Archive for September, 2007

Revisiting the swap rate

September 23, 2007


In early August I showed the graph above predicting the swap exchange rate or parallel rate would have to move up to catch up with the ¨ïmplicit¨rate. Well, it happened much faster than I thought even though increased reserves drove the implicit rate down a little bit.

Using Central Bank data, I did a study of what is the average seasonal increase in M2 from October to December and found 22% in the last 4 years. This means that the implicit rate will jump near Bs. 5600 per dollar in reserves. Add the Constitutional reform and the fears of what the Government intends to do with the ¨Bolivar Fuerte¨and Bs. 6,000 by the end of the year is quite likely.

¡Ahora si pertenezco! por Oligarco Burguesito

September 23, 2007

 (English version here)


¡Ahora si pertenezco!
por Oligarco Burguesito

Confieso
que soy un oligarca. Mientras estoy aquí escribiendo en la computadora
miro a través de la ventana y veo otro atraco frente a mi edificio.
Pero no me importa mucho. Ya soy feliz. Me uní a la revolución. Me he
convertido en un Socialista del Siglo XXI. Me he unido a la economía
informal. ¿Quien hubiera pensado que yo me convertiría? Todavía detesto
 a Chávez y su militarismo. Su deseos de adquirir poder en nombre del
pueblo. El hecho de que si viene de su derecha, el lo llama un golpe,
pero si viene de su izquierda lo considera una nueva era para la
democracia. El hecho de que a pesar de docenas de intentos fantasmas
contra su vida, el esta aún vivo. El hecho de que hace trampa en las
elecciones. El abuso del poder que detenta. Su desprecio a los derechos
humanos. Lo detesto, pero he aprendido a amar la robolución como miles
de miles de venezolanos. No uso franela roja, pero mentalmente soy ya
parte de eso. He aprendido a amar la revolución, sus aspectos
positivos. La revolución me trata ahora muy bien de verdad.

Pero
me Adelanto en mi historia. Déjenme empezar por el principio.Todo
empezó en Febrero cuando estaba sentado aquí mismo viendo otro atraco a
través de mi ventana. Se acercaban las vacaciones de Carnaval y estaba
pensando irme a la Isla de Margarita. Llame a mi pana José, al agente
de viajes, preguntándole sobre un lugar barato en Margarita, pasaje,
alquiler de carro. Cuanto costaría todo  porcuatro días?-Le pregunte a
José.

¿Estas loco Oli? ¿Margarita? ¿Para que carrizo querrías ir
a  una porquería de hotel allá, cuando puedes volar a  Aruba, quedarte
en un hotel lujoso donde tienes buen servicio, agua, electricidad y
menos gente y todo a un precio mas barato? Y además, de regreso puedes
traer unos kilitos de azúcar-dijo José.

Oyendo todo esto pensé
que José se había fumado una lumpia, como dijo Aristóbulo de Chávez,
antes de que lo nombrara Ministro de Educación. De que me estara hablando

Es
fácil Oli, me dijo José. El pasaje en avión es mas caro, pero lo pagas
a la tasa de cambio oficial. Pero además, vas a Aruba y le pides a
CADIVI tu cupo de dólares de viajero, te tocan $5,400 a la tasa
oficial. Con eso te puedes quedar en un hotel mucho mejor que los que
hay en Margarita por el mismo precio, comer comida de mejorcalidad pero
mas barata y la plata que no te gastes, puedes ir al casino, compras
las fichas, apuestas un par de veces al rojo en la ruleta, cambias tus
fichas por efectivo y recibiste tu cupo de CADIVI a la tasa oficial.
Vendes esos dólares en el mercado de permutes y el viaje te sale
prácticamente gratis.

¡Caray! le dije a José, Yo no tenia ni la
menor idea de todo esto. ¿Y que hay que hacer, donde empiezo? Bueno-
dijo José-simplemente ven a mi oficina mañana con tu pasaporte,
regístrate en la pagina de CADIVI y así iniciamos todo el proceso.
Pasaporte? No tengo pasaporte, que tan rápido puedo sacar uno? – le
pregunte a José

Bueno, es bastante difícil y complicado, pero
dame 200,000 bolos y yo tengo un pana que te lo saca en una semana. A
menos que tu hayas firmado en el revocatorio contra Chávez. ¿Tu
Firmaste?

