Venezuela Planning New 100,000-Bolivar Bills Worth Just $0.23

[TravelMug]

Venezuela Planning New 100,000-Bolivar Bills Worth Just $0.23

Venezuela has begun to import banknote paper and is mulling plans to print bills with larger denominations as hyperinflation causes shortages of cash, according to six people with knowledge of the matter.

The country has brought in about 71 tons of security paper this year from an Italian printer majority owned by the private equity firm Bain Capital, according to some of the people and data reviewed by Bloomberg from Import Genius, which compiles customs records it obtains through private sources. The central bank is considering new bills starting with 100,000 bolivars, the people said. It would be the highest denomination yet, but still worth only $0.23.

https://www.bloomberg.com/news/articles/2020-10-05/venezuela-planning-new-100-000-bolivar-bills-worth-just-0-23

So spending fiat to produce more fiat, how ironic it is. It's just sad how this rich oil nation turn into another sad story because of the mismanagement from the sitting President.

And what's next $1 million Bolivar Bills just worth a dollar?

And it makes sense the Venezuelan are into bitcoin, with record breaking transactions like everyday.



https://twitter.com/BCV_ORG_VE/status/1314308916143104006

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[JakobFugger]

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

[abhiseshakana]

The money printing strategy to stabilize economic conditions will not work in Venezuela, this is because money printing is not balanced with increased production, money printing is only to increase demand and for consumption.  The economic tragedy in Venezuela was caused by a series of adverse events including the drop in oil prices, a total economic embargo by America and the high level of economic dependence on oil exports and imports for public consumption.  From this, it can be seen that without trade diversification, the level of a country's sovereignty will be lower.

[Lorence.xD]

This is what happens when you invest your country's fund into individual wants of your citizens and not on general welfare or anything that will benefit more in the long run. Add the corruption from the time of Maduro, the irregularities of election. You know that it is a recipe for disaster when the government is paranoid about the security of their leader because even if they do not admit or blatantly deny it, they have secrets that they want to be hidden. Zimbabwe is a good example of what happens when the leader is incapable and corrupt.

[Poker Player]

The money printing strategy to stabilize economic conditions will not work in Venezuela, this is because money printing is not balanced with increased production, money printing is only to increase demand and for consumption.  The economic tragedy in Venezuela was caused by a series of adverse events including the drop in oil prices, a total economic embargo by America and the high level of economic dependence on oil exports and imports for public consumption.  From this, it can be seen that without trade diversification, the level of a country's sovereignty will be lower.

What? The economic tragedy in Venezuela has been caused by the communists who rule the country.

No. It has not been an unfortunate sequence of events. What has happened in all communist countries has happened in Venezuela: that the rulers are increasingly rich, at the cost of killing the population with hunger.

The problem is that the rulers have cut off all private initiative and with this, productive activity has been reduced to a minimum.

[btc_angela]

The money printing strategy to stabilize economic conditions will not work in Venezuela, this is because money printing is not balanced with increased production, money printing is only to increase demand and for consumption.  The economic tragedy in Venezuela was caused by a series of adverse events including the drop in oil prices, a total economic embargo by America and the high level of economic dependence on oil exports and imports for public consumption.  From this, it can be seen that without trade diversification, the level of a country's sovereignty will be lower.

Right, but they didn't learn from past history, they still live on the mentality of a old guard, the last stronghold of communism - Maduro. To be fair, even US has been printing to offset the balance of their economy, unemployment because of the covid-19 pandemic. The economic tragedy was really brought up by the communist regime and as a result, trade embargo from the West was imposed. And yes, Venezuelans is surviving because of bitcoin, Venezuela's Bitcoin Use Soars Amid Hyperinflation: 3rd on Global Crypto Adoption Index.

[Hydrogen]

Venezuela has begun to import banknote paper

The country has brought in about 71 tons of security paper this year from an Italian printer majority owned by the private equity firm Bain Capital

Bolded above highlights some of venezuela's issues.

They import 71 tons of security paper, due to their nation lacking the expertise, productive capacity and industry to make it themselves. Their economy is a giant trade deficit where they produce little or nothing. This places them in a disadvantaged position of trade, making them extremely reliant on foreign imports.

This becomes evident by recent history. The hydroelectric dam in caracas which previously generated free electricity many utilized to mine bitcoin has experienced technical issues. No one in the country appears to be up to the task of maintaining or fixing whatever is broken on the dam. And so standard of living inevitably declines. This negative analogy applies across the board to venezuela's previously rich oil industry and all sectors of their economy.

[Darker45]

The money printing strategy to stabilize economic conditions will not work in Venezuela, this is because money printing is not balanced with increased production, money printing is only to increase demand and for consumption.  The economic tragedy in Venezuela was caused by a series of adverse events including the drop in oil prices, a total economic embargo by America and the high level of economic dependence on oil exports and imports for public consumption.  From this, it can be seen that without trade diversification, the level of a country's sovereignty will be lower.

What? The economic tragedy in Venezuela has been caused by the communists who rule the country.

No. It has not been an unfortunate sequence of events. What has happened in all communist countries has happened in Venezuela: that the rulers are increasingly rich, at the cost of killing the population with hunger.

The problem is that the rulers have cut off all private initiative and with this, productive activity has been reduced to a minimum.

There are many factors coming into play that caused Venezuela's downfall. I don't think this is just about the country's leaders nor their political ideology, not even corruption alone.

Of course this is also largely mismanagement as well as their dirty politics, but this oil-rich country is also suffering from the severe decrease in oil's price. And who would discount the economic sanctions harshly imposed on them by the powerful western countries led by the USA?

[TravelMug]

Venezuela has begun to import banknote paper

The country has brought in about 71 tons of security paper this year from an Italian printer majority owned by the private equity firm Bain Capital

Bolded above highlights some of venezuela's issues.

They import 71 tons of security paper, due to their nation lacking the expertise, productive capacity and industry to make it themselves. Their economy is a giant trade deficit where they produce little or nothing. This places them in a disadvantaged position of trade, making them extremely reliant on foreign imports.

This becomes evident by recent history. The hydroelectric dam in caracas which previously generated free electricity many utilized to mine bitcoin has experienced technical issues. No one in the country appears to be up to the task of maintaining or fixing whatever is broken on the dam. And so standard of living inevitably declines. This negative analogy applies across the board to venezuela's previously rich oil industry and all sectors of their economy.

Yeah, but the government has the audacity to import 71 tons of paper just to print paper money that will have no value at all. This should be at least the last resort of Venezuela, but I guess when the country is already in trade deficits and everything in the country is a messed, this will be the only one those sitting in the government thinks that will help their constituent, but it's not.

I'm not from Venezuela, but we have seen the destruction of the country, yes a country rich in oil turn into one of the worst economic downfall we have seen in decades and there not even a sight in the horizon that the country will recover because of the current administration.

[sunsilk]

The paper material that's used for printing their money is probably much costly and valuable than the equivalent of 100,000 Venezuelan Bolivar.

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

The government there is said to be corrupt but that doesn't mean in general that countries who printed more money in this times are also doing it for their personal interest. There were several stimulus that were done and it's needed to sustain the economy. But I agree that for Venezuela, with the existing hyperinflation, this won't do well yet will worsen the situation.

[Upgrade00]

Over dependency on one means of national revenue is a major problem, especially in corrupt countries with natural resources as the government pays little attention to other aspects of the economy.
I checked out top exports from Venezuela in 2019, and natural resources, including oil accounts for majority of it;.

1. Mineral fuels including oil: US$14.8 billion (89.9% of total exports)
2. Organic chemicals: $404.8 million (2.5%)
3. Iron, steel: $238.4 million (1.4%)
4. Fish: $236.7 million (1.4%)
5. Gems, precious metals: $120 million (0.7%)
6. Ores, slag, ash: $111 million (0.7%)
7. Aluminum: $78.1 million (0.5%)
8. Beverages, spirits, vinegar: $76.1 million (0.5%)
9. Copper: $56 million (0.3%)
10. Cocoa: $53.6 million (0.3%)
Source - http://www.worldstopexports.com/venezuelas-top-10-exports/

Ideally, also top on their list of imports for 2019 is mineral fuel (refined oil). We have the same issue in Nigeria where out nation which is one of the largest oil producing states does not have a stable means of refining its mineral fuel due to mismanagement, so we export and import our natural resource.

[bryant.coleman]

Anyone remember this?

The Venezuelan Bolivar will end up like Zimbabwe Dollar. Hardly anyone store their money as Bolivar in Venezuela. In most cases, US Dollar and gold is being used for this purpose. And I heard that Bitcoin usage is also going up there. Venezuela is a perfect example of how socialism can destroy a nation. And the joke is that we still have a lot of people who would still vote for Socialist politicians.

[abhiseshakana]

What? The economic tragedy in Venezuela has been caused by the communists who rule the country.

No. It has not been an unfortunate sequence of events. What has happened in all communist countries has happened in Venezuela: that the rulers are increasingly rich, at the cost of killing the population with hunger.

The problem is that the rulers have cut off all private initiative and with this, productive activity has been reduced to a minimum.

Do you remember the term control oil you control the nation, control the food you control people. Henry Kissinger's philosophy can illustrate what happened in Venezuela. It was foreign interference that caused the social and political situation and conditions in Venezuela to heat up. The US used every economic and diplomatic policy to weaken the regime and build an international coalition against the regime in power

Venezuela under Chavez pursues a policy of redistribution and social justice in a market scheme. Besides inheriting the spirit of communism, Chavez also has many loyal supporters, even in the clashes that occurred in 2014, most of the victims came from the Maduro camp, not the opposition. The main business powers that control Venezuela's private sector are supporting the opposition to sabotage the political agenda.

So the crisis in Venezuela is not due to socialism or communism, but because of the incomplete project of socialism which has made all social reforms fail to produce a change towards the control of a mode of production that can guarantee mutual prosperity. As a result, the social transformation to rid Venezuela from dependence on oil has not been successful. Meanwhile, the anti-Chavismo social forces, which had an economic base from the private sector, took advantage of this crisis to destroy the political project of Socialism.

Right, but they didn't learn from past history, they still live on the mentality of a old guard, the last stronghold of communism - Maduro. To be fair, even US has been printing to offset the balance of their economy, unemployment because of the covid-19 pandemic. The economic tragedy was really brought up by the communist regime and as a result, trade embargo from the West was imposed. And yes, Venezuelans is surviving because of bitcoin, Venezuela's Bitcoin Use Soars Amid Hyperinflation: 3rd on Global Crypto Adoption Index.

Venezuela people adopt bitcoin because of TINA (There is no alternative). They have a high dependence on the dollar and their money printing is not matched by an increase in the production sector which causes hyperinflation. Printing money is used for consumption, buying dollars so that they can import goods.

[Mauser]

This is so sad and will probably not help at all. They should be trying to fix their economy instead of printing new money. Who is actually going to use such a bill? I saw in a documentary about Venezuela that most stores are not accepting bolivar anymore as a means of payment. Most restaurants and stores only accept USD these. Around 70% of the families have atleast one family member living abroad send money, usually USD to Venezuela.

Venezuela has so many natural resources that the country should be flourishing with the right government. They need to eliminate corruption and make new economic reforms to get back on track.

[Poker Player]

So the crisis in Venezuela is not due to socialism or communism, but because of the incomplete project of socialism which has made all social reforms fail to produce a change towards the control of a mode of production that can guarantee mutual prosperity. As a result, the social transformation to rid Venezuela from dependence on oil has not been successful. Meanwhile, the anti-Chavismo social forces, which had an economic base from the private sector, took advantage of this crisis to destroy the political project of Socialism.

It of course is due to communism, which is a nice idea in the theory, but the one of the worst economic systems when you put it into practice.

It is as simple as this. Do you know why the Berlin Wall was built? Because people were escaping en masse from a regime of political and economic repression to a free country. So, the Eastern Bloc politicians decided to build the wall.

How many people tried to escape from West Germany to East Germany by jumping over the wall? 0

How many people tried to escape from East Germany to West Germany by jumping over the wall? Tens of thousands, putting their lives on the line.

How many people try to escape from South Korea and go to North Korea? 0
And the other way around?

How many people escape from the United States to Cuba on a raft?
And the other way around?

How many people have escaped from Venezuela?

Venezuela exodus set to top 5 million as long-term needs grow, officials say.

And so on.

[coolcoinz]

Most countries did the same before the collapse of their currencies but what can they do? They want people to be able to pay without having to carry a bag full of money every time.
Unfortunately this is only postponing the inevitable because at some point the process of printing a bill will be worth more than the bill itself.

[NotATether]

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

These autocrats are so dseparate for more cash that they end up evading sanctions to open dubious bank accounts off shore, like the people in the Panama papers, and they also illegally hoard foreign cash in their houses.

This results in the national currency becoming worthless, and they have no intention of floating bonds to save it, because they are living comfortably with only a small amount of the (laundered) foreign cash they stashed for themselves.

Today, the economies who still cling to communist ideology as an economic system, and refuse to embrace capitalist thinking, such as Venezuela and North Korea, are in one of the worst shapes.

Venezuela has so many natural resources that the country should be flourishing with the right government. They need to eliminate corruption and make new economic reforms to get back on track.

Most developing countries with natural reserves are in a gridlock, because they can't process any of them locally. They have large foreign debt they owe developed countries they got in other ways. If you have debt but no capital assets, you can't spend anything on upgrading local infrastructure, paid to and developed by foreign countries, so this leads to a situation where they have to surrender their unusable natural reserves to creditor countries to waive their debts.

Like that the developing countries lose their ability to become bargaining developed powers, who demonstrate their political strength with their vast natural resource exports.

It all boils down to this: If you can export your natural resources en masse, you are taken seriously by bigger world powers. Political strength is fueled (pun not intended) by oil and gas exports.

[ChrisPop]

Inflation at its best.. People know this currency is shit, so they sell it as soon as they get. The important thing is if they are able to exchange it and with what asset. Ask yourself this: who is going to buy bolivars when the rate is so high?

Btw I have just checked on the internet and the inflation rate in Venezuela is like 15000%. That translates to 1 bolivar = 150 bolivar in one year. Crazy isn't it?

[sheenshane]

Buying a secure paper that will be used as a banknote is necessary for every country though the question is what is the purpose of this banknote is it really necessary at this time. We may immediately perceive that it can be used for corruption but if we will take a closer look at the purpose of creating a fiat we could consider that there is a possibility that it serves as a replacement of the old ragged fiat.

Another reason is for creating a higher denomination is that it could be handier and can be easily kept by an individual including using higher denomination in making transactions using cash it can be easier instead of paying with multiple paper bills. Though isn't the best resolution for hyperinflation for there are still online transactions that don't require paper bills like credit card or debit card but despite this modernization, if cryptocurrency will be adopted globally then there will be no issues on creating banknotes for it doesn't require affiliation on any bank system nor government.

Anyway, this How the political situation escalated in the Venezuela crisis. See how their politician leaders managed their country.

[pixie85]

Buying a secure paper that will be used as a banknote is necessary for every country though the question is what is the purpose of this banknote is it really necessary at this time. We may immediately perceive that it can be used for corruption but if we will take a closer look at the purpose of creating a fiat we could consider that there is a possibility that it serves as a replacement of the old ragged fiat.

For corruption? How?
Also, how is that going to improve security? Nobody is going to make fake bills that aren't even worth a dollar when they can make foreign currencies and make 100x more money.

Another reason is for creating a higher denomination is that it could be handier and can be easily kept by an individual including using higher denomination in making transactions using cash it can be easier instead of paying with multiple paper bills. Though isn't the best resolution for hyperinflation for there are still online transactions that don't require paper bills like credit card or debit card but despite this modernization, if cryptocurrency will be adopted globally then there will be no issues on creating banknotes for it doesn't require affiliation on any bank system nor government.

Anyway, this How the political situation escalated in the Venezuela crisis. See how their politician leaders managed their country.

It's handier but what they're doing is not to make storage more convenient. Nobody is going to hold a hyperinflated currency and it doesn't matter if the bills are old or new.
Bolivars are going to be a dead currency soon.

[CarnagexD]

This is so sad and will probably not help at all. They should be trying to fix their economy instead of printing new money. Who is actually going to use such a bill? I saw in a documentary about Venezuela that most stores are not accepting bolivar anymore as a means of payment. Most restaurants and stores only accept USD these. Around 70% of the families have atleast one family member living abroad send money, usually USD to Venezuela.

Venezuela has so many natural resources that the country should be flourishing with the right government. They need to eliminate corruption and make new economic reforms to get back on track.

They would need to this first as carrying a sackload of bolivar would be too inconvenient for the people. At the very least, I can call this their first step towards reclaiming their country's monetary image. For so long they have become the laughingstock when it comes to uselessness of money. I can say this is their first step towards the many in the near future.

[verita1]

Thank you all for discussing with analysis of the problem what the Venezuelan is experiencing. We know the reason and the negative meaning of the new high-denomination banknote like the 100,000 Bolívares. A galloping hyper inflation. The hope of the Venezuelan is that the crisis is not eternal because it still has a country with great potential to be productive as it was before.

[The Sceptical Chymist]

So spending fiat to produce more fiat, how ironic it is.

Yeah well, that happens everywhere--it's just that this is a dramatic case of how much is being spent to print the Bolivar bank notes (or whatever you call them) compared to how much they're worth.  Frankly I think the Venezuelan government ought to have picked out the cheapest paper and included as few security designs built into the notes as practically possible.

It's just sad how this rich oil nation turn into another sad story because of the mismanagement from the sitting President.

Definitely sad, and I hadn't heard any news out of Venezuela since before COVID-19 hit.  I thought their situation might have been improving, but I guess not.  What a fucked up situation they're in--and hopefully Venezuelans have adopted a more stable currency (like the USD) for their day-to-day financial transactions. 

And yes, bitcoin was built for situations exactly like this.  Even if it's volatile, it's not in a hyperinflation situation and isn't controlled by banks or governments. 

[romero121]

The prevailing situation of Venezuela is due to mismanagement, corruption, money printing in large volume, deficit spending, and more other political game. The sufferers of the Venezuelan hyperinflation is the common people who doesn't have any other go than move the life with what is available. One of the oil rich country and the richest of South America into such a crisis. Even the countries that doesn't have any source are growing good out of their planning.

By the time of covid-19 the entire country could've suffered much, or else it might have not got attacked as there is no big news out from Venezuela. The worst part is the people suffering for food, as the production has been cut and they are unaffordable to import food and other necessary things.

[jaysabi]

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

Seems to me digital currency would be easier to manipulate. No need to print all that money when you can just expand the monetary base by typing extra zeros in the central bank's account and pushing that money into the economy. I think the reason Venezuela needs so much paper money is not because they're corrupt but because they're not technologically advanced to have a digital economy.

[Kemarit]

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

Seems to me digital currency would be easier to manipulate. No need to print all that money when you can just expand the monetary base by typing extra zeros in the central bank's account and pushing that money into the economy. I think the reason Venezuela needs so much paper money is not because they're corrupt but because they're not technologically advanced to have a digital economy.

Still though, the argument that they didn't make any technological advancement is because the government is really corrupt that maybe the funds allocated for it could have ended up in the pocket of those politicians.

So it's really a lot of contributory factors, mismanagement of politicians, and then their cronies, owning half of the private companies so in just like 10 years, the country made a U-turn for the worst. And now printing worthless mickey mouse money.

[DrG]

Venenzuela just went overboard with it's infrastructure spending - specifically its social programs. Those are a great way to boost a 3rd world country if there's a lot of positive cash flow but one big economic downturn and you've got a massive deficit. The country can't even rely on tourism like it used to - it's just all oil and that is not favorable in the NWO thinking (despite all those elites burning barrels a day).

This shows just how wonderful life is there: https://www.youtube.com/watch?v=2n7mK3dYOLw

[Vishnu.Reang]

Seems to me digital currency would be easier to manipulate. No need to print all that money when you can just expand the monetary base by typing extra zeros in the central bank's account and pushing that money into the economy. I think the reason Venezuela needs so much paper money is not because they're corrupt but because they're not technologically advanced to have a digital economy.

Centralized digital currencies are easier to manipulate. But there will be few takers for such currencies, since they are similar to the digital version of fiat cash. It is not possible to manipulate decentralized cryptocurrencies such as Bitcoin, and I don't think that the Venezuelan regime would be interested in such currencies. For now they are somewhat tolerating it, for well known reasons.

