How did Venezuela end up this way?

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How did Venezuela end up this way?

Post by 00dlez » Fri Oct 28, 2016 3:51 pm

I'm as lazy as the next guy - I knew in general what happened to Venezuela but the whole story, implications, and details were fuzzy for me. This podcast episode cleared things up a bit for me.... a good TLDR audio version. Perfect for someone who is unfamiliar and needs a quick way to catch up.

http://www.npr.org/sections/money/2016/ ... a-imploded
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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Sat Oct 29, 2016 7:55 am

I haven't hear the podcast, but well, I live there. Its messy and its going to get worse, pretty soon.

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Re: How did Venezuela end up this way?

Post by captain steinbrenner » Sat Oct 29, 2016 10:24 am

Communism happened, it's all you need to destroy a prosperous nation.

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Re: How did Venezuela end up this way?

Post by LowKey » Sat Oct 29, 2016 2:33 pm

DoctorCandelario wrote:I haven't hear the podcast, but well, I live there. Its messy and its going to get worse, pretty soon.
Hang in there.
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Re: How did Venezuela end up this way?

Post by doitnstyle1 » Wed Feb 15, 2017 1:39 am

Nightline is finally reporting on this. Special Edition on Venezuela.
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Re: How did Venezuela end up this way?

Post by The Twizzler » Wed Feb 15, 2017 7:35 pm

As a citizen and avoiding politics is there something you would like for outsiders to do to help? It seems the only fast fix would be a rise (double or triple) of current oil prices. I am aware of one other resource available there, a mining material found in large quantities for making Lithium batteries. I can't remember the name, but is there a reason this hasn't been tapped other than concern about nationalization of the process once built? I remember reading an article around 10 years ago stating the price the goverment was asking for the rights was to high. It seems now would be a good time to make another offer.

DoctorCandelario wrote:I haven't hear the podcast, but well, I live there. Its messy and its going to get worse, pretty soon.
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Re: How did Venezuela end up this way?

Post by Evan the Diplomat » Fri Feb 24, 2017 6:23 pm

I was assigned to the U.S. Embassy in Caracas for three years. We prepared classified reports on the political situation, economic situation, social programs, and even toilet paper shortages. You may look them up on WikiLeaks.

Even if the oil prices reached $200 a barrel, that would only give that would only give Venezuela a reprieve. When I was there from 2007 to 2010 Venezuela's oil production was already declining. Primarily because money was not being reinvested into production of oil. Then president Hugo Chavez, was using the national oil company, PDVSA, as a piggy bank to fund a bunch of national projects. Just as Pres. Trump is looking at generals to fill key positions, Chavez would go to PDVSA and pull successful managers out to run a refrigerator production line or a housing program. So you don't have your top talent in oil production overseeing oil production. They're not spending money on things as basic as drill bits, let alone new technology.

Then there was all manner of mismanagement and looting. Entire shipping containers of food were found to be rotting at the pier, and in some cases even being buried to cover it up.

The Bolivarian Government of Venezuela was also fond of price controls. Here is an example, Venezuelans eat a pork leg known as pernil during the Christmas holidays. Chavez set the price for pernil as X, the cost of production and sales to the retailer is X +15. Now any normal subsidy would tell the supermarkets: buy the product at X +15, sell it at X, provide us with your receipts and we will pay up the difference. But Chavez wanted to break the pork producers in Venezuela. So what did he do? He bought the pork legs at market rate from farmers in Brazil and then he flew all of those pork legs in refrigerated containers from Brazil to Venezuela to sell them at the discounted price of X in the poor barrios. The poor people were happy and thought Chavez was a hero. But the pork farmers didn't make as much money and ended up producing less pork the following year. As a result more pork from Brazil at market rate has to be important, also adding the cost of transportation.

Currency controls are also a favorite tool of the government. I'll give to quick examples. Tom what's my bag man in Venezuela. He owned a small chain of carwashes and industrial laundry. He needed to import the detergents chemicals and such from the United States. To do that he needed dollars. But because there was no free exchange of money he had to apply to the government to get that dollars at the official exchange rate. The government would limit the number of dollars, Especially if they did not like your political affiliation. In addition it was a long and slow bureaucracy. So instead of the official exchange rate of 3.5 to the dollar, Tom would sell me the local currency at eight to the dollar and I would give him a check drawn against my US bank. He would mail that check to his US account for deposit. Then he would use that money to purchase the chemicals he needed and ship them to his businesses.

A second example of currency control is that it is nearly impossible for opposition newspapers to purchase newsprint. The government controls the foreign exchange money, and is very stingy in giving it to any newspaper that does not toe the party line. So many opposition newspapers have gone from a daily addiction to a weekly petition and change from a broadsheet format to a smaller tabloid format. Now why the opposition newspapers have not gotten together in Venezuela and learn how to recycle newsprint is a whole other matter.

So those are just a few of the ways that Venezuela got that way.
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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Fri Apr 14, 2017 10:39 pm

Evan the Diplomat wrote:I was assigned to the U.S. Embassy in Caracas for three years. We prepared classified reports on the political situation, economic situation, social programs, and even toilet paper shortages. You may look them up on WikiLeaks.

