Hugo plays at being rich, while beggars and strangers bearing gifts visit Venezuela

April 2, 2010

Today Chavez had a couple of visitors, one a beggar, Evo Morales from the Bolivian altiplano, the other one a stranger bearing expensive gifts, Vladimir Putin, from the cold steppes of Russia. Evo was probably taking advantage of Putin’s visit, wondering if in the multi-billion dollar discussions between Hugo and Vladimir, he could squeeze a few million out of his buddy. Vladimir, trying to seal deals and get commitments out of Hugo for weapons and useless trinkets, before Hugo’s money runs out.

Although the more cynical observers suggest that Vladimir came to seal deals precisely because the money is running out. They figure that Vladimir wants oil fields in exchange for trinkets like weapons and power plants, while the oil fields will become Russian property when and if the money runs out. At the same time Vladimir can play world politics, playing buddies with Hugo, making Obama and Hillary cringe.

So, while Chavez and the incompetents surrounding him can’t provide the most basic services to the population, the Russians claimed Venezuela would buy 50 war planes from them, while Hugo signed an agreement for cooperation on space exploration, a $20 billion investment in the Orinoco Oil belt and, of course, how could I have left it for last, Chavez’ dream of having nuclear energy now that he seems to have screwed up all of the country’s power system.

But unless oil prices shoot up to the stratosphere that Chavez wants to help explore, money seems to be getting very short around here, so when Chavez talks about a US$ 20 billion investment in the Junin field, he seems to forget that since by law (his new laws!) PDVSA has a minimum of 60% of all these projects, PDVSA has to come up somehow for its US$ 12 billion in this project and you have to add the Carabobo projects, all of the electric power plant investment needed now (smaller oil exports!). a possible setback in arbitration for expropriating oil and cement projects and, of course, funding all his entitlement projects. (Imagine Chavez telling Evo: Please don’t interrupt, we are talking billions here, so, yes you can have your $125 million, but please shut up Evo)

Because besides the “needs” above, there are signs that money, particularly dollars are not as easily found around the Venezuelan Government as it used to be. The first sign was the January devaluation, while expected, that Chavez would allow a 100% devaluation for most important items took many (all?) by surprise. Other signs have followed: The slide in the swap rate, the 15% decrease in international reserves, the slower outflows from CADIVI despite the higher exchange rate and even Chavez’ lower number of trips abroad.

And I have to wonder if Chavez was shown the somewhat gloomy projections by Morgan Stanley (Thanks to the reader who got me a copy!) in their latest report on Venezuela (Maybe Evo came because he saw them). These are the darkest predictions I have seen so far for the balance of foreign currency in Venezuela in the upcoming years:

The graphs are the result of modeling the country’s dollar balance using the trends in import growth, capital flight, oil output decline, rising local oil consumption using the future oil prices as predicted by the oil futures market. Then, there are two scenarios: In the “severe” scenario” (Top graph), the projection is made using the trends of the last three years, In the benign scenario (Bottom graph), they use the trends of the last twelve years.

In each scenario there are two projections, which reflect simply whether the Carabobo projecst will or not contribute to the dollar balance before 2015. (Note that the first step after the two fields were assigned was not complied with, contracts were supposed to have been signed last week, they weren’t. Apparently the Government is not complying with any of the changes it offered to make in the contracts before the auction took place)

As you can see the dollar balance deteriorates fast in both scenarios, reaching -US$ 180 million by 2015 in the “severe” scenario and -US$ 100 billion in 2013 in the “benign” one. In fact, there is little difference in the overall trend in either case, what changes is how fast they develop. In the severe case, there is a net deficit of US$ 5-10 billion by the end of this year, while in the benign case it only happens in 2011. Thus, the problem is the prediction, the time scale is irrelevant given the numbers. The point is that in both, Venezuela would have to find some US$ 60 billion in financing sometime between 2011 and 2013. At Bs. 4.3 per dollar this implies increasing the country’s debt to an amount roughly like the GDP of Venezuela, a Greece-like number that seems far-fetched to fulfill.

Thus, Chavez should land soon on his true reality that he can’t even meet his local expenses, let alone fancy-schmanzy space and nuclear power projects which would cost billions under his command.

But Vladimir, Evo and yes, Fidel and Ramiro, will take whatever they can get until someone tells Hugo that he is in deep…trouble.

