3 x 100= 46.5%
Old rate: (1 dollar / 4.3 bolivars) = US $0.2325
New rate: (1 dollar / 6.3 bolivars) =US $0.1587
New bolivar USD value of $0.1587 is 68.26% of its old USD value of $0.2325, or 31.74% less.
If you're counting in dollars, and I am.
this from the country that repatriated it's gold first..now devaluation first..who will follow or defacto devalue well that's a long list..fiat magic making everyones labor a negative value, except those tbtf and central banksters..get a job with the FED or some abc agency in DC. you will be protected, otherwise good luck.
Stay away from bankers, you are putty in their hands.
[Deleted]
They waited to get their gold first.. Then WHAM!
What difference does it make what was done first?
How long before Japan finally decides to bite the bullet and devalue by 200% ?
Dr. E. I'm not so sure how good you are at reading charts. usd/jpy is on hold. Abe has been warned.
Nope. Japan alresdy declared the Yen has fallen too much. "So it is written, so it will be truth".
Think before you comment. Ed;
How would they devalue by 200%? Pay you to take their yen?
This shit is better than real life.......
Hang on a minute..........
Fuck it, never mind?
OT.
http://www.aljazeera.com/news/asia-pacific/2013/02/201328151250783405.html
Painting by numbers?
China was one press of a button away from war with japan.
**** BREAKING ****
B.Shalom.B announced that he's devaluing the USD by 40% against the USD.
heh...umm....wait....ok...heh!
The timing of all of the recent events just seems a bit.....coordinated.
Things are not what they seem. Nobody knows nottin'!
So did the Iranian finance minister who tried to bring in 300 M bolivar check into Iran and got knabbed, know anything about this? :D
So much for front running (literally):
http://www.zerohedge.com/news/2013-02-03/former-iranian-central-bank-head-caught-smuggling-70-million-bank-venezuela-check-ge
It was into Germany.
So you're saying they created 1.85 times more wealth?
Carretillas, perraz!
boom...
Where is Whiteshadowmovement? this is why you hold precious metals as part of your portfolio.
Doc -
More noise, or is this really interesting?
Right now it's just noise, but it's the inevitable path of all debt ridden fiat currencies.
Hey doc, i think my comment here would be that we need to context what they are devaluing against: namely the usd. As long as you have dollar supremacy (by the way do you know the fofoa article i referenced) and beranke is in control of markets, im just saying it wouldnt be a shocker if paper gold is the one hard asset that underperforms most others, and that through protracted attacks on market psychology, bernanke could eventually keep it there, which would bleec into the bullion market over time. See ya monday guys
Venezuela crude at a 30% discount globally is potentially a big deal. Obviously if it hits a 70% discount "and it still can't break into the US market" and you have a real crisis (hyperinflation) in that country. You want to compare "Apples to apples" in the race to debase...that would be the canadian dollar as "they're the other one that can't sell into the US market" if they have to compete with Chavez. China wouldn't be far behind if Canada goes belly up.
He's busy arguing that retail owns enough gold to scare Ben into doing something drastic like dropping gold to 1000-1200 to teach them a lesson. Because gold prices are entirely psychology driven.
yeah ~ he'd do it just for the lulz [which I'm sure would prompt the Chinese to dump all their tons on the market]...
It must be one of those counter-intuitive things.
Fuck All Creditors (until the Fed and gov't force me to become one).
So, I have an inverted H/S pattern, (yen crosses), on the M-5 chart for Sumway?
Hyperinflation Bernanke and the Fed will annouce one much better.
They will devalue the US dollar by 100%.
And so the US has currency wars with 3rd world nations.
The GBP is next I reckon.
i like your thinking.
Care to elucidate on that ?
Well, I'll take a shot if you don't mind?
Towering national debt that would almost make Japan proud. Forgot to mention an increasing deficit to go with it.
Trade deficit, just getting worse and worse with north sea oil & gas running out.
Triple dip recession on it's way in.
Shiny new Bank of England governor, a jonny foreigner.
The populace have no fucking clue what money is so have no idea by whom they are being fucked.
It's already in free fall against the EUR & USD and to prevent a recession they really should stop sending 100 billion GBP a year abroad.
Timing's a bitch as always but they can always blame it on the new guy. They're politicians after all. Everything says devalue to me, which would be ironic because the conservatives are in power at the moment. Thank goodness I store most of my value in something else.
Mine also,though some of my income, and assets are in pounds.
The Japan situation is actually more appropos than you think.
UK has vast foreign holdings,far more than Japan.Hard to put a figure
on the value added fraud from London as well.
Pound is not on a fixed range or peg,so hard to see a reason for a formal
devaluation.At least their debt is stated in GAAP terms,unlike the US, whose dollar is
only being propped up by the petro dollar..Not much longer IMO.
Shit,all the fiat is going to be toilet paper ,why are we arguing over the brand of wipe.
Are we done Gents?
perhaps this [chess match] , is better discused over a cup of {High Tea} ?
