There have been progressively developing reports that with the Crude Oil spot market returning to sanity (and perhaps even below expected values), that all the commitments of H. Chavez' government and extra-territorial ambitions are placing a back-breaking burden on the Venezuelan economy.
It does look like he is trying even harder now to get his hands on any endeavor that has potential cash value. The latest move is the nationalization of the largest working gold mine in the country.
Given the 500% rise in cocaine transshipment through Venezuela in the last five years, perhaps it could be considered a bright spot that this latest nationalization may at least have the trappings of legality...
but also given the uses that the Chavez regime put money to, perhaps it would be better for everyone if he did run out of money and shortly thereafter friends.
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8 comments:
comment from Karen2, delivered by carrier pigeon:
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LDG - was going to post on your site, but don’t know our password! Always happens when husband sets up accounts! Here’s what i wrote…..
Great article. Less friends is perfect! Read the other day the the USA is Chavez’s only oil customer how pays him in cash. The remainder of his ‘clients’ pay 5% with the remainder payable over 30 years! He needs oil to be at or above $100 pb to stay ‘in the money’! Since the USA receives a fair amount of oil from Chavez, it is a good idea to conserve, even though prices are down.
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Thank you, Karen2, and sorry for the commenting troubles.
I recall that some of Chavez's favorites, like Cuba, when the contracts were written, were given a 3% rate over 30 years and a 5 year grace period.
Things are indeed tightening and all the money wasted on military purchases have put the country in dire straits. Energy blackouts are not flukes, but rather a lack of maintenance over the past 10 years. The same can be said of all infrastructure. PDVSA is not working anywhere near capacity, but all this is kept quiet. Fires are frequent at PDVSA facilities. With the price of oil dropping Chávez will not be able to honor all of his so-called promises. He is known as "the checkbook that wanders the Earth." Tried to buy everyone and everything. All this is common knowledge, what most people don't know and few care is that he will squeeze his own people to get money. Let's see if there is anyone who will be able to stand up to him. I doubt it, as according to reports, with local elections only 2 weeks away, ALL politicians (including the so-called opposition) are playing dirty politics as usual, with a lot of infighting. Isn't it strange how even in a country that is in dire straits, politicians will still fight tooth and nail to get their turn to scrape the barrel.
I have nothing pertinent to add. I'm only compelled to comment because the word verification sequence that randomly showed up when I looked at the comments was... "shady".
That, by itself, is a nice comment on Mr. Chavez.
"shady".
Kudos.. I'd add the word "shaky" :)
Perhaps the owners of the mine should take a page out of Atlas Shrugged and collapse the tunnel so it can't be looted.
Commendable reference and motivation there. Only one rub with that, Tom:
It is an open pit mine.
Having seen a couple "nationalizations" take place elsewhere, if they are done by decree (forcible) rather than by negotiation (buy-up,the management is usually the last to know it is going down... about the time the local armed forces arrive.
(and Welcome, Tom! Thanks for your interest.)
Off-Topic, but Venezuela related:
U.S. expels Venezuelan Consulate staff from Houston TX after violation of diplomatic protocols.
The Russian version (English-langage media) of the "Igor the Salesman" visit(s):
Raft of Agreements.
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