46 Responses to “Hugo plays at being rich, while beggars and strangers bearing gifts visit Venezuela”

  1. speed Gibson Says:

    Venezuelans in space…….now theres a movie there somewhere

  2. island canuck Says:

    “…the other one a stranger bearing expensive gifts,”

    Not exactly gifts as you pointed out. This megalomaniac has bankrupted our country & the misery is soon to come.

  3. HalfEmpty Says:

    Well, at least he’s getting some usable aircraft. A nice short-field transport is a lot more utilitarian than those air-defesne (US targets) machines.

    Looking up the An-148 a little more… looks like an excellent choice, designed for primative air facilties and easy maintenance.

  4. Robert Says:

    The dollar shortage implies a severe reduction in imports and subsequent shortages, no? How could this be turned around? What instances, besides 200 dollar oil, would prevent the impending suffering in Venezuela? Or is it a foregone conclusion?

  5. Otro Roberto Says:

    I would have included the word “red” as part of the closing (red figures, red revolution – I believe that they go hand in hand perfectly) : deep red xxxx, sorry, trouble.

  6. Alpha Says:

    Miguel thanks for sharing the financial graphics.

    What do we have, an army-race, a space-race, or is it a space-cake for Hugo?

    Now Putin can say, if we had indications that Venezuela is supporting Terrorist he would never visit Venezuela.
    It was smarter if he just checked your website about the financial situation of Venezuela. Then he was never visit a country that is running into a bankruptcy.

    Miguel, I also used the graphics´ for my site.

    saludos
    Alpha

  7. LD Says:

    Miguel, could you explain the calculations of the dollar balance a little more please? It looks too bad to me, I was thinking of an april’s fool prank…
    How comes that “suddendly”(it looks all normal until then)? Thanks!

  8. moctavio Says:

    Well, I gave as much explanation as they did, basically, they look at increasing imports over the years, more demand for dollars and lower oil production. It is not that it looks so “bad” all of a sudden. In the previous years, the Chavez Government had savings in funds (mostly gone) and borrowed money (last year 12 billion in the second semester). The problem is that you can do that once or twice, but not 80 billion in two or three years. The previous years you see a balance because of that borrowing. How much can they issue this year? Maybe 10 billion, no more, the same in 2011, but they can’t increase it.

  9. moctavio Says:

    As to what can be done. Simply very little, devalue until things get so expensive that you make it in Venezuela or people stop buying stuff. The rest is long term solutions which Chavez is not good at. People will pay for it as usual.

  10. Eric Lavoie Says:

    Basically it drops when the last pennies that were put aside in the past are gone. They spent and mortgaged what previous generations saved. Would that be a way to explain it?

  11. moctavio Says:

    Not really, there was a huge surplus from the oil boom in 2008 that was saved, but spending money in buying existing concerns rather than investing and policies that go against private investment and production simply destroyed local production and imports soared. Chavez survived 2004 on because of higher oil prices, if they had stayed at 30-40 he would ahve feaced this crisis. Thus he now needs 150 to survive.

  12. m_astera Says:

    I take the satellite launch facility seriously. Arianespace has had success with their launch site in French Guiana; there are some important advantages to equatorial launch sites.

    Putin is no one’s fool. I think he’s looking for Mr Desperate to sign away anything, the whole country even, for the promise of money or the chance to stay in power.

  13. ow Says:

    At $80 a barrel there isn’t any crisis and they won’t face a cash crunch – particularly given that they devalued. I can’t imagine what the people who made that graph are thinking of.

    Oil production will probably start going back up as OPEC is happy with current prices and doesn’t want them to get to high.

    Venezuela certainly has big problems and growth will be very mediocre at best given their lack of investment, lack of planning, pissing off the private sector but not really replacing it either, etc. But to say that it will not grow or maybe even shrink some is something very different from saying it will be in crisis or face some severe cash crunch. Only if oil prices go back to around $50 per barrel do they have those problems.

    The U.S. and Chinese stimulus packages certainly helped Venezuela a lot.

  14. moctavio Says:

    How do you explain then the drop in reserves, despite the low CADIVI outflows and lack of intervention in the swap market? Venezuela does not get paid for all its oil inflows and given that it is now a hyperinflationary economy, companies have no need to keep bolivars because of the new accounting. This means more buying in the swap market than ever.

    Last year there was a cash crunch, the Government solved it by borrowing 12 billion and using Fonden money. If those numbers deteriorate due to higher imports, more buying in the swap market and lower oil exports, I don’t see why they would not be a cash crunch in dollars, which is what these guys are calculating. Venezuela can not borrow forever out of this and with the Greek crisis people are weary of new debt by any country.