Maybe the Long Island brew ?i
You know I like you W/C. Z/H isn't the S&P and Moody's.
well we can now all say "the petro dollar" is a bunch of bullshit. obviously ANY oil rich nation that doesn't have a huge consumer to back it up is in DEEP doo doo. Tell me...what was the deal with "the Corn Laws" back in the day?
if everyone devalues, then nobody devalues.
if the $, Yen, Euro,Yuan all devalue, it's meaningless.
Timing.
100% ponzi. The first devaluation wins. Tyler my posts are being chopped. Fragments are being lost?
In any case, The race to debase, has certain constraints. When said costs (feeding the serfs) is an outlier, the Serfs ( RIOT)...
Your fingers aren't translating your thoughts again. NOT TYLER'S FAULT.
not quite. Everyone will still need to pay more fiat (regardless of flavor). So everyone who has to actually work for their fiat does indeed lose. Those close to the free money supply on the other hand benefit tremendously. If interest rates went up proportionally, then people with some savings might not be losing as badly, but it's a ZIRP-a-NIRP world now - "winning".
Pain for gain. When ,not if interest rates go up, it won't be demand based. You kick butt [Laws of physics]
I wish there were more peeps like you !
Debts are denominated in currency and the principals will be instantly cut in terms of real values. The most indebted will devalue the most.
this is simple minded bullshit. THERE ARE 300 MILLION REGISTERED CARS IN THE USA! "go ahead...run all the debt you want." at some point "that thing call an F-150 pick up truck will have value too." believe me i'd love to sell mine for say...$100,000 or so.
Y'know, if they all start going for it like this to pay off their debts, we're seeing the start of a 40 year move. i.e. For most of us, the rest of our lives.
Well Germany cannot devalue yet...they have not yet received their gold from the Fed.
Chavez brought his gold home , and then devalued.
That is the real race....who repatriates (and physically receives) their gold first.
If only America could get it's gold from the FED....Oh wait, its all leased out...
"my country is bankrupt and now paying the Americans 20% interest but at least we got our gold back!" hoooray! get a clue you dope. Brazil is STILL paying usurious rates of interest from their 80's hyperinflation. Gold can't even come CLOSE to that return.
BULLISH!
not sure how up to date this is but the stock market aint moving (don't think it even qualifies for most EM stock indices)
http://www.bloomberg.com/quote/IBVC:IND
condos?
divide these by 2?
http://venezuela.gabinohome.com/en/sale/caracas
Rules of Currency Wars by Loa C. Tong
He who devalues to 0 first, devalues best.
He who gets his metal away from the shit first, shines it best, first
Hookers 2 for 1 in crackass, venezuela-SWEET!
Nah, I'm thinking more like 10-1with regards to the hookers.
I wouldn't hit up the hookers though. To many diseases. As a westerner, you could probably go into the village and hit up a few of the local women.
You're giving the locals too much credit by assuming that they are smart and can count.
Time to go to Venezuala as a sex-tourist. Get me some of that reverse-gangbang action.
No need to go to Venezuala horny tourists. California has massage parlors on every corner. Conveniently located between sexy lingerie shops and liquor stores where you can get your contraceptive devices. Asian girls for the diminitive man - oh yes. The wife of your neighbor, the daughter of your coworker, the sister of your bride can all be found on Main Street, America.
Cash only.
Citizens of Venezuela are only allowed to exchange $5000 dollars worth of Bolivars annually at the official exchange rate. Therefore, the Bolivar for Dollar black market is very healthy. Many companies such as PEDEVESA the National Venezuelan oil company supply dollars to the black market for Bolivars so that it can pay its employees at a much lower exchange rate then the official one. In Venezuela the black market rate was 10,000 - 11,000 bolivars for each dollar (last week). I wonder what the new black market rate will be, maybe 15,000 to 20,000 bolivars for a dollar. The devaluation is actually going to be worse then the 46% listed. when Chavez took control of Venezuela almost all of the big businesses were nationalized. The rest closed up shop and re-opened in Columbia, Panama, etc. Almost all foodstuffs and finished goods are imported now. If the black market rate goes from 10,000 to 20,000 then that is a 100% devaluation in real purchasing power for the average citizen.
I have family in Venezuela and several attempts to kidnap them have been made. Nasty business and very dangerous in Caracas. My brother inlaw told me that a lot of the crime syndicates run out of the prisons. He stated they have become like fortresses protecting the criminals and allowing them to operate unobstructed. Prison guards don't make a livable wage so criminal syndicates have completely taken over. The prisons have become protected bases of operations for the criminals.
2nd amendment comment. I showed my brother in law my AK and 9mm. He said it was illegal for citizens to own weapons in Venezuela. Only the criminals from the Gov't and from the street have them. He lives behind concrete walls with barbed wire running at the top, and his car has been armored with bullet proof glass and reinforced steel in the doors. My family lives in constant fear, and it wears on them. The bunker mentality is common in Caracas. I hope we don't see that in America. Its hard to believe that Venezuela was once considered a jewel of the world in the 1950s.
