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Getbig Main Boards => Politics and Political Issues Board => Topic started by: loco on March 26, 2014, 01:40:53 PM
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Venezuela’s new, legal currency market, the Sicad II foreign exchange platform, was supposed to curb the country’s appetite for illegal US dollars, but so far, it seems to be doing just the opposite. The rate for buying black market US dollars fell from nearly 90 bolivars to the dollar to about 58 over the past month, but it has jumped by almost 40% since the new way to buy greenbacks was launched yesterday morning.
(http://qzprod.files.wordpress.com/2014/03/how-much-it-costs-to-buy-1-in-venezuela-official-rate-black-market-rate_chartbuilder-1.png?w=1024&h=575)
Buying US dollars in Venezuela is actually fairly complicated. There are at least four different official rates (pdf): one for exchanging money to be used while traveling abroad; another for corporations; another, using the new currency market, for individuals hoping to save using US dollars; and then the country’s official rate, which is used for essential imports, and over 85% of the country’s foreign exchange needs.
It’s the fifth rate—the black market rate—for US dollars that’s most important to monitor, since it’s the best indicator of what Venezuelans actually think their currency is worth. The falling black market rate in the last month indicates some excitement about the launch of the new currency market, but that excitement seems to have run dry, perhaps because the trade hasn’t been as free as expected.
“The only way to make the black market disappear is to allow free legal trading in dollars,” Henkel Garcia, director of Caracas-based consultancy Econometrica, told Bloomberg. “It appears the government is placing some restrictions on the operation of the new platform, which is fueling demand for the black dollar again.”
Allowing locals to buy US dollars at will is easier said than done in Venezuela, because the country is running dangerously low on American currency. The country’s international reserves have tumbled from nearly $35 billion in 2009 to barely $20 billion today (for comparison, Colombia has nearly $45 billion).
(http://qzprod.files.wordpress.com/2014/03/venezuela-international-reserves-reserves_chartbuilder.png?w=1024&h=576)
The scarcity of dollars in Venezuela has both led to and exacerbated a number of problems, including sporadic hyperinflation, rampant basic goods shortages, and even the withholding of billion of dollars from international airlines.
http://qz.com/192395/venezuelas-black-market-rate-for-us-dollars-just-jumped-by-almost-40/#/h/56866,1/
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Venezuela’s new, legal currency market, the Sicad II foreign exchange platform, was supposed to curb the country’s appetite for illegal US dollars, but so far, it seems to be doing just the opposite. The rate for buying black market US dollars fell from nearly 90 bolivars to the dollar to about 58 over the past month, but it has jumped by almost 40% since the new way to buy greenbacks was launched yesterday morning.
(http://qzprod.files.wordpress.com/2014/03/how-much-it-costs-to-buy-1-in-venezuela-official-rate-black-market-rate_chartbuilder-1.png?w=1024&h=575)
Buying US dollars in Venezuela is actually fairly complicated. There are at least four different official rates (pdf): one for exchanging money to be used while traveling abroad; another for corporations; another, using the new currency market, for individuals hoping to save using US dollars; and then the country’s official rate, which is used for essential imports, and over 85% of the country’s foreign exchange needs.
It’s the fifth rate—the black market rate—for US dollars that’s most important to monitor, since it’s the best indicator of what Venezuelans actually think their currency is worth. The falling black market rate in the last month indicates some excitement about the launch of the new currency market, but that excitement seems to have run dry, perhaps because the trade hasn’t been as free as expected.
“The only way to make the black market disappear is to allow free legal trading in dollars,” Henkel Garcia, director of Caracas-based consultancy Econometrica, told Bloomberg. “It appears the government is placing some restrictions on the operation of the new platform, which is fueling demand for the black dollar again.”
Allowing locals to buy US dollars at will is easier said than done in Venezuela, because the country is running dangerously low on American currency. The country’s international reserves have tumbled from nearly $35 billion in 2009 to barely $20 billion today (for comparison, Colombia has nearly $45 billion).
(http://qzprod.files.wordpress.com/2014/03/venezuela-international-reserves-reserves_chartbuilder.png?w=1024&h=576)
The scarcity of dollars in Venezuela has both led to and exacerbated a number of problems, including sporadic hyperinflation, rampant basic goods shortages, and even the withholding of billion of dollars from international airlines.
http://qz.com/192395/venezuelas-black-market-rate-for-us-dollars-just-jumped-by-almost-40/#/h/56866,1/
The bottom line is they devalued the currency 50% overnight. When everything goes up by 50% there'll be increased demand. It's like anything else we've seen. Back in 2010 when they dumped all that gold on the market, India scooped it all up. These days the same thing happens every time they dump gold, China buys it all up and we see increased demand. It will continue to no abatement because the bolivar is worthless. People are going to want to trade it ASAP.
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blah blah blah
how do i make money on this shit
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blah blah blah
how do i make money on this shit
haha
That's what I was thinking as I reached the fourth sentence of the first post. ;D
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racist post reported
I forgot I wasnt in the G&O
and there is nothing racist about it btw.
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Allowing locals to buy US dollars at will is easier said than done in Venezuela, because the country is running dangerously low on American currency. The country’s international reserves have tumbled from nearly $35 billion in 2009 to barely $20 billion today (for comparison, Colombia has nearly $45 billion).
(http://qzprod.files.wordpress.com/2014/03/venezuela-international-reserves-reserves_chartbuilder.png?w=1024&h=576)
The scarcity of dollars in Venezuela has both led to and exacerbated a number of problems, including sporadic hyperinflation, rampant basic goods shortages, and even the withholding of billion of dollars from international airlines.
http://qz.com/192395/venezuelas-black-market-rate-for-us-dollars-just-jumped-by-almost-40/#/h/56866,1/
Maybe Yellen could take all that paper that her & Bernanke have been dropping from helicopters, ...and drop it in Venezuela. Too many $$$ in America, not enough in Venezuela. They could feed 2 birds with 1 worm :D
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blah blah blah
how do i make money on this shit
Trade with Venezuelan locals, US dollars for gold, for silver, for diamonds, etc.? I don't really know. :)