  15. Bill Simpson of Slidell USA Says:

    Putin will give your Venezuelan astronauts a free ride to the Space Station, if you buy enough of his weapons. It may be a tad late to get into the commercial space launch business, with the US, Russia, France, Japan, China, and India already doing it. Brazil might be next. Oil would seem a better return on investment.
    No doubt those Columbians are dangerous expansionists! Beware, as soon as they take Panama back, Venezuela will be their next target for conquest. Thank God that the invasion threat from Guyana seems to have waned, at least for the moment. And those Netherlands Antilles radicals are probably armed to the teeth. Hugo recognizes that Venezuela is surrounded by dangerous enemies. He will need hundreds of jets. Ballistic missiles will soon follow. Can centrifuges be far behind? That might make your neighbors a little nervous. I wonder how Brazil would react? Arms races aren’t cheap.
    The big defense contractors are probably praying for Hugo to spend a lot more on weapons, especially on jet aircraft. Those jets and anti-aircraft missiles cost a fortune, and a new South American arms race will make them very, very happy. They might even send Putin a Christmas present.

  16. GeorgeS Says:

    ow; Devaluing does nothing to the dollar cash crunch, unless demand collapses because things get too expensive. This will not happen because the swap rate has a large influence on pricing of non-essentials which is where the collapse has to come from.

    This model is not hugely sophisticated, they said imports have been going up at rate x, demand for dollars from capital flight at rate y and oil production is dropping at rate z and consumption of oil locally at rate w. In the benign scenario, they used 12 year slopes in the severe one they used three year slopes. Unless you show that x,y,z and/or w will slow down and why and how, these numbers are reasonable (holding oil prices constant or modeling from futures. I have done similar calculations and get very similar results.

    Unfortunately the Government has few solutions. It can devalue again until demand drops or it can increase the price of local gas dramatically to cause a collapse in that demand. That’s it.

  17. Lazarus Says:

    ow.. in the past Ramirez urged opec to maintain low production to raise prices. now he does the same for lack of additional oil capacity.. it isn’t there and won’t be for some time. drilling continues but is increasingly inefficient, for several reasons. first, the “strategic” agreements with none western companies to drill the wells. this has made each well drilled more expensive. with continued budget cuts less wells will be drilled, and the existing wells decline. to maintain production requires equipment, for various reasons not produced in Vz, and these are restricted for the same reasons as all imports. the widely reported non-payment to suppliers is a fact, and despite gov’t reports that debt to service companies is current, it is not true. There is a real fear factor to do business in Vz. an example is the continued delays in new projects, many announcements but no drilling or construction. refer to miguel’s blog on the premium on bonds sales, same issues and results in the oilfield. so expect the costs to continue to increase. bottom line oil production is not increasing and likely won’t for some time.

  18. BLAS Says:

    The more a hate this government, by reading this article which has all the sings of been incorrect, the more I understand why we (the democrats) are in such a bad shape, and what is worst, the interpretation of this non sense graphics is awful. We are just peeing out of the can.

  19. moctavio Says:

    Why incorrect? What signs? Are imports up year after year? Yes. Is oil production down year after year? Yes. Is local oil consumption up year after year? Yes. Is capital flight up year after year? Yes. Is money in Fonden etc. down significantly ? Yes. Extrapolate that and those are the numbers, no more, no less.

    These graphs were generated by economists who care little about Venezuelan local politics, they only care about their reputation in front of their clients. If oil prices stay where they are, their clients will be grateful forever for the advise they are getting.

    If you don’t believe it, sit down, look in the BCV website and do your own calculation see what you come up with. But don’t pee out of the can just because you don’t like the graphs.

  20. maracucho importado Says:

    again “animal farm” ,,,, remember the windmill snowflake (arias) wanted to bulid,,, napoleon ,(hugo) said it was nonsence,,, until he ran him off…. this mill was to produce electricity for the animals so they would not have to work hard and be warm in winter,,,, but a storm destroyed the first one and hugo declared arias responsibile.. after much suffering,, the animals rebuilt again,,, so the pigs, hugo in charge,,, could light the human’s house they now occupy.
    THIS JUST FOLLOWS THE BOOK,,, MUCH BETTER THAN THE CARTOON DID

