[Newsbot]

Title: Venezuelans blocked from buying flights out
Category: Business
Posted By: DrCaleb
Date: 2014-01-10 10:45:13

[MeganC]

They have all that oil and that stupid jerk Chavez wrecked the country!

[saturn_656]

MeganC MeganC:

They have all that oil and that stupid jerk Chavez wrecked the country!

Blasphemy! A true man of the people, like Comrade Hugo, wouldn't responsible for this! It's those chubby hamburger eating Yanquis! They are the source of all the worlds ills! Venezuela would be a global power with wealth and riches beyond imagination if it weren't for them!

*end sarcasm*

[RoyalHighlander]

saturn_656 saturn_656:

MeganC MeganC:

They have all that oil and that stupid jerk Chavez wrecked the country!

Blasphemy! A true man of the people, like Comrade Hugo, wouldn't responsible for this! It's those chubby hamburger eating Yanquis! They are the source of all the worlds ills! Venezuela would be a global power with wealth and riches beyond imagination if it weren't for them!

*end sarcasm*

And if it wasn't for drink, the Irish would rule the world ....

[Thanos]

I heard there's more drunks per capita in Ireland than there are people. :O

Ah, Venezuela. Isn't that Sean Penn's favourite anti-American shitocracy? And isn't that also where the heroic Edward Snowden wanted to flee to? I love it when actual facts on the ground, such as the reality of life in Hugoland, make the lefties look stupid(er).

[Brenda]

$1:

"I still plan to go to Madrid in May, but it's difficult to find a seat at a fair price,'' he says. "It's embarrassing that no one wants to accept the bolivar."

Blame your boy, not Air Europa.

[ShepherdsDog]

All that cheap gas so they could drive around and look for the shortest food lines

[BeaverFever]

"Wrecked the country"? Are you implying that the country was in good shape before Chavez, when it was a US puppet state?

Say what you want about Venezuela's disfunctions, since Chavez took control of the nation's oil reserves from the US puppeteers (the only reason that Americans care to complain about Venezuela in the first place) poverty has been reduced by a staggering 50%. Maybe it's still a basket-case, but it's a basket case with less poverty and better health care and better education.

[BartSimpson]

BeaverFever BeaverFever:

"Wrecked the country"? Are you implying that the country was in good shape before Chavez, when it was a US puppet state?

Say what you want about Venezuela's disfunctions, since Chavez took control of the nation's oil reserves from the US puppeteers (the only reason that Americans care to complain about Venezuela in the first place) poverty has been reduced by a staggering 50%. Maybe it's still a basket-case, but it's a basket case with less poverty and better health care and better education.

The purchasing power of everyone in Venezuela has been eroded by the 25%+ annual inflation rates that started with Chavez who decided to gin up bolivars to buck up the national budget. And now that particular chicken has come home to roost now that no one with a lick of sense will accept the bolivar for payment.

That said, if you measure poverty in bolivars then Chavez' polices have increased the incomes of the poor over 100 fold.

Measured in dollars or Euros his policies have slashed real average incomes by over 600%.

In sum, poverty is worse than ever.

[andyt]

Bullshit. Poverty is what your income buys you in your own country - or doesn't buy you. The poor aren't flying to Spain anyway. They have to buy food shelter clothes etc, and by that measure are much better off. The rich are less rich, hence the reduction in average wage. Something certainly needed to be done, to not just be a US vassal state like Cuba was.

$1:

Sorry, Venezuela haters: this economy is not the Greece of Latin America

For more than a decade people opposed to the government of Venezuela have argued that its economy would implode. Like communists in the 1930s rooting for the final crisis of capitalism, they saw economic collapse just around the corner. How frustrating it has been for them to witness only two recessions: one directly caused by the opposition's oil strike (December 2002-May 2003) and one brought on by the world recession (2009 and the first half of 2010). However, the government got control of the national oil company in 2003, and the whole decade's economic performance turned out quite well, with average annual growth of real income per person of 2.7% and poverty reduced by over half, and large gains for the majority in employment, access to health care, pensions and education.

