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Topic Title: Venezuela issued a new currency to erase six zeros again, and 1 million deposits can only be exchanged for 500,000 cash
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Created On: 10/14/2021 04:25 AM
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 10/14/2021 04:25 AM
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Fish Killer

Posts: 54918
Joined Forum: 10/09/2005

Venezuela issued a new currency to erase six zeros again, and 1 million deposits can only be exchanged for 500,000 cash
INews
2021-10-14

Venezuela is preparing to issue a new currency again and remove zeros from the national currency to simplify daily transactions, which are sometimes almost impossible to display on a calculator or require multiple swipes to complete the purchase.

Venezuela issued a new currency to erase six zeros again, and 1 million deposits can only be exchanged for 500,000 cash

According to Bloomberg News quoted three sources on July 4, Venezuela's central bank plans to cut the bolivar by six as early as August after Venezuela's previous attempts to issue large-denomination banknotes failed to solve the economic and social problems caused by inflation. A zero and openly talk about these plans, which means that the U.S. dollar can be exchanged for 3.2 bolivars instead of the current 3219,000.

The last time Venezuela "re-priced" Bolivars was in 2018, and in March of that year began printing 1 million Bolivar banknotes, which are the largest banknotes in the country's history. But that paper bill is now worth only $0.32, which is not enough to buy a cup of coffee. Since 2008, Venezuela has removed 8 zeros from its currency because hyperinflation has destroyed people's savings.

Although Venezuela's previous attempts to restart the currency by eliminating the zero currency and printing new banknotes failed shortly after implementation, the recent series of reforms to slow consumer price increases may mean this time the reduction of the six zeros of the bolivar. It is more likely to stick to it, and readers and friends may not understand what happened behind this.

At present, Venezuela is presenting a spectacle to the world economic history. Although its proven oil reserves ranks the world's largest, according to IMF data, Venezuela's per capita GDP has fallen by 87% in the past ten years, from US$12,200 per year in 2011. At $1,540, oil has been the backbone of the country's economy for the past century. It prides itself on the textile industry, producing chemicals, cement, steel, aluminum, cocoa, coffee, and rice, but these have been in the past 20 years. Most of the industry has been destroyed.

Since at least the oil price drop in 2014, Venezuela's economy has been in a long-term crisis. Then, in 2017, the United States imposed financial sanctions on Venezuela, followed by the 2019 oil embargo and other follow-up measures. These external factors have severely affected the economic life of Venezuelans.

We have noticed that currently in Venezuela's social networks, most of the hot topics are related to power outages, food and medicine purchases, etc. The original Venezuelans who do not worry about eating and drinking, use gasoline for nothing, are beautiful like clouds, and do not have too much pressure in life. Suddenly the money used to buy a house is now only enough to buy a second-hand car; the money used to buy a car is now only enough to buy a refrigerator; the money used to buy a refrigerator is now not enough to go to a restaurant to eat a meal. This is now Venezuela's most economical economy. Real portrayal, for example, the diaper prepared for the baby can make a Venezuelan father carry an astonishing 8 million bolivars.

According to data, Venezuela's GDP in 2020 has shrunk by 25% in 2019 and has fallen by 15%. With the spread of coronavirus, oil demand is sluggish. This will be a serious problem for Venezuela, which mainly relies on oil, in its fiscal revenue and foreign exchange market. Shock.

This progress has exacerbated the economic difficulties of Venezuelans. The Economist magazine made a special report for us. The report stated that in the past two years, about three-quarters of Venezuelan citizens lost an average of 8.7 weight due to food shortages. In kilograms, even Ibarra, a professor at an institution of higher learning in the Venezuelan capital, cannot afford to repair shoes.

Because about 95% of Venezuela's foreign exchange income comes from oil exports. Since 2015, Venezuela has fallen into an economic crisis, plunged into a dollar shortage, and even reached the point of freezing oil, selling gold and drawing rights.

The direct economic consequence of this is that bartering in Venezuela has become the way of life of Venezuelans. For example, trading bread for medicine and diamonds for corn... has long been commonplace in Venezuela. However, even if the economy collapses so far, some people still make huge profits in the crisis.