[South Park]

Venezuela Planning New 100,000-Bolivar Bills Worth Just $0.23

Venezuela has begun to import banknote paper and is mulling plans to print bills with larger denominations as hyperinflation causes shortages of cash, according to six people with knowledge of the matter.

The country has brought in about 71 tons of security paper this year from an Italian printer majority owned by the private equity firm Bain Capital, according to some of the people and data reviewed by Bloomberg from Import Genius, which compiles customs records it obtains through private sources. The central bank is considering new bills starting with 100,000 bolivars, the people said. It would be the highest denomination yet, but still worth only $0.23.

https://www.bloomberg.com/news/articles/2020-10-05/venezuela-planning-new-100-000-bolivar-bills-worth-just-0-23

So spending fiat to produce more fiat, how ironic it is. It's just sad how this rich oil nation turn into another sad story because of the mismanagement from the sitting President.

And what's next $1 million Bolivar Bills just worth a dollar?

And it makes sense the Venezuelan are into bitcoin, with record breaking transactions like everyday.

As you say this is such a shame, Venezuela before all of this was a beautiful country full of hard working people and beautiful destinations ready to receive tourists all over the world, and now after all of this it has turned in such a difficult to place to just keep on living that many people have either left the country or are thinking of doing it as we speak, and the worst part is that when all of this is over and finally those people are left without power it is going to take at least a generation to fix this mess and that is if the people of Venezuela elect people that are willing to solve this which is doubtful.

[bryant.coleman]

As you say this is such a shame, Venezuela before all of this was a beautiful country full of hard working people and beautiful destinations ready to receive tourists all over the world, and now after all of this it has turned in such a difficult to place to just keep on living that many people have either left the country or are thinking of doing it as we speak, and the worst part is that when all of this is over and finally those people are left without power it is going to take at least a generation to fix this mess and that is if the people of Venezuela elect people that are willing to solve this which is doubtful.

If Venezuela was full of hard working people, this could have never happened. This issue is not just limited to Venezuela. It is common to almost all the Latin American nations. There is a large section of the public in these countries, that prefer socialist policies. These countries are rich in natural resources, and it allows the government to indulge in populist policies. But when the spending goes above the tolerance threshold, the economic meltdown occurs (similar to what happened in Venezuela).

[hulla]

As you say this is such a shame, Venezuela before all of this was a beautiful country full of hard working people and beautiful destinations ready to receive tourists all over the world, and now after all of this it has turned in such a difficult to place to just keep on living that many people have either left the country or are thinking of doing it as we speak, and the worst part is that when all of this is over and finally those people are left without power it is going to take at least a generation to fix this mess and that is if the people of Venezuela elect people that are willing to solve this which is doubtful.

If Venezuela was full of hard working people, this could have never happened. This issue is not just limited to Venezuela. It is common to almost all the Latin American nations. There is a large section of the public in these countries, that prefer socialist policies. These countries are rich in natural resources, and it allows the government to indulge in populist policies. But when the spending goes above the tolerance threshold, the economic meltdown occurs (similar to what happened in Venezuela).

Economic problem is common almost among all latin American nations but Venezuela situation is worse and hyperinflation doesn't mean the Venezuelan people are not hard working as explained by South Park. However, what led to Venezuela todays problem is political turmoil, embezzlement of public funds and autocracy which started since 19th century.

The Venezuelan need people that will solve this issue so they can totally profit and put fund generated through the country mineral resources not the printing of new note which the government will still use to scam the country economy.

[DrG]

The problem is the Venezuela government has really brought any idea of self sufficiency to a halt. Look at that youtube video link i posted above. Farmers have stopped farming because they lose money trying to farm. The government spent so much money distributing "care packages" to the public that the public lost the ability to care for themselves. Their economy is dead just like a dried up water pump -it needs to be primed. They can restart that with their tourism since they still have some infrastructure from before (737s can still land at the main airport). If they continue to rely on their internal government to fix the problem they will never get their economic engine rolling. UAE was able to transition off oil reliance, Venezuela should be able to as well - they just need to be willing to interact with other countries.

[shoreno]

If Venezuela was full of hard working people, this could have never happened.

thats impossible . no country has ever stated to have a full of hardworking people because theres that percent of people that are lazy or simply dont work hard but this dont mean that all of those people are poor but some are already blessed with a good economy or a good life . on most asian countries its said that most people living on this country are hard working but thier economy is still poor ,

its not thier fault but sometimes its the fault of their government  .

[Del137]

At least Venezuela is trying to do something with their economy. Their crypto ideas looks interesting

[slapper]

Printing 100,000 Bolivar for what purpose ? It does not worth anymore. What are the government thinking right now? What a dump ass person! Instead of saving the economy by realistic action, he try to print more money for an even worse inflation. This situation is hopeless. I cant believe that there are still many countries out there which are under a more terrible condition than mine

The mediocre President needs to accept international aids so that they can meliorate their economy. I wonder how people are struggling there right now. It must be a nightmare trying to find food and supply daily. The government must have been trying to stop reporters from recording and uploading the tragic footage of Venezuelans

[fiulpro]

See when it comes to cryptocurrencies venezuela is one of those few nations who are actually trying to integrate their economy with the cryptocurrencies. Unfortunately the government is totally incapable of handling any situation there. Government is uneducated, corrupt , fragile, the mismanagement not only killed their own resources which would have made the country very stable and well endowed, they at the same time decreased the overall production rates.
The country doesn't have resources now, there is no import of the needed things , prices are rising ridiculously. It's in a really bad condition right now.
But I believe they should carefully see what steps their are taking this is not only ridiculous, but even worse for the people who would try and get jobs...

[Vishnu.Reang]

If Venezuela was full of hard working people, this could have never happened.

thats impossible . no country has ever stated to have a full of hardworking people because theres that percent of people that are lazy or simply dont work hard but this dont mean that all of those people are poor but some are already blessed with a good economy or a good life . on most asian countries its said that most people living on this country are hard working but thier economy is still poor ,

its not thier fault but sometimes its the fault of their government  .

The government was elected by the people themselves. So it is their fault. Here in India, we had a similar scenario. Last year, when the general elections were near, the leader of the opposition party promised ₹5,000 per month in handouts to poor households. But voters rejected his proposal and his party just received 52 out of a total of 542 seats. If someone elects a Socialist regime to power, then it is their problem and I don't have any sympathy with such people.

[RealMalatesta]

See when it comes to cryptocurrencies venezuela is one of those few nations who are actually trying to integrate their economy with the cryptocurrencies. Unfortunately the government is totally incapable of handling any situation there. Government is uneducated, corrupt , fragile, the mismanagement not only killed their own resources which would have made the country very stable and well endowed, they at the same time decreased the overall production rates.
The country doesn't have resources now, there is no import of the needed things , prices are rising ridiculously. It's in a really bad condition right now.
But I believe they should carefully see what steps their are taking this is not only ridiculous, but even worse for the people who would try and get jobs...

We have to also consider the fact that other nations decided to put some laws against trading with Venezuela because they didn't want to deal with the dictator.

Now, I understand that Venezuela political situation is bad and the ruler is a bad person who didn't get elected and rules over by force, so it makes sense that you do not like him, I do not like him neither, I hope he gets couped and finally gone and people could have a free election.

However when another nation stops dealing with you over political reasons, they are not punishing the politicians, they are punishing the public. Look at the dictator, he has his food and his castle, he is not bothered, and he is still the most powerful person there with all that big army. But the public is starving and dying, why? Because big nations wanted to give a lesson to the dictator... which obviously failed.

[stompix]

One bill is usually 1 gram, let's assume there are absolutely no losses that makes 71 000 000 bills, but with them being worth just 0.23$ , it's just $16,3 million and something, or 1430BTC.
But the funny part is in the middle of the article:

Earlier this year, Venezuela turned to a state-owned money printer in Russia to purchase 300 million of new bills after racking up debts with De La Rue, one of the world’s largest makers of bank notes.

Pinnacle of socialism, you're getting in debt when you're printing money, if this keeps up their only option is to start using monopoly money, and of course, not printing them but asking for donations.

Of course this is also largely mismanagement as well as their dirty politics, but this oil-rich country is also suffering from the severe decrease in oil's price. And who would discount the economic sanctions harshly imposed on them by the powerful western countries led by the USA?

So, the situation is because of imbeciles getting elected and ruling and ruining the country and free money not flowing from the ground at the same pace, the real sanctions on the economy came well too late, the country was doomed from 6 years ago.  Also, I find it funny how people are angry and the US for sanctioning Venezuela but haven't said a word previously when Venezuela was milking the capitalists with 100$ a barrel. What have the western world countries done? They stopped dealing with them, simple, isn't that the scenario that would have anyhow happened when all the dirty capitalist world would have collapsed?

[Harlot]

I really don't know what it is but I think the Venezuelan government at this point is doing all they can for their people to survive but the thing is what they are doing is dragging the country down. Right now this move is something that I don't think they will benefit really even in the short term as they are further devaluing their own currency. If they really want to have a plan that will work they should focus on the economy rather than focus on their money.

[DrG]

One bill is usually 1 gram, let's assume there are absolutely no losses that makes 71 000 000 bills, but with them being worth just 0.23$ , it's just $16,3 million and something, or 1430BTC.
But the funny part is in the middle of the article:

Earlier this year, Venezuela turned to a state-owned money printer in Russia to purchase 300 million of new bills after racking up debts with De La Rue, one of the world’s largest makers of bank notes.

Pinnacle of socialism, you're getting in debt when you're printing money, if this keeps up their only option is to start using monopoly money, and of course, not printing them but asking for donations.

Of course this is also largely mismanagement as well as their dirty politics, but this oil-rich country is also suffering from the severe decrease in oil's price. And who would discount the economic sanctions harshly imposed on them by the powerful western countries led by the USA?

So, the situation is because of imbeciles getting elected and ruling and ruining the country and free money not flowing from the ground at the same pace, the real sanctions on the economy came well too late, the country was doomed from 6 years ago.  Also, I find it funny how people are angry and the US for sanctioning Venezuela but haven't said a word previously when Venezuela was milking the capitalists with 100$ a barrel. What have the western world countries done? They stopped dealing with them, simple, isn't that the scenario that would have anyhow happened when all the dirty capitalist world would have collapsed?

Yeah bad capitalist buying oil over $100 a barrel and exploiting poor Venezuela. They should be buying it now at $40 when nobody wants it

Venezuela needs to play kiss ass again and entice the wealthy from Dubai, US, and affluent Europeans and Asians. The rich are often bored and want to see new stuff. Many of this current generation have not been to Venezuela. The country would have been better off spending the $300million on a tourism campaign. It worked for Turkey.

[bryant.coleman]

Yeah bad capitalist buying oil over $100 a barrel and exploiting poor Venezuela. They should be buying it now at $40 when nobody wants it

The OPEC made the mistake during 2009-2013, when they tried to push crude oil prices too high. There were statements from the OPEC such as "consumers should be ready for $200 per barrel oil" and "the era of cheap oil is over". As a response, the US shale oil producers moved in and ramped up their production. The greed of OPEC members such as Saudi Arabia and Venezuela resulted in their own downfall.

[Wind_FURY]

Hahaha. Monopoly play money, as a collectible, is a better Store of Value than the Bolivar. A the vintage set sells for $30.00 or more in eBay.

[LogitechMouse]

The damage has been done. They are just creating shit fiat money just like people creating shitcoins in crypto.
Hyperinflation has been there for a long time. Probably this is the start of the recovery of their economy?? Lets see how their plan goes.
If somebody from Venezuela has their Bolivar Bills, just sell it in an online store and probably somebody will keep it as a remembrance or a collectible .

[posi]

I really don't know what it is but I think the Venezuelan government at this point is doing all they can for their people to survive but the thing is what they are doing is dragging the country down.

In my opinion, if they are indeed doing what they can do in other for their people to survive, they won't have think of the option that will drag their economic to the mud cause the news says there was shortages of cash and what they need is to encourage their citizen to use electronic transaction instead of spending more money which ought to be use to help the country economy to print more cash.

[South Park]

As you say this is such a shame, Venezuela before all of this was a beautiful country full of hard working people and beautiful destinations ready to receive tourists all over the world, and now after all of this it has turned in such a difficult to place to just keep on living that many people have either left the country or are thinking of doing it as we speak, and the worst part is that when all of this is over and finally those people are left without power it is going to take at least a generation to fix this mess and that is if the people of Venezuela elect people that are willing to solve this which is doubtful.

If Venezuela was full of hard working people, this could have never happened. This issue is not just limited to Venezuela. It is common to almost all the Latin American nations. There is a large section of the public in these countries, that prefer socialist policies. These countries are rich in natural resources, and it allows the government to indulge in populist policies. But when the spending goes above the tolerance threshold, the economic meltdown occurs (similar to what happened in Venezuela).

What happens is a classic case of overcompensation, a good deal of governments on Latin America are corrupt and enrich those that are in power and their friends, obviously this is unfair and people eventually elect a populist president that says he will give them everything they want, unfortunately this goes against basic economic principles and instead of stopping a series of expropriations, money printing and debt follows destroying the economy on the process.

[ecnalubma]

They could have been one of the most rich country in the world but what happened is the opposite. That’s what will happen if we let incompetent people run our country, people will continue to suffer if their system will not change. Cryptocurrency is already playing a big role in their current financial system they should stop exporting those useless security papers.

[stompix]

I really don't know what it is but I think the Venezuelan government at this point is doing all they can for their people to survive but the thing is what they are doing is dragging the country down.

And what makes you think this?
Can you tell me one thing they have done to help their people survive?
The rabbit plan?  Fingerpriting shoppers? Deploying 17 000 troops to combat food smuggling? When there is no food? Or creating a useless cryptocurrency that nobody uses?

Name one thing that they have done entirely for the people and not to keep themselves in power longer!
They aren't doing a thing, they just watch how everything is worsening day by day because they know that they will lose their place and influence if real reforms happen.

Lets see how their plan goes.

What plan? There is none!

[jaysabi]

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

Seems to me digital currency would be easier to manipulate. No need to print all that money when you can just expand the monetary base by typing extra zeros in the central bank's account and pushing that money into the economy. I think the reason Venezuela needs so much paper money is not because they're corrupt but because they're not technologically advanced to have a digital economy.

Still though, the argument that they didn't make any technological advancement is because the government is really corrupt that maybe the funds allocated for it could have ended up in the pocket of those politicians.

So it's really a lot of contributory factors, mismanagement of politicians, and then their cronies, owning half of the private companies so in just like 10 years, the country made a U-turn for the worst. And now printing worthless mickey mouse money.

Yeah, I'm not taking issue with the level of corruption in the country. Just the notion that the reason they didn't go with digital currency and stuck with physical currency was because it made the corruption easier. The far more likely reason they don't have a digital currency is because they lack the technology to do so, not out of intention.

[Vishnu.Reang]

What happens is a classic case of overcompensation, a good deal of governments on Latin America are corrupt and enrich those that are in power and their friends, obviously this is unfair and people eventually elect a populist president that says he will give them everything they want, unfortunately this goes against basic economic principles and instead of stopping a series of expropriations, money printing and debt follows destroying the economy on the process.

Giving unlimited handouts is a bad idea. Even oil rich nations such as Saudi Arabia and Qatar have realized this, and now they are slowly moving away from those policies. In case of Venezuela, when the oil prices were high the Hugo Chavez regime distributed all the budget surplus as handouts. The government never cared to setup a rainy day fund, so that they could use it in case the oil prices go down. In the end, the oil prices went down, and the government treasury was bone dry by then.

[South Park]

What happens is a classic case of overcompensation, a good deal of governments on Latin America are corrupt and enrich those that are in power and their friends, obviously this is unfair and people eventually elect a populist president that says he will give them everything they want, unfortunately this goes against basic economic principles and instead of stopping a series of expropriations, money printing and debt follows destroying the economy on the process.

Giving unlimited handouts is a bad idea. Even oil rich nations such as Saudi Arabia and Qatar have realized this, and now they are slowly moving away from those policies. In case of Venezuela, when the oil prices were high the Hugo Chavez regime distributed all the budget surplus as handouts. The government never cared to setup a rainy day fund, so that they could use it in case the oil prices go down. In the end, the oil prices went down, and the government treasury was bone dry by then.

Without a doubt it is a bad idea but this is just more evidence the average person does not understand basic economic principles, it seems they think that just because governments are bigger than they are they can spend all the money they want and this is not true, governments still need to follow the same principles that any normal family would, they need to spend less than what they get on taxes and keep something for a rainy day as you say, but politicians are nothing more but a reflection of the society that elects them, so if the population does not understand this the politician most likely does not as well or at least does not care and that is how it begins the economic debacle of most countries.

[BuNga_cute]

As long as the government in Venezuela is still high in corruption, and politics in Venezuela is still dirty,
then the country will continue to repeat the same mistakes. Because corruptors do need a lot of paper money,
so for me it is not surprising that the Venezuelan government must continue to print money. It is a pity even
though Venezuela has good natural wealth, if its government is clean, hyperinflation will certainly not occur.

[AmoreJaz]

As long as the government in Venezuela is still high in corruption, and politics in Venezuela is still dirty,
then the country will continue to repeat the same mistakes. Because corruptors do need a lot of paper money,
so for me it is not surprising that the Venezuelan government must continue to print money. It is a pity even
though Venezuela has good natural wealth, if its government is clean, hyperinflation will certainly not occur.

corruption is hard to eradicate as it is like already innate in their system. sadly.
 based on last year's corruption index of Venezuela, it only scored 16 points out of 100

https://tradingeconomics.com/venezuela/corruption-index


based from the graph, they are not improving, instead they are going more corrupt!  




so what can we expect from this govt even if they print tons of paper money. hard to move forward if their govt officials are still deep in the old corrupt system

[Salauddin1994]

Venezuela's system of government is very dirty politics and the government does not take any firm action against corruption so the political situation in venezuela is getting worse day by day despite being the best in terms of natural resources many believe that the mining sector in venezuela has been destroyed by nationalization. There is no state policy for this sector  accidents often happen in these mines  robberies and murders continue to cause inflation some new notes were released to control uncontrolled inflation. The venezuelan currency the bolivar has now become virtually worthless paper there has been a severe economic downturn in that country.

[bryant.coleman]

Venezuela's system of government is very dirty politics and the government does not take any firm action against corruption so the political situation in venezuela is getting worse day by day despite being the best in terms of natural resources many believe that the mining sector in venezuela has been destroyed by nationalization. There is no state policy for this sector  accidents often happen in these mines  robberies and murders continue to cause inflation some new notes were released to control uncontrolled inflation. The venezuelan currency the bolivar has now become virtually worthless paper there has been a severe economic downturn in that country.

Having natural resources doesn't mean that a country will be rich. If that was the case, then DRC (Democratic Republic of the Congo) could have been the richest country on earth. If the people don't have enough educational skills and work ethics, having natural resources will be of very little use. This is applicable everywhere, from Venezuela to the African nations, and from the oil-rich Arab states to the mineral rich Russia.

[redsun114]

I’m just not really getting this. If Bitcoin is what works for them, then it’s best that the people continues to be using Bitcoin so that they are not going to suffer due to the corruption of their leaders. This plague of having corrupt leaders (yep plague lol) is something that my country is also facing, they see lots of things going wrong, lots of bad situation, and people will call, shout, even protest and it will fall on f**cking deaf ears.

Only God can save us from these problems. It’s high time that people rise up against these evil souls so called leaders who are not even leaders but just rulers that are there to destroy countries. Their main focus when they are elected is sending their kids to best schools, and filling their bags. Worst part is that the system is so damn corrupt that these people will do things and still go free without facing judgement for the crimes they commit. God help us.

[TravelMug]

Interesting to note as well that Venezuelans’ average income was just .72 U.S. cents per day.

So it doesn't really make sense for them to print this new bills when people are not earner enough to survived for even a day. Yes, they are on the top 3 as far as bitcoin usage in LocalBitcoins and this is good news. And not just in Venezuela, but in Latin America as a whole and it just make sense as people are trying take back their "economic sovereignty".