Now Venezuela is facing economic problems that are warming the cockles of the haters' hearts. We see the bad news every day: consumer prices up 49% over the last year; a black market where the dollar fetches seven times the official rate; shortages of consumer goods from milk to toilet paper; the economy slowing; central bank reserves falling. Will those who cried wolf for so long finally see their dreams come true?

Not likely. In the opposition's analysis Venezuela is caught in an inflation-devaluation spiral, where rising prices domestically undermine confidence in the economy and currency, causing capital flight and driving up the black market price of the dollar. This adds to inflation, as does – in their theory – money creation by the government. And its price controls, nationalisations and other interventions have caused more structural problems. Hyperinflation, rising foreign debt and a balance-of-payments crisis will mark the end of this economic experiment.

But how can a government with more than $90bn in oil revenue end up with a balance-of-payments crisis? Well, the answer is: it can't, and won't. In 2012 Venezuela had $93.6bn in oil revenues, and total imports in the economy were $59.3bn. The current account was in surplus to the tune of $11bn, or 2.9% of GDP. Interest payments on the public foreign debt, the most important measure of public indebtedness, were just $3.7bn. This government is not going to run out of dollars. The Bank of America's analysis of Venezuela last month recognised this, and decided as a result that Venezuelan government bonds were a good buy.

The central bank currently holds $21.7bn in reserves, and opposition economists estimate that there is another $15bn held by other government agencies, for a total of $36.7bn. Normally, reserves that can cover three months of imports are considered sufficient; Venezuela has enough to cover at least eight months, and possibly more. And it has the capacity to borrow more internationally.

One problem is that most of the central bank's reserves are in gold. But gold can be sold, even if it is much less liquid than assets such as US treasury securities. It seems far-fetched that the government would suffer through a balance-of-payments crisis rather than sell its gold.

Hyperinflation is also a very remote possibility. For the first two years of the economic recovery that began in June 2010, inflation was falling even as economic growth accelerated to 5.7% for 2012. In the first quarter of 2012, it reached a monthly low of just 2.9%. This shows that the Venezuelan economy – despite its problems – is very capable of providing healthy growth even while bringing down inflation.

What really drove inflation up, beginning a year ago, was a cut in the supply of dollars to the foreign exchange market. These were reduced by half in October of 2012 and practically eliminated in February. This meant more importers had to purchase increasingly expensive dollars on the black market. This is where the burst of inflation came from.

Inflation peaked at a monthly rate of 6.2% in May, then fell steadily to 3% in August as the government began to provide more dollars to the market. It jumped to 4.4% monthly in September, but the government has since increased its auctions of dollars and announced a planned increase of food and other imports, which is likely to put some downward pressure on prices.

Of course Venezuela is facing serious economic problems. But they are not the kind suffered by Greece or Spain, trapped in an arrangement in which macroeconomic policy is determined by people who have objectives that conflict with the country's economic recovery. Venezuela has sufficient reserves and foreign exchange earnings to do whatever it wants, including driving down the black market value of the dollar and eliminating most shortages. These are problems that can be resolved relatively quickly with policy changes. Venezuela – like most economies in the world – also has long-term structural problems such as overdependence on oil, inadequate infrastructure, and limited administrative capacity. But these are not the cause of its current predicament.

Meanwhile, the poverty rate dropped by 20% in Venezuela last year – almost certainly the largest decline in poverty in the Americas for 2012, and one of the largest – if not the largest – in the world. The numbers are available on the website of the World Bank, but almost no journalists have made the arduous journey through cyberspace to find and report them. Ask them why they missed it.

[BartSimpson]

Look, on paper people are earning more than ever before. In reality what they're earning is buying them less than ever...if they can buy it at all:

http://www.theguardian.com/global-devel ... ountry-cia

That said, if you have a million bolivars and there's no food at the grocery stores, no electricity to light your house, no gas to warm it, no phone service, and no clothes to buy in the marketplace then you're living in poverty and all the nice little numbers on your bank statement don't mean jack sh*t.

