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Thread: Hyper inflation in Venezuella

  1. #1

    Thumbs down Hyper inflation in Venezuella

    This is what Chavez had to resort to. Its all about the money isn't it:

    Mr. Chávez's ability to fund welfare programs and other subsidies at the core of his popularity is undercut by plunging oil prices. Increasingly, residents of Venezuela say they believe Mr. Chávez will have to devalue the "strong bolivar" currency he introduced last year. Price controls meant to contain 30% inflation have led to food shortages. On Saturday, Mr. Chávez dispatched troops to force rice makers to boost production.
    Price controls always lead to shortages.
    Cheers,
    mark...






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  3. #2
    It's amazing that "rulers" never seem to learn from history. Hasn't the whole "price controls always lead to shortages" thing been known since, um...ancient Egyptian times? (I'm completely not joking...actually, we've known it for longer. We have known that price controls cause shortages SINCE THE DAYS OF THE BABYLONIAN EMPIRE AND HAMMURABI, and people are still making the same stupid mistakes!)
    Last edited by Mini-Me; 03-02-2009 at 02:39 PM.

  4. #3
    Quote Originally Posted by voytechs View Post
    Price controls always lead to shortages.
    The same will happen in America once hyperinflation hits.

  5. #4
    Quote Originally Posted by Mini-Me View Post
    It's amazing that "rulers" never seem to learn from history.
    Chavez doesn't want to play by the globalist rules, simply because he's not in charge.

    Imagine a country that had a free market, no taxes, non-interventionist foreign policy and strong army against agents of the IMF. It would very quickly become the wealthiest country on earth. Ohh wait a minute, that is what we are fighting for
    Cheers,
    mark...




  6. #5
    I read somewhere on these boards where Chavez just ended the people's right to keep and bear arms.
    "They [the Soviets] intend...to induce the Americans to adopt their own 'restructuring' and convergence of the Soviet and American systems ... Convergence will be accompanied by blood baths and political re-education camps in Western Europe and the United States. The Soviet strategists are counting on an economic depression in the United States and intend to introduce their reformed model of socialism with a human face as an alternative to the American system during the depression."
    Anatoliy Golitsyn The Perestroika Deception 1990


  7. #6
    Quote Originally Posted by Mini-Me View Post
    It's amazing that "rulers" never seem to learn from history.

    Yes they do!

    They Grandstand and spend like there's no end to the money when the economy is doing Well.

    and of course...

    The Rulers use Fear, Force, and Propaganda when THEY (gov/Banks) screw it all up!

    PS: When it's real bad all these "RULERS" Scurry like Rats and Cockroaches Hiding in their Government Bunkers.

    Lying Thieving Cowards! Somethings never change
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    June 1826



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  8. #7

    Night follows day

    It is like night following day - socialism leads to inflation. Inflation leads to price controls. Price controls lead to shortages. Shortages lead to government confiscation of the means of production. Government operation of production leads to a slow spiral into bleak poverty and police state politics.

    Welcome to the USA 2015

  9. #8
    On Saturday, Mr. Chávez dispatched troops to force rice makers to boost production.
    Another Socialist dictator and his country showing their true colors. I imagine Venezuela will end much like the Soviet Union did. Another gigantic central-planning failure in the making.



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  11. #9
    Quote Originally Posted by voytechs View Post
    Chavez doesn't want to play by the globalist rules, simply because he's not in charge.

    Imagine a country that had a free market, no taxes, non-interventionist foreign policy and strong army against agents of the IMF. It would very quickly become the wealthiest country on earth. Ohh wait a minute, that is what we are fighting for
    Yep, Chavez has had the misfortune of going head to head with the Globalists. Resource rich land was stolen from the people in his country, and they are rightly deserving of some of the wealth generated from said resources.

    Chavez has had to take drastic measures to ensure that the people in his country do not suffer from the tyranny of the global corporations that ascended into his resource rich country to steal from the citizens and drive them into poverty, but I certainly don't agree a lot of them, like using troops to boost rice production.


