Wednesday, December 10, 2014

The Phantom of Miraflores

There is no doubt about it, not only Maduro is in denial but he has a plan. That the plan is written by Cubans willing to gamble on outright repression is inconsequential. That the plan has any chance of success is beyond the point. That chavismo itself will not support it is the least of his worries.

Floating, falling, sweet intoxication

Right now all indicators are in free fall.

The black market has reached 178 yesterday and there is no sign whatsoever that the slide will stop. Certainly not as long as the regime clings to a fictitious 6.3 that only people well connected may access (I suppose like those in the van caught yesterday in Puerto Cabello with around 10 million USD in cold cash).

From the oil front news are getting worse. The Brent has reached a 5 years low and some predict an oil barrel at 43USD!!!!!

And even though the regime hides the best it can its statistics the advanced numbers by serious observers predict now a 3 digit inflation for next year, and Barclay's says that GDP will contract 4.4% this year and 6.2% next year.

In this darkness that you know you cannot fight

There are more concrete indicators that suggest things are going downhill fast.

Coffin production has decreased because there is no stuff to build them coffins. What? Let's hope that there is enough fuel oil for incineration.

Telecom services will go up next year. "because we do not want G4 network to be only for the elites". Stuff like that cannot be made up... I would, personally, settle for a G3 working, for at least one in two mobile calls going through.

Our main food producer, Polar, keeps being under constant attack. It was accused of not producing all the corn flour needed, by no one else but the chavista head of the Polar Union. Unfortunately he did not bother to check that Polar was processing all the corn it could get and it certainly was not its fault that there was no more corn available. That has not stopped organizations like "Juventud Obrera de la Central Bolivariana de Trabajadores" (Young Unskilled Labor of Bolivarian Workers Central Union?) led by a certain Gerdul Guttierez (Gerdul?) to demand more inspections even though at the same time they acknoweldge that they have nothing on Polar...

Turn your face away from the garish light of day
Turn your thoughts away from cold unfeeling light

So what is Maduro doing from Miraflores Palace? Nothing. Well, nothing besides insulting people right and left and looking for scapegoats. Any scapegoat will suffice at this point.

Let's start with the usual conspiracy theory. Now the new variation is that Fitch et al. are conspiring to downgrade Venezuela ratings so no one will lend to Venezuela outside of exorbitant interest rates. As Damian Pratt writes well, reality check are not words in Maduro's dictionary. Never mind that actually some oil companies DO lend to oil projects. Or is Maduro the only person in the regime unaware of the currently existing debt burden? That no rainy day fund was ever set aside?

Insults also come and go.  Chritine Lagarde, chair of IMF was accused of having a spaghetti brain. Of course Lagarde is laughing it all as Maduro has finally recognized that Venezuela needs "financing". She knows the last word is hers.

Purge your thoughts of the life you knew before
Open up your mind, let your fantasies unwind

And the offensive does also betray great nervousness in the higher up echelons of the regime. The US Senate, now that Mary Landrieu has been booted out, mercifully, has finally voted a bipartisan legislation to emit sanctions against Venezuelan authorities that are involved in the repression earlier this year. NOTE: these are no sanctions against Venezuela, just against possible assets of a couple hundred chavista that happily jailed folks this year, tortured them, etc... We are just waiting for the House to pass its version and it seems that Obama will sign it. Of course he will sign it, if anything because the Venezuelan dog has only bark left to it. If that.

Maduro was prompt to react. Apparently the US is desperate... And if they dare, there will be an unanimous response from Latin America to defend Venezuela... Then again, the upper echelons of the corrupt regime will be hit where it matters more: their wallet and ability to go shopping in the US.

Close your eyes and surrender to your darkest dreams

The regime is putting, deliberately?, itself in a corner. I wonder if it is not the script from Cuba, dressed through the narco criminals that dot the Venezuelan army. "We are going to jail if we lose power. Henceforth let's declare bankruptcy, stop paying shit, and shoot down anyone that dares to oppose us". Do they have a choice? After all, Cuba has postponed its negotiations with the European Union where it was assumed that economic help for the transition would in exchange of better Human Rights records, even if the notion of single party would not be challenged.

Draw your conclusions.


  1. That's add Arreaza's comment about the need to control brain drain...

  2. Boludo Tejano3:10 PM

    Certainly not as long as the regime clings to a fictitious 6.3 that only people well connected may access (I suppose like those in the van caught yesterday in Puerto Cabello with around 10 million USD in cold cash).

    My reading of the article found "at least THREE million dollars," not ten.

    But that is a minor blip in an interesting article.

    1. Anonymous3:30 PM

      The missing $7 million was quickly distributed to the arresting officers and the military that protected them. Feliz Navidad.

  3. Anonymous4:57 PM

    You got it all wrong Daniel, you forget Izarra's plan to build 40,000 hotel rooms next year that will increase tourism revenue by 15%. See! They do have a plan!

  4. Charly6:11 PM

    I do not see the connection between the 6.3 exchange rate and the parallel. To me, the parallel rate is a response to the fact that there are no dollars available officially at whatever rate, whether 6.3, 12 or 50. There again the invisible hand of the market at work, Whoops, I forgot, the parallel market does not exist in Venezuela, so said His Nibs

  5. Are there enough dollars in banks and in company assets that the Venezuelan government might just nationalize everything like Cuba did in '66-'68?

    1. All the smart people have taken away long ago as many dollars as they could. Expropriating what is left in business and assets will leave very little potential currency. Who will come and pay for an expropriated Polar?


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