Venezuela Government "Occupies" Electronics Retail Chain, Enforces "Fair" Prices

Tyler Durden's picture


The socialist paradise that is Venezuela has already shown the Federal Reserve just how the world's greatest "wealth effect" can be achieved courtesy of the Caracas stock market returning over a mindblowing 475% in 2013. Of course, while the US inflation is still slightly delayed (if only for non-core items and those that can't be purchased on leverage) Venezuela's own 50%+ annual increase in prices is only part of the tradeoff to this unprecedented "enrichment" of society, or at least 0.001% of it - after all, it's all about the égalité.

More problematic may be the fact that in addition to a pervasive toilet paper shortage, a collapse in the currency, a creeping mothballing of the local energy industry due to nationalization fears, and a virtual halt of international trade as the country's FX reserves evaporate, Venezuela's relatively new government has adopted arguably the best and brightest socialist policy wielded by both Hollande and Obama, namely the "fairness doctrine."

However, in this case it is not about what is a "fair" tax for the wealthy (as taxes in Venezuela's socialist paradise will hardly do much to build up the desperately needed foreign currency reserves), but what is a "fair" price for electronic appliances like flat screen TVs, toasters, and ACs. The result is that Maduro's government now determines what equilibrium pricing should be.

The reason for this latest socialist victory over the tyranny of supply and demand is that overnight Venezuela's President Nicolas Maduro ordered the "occupation" of a chain of electronic goods stores in a crackdown on what the socialist government views as price-gouging hobbling the country's economy. Various managers of the five-store, 500-employee Daka chain have been arrested, and the company will now be forced to sell products at "fair prices," Maduro said late on Friday.

In essence Maduro is simply going now where Abe soon, and Mr. Chairwoman will go eventually, and in an attempt to offset inflation (at last check Y/Y inflation was over 50%) has effectively "nationalized" prices by forcing retail managers to ignore such trivial things as import prices, and to see well below cost, or at what the government has determined is a "fair" price. Maduro has stopped short of more outright nationalizations, in this case saying authorities would instead force Daka to sell at state-fixed prices. Needless to say outright nationalizations are the next step.

That this is the absolute idiocy of any socialist regime in its final, pre-hyperinflation dying throes is well-known to anyone who had the privilege of visiting Eastern Europe just after the collapse of the USSR. However, for the Millennial generation it should serve as a harbinger of things to come to every socialist country that thinks it can rule by central-planning ordain, through a monetary politburo, and is absolutely certain can contain inflation in "15 minutes" or less.

From Reuters:

State media showed soldiers in one Daka shop checking the price tags on large flat-screen TVs. And hundreds of bargain-hunters flocked to Daka stores on Saturday morning to take advantage of the new, cheaper prices.


"We're doing this for the good of the nation," said Maduro, 50, who accuses wealthy businessmen and right-wing political opponents backed by the United States of waging an economic "war" against him.


"I've ordered the immediate occupation of this chain to offer its products to the people at fair prices, everything. Let nothing remain in stock ... We're going to comb the whole nation in the next few days. This robbery of the people has to stop."


The measure, which comes after weeks of warnings from the government of a pre-Christmas push against private businesses to keep prices down, recalled the sweeping takeovers during the 14-year rule of Maduro's predecessor Hugo Chavez.

Venezuela's people obviously are delighted:

"Inflation's killing us. I'm not sure if this was the right way, but something had to be done. I think it's right to make people sell things at fair prices," said Carlos Rangel, 37, among about 500 people queuing outside a Daka store in Caracas.



Rangel had waited overnight, with various relatives, to be at the front of the queue and was hoping to find a cheap TV and air-conditioning unit.


Soldiers stood on guard outside the store before it opened.

But how is that possible: is the wealth effect from a 475% YTD return in the Caracas stock market not enough to make everyone perpetually happy and content?

Or did the uberwealth of the 0.001% not trickle down just yet? No worries: it will only take another executive decree to strip the wealthy of their assets, just like it took one order to determine what is "fair pricing" on 50 inch plasma TV, and to enforce "trickle down" economics in this utopia gone bad.

As for what is left of the remaining retail sector, they have gotten the message:

Opponents also blame excessive government controls and persecution of the private sector for shortages of basic goods ranging from flour to toilet paper, and for price distortions and corruption caused by a black-market currency rate nearly 10 times higher the official price.