Even if the oil prices reached $200 a barrel, that would only give that would only give Venezuela a reprieve. When I was there from 2007 to 2010 Venezuela's oil production was already declining. Primarily because money was not being reinvested into production of oil. Then president Hugo Chavez, was using the national oil company, PDVSA, as a piggy bank to fund a bunch of national projects. Just as Pres. Trump is looking at generals to fill key positions, Chavez would go to PDVSA and pull successful managers out to run a refrigerator production line or a housing program. So you don't have your top talent in oil production overseeing oil production. They're not spending money on things as basic as drill bits, let alone new technology.

Then there was all manner of mismanagement and looting. Entire shipping containers of food were found to be rotting at the pier, and in some cases even being buried to cover it up.

The Bolivarian Government of Venezuela was also fond of price controls. Here is an example, Venezuelans eat a pork leg known as pernil during the Christmas holidays. Chavez set the price for pernil as X, the cost of production and sales to the retailer is X +15. Now any normal subsidy would tell the supermarkets: buy the product at X +15, sell it at X, provide us with your receipts and we will pay up the difference. But Chavez wanted to break the pork producers in Venezuela. So what did he do? He bought the pork legs at market rate from farmers in Brazil and then he flew all of those pork legs in refrigerated containers from Brazil to Venezuela to sell them at the discounted price of X in the poor barrios. The poor people were happy and thought Chavez was a hero. But the pork farmers didn't make as much money and ended up producing less pork the following year. As a result more pork from Brazil at market rate has to be important, also adding the cost of transportation.

Currency controls are also a favorite tool of the government. I'll give to quick examples. Tom what's my bag man in Venezuela. He owned a small chain of carwashes and industrial laundry. He needed to import the detergents chemicals and such from the United States. To do that he needed dollars. But because there was no free exchange of money he had to apply to the government to get that dollars at the official exchange rate. The government would limit the number of dollars, Especially if they did not like your political affiliation. In addition it was a long and slow bureaucracy. So instead of the official exchange rate of 3.5 to the dollar, Tom would sell me the local currency at eight to the dollar and I would give him a check drawn against my US bank. He would mail that check to his US account for deposit. Then he would use that money to purchase the chemicals he needed and ship them to his businesses.

A second example of currency control is that it is nearly impossible for opposition newspapers to purchase newsprint. The government controls the foreign exchange money, and is very stingy in giving it to any newspaper that does not toe the party line. So many opposition newspapers have gone from a daily addiction to a weekly petition and change from a broadsheet format to a smaller tabloid format. Now why the opposition newspapers have not gotten together in Venezuela and learn how to recycle newsprint is a whole other matter.

So those are just a few of the ways that Venezuela got that way.
Nice way of summing it up. Economical situation today is grim. Cash currency crisis underway, full sail.

You can see whole families looking for food in garbage bags all around the city.

As of today we are living yet another period of unrest. Five people have been killed to date while in street demonstrations which are getting increasingly violent, people are mad and desperate. Food shortages are even showing their consequences even in the faces of soldiers and riot control police, which are tired, erratic, and don't have much will to fight...

I will keep reporting.

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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Wed Apr 19, 2017 1:09 am

Small update:

Big protests called for tomorrow on the streets, by opposition parties. Government has called up on whats called "Plan Zamora". What is this? Maybe jibber-jabber, but it grossly means army, militia, urban guerrilla ("popular inteligence") on heightened alert tomorrow.

I write this because there is a slight chance of violence tomorrow. By that I mean thugs harrasing people besides National Guard (active military branch who is in charge of internal security along with police, and do police duties. Dirty, corrupted, quite cruel) making arrests. A lot of fake or unreliable information is going to be circulating. Internet connection might be shut off too.

Civilian police has been momentarily subdued to the command of the National Guard. Whatever happens, even if nothing happens, I will try to keep you guys posted. I know some of you care.

0208 04/19

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Re: How did Venezuela end up this way?

Post by yossarian » Wed Apr 19, 2017 1:29 am

Stay safe.
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Re: How did Venezuela end up this way?

Post by Halfapint » Wed Apr 19, 2017 1:58 am

Been following this for a while. Keep us updated.
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Re: How did Venezuela end up this way?

Post by Sun Yeti » Wed Apr 19, 2017 9:20 am

Always good to hear a local perspective on the news I read, thanks for keeping us in the loop.

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Re: How did Venezuela end up this way?

Post by NamelessStain » Wed Apr 19, 2017 12:43 pm

Stay safe brother. Keep your head on a swivel and stay out of trouble.
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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Wed Apr 19, 2017 2:55 pm

Update here. 1536 local time.

2 dead so far, nationwide. Both by gunshot wounds. One 17 year old kid in Caracas (capital city) and a girl in Tachira state. Both kids were caught in crossfire. Unspecified number of Police wounded. One government supporter was severely hit in the head with a bottle, but there is no further official news. Mind you, television stations wont transmit anything because they have it forbidden, and social media is a mess.

Caracas is quite confusing right now. Lots of tear gas. A mere 10 minutes from my home things are ugly. A friend of mine is currently giving temporary shelters for some people.