For example, in the currency black market in Venezuela, due to the huge exchange rate gap and the emergence of the U.S. dollar shortage in the country, some merchants who are committed to currency speculation are making a fortune. They buy U.S. dollars on dips and then take off their gloves on the black market to make profits. Such currency speculation has made Venezuelan inflation even more severe, and even some people have quietly bet on Venezuelan investors who defaulted on debt and bought debt default insurance, thus making a lot of money.

To this end, a Bloomberg reporter also specifically reported a real case a few weeks ago, describing the process of a secret meeting between the reporter and the "cash dealers" on the black market. They used slang during the meeting to buy essential supplies. In this transaction, The reporter bought 500,000 bolivars in cash from black market dealers, but the irony is that the reporter needs to put 1 million bolivars into the dealer's bank account. This case is a stupid irony under hyperinflation, using money. To buy money, you need to pay insanely priced banknotes to get the cash banknotes you need from the black market.

Because, although the country now informally uses the U.S. dollar in many daily transactions, most Venezuelans can only get bolivars, and local currency is needed for things like buses, parking, and tips.

In such a severe environment, it is seeking economic reforms and another way to monetize the country's oil exports, but to seek economic reforms. This time, this country is not adopting economic reforms to reduce inflation or stabilizing the exchange rate of the domestic currency. Issuing petrocoins, hoping to quickly realize wealth from poor to rich and get out of economic difficulties to achieve a Jedi counterattack. The establishment of petrocoins will promote monetary sovereignty, facilitate financial transactions and break the financial blockade of the US dollar, and allow Venezuela to continue to be supported by rich minerals. Economic and social development.

However, the current news seems to indicate that the economy is beginning to improve, and Venezuela's economy will usher in a bottoming out. According to FT's report earlier this week, some economists believe that the Venezuelan authorities' decision to relax currency controls, import restrictions, and encourage informal dollarization has injected life into an economy that has shrunk by about 75% since 2013. In addition, there are also The news shows that the US authorities may relax sanctions, thereby promoting a rebound in the country's economic progress. Credit Suisse predicts that Venezuela's economy will grow by 4% in 2021, which will be the first year of growth since 2013.

According to a report by the Venezuelan newspaper two weeks ago, the President of Venezuela has ordered that oil is officially sold and settled in the international market in petro currency (Petro). The petro currency of each unit is linked to the price of the oil basket, and some sales have been signed. Oil, steel and aluminum contracts have become an alternative financial means to the U.S. dollar. At present, petrocoins have been pre-sold for 3.3 billion U.S. dollars, and it is planned to issue 100 million next. If calculated at the official exchange rate of 75 U.S. dollars per barrel of oil, Then the total value of these petro coins will exceed 7.5 billion.

Even at a time when the global food supply is tight, the Venezuelan authorities have also issued a loan of 560,000 petrocoins to fund agricultural production. This also means that through the issuance of petrocoins, it hopes to quickly change from poor to rich and get out of economic difficulties, and become the leader. A country that settles commodities in cryptocurrencies.

According to Bloomberg's Cafe con Leche index, after experiencing the second-longest hyperinflation in the country's history, the annual inflation rate fell from over 300,000% in 2019 to 2,339%. On a monthly basis, the monthly price increase slowed down to around 20.

People familiar with the matter said that with the rise of electronic payments in Venezuela, the new currency issued by the Central Bank of Venezuela should not print new banknotes like the previous "re-priced currency". They said the bank may launch six different denominations, ranging from 2 to 100 bolivars.

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Edited: 10/14/2021 at 08:01 AM by Fish Killer
 10/14/2021 08:23 PM
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Fish Killer

Posts: 54918
Joined Forum: 10/09/2005

...and all the demoshits want the USA to be just like Venezuela.

Truth

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 10/15/2021 01:45 AM
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Greensleeves

Posts: 18014
Joined Forum: 07/22/2003

Fuck of fat ass. Dems humiliated your sickly Orange turd of a gawd.

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 10/15/2021 04:23 AM
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follydude

Posts: 8724
Joined Forum: 07/25/2003

Speaking of Venezuela, what ever happened to the two former Green Berets who were caught as mercenaries in Operation Gideon last year?

Another T'rump failure.



 10/15/2021 06:43 AM
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tpapablo

Posts: 36533
Joined Forum: 07/25/2003

Well, it could be worse down there. At least they don't have Dementia Joe running things.

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