    This post is missing the point, however:

    Quote Originally Posted by Knighted View Post
    Another Socialist dictator and his country showing their true colors. I imagine Venezuela will end much like the Soviet Union did. Another gigantic central-planning failure in the making.
    Last edited by dannno; 03-02-2009 at 02:50 PM.
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  12. #10
    Here's the post about Chavez disarming the citizenry
    http://www.ronpaulforums.com/showthread.php?t=181887
    "They [the Soviets] intend...to induce the Americans to adopt their own 'restructuring' and convergence of the Soviet and American systems ... Convergence will be accompanied by blood baths and political re-education camps in Western Europe and the United States. The Soviet strategists are counting on an economic depression in the United States and intend to introduce their reformed model of socialism with a human face as an alternative to the American system during the depression."
    Anatoliy Golitsyn The Perestroika Deception 1990


  13. #11
    Not trying to defend Chavez here, but to be objective, inflation in Venezuela is way different than in "developed" countries.

    1) When Chavez got to the power inflation was arround 30%.

    2) Chavez got inflation down to near 20% in a few years (while paying back the whole national debt!!!)

    3) If now inflation is back to 30% because of the crisis is not that bad.

    You guys sometimes fail to see that just because an economy or a goverment calls itself capitalist, it does not mean it is capitalist. Venezuela had corporatist socialism, and under Chavez it had populist socialism (and the beggining of Chavez were quite alright, because he was still a bit naive and idealist, but power corrupts...). The USA has been calling itself a capitalist country and it can hardly aply as a capitalist country for the last 100 years.

    Hugo

  14. #12
    Force rice makers to boost production? $#@!ing totalitarian nutjob. What's even worse is hearing progressives who I often listen to defending this guy and other such statist tactics.

  15. #13
    Quote Originally Posted by Mini-Me View Post
    It's amazing that "rulers" never seem to learn from history.
    Not economic ignorants like Chavez, at least.

  16. #14
    30% may be high but it is still not hyper inflation.

    It was actually some of those darn corporations which helped Venezuela develop its wealth by investing in oil production and paying the goverment for licenses and royalties. But Chavez started nationalizing the oil industry and so the corporations left and now the oil production infrastructure is starting to crumble because it is not being maintained nor is much exploration for new sources going on because Chavez is taking all the profits to give away. So not only has the price of oil gone down, their production is falling too. The Venezuelan economy has been poorly managed under Chavez but that has been hidden so far by their oil revenues. Now those are falling quite badly. Iran is facing simliar problems of losing basically the only functioning portion of their economy. You can add Russia to that list as well.

    http://www.latinbusinesschronicle.co...e.aspx?id=3175
    Venezuela Oil: Worse Shape

    STEEP DECLINE: Venezuela's oil exports have dropped 42 percent since 1997, the author calculates. (Photo: PDVSA)

    The Venezuelan economy may be in far worse shape than officially announced, and in a weaker position to face the present sharp fall in oil export revenue.
    BY RAMON ESPINASA

    There is a large discrepancy between Venezuela’s official production figures and the substantially lower production data reported by international agencies. In addition, domestic

    petroleum consumption has likely been much higher than officially reported. The debate around the production, domestic consumption and export figures is important for at least four reasons.

    First, these figures constitute the basis for the assessment of the performance of Petróleos de Venezuela (PDVSA), particularly on how the company has evolved since late 2002-early 2003 strike that brought operations to a halt and in which the government fired half the industry’s labor force.

    Second, since crude oil production may be lower and domestic petroleum consumption much higher, petroleum export volumes could be considerably lower than reported, with implications for both oil export revenue and determining which markets are effectively supplied and by how much.

    Third, oil export revenue figures are calculated on the basis of the official export volume figures; thus, official oil export revenue estimates may be grossly overestimated. If so, the actual amount of funds available to the government could be just a small percentage of the official reported revenues. Stated differently, the Venezuelan economy may be in far worse shape than officially announced, and in a weaker position to face the present sharp fall in oil export revenue.

    Fourth, Venezuela’s exports to markets other than the United States, the Caribbean and Central America are lower than Venezuela’s official figures state. In addition, the latest oil provided by Venezuela under government-to-government agreements was sold at a discount, with payments financed over a 25-year period. As a result, Venezuela has become ever more dependent on its exports to the United States as a source of export cash revenue. The bottom line is that official figures for the last decade may overstate export volumes by as much as 55 percent. PDVSA exports, excluding the strategic associations1, may be overestimated by as much as 75 percent. (…)

    FALLING PRODUCTION

    According to IEA, crude production in Venezuela has declined to 2.36 million barrels per day (MBD) in 2008, down from 3.18 in 1997. That is a drop of 0.82 MBD or 26 percent.