Claro que si José, tu sabes que me desagrada Chávez, le conteste.

Bueno
Oli, en ese caso, me tienes que dar bs. 500,000, los casos de la lista
Tascon son mas difíciles de resolver, por lo tanto sala algo mas caro.

En
aquel momento pensé: ¡Gracias a Dios que existe el libre Mercado!-
acuérdense que yo todavía era un oligarca. Pero claramente el libre
Mercado en la robolucion había salvado mis vacaciones. En menos de una
semana tenia mi pasaporte, mis $400 en efectivo de CADIVI y mi pasaje
de ida y vuelta y me fui a Aruba. Mi transformación hacia un hombre
socialista del Siglo XXI había comenzado.

Aruba fue
espectacular, conocí a una gringa, rumbeamos durante cuatro días y al
final me gaste como $1,800. Regrese a Caracas, vendí el resto, unos
$4,100 a Bs. 4,200, y con esos 17 millones de Bolivares pagué los 3.9
millones del viaje, los 8.8 millones de los demás dólares y me
embolsille 4.5 millones de Bolívares de “ganancia” por mis vacaciones.

Ese
monto es tanto como lo que yo gano en un mes trabajando duro en mi
empleo en una empresa de acero en Caracas, donde tengo que llegar
temprano, trabajar duro, quedarme hasta tarde y preocuparme por las
cosas. Ahí fue donde me di cuenta que tenia que haber algo errado en el
sistema capitalista y después de todo, quizás Chávez tenia razón con su
Socialismo el siglo XXI.

Al día siguiente me levante temprano y
aunque normalmente no leo el periódico, vi los titulares sobre el Bono
del Sur, que iba a salir  la semana que viene. Me pregunte para que
servia eso y como no se nada de finanzas, llame a mi otro amigo,
Miguel, que tiene un blog y a veces escribe sobre esos temas, pensando
que a lo mejor el me lo podría explicar bien.

Es muy fácil-dijo Miguel: El Gobierno te vende un bono que tiene distintas partes tanto en Bs. como en $. Pagas por la parte en
dólares
a la tasa de cambio oficial, te volteas, vendes las partes, recibes
unos Bolívares y vendes los dólares en el mercado de permuta. Por cada
dólar que te dan, te ganas como Bs. 800. Incluso, algunas casas de
Bolsa te prestan, para que te puedas financiar parte de la orden y
puedes obtener mas Bolívares de los que podrías con los que tu tienes.
Le dije a Miguel que esto no tenia ningún sentido y el empezó un largo
discurso sobre liquidez, absorción y términos como ese, que apenas
entendí. Pero Miguel parece saber de lo que está hablando y fui a la
casa de bolsa frente a donde trabajo, puse una orden por $20,000 y pedí
prestado la mitad de lo que me asignaran.

Me asignaron $8,000,
la mitad en $, los vendí y en un santiamén le había agregado unos 3.2
millones de Bs. mas al pote de Aruba, y en un instante.

Llame a
Miguel para darle las gracias por sus consejos y cuando ya iba a
colgar, me dijo: “Bueno, me imagino que ya tu pediste también tu
dólares de CADIVI de Internet? ¿Ah? Le dije, no, no los he pedido. ¿Y
cuanto es eso? Bueno, Miguel me dijo, te dan $3,000 a la tasa de cambio
oficial.

En menos de dos días, había usado mi cupo para comprar
una Macintosh, una impresora, un iPod de 80Gb y un sistema de cornetas
Bose para el iPod. Averigüe para comprarme un iPhone, pero supe que no
funcionaria aquí, por lo que use mis últimos $500 de mi cupo de
Internet para comprar un disco duro externo, un sistema WiFi y una
cámara digital.¡Caray! Era finales de Marzo y mi nivel de vida había
mejorado significativamente y mis dudas sobre la robolucion afloraron con
intensidad. ¿Me habría equivocado con Chávez? Esto era de verdad una
vida diferente. Sin necesidad de competir, sin trabajar duro y con
recompensas espectaculares. ¿Que mas podía pedir un oligarca como yo? O
seria que me estaba convirtiendo en un socialista? Gran parte de mi
pote había sido gastado ya, pero mi casa ya era parte de la era
espacial.