"This ridiculous show they've mounted with Daka is a not-very-subtle warning to us all," said a Venezuelan businessman who imports electronic goods and is an opposition supporter.


Under price controls set up a decade ago, the state sells a limited amount of dollars at 6.3 bolivars, but given the short supply, some importers complain they are forced into a black market where the price is nearly ten-fold higher.


Maduro showed astonishment at a fridge on sale in Daka for 196,000 bolivars ($31,111 at the official rate), and said an air-conditioning unit that goes for 7,000 bolivars ($1,111) in state stores was marked up 36,000 bolivars ($5,714) by Daka.


"Because they don't allow me to buy dollars at the official rate of 6.3, I have to buy goods with black market dollars at about 60 bolivars, so how can I be expected to sell things at a loss? Can my children eat with that?" added the businessman, who asked not to be named.

Who expects your children to eat, citizen? After all they didn't build that negative profit margin. Just eat your peas, be replete of hopium, sell for a "fair price", be happy you don't have to sign up for under gunpoint, and don't forget to sing the praises of a socialist central-planning utopia. And always remember: BTFATH!

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Sat, 11/09/2013 - 13:01 | 4138462 hedgeless_horseman
hedgeless_horseman's picture



Fairness, latino debt slaves!

Read Confessions of an Economic Hitman, by John Perkins.

President Nicolas Maduro ordered the "occupation" of a chain of electronic goods stores...

What would he do if people stared using a local currency like the hippies in Western Massachussets?

Alice Maggio, you are a terrorist!  God Bless and keep you all, good people of the Berkshires.



Sat, 11/09/2013 - 13:04 | 4138487 Race Car Driver
Race Car Driver's picture

Only slightly off topic, but is now requiring you to log into Google+ read YouTube video comments.

Please watch the video and pass this along.

RED ALERT! Google Says Submit Or Lose Freedom Of Speech!

Edit to say ... FUCK GOOGLE.

Sat, 11/09/2013 - 13:07 | 4138500 Careless Whisper
Careless Whisper's picture

The Careless Whisper SATURDAY NEWS UPDATE & THREADJACKING--  Ahead Of Drudge

Newly Elected (50.5%) Miami Beach Mayor Philip Levine Campaigned On Promise To "End The Mañana, Lazy, Culture Of Government" (VIDEO)

Toronto (pop. 1.6 M) Mayor Rob Ford Sez He Smoked Crack Cocaine In One Of His Drunken Stupors (VIDEO)

Newtown CT May Fire Cop Claiming PTSD After Sandy Hook Hoax

Florida Tourism Agency Asks Google To Street View All Its Beaches

Sat, 11/09/2013 - 13:08 | 4138504 nope-1004
nope-1004's picture

In other words, prices are going UP!

That's the definition of gov't fairness, especially of a fiat whore economy.


Sat, 11/09/2013 - 13:12 | 4138512 Careless Whisper
Careless Whisper's picture

I wouldn't count on everything going up. Seems too easy for Mr. Bigshot with a big short in TSLA to smoke another car, and then the stock is toast. But I am rather cynical.

Sat, 11/09/2013 - 14:00 | 4138611 Manthong
Manthong's picture

undt ve vill aszure zat ze volkzen ischt proteschted

Sat, 11/09/2013 - 15:53 | 4138881 smlbizman
smlbizman's picture

its the final paragraph of anylasis that keeps the hedge, head and shoulders above all others....god damn i love fight club....

Sat, 11/09/2013 - 17:42 | 4139121 mjcOH1
mjcOH1's picture

"President Nicolas Maduro ordered the "occupation" of a chain of electronic goods stores in a crackdown on what the socialist government views as price-gouging hobbling the country's economy. Various managers of the five-store, 500-employee Daka chain have been arrested, and the company will now be forced to sell products at "fair prices," Maduro said late on Friday."


Where my Obama-TV?   Venenzuala got Chavez-TVs.   So where the fuck's my Obama-TV?

Sat, 11/09/2013 - 19:46 | 4139335 Mike in GA
Mike in GA's picture

Should be plenty of those big screen TVs here because they sure as hell won't ship any more to Venezuela.  Obama will be on this soon.  He might just ship some TVs to his buddy in Venezuela though, once the shelves are bare and no reordering.