    Last edited by Zippyjuan; 03-02-2009 at 07:42 PM.

  17. #15
    Quote Originally Posted by Zippyjuan View Post
    30% may be high but it is still not hyper inflation.

    It was actually some of those darn corporations which helped Venezuela develop its wealth by investing in oil production and paying the goverment for licenses and royalties. But Chavez started nationalizing the oil industry and so the corporations left and now the oil production infrastructure is starting to crumble because it is not being maintained nor is much exploration for new sources going on because Chavez is taking all the profits to give away. So not only has the price of oil gone down, their production is falling too. The Venezuelan economy has been poorly managed under Chavez but that has been hidden so far by their oil revenues. Now those are falling quite badly. Iran is facing simliar problems of losing basically the only functioning portion of their economy. You can add Russia to that list as well.

    http://www.latinbusinesschronicle.co...e.aspx?id=3175
    Good point!
    Cheers,
    mark...




  18. #16
    I had a man come into my store who was on his way back to Venezuala. It's amazing to speak to someone who is actually from there. He says it's basically hell on earth with Chavez. He has family there so he's going back. He also commented that it's sad Obama is taking us down the same path.



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  20. #17
    Quote Originally Posted by Zippyjuan View Post
    30% may be high but it is still not hyper inflation.

    It was actually some of those darn corporations which helped Venezuela develop its wealth by investing in oil production and paying the goverment for licenses and royalties. But Chavez started nationalizing the oil industry and so the corporations left and now the oil production infrastructure is starting to crumble because it is not being maintained nor is much exploration for new sources going on because Chavez is taking all the profits to give away. So not only has the price of oil gone down, their production is falling too. The Venezuelan economy has been poorly managed under Chavez but that has been hidden so far by their oil revenues. Now those are falling quite badly. Iran is facing simliar problems of losing basically the only functioning portion of their economy. You can add Russia to that list as well.

    http://www.latinbusinesschronicle.co...e.aspx?id=3175
    Nothing like gobbling down a barrel of propaganda.

    Those Corporations don't invest a dime when they move in to exploit a country's resources. They have the government borrow the money from the IMF to upgrade infrastructure and build production facilities. The work is done by the Carlyle Group, Bechtel, Halliburton, etc. Then the "royalties" of 5% go to the puppets who agree to burden the people of that country with the debt.

    The whole deal is prearranged and extremely overpriced in favor of the bank and the corporations. The people get nothing but debt.

    Chavez kicked Exxon the $#@! out which enabled venezuela to pay the IMF loans in full in '07.

    Otherwise, like America, Venezuela would never...never have gotten out from under that debt.

    As far as the bull$#@! about production falling when the hapless Venezuelans took over the facilities they paid dearly for goes, they're the 4th largest supplier to the US oil gobblers, up from the 5th largest, so I imagine the production isn't all that crumbling.

    One thing I'm sure of: Chavez didn't use the oil profits to illegally invade another country on trumped up premises to steal it's resources and kill a million of it's citizens.

    They've tried to assassinate him, plotted and executed a failed coup and demonized him in the press. Now they're manipulating the oil price to squeeze Venezuela, Iran, Russia and anyone else who attempts to make oil a free market, into submission.

    I don't give a $#@! what else the guy did or will do. He kicked the criminals out and paid the loans in full, and so far has kept his scalp, which no one else has been able to do...ever.

    Bosso

  21. #18
    Quote Originally Posted by Mini-Me View Post
    It's amazing that "rulers" never seem to learn from history. Hasn't the whole "price controls always lead to shortages" thing been known since, um...ancient Egyptian times? (I'm completely not joking...actually, we've known it for longer. We have known that price controls cause shortages SINCE THE DAYS OF THE BABYLONIAN EMPIRE AND HAMMURABI, and people are still making the same stupid mistakes!)
    We can't assume the rulers want what's best for the people.

  22. #19
    Quote Originally Posted by Bossobass View Post
    Nothing like gobbling down a barrel of propaganda.

    Those Corporations don't invest a dime when they move in to exploit a country's resources. They have the government borrow the money from the IMF to upgrade infrastructure and build production facilities. The work is done by the Carlyle Group, Bechtel, Halliburton, etc. Then the "royalties" of 5% go to the puppets who agree to burden the people of that country with the debt.