Poco después que todo los aparaticos Apple llegaran,
el Gobierno anuncio el bono de PDVSA. Hay que llamar a Miguel de nuevo.
Me dice que es un robo la cosa. Me meto de lleno, pido $100,000 y mi
banco me lo financia, siempre y cuando mantenga el préstamo por un mes
mínimo. Pensar en eso me hace temblar de miedo, pero me meto de todas
maneras, financiado 90% por mi banco. Increíblemente me asignan $45,000
a un precio promedio de Bs. 2,900 pero tengo que esperar un mes para
venderlos y ganarme la no despreciable suma de Bs. 600 por cada dólar.
Pero soy tan sortario que después del mes, el paralelo ha
subido a
 Bs. 4,000. Me gano Bs. 1,100 por dólar asignado y ahora tengo nada mas
y nada menos que Bs.  49 millones en mi bolsillo. Eso es mas de lo que
yo gano en una año en mi trabajo!

Es en se instante que me doy
cuenta lo poco que he entendido la revolución hasta ahora. Por supuesto
que es atractiva. Todo te sale
gratis y no tienes que trabajar.
Podría ganar aun mas si trabajara duro, desarrollaría contactos en el
Gobierno para obtenercontratos.
¿Pero para que? En un mes he ganado mas que en una año matándome en mi trabajo.

Renuncio
entonces a mi trabajo y me uno a la economía informal. Me levanto tarde
todos los días. ¿Que es lo que hago? Muy facil. Todos los días salgo a
buscar a alguien que no tenga para comprar su cupo de $ de compras por
Internet que les da el Gobierno. Les consigo una tarjeta de debito y a
través de un amigo en Miami les “gasto” todo su cupo. Cada cupo me
cuesta 6.45 millones de Bolívares, vendo los dólares en el mercado de
permuta a Bs. 4,900. La diferencia es Bs. 8.25 millones, les pago  a
los clientes Bs. 1.5 millones y me gano yo por el servicio 6.75
millones de Bs. por cliente. Por eso, solo trabajo un cliente al día,
me he unido al Socialismo del siglo XXI. Esfuerzo mínimo con retorno
máximo. Veinte clientes al mes me netean tres veces mas que lo que me
ganaba en una año en mi Viejo empleo; No hay beneficios, ni seguro
medico, pero caramba, no hago casi anda y gano muchísimo mas. Tengo
mucho tiempo para rumbear. Prácticamente vivo em el Tinajero de Los
Helechos después de las cuatro de la tarde, donde mis compañeros
socialistas me invitan a tomar Güisqui de
18 anos.

Todavía no
uso la franela roja. Pero un amigo me dijo que podía ir a una reunión
del PSUV con una y podría conseguir unas veinte personas y convertirlas
en clientes.¡Imagínense! ¡Podría trabajar un solo día al mes si hago
eso!

Ahora si pertenezco. He visto la luz. Amo la robolucion. Me
trata bien aunque no este totalmente de acuerdo con ella. Apenas
trabajo ahora. Espero con ansiedad el año 2008 para poder ir a Cancún
con mi cupo de viajero, He saltado al Socialismo del Sigo XX1.

Y
a lo mejor hasta me cambio el nombre. Los Chavistas tienen problema con
el, aunque les digo que porque simplemente no me llaman Oli

¡Ahora si pertenezco!

I belong now by Oligarco Burguesito

September 22, 2007

(In Spanish here)

I belong now by Oligarco Burguesito

I confess I am an oligarch. As I sit here typing, I look through the window and see another mugging right outside my building. But I don’t care. I am happy now. I have now joined the robolution. I have become a XXIst. Century Socialist. I have joined the informal economy. Who would have thought that I would be converted? I still detest Chavez and his militarism. His grab for power in the name of the “people”. The fact that if it comes from his right, it’s called a coup, but if it comes from his left it’s called a new dawn for democracy. The fact that despite the dozens of phantom attempts on his life, he is still alive. His cheating in elections. His abuse of power. His disregard for human rights. I still despise him, but I have learned to love the revolution like thousands of Venezuelans. I am indeed a XXIst. Century Socialist. I don’t wear a red shirt, but mentally I belong now. I have learned to love the robolution, it’s positive aspects. It does indeed treat me well now.