Sat, 11/09/2013 - 16:07 | 4138916 Freddie
Freddie's picture

Has anyone else watched the endless Sandy Hook fraud videos?   I knew nothing added up on that whole story but was skeptical.   After watching lots of videos - The thing was totally fake.  Endless crisis actors.  Adam Lanza was effectively a ghost who disappeared about 4 years ago.  No ambulences with bodies.   Kids being interviewed saying they heard sounds like pots and pans falling and cops kicking doors.

Let see - it would have taken 60 to 80 gun shots but only 2 or 3 crisis actor children heard gun shots.  The other kids heard pots and pans.  Nobody got shot and survived.  Soem actors wandering around aimlessly on the set.  No video from inside the building like Columbine. Oh and there was a drill happening in another area of the state not far away on the same day in a school hostage situation.  Endless other things.  Totally fake.

Sat, 11/09/2013 - 13:14 | 4138515 lasvegaspersona
lasvegaspersona's picture

Race Car Driver

I watched the link about being forced to sign up for google plus to comment.

I just do not understand the mechanics of what is happening enough to understand why it is so upsetting. I see that comments are limited, but why. How is this bad?

Is it because there is no more anonymous commenting?

Sat, 11/09/2013 - 15:58 | 4138892 css1971
css1971's picture

The more centralised the authentication system, the easier it is to track everything you do online and everyone you know.

Next step is to use Facebook as your global account. This is why google are forcing people into google+, they want to be the global account system.

Then no matter what you do or what you say, it will always be traceable back to you, forever. Even better, at the press of a button they will be able to "disappear you" from the Internet.

Sun, 11/10/2013 - 11:17 | 4140285 tvdog
tvdog's picture

Disqus is the global account system.

Mon, 11/11/2013 - 10:12 | 4142458 StandardDeviant
StandardDeviant's picture

1) It's not only slightly off topic.

2) It's their site.  If they want you to stand on your head whilst reciting Milton in order to use it, that's their prerogative.

3) Freedom of speech doesn't mean that Google is somehow obligated to build you a platform on which to speak.

4) YouTube comments?  WTF?!  Have you actually ever looked at the YouTube comments?  I have, and don't intend to repeat the experience.  They make a BTC discussion on ZH sound educated, polite, and well-reasoned in comparison.


Sun, 11/10/2013 - 12:17 | 4140421 robertsgt40
robertsgt40's picture


Sat, 11/09/2013 - 12:51 | 4138467 GMadScientist
GMadScientist's picture

They're gonna look funny as shit sitting in front of a big-screen TV with no power to run it.

Sat, 11/09/2013 - 14:02 | 4138614 Manthong
Manthong's picture

s'not t like there is any excess energy down there or what..

Sat, 11/09/2013 - 14:42 | 4138727 Pure Evil
Pure Evil's picture

I hope in order to enforce "FAIRNESS" they imposed a 3 boxes of ammo limit, oops, I mean a 3 boxes of electronics limit.

Sat, 11/09/2013 - 16:06 | 4138910 smlbizman
smlbizman's picture

...and not being able to wipe their ass after they finishing pausing the dvr to take a shat...coming to a thearter near you.....its kind a like ur house (the rest of the world) is on fire...and its a grease fire, but they keep putting water on it..and it gets worse the answer is moar water (mr. moe yellen)...and the sheep in the living room(usa) know everyroom will burn but the one their in......

Sun, 11/10/2013 - 11:19 | 4140290 tvdog
tvdog's picture

I do remember firemen in suburban Cleveland pouring water on a magnesium fire, then thinking the resulting explosions meant they needed to bring in helicopters to pour more water on it ...

Sat, 11/09/2013 - 15:19 | 4138787 U4 eee aaa
U4 eee aaa's picture

They are probably buying them to sell later at some point. Those aren't consumer goods, they are investments

Sat, 11/09/2013 - 12:59 | 4138482 Dre4dwolf
Dre4dwolf's picture

Fair prices? thats fair.

You know what else is fair? when I move my store to another country and sell my inventory on ebay instead.

