Venezuela - Ay, Caramba! British Spooks Up To No Good?

UK Accused Over Venezuela Court 'Spy Glasses' Posted on Friday 6 February 2015 Venezuela is seeking an explanation from Britain about a diplomat's role in an attempt to film the trial of an opposition protest leader using "spy glasses". The incident occurred during the trial of Leopoldo Lopez, who has been in jail for a year since leading protests against President Nicolas Maduro's socialist government. Violence during the demonstrations left 43 people dead, including demonstrators, Maduro backers and security officials. Lopez's father reportedly sneaked the recording glasses into a Caracas courtroom but was caught when they fell out onto the floor. "They're $20 glasses from Amazon made in China, not a NASA instrument!" said the father. "They don't allow recording by phone, but there's no rule against glasses. "But I was caught, and when one of the sheriffs pulled me out, I let the glasses drop and they fell on this British fellow who had nothing to do with it," he said. However, Venezuela's attorney general, Luisa Ortega, suspected deliberate conspiracy, demanding answers from Britain in what she described as an "irregular" incident with signs of international interference. "Episodes like this show there is a permanent effort to study ways of penetrating the Venezuelan state, destabilising and creating chaos and conflict," she said. The British embassy said the diplomat was not involved in the incident. [Well, they would.] "We strongly reject any suggestions of wrongdoing by the officer concerned," ambassador John Saville said. http://www.citytalk.fm/news/uk-and-world/20150206-uk-accused-over-venezuela-court-spy-glasses/ COMMENT Hilarious.  Latin American ambassadorial posts sound like lots of fun.

US Trying to Bring Veneuzuela Down / Biden Lobbying LatAm Countries, US Embassy Bribe, US Sanctions / Car Bomb

UNASUR to Review Evidence of US Interference in Venezuela Venezuela Venezuela's President Nicolas Maduro met on Wednesday with Secretary General of the Union of South American Nations (UNASUR), Ernesto Samper. Published 4 February 2015 (1 hours 15 minutes ago) Speaking following their meeting in Caracas, the blocs chief thanked the Venezuelan president for his willingness to create dialogue with the opposition. Venezuela's President Nicolas Maduro met with Secretary General of the Union of South American Nations (UNASUR), Ernesto Samper Wednesday in Caracas, asking the bloc's meditation on the interventionist actions carried out against the country by the United States. Maduro urged the United States to stop the aggressions and threats against Venezuela, saying his government is willing to initiate dialogue along with UNASUR in order to halt the violence in the South American country. Meanwhile the head of the regional bloc thanked Maduro for his willingness to ensure peace to Venezuela and said he will bring the evidence provided by the president's before UNASUR's Foreign Ministers Council. Samper also rejected any violent action threatening the country's stability and people. On Tuesday, Maduro said that he would seek to create a joint initiative between UNASUR and the Community of Latin American Nations (CELAC) in order to defend his country against interventionist measures carried out by the United States, which the leader maintains are aimed at toppling his government. The Venezuelan president said he had been told by other regional leader that U.S. Vice President Joe Biden had been telling other country’s to “isolate” Venezuela, adding that he had proof that the U.S. Embassy in Venezuela was attempting to bribe officials in order to turn against his government. The United States recently imposed new sanctions on the South American country, despite the unanimous declaration rejecting U.S. interference in the region at the recent CELAC Summit in Costa Rica. http://www.telesurtv.net/english/news/UNASUR-to-Review-Evidence-of-US-Interference-in-Venezuela-20150204-0037.html SEE ALSO That article has been pulled & is a dead link, but this is still visible on the Google news feed search. Hey, I wonder if this is the CIA trying to knock off Maduro?  Or maybe it's just a warning?   Read the article via the cache the other day.  From recollection, the device was reportedly found in the petrol tank but wasn't properly hooked up to explode. COMMENT Trust Joe Biden to have a hand in this, like he's got a hand in Ukraine. Venezuela must be going down. Keep an eye on this.

Venezuela - Economic Hassles Puzzle

Venezuela

• Top end South America
• (officially called the Bolivarian Republic of Venezuela (Do *not confuse with Bolivia)
• Colonised by Spain 1500s
• First to declare independence (1811 ... secured 1821)
• One of the most urbanised countries of Latin America
• ... world's largest oil reserves and [has] been one of the world's leading exporters of oil.
• Previously an underdeveloped exporter of agricultural commodities such as coffee and cocoa, oil quickly came to dominate exports and government revenues.
• 1980s oil glut = external debt crisis + long-running economic crisis
• (inflation peak @ 100% 1996)

[Source - Wikipedia - here]

------------------------------------------

Forbes Article - here.