But I am getting ahead of myself. Let me start at the beginning. It all began last February as I sat right here at this same window watching another mugging. Carnival vacation was coming up and I was thinking of going to Margarita Island. I called my buddy Jose, the travel agent, asking about some cheap place in Margarita, airfare, car rental. How much would it cost for four days? -I asked Jose.

Are you nuts Oli? Margarita? Why would you ever want to go to a crummy place over there, when you can fly to Aruba, stay at a fancy Hotel and have good service, running water, electricity and smaller crowds at a cheaper price? You can even bring back some sugar from the trip! He said.

By now I thought Jose had smoked an egg roll, like Aristobulo accused Chavez a few years ago before Chavez named him Minister. What are you talking about?

It’s easy Oli, said Jose. The airfare is more expensive, but you pay at the official rate of exchange. On top of that, you go to Aruba and ask CADIVI for your travel dollars, you get $5,900 total at the official rate. With that you can stay at a better hotel than in Margarita for the same price, eat food of better quality, but cheaper and the money you don’t spend, you can go to the Casino, buy chips, bet on red for a couple of spins, cash in and you have now received your full CADIVI allotment at the official rate of exchange. You sell those dollars in the swap market and the trip ends up being almost free.

Wow! I told Jose, I didn’t know any of this. How do I get started? Well, just come tomorrow to my office with your passport, register at CADIVI and we will get the ball rolling.

Passport? I don’t have a passport, how fast can I get one? – I asked Jose.

Well, you know it is very complicated, but just give me Bs. 200,000 and I have a buddy that will get it for you in a week, unless of course you signed against Chavez in the referendum. Did you?

Of course I did Jose; you know how much I dislike Chavez!

Well, Oli, in that case, you will have to give me Bs. 500,000, Tascon cases are much tougher and more expensive.

At the time I thought-thanks God for free enterprise!- remember I was still an oligarch then. But clearly free enterprise in the robolution had saved my trip. Within a week, I had my passport; my $400 in cash from CADIVI and my tickets and off I went to Aruba. My transformation into a XXIst. Century Socialist man had begun.

Aruba was grand, I met a gringa there, we partied for four days and in the end I spent about $1,800. I came back to Caracas, sold the remainder $4,100 at Bs. 4,200, and with those 17.2 million Bs. I paid the 3.87 million of the trip, the 8,8 million for the remainder dollars and pocketed Bs. 4.5 million “profit” from my vacation.

That was as much as I made in a month working hard at my job at a local steel company, where I have to show up early, work hard, stay late, worry about things. I began to see that something was seriously wrong with the capitalist system and maybe Chavez was right about this XXIst. Century Socialism after all.

The next day, I woke up early and even though I don’t usually read the paper, I saw a headline about a Bono del Sur coming out soon. I wondered what that was about, but since I know nothing about finance, I called my other friend Miguel, he has a blog and writes often about such topics, and maybe he can explain it to me.

It’s simple, Miguel said: The Government sells you a bond which has different parts in Bs. And $. You pay for the dollar part at the official rate of exchange, you turned around sell the parts, get back some Bolivars, get back some dollars and you sell the dollars in the parallel swap market, for each dollar you get you make about Bs. 800. Some brokers lend you money, so that you can finance part of the order and get more than the Bolivars you have. I said this did not make any sense and Miguel went into a tirade about liquidity, absorption and such terms, which I barely understood, but he seems to know what he is talking about, so I went to the broker across the street from my office and placed an order for $20,000, borrowing half of what I would get.

I was assigned $8,000, half of it was in $, sold them and lo and behold I had added Bs. 3.2 million to my Aruba kitty in a flash.

I called Miguel to thank him and when I was about to hang up, he said: “Well, have you asked for your Internet CADIVI dollars?” Huh? I said, no I have not, how much is that? Well, Miguel told me, you get $3,000 at the official rate of exchange.