[DrG]

Yeah bad capitalist buying oil over $100 a barrel and exploiting poor Venezuela. They should be buying it now at $40 when nobody wants it

The OPEC made the mistake during 2009-2013, when they tried to push crude oil prices too high. There were statements from the OPEC such as "consumers should be ready for $200 per barrel oil" and "the era of cheap oil is over". As a response, the US shale oil producers moved in and ramped up their production. The greed of OPEC members such as Saudi Arabia and Venezuela resulted in their own downfall.

Exactly. You push a system too far out of bounds and reasonable forces will exert themselves to correct the imbalance. If oil prices shot up to $1000/barrel all of a sudden nuclear reactors and solar would be popping up all over the place. Quasi environmentalist complaining about birds getting killed by windmills would allow windmills in their own backyard so they could keep watching Netflix.

Oil because expensive enough to warrant US exploration in a previously "difficult" location.

I can only hope the Venezuela people become fed up with too much government control to actually start fixing their own issues without relying on government's helping hand (a hand which may never show up).

[Sithara007]

Interesting to note as well that Venezuelans’ average income was just .72 U.S. cents per day.

So it doesn't really make sense for them to print this new bills when people are not earner enough to survived for even a day. Yes, they are on the top 3 as far as bitcoin usage in LocalBitcoins and this is good news. And not just in Venezuela, but in Latin America as a whole and it just make sense as people are trying take back their "economic sovereignty".

That is less than $0.01 per day? I guess the socialist government provides for most of the food, education and medical requirement. But still it will be difficult to survive on such low income. It amazes me how such a resource rich country can become so bankrupt, that the people can't afford to have food three times a day. Another failed socialist nation...

[Wind_FURY]

Citizens of Venezuela, your 100,000,000 Bolivars can buy you BTC0.019008. Buy now before your 100,000,000 Bolivars can only buy you BTC0.0019008.

Your government has lost control over the monetary system.

[Vishnu.Reang]

Citizens of Venezuela, your 100,000,000 Bolivars can buy you BTC0.019008. Buy now before your 100,000,000 Bolivars can only buy you BTC0.0019008.
Your government has lost control over the monetary system.

Yeah.... this is what hyperinflation can do to fiat currency. Central banks sometimes print banknotes without any control and this in turn destroys the value of the currency and makes it less valuable than toilet paper. Also, this is one of the reasons why Satoshi Nakamoto came up with Bitcoin in 2008. Hyperinflation is not unique to Venezuela. Previously many of the countries, such as Argentina, Russia and Zimbabwe used to suffer from it. Socialist countries, especially those in the Latin American region are more susceptible to hyperinflation, from what we have seen previously.

[TravelMug]

Citizens of Venezuela, your 100,000,000 Bolivars can buy you BTC0.019008. Buy now before your 100,000,000 Bolivars can only buy you BTC0.0019008.

Your government has lost control over the monetary system.

And they've really lost control of:



@Sithara007 - maybe the government provided some of the basic needs, like North Korea, but people need more, they have the rights to survived and make a living for themselves. It will be good if the government will provide the basics and keep the country from this hyperinflation, but they didn't and yet keeps printing money that's why the country is on a cluster fuck and continue to nose dive.

[sana54210]

Normally when it is not like Venezuelan economy I would say its not really that important to have bills that worth tiny amount of money. Look at Japan for example they spend tens of thousands of yen every single day for regular stuff but also earn hundreds of thousands of yen which means their money looks like it is worthless when you compare to dollars but in reality the life is a lot of yen there as well so it makes sense.

For example if 100k bolivar bills is 0.23 than rent should be 100 million, if it is not, that is the real problem not the bills. That is of course very hard to deal with and manage when you have such a hard difficulty with your economy its understandable to have these type of troubles.

[cabron]

The country is full of corrupt officials though so it's not very surprising that what happens in Zimbabwe can also happen to Venezuela. 

If the country is going to be using BTC after this inflation that they will be doing, I think they will one day be using digital Bolivar too. A digital currency that can be traced that will stop corrupt officials from being corrupt, I think the future will still be good for the country as long as they have oil.

[cryptomaniac_xxx]

The country is full of corrupt officials though so it's not very surprising that what happens in Zimbabwe can also happen to Venezuela. 

If the country is going to be using BTC after this inflation that they will be doing, I think they will one day be using digital Bolivar too. A digital currency that can be traced that will stop corrupt officials from being corrupt, I think the future will still be good for the country as long as they have oil.

I'm not really sure if you have heard about digital Bolivar or Petro, supposedly back up by oil and other others like Russia, and it turns out that this is not true. Maduro though try very hard to keep Petro, even pushing it for Venezuelans to used it, but it was really a failure and they used BTC instead, and that help them somewhat to survived in the worst situation.

[South Park]

Citizens of Venezuela, your 100,000,000 Bolivars can buy you BTC0.019008. Buy now before your 100,000,000 Bolivars can only buy you BTC0.0019008.

Your government has lost control over the monetary system.

Eventually they all do and at least during the last one hundred years this has been because governments think they can get away with anything since they are the ones that have the ability to print as much money as they want and as soon as they run into a problem instead of cutting expenses the first thing they is to print more money and think they are going to resolve everything that way, but what happens when the problem itself is that they have printed too much money? They print even more, as illogical as it sounds they think that is going to resolve the problem and they only make it worse.

[TravelMug]

And probably not just Venezuela:



https://twitter.com/alistairmilne/status/1319170878765211648

More countries are going to rely on BTC, and if those countries continue to print worthless bills sooner or later bitcoin might take over on those stricken nations, so don't be surprised in the near future of we heard that one in those list will go down hard.

[jaysabi]

What happens is a classic case of overcompensation, a good deal of governments on Latin America are corrupt and enrich those that are in power and their friends, obviously this is unfair and people eventually elect a populist president that says he will give them everything they want, unfortunately this goes against basic economic principles and instead of stopping a series of expropriations, money printing and debt follows destroying the economy on the process.

Giving unlimited handouts is a bad idea. Even oil rich nations such as Saudi Arabia and Qatar have realized this, and now they are slowly moving away from those policies. In case of Venezuela, when the oil prices were high the Hugo Chavez regime distributed all the budget surplus as handouts. The government never cared to setup a rainy day fund, so that they could use it in case the oil prices go down. In the end, the oil prices went down, and the government treasury was bone dry by then.

Without a doubt it is a bad idea but this is just more evidence the average person does not understand basic economic principles, it seems they think that just because governments are bigger than they are they can spend all the money they want and this is not true, governments still need to follow the same principles that any normal family would, they need to spend less than what they get on taxes and keep something for a rainy day as you say, but politicians are nothing more but a reflection of the society that elects them, so if the population does not understand this the politician most likely does not as well or at least does not care and that is how it begins the economic debacle of most countries.

Politicians constantly fail to lead. It's far easier to continue deficit spending than to balance the budget and make the hard decisions that need to be made in order to do so, especially since the only way to do this is to cut spending or raise taxes.  In the US, the budget is so unbalanced that it would take drastic spending cuts and drastic tax increases to balance the budget. The average person is generally too stupid to realize that failure to act now makes the situation worse in the future, and something will eventually give, and politicians are only interested in getting elected, so nobody is going to run on a platform of doing what needs to be done to get our finances in order.

[Sithara007]

I'm not really sure if you have heard about digital Bolivar or Petro, supposedly back up by oil and other others like Russia, and it turns out that this is not true. Maduro though try very hard to keep Petro, even pushing it for Venezuelans to used it, but it was really a failure and they used BTC instead, and that help them somewhat to survived in the worst situation.

Bitcoin is one of the better options, at least compared to the Petro shitcoin. But the big question is whether the regime can afford to purchase BTC? They have sold almost all of their gold reserves, and I don't think that they have anything valuable left in the state treasury. Petro is very similar to their worthless banknotes. They can mine as much as they want. But that is not the case with Bitcoin.

[milesfull]

Its better for tham to just develop their crypto and forget about cash

[Nellayar]

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

I agree to you! Only banks and corrupted officials are happy in printing fiat more. If there is a continuously printing of money, inflation will occur. The prices will goes up because the value of a product becomes more higher. It tends to create an economic recession when the country has high rate in inflation. This is not new already because we all know that even before, Venezuela is a country that has a lot of corrupt officials and printing of money is not new to them. In fact, if I remembered they already suffered from hyper inflation.

[btc_angela]

Its better for tham to just develop their crypto and forget about cash

Who are you referring to? The government or the people themselves? They have their own crypto already and it is called bitcoin (BTC), which in turn is the saviour in the worsening situation in their country. And it's obvious that there are people inside the country that don't like the current government of Maduro and even thinking of overthrowing him. Unfortunately, he is still clinging into the power despite seeing the obvious that the country is turning into one of the worst financial and economic disasters we've witnessed post world war. But bitcoin is here to stay with them through thick and thin.

[yhiaali3]

Indeed, it is very sad that things turn out so badly in Venezuela, the oil-rich country, the reason for sure is mismanagement. This idiot who issues orders to print more paper currency will lead to further economic decline in the country. Printing more papers that have no value is not the answer.

[Vishnu.Reang]

Indeed, it is very sad that things turn out so badly in Venezuela, the oil-rich country, the reason for sure is mismanagement. This idiot who issues orders to print more paper currency will lead to further economic decline in the country. Printing more papers that have no value is not the answer.

I am not sure whether the "idiot" had any other option available with him. Government servants and the armed forces needs to be paid and the only thing they can do is to print more banknotes (even if they are completely worthless). Anyway, this is a lesson to all the governments out there, especially in the Latin American region. When you have surplus money, you need to save at least a part of it.

[matchi2011]

Its better for tham to just develop their crypto and forget about cash

Who are you referring to? The government or the people themselves? They have their own crypto already and it is called bitcoin (BTC), which in turn is the saviour in the worsening situation in their country. And it's obvious that there are people inside the country that don't like the current government of Maduro and even thinking of overthrowing him. Unfortunately, he is still clinging into the power despite seeing the obvious that the country is turning into one of the worst financial and economic disasters we've witnessed post world war. But bitcoin is here to stay with them through thick and thin.

Yeah right, bitcoin is helping this country more on the people side, having a non value paper print fiat really hurt the entire country, but it's good thing that they acquired bitcoin and allow it being used around.

Without any changes from this current government, the country will continue to suffer from this problem, they don't have any options as the government still solid in ruling them, not unless people power will take place and restart this country.

[samcrypto]

Indeed, it is very sad that things turn out so badly in Venezuela, the oil-rich country, the reason for sure is mismanagement. This idiot who issues orders to print more paper currency will lead to further economic decline in the country. Printing more papers that have no value is not the answer.

Economist must step up so they can help the country survive considering the Oil-Rich country, they still have the chance to survive but printing more money is indeed not a solution. I'm just thinking, they ended up like this so badly and I think some country are also behind on this one maybe putting too much sanctions and pressure to the current administration is too much, a lot of people are suffering because of this and instead of helping them some country still don't want to. I know their government is corrupt of course, People in Venezuela just need some help from a real people so they can finally win against their corrupt government.

[bryant.coleman]

Economist must step up so they can help the country survive considering the Oil-Rich country, they still have the chance to survive but printing more money is indeed not a solution. I'm just thinking, they ended up like this so badly and I think some country are also behind on this one maybe putting too much sanctions and pressure to the current administration is too much, a lot of people are suffering because of this and instead of helping them some country still don't want to. I know their government is corrupt of course, People in Venezuela just need some help from a real people so they can finally win against their corrupt government.

You can't blame the sanctions for their current state. Venezuela was in a shitty state even before the sanctions were imposed. The currency was worth less than the paper on which it was printed and even essential items were going out of stock in the supermarkets. The sanctions were triggered due to irregularities and vote rigging during the 2018 Venezuelan presidential election, which Nicolás Maduro claims to have won.

[iv4n]

Indeed, it is very sad that things turn out so badly in Venezuela, the oil-rich country, the reason for sure is mismanagement. This idiot who issues orders to print more paper currency will lead to further economic decline in the country. Printing more papers that have no value is not the answer.

I am not sure whether the "idiot" had any other option available with him. Government servants and the armed forces needs to be paid and the only thing they can do is to print more banknotes (even if they are completely worthless). Anyway, this is a lesson to all the governments out there, especially in the Latin American region. When you have surplus money, you need to save at least a part of it.

When you have a surplus money you need to invest it, in that money will work for you, not against you (inflation). Buying gold, investing in development of some products, in the last 10 years investing in crypto... there're many options what country can do with extra money! Here we need to take a look on the bigger picture, sometimes you can't breathe from bullies around, and Venezuela have some problems with their gold in the UK (they are saying billions in gold is locked), they say it's because Maduro, but who knows what's really happening on the global stage! As I always say, I am aware that innocents are being hurt, and innocent suffer mostly, which is terrible thing, while warlords and their families, close people, enjoy in life full of everything! It's not the first time we see this, and for sure it's not the last time!

[Vishnu.Reang]

When you have a surplus money you need to invest it, in that money will work for you, not against you (inflation). Buying gold, investing in development of some products, in the last 10 years investing in crypto... there're many options what country can do with extra money! Here we need to take a look on the bigger picture, sometimes you can't breathe from bullies around, and Venezuela have some problems with their gold in the UK (they are saying billions in gold is locked), they say it's because Maduro, but who knows what's really happening on the global stage! As I always say, I am aware that innocents are being hurt, and innocent suffer mostly, which is terrible thing, while warlords and their families, close people, enjoy in life full of everything! It's not the first time we see this, and for sure it's not the last time!

The regime sold all the gold bars they could find in the treasury. When that was finished, they realized that the majority of the Venezuelan gold reserves are stored in some vault in London (because the previous government thought that storing that in Venezuela is very risky). Now Maduro wants to return this gold to Venezuela. British government rejected the request, saying that they don't consider Maduro as the rightful president of Venezuela.

[STT]

23 cents for a 1 cent or less cost is an attractive prospect is the simplest take.

The parliamentary elected top government official has the control of the countries gold, its being decided via the courts is last I heard.    I can only hope the gold price continues to rise and it becomes increasingly attractive to return the power to the people so that the nation can regain control of its capital and trade to the peoples benefit.     At present the country is weak and proxy for illegal activity in a path well trodden over the years.

The country is full of corrupt officials

The military is running drugs for the colombian cartels apparently, they are quite happy in their positions though the soldiers may not be those in control for now are.    Restoring proper power to the country would lose this valuable revenue source for some so theres an active interest in maintaining weakness and disarray across the country.

[Fortify]

It's like watching the hyper inflation of Zimbabwe happening again and would be comical if it wasn't causing such a tough situation for all the local people. Ironically the trillion dollar notes that you now find on ebay are worth vastly more as a novelty collectible item than they ever were worth as a tradeable unit of currency when in circulation. Hopefully the people of Venezuela are able to free themselves from the dictatorship as soon as possible and start to reset the economy.

[Abiky]

I'm not really sure if you have heard about digital Bolivar or Petro, supposedly back up by oil and other others like Russia, and it turns out that this is not true. Maduro though try very hard to keep Petro, even pushing it for Venezuelans to used it, but it was really a failure and they used BTC instead, and that help them somewhat to survived in the worst situation.

Venezuela can't seem to revive its economy, no matter what its efforts may be. Its latest attempt of creating a digital currency backed by oil reserves turned out to be a huge failure. They're better off using Bitcoin as a reserve currency to protect the economy. The Venezuelan Bolivar can be backed by Bitcoin directly, instead of printing new bills that would cause hyperinflation. 100k Bolivar bills worth just $0.23 USD shows us how low the Venezuelan economy has declined. If the government doesn't do anything to restore the economy, then I'm afraid chaos will persist in the nation. People will have less spending power over time, leading them to extreme poverty. It's unfortunate how Venezuela's economy turned out to be, after being a rich country some time ago. With US sanctions, it becomes quite challenging for Venezuela to get on its feet back again. Some say that President Maduro's regime has made matters worse. I believe that things were better when President Hugo Chavez was in power.

All in all, Venezuela's situation of hyperinflation might become a reality in other countries as well. With the pandemic sinking the mainstream economy, governments are printing money like crazy. Imagine if most countries experienced hyperinflation. There will be extreme chaos never before seen in the course of human history! I hope that doesn't turn out to be the case, as the economy starts recovering after the demise of COVID-19. As far as Venezuela goes, it seems unlikely that its economy will recover after sinking so low. Only a change in government might save the day. In the meantime, expect the Central Bank of Venezuela to continue printing new denominations of the Bolivar as the economy continues in a downward trend. Just my opinion

[STT]

'Backed up'   This is the nature of all FIAT, of the dollar, the euro or almost any currency you want to talk about.   A zero coupon bond, you believe they will repay some kind of value but in effect you have no claim.    Between nations value might be demanded but eventually the tale for FIAT is that this is a failure and even worse for the people of each nation they never find the repayment of their labour and capital saved is returned properly.   Its very much a common complaint in every country western or failed nations like Venezuela that the working mans wage has fallen for decades and its related to failure deliberately for cheap debt purposes.   It undermines currency, capitalism, freedom and democracy and it makes nobody rich in the end we can be quite certain by the repetition across history.
   There was no link or demand on delivery for the Petro, it was nonsense in effect and even worse the system they designed was centralised.   It failed the basic standards of crypto much like XRP isnt crypto, its digital but its massively undermined for the purposes of those in control.

[South Park]

Without a doubt it is a bad idea but this is just more evidence the average person does not understand basic economic principles, it seems they think that just because governments are bigger than they are they can spend all the money they want and this is not true, governments still need to follow the same principles that any normal family would, they need to spend less than what they get on taxes and keep something for a rainy day as you say, but politicians are nothing more but a reflection of the society that elects them, so if the population does not understand this the politician most likely does not as well or at least does not care and that is how it begins the economic debacle of most countries.

Politicians constantly fail to lead. It's far easier to continue deficit spending than to balance the budget and make the hard decisions that need to be made in order to do so, especially since the only way to do this is to cut spending or raise taxes.  In the US, the budget is so unbalanced that it would take drastic spending cuts and drastic tax increases to balance the budget. The average person is generally too stupid to realize that failure to act now makes the situation worse in the future, and something will eventually give, and politicians are only interested in getting elected, so nobody is going to run on a platform of doing what needs to be done to get our finances in order.

Correct, anyone doing that will commit political suicide and that is because people do not want to listen to the truth, they want to be told that the government can take care of everything and tax the rich if necessary not understanding that if the governments go after the rich too strongly they will just leave the country because they can do so, and not only they leave all the jobs they created leave with them generating unemployment and economic turmoil in the process, and unfortunately there does not seem to be a way out of this without a great deal of suffering during the next decades due to the reckless spending of the governments.

[stompix]

The average person is generally too stupid to realize that failure to act now makes the situation worse in the future, and something will eventually give, and politicians are only interested in getting elected, so nobody is going to run on a platform of doing what needs to be done to get our finances in order.

This is pretty interesting, I've seen a lot of blaming the politicians that don't have the courage to act because all they care about is to be elected, but they wouldn't be elected in the first place if people wouldn't be convinced they are better with this kind of policy than with a drastic reform, yeah politicians are putting their name on and voting laws but it's the people that put these people in a position of power with their vote.

And like it or not even in Venezuela's case or in many others the current failure of a government still has support, there are still people that even if they are dirt poor they are supporting it and if this nucleus is not broken then nothing will change, with a constant mass of brainwashed devote voters you don't need anything else. I've read numerous topics on how countries in Africa are lagging behind, and everybody is blaming the ruling class, but aren't those also African's, aren't those the same people you have voted for? Yeah, the situation in Venezuela can be blamed right now on Maduro, but it shouldn't be him the only one.

Venezuela can't seem to revive its economy, no matter what its efforts may be. Its latest attempt of creating a digital currency backed by oil reserves turned out to be a huge failure. They're better off using Bitcoin as a reserve currency to protect the economy. The Venezuelan Bolivar can be backed by Bitcoin directly, instead of printing new bills that would cause hyperinflation.

Do you know what that currency backed by oil has failed? Because nobody trusted them even for a moment they will indeed back it with all that oil. Do you think anybody will trust them if they claim they have it backed by bitcoins gold or diamonds? Nope.
Their currency is worthless because of the same thing, people don't trust it for being worth the same next day, there are far poorer countries than Venezuela out there and their currencies look almost flat compared to the bolivar, because as poor as they might be there is still some faith in them, in the bolivar there is none, neither in the word of their leader.

