This Is The Best Investment Of 2015... Just Don't Adjust For Hyperinflation

Tyler Durden's picture




 

It's that time of year again. When hindsight is 20/20 and coulda/woulda/shoulda gives way to reality. With the US equity market barely able to keep its head above green water, a look around the world shows investors could have done a lot better (or not).

In fact, as Handelsblatt shows, the best investment in the world in 2015 would have been - drum roll please - Venezuelan stocks!

Note - these returns are from a EUR-denominated persepctive

 

So - that proves it - buying stocks during hyperinflation "works" and protects your purchasing power, right?

Not so fast! While Venezuela's official spot Bolivar rate has been flat at 6.2921 all year as Maduro dreaded the admission that his nation is in utter collapse, the "real" exchange rate - or 'Dolar Libre' Rate - has been crashing...

 

Which means, if you wanted to "invest" in Caracas Stocks last year (by moving your USD into Bolivars, buying stock, then moving your "gains" back into USDs to bring home and celebrate), things look a lot different.

 

From a 287% gain, you would have actually lost 22% of your initial USD stake!

So sorry, hyperinflation does not pay after all! Still, The Fed, ECB, BoJ, PBOC will keep playing the 'inflate' and debase game until they are all proven wrong.

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Wed, 12/30/2015 - 16:04 | 6979268 Lady Jessica
Lady Jessica's picture

Investing in fantasy = winning.

Investing in real things = barely breaking even.

Wed, 12/30/2015 - 16:12 | 6979308 Kaiser Sousa
Kaiser Sousa's picture

only in fiat currency terms...

and they r worthless.

Wed, 12/30/2015 - 21:35 | 6980368 Scarlett
Scarlett's picture

dude, bovespa is in fucking brazil, not venezuela...

Wed, 12/30/2015 - 16:05 | 6979272 _ConanTheLibert...
_ConanTheLibertarian_'s picture

When does Venezuela finally default? And Argentina? And PR? And....

Wed, 12/30/2015 - 16:07 | 6979285 Bunga Bunga
Bunga Bunga's picture

They forgot Argentina. Great returns as long as you count it in paper money and not in loaves of bread.

Wed, 12/30/2015 - 16:08 | 6979288 PoliceThePolice
PoliceThePolice's picture

"From a 287% gain, you would have actually lost 22% of your initial USD stake!"

 

Like when I got married, I thought I was gaining a 2nd income. Turns out I'm losing money, big time.

Wed, 12/30/2015 - 16:20 | 6979341 feeb
feeb's picture

Fortunately my wife makes double what I do. It's paying off for now. But she is about to retire in her early 30's, now it's all on me! I was duped!

Wed, 12/30/2015 - 16:55 | 6979474 The central planners
The central planners's picture

But at least you have something where to stick your stake :D

Wed, 12/30/2015 - 16:21 | 6979342 Repet
Repet's picture

And at the same time, the best performing currency in the world in 2015 is.... Bitcoin. Well done to all my fellow hoarders.

http://www.cnbc.com/2015/12/29/bitcoin-is-one-of-2015s-biggest-winners.html

Wed, 12/30/2015 - 17:50 | 6979693 Pool Shark
Pool Shark's picture

 

 

Good thing you didn't start hoarding last year, or you'd have a lost a bunch:

http://www.kitco.com/finance/bitcoin/

Wed, 12/30/2015 - 16:29 | 6979361 Strelnikov
Strelnikov's picture

That does it.  In '16 I'm weighting Venezuela shares 100% in the portfolio.  When times are uncertain, people need to have their money in the Venezuelan stock market.  Which can only go up.

Wed, 12/30/2015 - 16:53 | 6979468 optimator
optimator's picture

why the FED is not playing the inflate gain, haven't you heard how hard they are struggling to get inflation up to their 2% goal?

Wed, 12/30/2015 - 16:58 | 6979495 slackrabbit
slackrabbit's picture

Venezuela  stocks ....Its just like housing baby, the only way is up!

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