Within two days, I had used this quota to buy a new Mac, a printer, an 80GB IPod and a Bose speaker system for my iPod. I also looked into buying an iPhone but learned it does not work here, so I used the last $500 of my Internet quota to buy an external hard drive, a WiFi system and a digital camera. Wow! It was late March and my standard of living had improved significantly and my doubts about the robolution began to surface. Had I misjudged Chavez? This was really a different life. No competition, no hard work and big payoffs, what else could a young oligarch ask for? Or was I turning into a socialist? A lot of my kitty had been spent, but my home was now part of the space age.

Soon after all of the Apple stuff arrived, the Government announced the PDVSA bond. Time to call Miguel again. He says is a steal, I jump in, asking for 100,000 dollars, 90% of it financed by my bank as long as I keep it for month. I tremble at the thought ,but go ahead anyway. Remarkably, I am assigned 45,000 dollars at an average price of Bs. 2,900 but have to wait a month to sell them at Bs. 3,500 and make a tidy Bs. 600 profit per dollar. But I am so lucky that after a month the parallel market is up to Bs. 4,000, I make Bs. 1,100 per dollar assigned and now I have a whopping 49 million Bs. in my pocket. That is more that I make in one year!

It is at that point that I realize how little I have understood the revolution up to now. Of course it’s appealing. You get everything for free, you don’t have to work. I could make more money if I worked hard; develop contacts to get contracts with Government outfits and the like. But why bother? In one month I have made more money that in one year busting my butt working at my job.

So, I quit my job and have joined the ranks of the informal economy. I wake up late everyday. What do I do? Easy. Everyday I look for someone I know without the means to buy the Internet quota that the Government gives them. I help them get a debit card and through a friend in Miami I “spend” their whole quota. Each quota costs me 6.45 million Bs., I sell the dollars in the swap market at Bs. 4,900. The difference is Bs. 8.25 million, I pay my clients 1.5 million for their quota, and so I net Bs. 6.75 million per client. That is why I only work one client each day, I have joined the ranks of the XXIst. Century S
ocialist. Minimum effort, maximum return. Twenty clients a month net me three times what I used to make at my old job. There are no benefits now, no health care. But hey, I do little and make so much more. Lots of time for partying! I practically live at Tinajero de Los Helechos after 4 PM, where my fellow socialists invite me to drink 18 year old Scotch.

I still don’t wear a red shirt. But a friend told me I could go to a PSUV meeting wearing one and maybe I could sign up twenty people as clients in one day. Just think! I would only have to work one day a month that way!

I belong now. I have seen the light. I love the robolution. It treats me well, even if I disagree with it. I barely work. I can’t wait for the new year, so I can go to Cancun with next year’s quota. I have jumped into XXIst Century Socialism!

And I may even change my name, Chavistas have a hard time with it, even if I tell them to call me Oli.

I do belong now!

In short…news from the robolution

September 20, 2007

Not much time to post, but a few short tidbits about revolutionary happenings of revelance and interest:

—-As I predicted in the comments section of the time zone post, the Government has postponed its implementation as the improvisation was simply too much. The announcement will be made by Chavez himself, who has already announced it twice, but will give it the old college try again sometime soon. Nothing had been done about the legal and international aspects of things, despite claims that nothing needed to be done as this was a sovereign decision. I guess it has now been confirmed that the clowns themselves are running this circus and you will have to wait to “obtain the positive effects in your metabolism from the organic, functional, intellectaul, systemic and productive point of views”. Please don’t laugh, this is very serious revolutionary stuff.

—-And speaking of sovereignty and independence, now that the US Federal Reserve has acted, the Ministry of Finance has announced the “new” and “improved” Bono del Sur III. When the older version, which was canceled was announced I criticized it and said it was not worth it, the relaunched version removes some of the drawbacks of the earlier one, whether it is worth buying it or not will have to await until Monday when the price is set. For now, I can tell you the issue size was reduced to US$ 1.2 billion, half of it will be in an Argentinean Boden 15 bond and the other half of a so called TICC due in 2015. Thus, you will get half of what you are assigned in US$, compared to one third in the old version. Stay tuned!