[Sithara007]

Well.. just one small question here. Why can't they just re-denominate their currency? Not saying that it is going to slow down the inflation rate, or keep more money in the treasury.. but having bills of 100,000 or 250,000 sound really weird. If I was the finance minister, then I would re-denominate the currency by a factor of 1 million. So the rate becomes 1 New Bolivar = $2.30. It is not going to last long.. but still, it is worth giving a try.

[SquallLeonhart]

Problem Venezuela has right now is not even at the levels where they should care about their bill or their currency meaning anything at all, it is more humanity related where people are starving to death and that is what they should be focusing on as a whole nation instead of caring about each individual.

Of course in a regular nation without any of these problems you would want people to have rights and chances and opportunities but right now they have hard time having enough simple life stuff like literally food, so they should focus on gathering as much money as possible as a government to use that money to bring in cattles and foods and more stuff from other nations without going even worse and using that to establish a base level to work from.

I believe this new bill deal would allow that to happen for a short period of time, it is not a great move but definitely doesn't look bad neither.

[stompix]

Well.. just one small question here. Why can't they just re-denominate their currency?

Because they tried, and not only once:

The Bolívar fuerte replaced the bolívar on January 1, 2008 at 1 bolívar fuerte for 1000 old bolívares.
On 20 August 2018, the Maduro government launched the new bolívar soberano currency,with one bolívar soberano worth 100,000 bolívares fuertes.

It is not going to last long.. but still, it is worth giving a try.

They tried it didn't last, I assume that right now they don't have the money to even come up with new designs for the notes let alone print them.
Also a funny fact, for a short period of time the coins in Venezuela were actually worth more than their value

There's 125,000 one bolivar coins to a tonne, so 8 million coins is 64 tonnes of coins. But given our rough metals value (and again, is is a rough value) of $7,000 a tonne then that's half a million dollars worth of metal that has been turned into coins. Those coins having a value of perhaps $20,000. Or, if you prefer, that's a net loss to the mint of $480,000 from making coins. Or, in the more technical jargon, that's reverse seigniorage.

Probably Venezuela was for a short time the only country that came close to having again a gold standard but with copper and nickel.  

[ultrloa]

People must act about this since they are the one who will suffer for negligence made by the government and if they keep their mouth shut upon this incident they will encounter more economical problem.

Their idea to create mo bills is so crazy thing what leader could think and I wonder if they have economic adviser advise them on what to do on how things gonna work if they create such decision like this.  And for what I see the intention for creating another bills is just for another corruption purposes only.

[STT]

Sad thing is these are not new troubles, these problems date back thousands of years.   The ancient Roman empire did the same thing, eventually coming close to an enslavement of all citizens who were not soldiers.   That empire destroyed itself because it was better for the people for this to happen.   The worst mistakes are repeated, timelessly and generations suffer for whatever is already known as as a mistake leading to inevitable failure mostly because a few in power benefit.   

Because they tried, and not only once:

The Russian Rouble is convertible from the old Rouble for 10,000 to one if you should still have some.   In this way they can deny ever defaulting or collapsing.    I see QE programs as a way of doing this also, all debts are repaid but the value never is but you cant argue with a central and military backed system.   

for a short period of time the coins in Venezuela were actually worth more than their value

This is so common I can post up a wiki article relating to it.   Happened in european countries, in UK and USA most recently had silver coins which cannot be issued as the tradable value is far below.   I'll try and find the website for identifying market value exceeding face value.

https://www.investopedia.com/terms/g/greshams-law.asp

https://www.coinflation.com/silver_coin_values.html

Venezuela

The main point is these things happening in this country are obvious to us as leading to poverty but the wider take are these factors are occurring over almost the entire world daily.   There's no way I can afford to look down or dismiss the troubles of the people of Venezuela because its a natural phenomena that will visit us all.   Obviously I hope we do not have a military governance to stop corrections we the people require so that balance can be restored in an economy.

[kotajikikox]

Venezuela Planning New 100,000-Bolivar Bills Worth Just $0.23

Venezuela has begun to import banknote paper and is mulling plans to print bills with larger denominations as hyperinflation causes shortages of cash, according to six people with knowledge of the matter.

The country has brought in about 71 tons of security paper this year from an Italian printer majority owned by the private equity firm Bain Capital, according to some of the people and data reviewed by Bloomberg from Import Genius, which compiles customs records it obtains through private sources. The central bank is considering new bills starting with 100,000 bolivars, the people said. It would be the highest denomination yet, but still worth only $0.23.

https://www.bloomberg.com/news/articles/2020-10-05/venezuela-planning-new-100-000-bolivar-bills-worth-just-0-23

So spending fiat to produce more fiat, how ironic it is. It's just sad how this rich oil nation turn into another sad story because of the mismanagement from the sitting President.

And what's next $1 million Bolivar Bills just worth a dollar?

And it makes sense the Venezuelan are into bitcoin, with record breaking transactions like everyday.



https://twitter.com/BCV_ORG_VE/status/1314308916143104006

What's happening to venezuela as if they are not caring about their economy?do they think that it can uptrend their economic stand with this plans?
this will only brings BS to their country and i don't know who's idea all of these coming from.

People must act about this since they are the one who will suffer for negligence made by the government and if they keep their mouth shut upon this incident they will encounter more economical problem.

Venezuelan government is now making too much foolish decision and desperation,Hoping that their Path will go towards
 development and not for dumping country.

Their idea to create mo bills is so crazy thing what leader could think and I wonder if they have economic adviser advise them on what to do on how things gonna work if they create such decision like this.  And for what I see the intention for creating another bills is just for another corruption purposes only.

he is doing everything that he thinks can help but the truth is?this is making their country drowning more and more.

[bryant.coleman]

Probably Venezuela was for a short time the only country that came close to having again a gold standard but with copper and nickel.  

Well.. this happened around three decades ago, when the former USSR collapsed. Hyperinflation made the smaller denomination coins almost worthless, and therefore people melting them to valuable metals such as copper, aluminium and nickel. Even from India, there were reports of scrap dealers melting the smaller coins, to extract steel (which were then mostly used for manufacturing shaving blades).

[Spacewalker]

Probably Venezuela was for a short time the only country that came close to having again a gold standard but with copper and nickel.  

Well.. this happened around three decades ago, when the former USSR collapsed. Hyperinflation made the smaller denomination coins almost worthless, and therefore people melting them to valuable metals such as copper, aluminium and nickel. Even from India, there were reports of scrap dealers melting the smaller coins, to extract steel (which were then mostly used for manufacturing shaving blades).

Hyperinflation is generally a terrible and frustrating force, and the government has the ability to do this and cannot cope with hyperinflation afterwards. Social populism never gives good results in the end, and no external actions can be justified. The laws of the economy can be canceled only for a while, but they are all equally boomerned afterwards. Capitalism is safe and cruel in its manifestations, but social populism is even worse in the end.

[South Park]

snip

Venezuela can't seem to revive its economy, no matter what its efforts may be. Its latest attempt of creating a digital currency backed by oil reserves turned out to be a huge failure. They're better off using Bitcoin as a reserve currency to protect the economy. The Venezuelan Bolivar can be backed by Bitcoin directly, instead of printing new bills that would cause hyperinflation.

Do you know what that currency backed by oil has failed? Because nobody trusted them even for a moment they will indeed back it with all that oil. Do you think anybody will trust them if they claim they have it backed by bitcoins gold or diamonds? Nope.
Their currency is worthless because of the same thing, people don't trust it for being worth the same next day, there are far poorer countries than Venezuela out there and their currencies look almost flat compared to the bolivar, because as poor as they might be there is still some faith in them, in the bolivar there is none, neither in the word of their leader.

This, at the end this is all a confidence game and it is why the fiat system is still in place despite its huge flaws, people either do not see it or they do not want to acknowledge it, but what will happen once the system collapses? While in theory the same should have to happen to the fiat system than what it is happening to Venezuela and all the empty promises they give I still have my doubts this will happen to it as if things get as bad as some people in the forum speculate people will get desperate and they will be willing to accept anything as long as things go back to some semblance of normality.

[Twentyonepaylots]

Well.. just one small question here. Why can't they just re-denominate their currency? Not saying that it is going to slow down the inflation rate, or keep more money in the treasury.. but having bills of 100,000 or 250,000 sound really weird. If I was the finance minister, then I would re-denominate the currency by a factor of 1 million. So the rate becomes 1 New Bolivar = $2.30. It is not going to last long.. but still, it is worth giving a try.

And would also liven the people's trust over the country's currency. Another factor why the currency is not getting back up is the fact that people don't use it. If your population don't use your coins, it's not gonna be worth anything. This helps them get back the trust that was once lost and help Venezuela come back again in the face of the world economy as a recovering currency, not as a laughingstock

[bryant.coleman]

Probably Venezuela was for a short time the only country that came close to having again a gold standard but with copper and nickel.  

Well.. this happened around three decades ago, when the former USSR collapsed. Hyperinflation made the smaller denomination coins almost worthless, and therefore people melting them to valuable metals such as copper, aluminium and nickel. Even from India, there were reports of scrap dealers melting the smaller coins, to extract steel (which were then mostly used for manufacturing shaving blades).

Hyperinflation is generally a terrible and frustrating force, and the government has the ability to do this and cannot cope with hyperinflation afterwards. Social populism never gives good results in the end, and no external actions can be justified. The laws of the economy can be canceled only for a while, but they are all equally boomerned afterwards. Capitalism is safe and cruel in its manifestations, but social populism is even worse in the end.

The gulf states (such as Saudi Arabia and Kuwait) had many decades of extreme social populism, and look at what they have achieved. A large part of the Saudi population still remains poor, without adequate education or skill level. Now they are being forced to phase out the populist measures, as the oil prices are plunging. But the population got too used to it, and they are facing a lot of issues without the freebies.

[barbara44]

During the history of the world people did had this type of melting and making coins type of deal in all of history as well from all those nations that went down. Most famously when Constantinople was under siege, the king of eastern roman empire had basically no money left at all, there was no coins and there weren't all that many soldiers neither, so they had to hire soldiers from other nations, mainly Genoese soldiers with a famous captain.

When you need to pay mercenaries but have no money, what do you do? King ordered all of churches in the city to be raided by soldiers and everything valuable to be picked and brought to castle and melted in order to turn to copper, churches famously had everything gold during that period. So melting is not something new, it is old as it gets.

[South Park]

Well.. just one small question here. Why can't they just re-denominate their currency? Not saying that it is going to slow down the inflation rate, or keep more money in the treasury.. but having bills of 100,000 or 250,000 sound really weird. If I was the finance minister, then I would re-denominate the currency by a factor of 1 million. So the rate becomes 1 New Bolivar = $2.30. It is not going to last long.. but still, it is worth giving a try.

At this point it does not really matter, if inflation keeps being this high then sooner or later they will go back to the high denomination again, besides this will mean getting all of those notes out of circulation and that takes time and money, the measure you are proposing only makes sense once the period of hyperinflation is over and some sort of stability is reached, once that happens then they could redenominate their currency, but this seems like nothing but a dream right now as things will not improve until the current government is out of Venezuela.

[Abiky]

Do you know what that currency backed by oil has failed? Because nobody trusted them even for a moment they will indeed back it with all that oil. Do you think anybody will trust them if they claim they have it backed by bitcoins gold or diamonds? Nope.
Their currency is worthless because of the same thing, people don't trust it for being worth the same next day, there are far poorer countries than Venezuela out there and their currencies look almost flat compared to the bolivar, because as poor as they might be there is still some faith in them, in the bolivar there is none, neither in the word of their leader.

Yes I'm aware. Without trust in the government, any currency issued by the central bank will be deemed worthless. It's sad how the Venezuelan economy went down the drain after being vibrant a couple of years ago. Citizens will be obliged to use foreign currencies or even crypto to stay afloat. The Venezuelan government will continue to print money like there's no tomorrow. This will continue to plunge the value of the Bolivar in the mainstream world. I'd imagine a foreigner would become rich in Venezuela with US dollars. If $0.23 USD are worth 100k Bolivars, then with just $20 USD you'll become a millionaire (getting 8m Bolivars in return).

Anyhow, Venezuela's hyperinflation shows us that Fiat cannot be trusted. This could happen in other countries' economies if central banks continue to print money like crazy during pandemic times. Ultimately, people will trust precious metals (like Gold and Silver) and crypto more than Fiat currencies themselves. This is good as it decentralizes the mainstream economy. Time will tell us what will lie ahead with the future of the Venezuela with President Nicolas Maduro in power. My guess is that things will get worse until the demise of Maduro's regime. Let's hope Venezuela becomes democratic again so that it can get its economy back on track. Just my thoughts

[tyz]

Well.. just one small question here. Why can't they just re-denominate their currency? Not saying that it is going to slow down the inflation rate, or keep more money in the treasury.. but having bills of 100,000 or 250,000 sound really weird. If I was the finance minister, then I would re-denominate the currency by a factor of 1 million. So the rate becomes 1 New Bolivar = $2.30. It is not going to last long.. but still, it is worth giving a try.

This is happening when inflation is going out of control. In the end of the 1920s in Germany, there were bills which were worth 10 trillions. A year before such a bill was worth 100. The 10 trillion bill was enough to buy one bread. Next day, bread cost 50 trillions. Same happened a few years ago in Zimbabwe. Now in Venezuela, even though at slower pace.

[Sithara007]

Well.. just one small question here. Why can't they just re-denominate their currency? Not saying that it is going to slow down the inflation rate, or keep more money in the treasury.. but having bills of 100,000 or 250,000 sound really weird. If I was the finance minister, then I would re-denominate the currency by a factor of 1 million. So the rate becomes 1 New Bolivar = $2.30. It is not going to last long.. but still, it is worth giving a try.

This is happening when inflation is going out of control. In the end of the 1920s in Germany, there were bills which were worth 10 trillions. A year before such a bill was worth 100. The 10 trillion bill was enough to buy one bread. Next day, bread cost 50 trillions. Same happened a few years ago in Zimbabwe. Now in Venezuela, even though at slower pace.

An unpopular opinion here.

In case they are unable to maintain the value of the national currency, why can't they make some foreign currency as the legal tender? I am talking about currencies such as US Dollar and Brazilian Real. If I am not wrong, Zimbabwe allowed its citizens to use USD and South African Rand after its currency got heavily devalued. Why can't Venezuela do the same, rather than printing banknotes which are worth less than toilet paper?

[Ridcan]

wow.  100,000 bolivars only 23 cents?  It is too bad to import even the paper needed for printing money from Italy.  It is now better understood why cryptocurrencies are so important.  people consider their money as bitcoin against the melting value every day and I think it makes a lot of sense.  I found the subject very interesting.

[Vishnu.Reang]

wow.  100,000 bolivars only 23 cents?  It is too bad to import even the paper needed for printing money from Italy.  It is now better understood why cryptocurrencies are so important.  people consider their money as bitcoin against the melting value every day and I think it makes a lot of sense.  I found the subject very interesting.

Nothing wrong in importing the printing paper. You may be surprised to learn that the vast majority of the UN members don't print currency in their countries. The banknotes are printed by foreign agencies such as De La Rue (which provides banknotes to almost 140 different countries). So the case with Venezuela is a bit more advanced. They are not outsourcing the printing and they are doing it within their borders.

[oHnK]

Well.. just one small question here. Why can't they just re-denominate their currency? Not saying that it is going to slow down the inflation rate, or keep more money in the treasury.. but having bills of 100,000 or 250,000 sound really weird. If I was the finance minister, then I would re-denominate the currency by a factor of 1 million. So the rate becomes 1 New Bolivar = $2.30. It is not going to last long.. but still, it is worth giving a try.

This is happening when inflation is going out of control. In the end of the 1920s in Germany, there were bills which were worth 10 trillions. A year before such a bill was worth 100. The 10 trillion bill was enough to buy one bread. Next day, bread cost 50 trillions. Same happened a few years ago in Zimbabwe. Now in Venezuela, even though at slower pace.

An unpopular opinion here.

In case they are unable to maintain the value of the national currency, why can't they make some foreign currency as the legal tender? I am talking about currencies such as US Dollar and Brazilian Real. If I am not wrong, Zimbabwe allowed its citizens to use USD and South African Rand after its currency got heavily devalued. Why can't Venezuela do the same, rather than printing banknotes which are worth less than toilet paper?

Right, I would rather agree if the adoption of another currency in the country of Venezuela is legalized than printing more money.  Currency redomination will also not help much as the government also has to print large amounts of money.  In addition to requiring greater costs to print new money, the government must be prepared to overcome the additional inflation problem due to a decrease in people's purchasing power.

[Nellayar]

We don't surprise anymore if Venezuela will collapse its country at its doom one day. They can't control the inflation once they print and print of paper money. They increasing of purchasing power of individual will help for the price of the goods and products increases. It is not new anymore since Venezuela is one of the country that has corrupt officials. I fear for the future of their citizens if one day they will decline and their country will no longer have the chance to pay the debt. Corrupt government can devastate the whole country, they should be eradicated.

[South Park]

An unpopular opinion here.

In case they are unable to maintain the value of the national currency, why can't they make some foreign currency as the legal tender? I am talking about currencies such as US Dollar and Brazilian Real. If I am not wrong, Zimbabwe allowed its citizens to use USD and South African Rand after its currency got heavily devalued. Why can't Venezuela do the same, rather than printing banknotes which are worth less than toilet paper?

This is simple, because doing such thing will be like an admission they have destroyed the economy and they will be unable to blame anyone else, this also means they lose one of their greatest tools to acquire power for themselves, also while this was allowed in Zimbabwe by the government the truth is they had no choice as this was the reality on the ground and they just made it official, but then they tried to reintroduce their currency and you probably know what happened next right?

[Vishnu.Reang]

This is simple, because doing such thing will be like an admission they have destroyed the economy and they will be unable to blame anyone else, this also means they lose one of their greatest tools to acquire power for themselves, also while this was allowed in Zimbabwe by the government the truth is they had no choice as this was the reality on the ground and they just made it official, but then they tried to reintroduce their currency and you probably know what happened next right?

LOL.. everyone knows that the Venezuelan economy is completely destroyed. Whether they want to admit it or not is another thing. If they use a foreign currency, at least it will reduce the financial burden of the government. As far as I know, these banknotes cost more to print, when compared to their actual value. And by the way, I heard that Venezuelan Bolivar is the only currency in the world that is protected from counterfeiting. The reason is very simple. It costs more than its actual value to do the counterfeiting.

[Mauser]

We don't surprise anymore if Venezuela will collapse its country at its doom one day. They can't control the inflation once they print and print of paper money. They increasing of purchasing power of individual will help for the price of the goods and products increases. It is not new anymore since Venezuela is one of the country that has corrupt officials. I fear for the future of their citizens if one day they will decline and their country will no longer have the chance to pay the debt. Corrupt government can devastate the whole country, they should be eradicated.

Venezuela has so many natural resources and still it's such a poor country with so many economic problems. I am starting to believe that a dooms day wouldn't be so bad. Starting from scratch seems kind of easier that trying to fix the current mess. There is so much corruption going on at the moment that it might be easier to just get rid of all the officials right now. I really hope Venezuela gets its act together.

[South Park]

This is simple, because doing such thing will be like an admission they have destroyed the economy and they will be unable to blame anyone else, this also means they lose one of their greatest tools to acquire power for themselves, also while this was allowed in Zimbabwe by the government the truth is they had no choice as this was the reality on the ground and they just made it official, but then they tried to reintroduce their currency and you probably know what happened next right?

LOL.. everyone knows that the Venezuelan economy is completely destroyed. Whether they want to admit it or not is another thing. If they use a foreign currency, at least it will reduce the financial burden of the government. As far as I know, these banknotes cost more to print, when compared to their actual value. And by the way, I heard that Venezuelan Bolivar is the only currency in the world that is protected from counterfeiting. The reason is very simple. It costs more than its actual value to do the counterfeiting.

Yes everyone knows it including themselves and their citizens but they always blame the US and other financial institutions of their problems instead of blaming their own policies, using the US dollar as the official currency of the country basically means they will be losing their biggest scapegoat and then people are going to wonder, if the US was trying to sink us why are we using their money instead of our own? And they will finally realize that the government of Venezuela is the direct responsible of what it is happening in the country, obviously a lot of people know this already but there is still a lot of people that think otherwise and that will not believe it until this happens.

