Today, Latvia’s ABLV Bank—its third largest, and largest private bank—announced that it had received approval from the Council of Financial and Capital Market Commission (FCMC) to liquidate, and that the Bank was proceeding with the process of liquidation.
Some have applauded Maduro's recent moves, claiming that they will stabilize the bolivar and eliminate inflation. This, of course, is nothing more than a pipe dream. While the bolivar has strengthened a bit and inflation has temporarily abated and stabilized, the bolivar bounce is nothing more than a classic dead cat bounce.
We compute the implied annual inflation rate on a daily basis by using PPP to translate changes in the VEF/USD exchange rate into an annual inflation rate. The chart below shows the course of that annual rate. With Venezuela’s change in exchange rate system, we have seen inflation slow down. Regardless, today's implied annual inflation rate is 6230%/yr, still the highest in the world (see the chart below).
On January 29th, Venezuela announced that one of its two official exchange rates was being eliminated. While the bolivar strengthened a bit and inflation temporarily stabilized after the new system was announced, the bolivar bounce resulted in nothing more than a classic dead cat bounce.
Today, Bulgarians strongly support the currency board and oppose dumping the lev for the euro. After all, the currency board is the most prized post-communist institution in Bulgaria. It has delivered stability. And while stability might not be everything, everything is nothing without stability.
Privatization would eliminate negative cash flows for the federal government. This would obviously benefit all U.S. taxpayers, who must now pay taxes to support the federal government’s retention of public grazing lands.
President Trump and his trade team remain clueless about the economics of trade. Their recent imposition of tariffs on the imports of Chinese solar panels and South Korean washing machines is but the latest evidence of a wrongheaded and dangerous U.S. trade policy. Wrongheaded because it is based on incorrect economic analysis. Dangerous because it will inevitably result in a trade war in which there are no winners.