—-And the same man that said the CIA was spying on us via the Direct TV set top boxes, Minister of the Interior Carreño, today suggests another innovative theory: Violence in Venezuela’s jails is due to a destabilization plan by those that oppose the Government. This plan must have been in effect since Chavez took over. I guess they have jailed too many of them…What’s next? The tripling of the number of homicides since Chavez took over is the result of random killings by the opposition? Minister Carreño should realize he has been incompetent in his position and resign, as simple as that!

—-And in another revolutionary triumph, the Minister of Feeding announced in a press conference today the arrival of 14,000 Tons of sugar and 1,650 Tons of black beans to alleviate shortages. Of course, these products were imported at the official rate of exchange and will be sold at controlled prices, insuring that no farmer in Venezuela can compete in prices. This will lead to more shortages in the medium turn, but try to explain this complex issue to people who still are not clear whether you move your clock backwards or forwrads in order to get more daylight. The Minister, dressed in military garb to show his authority and power, also clarified that the milk shortage is a worldwide problem and not restricted to Venezuela. (Would love to hear from readers abrad who are experiencing milk shoratges in their own countries)

—-And in another act of sovereignty, the Mayor of Bolivian city La Guardia, returned the check (for US$ 32,784) given to him by the Venezuelan Government because…it was less than what he was promised. Jeez, we all have our pride and our price!!! And it is above US$ 32,784 in La Guardia, Bolivia.

More evidence and proof of rights violations by PDVSA authorities

September 19, 2007

While it is only Chavista fanatics and fools that still have the audacity to deny the wholesale violation of people’s rights by the Chavez administration in the face of overwhelming evidence including Chavez saying on his variety show Alo President that the Tascon/Chavez fascist list should be buried, more and more compelling evidence surfaces as days go by. Of course, in the absence of the rule of law and independent powers, this evidence is useless, but hopefully, one day the day of reckoning will come and Chavez, Tascon, Ramirez and cohorts will have to face a Judge and account for this massive violations of human rights and the Venezuelan Constitution while in power.

The latest compelling evidence was published by Tal Cual yesterday in a new (and extremely dumb!) letter signed by the Board of PDVSA, entitled “General Policies for hiring personnel or contracting suppliers”. In it the Board “prohibits the use of any selection criteria …which violates the principle of equality participation and transparency privileged in Venezuelan law to disqualify people or companies…”

This is followed by a sentence saying that the letter replaces any previous ones (aja!) and that only the “Verification Criteria” can be used. This “criteria” on the right are clearly in violations of people’s rights. While PDVSA can argue that it should not hire anyone that participated in the 2002/2003 strike, up to today not one case has been processed y Venezuelan Courts to prove that anyone did illegally participate in the strike or caused any damage to PDVSA. Thus, PDVSA would use an arbitrary criteria in establishing this for hiring.

But what is clearly discriminatory and in violation of Venezuela’s legislation is to reject suppliers, either because they are owned or have personnel which is in PDVSA’s database of people that participated in the strike.

This letter clearly demonstrate that discrimination for political reasons continues in PDVSA under Chavez and it admits that other procedures, such as the Tascon/Chavez fascist list have been used in the past to discriminate against those that disagree with the Government.

In fact, such discrimination is widespread, as anyone who worked at PDVSA and was illegally fired in 2003 is in a black list used by most Government institutions and can’t possibly find a job with the Government. This has particularly hit hard people with high academic qualifications, who have had to emigrate as all research institutions in the country and most academic ones are run by the State.

PDVSA 2006 oil production and exports numbers

September 18, 2007

While I haven’t had the time to digest and analyze the PDVSA financials finally published last week, I did look at the production numbers reported with the financials. Below, I post them as reported for 2006 and 2005 and I reconstructed the same type of reporting from the SEC financials for 2004. (For some reason I don’t understand the date on the left column for 2006 moves to the right when I convert it into a picture, thus assume that 2006 is right to the left of the 2005 while I figure out what to do)

PDVSA production in ‘000 barrels a day.

I will only make two comments about these numbers, which are not credible:

1) The Export numbers are funny. PDVSA has been reporting the “production” from the Orinoco oil belt as the amount of oil generated before the oil is processed in the upgraders. Basically, you improve the quality of the heavy crude and then sell it for more. In the process you lose oil, as demonstrated in 2004 in the SEC filing, when production was 601,000 barrels a day, but the barrels out of the upgrader (which is what you can sell) were only 439,000 barrels. But magically, in 2005 and 2006 the numbers are essentially the same for production and exports, despite the fact that in the previous years and as reported to the SEC, the average “loss” in upgrading was 15%. No such loss in 2005 and 2006, which is difficult to understand.