My brother inlaw told me that a lot of the crime syndicates run out of the prisons. He stated they have become like fortresses protecting the criminals and allowing them to operate unobstructed. Prison guards don't make a livable wage so criminal syndicates have completely taken over. The prisons have become protected bases of operations for the criminals.
....
I hope we don't see that in America.
Unless we change course pretty dramatically, it's exactly what you should expect. Government protects our criminal overlords in the USA as well, but for now, it also does a reasonable job of placating the poor with a social safety net.
If the safety net fails, there really won't be much reason for the USian poor to continue to kow-tow to the rich. Kidnapping is not something folks WANT to do, but if one's only options are watch the family starve or attempt some "high-risk/high-reward" criminal act, the crime becomes a lot more appealing.
Sounds like we're all a lot better armed, which should count for something, one way or another.
What I find fascinating is that prior to chavez there were no taxes. Gov't income came from the sale of oil. Now Gov't men show up demanding millions of dollars in taxes or they nationalize your business and your assets. Gov't sponsored extortion.
My wife's family in Venezuela became wealthy and were continually expanding. Now everything is a hedge against inflation and crime. Fraud is rampant. It has become all consuming. They are attempting to start roots in other countries, but its hard when your paradigm shifts so abruptly. They are like the early mariners, rudderless on the open seas hoping for salvation.
They see the dollar and the Euro as a life raft in the ocean. I tell them to run for Gold and Silver. They don't get it. They don't understand the U.S. debt situation. They only know that the dollar has been the reserve currency and they invest accordingly. How much of the world views the Dollar though a similar perspective? Many will be caught unaware when the dollar floats to the top of the lake like all the other currencies.
fishing is my plan. there will be a hyper-inflation in Venezuala soon tho. (days away?) the Statists are running wild in the USA...but eventually you realize "there's a billion acres for the taking." In American LAND AND WATER is the currency...not that worthless dollar...or the gold. Venezuala has a huge coastline...but living on your own lake strikes me as challenge. We have a billion lakes and ponds in the USA too. Why pay for a highway system when you have the Great Lakes or the Mississippi or Chesapeake Bay? Once that unlimited source of free energy is tapped (meaning the sun) i'd argue "it's game over for ALL the ponzi's." a collapsing dollar is WAY down on that list.
Next in line for devaluation: Argentina. Official rate 5 pesos per USD; informal rate 7.65 pesos per dollar.
http://www.ambito.com/economia/mercados/monedas/dolar/
Argentina's idiot bitch presidenta idolizes Chávez -- she went to visit him in Cuba.
She'll follow his lead ... he paved the way for her.
MOAR PESOS, SÍ SE PUEDE!
LOL, is Bloomberg suffering from dyslexia? They're reporting that this is a 32% debasement.
http://www.bloomberg.com/news/2013-02-08/venezuela-devalues-currency-from-33-to-6-30-bolivars-per-dollar.html
Not that this would be surprising, right? This is, after all, the mainstream media and nobody seems to know shit about real economics/finance...
WTF!
Maybe ZH poster Gringo28 works for bloomies?
2/6.3 = 32% Wrong
2/4.3 = 46% Correct
MSM is discounting the move by using the post valuation as the denominator. Classic.
was this article updated? cause the address to the article is reflecting 32 percent.
USD value of bolivar fell from US$ 0.2325 (1/4.3) to US$ 0.1587 (1/6.3).
That's a 32% drop in USD value.
Tyler,
Make calculating increase/decrease in percentage as a answer to join the forum.
People don't know the basis number. Increase from what number?
'Increase' refers to an indirect forex quote (bolivars per dollar).
In direct terms (what we care about), the bolivar dropped from $0.2325 to $0.1587.
The reference basis is $0.2325, what the bolivar was worth in USD before the devaluation (as in 'down from').
phuck the bolivar. "give us your free oil now." sound about right? i mean if you're in the transportation business "this is mana from heaven."
A barrel of oil that was 4300 bolivars is now 6300 bolivars ... 46.5% more, thanks to a 32% devaluation of the bolivar.
Confusing? It's the same asymmetry that makes you need a 46.5% gain to recover from a 31.7% loss in stocks.
This is why academics use log changes in market studies:
LN (4.3/6.3) = -0.382
LN (6.3/4.3) = +0.382
SUM = zero (equal and symmetrical)
LOG CHANGES, BITCHEZ ...
"log the dollar" cuz they're going to need a lot more of them. amazingly Venezuela used to own thousands of gas stations in the US. Great way to launder money and finally compete with Wall Street! Instead "they sold all their gas stations only to go bankrupt anyways." dopes. what happened Chavez? Keynes is disappointed...
The currency VEB was effectively trading at the new rate in the cash black market for a long time now. Banks and credit card transactions took place at the previous more costly "official " rate and as a result most transactions were in cash.