Author Topic: Venezuela: Monetary reform from June 4th 2018  (Read 900 times)

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Offline Jostein

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Venezuela: Monetary reform from June 4th 2018
« on: March 25, 2018, 01:47:24 AM »
Nicolás Maduro has announced that the Central Bank of Venezuela will issue a new currency from the next June 4th. The new monetary unit will be called "Bolívar Soberano" and it will have a value of 1000 bolívares fuertes, so:

1,000 VEF = 1 VES

Will be issued just two coins of 1 bolívar and 50 céntimos, around 1 and 1/2 euro cent respectively ::). And banknotes of 2, 5, 10, 20, 50, 100, 200, 500 bolívares, no word "soberanos" appearing in any bill or coin.


http://sumarium.com/gobierno-abre-paso-a-un-bolivar-soberano-en-busca-de-mayor-poder-adquisitivo/

Poor Venezuela  :'(
"Change is the law of life. And those who look only to the past or present are certain to miss the future" - John F. Kennedy

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Offline Pabitra

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #1 on: March 25, 2018, 04:53:39 AM »
Bimetallic for face value of 1 Euro cent?
Either cost of manufacturing has really come down in Venezuela or all these European mints were making a fool of us for minting those plated steel coins at such high prices. ;D

Offline Jostein

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #2 on: May 30, 2018, 03:56:12 PM »
5 days before the currency reform, Nicolas Maduro has postponed the introduction of the currency by two months "at least"... ::)

https://www.elintransigente.com/mundo/2018/5/30/maduro-posterga-el-freno-al-cambio-de-la-moneda-venezolana-493444.html

I think that this reform have not sense, they should wait until the hyperinflation stop and then take off, not three, but four, five or six zeroes. Let see.

Poor Venezuelan people  :(
"Change is the law of life. And those who look only to the past or present are certain to miss the future" - John F. Kennedy

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Offline Jostein

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #3 on: July 10, 2018, 09:11:30 AM »
I doubt that the new series of coins and banknotes enters in circulation finally. The hiperinflacion in Venezuela reach the 200.00%, right now, 1 USD is about 3,500,000 bolívares fuertes (3,500 bolívares soberanos), taking in mind that the bigger banknote, 500 bolívares soberanos has today (one month after the introduction of the new currency) about 15 cents, maybe in August it would be even less.

I'm sorry for my Venezuelan brothers, they are living a tragedy...
"Change is the law of life. And those who look only to the past or present are certain to miss the future" - John F. Kennedy

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Offline Figleaf

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #4 on: July 10, 2018, 12:51:26 PM »
I'm sorry for my Venezuelan brothers, they are living a tragedy...

You are quite right, Jostein. Hyperinflation is a tragedy, all the more because it is a disease that is fully understood and the cure is known. The cause is also known. Severe economic mismanagement. The current and previous presidents spent far more than what they could afford and maintained a ruinous system of government determined prices. This was at a time that populism was still called nationalism. The tragedy is that the people of Venezuela believed their lies, now called fake news and elected such harmful leaders, but also that this scenario keeps on happening. When will we ever learn?

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Offline Jostein

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #5 on: July 10, 2018, 01:21:00 PM »
You are quite right, Jostein. Hyperinflation is a tragedy, all the more because it is a disease that is fully understood and the cure is known. The cause is also known. Severe economic mismanagement. The current and previous presidents spent far more than what they could afford and maintained a ruinous system of government determined prices. This was at a time that populism was still called nationalism. The tragedy is that the people of Venezuela believed their lies, now called fake news and elected such harmful leaders, but also that this scenario keeps on happening. When will we ever learn?

Peter

Im completely agree with you Peter...When will we ever learn? I think that we will never do it. The history is a cycle, and the populism or nationalism allways take advance in bad moments (corruption, immigration, crisis...), the people belive the lies of politicians that call for "The State will provide you of free houses, public transportation, oil, money, food for you all" (left populism) or "We want our own, stronger and better countries, cause we are better than you" (right populism/nationalism).

Hope for a great future for Venezuela, it will arrive before than we expected.

By another hand, I think that is time to rethink the monetary reform and use the rate 1/10,000 or 100,000 instead 1/1,000. Lets see...