    The whole deal is prearranged and extremely overpriced in favor of the bank and the corporations. The people get nothing but debt.

    Chavez kicked Exxon the $#@! out which enabled venezuela to pay the IMF loans in full in '07.

    Otherwise, like America, Venezuela would never...never have gotten out from under that debt.

    As far as the bull$#@! about production falling when the hapless Venezuelans took over the facilities they paid dearly for goes, they're the 4th largest supplier to the US oil gobblers, up from the 5th largest, so I imagine the production isn't all that crumbling.

    One thing I'm sure of: Chavez didn't use the oil profits to illegally invade another country on trumped up premises to steal it's resources and kill a million of it's citizens.

    They've tried to assassinate him, plotted and executed a failed coup and demonized him in the press. Now they're manipulating the oil price to squeeze Venezuela, Iran, Russia and anyone else who attempts to make oil a free market, into submission.

    I don't give a $#@! what else the guy did or will do. He kicked the criminals out and paid the loans in full, and so far has kept his scalp, which no one else has been able to do...ever.

    Bosso
    He's a communist moron who is driving his country into the $#@!ter.

  23. #20
    Quote Originally Posted by LibertyBrews View Post
    He's a communist moron who is driving his country into the $#@!ter.
    Well that sure was well thought out and insightful. How can you possibly wear a hat with that big huge brain of yours.
    What boss explained is the same formula that's been done on other countries (Argentina is another one...look what happened there) to get globalist control of a nation's resources, while the citizens pay for it and ultimately suffer. Chavez may not be an ideal leader, as a socialist/communist, but there's so much BS propaganda about him it's not even funny.
    Last edited by devil21; 03-02-2009 at 09:39 PM.
    "Let it not be said that we did nothing."-Ron Paul

    "We have set them on the hobby-horse of an idea about the absorption of individuality by the symbolic unit of COLLECTIVISM. They have never yet and they never will have the sense to reflect that this hobby-horse is a manifest violation of the most important law of nature, which has established from the very creation of the world one unit unlike another and precisely for the purpose of instituting individuality."- A Quote From Some Old Book

  24. #21
    Quote Originally Posted by Bossobass View Post
    Nothing like gobbling down a barrel of propaganda.


    As far as the bull$#@! about production falling when the hapless Venezuelans took over the facilities they paid dearly for goes, they're the 4th largest supplier to the US oil gobblers, up from the 5th largest, so I imagine the production isn't all that crumbling.

    Bosso
    I guess you did not read the last line that I quoted which says production is off by 26% from what it was in 1997. That is a pretty big decline. And the first line about exports being down 42%. Those figures come from international oil analysts- not any government. They are questioning the (Venezuelan) government figures as being too rosy.

    A bit more information:
    Investment in Maintaining/Expanding Production

    Industry analysts estimate that PdVSA must spend some $3 billion each year just to maintain production levels at existing fields, as many of these fields suffer annual decline rates of at least 25 percent. Affecting PdVSA’s ability to meet its investment goals are the increasing demands placed upon its finances by the Venezuelan government. The company spends billions of dollars per year on social spending and other non-oil investments, including the financing of infrastructure projects, direct operation of social programs, and taxes, royalties, and other transfers to the government.
    Foreign Operators

    In the 1990s, Venezuela opened its upstream oil sector to private investment. This collection of policies, called apertura, facilitated the creation of 32 operating service agreements (OSA) with 22 separate foreign oil companies, including international oil majors and small independents. Under these contracts, companies operated oil fields, and PdVSA paid these companies a fee and purchased the produced crude at a price pegged to market rates. PdVSA also offered eight blocks under risk/profit sharing agreements (RPSA), under which PdVSA had an option to purchase up to a 35 percent equity stake in the project if the foreign operator discovered commercial quantities of oil in the exploration phase. Finally, Venezuela established four “strategic associations” that produce extra-heavy crude, in which PdVSA held a financial interest.

