Venezuela Knocks Three Zeros Off Its Currency To Halt Hyperinflation -

Venezuela Knocks Three Zeros Off Its Currency To Halt Hyperinflation

Mar 25, 2018Jeremy ParkinsonFinance0

Redenomination is Venezuela’s sorry story of the day. It won’t work.

In a worthless attempt to halt hyperinflation, Venezuela Deletes Three Zeros From Its Failing Currency.

Socialist Venezuela is going through a crisis that has left people struggling to pay for food and find medicines. Prices are being influenced by a black-market exchange rate that rises by the day and is currently five times the nearly inaccessible official rate.

President Nicolás Maduro late Thursday briefly outlined his monetary rescue plan. In a country where a dozen eggs can cost 250,000 bolivars ($5) amid worsening inflation, he would chop three zeros off the currency — arguably bringing the price for those eggs down to 250.

By June 2, under Maduro’s plan, new bolivars with lower denominations would be circulated — but old ones, with denominations as high as 100,000, would remain valid. It would leave vendors charging two prices — one for old bills, the other for the redenominated bolivar.

Empty Shelves

Merchants are arrested if they charge too much for food. The result is no food.

Loot or Die

The Guardian reports ‘We loot or we die of hunger’: food shortages fuel unrest in Venezuela.

During the first 11 days of January the Venezuelan Observatory for Social Conflict, a Caracas rights group, recorded 107 episodes of looting and several deaths in 19 of Venezuela’s 23 states.

On Margarita Island dozens of people waded into the ocean and forced their way aboard a fishing boat, making off with its catch of sardines

In the city of Maracay, just west of Caracas, thieves broke into a veterinary school, stole two pregnant thoroughbred horses and slaughtered them for meat.

A recent video from the western state of Mérida shows a group of people cornering a cow before stoning it to death as bystanders yell: “The people are hungry!”

Price controls designed to make food more widely available to poorer people have had the opposite effect: many prices have been set below the cost of production, forcing food producers out of business.

in the western city of Maracaibo, residents recently swarmed into the streets, stopped two trucks filled with flour and candy, and emptied them.

“We either loot or we die of hunger,” one of the looters, Maryoli Corniele, told Diario la Verdad, the local newspaper.