Caracas Chronicles

Photo: Roberto White (@robertomayota), retrieved

I’m at a busy street in Unare’s municipal market, waiting to pay for my queso blanco, and I have a gazillion things to do: buy chicken and endure the long line that comes with it, find bread and, most importantly, track down a frickin’ deodorant before the municipal market closes at midday. I probably won’t have enough time, because the line to pay is frozen. The point-of-sale is broken again, and nobody can check out until the fucking thing restarts. You may be a millionaire but, since you have no cash, you’re subjected to the cruel gods of Venezuelan connections. Forget about your other errands, son.

I didn’t bother to ask the price: a line this big means it’s affordable. I have reference, because I just saw this cheese down the street at Bs.150,000 per kilo.

Getting closer to the goal, I ask:

“What’s the price of the cheese?”

“It’s 240, mi amor.”

“Wait, really?” she flinches at my immediate shock. “I just saw it at 150,000 around the corner!”

“That’s the the price in cash” she says.

I should have known. One of the easier-to-miss impacts of our hyperinflation is that there’s not enough cash around. The government, as always, is unprepared and its response, wholly inadequate. It printed higher denomination bills too little and too late, and, at any rate, the out-of-control speed at which prices rise means the higher denominations just aren’t big enough. The Bs.100,000 bill (largest denomination there is), is worth less than 50 cents as I write this – probably much less by the time you read it.

You’d think people would immediately ditch the slow line and run to the cheaper cash seller. Well, nobody has cash, ever. We’re all shit out of luck.

Gold at these towns is sold in bolivars, cash or dollars. Right now, just a gram is worth Bs. 2,500,000. Five thousand 500 bolivars bills

The cash drought is hitting throughout the country, but it’s worse here in Guayana. In the street markets of San Félix, or Unare, it’s now standard to see products sold with three different prices: cheapest for the new, higher-denomination bills, expensive if you pay with cards, and exploitative for 100 or 50 bills (if they’re accepted at all).

According to the government, there are enough banknotes in circulation, but the border mafias and the private market extract and retain them to sell with a markup. It’s cash bachaqueo, and it’s shocking to see how many people buy the lame excuses chavismo comes up with.

The black market exists (and it’s crazy-big, yes) but truth is that money is scarce, and markets simply adapt. Prices vary a lot between locations following a simple rule: the more useful and scarce the money is, the more valuable it gets.

In big cities like Caracas or Ciudad Guayana, many stores have point-of-sale – el punto, in the parlance of our times. Those that don’t, might accept bank transfers. In a big city, the cash drought is an inconvenience, but it’s manageable. You still have banks, and if you spend all week standing in line, you may get some cash the normal way.

It’s down the rural path that reality bites. Many small towns have spotty or no electricity, no internet, no bank branches and, in some cases, not even cell phone service. In rural Venezuela, cash is not an option, it’s the only option.

And if that remote land is a mining town at the south of Bolívar state, where people save in gold (worth hundreds and sometimes thousands of dollars), it’s the perfect storm.

Gold at these towns is sold in bolivars, cash or dollars. Right now, just a gram is worth Bs. 2,500,000. Five thousand 500 bolivars bills – and they don’t transact one gram at a time, that’s just a tiny rock.

According to Mr. Castro, a construction worker at El Callao, everyone buys gold. It holds its value, unlike bolivars, and can be sold either in Brazil for dollars, or in Puerto Ordaz for way more profit.

It’s now standard to see products sold with three different prices: cheapest for the new, higher-denomination bills, expensive if you pay with cards, and exploitative for 100 or 50 bills (if they’re accepted at all).

El Callao is one of the most developed mining towns (it even has three banks!), but getting a significant amount of cash is a nightmare. Mr. Castro says that anyone with cash may sell it to you: “Today, January 20th, for a Bs. 100,000 bill you get Bs. 210,000 in bank transfer.”

Cash is so valuable that, even though prices are many times higher than in Ciudad Guayana, it’s ultra cheaper if you pay in cash. A kilo of rice goes for Bs. 200,000 in debit, but only Bs. 40,000 in banknotes.

“You may have money in the bank,” Mr. Castro says “but without cash, you can’t eat that day. I charge my work half in bank transfers and half in cash, gold or silver. That’s how I’ll buy food later.”

El Callao has many puntos, but most don’t work. Mr. Castro suspects the merchants damage them on purpose, so they can sell in cash only.

No wonder people are willing to pay top dollar for their cash. Now that word has spread, cash became the latest thing you can exploit. In Puerto Ordaz’ bus terminal, you can only pay in cash, but who has Bs. 100,000 in a wallet? Drivers tell you where you can go (inside the same terminal, mind you) to get cash at a 100% rate – we can all agree that ticket sellers won’t be taking your cards any time soon.

In the city, products that used to be easily affordable are becoming cash-only too. Back in December, sodas disappeared from most stores, to reappear on Christmas Eve at street vendors’ stands that only accepted cash.

The lines at the banks have gone up to eleven, too. Everyone wants to sell the cash, or at least buy cheaper stuff with it, particularly the pensioners, since they’re not working and have a big incentive to spend their whole day at the bank for a bunch of bills that are worth nothing.

Everything is a business. Taking money out of your account is time consuming, and well-connected people at the banks have started to sell cash. Moving those mountains of bills to the mining town, Lilian Tintori’s brother-style, is a business, too. And, of course, so is managing the many guard checkpoints throughout the route.

Chavismo creates problems and leaves us to come up with the solutions. Just how bad you want cash in your wallet?