And the people sucking up to the autocrat! My God! Where was
the opposition? Where was the “private sector”? Is everyone just trying to milk
the revolution to the last penny and leave? That seems to be the plan as a
strident silence permeated Caracas today, as things got more and more bizarre
and there seems no stopping to it:
—There was the Cemex show of course. Red shirts and empty-headed
radicals waving flags celebrating the expropriation of the cement company.
Funny, if the Venezuelan private sector could not run Cemex (then called Vencemos)
efficiently, is there any hope for the incompetent, inefficient and corrupt
Of course not. It will just be a matter of time. Meanwhile,
the Minister of Finance tries to argue that the company is
only worth US$ 400 million, because that is what it is worth in the Caracas
Stock Market. Thus, you clobber the market, violate its rules, drive away
foreign investors from it and then you try to apply “free market” rules to the
pricing, proving what a farce the whole thing is. Because Holcin,
was paid more than the US$ 400 million the Minister of Finance is quoting,
despite being a much smaller company, with a much smaller production of cement.
—Then there is the Comisión Nacional de Valores, the
defender of the small investor and supposed to defend the law they swore to
represent. They have said nothing ever since Chavez announced the expropriation
of all of the cement companies and surprise, surprise! Today they ordered
the halting of trading of the shares of Cemex “in order to achieve the transparency
of the markets”.
Hello! Did you learn about the Government’s intentions
today? Or were you on vacation, because the news has been around and the “halt”
in trading came so late, that some shares actually traded today before the news and halt came out. I guess the Comisión
Nacional de Valores was in Miami or Margarita this weekend because apparently
robolutionaries work less than five days a week.
Of course, this “transparency” did not include respecting the
country’s laws. How many times has the securities regulator stopped deals,
mergers and buyouts until the price was justified, but in this case allows the
Government to trample the law, investors and their own markets. What fools!
—And then, for those that thought the recent passing of 26
Bills is somewhat irrelevant, the “new”, “new” consumer protection agency confiscated
exactly 1,670 kilos of rice from the Excelsior Gama supermarket in Santa
Eduvigis in the East of Caracas and proceeded to sell it at the subway station
nearby. The charge? That the presentation of the rice had not been approved buy
the Government and as established by the Head of the “new”, “new” consumer protection agency, “rice
sold outside regulation will be sold directly to the public“.
These guys rally believe their BS, in fact, the Head of the
newly named agency stood at the subway station selling himself the regulated
rice to the public. Imagine his face when a very polite lady, bought a bag,
opened it and just threw it all over his face. You just don’t fool around with
my food provider seemed to be saying the lady.
—And just when I thought the day was over, I get a press
release which confirms that this is all part of Chavez’ gigantic folly. Electricidad
de Caracas, nationalized (legally!) a year ago presented its financial results
for the first six months of 2008, after the company has been in the hands of the
Government for twelve months.
In his short period of time, the robolution has been able to
turn the company form a Bs. 130 million profit, to a Bs. 13 million loss. This
came accompanied with a drop in 40% of the cash flow of the company and margins
shrank by 20%.
Now, think about it, this is a monopoly, you provide electricity,
you bill, you get paid. No payment you get the juice shut off. Simple business,
no? Well in barely twelve months we Venezuelans are already losing money.
Imagine running Cemex’ plans, or Cemex’s commercialization of cement, or very
simply, running Banco de Venezuela, in what is a very competitive business in
But I do hope that now that the Ministry of Finance says
that Cemex is only worth US$ 400 million, a reporter or someone asks him why
did the Chavez Government pay close to US$ 1 billion for Electricidad de
Caracas a year ago, after all, it is only worth 319 million in the local stock market
today. Why did they overpay? Is that illegal? Doesn’t the law punish this? Shouldn’t
we send someone to jail for this?
Of course, robolutionaries go to heaven or to the Swiss bank,
while everyone else is banned or sent to jail. Get used to it!
Ask yourself now: Who is next? One day it will be you…