[k@suy]

We don't surprise anymore if Venezuela will collapse its country at its doom one day. They can't control the inflation once they print and print of paper money. They increasing of purchasing power of individual will help for the price of the goods and products increases. It is not new anymore since Venezuela is one of the country that has corrupt officials. I fear for the future of their citizens if one day they will decline and their country will no longer have the chance to pay the debt. Corrupt government can devastate the whole country, they should be eradicated.

Yes too much money in the circulation is not good, it can affect the value of their currency, they should stop thatif they want to save their economy, they should think first before making this thing, I wonder why they did this, they don't have any economist in the board? that's why it happens?  their country can be fall into debt for them to support their countrymen.

[STT]

Excess currency represents in-efficiency ultimately, its a failure to hold a standard of exchange and so fails the usage case for money as a proxy and utility enhancer in trade.   Think of the original purpose of money, to allow better division and accuracy when pricing and exchanging goods, especially between nations this has proved vital and of benefit to all in a process mentioned by Comparative advantage centuries ago yet we still fail to live upto this standard.     They have destroyed business and trade possible by creating failure of value within the currency exchange, this is always the problem with large governments that they interfere and cost the people far too much and become like leeches on honest sections of the country.

[pankowri]

The more corrupt the country is, the more they need paper money. Corruption is simpler that way, including for government officials. The government flattens employees' salaries to maintain superficial control of inflation and allows for further negotiations, criminal activities. No punishment. Many government officials receive more than their own corrupt wages.

Yes, Venezuela is already known as corrupted country by their government officials. The country has many potential such as their has enough oil to produce for the world. But they don't run in the right path so that they lost their potential and their officials proved as corrupted people. So the country needs some honest people to implement some rules for go ahead very shortly. Cryptocurrency can help them to go fast.

[Vishnu.Reang]

This is so sad and will probably not help at all. They should be trying to fix their economy instead of printing new money. Who is actually going to use such a bill? I saw in a documentary about Venezuela that most stores are not accepting bolivar anymore as a means of payment. Most restaurants and stores only accept USD these. Around 70% of the families have atleast one family member living abroad send money, usually USD to Venezuela.

Venezuela has so many natural resources that the country should be flourishing with the right government. They need to eliminate corruption and make new economic reforms to get back on track.

During the last 4-5 years, millions of Venezuelans have migrated abroad. Now there is a large Venezuelan community in Florida (which was very vocal in its support for Donald Trump, in the recently concluded presidential elections). But then, getting the USD banknotes to Venezuela can be a tricky game. As per the official policy, all the remittance payments must be converted to the national currency, once they reach Venezuela.

[arayde]

They should just stop printing cash, tis completely pointles. They already have cards/crypto, lets just use them and stop waste paper and inks

[Oneandpure]

They should just stop printing cash, tis completely pointles. They already have cards/crypto, lets just use them and stop waste paper and inks

Stop printing cash and have try to build bitcoin or their own coin become legal currency transaction because have enough how economic crisis in Venezuela after cash money is not worth and have inflation value, they have smart how to build digital economic and take part with create new coin based on Venezuela needed right now to bring back good value for the future without have inflation, if Venezuela keep using printing cash money they will always take inflation and playing by other country how to make Venezuela always need to borrow money from world bank and give higher fees transaction.

[uneng]

Venezuelan communist government thought they would have enough income to supply the regime forever just by selling raw oil.
Besides heavy assistentialism, high corruptions levels (what discourage external investors) and human rights violations, Venezuela also doesn't produce its own technology. Countries which are prosperous and thriving usually are specialists in cutting edge technology. That is the best way a country can boost its economy, generate jobs and keep the public expenses healthy.

And actually Venezuela isn't alone on this matter. Many other latin american countries such Argentina and Brazil are in bad economical situations. The same reasons could be pointed too: high corruption levels, lack of own technology development, high criminal levels...

[Stedsm]

I am more than worried about those Venezuelans who have gone all in on BTC. I mean, there's nothing wrong in making crypto a part of your life, but taking crypto as your whole life is stupid. And even if the government is taking shit steps like these $0.23 worth of Bolivar-bills release, I believe that going all in on BTC is not a good idea because if it ever gets crashed (and that's imminent tbh), the whole country will be there to suffer just like they are suffering from their current Government.

[Abiky]

Excess currency represents in-efficiency ultimately, its a failure to hold a standard of exchange and so fails the usage case for money as a proxy and utility enhancer in trade.   Think of the original purpose of money, to allow better division and accuracy when pricing and exchanging goods, especially between nations this has proved vital and of benefit to all in a process mentioned by Comparative advantage centuries ago yet we still fail to live upto this standard.     They have destroyed business and trade possible by creating failure of value within the currency exchange, this is always the problem with large governments that they interfere and cost the people far too much and become like leeches on honest sections of the country.

Exactly. Printing money like crazy will only devalue the currency. What makes something valuable is its scarce supply and exorbitant demand. Venezuela has been experiencing hyperinflation as a result of government's negligence. The Venezuelan Central Bank does not care about restoring the economy to its former glory. If it did, it would've either reduced the Bolivar's supply or adopted a foreign currency. Adopting a foreign currency such as the US Dollar or Bitcoin would've been the most ideal decision to make. As long as President Nicolas Maduro stays in power, Venezuela will continue to sink deeper.

Nonetheless, there's the fear that other countries might experience the same situation due to the coronavirus pandemic. Several countries have been printing money like crazy in order to save the economy from the effects of COVID-19. But what they're doing is essentially the same as Venezuela. If the trend keeps up, central banks will collapse leaving us with Gold and Bitcoin as the only valuable mediums of exchange. The centralized economy will be no more, as people will dive completely into the decentralized economy. Already, Venezuelan people are using crypto on top of the Bolivar for day-to-day payments (where DASH and Bitcoin are the predominant cryptocurrencies in the region). The same situation could happen in other countries if trust is lost in the current monetary system backed by central banks worldwide. Just my opinion

[Vishnu.Reang]

I am more than worried about those Venezuelans who have gone all in on BTC. I mean, there's nothing wrong in making crypto a part of your life, but taking crypto as your whole life is stupid. And even if the government is taking shit steps like these $0.23 worth of Bolivar-bills release, I believe that going all in on BTC is not a good idea because if it ever gets crashed (and that's imminent tbh), the whole country will be there to suffer just like they are suffering from their current Government.

It is their money and they can do whatever they want, as long as they are not doing anything illegal. Those who invested in Bitcoin, or converted their fiat currency or other assets to Bitcoin are currently sitting on top of at least 60% to 70% profits. So why do you need to worry? Obviously this was a very risky option, taking in to account the volatility and lack of legality of Bitcoin. But in the end, things worked out well for them.

[Dorodha]

Many believe that the mining sector in Venezuela has been destroyed by nationalization There is no state policy for this sector As a result, accidents often happen in these mines Venezuela is planning a new 100,000-bolivar bill priced at just $ 0.23. It is not good for crypto because their country does not support crypto and has no access to transactions. This will put it at risk in terms of mining. If Bitcoin is not supported will be difficult to convert to Fiat currency the Venezuelan currency the bolivar has now become virtually worthless paper.

[nomenclatur]

if the country is led by a wrong president then all that will be devastation like Venezuela this country is so rich in oil but now this country is hardly developed so much crime and also drugs there have been traded this country is so free and everything seems It will be worse if this continues. Corruption is also a problem for many countries which makes a country's economy worse.

[South Park]

They should just stop printing cash, tis completely pointles. They already have cards/crypto, lets just use them and stop waste paper and inks

It's not possible, what you say makes sense but only if all the population had access to those services but it is obvious that a country that is going through inflation at such a high rate is going to have people that are very poor and that do not have access to those services, so they need to keep printing cash, but I ask myself how long can discontinue? This country has been in disarray for years and yet the government remains in place, how long the people of Venezuela will allow this?

[AndySt]

if the country is led by a wrong president then all that will be devastation like Venezuela this country is so rich in oil but now this country is hardly developed so much crime and also drugs there have been traded this country is so free and everything seems It will be worse if this continues. Corruption is also a problem for many countries which makes a country's economy worse.

Corruption is not the main problem for Venezuela, and the root of the problem is the difficult internal political situation in the country, plus poor economic management, plus external influence. It is precisely the oil wealth that has become a curse for Venezuela, because falling oil prices no longer compensate for the shortcomings of public administration and social distribution as in previous years, and the pandemic that has come also adds its own colors to the picture of events. Also, let's not forget that Venezuelan oil is not as profitable as Saudi oil due to its chemical composition.

[STT]

That is corruption, central powers are by force controlling distribution of capital and production.  Only the people at the very top and possibly the army who keep their jobs are benefiting from this policy.    There are dangers in centralised systems and misdirection like this; capitalism and various distributed means of competitive industry are not perfect but do not dominate in a negative unstoppable way such as this.

Many believe that the mining sector in Venezuela has been destroyed by nationalization

Its very likely many industries are lacking investment or even out right ruined by mis-management over decades.  Venezuela has the worlds largest oil reserves, no other country has access to the depth of oil proven available in Venezuela; however there is a giant catch that it requires innovation and efficiency in the processing of the oil as it is sour not sweet or simply sourced like Saudi Arabia or those nearby countries have.    Venezuela is especially vulnerable to failings of big government, red tape and political ineptitude.    Even the best CEO in private industry can be replaced but a dictator and the failure which surrounds and is enforced by his regime never changes until total collapse, it is sad to see in an advanced nation with such giant potential waiting for the skilled and willing.

[Vishnu.Reang]

if the country is led by a wrong president then all that will be devastation like Venezuela this country is so rich in oil but now this country is hardly developed so much crime and also drugs there have been traded this country is so free and everything seems It will be worse if this continues. Corruption is also a problem for many countries which makes a country's economy worse.

The problem is not with their president, but with the system. Even when Hugo Chavez was the president of Venezuela, the system was the same. However, during that time the crude oil price was quite high and therefore they didn't had to bother about the budget deficit and the exchange rate of the national currency. Now the crude oil prices have nosedived and these things can't be maintained any longer.

[oHnK]

if the country is led by a wrong president then all that will be devastation like Venezuela this country is so rich in oil but now this country is hardly developed so much crime and also drugs there have been traded this country is so free and everything seems It will be worse if this continues. Corruption is also a problem for many countries which makes a country's economy worse.

The problem is not with their president, but with the system. Even when Hugo Chavez was the president of Venezuela, the system was the same. However, during that time the crude oil price was quite high and therefore they didn't had to bother about the budget deficit and the exchange rate of the national currency. Now the crude oil prices have nosedived and these things can't be maintained any longer.

No matter how good the president is, if he is only a single-player then a country will not survive. The government, the system and the people are an inseparable chain. The country can advance because of the successful cooperation between the government and society. A corrupt government comes from a corrupt society too. So that the leader is the image of the community itself.

[South Park]

if the country is led by a wrong president then all that will be devastation like Venezuela this country is so rich in oil but now this country is hardly developed so much crime and also drugs there have been traded this country is so free and everything seems It will be worse if this continues. Corruption is also a problem for many countries which makes a country's economy worse.

The problem is not with their president, but with the system. Even when Hugo Chavez was the president of Venezuela, the system was the same. However, during that time the crude oil price was quite high and therefore they didn't had to bother about the budget deficit and the exchange rate of the national currency. Now the crude oil prices have nosedived and these things can't be maintained any longer.

This is the truth, it seems that many people in Venezuela believe that if Chavez was still alive things will be better but that is not true, the system was the same and the problem that the people of Venezuela are facing is systemic, they depended in a very high price for oil and for a long time this happened so it seemed as if their system worked, but they never saved a single penny of their oil profits and when the price went down their system became unstable and impossible to maintain.

[Abiky]

This is the truth, it seems that many people in Venezuela believe that if Chavez was still alive things will be better but that is not true, the system was the same and the problem that the people of Venezuela are facing is systemic, they depended in a very high price for oil and for a long time this happened so it seemed as if their system worked, but they never saved a single penny of their oil profits and when the price went down their system became unstable and impossible to maintain.

Exactly. Venezuela has a flawed system. And the government hasn't done anything to remediate the situation. The Central Bank of Venezuela is going to need to copy other countries' economic models in order to keep the nation's economy afloat. Venezuela's allies (such as China and Russia) have a good economic system that has allowed them to stay ahead of the game (despite recent US sanctions). Maybe Venezuela could learn something from its allies in order to put an end to its economic crisis? There are many ways to "fix" the Venezuelan economy, limited to the government's own imagination. The Central Bank of Venezuela could simply rely on a foreign currency such as the US Dollar, Chinese Yuan, the Russian Ruble or on a decentralized cryptocurrency such as Bitcoin or Ethereum. It could also tie the Bolivar to the value of precious metals like Gold or Silver.

As long as no one does anything to save the Venezuelan economy, the country will continue to sink deeper. People will continue in poverty as chaos persists in the nation. At least, there are some people using crypto to protect themselves against the hyperinflation of the Bolivar. Expect to see more people adopting Bitcoin and Dash as a medium of exchange in the country, while the Bolivar goes down the drain. If the trend continues, there may be no one left using the Bolivar for day-to-day transactions. Once that happens, Venezuela will become the first crypto-only country in the world. Just my opinion

[South Park]

This is the truth, it seems that many people in Venezuela believe that if Chavez was still alive things will be better but that is not true, the system was the same and the problem that the people of Venezuela are facing is systemic, they depended in a very high price for oil and for a long time this happened so it seemed as if their system worked, but they never saved a single penny of their oil profits and when the price went down their system became unstable and impossible to maintain.

Exactly. Venezuela has a flawed system. And the government hasn't done anything to remediate the situation. The Central Bank of Venezuela is going to need to copy other countries' economic models in order to keep the nation's economy afloat. Venezuela's allies (such as China and Russia) have a good economic system that has allowed them to stay ahead of the game (despite recent US sanctions). Maybe Venezuela could learn something from its allies in order to put an end to its economic crisis? There are many ways to "fix" the Venezuelan economy, limited to the government's own imagination. The Central Bank of Venezuela could simply rely on a foreign currency such as the US Dollar, Chinese Yuan, the Russian Ruble or on a decentralized cryptocurrency such as Bitcoin or Ethereum. It could also tie the Bolivar to the value of precious metals like Gold or Silver.

As long as no one does anything to save the Venezuelan economy, the country will continue to sink deeper. People will continue in poverty as chaos persists in the nation. At least, there are some people using crypto to protect themselves against the hyperinflation of the Bolivar. Expect to see more people adopting Bitcoin and Dash as a medium of exchange in the country, while the Bolivar goes down the drain. If the trend continues, there may be no one left using the Bolivar for day-to-day transactions. Once that happens, Venezuela will become the first crypto-only country in the world. Just my opinion

I think that it is obvious that the government knows this and they are simply unwilling to implement anything that could solve the crisis, so the people of Venezuela have no other option except removing the current regimen from power, but unfortunately it seems that the elections are rigged as well so it seems that this is not going to happen in a peaceful way, but the situation in Venezuela is unsustainable and sooner or later something will have to be done and since all confidence on their own currency has been lost most likely people are going to see favourably the use of a third party currency as legal tender in their country.

[bryant.coleman]

This is the truth, it seems that many people in Venezuela believe that if Chavez was still alive things will be better but that is not true, the system was the same and the problem that the people of Venezuela are facing is systemic, they depended in a very high price for oil and for a long time this happened so it seemed as if their system worked, but they never saved a single penny of their oil profits and when the price went down their system became unstable and impossible to maintain.

The high oil prices prevailed for a long time, but the Venezuelan regime never bothered to build a rainy day fund. They splurged all that money on various expenses (some of them needless). Other oil producing countries such as Russia and Norway saved a part of the oil revenues for future usage, and you can see that these countries have fared much better when compared to Venezuela.

[TitanGEL]

Look what happened if there is hyperinflation in a certain country, it is so sad that there are a lot of people who are suffering because of what happened to the fiat currency of Venezuela wherein it almost loses its value, I think I saw one of their videos before wherein how hyperinflation affect their lives. I never thought an inflation will happened like that because I saw that they are using their fiat money to make crafts and they say that the crafts have more worth than the fiat money that they use in order to build it. I'm still thinking if how the Venezuela will reverse their situation wherein, they will back to their normal lives, a lot of people migrate to some countries because of what happened to their economy. I do not think that releasing a 100,000 is good because that is too big but for sure that their government have reasons of doing it.

[BTCappu]

This is the reason why crypto was created to begin with. I understand that Venezuela could be the extreme example (along with Zimbabwe for decades now as a joke) but the reality is that whatever is going in Venezuela right now happens in almost every single nation as well, just not as extreme.

When you look at Venezuela you see a nation where you could live decently (even if not great) before all of this happened, look at 10 years ago and you see it better, and when you look at it today you see that you require a lot more cash to buy toilet paper than the paper used for itself, so it is extreme, but look at world's greatest economical powers, USA, UK, Europe, China and all the likes and you will realize that what you can buy 10 years ago is not the same today with same amount of money, that is called inflation, and while few got richer during same period, many got poorer because of it.

[magneto]

And it makes sense the Venezuelan are into bitcoin, with record breaking transactions like everyday.

Unfortunately, that's what it takes for mainstream bitcoin adoption into day to day transactions - a massive crisis.

People don't realise that a stable fiat currency is the exception rather than the rule. A lot of people seem to take the stability/value of cash or cash equivalents for granted. Treausries are deemed to carry the riskfree rate or whatnot, even though there is always a serious risk of fiat depreciation.

I wonder what Venezuela is doing with their Petro at this point. They should probably move their fiat transactions onto a blockchain anyway so that the government can more efficiently revalue and debase the currency as required 

[Vishnu.Reang]

A few days back there was this news from Venezuela that the army is involved in Bitcoin mining.

https://news.bitcoin.com/venezuela-army-mining-bitcoin-for-unblockable-income/

I don't know how successful their efforts will be, as Venezuela is not producing any mining equipment currently. They need to import their mining rigs from foreign nations such as China and South Korea (which again is going to be difficult, as sanctions and embargoes are in place). I assume that they have surplus electricity which can be directed to these mining farms, but even then capital costs can be very significant.

[Abiky]

The high oil prices prevailed for a long time, but the Venezuelan regime never bothered to build a rainy day fund. They splurged all that money on various expenses (some of them needless). Other oil producing countries such as Russia and Norway saved a part of the oil revenues for future usage, and you can see that these countries have fared much better when compared to Venezuela.

Exactly. Other countries have fared much better than Venezuela when it comes to keeping the economy afloat. The oil industry is still a thriving one in today's society where electric cars and renewable energy are starting to emerge. The South American country (Venezuela) could simply invest into renowned oil companies in order to bring value to the Bolivar currency. There are so many ways to save the Venezuelan economy, limited to the government's own imagination. But I guess that the Venezuelan government does not care about reviving the economy after all. The country will continue in a downward trend until it collapses in its entirety. With so many people fleeing Venezuela, the population will reduce to a point where the country will fade from the face of the Earth (in the worst case scenario). At least, there are some people surviving in the country via the use of cryptocurrencies like Bitcoin and Dash. The more people avoid the Bolivar, the faster its demise will be. I'd imagine crypto will be used as the main medium of exchange in the country, leaving Bolivar in the dust.

Nonetheless, the ever-declining Venezuelan economy may be good news for foreigners. Outsiders might become rich in Venezuela with US Dollars or any other valuable currency like the Euro or Sterling Pound. As far as average citizens are concerned, I believe they'll have a hard time trying to survive in the country with a hyperinflated economy. Unless someone does something to save the nation, everything will go down the drain in a blink of an eye. Just my opinion

[Jating]

A few days back there was this news from Venezuela that the army is involved in Bitcoin mining.

https://news.bitcoin.com/venezuela-army-mining-bitcoin-for-unblockable-income/

I don't know how successful their efforts will be, as Venezuela is not producing any mining equipment currently. They need to import their mining rigs from foreign nations such as China and South Korea (which again is going to be difficult, as sanctions and embargoes are in place). I assume that they have surplus electricity which can be directed to these mining farms, but even then capital costs can be very significant.

I'm thinking what if the government themselves started this whole mining rigs and farms in their country and import directly from China? I'm sure that many nations are willing to help specially against US oppression in that region.

Although building this farm entail a lot of money and capital to begin with. But we will never know if Maduro himself is willing to try this strategy to get away from sanctions and embargo from the West.