2) The second number which is not believable is that the difference between imports and exports is only 299,000 barrels a day. Supposedly, that would be the daily consumption of gasoline of the country, except that PDVSA also imports oil. And that is where the fudge factor comes in. Nobody knows how much PDVSA imports each day.

During the year PDVSA says it spent US$ 5 billion on importing oil, which would imply 249,000 barrels a day in imports of oil, which still makes no sense as six years earlier, in 2000, gasoline consumption was already above the sum of the difference plus imports and I am not taking into account that you don’t get a barrel of gasoline out of a barrel of oil.

However, I got the US$ 5 billion from the financials where it says “Purchases of Crude and products National Sector”, but under “International Sector” there are some US$ 53.7 billion in purchases,, which correspond to CITGO purchases. However, you can always do intercompany swaps between the international and the national side of PDVSA, which would hide the true reality of the situation, which seems to be what is being done. In fact, using this, PDVSA could claim any number for its total production and/or exports.

What is clear is that the number, as usual, exhibit some serious inconsistencies on the production and export side of things.

More on the financial part later.

The Chavez brothers show their arrogance and ignorance on the time zone issue

September 18, 2007

It was a sight to see, the autocrat himself acting dumb, failing to understand a simple concept, while he claims to understand very complex economic problems and issues on which he makes decisions and creates new systems without any expert advise, followed by his brother the Minister of Education acting even dumber on the subject of which direction you have to change the time next Monday to implement Venezuela’s new revolutionary and useless time zone.

You may be able to forgive the autocrat, after all, he was poor and could not go to the University, while his brother somehow was rich and managed to get a degree in Physics from the University of Los Andes, which should have prepared him to understand this very simple issue.

But the worst part is that both acted with their usually know-it-all arrogance, as some people in the public attempted to correct them. But no, the revolution and their leaders are never wrong, the Chavez’ are never wrong and the issue was closed by saying that next Monday you should advance your watch half an hour in order to have the sun come out earlier.

Yeah! Sure! Which only shows how improvised and brainless this stupid decision is, like so many things in the robolution.

Chavez threatens to take over private schools, just because…

September 17, 2007

Things are getting to be quite bizarre in Venezuela these days. The autocrat/dictator is no longer content to threaten and confront everyone in his tropically original interpretation of what a democracy is or should be, but much like his XXIst. Century Socialism, which remains undefined, he threatens those that do not follow his as yet undefined “Bolivarian Educational System”. Much like many of Chavez’ threats, you are warned not do do something which is not defined or he will do what he wants to do anyway: Take your property, kick you out (ask Podemos!) or simply call you a coup monger, the favorite insult of the only man that has actually promoted armed and bloody coups in Venezuela in the last 40-plus years.

But you have to wonder about a man who, after his Sunday variety show yesterday which lasted a few hours, finds the need to come on ranting on nationwide, obligatory broadcast on all TV and radio stations this morning, just because today was supposed to be the first day of the school year for all kids up to high school.

And rant he did in his best style, proving once again what a resentful person Chavez is. Not only did he threaten to take over the private educational system, a system born out of the same inefficiencies that prevail today, but rather than illuminate the real reasons for its existence, Chavez blasted them suggesting theer was some sort of macabre plot to privatize education, rather than a politicized and extremely mediocre educational system which drove people away from it. In fact, to this day, most Chavista leaders, Cabinet members and civil servants send their kids to, you guessed it, the same private schools that the autocrat criticizes. The reason is simple, the public educational system is terribly bad (not that the private one is great, it is simply better and parents always want what is best for their kids, even if it s extremely cynical to talk revolution with one side of your mouth and send your kids to private school with the other).

