Venezuela: the land of 500%
inflation, 12/16
Venezuela is spiraling down fast while its biggest problems are skyrocketing up. Inflation in Venezuela is projected to increase 481% this year and by a staggering 1,642% next year, according to new estimates released Tuesday by the International Monetary Fund. "Venezuela is on the precipice of hyper-inflation," says Kathryn Rooney Vera, research director at BullTick Capital Markets in Miami.
The IMF also forecasts that Venezuela -- which rarely publishes its own economic data -- will have an unemployment rate of 17% this year and nearly 21% next year.
For
some context, the last time the unemployment rate hit that high in the United
States was during the Great Depression in the 1930s, when it spiked to as much
as 25%.
"Venezuela is experiencing a very
severe economic crisis," says Francisco Rodriguez, chief Andean economist
at Bank of America Merrill Lynch. "This is not a recession, this is a
depression."
Inflation has already been a huge
problem in Venezuela. In January, the Venezuelan government said
inflation rose 141% in the year ending in September. That means prices for all
types of goods, such as milk, sugar and flour, are soaring. Basic goods such as
toilet paper and soap are in such short supply some hotels are asking guests to bring their own.
The
value of Venezuela's currency is crashing rapidly. On the black market
exchange, where most Venezuelans exchange U.S. dollars for the home currency,
bolivars, one dollar equals 1,125 bolivars. A year ago, one dollar equaled 258
bolivars.
Venezuela's
official exchange rate system is complicated and has multiple tiers. One
exchange rate allows ordinary folks to exchange one dollar for 306 bolivars,
well behind the black market rate.
Socialist President Nicolas Maduro has
continued the massive public spending and welfare programs that his
predecessor, the late Hugo Chavez, instituted over a decade ago.
However,
the country can ill afford them. Its economy is in trouble and plummeting oil
prices has only made it worse. Venezuela has the world's largest oil reserves and about 95% of its exports are oil.
The country is overwhelmingly dependent on oil to power its economy.
With
oil prices still low, Venezuela's problems continue to mount. The country can't
pay for basic food or medical imports, leaving many people without basic food
items and medicines.
In
a sign of growing anger among the people, Venezuelans elected a new,
opposition-led Congress in
December. A major bloc in Congress wants to impeach Maduro but that could prove
difficult because the country's Supreme Court is packed with judges who were
appointed by Maduro. A change in president or policy doesn't appear imminent,
experts say.
"We
have this institutional paralysis, it contributes to the economic
deterioration," says Mauro Roca, an economist at Goldman Sachs. "As a
result of this paralysis, it's going to be difficult to implement any economic
reforms."
Venezuela
problems could worsen significantly later this year. The government must pay
about $5 billion in a series of debt payments in October and November. The
country's foreign reserves are already
withering at 12-year
lows.
http://money.cnn.com/2016/04/12/news/economy/venezuela-imf-economy/index.html?iid=hp-stack-dom
Venezuela
Video:
The
collapse of petro-dollar dependent socialist Venezuela is not covered in US
news, but there are some reports coming out from independent journalists. Crime
in Venezuela is out of control. Inflation has been well over 100%. Economic
devastation is complete. See video: https://www.youtube.com/watch?v=UOQb7Y5QVO8
US Financial Collapse is predicted
for October 2016. Published
on Apr 4, 2016 - Jeff Berwick's new viral video, "Elite's
Planning Economic Crisis in 2016 See Video: http://surviveshemitah.com/TDV1127EY3G/
Comments
We’ve
been hearing predictions of the collapse of the US dollar ever since the Fed
started QE in 2009. This has resulted in a 450% increase in the money supply.
Government
money printing to support excessive spending has traditionally been paid for by
debasing the currency and inflation increases.
Our current, pending 450% inflation tab can be paid for with 10%
inflation for 45 years or 45% inflation for 10 years, or 450% inflation in 1
year.
Western
governments have held interest rates low because of their large amounts of
government debt. They are not in a position to allow any inflation or interest
rate increases, or their government budgets would suffer. They will continue to
try to have citizens pay for their spending by keeping unemployment high and
wages low.
UN Agenda
21 requires the dissolution of all current governments, but I doubt that Russia
or China will play along to be ruled by a corrupt Oligarchy using the UN as a
front. I do believe our economic decline since NAFTA has been engineered by our
own federal government on purpose.
Rumors of
a US dollar crash are valid, but they should be based on default and that’s not
likely. Currency crashes happened in
Zimbabwe and Argentina a few years ago and is currently occurring in
Venezuela.
Citizens
are wising up and demanding that their governments abandon their destructive
policies, but it will take a while for these changes to be made. Australians
fired their Pro-Carbon-Tax government and encouraged the US to continue to
reject this hoax. But, Canada elected a Liberal bunch and are going to suffer
from excessive Muslim immigration. Europe is ready for reform and Germans
should fire Angela Merkel this year. If they do, others will follow. Europe is certainly watching to see if Trump is
elected in the US. He is our best chance
for rapid reform and a return to the rule of law, because Trump is like
“Roundup” for political correctness and he is a Populist.
The key
to our survival must begin with the total destruction of political correctness
and heavy doses of economic reality. We can greatly reduce the cost of
everything we need and pay off our National Debt, but to accomplish this we
will need to remove all special interest campaign contributions and replace 90%
our entire Congress with free market Constitutionalists.
Norb
Leahy, Dunwoody GA Tea Party Leader
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