[bryant.coleman]

Nonetheless, the ever-declining Venezuelan economy may be good news for foreigners. Outsiders might become rich in Venezuela with US Dollars or any other valuable currency like the Euro or Sterling Pound. As far as average citizens are concerned, I believe they'll have a hard time trying to survive in the country with a hyperinflated economy. Unless someone does something to save the nation, everything will go down the drain in a blink of an eye. Just my opinion

They have parliamentary elections scheduled for today, which the ruling party is expected to win. The opposition politicians including Juan Guaidó are boycotting the election and this means that Maduro and his allies may get an overwhelming majority. Now this also means that the US embargoes are there to stay and the Venezuelans will continue to suffer from hyperinflation.

[tbterryboy]

Being tied to other nations and price of your resources do not make a country independent and when you are not independent you are not a nation, you're a big company that could rise or bankrupt just like any other company. Look at Saudi Arabia for example, they had a lot of oil, and they still do have a lot of oil as well, but they used their oil income to purchase so many shares and stocks from huge companies, they made their rich people really rich by letting them invest into real estates and other stuff in other nations.

If you remove every single ounce of oil in Saudi Arabia today, they are going to be still very wealthy and they will still have income coming into their nation from all over the world. Hence never trust one resource you have, use that money to invest all over the world.

[Spaffin]

Nonetheless, the ever-declining Venezuelan economy may be good news for foreigners. Outsiders might become rich in Venezuela with US Dollars or any other valuable currency like the Euro or Sterling Pound. As far as average citizens are concerned, I believe they'll have a hard time trying to survive in the country with a hyperinflated economy. Unless someone does something to save the nation, everything will go down the drain in a blink of an eye. Just my opinion

They have parliamentary elections scheduled for today, which the ruling party is expected to win. The opposition politicians including Juan Guaidó are boycotting the election and this means that Maduro and his allies may get an overwhelming majority. Now this also means that the US embargoes are there to stay and the Venezuelans will continue to suffer from hyperinflation.

In any case, there is not a drop of the democratic movement in Venezuela that could influence Maduro's decision. If the government increases the money supply, which leads to hyper inflation, then what goals is it trying to achieve by these actions? This is not the real competence of the government, which really has great opportunities for the development of its economy, in the use of the US embargo.

[Abiky]

Being tied to other nations and price of your resources do not make a country independent and when you are not independent you are not a nation, you're a big company that could rise or bankrupt just like any other company. Look at Saudi Arabia for example, they had a lot of oil, and they still do have a lot of oil as well, but they used their oil income to purchase so many shares and stocks from huge companies, they made their rich people really rich by letting them invest into real estates and other stuff in other nations.

If you remove every single ounce of oil in Saudi Arabia today, they are going to be still very wealthy and they will still have income coming into their nation from all over the world. Hence never trust one resource you have, use that money to invest all over the world.

That's certainly true, mate. The Venezuelan government should've put its money to good use by investing in other companies and assets. By now, it would've been able to sustain its economy. Unfortunately, the sole dependence on the oil industry has led towards the country's demise. US sanctions and many other undesired situations have negatively impacted the Venezuelan economy. The only way to save the economy would be to peg the Bolivar to either Gold or Bitcoin in order to help mitigate the negative effects of inflation. But that decision would be up to the Venezuelan government and the central bank itself.

Nonetheless, many people living in Venezuela are starting to rely on alternative currencies in order to survive. There's been a rise in crypto usage within the region. Both Bitcoin and DASH have experienced massive adoption by Venezuelan people. They have lost their faith in the Bolivar currency, as well as, the government. It shouldn't be long enough before the Bolivar disappears, leaving the government with no choice but to rely on Gold or Bitcoin as the new medium of exchange. Just my thoughts

[Argoo]

Nonetheless, the ever-declining Venezuelan economy may be good news for foreigners. Outsiders might become rich in Venezuela with US Dollars or any other valuable currency like the Euro or Sterling Pound. As far as average citizens are concerned, I believe they'll have a hard time trying to survive in the country with a hyperinflated economy. Unless someone does something to save the nation, everything will go down the drain in a blink of an eye. Just my opinion

They have parliamentary elections scheduled for today, which the ruling party is expected to win. The opposition politicians including Juan Guaidó are boycotting the election and this means that Maduro and his allies may get an overwhelming majority. Now this also means that the US embargoes are there to stay and the Venezuelans will continue to suffer from hyperinflation.

It looks like the situation in Venezuela continues to deteriorate. Yesterday I heard information on the news channels that a bill of one million bolivars is already being printed in Venezuela. Thus, inflation in this country continues to rise sharply.
As long as the power crisis continues in Venezuela, the economic situation will only get worse. President Maduro needs to step down and call democratic elections. However, everything is not so simple. Russia alone has invested tens of billions of dollars in the Maduro regime.

[mrquackquack]

Anybody selling?

[Vishnu.Reang]

It looks like the situation in Venezuela continues to deteriorate. Yesterday I heard information on the news channels that a bill of one million bolivars is already being printed in Venezuela. Thus, inflation in this country continues to rise sharply.
As long as the power crisis continues in Venezuela, the economic situation will only get worse. President Maduro needs to step down and call democratic elections. However, everything is not so simple. Russia alone has invested tens of billions of dollars in the Maduro regime.

BS. First of all, Russia doesn't have that sort of money to invest in Venezuela (tens of billions of $$$  ). And secondly, if they had invested that much, then the situation would have been far better. The truth is that the Venezuelan society is deeply divided in to two camps. One camp supports Maduro and the socialists and they have managed to defeat the other camp led by Juan Guaidó, who is supported by the United States. It is up to the Venezuelans to elect their leaders, and we can't do anything about it.

[aysg76]

The inflation rates in Venezuela are very high and that's and grown almost 1300% over the years that's why they are printing new notes in the country but that will not match the balance.

Inflation chart

Actually they are suffering from hyper inflation and situation is getting worse day by day and President Maduro needs to take some economy friendly reforms to enhance the country growth

Millionaire in 50 cents

The Venezuelan currency is depreciating day by day due to rising hyper inflation in the country.

[bryant.coleman]

^^^ They don't have any foreign exchange reserves to support their currency, unlike the other nations. Venezuelan forex reserves were exhausted long back and no one is willing to purchase the currency at levels specified by the government. Black market rates are like 1,000 times higher than the official rates. And the government just doesn't care. They continue to print banknotes, as if everything is normal.

[Shasha80]

It is sad to know that Venezuela's economy is deteriorating, even though it was once considered one of the most prosperous countries.
But the result of years of misdirection of economic policies and corruption has triggered the collapse of the Venezuelan economy. Then make
Venezuela a poor country today. This has led many Venezuelan residents to leave their country for other countries, to get paid for another
country's currency which is more valuable than the Venezuelan Bolivar.

There is no other way to save the Venezuelan state in need of major changes in their economic system, the Venezuelan government must use
their national income to invest in assets that are capable of producing promising returns. Venezuelan government can buy assets of large companies
or Bitcoin. Because if Venezuelan government don't do this,  it will be difficult for the Venezuelan state to recover. Moreover, the government continues
to plan to print more money.

[Twentyonepaylots]

They are trying to print out new money in hopes of rejuventaing their currency and economy through money circulation, sadly I don't see this working at all especially since at this point, almost all Venezuelans are already using USD as their main currency, given the fact that Bolivars literally cost a lot more to produce than its worth

It is sad to know that Venezuela's economy is deteriorating, even though it was once considered one of the most prosperous countries.
But the result of years of misdirection of economic policies and corruption has triggered the collapse of the Venezuelan economy. Then make
Venezuela a poor country today. This has led many Venezuelan residents to leave their country for other countries, to get paid for another
country's currency which is more valuable than the Venezuelan Bolivar.

There is no other way to save the Venezuelan state in need of major changes in their economic system, the Venezuelan government must use
their national income to invest in assets that are capable of producing promising returns. Venezuelan government can buy assets of large companies
or Bitcoin. Because if Venezuelan government don't do this,  it will be difficult for the Venezuelan state to recover. Moreover, the government continues
to plan to print more money.

It has already deteriorated, Socialism is only good in paper but just like communism, it sucks in real life. Capitalism on the other hand is bad in paper, but fairly good in real life application. What they can do is to print out a new currency based on a different asset, that would cost a whole lot of money but it's a better choice than beating a dead horse that is the Bolivar.

[Sithara007]

It has already deteriorated, Socialism is only good in paper but just like communism, it sucks in real life. Capitalism on the other hand is bad in paper, but fairly good in real life application. What they can do is to print out a new currency based on a different asset, that would cost a whole lot of money but it's a better choice than beating a dead horse that is the Bolivar.

Socialism is not practical in real life. The basic concept of socialism is equal wealth for everyone, which will be impossible to implement. If everyone is allotted equal wealth, then why should anyone work? Those who work for 70 hours per week, and someone who stays at home and refusing to work will be paid equally. So what is the point in working hard? Eventually no one will do any productive activity and the government will run out of cash. And this is exactly what happened in countries such as Venezuela.

[mrquackquack]

Anyone selling some Bolivars let me know thanks.

[Kong Hey Pakboy]

Anyone selling some Bolivars let me know thanks.

What are you going to do with it though, the only thing that it can do as of this moment is become a fuel for fire. This wouldn't really come to this if the government prepared for an eventual price drop in oil but knowing that they don't want to do any work as the money pouring in is a lot, this is what happened. Not to mention that they failed to create projects that will benefit the whole community as most of the projects back when they were prospering is focused on individuals.

[bryant.coleman]

Anyone selling some Bolivars let me know thanks.

What are you going to do with the Bolivars? If someone ships you the banknotes from Venezuela to your home country, then the courier charges may be 100 times the actual worth of those banknotes. There was an article in The Guardian a few months back. They were claiming that one chicken costs some 14 million Bolivars in Venezuela. And this is what it looks like:

[Mauser]

Anyone selling some Bolivars let me know thanks.

What are you going to do with the Bolivars? If someone ships you the banknotes from Venezuela to your home country, then the courier charges may be 100 times the actual worth of those banknotes. There was an article in The Guardian a few months back. They were claiming that one chicken costs some 14 million Bolivars in Venezuela. And this is what it looks like:

I would be very careful with buying currencies during hyper inflationary periods, especially when it's physical currency. It might be very hard to sell the notes again and eventually might be worthless. The thing with countries who experience high inflation is that there is no end in sight. Once investors lose faith in a currency it is very hard to get it back.

[mrquackquack]

Just send me a message on here if interested. Thanks again.

[Vishnu.Reang]

I would be very careful with buying currencies during hyper inflationary periods, especially when it's physical currency. It might be very hard to sell the notes again and eventually might be worthless. The thing with countries who experience high inflation is that there is no end in sight. Once investors lose faith in a currency it is very hard to get it back.

There are people who collect foreign banknotes as a hobby. For them, Venezuelan Bolivar will have some value. One of my friends a few years ago purchased the "One hundred trillion Zimbabwe Dollar" banknote from ebay. This banknote has no value in Zimbabwe, but people were purchasing it just to keep it in their collection. So I guess it is the same with Bolivars as well.

[sunsilk]

I would be very careful with buying currencies during hyper inflationary periods, especially when it's physical currency.

It's possible that these people who are buying it are just for collecting purposes. It's part of history and having them will give you the pride that one day you've been holding that part of a historical moment when a lot of cash you have in your hand but the value is just cents.

It might be very hard to sell the notes again and eventually might be worthless. The thing with countries who experience high inflation is that there is no end in sight. Once investors lose faith in a currency it is very hard to get it back.

They knew where the value of these currency notes are going and that's why before it goes bad or it totally gets to zero, they own it. This is like owning a shitcoin but you actually holding it physically and thus, there's the historical value that you may earn it someday or just for the sake of owning it like having a toy collection.

[Sithara007]

They knew where the value of these currency notes are going and that's why before it goes bad or it totally gets to zero, they own it. This is like owning a shitcoin but you actually holding it physically and thus, there's the historical value that you may earn it someday or just for the sake of owning it like having a toy collection.

Yeah.. if you are owning a Zimbabwe Dollar or Venezuelan Bolivar banknote, you at least have something physical to keep with you. On the other hand, worthless shitcoins are digital assets and once they become dead, you don't have anything to keep with you. I had the misfortune of collecting some of these shitcoins in 2014/15, when I started with cryptocurrency. When they became worthless, I just abandoned the wallet. However, I have some worthless tokens still lying in my ERC-20 wallet. Can't get rid of them. There is no option to delete these tokens and if I want to throw them away, then I need to pay the gas price.

[Argoo]

It looks like the situation in Venezuela continues to deteriorate. Yesterday I heard information on the news channels that a bill of one million bolivars is already being printed in Venezuela. Thus, inflation in this country continues to rise sharply.
As long as the power crisis continues in Venezuela, the economic situation will only get worse. President Maduro needs to step down and call democratic elections. However, everything is not so simple. Russia alone has invested tens of billions of dollars in the Maduro regime.

BS. First of all, Russia doesn't have that sort of money to invest in Venezuela (tens of billions of $$$  ). And secondly, if they had invested that much, then the situation would have been far better. The truth is that the Venezuelan society is deeply divided in to two camps. One camp supports Maduro and the socialists and they have managed to defeat the other camp led by Juan Guaidó, who is supported by the United States. It is up to the Venezuelans to elect their leaders, and we can't do anything about it.

Russia sent its specialists to President Maduro, who helped create their Petro cryptocurrency in Venezuela, which is allegedly supported by Venezuelan oil. Russia has also invested about $ 10 billion in Venezuela's oil business, so it has become very interested in preserving the Maduro regime. When popular protests arose in this country, Putin sent his mercenaries to ensure the safety of Maduro.
Including with the help of Russia, the Maduro regime has so far survived. Meanwhile, banknotes of 200,000, 500,000 and 1,000,000 bolivars are being printed there.

[Vishnu.Reang]

Russia sent its specialists to President Maduro, who helped create their Petro cryptocurrency in Venezuela, which is allegedly supported by Venezuelan oil. Russia has also invested about $ 10 billion in Venezuela's oil business, so it has become very interested in preserving the Maduro regime. When popular protests arose in this country, Putin sent his mercenaries to ensure the safety of Maduro.
Including with the help of Russia, the Maduro regime has so far survived. Meanwhile, banknotes of 200,000, 500,000 and 1,000,000 bolivars are being printed there.

Russia doesn't have that sort of cash at hand. At the most, they might have purchased some amount of crude oil from Venezuela to sell it elsewhere. But $10 billion sounds too high. As the sanctions and embargoes are in place, it will be impossible for them to trade commodities worth this much. Sending mercenaries is something that Russia does very regularly. They have done this is countries such as Ukraine, Sudan, CAR, Syria and Libya.

[mrquackquack]

Oil in Venezuela?

[Ultegra134]

They knew where the value of these currency notes are going and that's why before it goes bad or it totally gets to zero, they own it. This is like owning a shitcoin but you actually holding it physically and thus, there's the historical value that you may earn it someday or just for the sake of owning it like having a toy collection.

Yeah.. if you are owning a Zimbabwe Dollar or Venezuelan Bolivar banknote, you at least have something physical to keep with you. On the other hand, worthless shitcoins are digital assets and once they become dead, you don't have anything to keep with you. I had the misfortune of collecting some of these shitcoins in 2014/15, when I started with cryptocurrency. When they became worthless, I just abandoned the wallet. However, I have some worthless tokens still lying in my ERC-20 wallet. Can't get rid of them. There is no option to delete these tokens and if I want to throw them away, then I need to pay the gas price.

What's the point of having worthless bills lying around? Unless you want them for display, because chances are, that these bills aren't and won't be worth anything in the future. They'll be purely cosmetic. Even the Venezuelans aren't using cash, because it's impossible to carry so many bills. Inflation is so high that they aren't even been used anymore.

[DrBeer]

It looks like the situation in Venezuela continues to deteriorate. Yesterday I heard information on the news channels that a bill of one million bolivars is already being printed in Venezuela. Thus, inflation in this country continues to rise sharply.
As long as the power crisis continues in Venezuela, the economic situation will only get worse. President Maduro needs to step down and call democratic elections. However, everything is not so simple. Russia alone has invested tens of billions of dollars in the Maduro regime.

BS. First of all, Russia doesn't have that sort of money to invest in Venezuela (tens of billions of $$$  ). And secondly, if they had invested that much, then the situation would have been far better. The truth is that the Venezuelan society is deeply divided in to two camps. One camp supports Maduro and the socialists and they have managed to defeat the other camp led by Juan Guaidó, who is supported by the United States. It is up to the Venezuelans to elect their leaders, and we can't do anything about it.

Russia has a lot of money. And the joke is that they have money for any idiotic projects, including the support of absolutely idiotic rulers, or even criminal regimes. But there is no money for its citizens! For them (the population of Russia) the retirement age is increasing, incomes, the level of social services, medicine, and education are decreasing. But they will allocate billions of dollars to support the inadequate Maduro. Such is the strange form of idiocy in Russia

[Vishnu.Reang]

Russia has a lot of money. And the joke is that they have money for any idiotic projects, including the support of absolutely idiotic rulers, or even criminal regimes. But there is no money for its citizens! For them (the population of Russia) the retirement age is increasing, incomes, the level of social services, medicine, and education are decreasing. But they will allocate billions of dollars to support the inadequate Maduro. Such is the strange form of idiocy in Russia

They undertake "idiotic" projects so that they will receive returns from it in the future. I am talking about projects such as Nord Stream 2 and Power of Siberia pipeline. These projects cost a lot of money, but ultimately they are going to benefit them. On the other hand, what are they going to gain from a bankrupt country such as Venezuela, where the currency notes are valued less than toilet paper? No one will be stupid enough to spend their money in such a country.

[mrquackquack]

Anybody know where to get Venezuelan Bolivars in the U.S.?

[bryant.coleman]

Anybody know where to get Venezuelan Bolivars in the U.S.?

You have a hobby of collecting banknotes and coins? In that case you can easily purchase Bolivar banknotes from Ebay. Else you can go for sites that are more specific, such as www.banknoteworld.com. I don't think that you will be able to purchase Bolivar banknotes from forex services (Western Union.etc), as Venezuela is currently under sanctions and embargoes imposed by the United States.

[Hispo]

As Venezuelan, I call tell you that people don't even use local currecy banknote here anymore. 

[Hispo]

Anybody know where to get Venezuelan Bolivars in the U.S.?

If I could, I would sell some I have to you.
I have got like half cabinet full of them. 

[Hispo]

Well.. just one small question here. Why can't they just re-denominate their currency? Not saying that it is going to slow down the inflation rate, or keep more money in the treasury.. but having bills of 100,000 or 250,000 sound really weird. If I was the finance minister, then I would re-denominate the currency by a factor of 1 million. So the rate becomes 1 New Bolivar = $2.30. It is not going to last long.. but still, it is worth giving a try.

We have already done that two times.

Back in 2007 (Removed three zeros)
And back in ... 2018, I think. (Removed five zeros)

So, in reality 1.000.000 Bs today is in fact 100.000.000.000.000 Bs

[bryant.coleman]

As Venezuelan, I call tell you that people don't even use local currecy banknote here anymore. 

So do you guys use US Dollar or Brazilian Real? A few months back I read that ordinary citizens are not allowed to keep their wealth in the form of foreign currency. Also, gold is very difficult to purchase. This can be disastrous for common people, when the currency is devaluing at a rate of 1000 times in a year. $1,000 worth of savings can be worth $1 after 12 months. So how do you guys get around these restrictions?

[Kittygalore]

As Venezuelan, I call tell you that people don't even use local currecy banknote here anymore.  

Is the inflation there still that bad? I looked at the Internet and saw that it is slowly stabilizing or is it just a fake story. Venezuela was a prosperous country back when the prices of oil were still good and I thought that they were ready when the oil prices were to go down.

[STT]

They have a military dictatorship for government and an economy, nothing is stabilising under that load.  All that can be said is the oil price rose a bit, as I understand it the military is involved in drug trafficking and benefits personally from that.   If you know rich people you might survive but the economy outside of that corruption is a failure.
  Venezuela has the largest proven oil reserves in the world, greater then the middle eastern countries but crucially its sour crude oil which needs refinement before use.   At best they would have efficient innovative industry but as the country is ruled by the gun its a failure getting worse because no investment can be made.