$1:

It's the rainy season in Venezuela and Pedro Rodríguez has had to battle upturned manhole lids, flooded avenues and infernal traffic jams in his quest for sugar, oil and milk in Caracas.

His daily battle to find food is not new, but it's getting worse. "There is something about finally having enough to make ends meet and being unable to buy what I need because it's gone missing. It leaves me feeling indignant," says Rodríguez, a 55-year-old removal man who makes an average of £500 a month. "I haven't lost hope that things will get better, but sometimes the end seems nowhere in sight."

[BeaverFever]

No Bart, as Andy mentioned, Poverty is measured by what your income buys you in your own country - or doesn't buy you. So when they say poverty has reduced, they mean that people can afford more stuff.

As Bloomberg reported,

$1:

Venezuelans’ quality of life improved at the third-fastest pace worldwide and income inequality narrowed during the presidency of Hugo Chavez, who tapped the world’s biggest oil reserves to aid the poor.

Venezuela moved up seven spots to 73 out of 187 countries in the United Nation’s index of human development from 2006 to 2011, a period that covers the latter half of Chavez’s rule, which ended with his death March 5. That progress trails only Cuba and Hong Kong in the index, which is based on life expectancy, health and education levels.

...Venezuela has the lowest rate of income inequality – the smallest gap between the rich and the poor – of all countries in Latin America and the Caribbean, according to a March 5 report by UN-HABITAT, the United Nations Human Settlements Program.

The report, called “The State of Cities in Latin America and the Caribbean 2012,” uses the so-called Gini coefficient to measure inequality. It said Venezuela has the region’s lowest figure of 0.41, followed by Uruguay, and that the index has fallen “significantly” since 1990. The coefficient rates countries on a scale of zero to 1.0, with a higher number indicating greater inequality.

http://www.bloomberg.com/news/2013-03-0 ... havez.html

Of course if you read the above link, it's not all a good news story. There are quesitons about the side-effects of the social policies policies, questions of mismanagement and questions of whether any of it is sustainable in the long run.

I have no doubt that some, if not all, of these shortages -which is different from measures of poverty- are due to government mismanagement. But since the country can't really get any worse that it was before Chavez took office, I say go for it.

[BartSimpson]

Venezuelan agricultural output has plummeted since Chavez seized the private farms and ranches that were producing most of the nation's food. The stores that used to sell the food closed when Chavez seized them and pillaged them because they allegedly were not cooperating with his price controls. Foreign investment from countries other than Brazil has plummeted because the regime is fond of seizing anything foreign.

The country is in a death spiral and sometime soon it will either devolve into typical Latin American anarchy or there will be another revolution followed by yet another strongman with delusions of grandeur.

Either way, the country is circling the drain and the best media spin in the world won't stop it.

[QBall]

andyt andyt:

Meanwhile, the poverty rate dropped by 20% in Venezuela last year – almost certainly the largest decline in poverty in the Americas for 2012, and one of the largest – if not the largest – in the world. The numbers are available on the website of the World Bank, but almost no journalists have made the arduous journey through cyberspace to find and report them. Ask them why they missed it.

That's right mystery article, the poverty rate did drop in Venezuela, and how did that happen? Through pensions and subsidies that Chavez was giving out to the poor. However Chavez was so concerned with redistributing the pie he forgot to make the pie bigger. So what has that resulted in?

Venezuela's Inflation Rate Is 56%

http://www.businessinsider.com/venezuel ... 56-2013-12

Inflation, Shortages And Economic Turmoil: Venezuela On The Brink

http://www.ibtimes.com/inflation-shorta ... nk-1470274

S&P cuts Venezuela debt rating to B-minus

http://www.reuters.com/article/2013/12/ ... VQ20131213

And of course let's not forget the story this thread started on. So while the poor in Venezuela have more currency in their pockets it is quickly becoming worthless, nt that they have anything to spend it on.

[MeganC]

I don't get why some people don't believe what's right in front of them?