Caracas-sangrante-1996

“¡Aquí fue!”

“I haven’t had tenderloin in two years.” I’m having lunch with Leticia and her husband Gonzalo in an upscale Santiago beef restaurant. I don’t know them very well, but they are friends of a good friend, so I invited them out to show them the city. They live in Caracas, passing through Santiago because Gonzalo, a mid-level manager…

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Where have all the dollars gone?

Reading the Venezuelan press, it’s easy to forget this is a petro-state, and that the barrel of oil is selling at prices close to its historic high. Just today, we found out that airlines can say goodbye to repatriating their profits at the agreed-upon rate, as expected; scarcity of basic staples has shot up to 60%, as…

panini album

PANINI-nomics in Venezuela

Over the past two weeks, Venezuelans have poured into the streets, but not simply to protest. Throngs are desperately trying to get the officially licensed sticker albums of this year’s FIFA World Cup from Panini. Every four years, soccer fans the world over buy the officially licensed Panini sticker album in order to get a glimpse of which of their favorite football…

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On a wing and a prayer

The ongoing saga between international airlines and the Venezuelan government continues. Just when you thought airlines were going to get their money, the government is now suggesting they will only get paid in part, and at a much higher rate than previously thought. According to El Mundo, the government is playing hard ball as usual,…

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The eight-hundred-and-seventeen-car-per-month economy

Our friends over at the Latin American Herald Tribune have an alarming article on Venezuela’s squalid car market. GM has written down $400 million from its books, courtesy of Maduro’s “non-devaluation,” which wiped out their profits for the entire sub-continent … and then some. Ford also saw their profits in the region wiped out by the government’s…

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SICAD II: Lost in Translation

Confused about SICAD II? Wondering whether the new currency exchange system really is a legal, market-based alternative to the black-market, or whether it just plays one on TV? Don’t worry, you’re not the alone: Nicolás Maduro himself seems to conflicted on the question to the point of schizophrenia. In his New York Times OpEd, he describes SICAD II as…

The bit they don't show the tourists

The Petrocaribe Trap

A guest post by Alexis Caraballo, who makes her living as a Caribbean regional analyst. A failing economy, where everything for sale in the shops is imported, with dwindling foreign reserves and on the brink devaluation. Sound familiar? It does to folks in Jamaica, a country that breaks records not just in the 100-meter dash (9.58 seconds) but also in debt-to-GDP ratio (139%)…

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Suggesting change may be as relevant as change itself

Over at Foreign Policy’s Transitions blog, I take a less pessimistic approach to SICAD II than Quico. The value added: “The new system is also much more transparent. The Central Bank will, supposedly, allow transaction prices to be set by market forces, and will publish the average exchange rate every day. There are pledges that transactions…

well_bolivar

A Caracas City Shuffle

Venezuela’s government is about to unleash the biggest economic reform set forth in the last 11 years. A currency market is about to be set in place, with far fewer restrictions than the previous systems. This reform is a step back from the toxic policy of exchange control, and it is exactly 11 years late. The…

Carpeta Cadivi

The Cadivi Barricades

Quico Toro, the founder of this blog, wrote an OpEd for yesterday’s New York Times in which he ponders the reasons for the massive protests currently rocking Venezuela. His theory is that the protests are in defense of the right to free assembly. There may be some truth to that. However, I think we are…