Posted on 12/16/2016 7:29:07 AM PST by PJ-Comix
Venezuela's highest denomination banknote has ceased to be legal tender, in a move that has caused cash chaos and long queues at banks this week.
Some cash machines on Thursday were still issuing the old 100-bolivar notes, hours before they expired.
President Nicolas Maduro said new higher-denomination bills would be fully distributed in January.
(Excerpt) Read more at bbc.com ...
can someone explain to me how these phenomenal losses in a country’s currency value happen. I know it must have something to do with Communism. I think it does.
Even the new 500 Bolivar note is only worth about 15 cents NOW. Within a few weeks it could be worth less than a dime. Is it even worth printing? And which printer would be so stupid as to accept near worthless Bolivars for payment?
Economics.....
Too many Bolivars chasing too few goods
MADURO: Okay, print me up a million worthless 500 Bolivar notes and I will pay you that.
Of course not. It’s bad luck.
Waiting for the Hollywood and LEFTIST supporters of the Chavez-Maduro to drop in with U$D support for the non-government segment of the population.
waiting ... waiting ... [crickets!]
One thing the Left around the world has in common is that they always blame their failures on malevolent outside forces. Here it’s Russian hackers. In Venezuela it’s the US or mysterious mafias.
Can I buy Venezuela?
Bush’s fault, soon to be Trump’s fault. In the meantime It’s America’s fault. Or the California fault.
Feel the Bern.
“The only entity which can take a valuable commodity like paper and make it worthless by adding ink is government.” Milton Friedman
If they had any toilet paper it would be worth more than Bolivars.....
.... But they don’t have any toilet paper.
They can always stamp new denominations diagonally across the bills.
Hundreds to thousands, thousands to millions, millions to billions... Remove zeros and repeat as necessary...it will all work out...
Complex but almost completely self-created by the Bolivarian misrule by the Chavez-Maduro oligarchy. First, there is the external factor of an overestimate (WILD!) of the expected average sales price of Venezuela's oil. What minimal attention to functional budgeting by the government was wildly skewed by the stubborn refusal of the outside world to purchase the heavy crude oil (limited to specific refineries for efficient usage) at costs of $125+/barrel.
So, with the income side severely underperforming, one would expect, assuming a competent government, a corresponding decrease in spending. That expectation never materialized, but instead spending continued and in many areas increased.
As is a basic characteristic of socialist/communist governments, most of the spending was used to subsidize an ever increasing poverty class and law-enforcement & military, that sector being the ones having the guns. Of course, added to that spending was the siphon effect that has led to making the families of Chavez-Maduro oligarchy very wealthy.
So you have the socialism that discourages and destroys an ever shrinking private sector economy and that creates the falling dominos that moves former wealth creators to the subsidized poverty classes and in turn imposes a tremendous cost on the overall economy in terms of time-waste for normal commodities. This has become a downward spiral that does not appear to have a non-violent solution.
A this point, I think using exponential notation might be a better choice!
Where is Maduro getting the money to pay for the new bills?
Last year he didn’t have funds to pay for printing of the bills he’s recalling. Maybe he’s trading toys for money.
Maybe that’s why they’re calling in and demonetizing the old notes. Call them all in, run them through a local printing press with a couple of extra zeros added and presto you’ve got the “higher value” bills without having to pay a foreign printer who expects to get paid in real money.
The Weimar government can give 'em some clues. This German 1922 1,000 mark note was overstamped 1,000,000: 
On another note (no pun intended) after Pearl Harbor, the government was afraid the Japanese would capture Hawaii, so by the middle of 1942 they had all citizens there turn in their money for these new bills ($5, $10, $20). 
That way, if the Japanese did succeed, the U.S. could immediately declare this money invalid. (I remember seeing some of these bills when I was a kid, and wondered why the govt was putting a territory on the money - thinking they were also going to do it for Alaska.)
And then we have this: 
My wife worked in a bank in the Florida Panhandle in the '90s and when the queers would have their conventions, or whatever there, the area would be flooded with these bills. The bank instructed the clerks to treat them as damaged bills and return them to the Fed for destruction.
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