Fran
"Change is the law of life. And those who look only to the past or present are certain to miss the future" - John F. Kennedy

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Offline Jostein

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #6 on: July 22, 2018, 02:44:13 PM »
One more time, the reform has been postponed “sine die”. The government is talking to remove between 4 and 6 zeroes instead the 3 ones originaly planned...

http://runrun.es/nacional/355478/bloomberg-venezuela-retrasaria-planes-para-introducir-nueva-moneda.html

Lets see, poor Venezuela.
"Change is the law of life. And those who look only to the past or present are certain to miss the future" - John F. Kennedy

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Offline Pabitra

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #7 on: July 22, 2018, 06:29:31 PM »
My friend from Venezuela sent me this current affairs photo  :o

Offline Stef

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #8 on: July 26, 2018, 10:38:41 AM »
5 zeros from August 20 is the next plan. Bolívar Soberano will be tied to the cryptocurrency Petro, whatever that means.

Offline Jostein

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #9 on: July 26, 2018, 10:58:56 AM »
So, 100,000 VEF = 1 VES.


If the Dollar today is among 3,200,000 VEF thats mean that 1 USD = 32 VES. So:
0,50 VES = 0.01 USD
1 VES = 0.03 USD
2 VES = 0.06 USD
5 VES = 0.12 USD
10 VES = 0.32 USD
20 VES = 0.64 USD
50 VES = 1.28 USD
100 VES = 3.20 USD
200 VES = 6.25 USD
500 VES = 15.60 USD

Also, Maduro said that the Central Bank of Venezuela will issue coins of 25, 12&1/2, and 10 céntimos shortly... ???

Instead of it, I think that they will need a new Monetary Reform from next year... ::)


« Last Edit: July 26, 2018, 11:11:46 AM by Jostein »
"Change is the law of life. And those who look only to the past or present are certain to miss the future" - John F. Kennedy

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Offline Jostein

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #10 on: August 17, 2018, 09:08:53 AM »
Three days after the introduction of the new currency, the dollar reach 5 million bolivares (BsS 50)

- Thre price of a 12 egg carton is BsF 5,16 million (BsS 51.60)
- The price of a liter of water is BsF 800,000 (BsS 8)
- The price of a liter of gasoline is BsF 9 (BsS 0,00009) This will be impossible to pay with the new system, then, is expected an increase in the price of the oil. The minimum amount possible will be BsS 0,01 in the form of the current BsF 1,000 note wich will remain in circulation.

The minimum salary is BsF 6 million (BsS 60). This is the surreal situation suffered by the Venezuelan people.


 ::)
"Change is the law of life. And those who look only to the past or present are certain to miss the future" - John F. Kennedy

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Offline Figleaf

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #11 on: August 17, 2018, 11:29:27 AM »
Humans are inventive, Jostein. I once interviewed Brazilians on how to survive in times of hyperinflation. It's easy for the wealthy: sell the local currency and buy e.g. USD. New receipts are more difficult, but the solution is in crazy interest rates. Start a bank or a dunning company, force payments due.

The poor are on the other side of the equation. They do well by not (re)paying whatever they owe. Every month the payment is late, they gain a neat sum in interest. Example. If the interest rate is 10% a month, borrow 100, promise to repay 110 a month later, dither a month on repayment, then pay the 110, but get 120 yourself in two months interest. Of course, this leads to armed conflicts and private justice, further undermining democracy. This is also what happened in Russia during the hyperinflation period after 1991.

The Brazilians came up with a more innocent game also. One retailer with access to USD offered free televisions: they had to be paid, but the retailer reimbursed the price paid, in local currency, of course, six months later. The fall of the local currency against the dollar gave him a margin above his usual margin on television sales in local currency and the idea gave him a fantastic commercial boost.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Offline Pabitra

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #12 on: August 19, 2018, 12:09:43 PM »

Offline chrisild

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Re: Venezuela: Monetary reform from June 4th 2018
« Reply #13 on: August 19, 2018, 01:47:14 PM »
Clicking that link takes me to this:

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We recognize you are attempting to access this website from a country belonging to the European Economic Area (EEA) including the EU which enforces the General Data Protection Regulation (GDPR) and therefore access cannot be granted at this time. For any issues, contact webmaster@bakersfield.com or call (661) 395-7500.


Had no idea that so many in California are so parochial. ;D  Even the Los Angeles Times, contrary to leading East Coast papers, locks us out. Oh well.

Christian

Offline andyg

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always willing to trade modern UK coins for modern coins from elsewhere....