So how do you guys get around these restrictions?

The only way to deal in a country with failed currency is via barter, it becomes an agrarian economy probably and they transport raw goods across a border to trade elsewhere.  I dont suppose they survive very well otherwise.

[Hispo]

As Venezuelan, I call tell you that people don't even use local currecy banknote here anymore. 

So do you guys use US Dollar or Brazilian Real? A few months back I read that ordinary citizens are not allowed to keep their wealth in the form of foreign currency. Also, gold is very difficult to purchase. This can be disastrous for common people, when the currency is devaluing at a rate of 1000 times in a year. $1,000 worth of savings can be worth $1 after 12 months. So how do you guys get around these restrictions?

People in general has adopted the United State Dollar as a de facto currency co-existing with the Bolivar, we are allowed to hold foreign currency so that is what people use very often (businesses don't tag their products in Bolivars anymore, but in USD), people also use Bolivars but only digitally (debit accounts) to buy things, when one needs to use cash one uses Dollars, Colombian Pesos or Brazilian Reales in the case of the cities close to the borders.

The youth has also learnt how to use services like exchanges or providers of pre-paid cards in order to safe in USD and crypto-currency.

In general, we are allowed to carry USD (I have seen people paying for much food with 50$ and 100$ bills) but still there is a small chance to encounter a corrupt police officer/military which may seize the cash you carry with you, it happens but it is not a general problem yet.

[Hispo]

As Venezuelan, I call tell you that people don't even use local currecy banknote here anymore.  

Is the inflation there still that bad? I looked at the Internet and saw that it is slowly stabilizing or is it just a fake story. Venezuela was a prosperous country back when the prices of oil were still good and I thought that they were ready when the oil prices were to go down.

It has slowed down indeed, it was very wild back in 2016-2017. The prices of everything could easily double in a few days.
But now the inflation (even though still exists) is not going so fast as before, it is still devastating, though.

I personally believe our current political administration is quite bad, there are things that can't be blamed to oil prices...

[Sithara007]

People in general has adopted the United State Dollar as a de facto currency co-existing with the Bolivar, we are allowed to hold foreign currency so that is what people use very often (businesses don't tag their products in Bolivars anymore, but in USD), people also use Bolivars but only digitally (debit accounts) to buy things, when one needs to use cash one uses Dollars, Colombian Pesos or Brazilian Reales in the case of the cities close to the borders.

The youth has also learnt how to use services like exchanges or providers of pre-paid cards in order to safe in USD and crypto-currency.

In general, we are allowed to carry USD (I have seen people paying for much food with 50$ and 100$ bills) but still there is a small chance to encounter a corrupt police officer/military which may seize the cash you carry with you, it happens but it is not a general problem yet.

So the feeling I get is that owning US Dollar banknotes is de jure illegal, but not de facto. But this is grey area and issues can arise for ordinary people. As Hispo mentions, it makes them vulnerable to harassment from corrupt police officials (seizing the cash seems like daylight robbery). And this is also one of the reasons to store your wealth in digital assets such as cryptocurrency, rather than carrying around banknotes or bullion.

[tyz]

As Venezuelan, I call tell you that people don't even use local currecy banknote here anymore.  

Is the inflation there still that bad? I looked at the Internet and saw that it is slowly stabilizing or is it just a fake story. Venezuela was a prosperous country back when the prices of oil were still good and I thought that they were ready when the oil prices were to go down.

The country recently introduced the 1 million Bolivar bank note worth around $0.52. According to Reuters, the inflation rate was 2.7% in January, so if you consider a stable monthly inflation rate, then the extrapolated inflation rate is currently 32%. Compared to previous years, this is low, but still extremely high, and no one really knows if the data is not manipulated in some way.

[mrquackquack]

$.65 for the new 1,000,000 Bolivar Bill

[Vishnu.Reang]

$.65 for the new 1,000,000 Bolivar Bill

I don't understand the point in printing banknotes that don't have any value. If the 1 million Bolivar banknote is worth just $0.65, what is the point in printing it? I guess it will cost the government more than $0.65 to print and distribute these banknotes. And going by the inflation rate, the value of this banknote may become $0.10 or $0.05 in a couple of weeks. Why can't they just use the US Dollar or Colombian Peso?

[ivankoh]

Symptoms of inflation and debt in Venezuela were warned of failure in 2019. At the same time, epidemic covid 19 also made the economy worse.  This situation lasted until now.  Their central bank announced the issuance of new currency denominations of 200,000, 500,000 and 1 million Bolivars.  In fact, when looking at the par value fairly in developing countries is still at a "balanced" and acceptable price.  But when the embargo and escalation of evils are high, the request is not met and even 1 million Bolivars is equivalent to $ 50.  Unfortunately, foreign policies involving many specific issues have pushed this "oil-rich country" ship into a black hole.

[Hispo]

People in general has adopted the United State Dollar as a de facto currency co-existing with the Bolivar, we are allowed to hold foreign currency so that is what people use very often (businesses don't tag their products in Bolivars anymore, but in USD), people also use Bolivars but only digitally (debit accounts) to buy things, when one needs to use cash one uses Dollars, Colombian Pesos or Brazilian Reales in the case of the cities close to the borders.

The youth has also learnt how to use services like exchanges or providers of pre-paid cards in order to safe in USD and crypto-currency.

In general, we are allowed to carry USD (I have seen people paying for much food with 50$ and 100$ bills) but still there is a small chance to encounter a corrupt police officer/military which may seize the cash you carry with you, it happens but it is not a general problem yet.

So the feeling I get is that owning US Dollar banknotes is de jure illegal, but not de facto. But this is grey area and issues can arise for ordinary people. As Hispo mentions, it makes them vulnerable to harassment from corrupt police officials (seizing the cash seems like daylight robbery). And this is also one of the reasons to store your wealth in digital assets such as cryptocurrency, rather than carrying around banknotes or bullion.

It used to be de jure illegal, but it was made legal back in 2018 again, (many people of the political left did not like that), since then the usage has only increased and prices are not longer tagged in local currency. So it is not an underground thing as some may expect.

The police is corrupt in general, it is not a cash thing. If you are carrying something they like, they shall give you the stop and ask you for proof you own whatever you are carrying, in order to have an excuse to seize it: Cash, A new TV, Electronic instruments, you name it.

It has only happened to me once, stole a collectible german coin of mine 

[Hispo]

$.65 for the new 1,000,000 Bolivar Bill

I don't understand the point in printing banknotes that don't have any value. If the 1 million Bolivar banknote is worth just $0.65, what is the point in printing it? I guess it will cost the government more than $0.65 to print and distribute these banknotes. And going by the inflation rate, the value of this banknote may become $0.10 or $0.05 in a couple of weeks. Why can't they just use the US Dollar or Colombian Peso?

The point of printing those bills is that they are intented to people who do not have a stable income in USD or Cryptocurrency, so they only have their min wage, which is about 1$ montly.

Besides, there is something that is not commoinly mentioned in media: prices of food are lower is Cash (bolivars) in comparison to bank transferences, so people who earn Bolivars are encouraged to spend 2-3 hours in a line at the bank in order to get their 1$-2$ in cash (these new bills) in order to save 20%-50% when buying food. This something I have had to do in the past with my mother in order to save money.

This demand is theorized to come from the fact that our bills are used to counterfeit USD bills in countries like Colombia and other fishy things, because at this point our paper is free raw material for illegal things like that.

[STT]

I did not know the dollar was made legal for all, that is something at least.    Shame the dollar itself has quite severe inflation for anyone abroad and outside QE programs and so not close to the source; dollar also is constant money printing but its on a far lower rate.

then the extrapolated inflation rate is currently 32%. Compared to previous years, this is low, but still extremely high, and no one really knows if the data is not manipulated in some way.

Thats extreme inflation but its not hyper inflation.  This is a similar rate of inflation to the UK during the 1970's widely seen as a time of failure, closed industry, failing electric supply and striking labour forces; the IMF in that case had to assist in some kind of rescue to the country in order to avoid a collapse.

it will cost the government more than $0.65 to print and distribute these banknotes.

They can print a note for less then a cent probably, no other business can rival that kind of easy return.   Its the US 1 dollar which is made from cotton and has all kinds of costs that might exceed its face value

there are things that can't be blamed to oil prices...

The global oil price is lower then it should be, its a reflection of lower global growth and Im speaking of a decade view not recent upsets especially.   Obviously alternative energy sources will become more apparent but thats not the greatest explanation, oil is hard to beat on a calorific value just like coal is still useful a hundred years after its peak.   OPEC will continue to have a hard time keeping oil prices towards where they want them, its an ongoing challenge for every oil producer.

[LUCKMCFLY]

$.65 for the new 1,000,000 Bolivar Bill

I don't understand the point in printing banknotes that don't have any value. If the 1 million Bolivar banknote is worth just $0.65, what is the point in printing it? I guess it will cost the government more than $0.65 to print and distribute these banknotes. And going by the inflation rate, the value of this banknote may become $0.10 or $0.05 in a couple of weeks. Why can't they just use the US Dollar or Colombian Peso?

The point of printing those bills is that they are intented to people who do not have a stable income in USD or Cryptocurrency, so they only have their min wage, which is about 1$ montly.

Besides, there is something that is not commoinly mentioned in media: prices of food are lower is Cash (bolivars) in comparison to bank transferences, so people who earn Bolivars are encouraged to spend 2-3 hours in a line at the bank in order to get their 1$-2$ in cash (these new bills) in order to save 20%-50% when buying food. This something I have had to do in the past with my mother in order to save money.

This demand is theorized to come from the fact that our bills are used to counterfeit USD bills in countries like Colombia and other fishy things, because at this point our paper is free raw material for illegal things like that.

The main reason why the new flow of banknotes of that value becomes evident is because they do not reach the lowest denomination and there are not, they cannot print so many banknotes to reach the value of the dollar, which is the reference for the government, if If you make a banknote with a very high denomination, you can avoid so much paper for the best handling, but even so this is not enough, inflation will reach the value of the banknote in less than 1 month, which would cause much more inflation.

The government has dollarization only for them, not for the people, they only pay the people in Bs but everything, goods and services are in dollars, and the worst thing is that inflation is added to the dollar or any foreign currency, that is why the economy is impossible to control, actually as I see it, it has no solution in the traditional economy.

[Sithara007]

It used to be de jure illegal, but it was made legal back in 2018 again, (many people of the political left did not like that), since then the usage has only increased and prices are not longer tagged in local currency. So it is not an underground thing as some may expect.

The police is corrupt in general, it is not a cash thing. If you are carrying something they like, they shall give you the stop and ask you for proof you own whatever you are carrying, in order to have an excuse to seize it: Cash, A new TV, Electronic instruments, you name it.

It has only happened to me once, stole a collectible german coin of mine 

Cops are corrupt in most of the third world nations, and here in India things were much worse two decades ago. Even now we hear about isolated incidents once in a while, but in general the situation seems to have improved a little. A lot of things are in the grey area (neither legal, nor illegal) and the cops always make use of this loophole to loot the ordinary citizens. Arguing with them is a waste of time, and can be harmful to your health.

[Hispo]

I did not know the dollar was made legal for all, that is something at least.    Shame the dollar itself has quite severe inflation for anyone abroad and outside QE programs and so not close to the source; dollar also is constant money printing but its on a far lower rate.

then the extrapolated inflation rate is currently 32%. Compared to previous years, this is low, but still extremely high, and no one really knows if the data is not manipulated in some way.

Thats extreme inflation but its not hyper inflation.  This is a similar rate of inflation to the UK during the 1970's widely seen as a time of failure, closed industry, failing electric supply and striking labour forces; the IMF in that case had to assist in some kind of rescue to the country in order to avoid a collapse.

it will cost the government more than $0.65 to print and distribute these banknotes.

They can print a note for less then a cent probably, no other business can rival that kind of easy return.   Its the US 1 dollar which is made from cotton and has all kinds of costs that might exceed its face value

there are things that can't be blamed to oil prices...

The global oil price is lower then it should be, its a reflection of lower global growth and Im speaking of a decade view not recent upsets especially.   Obviously alternative energy sources will become more apparent but thats not the greatest explanation, oil is hard to beat on a calorific value just like coal is still useful a hundred years after its peak.   OPEC will continue to have a hard time keeping oil prices towards where they want them, its an ongoing challenge for every oil producer.

Oil prices will likely to increse after the virus gets under control, however the situation of my country as oil producer is fragile.
Our infrastructure is not prepared and our production has descended much, so private participation by companies like Shell, Chevron, and the Russian ones ect will increase.
We dont have the money to repair this ourselves.

[Hispo]

$.65 for the new 1,000,000 Bolivar Bill

I don't understand the point in printing banknotes that don't have any value. If the 1 million Bolivar banknote is worth just $0.65, what is the point in printing it? I guess it will cost the government more than $0.65 to print and distribute these banknotes. And going by the inflation rate, the value of this banknote may become $0.10 or $0.05 in a couple of weeks. Why can't they just use the US Dollar or Colombian Peso?

The point of printing those bills is that they are intented to people who do not have a stable income in USD or Cryptocurrency, so they only have their min wage, which is about 1$ montly.

Besides, there is something that is not commoinly mentioned in media: prices of food are lower is Cash (bolivars) in comparison to bank transferences, so people who earn Bolivars are encouraged to spend 2-3 hours in a line at the bank in order to get their 1$-2$ in cash (these new bills) in order to save 20%-50% when buying food. This something I have had to do in the past with my mother in order to save money.

This demand is theorized to come from the fact that our bills are used to counterfeit USD bills in countries like Colombia and other fishy things, because at this point our paper is free raw material for illegal things like that.

The government has dollarization only for them, not for the people, they only pay the people in Bs but everything, goods and services are in dollars, and the worst thing is that inflation is added to the dollar or any foreign currency, that is why the economy is impossible to control, actually as I see it, it has no solution in the traditional economy.

There is a detail that it is worth mentioning: Private business (specially franchises and nationwide companies) are paying their employers a wage in USD. It is no much (20$-200$ / month depending on the job) and it is paid in Bolivars at the day's rate in most of the cases.

However, the biggest employer within the country is the government, and they do not do this and simply pay the min wage plus some survival bonus and a bag of food in the best case scenario.

What you said is true, that is why people in general have a rough time when comes to trust their few dollars to the brand new USD bank accounts approved by the government.

[Hispo]

It used to be de jure illegal, but it was made legal back in 2018 again, (many people of the political left did not like that), since then the usage has only increased and prices are not longer tagged in local currency. So it is not an underground thing as some may expect.

The police is corrupt in general, it is not a cash thing. If you are carrying something they like, they shall give you the stop and ask you for proof you own whatever you are carrying, in order to have an excuse to seize it: Cash, A new TV, Electronic instruments, you name it.

It has only happened to me once, stole a collectible german coin of mine 

Cops are corrupt in most of the third world nations, and here in India things were much worse two decades ago. Even now we hear about isolated incidents once in a while, but in general the situation seems to have improved a little. A lot of things are in the grey area (neither legal, nor illegal) and the cops always make use of this loophole to loot the ordinary citizens. Arguing with them is a waste of time, and can be harmful to your health.

I thought India had this kind of moral problems under control, to be honest.
Through severe punishments to offenders in uniform.

[LUCKMCFLY]

$.65 for the new 1,000,000 Bolivar Bill

I don't understand the point in printing banknotes that don't have any value. If the 1 million Bolivar banknote is worth just $0.65, what is the point in printing it? I guess it will cost the government more than $0.65 to print and distribute these banknotes. And going by the inflation rate, the value of this banknote may become $0.10 or $0.05 in a couple of weeks. Why can't they just use the US Dollar or Colombian Peso?

The point of printing those bills is that they are intented to people who do not have a stable income in USD or Cryptocurrency, so they only have their min wage, which is about 1$ montly.

Besides, there is something that is not commoinly mentioned in media: prices of food are lower is Cash (bolivars) in comparison to bank transferences, so people who earn Bolivars are encouraged to spend 2-3 hours in a line at the bank in order to get their 1$-2$ in cash (these new bills) in order to save 20%-50% when buying food. This something I have had to do in the past with my mother in order to save money.

This demand is theorized to come from the fact that our bills are used to counterfeit USD bills in countries like Colombia and other fishy things, because at this point our paper is free raw material for illegal things like that.

The government has dollarization only for them, not for the people, they only pay the people in Bs but everything, goods and services are in dollars, and the worst thing is that inflation is added to the dollar or any foreign currency, that is why the economy is impossible to control, actually as I see it, it has no solution in the traditional economy.

There is a detail that it is worth mentioning: Private business (specially franchises and nationwide companies) are paying their employers a wage in USD. It is no much (20$-200$ / month depending on the job) and it is paid in Bolivars at the day's rate in most of the cases.

However, the biggest employer within the country is the government, and they do not do this and simply pay the min wage plus some survival bonus and a bag of food in the best case scenario.

What you said is true, that is why people in general have a rough time when comes to trust their few dollars to the brand new USD bank accounts approved by the government.

You're right, but that happens more than everything in the country's capital in Caracas, but internally the economy is clearly dollarized, that is, if you win 100 USD or 200 USD, you can not buy all items, foods in general, if it is a Family of 3 Yes, but an older family of 3, here is so uncontrolled the economy that includes inflation to foreign currency, is how I say, it is crazy, however, if there is a population that is very rich. .

Another part of the population depends on the remittances that send them from other countries, is an economy that the solution in traditional ecomonia does not have it, and without mentioning the medications that there are only, many people die due to lack of treatment.

[verita1]

You are totally right. The Venezuelan tries to survive to buy food and not all the basic items for a balanced diet. It is sad but it is true, also when there are health problems it is difficult for some to buy their medicines as one might suppose.
I still do not see a solution how the country can improve its economy. Venezuela has a potential in natural wealth, fertile land and others so that it alone can overcome its crisis.

[Vishnu.Reang]

Oil prices will likely to increse after the virus gets under control, however the situation of my country as oil producer is fragile.
Our infrastructure is not prepared and our production has descended much, so private participation by companies like Shell, Chevron, and the Russian ones ect will increase.
We dont have the money to repair this ourselves.

I believe that the only option left for the Venezuelan government is to again go for privatizing the oil fields. The national oil producer is in bad condition and it is unable to operate in a profitable and effective manner. At least the government should allow investment from friendly countries such as Russia and China, so that they will repair the infrastructure and boost the oil production. The government will also benefit, in the form of increased tax revenue. But I don't know whether the socialist government will take a favorable view about privatization.

[Hispo]

Yesterday, had to stay in a line for two hours for 4 bills of 500k Bolivars.
Barely any social distancing and the line was easily more than 600 people, outside the bank.

I believe I will have to go today as well..

[Hispo]

Oil prices will likely to increse after the virus gets under control, however the situation of my country as oil producer is fragile.
Our infrastructure is not prepared and our production has descended much, so private participation by companies like Shell, Chevron, and the Russian ones ect will increase.
We dont have the money to repair this ourselves.

I believe that the only option left for the Venezuelan government is to again go for privatizing the oil fields. The national oil producer is in bad condition and it is unable to operate in a profitable and effective manner. At least the government should allow investment from friendly countries such as Russia and China, so that they will repair the infrastructure and boost the oil production. The government will also benefit, in the form of increased tax revenue. But I don't know whether the socialist government will take a favorable view about privatization.

We already have private oil companies operating here, even Chevron.

https://www.chevron.com/worldwide/venezuela

Also, there is a low process of privatization people speculate how far it will get, though

[Leonardo7]

I thought the country wanted to go digital in their currency to fight inflammation. If Petrodollar has failed, why not the country adopt bitcoin as a major currency alongside their dead fiat to fight inflammation?. I understand the country has a major political crisis and riddled with corruption. Printing more fiat won't help the nation move forward.

[Sithara007]

I thought the country wanted to go digital in their currency to fight inflammation. If Petrodollar has failed, why not the country adopt bitcoin as a major currency alongside their dead fiat to fight inflammation?. I understand the country has a major political crisis and riddled with corruption. Printing more fiat won't help the nation move forward.

I don't think any country in the foreseeable future will make Bitcoin as the national currency. Why should they? With fiat currency, the government can print unlimited amounts of money and use it for various expenses. It suits bankrupt countries such as Venezuela. If they go for Bitcoin, then due to the principle of controlled supply, it is not possible to do that. I don't think that the Venezuelan government can afford to give any sort of legality on the usage of Bitcoin as a legal tender.