Sat, 11/09/2013 - 13:03 | 4138494 Skateboarder
Skateboarder's picture

If you have a PayPal account log in and go to your account settings. I hadn't seen this before, but now they're asking for your SSN or EIN. The circle is almost complete (someone will come knocking on your door asking why you didn't declare blah blah that you bought on eBay).

Sat, 11/09/2013 - 13:06 | 4138501 Race Car Driver
Race Car Driver's picture

See my link above - the screws are getting pretty tight.

Nevermind the floating Google datacenters ... they're just upscale showrooms.

... and don't forget, kids - "Do no evil!"

Sat, 11/09/2013 - 13:16 | 4138520 Skateboarder
Skateboarder's picture

I've been using YouTube since they first appeared, so I know the progression of the comments section damn well. It's been getting lamer and lamer, but just this week, something gnarly happened (what the video describes).

Go to gmail, see their monolithic advertisement "ONE ACCOUNT. ALL OF GOOGLE."

I have been a lazy fuck, but today I will be 'deleting' my sploogle account and saying good riddance.

Sat, 11/09/2013 - 14:00 | 4138541 hedgeless_horseman
hedgeless_horseman's picture



"Don't be evil."


Fascism is here. for certain.

On the positive side, where else can you watch and hear great music like this on demand? 

For our fellow Americans working at GoogleSpy and the NSA...

Go ahead and hate your neighbor,

Go ahead and cheat a friend,

Do it in the name of heaven,

You can justify it in the end.

Fourth Amendment of the Bill of Rights: The right of the people to be secure in their persons, houses, papers,
and effects, against unreasonable searches and seizures, shall not be
violated, and no Warrants shall issue, but upon probable cause,
supported by Oath or affirmation, and particularly describing the place
to be searched, and the persons or things to be seized.

I am already on The List, and have been for several years.  Everyone with half a brain and a little courage is on The List.

Sat, 11/09/2013 - 14:06 | 4138623 Manthong
Manthong's picture

hmm.. the desparity between tin and real soldiers.

Sat, 11/09/2013 - 16:56 | 4139033 Skateboarder
Skateboarder's picture

HH, working for Google is seen as a great thing, something to aspire to. Even from the beginning, they had the Google Labs Aptitude Test (don't think they do that anymore). A shitton of people take great pride in working for that shit, and they don't even have guns to their heads telling them they like it "or else."

p.s. 'pologies for wrongfully thinking you was hatin yesterday.

Sat, 11/09/2013 - 13:51 | 4138590 ThisIsBob
ThisIsBob's picture

Don't worry about them now asking for a phone number.  They will never bother you.  That's only for the NSA, et al.

Sat, 11/09/2013 - 14:43 | 4138729 kchrisc
kchrisc's picture

A while back a lot of these sites, especially Google, began asking for phone numbers--Just "to assist in password resets, etc."

Now with the NSA reveal, we now know it was to link our online "life" with our phones and then ultimately to us.

"Silly rabbits, tricks are for treasonous criminals."

Sat, 11/09/2013 - 15:43 | 4138859 Drachma
Drachma's picture

Right with you brother. It is done.

Sat, 11/09/2013 - 22:36 | 4139588 StychoKiller
StychoKiller's picture

Use Ed Gein's SS: 388-28-8860,

Here's R.M. Nixon's: 567-68-0515

Sun, 11/10/2013 - 01:41 | 4139808 kadoka
kadoka's picture

Where have you been?  It has been that way for two years now.  Once you breach the IRS cap, you and the IRS get a nice neat 1099

Sun, 11/10/2013 - 01:43 | 4139810 kadoka
kadoka's picture

Where have you been?  Paypal has been that way for two years now.  Once you breach the IRS cap, you and the IRS get a nice neat 1099

Sat, 11/09/2013 - 12:59 | 4138484 FieldingMellish
FieldingMellish's picture

Forward campadres!

Sat, 11/09/2013 - 13:02 | 4138491 Dr. Engali
Dr. Engali's picture

These idiots will never learn. Unfortunately this shit will work its way up the food chain until it reaches us, and we'll see just how destructive price controls can be.

Sat, 11/09/2013 - 13:27 | 4138539 disabledvet
disabledvet's picture

Nixon tried it. didn't work too well. QE exists to bail out banks not you and me. Once it is wound down the demand for credit will soar, it's availability will fall and prices will be "fixed" by remaining low as the deflation brought on by 2008 grinds on.

