Watching Venezuela Implode

These were moved around in Caracas ... I am guessing Russian surface to air missiles.
IMAGE(https://pbs.twimg.com/media/BhbV4_WIgAAN9p8.jpg:large)

From Twitter

Sparhawk wrote:

These were moved around in Caracas ... I am guessing Russian surface to air missiles.

You're right. They look like SA-3s.

That's really nuts unless protestors start flying like superman.
Perhaps they expect visitors like sympathetic military or the US.
Neither seem likely, so either really paranoid or just a broader redeployment making sure to put loyal regiments near the capital.

Maybe they are afraid of the US going for some air reconnaissance. Which they are probably doing. There is an increase of aircraft here.

Also this: Rubio Delivers Floor Speech On Crisis In Venezuela

Edwin wrote:

Big Picture

The guy in the first image isn't throwing a stone - he used the glove to grab the tear gas grenade (which is very hot) and he's throwing it back at the riot police. Ballsy.

The Maduro government has secured additional foreign financing, ostensibly for PDVSA infrastructure development. Goldman Sachs and BoA have both offered to lend money to the Venezuelan government. Given the current stalemate and continuing protests, I think this is going to initially come down to whether or not the government runs out of money and/or resources to fund its suppression efforts; long-term, the government is doomed unless they change course on currency and price controls, because their current stance will ensure that things keep getting worse.

Venezuelans marking themselves with numbers to keep food lines orderly.

(the original headline is "Venezuelans Are Marked With Numbers To Stand In Line At Government Supermarkets", but that's not entirely accurate.)

Caracas now facing water shortages and rationing.

Am still quite astonished how the world seems to just ignore what is going on there.
To be honest, I haven't followed things that closely either.
Besides the shortages (which were already there, but now seems even worse...),
what is the state of affairs atm? Any signs of the illicit government collapsing?
Or is the revolution dying more and more?

The world rarely cares about what happens in Latin America.

I don't keep up on LATAM much myself, but a college friend of mine has made writing and teaching about it his life's work, if anyone's interested:

Professional work
And the news site he started

Meanwhile, Venezuela's April inflation jumps to 5.7 percent.

And that's just April. In the running year prior, it's at 61.5%.

And, exactly as we told you would happen, right here in this thread a couple years back, the middle class is being destroyed. I saw a link a few days ago, but forgot to bookmark it, and can't find it now, but the percentage of Venuezuelans in poverty has increased from 1 in 4 to 1 in 3, and the process is accelerating.

This is what happens when governments try to live beyond their means by printing money.

They're also stealing billions from airlines.

You have to pay for what you use. If you don't, there will be consequences. If the theft is large enough, the consequences will be severe.

But Malor, can't they just print more money to pay back the airlines?

Yonder wrote:

But Malor, can't they just print more money to pay back the airlines?

Well, I think the US Treasury and Federal Reserve would be upset about the competition.

Because we've had runaway inflation due to money-printing in the US? I must have missed it...

We're not yet extracting more out of our economy by printing money than the economy can support.

We would, however, be seeing much more inflation if the other central banks of the world weren't actively maintaining the status quo, by printing their currencies to buy ours. They're importing our inflation.

Because we're so much bigger, it will take a lot longer for us to end up like Venezuela, but now that we're on that path, there's no getting off. At any given instant, the pain from stopping looks worse than the pain from continuing, so it will not be politically acceptable to stop until the inflation problem is incredibly severe.

This recent Forbes article may ease your mind, then.

As already mentioned, the most important inflationary episode in post-WWII history was that during the 1970s and early 1980s. From 1968 through 1972, consumer price inflation averaged 4.6%. Over the next ten years it was 7.5%. What happened? What caused this sudden and dramatic acceleration in prices? Did the Fed accidentally print too much money? As already explained, that can’t happen–you simply can’t raise the money supply above the demand. M did rise, however, and largely proportionally to the increase in P. This is a much more realistic story of those events.

As the price of oil skyrocketed, so costs of production rose for many, many US businesses. Because there is a lag between purchasing inputs and selling output, most firms have to borrow money (working capital) to bridge the gap. As the ripple effect of the OPEC price increases moved throughout the economy, the demand for cash by these businesses rose. Quite reasonably, private banks and the Fed did what they could to accommodate. These were fair requests on the part of US entrepreneurs. Loans were extended and government debt sold by the private sector to the central bank. This raised the supply of money. Therefore, the rising prices led to an increase in the supply of money and not the other way around. QE, QE II, and the federal government deficit cannot by themselves cause inflation.

Not poking at you here, Malor. No disrespect intended.

Wow, if only Maduro could read Forbes.

Mugabe would have liked it, too.

Note: when someone's livelihood depends on them not understanding something, it is exceptionally difficult to get them to understand it. Thus: Forbes can literally ignore economies blowing up right in front of them, because they're heavily invested in the mess the financial system has evolved into.

Lets get back to Venezuela

He's an economics professor of 27 years standing, Malor, not a reporter. His livelihood depends on getting economic information right.

Been awhile since I've posted here, hard to muster the energy to do so, after all I come to GWJ to unwind and chill, not to double-down on my country's own misery, however, the situation has gotten so much worse the last couple of months I can't help but think that the regime's collapse, which would drag the country into an uncertain, uncharted path, is nearer than ever. Oil prices are dropping, stocks are empty, people are doing lines for food and the pressure is building in a way unseen before.

Amidst this crisis Maduro arrives in Russia unnanounced hoping to score a bail-out agreement, Russia being Russia returns the favor by sending low-key officials to deal with the uninvited guest so Maduro leaves empty-handed for China, the Chinese government, having already lended more than $150.000M in different agreements that have been already squandered vaguely offers future investments in unnamed projects, but no Loan nor Bail-out.

Word is we can expect Maduro to return this week and further devaluate the bolivar, raise gas prices/cut gas subsidies (unthinkable years ago but given the situation not that far-fetched now) all the while claiming it is all the "empire's" and the "empire lackeys'" fault that the country is doing so bad.

Sorry to hear it, Feeank.

Best of luck, Feeank.

Sorry to hear that--keep us informed.

I do keep taps on how things are in Venezuela...didn't know it was already this bad. Good luck Feeank!

Reading the first page of the thread is instructive:

goman wrote:

Wrong. This is good for Venezuela economically. Real capitalists know.

Food smuggling is a thing now. http://www.stratfor.com/sample/situa...

Robear wrote:

He's an economics professor of 27 years standing, Malor, not a reporter. His livelihood depends on getting economic information right.

He's still ignoring an economy blowing up right in front of him. Again, read the first page of this thread, and think about who got it right, and who didn't.

Malor wrote:
Robear wrote:

He's an economics professor of 27 years standing, Malor, not a reporter. His livelihood depends on getting economic information right.

He's still ignoring an economy blowing up right in front of him. Again, read the first page of this thread, and think about who got it right, and who didn't.

As one of the people who thought goman had the right of it back then, it's clear things did not go the way he predicted. I wish goman (or someone else well versed in MMT) was around to explain these events from that perspective. Because right now it seems like everything is unfolding exactly as Aetius predicted.