[awik p]

I thought the country wanted to go digital in their currency to fight inflammation. If Petrodollar has failed, why not the country adopt bitcoin as a major currency alongside their dead fiat to fight inflammation?. I understand the country has a major political crisis and riddled with corruption. Printing more fiat won't help the nation move forward.

In the past, their fiat currency had no value, so Venezuela uses cryptocurrency. Apart from the political crisis, Venezuela is slumped by the fall in oil prices that has occurred, so with the current advancement of bitcoin, hopefully their country will continue to grow.

[tyz]

I thought the country wanted to go digital in their currency to fight inflammation. If Petrodollar has failed, why not the country adopt bitcoin as a major currency alongside their dead fiat to fight inflammation?. I understand the country has a major political crisis and riddled with corruption. Printing more fiat won't help the nation move forward.

I don't think any country in the foreseeable future will make Bitcoin as the national currency. Why should they? With fiat currency, the government can print unlimited amounts of money and use it for various expenses. It suits bankrupt countries such as Venezuela. If they go for Bitcoin, then due to the principle of controlled supply, it is not possible to do that. I don't think that the Venezuelan government can afford to give any sort of legality on the usage of Bitcoin as a legal tender.

There won't be any because Bitcoin is not at all suitable as a currency for everyday use. There is no country in the world where you go to the bakery in the morning and pay with gold. Moreover, a country would give up its sovereignty over money. No politician would do that.

[sunsilk]

I thought the country wanted to go digital in their currency to fight inflammation. If Petrodollar has failed, why not the country adopt bitcoin as a major currency alongside their dead fiat to fight inflammation?. I understand the country has a major political crisis and riddled with corruption.

What they've adopted as an alternative currency is USD. And you cannot expect a country to adopt bitcoin that quickly, the government cannot rely on it because it is decentralized.

But the citizens, many of them have found survival on bitcoin because it's convertible to the dollar and it's easier for them to buy and sell through it.

Printing more fiat won't help the nation move forward.

That's why they are in hyper inflation.

[LUCKMCFLY]

I thought the country wanted to go digital in their currency to fight inflammation. If Petrodollar has failed, why not the country adopt bitcoin as a major currency alongside their dead fiat to fight inflammation?. I understand the country has a major political crisis and riddled with corruption.

What they've adopted as an alternative currency is USD. And you cannot expect a country to adopt bitcoin that quickly, the government cannot rely on it because it is decentralized.

But the citizens, many of them have found survival on bitcoin because it's convertible to the dollar and it's easier for them to buy and sell through it.

Printing more fiat won't help the nation move forward.

That's why they are in hyper inflation.

In Venezuela, the levels that were released according to the Caracol Noticias(TV) (Colombia) was that inflation is around 3800%, but to be more honest this amount exceeds 5000%, what happens is that the Central Bank of Venezuela does not Publish the true figure, because the Government prohibits it, obviously the country is dollarized, but it is a dollarization of another Universe, since the government does not pay wages and salaries in dollars but in local currency (Bs.S), for the province The country handles Dollars and Colombian Pesos (COP) this because of its proximity to the neighboring country, which in fact the border between Colombia and Venezuela through San Antonio del Táchira was the most active in the world, now people go through the "Trochas" in rafts improvised passing through a dangerous river, in search of their articles, food and basic articles, since in Colombia the prices are not so high and they are of good quality.

[Sithara007]

There won't be any because Bitcoin is not at all suitable as a currency for everyday use. There is no country in the world where you go to the bakery in the morning and pay with gold. Moreover, a country would give up its sovereignty over money. No politician would do that.

You are absolutely spot on. Bitcoin can be used as a payment, but it is not suitable for making day to day payments. The confirmation tome can vary from 5 minutes to 1 hour. Who is going to wait for this much time, to get his payment confirmed? Another issue is with the extremely high transaction fee. It's on the rise once again, and yesterday everyone was paying an average fee of around $20. Imagine paying this much as the fee for a coffee or burger, which itself costs just $3.

[jaysabi]

There won't be any because Bitcoin is not at all suitable as a currency for everyday use. There is no country in the world where you go to the bakery in the morning and pay with gold. Moreover, a country would give up its sovereignty over money. No politician would do that.

You are absolutely spot on. Bitcoin can be used as a payment, but it is not suitable for making day to day payments. The confirmation tome can vary from 5 minutes to 1 hour. Who is going to wait for this much time, to get his payment confirmed? Another issue is with the extremely high transaction fee. It's on the rise once again, and yesterday everyone was paying an average fee of around $20. Imagine paying this much as the fee for a coffee or burger, which itself costs just $3.

It’s efficient for transferring large values but not at all suitable for small transactions, which is why it isn’t suitable as a currency. Cross border transactions are are good use for speed and cost, but that doesn’t make it a good currency.

[Gyfts]

I always found Venezuela so interesting, because it can act as almost a "case study" as to how badly and quickly socialism can derail a country. The moment means of production were ran by government, the country's economy crashed (due to oil prices as well, but Venezuela put all of its eggs in one basket thanks to government control). Then what was left was citizens fighting with each other to eat stray dogs or competing for government sponsored rations of food.

[sunsilk]

~snip~

In Venezuela, the levels that were released according to the Caracol Noticias(TV) (Colombia) was that inflation is around 3800%, but to be more honest this amount exceeds 5000%, what happens is that the Central Bank of Venezuela does not Publish the true figure, because the Government prohibits it, obviously the country is dollarized, but it is a dollarization of another Universe, since the government does not pay wages and salaries in dollars but in local currency (Bs.S), for the province The country handles Dollars and Colombian Pesos (COP) this because of its proximity to the neighboring country, which in fact the border between Colombia and Venezuela through San Antonio del Táchira was the most active in the world, now people go through the "Trochas" in rafts improvised passing through a dangerous river, in search of their articles, food and basic articles, since in Colombia the prices are not so high and they are of good quality.

That means that the numbers that they're showing isn't the actual yet it's already high. But in actuality, it's even higher than what they're showing to the public and if that information from Caracol is for real, that's surprising although it's really hyperinflation.

I've watched a video about the citizens crossing borders and Colombia is where most of them are going because life and economy are better than their mainland.

[Vishnu.Reang]

It’s efficient for transferring large values but not at all suitable for small transactions, which is why it isn’t suitable as a currency. Cross border transactions are are good use for speed and cost, but that doesn’t make it a good currency.

Have to agree. A few days back, when the transaction fee was low I made a series of transactions with fee of 11-21 Sat/Byte. As per the current exchange rates, it cost me less than $1. I don't think that you can go much lower than this. If you keep your fee below 10 Sat/Byte, then there is a good chance that the transaction may never get confirmed. So the minimum you need to spend is $0.50-$1.00. That makes Bitcoin unsuitable for smaller transactions (i.e <$20).

[Hispo]

Then what was left was citizens fighting with each other to eat stray dogs or competing for government sponsored rations of food.

As Venezuelan, I must say that even though I have seen and heard some crazy things. That statement is not completely accurate if taken literally.

[Hispo]

It’s efficient for transferring large values but not at all suitable for small transactions, which is why it isn’t suitable as a currency. Cross border transactions are are good use for speed and cost, but that doesn’t make it a good currency.

Have to agree. A few days back, when the transaction fee was low I made a series of transactions with fee of 11-21 Sat/Byte. As per the current exchange rates, it cost me less than $1. I don't think that you can go much lower than this. If you keep your fee below 10 Sat/Byte, then there is a good chance that the transaction may never get confirmed. So the minimum you need to spend is $0.50-$1.00. That makes Bitcoin unsuitable for smaller transactions (i.e <$20).

That is why people here likely hold their Bitcoin in the long term and always have some spare alt-coin like Litecoin or Doge to buy the necessary daily things.

However, in spite of the transaction fees my country has one of the largest volumens of Bitcoin on P2P platforms and there is no doubt why.

https://es.cointelegraph.com/news/venezuela-is-the-leader-in-america-in-volume-of-bitcoin-and-in-traffic-to-p2p-crypto-platforms-according-to-google-trends

Cryptocurrency is even more meaningful for us because not only allow us to have some savings but also keeps the prying eyes of the government and criminals away from us.

[STT]

That makes Bitcoin unsuitable for smaller transactions (i.e <$20).

People are arguing BTC is not to be used for transactions in that way only in final settlement of a tab or bill paid over months that kind of thing.   That relies on credit and good will within those companies to customer relationships.    It seems obvious to me crypto overall needs to develop further, add more detail to payment layers to enable all parts of an economy.  I firmly believe the smallest entities of an economy are the most vital to have within crypto as the smallest businesses are the most able to double their size and revenue in one year and crypto requires that growth to justify itself.   If we get stuck on whales trading it will end badly imo

[Sithara007]

That is why people here likely hold their Bitcoin in the long term and always have some spare alt-coin like Litecoin or Doge to buy the necessary daily things.

However, in spite of the transaction fees my country has one of the largest volumens of Bitcoin on P2P platforms and there is no doubt why.

https://es.cointelegraph.com/news/venezuela-is-the-leader-in-america-in-volume-of-bitcoin-and-in-traffic-to-p2p-crypto-platforms-according-to-google-trends

Cryptocurrency is even more meaningful for us because not only allow us to have some savings but also keeps the prying eyes of the government and criminals away from us.

Well... how reliable and safe are these P2P platforms? I have been trading in P2P platforms since 2014 (in India), and I have faced issues with scammers multiple times. For example, once when I sold my coins the buyer marked the transaction as "paid", but I didn't received the amount in my bank account. I checked with him and then he was saying there is an issue with his bank and he needs some more time. These delaying tactics went on for some time, before I finally got my coins back through dispute resolution. Inexperienced users would have lost their coins in such circumstances. And if something goes wrong, then we can't even go to the local police station and report about it, because cryptocurrency is not 100% legal here.

[Hispo]

That is why people here likely hold their Bitcoin in the long term and always have some spare alt-coin like Litecoin or Doge to buy the necessary daily things.

However, in spite of the transaction fees my country has one of the largest volumens of Bitcoin on P2P platforms and there is no doubt why.

https://es.cointelegraph.com/news/venezuela-is-the-leader-in-america-in-volume-of-bitcoin-and-in-traffic-to-p2p-crypto-platforms-according-to-google-trends

Cryptocurrency is even more meaningful for us because not only allow us to have some savings but also keeps the prying eyes of the government and criminals away from us.

Well... how reliable and safe are these P2P platforms? I have been trading in P2P platforms since 2014 (in India), and I have faced issues with scammers multiple times. For example, once when I sold my coins the buyer marked the transaction as "paid", but I didn't received the amount in my bank account. I checked with him and then he was saying there is an issue with his bank and he needs some more time. These delaying tactics went on for some time, before I finally got my coins back through dispute resolution. Inexperienced users would have lost their coins in such circumstances. And if something goes wrong, then we can't even go to the local police station and report about it, because cryptocurrency is not 100% legal here.

I have used Binance P2P and there are groups with only trustworthy people who exchange Bolivars for Exchange credit, mostly Uphold which is very popular here. So far, I have not suffered a scam.

[bryant.coleman]

I have used Binance P2P and there are groups with only trustworthy people who exchange Bolivars for Exchange credit, mostly Uphold which is very popular here. So far, I have not suffered a scam.

I have heard that Binance P2P is more secure when compared to the other platforms. I have used Localbitcoins since 2012 and there were a few attempts to scam. And one thing I have learnt is not to blindly trust accounts that have very good feedback and high volumes. If such an account is indulging in scamming, there are two possibilities - either the account can be hacked, or the original owner has sold the account to someone.

[magneto]

Precisely why you need to hold some decentralised cryptos to hedge yourself against this sort of thing.

Might seem like a distant problem for people in first-world countries, but there has never been a fiat currency in the world that has survived in the long haul.

Debasement and eventual collapse is inbuilt. When the regime in charge is no longer credible, people no longer value the currency and fiat will topple to its ultimate, intrinsic value - zero.

Venezuelans have it tough right now. You could be next.

[LUCKMCFLY]

~snip~

In Venezuela, the levels that were released according to the Caracol Noticias(TV) (Colombia) was that inflation is around 3800%, but to be more honest this amount exceeds 5000%, what happens is that the Central Bank of Venezuela does not Publish the true figure, because the Government prohibits it, obviously the country is dollarized, but it is a dollarization of another Universe, since the government does not pay wages and salaries in dollars but in local currency (Bs.S), for the province The country handles Dollars and Colombian Pesos (COP) this because of its proximity to the neighboring country, which in fact the border between Colombia and Venezuela through San Antonio del Táchira was the most active in the world, now people go through the "Trochas" in rafts improvised passing through a dangerous river, in search of their articles, food and basic articles, since in Colombia the prices are not so high and they are of good quality.

That means that the numbers that they're showing isn't the actual yet it's already high. But in actuality, it's even higher than what they're showing to the public and if that information from Caracol is for real, that's surprising although it's really hyperinflation.

I've watched a video about the citizens crossing borders and Colombia is where most of them are going because life and economy are better than their mainland.

Yes, it is an extreme hyperinflation, in fact many who come from the center of the country flee because of the situation, because in the center of the country everything is more expensive and for some people it is impossible to get dollars, and the prices in dollars implement inflation, If a 1Kg of Sugar is worth 2usd, then they can put 2.5USD to 3USD, if demand increases, the truth is that the internal economy that is being formed is crazy. That is why many flee the country, just as there are others who come from the center of the country to go to Colombia to look for these foods and take them for their own consumption or sale.

[Sithara007]

Yes, it is an extreme hyperinflation, in fact many who come from the center of the country flee because of the situation, because in the center of the country everything is more expensive and for some people it is impossible to get dollars, and the prices in dollars implement inflation, If a 1Kg of Sugar is worth 2usd, then they can put 2.5USD to 3USD, if demand increases, the truth is that the internal economy that is being formed is crazy. That is why many flee the country, just as there are others who come from the center of the country to go to Colombia to look for these foods and take them for their own consumption or sale.

Hyperinflation will be there as long as the government doesn't support the national currency. They are just printing the banknotes and not supporting it at the forex market. As a result the banknotes have zero value. On top of that, most of the population now uses USD as a currency for making payments. It will be difficult to import anything in to the country, because of this situation. So it doesn't surprises me that imported items cost more.

[LUCKMCFLY]

Yes, it is an extreme hyperinflation, in fact many who come from the center of the country flee because of the situation, because in the center of the country everything is more expensive and for some people it is impossible to get dollars, and the prices in dollars implement inflation, If a 1Kg of Sugar is worth 2usd, then they can put 2.5USD to 3USD, if demand increases, the truth is that the internal economy that is being formed is crazy. That is why many flee the country, just as there are others who come from the center of the country to go to Colombia to look for these foods and take them for their own consumption or sale.

Hyperinflation will be there as long as the government doesn't support the national currency. They are just printing the banknotes and not supporting it at the forex market. As a result the banknotes have zero value. On top of that, most of the population now uses USD as a currency for making payments. It will be difficult to import anything in to the country, because of this situation. So it doesn't surprises me that imported items cost more.

If, in fact, the new bills are not so valuable, the paper money has more value, I believe that this economy has no solution, no economist has been able to find the solution, the experts believe that the only solution is that the government resign, and be taken by someone else with the opposite radical political ideology than they are now. The good thing is that there are no restrictions on the cryptocurrency economy, since the government itself has its bitcoin mining farms, the government has no way of generating liquidity, people no longer care that it is in hyperinflation, they only seek the way to generate business to attract more dollars.

[Hispo]

I have used Binance P2P and there are groups with only trustworthy people who exchange Bolivars for Exchange credit, mostly Uphold which is very popular here. So far, I have not suffered a scam.

or the original owner has sold the account to someone.

This should not even be legal, imo.

[Hispo]

Precisely why you need to hold some decentralised cryptos to hedge yourself against this sort of thing.

Might seem like a distant problem for people in first-world countries, but there has never been a fiat currency in the world that has survived in the long haul.

Debasement and eventual collapse is inbuilt. When the regime in charge is no longer credible, people no longer value the currency and fiat will topple to its ultimate, intrinsic value - zero.

Venezuelans have it tough right now. You could be next.

I agree.

You need to be careful wherever you all are from.
We never thought this could ever happen to us, we were in a very good position.

There were economical experts warning us about the future, about the long term consequences of our model and people did not care. They called them neo-liberals, imperialists and even facists just because they asked logical questions.

Where is the money gonna come from?
What if oil prices go down? We are too dependent on oil.
Are these debts with China going to hurt us in the future?
What if we diversify our economy first before increasing social programs?


Nowadays, they even try to take advantage of the increasing usage of crypto within the country to try to make their private party last a little bit more. If they could, they would track and force crypto-holders to pay unfair taxes, thank God their are too inefficient to do that.

[Sithara007]

I have used Binance P2P and there are groups with only trustworthy people who exchange Bolivars for Exchange credit, mostly Uphold which is very popular here. So far, I have not suffered a scam.

or the original owner has sold the account to someone.

This should not even be legal, imo.

Definitely not legal. But I can see a lot of Paxful, Localbitcoins, Bitcointalk accounts up for sale in various sites. Some of them may be put up for sale by those who hacked in to them. But at least some of the sellers would be the original owners of these accounts. And in 99% of the cases, the sold accounts would be used to scam someone. So the person who is selling this account is also responsible for fraud. BTW, an example here:

https://bitify.com/auctions/download-misc/a-localbitcoins-t2-verified-3779578/

[STT]

First time dealing with someone most people on there would ask to personally verify not rely on the site itself.   Also judge on recent feedback mostly not just legacy, its an ok site used with caution just costs to use it.   Ideally you would build up a relationship gradually with a trading partner not rely on them suddenly for an immediate large amount, do that regularly and you should be ok with a greater amount is best method.

It will be difficult to import anything in to the country, because of this situation. So it doesn't surprises me that imported items cost more.

This applies to every country that a trade balance is required to truly import and export goods at a reasonable price.   Because oil is so difficult to process and low demand now Venezuela has lost alot of its trade and so support for its currency in addition to all the other problems.   Dollar is already an inflationary trade by the time it arrives in the country and brings its own problems but also liquidity on global scale where as the national currency has become isolated and avoided in all trade for lack of integrity.
   If any loses use of currency barter becomes a better prospect for retaining value and crypto is easily better day to day for almost anyone who has to transport that value over distance.

[Vishnu.Reang]

^^^^ I agree with the previous posts, but why do Venezuela needs to import basic commodities such as sugar? Why can't they produce all this within their country? I have heard that Brazil is one of the top producers of sugar, so I guess the climatic conditions in Venezuela will also be favorable for sugar production. I just took one example, but I would like to know the reason why Venezuela imports most of the commodities from abroad.

[Hispo]

I have used Binance P2P and there are groups with only trustworthy people who exchange Bolivars for Exchange credit, mostly Uphold which is very popular here. So far, I have not suffered a scam.

or the original owner has sold the account to someone.

This should not even be legal, imo.

Definitely not legal. But I can see a lot of Paxful, Localbitcoins, Bitcointalk accounts up for sale in various sites. Some of them may be put up for sale by those who hacked in to them. But at least some of the sellers would be the original owners of these accounts. And in 99% of the cases, the sold accounts would be used to scam someone. So the person who is selling this account is also responsible for fraud. BTW, an example here:

https://bitify.com/auctions/download-misc/a-localbitcoins-t2-verified-3779578/

I see...

thanks for the example, I am quite new around here.

^^^^ I agree with the previous posts, but why do Venezuela needs to import basic commodities such as sugar? Why can't they produce all this within their country? I have heard that Brazil is one of the top producers of sugar, so I guess the climatic conditions in Venezuela will also be favorable for sugar production. I just took one example, but I would like to know the reason why Venezuela imports most of the commodities from abroad.

There was a time the government started to seize private companies and producers in order to advance into the socialist model and others things, obviously that affected the production, since those companies became useless because of the lack of management.

The sugar was a special case, because the producing plants were surrounded by a ton of corruption by the local authorities.

Nowadays, we are importing almost everything with consume, cigarettes, sugar, flour, cereal, lentis, ect. Specially processed products, there is no support to the local production neither by the government nor non-existant private investors. It is speculated that this is because, there are people in the government who profit from the importation of these goods. So they do not want local production to increase to keep their business