Posts Tagged ‘U.S. Dollar vs. Bolivar’

Hugo Chavez vs. the U.S. Dollar: Micturating Into the Wind

January 27, 2010

Some people like to micturate into the wind. And some like to do it in the currency markets. And that’s really quite fine if they’re doing it with their own money. But when they are doing it with the life savings of the poor of an entire nation, in order to gratify their own grandiloquent self-conceptions, or in order to prove a politico-economic point which cannot be proven, then the tragedy imposed by the will of one man upon an entire people turns monumental. This is what Hugo Chavez has done to the working poor of Venezuela, in order to prove a Marxist point, and stick it to America, his (supposed) Capitalist opponent to the North. Bloomberg reports that Chavez has been massively selling U.S. dollars to artificially strengthen the Bolivar against the Yankee sawbuck, but after initially strengthening, the Bolivar has lost back 5%. Chavez, with the typical economic intelligence of the Communist, is massively selling dollars right when the U.S. dollar is  embarking on a long protracted strengthening, catalysed by the trifectal fillips of a sinking stockmarket (safehaven status), the coming necessity of higher interest rates to seemingly (and unsuccessfully) control inflation, and the coming scramble for dollars to service the massive amount of debt that has been underwritten in U.S. dollars. But Hugo Chavez will ignore these realities, thinking that his influence (and oil wealth) is so massive that he alone can move the currency markets. His is a “corpus gordo” about to take his place amongst the littered graveyard of traders and politicians who thought they knew better than the currency markets how those markets “must” go. He will continue to micturate into the wind of the currency markets, further impoverishing the Venezuelan people with inflation as big capital flees the country (Bloomberg reports $93 billion has left the country since 2005), while increasing unemployment because of the suddenly less competitive Venezuelan exports, due to any temporary increase in tthe Bolivar. Add to this that a stronger dollar usually means lower commodity prices, and that Venezuela is basically a commodity-export economy, and you have a formula for a very wet blowback as Chavez continues to micturate into the wind. It wouldn’t bother Silverwolf too much if the ureal mist only flowed into the face of Big Brother Hugo, but unfortunately its stinking drench will encompass the entire Venezuelan populace. This is the tragedy of Marxism, that economic misery is imposed on millions by government bureaucrats, destroying the labor of years, and the wealth of human energy and care that was invested in the currency. In the old days, they called it “theft”.

Hugo Chavez: another in the long list of histories arrogant micturators.

Hoooooooooooooooooooooooooooowwwwwww! — Silverwolf