Noticed high inflation in Venezuela, and having discovered 'hyperinflation' in the little tutorial, thought I'd check out Venezuela.

So their economy ... is what?  Either a depressed economy or a war economy, judging by tutorial? 

Background:

President Hugo Chavez (Socialist) died 2013. 

Venezuela is described as a 'South American oil giant' and the article indicates this isn't the worst economic period it's experienced. 

IMF makes an appearance. Inflation 'running rampant', according to IMF. Low economy growth. Economy shrinkage.

... devaluation of the currency in the case of Venezuela represents a reallocation of resources from the private to the public sector, which is practically the only exporter thanks to oil giant PDVSA.

If IMF has something to say, then there's most likely an IMF debt involved.

Moving onto the 2010 Article -  

Economist - 'Towards State Socialism' - here:

Article's dated, but it seemed to have good information.

GDP 'contracting' (less production); 'currency supply problem' mentioned. 

 Possible 'deepening' of recession mentioned. 

So, Venezuela's is a depressed economy.

Article indicates:  Decline in oil shipments associated with decline in oil export. There's also a decline in oil prices.  

[Don't understand how you can sit on oil but have a decline.]

The Economist

Chavez the socialist president (1999-2013) had progressively been nationalising everything:

... seizing everything from steel companies and bottle makers to housing schemes. When workers have protested, he has deployed the national guard against them. The government has justified the confiscations by saying that it was breaking up monopolies or stopping breaches of labour or environmental rules. But the aim appears to be to move decisively against what Mr Chávez calls “the oligarchy”...

2007/2008 Chavez government took over the private oil sector (and more) -- or what there was of it.

Economist reports that:

any bank which declined to “co-operate with national development” by assigning credit according to government priorities would also be taken over.

[Don't suppose they attract much investment, then?  Wouldn't most businesses shut shop?]

Country appears partly 'nationalised' (ie national/state property vs private property) -  some industry in govt hands and rest private hands. 

Govt portion GDP did nothing since the late 1990s .

Oil boom 2004-2008.

Nationalised companies are producing less than when they were in private hands.

To gain 'food sovereignty', most of the food industry has been nationalised, but (the Economist reports) there's been a steep increase in imports.

Couple of exceptions: milk company and telecommunications company ... have done well.

What tends to happen:

... once companies are in state hands their staffing levels rise, prices fall and they become dependent on government subsidies.

Construction industry damaged by slump in materials production since nationalisation.

'Housing schemes' slowed or stopped.  

Govt won't allow developers to ask for prices in line with inflation rises (as at 2010 article @ 30% -- now over 60%).

Govt took over what was already largely govt controlled oil industry:  production of crude and refined products dropped.

Article closes:

Polls suggest that most Venezuelans disapprove of the nationalisations and firmly support private property. But Mr Chávez seems to be following the advice of Alan Woods, a Welsh Trotskyist who has become an informal adviser. Mr Woods, who is better known in Caracas than Cardiff, publicly urged the president to respond to his electoral setback by “accelerating the revolutionary process”, expropriating land, banks and the main industries. Venezuelans had better brace themselves for more nationalisation, scarcity and economic decline.

So what is driving the the inflation rate?

I'd like to apply the inflation lesson, but I'm not sure I've got it.

Cost of production has risen - more employees; less efficiency; government subsidy of industry; so it's like bleeding out money and it costs more to produce the goods because bleeding out the money eats into the profits? Also, less goods are being produced. *NB also money going out on *imports*.

Checking out what the go is with the oil not moving, came across this article - Bloomberg Feb 2014 - here.

Bloomberg says:

Venezuela’s plummeting oil sales to the U.S., its biggest export market, are exacerbating a collapse in the nation’s debt securities. 

Bonds released by Venezuela 'sank'.  Sank doesn't sound too good. Don't know enough about bonds to judge why they 'sank'.  No idea what this is about.

Article goes on:

The tumble in oil exports, Venezuela’s biggest source of dollars, comes as President Nicolas Maduro faces a shortage of U.S. currency that’s caused consumer prices to soar 56 percent and foreign reserves to plunge to a decade-low of $21 billion. Petroleos de Venezuela SA, the state-run oil producer known as PDVSA, is sending hundreds of thousands of barrels a day to China to repay loans totaling more than $40 billion since 2008, at a time when its production is shrinking. 

When they're not producing as much oil, they're sending it to China to repay a debt and they're losing out on US trade they otherwise would have had (?) -- and on US currency (or is that just income, as opposed to a specific currency?) because of lost sales of oil to the US, which is driving the inflation.

Think I might need to do a bit more reading on Venezuela and on bonds, foreign reserves etc. because  have no idea.  LOL.

So far, it's been fun trying to figure it out.