In the western part of Caracas, armed urban guerrillas are running wild, intimidating people.

This pictures are from the San Martin sector of the city. A lot of Urban Guerrillas loyal to the government operate there. As you can see, they opnely carry weapons and bulletproof vest. Police and National Guard are ordered no to mess with them, and sometimes they operate together. Ther are formally called "Colectivos" or Social Collectives. They operate on UHF frequencies, open to hearing, they are easy to listen to if you got a radio.

Image

Image

This picture is from the Fajardo Highway in Caracas, looking East, near Chacaito/Bello Monte. Pretty strong clashes here.

Mind that the river below the Highway, the Guaire River, is RAW SEWAGE. People are crossing it to run or bypass national guard soldiers and vehicles.

Image

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Re: How did Venezuela end up this way?

Post by Close_enough » Wed Apr 19, 2017 7:19 pm

I'm reading CNN on it. Madura reminds me of Romania's Ceaușescu. Egregious mismanagement resulting in shortage of food, medicine, and basic staples like toilet paper and soap. Quashing of any political opposition, and rhetoric that would have embarrassed Bagdad Bob.

EDIT: In the bottom picture above, is the crowd trying to flee the area, attacking the roadblock, protesting, or some combination of them?

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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Wed Apr 19, 2017 7:53 pm

Close_enough wrote:I'm reading CNN on it. Madura reminds me of Romania's Ceaușescu. Egregious mismanagement resulting in shortage of food, medicine, and basic staples like toilet paper and soap. Quashing of any political opposition, and rhetoric that would have embarrassed Bagdad Bob.

EDIT: In the bottom picture above, is the crowd trying to flee the area, attacking the roadblock, protesting, or some combination of them?
People were protesting and trying to push through. National Guard fired first and moved in vehicles, so people fought back. Volume of tear gas fired was so big that people on the bottom right were trying to flee, since they were trapped in the mayhem. Two people fell off the top level of the highway, got some fractures.

yes, Maduro is a fool, but a dangerous one.

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Re: How did Venezuela end up this way?

Post by MPMalloy » Wed Apr 19, 2017 8:11 pm

From ABC (Australia) http://www.abc.net.au/news/2017-04-20/v ... c=Newsmail

Hundreds of thousands of people are in the street. I have a feeling that this will end in an explosion of fire. Venezuela will burn. I hope not, but this is very bad.

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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Wed Apr 19, 2017 8:26 pm

MPMalloy wrote:From ABC (Australia) http://www.abc.net.au/news/2017-04-20/v ... c=Newsmail

Hundreds of thousands of people are in the street. I have a feeling that this will end in an explosion of fire. Venezuela will burn. I hope not, but this is very bad.
Oposition leadership has already called for protest tomorrow, same spots, same hour. As I am writing this there are still fights all around the city. Tomorrow might be worse

In 2014 we thought that everything was going down. Two months and 23 dead later, everything just moved along. Lets see this time

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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Wed Apr 19, 2017 9:41 pm

At this time, 2247 04/19

National Guard officer shot dead near San Antonio town, which is near Caracas. Another officer (Colonel) shot in the leg in same incident. They went in an urbanization in crowd control duties and somebody took well aimed shots at them. 3 dead, nationwide. people have been throwing lots of molotov cocktails at armored vehicles. People seem to be more enraged.

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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Thu Apr 20, 2017 9:20 pm

At this time, 2227 04/20

Caracas, El Paraiso neighboor.

National Guard and unidentified personel in firefight. As you can hear, this are not riot control rounds.

https://twitter.com/jogonzalezc/status/ ... 6915760129

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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Thu Apr 20, 2017 9:35 pm

Long night here in Caracas. I have no way of uploading voicenotes here, but El Paraiso neighborhood and El Valle neighborhood in Caracas are being lit up with rifle fire. Looting is taking place in El Valle neighborhood, National Guard units moved in, and firing erupted. Mind that El Valle has a lot of slums on the hillsides up from the residental areas, and people went down from said slums. I only hope that you can believe me that there is full auto rifle fire and you can here bullets whistling.

Nobody knows for sure whats happening, but gunfire can be seen and heard

This is turning really scary guys

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Re: How did Venezuela end up this way?

Post by MPMalloy » Thu Apr 20, 2017 9:37 pm

Doc C: Keep your head down & get out if you can. Good luck & GOD bless!

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Re: How did Venezuela end up this way?

Post by DoctorCandelario » Thu Apr 20, 2017 9:48 pm

MPMalloy wrote:Doc C: Keep your head down & get out if you can. Good luck & GOD bless!
Luckily I live at a safe distance from El Valle, but the street is so quiet that If I go outside, I can hear the gunshots from far away. However, what this people are living is looking ugly. No further confirmed info about anything.

Thanks, lets see what the dawn brings us tomorrow.

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Re: How did Venezuela end up this way?

Post by TacAir » Fri Apr 21, 2017 9:52 am

The protest made the US new. All 30 seconds of it.

Arming neighborhood thugs sounds like a bad idea - at some point, even they will get hungry. WHen the thugs go up against the Nat Guard (another set of thugs) all hell will break loose.

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