Posted on 01/31/2014 1:18:12 PM PST by blam
Venezuela And Argentina: The Party Is Over
Latin America’s weakest economies are reaching breaking-point
The Economist
Feb 1st 2014
WHEN the euro crisis was at its height it became commonplace for struggling European economies to insist that they were not outliers like Greece. Whatever their woes, they declared, Greece’s were in a class of their own. In Latin America, by contrast, the unwanted title of outlier has two contenders: Argentina and Venezuela.
Both have been living high on the hog for years, blithely dishing out the proceeds of an unrepeatable commodities boom (oil in Venezuela; soya in Argentina). Both have been using a mix of central-bank interventions and administrative controls to keep overvalued exchange rates from falling and inflation from rising. Both now face a come-uppance.
High inflation is a shared problem. Argentina’s rate, propelled higher by loose monetary and fiscal policies, is unofficially put at 28%. Argentina’s official exchange rate is overvalued as a result, fetching 70% more dollars per peso than the informal “blue” rate in mid-January. Venezuela’s prices are rising faster still. Last year, during an awkward political transition after the death of Hugo Chávez to the presidency of Nicolás Maduro, the Central Bank stepped up money-printing to finance public spending, pushing inflation to 56.2%. A dollar fetches 75-80 bolívares on the black market, up to seven times the official rate.
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(Excerpt) Read more at economist.com ...
What do both of these countries have in common: Socialist/Marxism.
“...using a mix of central-bank interventions and administrative controls...stepped up money-printing to finance public spending...”
Gee, sounds familiar.
The sad thing is that the United States has emulated BOTH Venezuela AND Argentina. I see a bad moon arisin....
I see the same government capital controls, “one-time” taxes, forced property sales, and outright confiscation coming to the USA.
En Argentina y Venezuela la mierda golpea el ventilador!
Don’t Cry For Me Argentuna!
socialism fails again. Someday maybe the right people will make it work.
(It won’t ever happen)
How many times now has Argentina been taught but apparently not learned this some lesson about socialism - fascism - Marxism? Venezuela has lived in a failed economy/society for several years but Hugo is the secular saint?
We can’t talk as we are circling the drain ourselves and should but don’t know better.
They’ll be fine. All they need is more government involvement.
I also see Maduro in Cuba. He is probably making sure one of his Generales isn't promising more oil to Castro in exchange all the Cuban officers embedded in Venezuela's military supporting a coup.
I lived in Venezuala for several years. Most of them are good people. It is sad,
Prepares’ PING!!
Oh...this time it'll be different!
It can't be that bad. At least bankers aren't committing suicide in alarming numbers.... oh... wait...
/johnny
Yep, we just need new people in charge, Comrade. lol
(Ahem)
/johnny
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