flarty said:
Res Plus said:
flarty said:
Inflation is high but is is offset somewhat by there economic growth. Venezuela had the best performing stock market last year...
Goodness me, the Venezuelan stock market is barely existent...
"Capital flight from Venezuela intensified as Mr. Chávez pursued more interventionist policies, including capital controls and a fixed official exchange rate that ? if you can get it ? offers dollars at a quarter of the exchange rate that the greenback fetches in the black market. Stock market capitalization of companies listed on the Caracas Stock Exchange has gone from a paltry 7.6% of GDP in 1999 to a minuscule 1.6%.
Rather than pursue policies that might stimulate investment, the government?s response to shrinking productive capacity and high inflation has been price caps. The result? Shortages of food and other basic necessities, periodic electric brown- and blackouts, and far fewer jobs: the labor force participation rate has dropped from 52% to 46% in the Chávez era"
Agree the in-roads into the desperate poverty in Venezuela was initally impressive though! Shame he did it by waging class war on the middle class ("the squalid ones", I believe he called them) and that his use of oil money is so unsustainable.
Saw today there is currently a row over whether the stand in President gets to stay, very close election 50% to 50% nearly, be interesting to see where it goes from here!
There stock market grew by over 200% last year (it may have contracted somewhat since, but i would of expected more growth since Chavez's death), and inflation is 10% (roughly?) lower than it was 1999. As we all agree Chavez has some incredibly anti capitalist policies, making their stock market one of the most unattractive in the world. So showing a growth of over 200% in a single year is nothing short of incredible.
As for the middle class it is unfortunate that they seem to be hardest hit in Venezuela. I don't understand whats happening with the food shortages, The Cuban government has a spectacular food program where citizens get roughly $50 worth of groceries for a little over a $1, I'm not sure how they can afford to subsidize that sort of cost and Venezuela cant.
But as i said there was many short comings of the Chavez government, possibly due to bad management. Its a good comparison to use against Margaret Thatcher as they were polar opposites with some problems that are all not dissimilar (black outs etc). Which has just made me think. In any ropey economic climate it seems the middle class are first to be squeezed. Our current government cut all state benefits to the middle class in the first Budget here in the UK. Now they are cutting benefits to the poor and disabled, whilst awarding a tax cut to the wealthy. Chavez might have squeezed the middle class in his country but at least it was with the intent to help the more vulnerable.
Popped in off the back of the other thread - thought I'd replied!
Inflation today is 25%, in 1998 it was... 25%, not 10% lower: http://www.tradingeconomics.com/venezuela/inflation-cpi I do believe they managed to get it down to 17% at one point, which no doubt you'll claim as a roaring success?
I thought you might go for the 200% (now 300%) increase. Only an extreme Socialist could claim tripling a tiny amount as as a wild success because only Socialism can depress growth to such an extent. First, you have to remember the 2012 rally was driven by 2 things - a wildly unsustainable 41% increase in public spending (on top of its already ruinous levels) to buy Chavez a second term and the belief that Chavez would step down due to his need for cancer treatment (i.e. someone sane might come in). The public spending supported bond purchases with people creaming huge profits and basically ignoring his State theft policies and taking a chance for the cash. At a fundamental level, the growth of the stockmarket is being driven not by external investment but by growth in GDP through massive local investment. That is how you end up with a bizarre situation where the market capitalization (i.e. the public perception of the value of the stock) dwindles while the overall value of the market increases. It is also worth noting the paltry 5% increase in the FTSE over the same period was worth far more than the 300% growth in Venezula. The food programme in Cuba is based on investment in a proper, modern farming sector - if Chavez had done that, fine, great - but he didn't, he waged war on "the squalid ones".
Yes, obviously, completely destroying an entire class' standard of living and demonising them to boot to finance your continued control of power, while hapazardly squandering its wealth is fine if you claim to be doing it for the "vulnerable" (a meaningless word if ever there was one). I certainly don't think you can call driving the oppostion into hiding, closing radio stations and locking up judges as being "possibly due to bad management" - call a spade, a spade - the man was dicatorial and oppressive, he was waging class war.
The comparsion to Thatcher is erroneous, the blackouts during the 70s were due to the miliant attempt to bully the nation by the thankfully defunct, corrupt Union power barons who thought they could blackmail the nation into allowing them to work 3 days a week. The blackouts here have been caused by the theft of foreign owned assest without retaining the expertise required to run them.
Really you are defending the indefensible. The only difference between Venezula and the total catastrophe of every other Socialist state is time and oil. If that had been harnessed and properly invested then they could have controlled, sensible growth and have moved to a balanced, happier economy, instead a single man has completely destroyed that chance in the pursuit of power and his ego (loved the 4 hour TV show he awarded himself), he has admitedly produced (a sub-standard, unsustainble) health system at the cost completely divided a nation (not looking good the 50.8% "win" and refusal to recount).