    In the last 10 years, Venezuela has moved to largely undo most of the aperturainitiatives, including mandating PdVSA majority ownership of all oil projects and increasing tax and royalty rates on new and existing projects. The efforts culminated with the 2007 transition of the four extra-heavy strategic associations to new structures with PdVSA majority ownership. Of the six companies involved in the projects, two reduced their holdings to allow space for the enlarged PdVSA share (Total and Statoil), two maintained their previous stakes (Chevron, BP), and two exited completely from the projects (ConocoPhillips and ExxonMobil). Recent attempts by Venezuela to attract foreign investment to the oil sector have focused on foreign national oil companies (NOCs), including those from China, India, Iran, and Russia.
    http://www.eia.doe.gov/cabs/Venezuela/Oil.html

  25. #22
    Quote Originally Posted by Bossobass View Post
    Nothing like gobbling down a barrel of propaganda.

    Those Corporations don't invest a dime when they move in to exploit a country's resources. They have the government borrow the money from the IMF to upgrade infrastructure and build production facilities. The work is done by the Carlyle Group, Bechtel, Halliburton, etc. Then the "royalties" of 5% go to the puppets who agree to burden the people of that country with the debt.

    The whole deal is prearranged and extremely overpriced in favor of the bank and the corporations. The people get nothing but debt.

    Chavez kicked Exxon the $#@! out which enabled venezuela to pay the IMF loans in full in '07.

    Otherwise, like America, Venezuela would never...never have gotten out from under that debt.

    As far as the bull$#@! about production falling when the hapless Venezuelans took over the facilities they paid dearly for goes, they're the 4th largest supplier to the US oil gobblers, up from the 5th largest, so I imagine the production isn't all that crumbling.

    One thing I'm sure of: Chavez didn't use the oil profits to illegally invade another country on trumped up premises to steal it's resources and kill a million of it's citizens.

    They've tried to assassinate him, plotted and executed a failed coup and demonized him in the press. Now they're manipulating the oil price to squeeze Venezuela, Iran, Russia and anyone else who attempts to make oil a free market, into submission.

    I don't give a $#@! what else the guy did or will do. He kicked the criminals out and paid the loans in full, and so far has kept his scalp, which no one else has been able to do...ever.

    Bosso
    love this! thumbs up!
    In matters of style, swim with the current; in matters of principle, stand like a rock.-- Thomas Jefferson

  26. #23
    Yeah, what a true symbol of liberty and freedom he is changing the law so he can become president as long he wishes to serve his own selfserving image. I admit though he is a slick piece of #¤¤#. Kind of like Obama.

  27. #24
    Quote Originally Posted by Mini-Me View Post
    It's amazing that "rulers" never seem to learn from history. Hasn't the whole "price controls always lead to shortages" thing been known since, um...ancient Egyptian times? (I'm completely not joking...actually, we've known it for longer. We have known that price controls cause shortages SINCE THE DAYS OF THE BABYLONIAN EMPIRE AND HAMMURABI, and people are still making the same stupid mistakes!)
    The human race is one sorry excuse for evolution. If i were an advanced alien race i would not even bother to stop by here for another 100,000 years.

    Per
    Deus
    Mos



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  29. #25
    Chavez is just another socialist piece of $#@! that's not unlike the other major dictators/socialist pieces of $#@! in the history of South America.

  30. #26
    Quote Originally Posted by the count View Post
    The human race is one sorry excuse for evolution. If i were an advanced alien race i would not even bother to stop by here for another 100,000 years.
    When you think about it, most of the human faults: green, corruption, jealousy come from our basic animal instincts. Just watch nature and see if there is any humility, forgiveness in animals. We have just recently began to emphasis our humanity.

    I doubt any civilized and advanced extra terrestrial society was able to skip over these issues. They were probably built with the very same faults as we are.

    For our current state of mind and development, individual liberty is what maximizes our potential to be good. Collectivism so far has always led to corruption, misuse. One could infer that collectivism feeds our faults, not mention that it makes us as a society vulnerable to the few that know how to exploit the system to their advantage. We even have names for these things "mob rule".
    Cheers,
    mark...




  31. #27
    Quote Originally Posted by voytechs View Post
    For our current state of mind and development, individual liberty is what maximizes our potential to be good. Collectivism so far has always led to corruption, misuse. One could infer that collectivism feeds our faults, not mention that it makes us as a society vulnerable to the few that know how to exploit the system to their advantage. We even have names for these things "mob rule".
    Collectivism has not led to corruption and misuse. Collectivism is build to be able to be corrupt. When a small number of adults tells the rest of the adults to give up their control and their means of production to them, on the promise that they will treat them good, sounds like a scam. And you know why? Because it is a scam.

    Hugo



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