Sat, 11/09/2013 - 13:29 | 4138542 El Vaquero
El Vaquero's picture

Not to give them any ideas, but I think our fucksticks who would institute price controls will see themselves as more "sophistocated" than the fucksticks in South America.  I could easilly see them taking the fairness doctrine a good bit further and instituting price controls while adding new subsidies to the supply chain, pushing the breakage off to some other sector.  It's only "fair," afterall, that we don't put those retail employees out of business.  Such actions might even extend things, but in the end, the result will be the same. 

Sat, 11/09/2013 - 19:50 | 4139344 FreedomGuy
FreedomGuy's picture

Exactly, right. There is a fundamental arrogance in all collectivism. It is essentially the arrogance of "I know best and I am smarter than you." which is inherent to State control. The truth is that they are actually dumber, not smarter. Look, really look at most of the people in goverment and if you are a person who actually knows real world stuff about any profession, you recognize they do not. Obamacare was designed by people who want to control and also get even with different parts of healthcare they do not like. Typical loser socialists. Obama was a freaking community organizer. He knows nothing about nothing outside of getting free stuff from government.

There is an added arrogance that Americans are smarter than everyone else so we can make this stuff work, just as you say, Vaquero. It will fail every time because economies are infinitely complex and any one person's knowledge is infinitesmally...small.

Sat, 11/09/2013 - 13:10 | 4138507 Smegley Wanxalot
Smegley Wanxalot's picture

Note to Venezuelans: That box the TV came in can be stripped into layers and used to wipe your ass.

Sat, 11/09/2013 - 14:46 | 4138734 Pure Evil
Pure Evil's picture

You might want to soak it in water overnight to soften it up a bit.

And don't forget to remove the gigantic metal staples holding the bigger boxes together before using those sections to wipe your arse.

Sat, 11/09/2013 - 15:21 | 4138799 U4 eee aaa
U4 eee aaa's picture

After eating the bread you may need the staples

Sat, 11/09/2013 - 16:13 | 4138931 Poor Grogman
Poor Grogman's picture

Why waste the cardboard on ass wiping when it can be gifted to your 12 year old as his new house.

Hey I'm sure a cardboard box will seem like luxury in a few years.

Sat, 11/09/2013 - 13:10 | 4138510 ChaosEquilibrium
ChaosEquilibrium's picture

The "re-evaluation' of price and value!!! least Maduro is open and dishonest!!!


The US and FED are doing the same thing..only covertly with deceit, lies. and ignorance!!!!

Mon, 11/11/2013 - 15:32 | 4143305 FreedomGuy
FreedomGuy's picture

There are no property rights in socialism.

A fair price is whatever the hell you want to charge. If you own the TV store the property is yours. You can keep it all and not sell it or you can charge a million per TV or you can give them away for free. Each choice has different consequences.

The State pretends it knows or an control consequences. It cannot.

Sat, 11/09/2013 - 13:26 | 4138533 q99x2
q99x2's picture

Electronics isn't Oil or currency which the King of q99x2 requires to be publicly owned and operated utilities. We also have free healthcare but that comes with being a citizen not from insurance. Electronics? department store? That sounds like corporate facism similar to what we have on my other planet in the United States.

Sat, 11/09/2013 - 13:26 | 4138536 Careless Whisper
Careless Whisper's picture

Note to Venezualan businesses; There's consequences if you don't pay the protection money to the communist mafia.

Sat, 11/09/2013 - 13:41 | 4138551 lolmao500
lolmao500's picture

The FSA army would certainly approve of this if it were to happen in the US.

And if Fukushima goes kaboom, Venezuela's inflation problems will be the least of their problems when hundreds of millions try to move South to avoid radiation...

Sat, 11/09/2013 - 13:37 | 4138553 Dr Benway
Dr Benway's picture

Price controls equal empty shelves or no customers. Either way nothing is bought or sold.


Funny how every central banker also thinks they can adjust "market" prices, and still have a "market".

Sat, 11/09/2013 - 13:39 | 4138558 Kreditanstalt
Kreditanstalt's picture

Not so different...

We are burdened with "fair" "minimum wages", "fair" pro-union legislation, "fair" fake interest rates and on and on and on and on...

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