While Chavez filled his mouth with the “new” 1,000 Bolivarian schools, it was typical and grandiose Chavezspeak, as very few of them were “new”, they were “new Bolivarian”, that is old schools of the public educational system converted to the Bolivarian system. Because while he may boast that he would prefer to build schools over trains, which few of us would disagree with, the fact is that Chavez’ accomplishments in school building are very poor, adding in eight years of his undemocratic rule, less than 10% of the numbers of schools in existence. Not a record to boast about when you realize that 85% of the existing schools were built in the “horrible” 40 years of the IVth. Republic, but he has already been in power for the equivalent of 20% of that period, without similar accomplishments and despite the huge oil windfall in at least half of his Presidential term.

But much like in Hitler’s Germany, Fidel’s Cuba or Franco’s Spain, Venezuela will now have official textbooks for all subjects, guaranteeing no impure ideas get through to the kids and all information gets the imprimatur from Bolivarian officials. I wonder if they will be signed by a Bishop or a General as a sign of approval or by the autocrat himself maybe.

Because according to the autocrat, texts used to preach the theories of the Empire, whether the North-American or Spanish one (Did Chavez look up pre-1724 textbooks?), but then the ranting got better when Chavez truly and really said:

“First, it was an ideologic education, the euro-centric vision, colonial, which taught us to admire the conquerors and then the cult to the animated characters of Superman, Mandrake or the Phantom, denying us the knowledge of Guicapuro, Negra Hipolita or Sucre”

Jeez, I wonder where he heard about these, as I do not recall learning about any of these characters in school, but I do remember learning about Guicaipuro, Negra Hipolita and Sucre, and was always taught a very negative view of the Spanish conquerors which cost me quite a few expulsions from class when I lived in Spain.

But the country is a hostage to the mind of this resentful man, whose view of the world is distorted by his own complexes and misconceptions. He wants a rural country, when 90% of the population lives in cities. He wants a Venezuelan citizen who not only does not exist, but he is barely a representation of. He wants Bolivars’ thoughts to inspire us all, when most are looking for leadership in modern technology and knowledge, which he cares little for. Everything is either “Bolivarian” and/or “popular”, when few of the precepts of Bolivar are ever followed even by the autocrat himself and when power is slowly being removed further away from the people in order to preserve his own autocratic and perennial powers.

But the folly continues in the name of the robolution. Replace what is available independent of whether it is any better, just because Chavez says so. Threaten and scare everyone into following his orders just because he feels like it, even if there is no legal basis or definition for what he wants or desires. It is the same tiring style of confrontation, threats and coercion just so that the Dictator can get his wishes as Venezuela’s democracy withers into oblivion.

What I (fortunately?) missed reading about while I was away

September 16, 2007

–Minister of Finance Cabezas said that the decision to stop lending operations was the Central Bank’s and had nothing to do with Chavez saying that that the Central bank should stop lending to the banks and concentrate on the people.

Yeah, sure!

–My read on the polls is not only that most people are against the Constitutional reform, but that most people care little about it and are asking what teh reform does to them.

—The National Assembly approved Chavez’ proposed Constitutional reform for the second time (three are needed). Political Party Podemos abstained, which in Chavez’ concept of democracy earned it being declared an outcast party and now part of the opposition.

And some people still think Chavez is a democrat…

—And how about Chavez’ grandstanding on the Colombian hostage issue? He is willing to meet and talk with Marulanda, but does not even talk to anyone in the Venezuelan opposition and has never done anything among the more than 70 Venezuelans currently kidnapped.

—And after four years of exchange controls, the Government is concerned about fraudulent requests for foreign currency for travel. Only 20% of passports issued recently have been used to travel, but the foreign exchange control office requires a passport to approve the US$ 5,000 quota for travel.

—The Government plans to make the State’s banking system competitive with the private sector.

I heard that eight years ago…

—ExxonMobil went to arbitration on the expropriation of its Cerro Negro heavy crude oil project, despite Minsiter Ramirez’ claim that an agreement was “close”.

—President Chavez said that he will “gassify” the country, invest US$ 18 billion in the sector but has yet to say where all the gas will come from. Most Venezuelan natural gas is associated with oil production. Since production is down, then how will this grandiose project work?

The post that did not appear on time

September 16, 2007

I tried to post this message before I left a week ago, but the server apparently crashed right after I posted it and left. Thanks to those concerned due to my absence, it was a great family week!

I will be away for about a week on a family vacation. Will post if
something happens that is important.

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