If the socialist leaders of Latrine America had any brains, or any real concern for the future of their nations, they would take a look at this news story and change course immediately. Of course, none of them will do any such thing. Instead, they will keep driving their economies into the ground, following the pattern established by Fidel Castro half a century ago.
You do have to admit, though, that the money printed with reckless abandon by leftist despots can sometimes be very, very colorful. Vamos bien!
Venezuelan Bolivar devalued; prices bound to skyrocket in Caracastan
Venezuelans lined up to purchase airline tickets and TVs this weekend in a bid to protect themselves from price increases after ailing President Hugo Chavez devalued the bolivar for a fifth time in nine years.
Chavez, who is recovering from cancer surgery in Havana, ordered his government to weaken the exchange rate by 32 percent to 6.3 bolivars per dollar starting Feb. 13, Finance Minister Jorge Giordani told reporters Feb. 8. Yesterday, a sign at an electronics store in southeastern Caracas restricted customers to one purchase each as Venezuelans rushed to buy flat-screen televisions.
A weaker currency may further fuel the fastest inflation rate in the region as about 70 percent of products consumed in Venezuela are imported or assembled from raw material shipped from abroad, according to the Consecomercio trade chamber in Caracas. The move, which seeks to narrow the budget deficit, may undermine support for Chavez and his allies ahead of possible elections this year as the cost of living increases.
“Any economic measure always has winners and losers,” said Luis Vicente Leon, president of Caracas-based polling firm Datanalisis. “No one devalues for fun. If you devalue to correct a problem, there’s always going to be a price to pay.”
A spending spree that almost tripled the fiscal deficit last year helped Chavez, 58, win a third six-year term. The devaluation can help narrow the budget deficit by increasing the amount of bolivars the government receives from oil exports.
Yet the move may also quicken inflation to more than 30 percent a year from 22 percent in January, Siobhan Morden, the head of Latin America fixed income strategy at Jefferies Group Inc. in New York, said in a note to clients.
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