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| arithmetical error? |
The thing is that through the Carnival holiday people have been screaming at the devaluation but for all the wrong reasons. Well, not all, mercifully there were enough people left at home to make some sense, but the fact of the matter is that the reaction of most people is indeed thatthey are worrying about their CADIVI bonus to go on vacation. Idiots! It plays straight into the hands of the regime, who wants to project the image of spoiled rich escualidos bitching because their vacations are going to be a tad more expensive, 31,74% more expensive to be exact. And still dirt cheap as I explained before.
For example, the picture that I put above is circulating on Internet. It is intended as humor but it is misleading on at least two accounts. It intends to represent the value today of a 100 banknote, now with the color of a 50 banknote. But the way one would read it at first is a "reevaluation of the currency", that is, now you need only 53,50 to buy 12,44 USD compared to the previous 100! In fact the depreciation of the currency is 31,75% which means the numbers in the banknote should read 68,25. But dramatization is always good so it is better to use the 2 over 4,3 ration than the sounder 2 over 6,3 which is the economical reality of accounting books even though the pain feels certainly worse than the 2 over 4,3 ratio.
Idiot and mean and corrupt Giordani certainly does not miss that bit. In an interview he gave to a chavista journalist that writes a terrible humor column in El Universal, he speaks about all those spoiled brats that scream about the devaluation while that one was needed to preserve the economic health of "el pueblo" . That none of his arguments stand criticism even from a non-economist like me is not the point. That he looks like a jurassic park economist a few days before extinction is of no concern for him, nor does he notice in his arrogance. The point is to blame anyone but himself for the devaluation and it works, at least up to a point in the chavista hoi polloi.
Let's not forget one thing: since 1999 Giordani has been in charge of the macro economy of Venezuela for at least 85% of the time (he left for few months twice, curiously to have two devaluations taken by other people who had nothing to do with those ones). So, how does that measure up?
In February 1999 when Chavez was sworn to office the bolivar was 573,88, or 0,58 in current terms.
As of today the bolivar is 6,3 to the dollar.
The depreciation of the money has been (6,3 - 0,58)/6,3 = 90,79%
In other words, any property that Venezuelans held in 1999 has lost 90,79% of its value on paper (thank God for inflation to recover some of that!). In other words, your house, your business, your paycheck is worth roughly 10% what it was worth in February 1999....
This is what should be told to people, to make Chavez responsible, and his team, for the continuous devaluation. It is time the main voices of the opposition take a large view of the chavista disaster instead of trying to leave him as a sickly poor semi god and try to win next election by putting the blame on second string players. In fact, it should be said with all courage that we applaud the devaluation as it should have been done earlier but that we place all the blame for that measure on Giordani and Chavez. Instead the oppo prefers to play #paquetazorojo (of which I admit in shame, I played a little bit at first, avoiding # in twitter as the plague...).
Oh well, another missed opportunity for the opposition. We will need to wait for people to go hungry before they finally realize how wrongly led the country has been for the last 14 years. One side does not want to listen and the other one is unwilling to talk straight anyway.