  21. Roger Says:

    http://www.rigzone.com/training/heavyoil/insight.asp?i_id=193 This technology is very complex and involves very expensive R and D. Giving Chavez money up front is a good investment.
    SA Arms Race: They got to be kidding or are stupid. The problem is Insurgents. The FARC being the most noted. Colombia obviously does not control a large portion of the country. Venezuela not so much but after years of the Army getting their ass kicked in the jungle, well they just don’t go their anymore! Even Brazil has problems in remote areas near its borders. All show signs of having Urban unrest. And, we all know IED’s are far more effective than random landmines set in the jungle. Ask any US General, Fighters and Bombers are not of much value in Urban warfare which is where its at now.
    If you want to talk General War, Venezuela has as much chance as, Canada having of an arms race with the US, it could not defend its self against Brazil that makes fighters and bombers and the bombs and such. When all is said and done, it is the US that has protected Venezuela in the past, at present (regardless of what Chavez does) and in the future as long as the US wants to buy Venezuela’s oil!

  22. speed Gibson Says:

    its a matter of degree of course, but the parallels of whats happening in Venz under Hugo and in many “progressive” parts of the US are disturbing….capital and jobs flight in particular… the two articles below are sadly tailing

    http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/04/03/BU491CO3TD.DTL

    http://www.nypost.com/p/news/business/small_biz_big_tax_Tm9zntbp2I339WyBwwOgzK

  23. ow Says:

    I still doubt they will have a shortage of dollars this year, or possibly even the next year or so depending on oil prices.

    Oil prices for them last year averaged about $55. I think they are averaging about $70 this year. If that is maintained throughout the year that is $15 billion in additional dollar revenue (assuming the standard of $1 in price increases leads to $1 billion in additional revenue).

    Also, if anything oil production will go up this year, not down. They had to cut 250 or 300k in 2008/2009 due to OPEC cuts. Some portion of that will probably be reinstated – probably at least enough to offset all the money they are pissing away by using their oil to thermo-electric power.

    Yes, barring oil going well over $100 per barrel the oil boom is definitely over and not coming back. And the economic policies pretty much guarentee that their economy will be on a steady downward trajectory. But that is very different from saying they are about to fall off a financial cliff.

    For me to belief anything that dramatic the creators of that chart would have to give the actual numbers behind all their calculations (ie, what do they assume for oil production, the price of oil, imports, etc.).

  24. moctavio Says:

    Last year they had a 12 billion dollar deficit.

    Last year they used 16 billion from Fonden.

    Oil production up? Dream on

    How about local consumption up by 100 thousand barrels? Or do you think all those electric power plants run on air?

    You are assuming a 3 million barrel a day production and that Venezuela gets paid for all of it. That is the “official” line that few believe, so obviously your estimate will be higher.

    Add additional capital flight and even with your numbers (except production up) the hole is around 15-17 billion.

    But

    Can Venezuela borrow 12 billion again this year? And again next year? And the year after?

    If not, you are in a 40-50 billion dollar hole even with your production numbers.

    BTW average last year was almost $58, accoding to PDVSA’s monthly average it was $57.73, you lose almost 3 bucks right there too.

  25. moctavio Says:

    They tell you exactly what they used, they dont believe the official export numbers, nor internal consumption numbers. The rest they use is all public numbers.

  26. Kepler Says:

    Miguel,

    And isn’t there a way they can prevent some capital flow in some drastic, even unkosher way?
    Take that and a new round of devaluation…
    apart from that I only see Venezuela selling off oil fields to Chinese and Russians and the government announcing that as “investment”.
    Russians are already in pretty bad shape. I don’t know how far they are going to bet in Venezuela. It seems to me from next year we will see more of Chinese than anyone else in Venezuela.

  27. An Interested Observer Says:

    Dan Burnett, if you have terminal cancer, and the doctor gave you one month to live two months ago, is the cancer therefore not going to kill you? You can dither all you want over when, but I notice that you make no effort to persuade anyone that the end will be anything but a disaster.

  28. LD Says:

    Then maybe we would be reading something like that in the future:

    N.Korea ‘executes two over bungled currency reform’
    North Korea has executed two officials over a bungled currency revaluation which fuelled food shortages and sparked unrest in the isolated communist state, a Seoul-based group said Monday.

    Pak Nam-Ki — whose execution had been reported earlier — was shot dead along with an unidentified deputy head of the National Planning Commission, the Internet newspaper The Daily NK reported.

    South Korea’s unification ministry said it could not confirm the report.

    http://www.google.com/hostednews/afp/article/ALeqM5hi7yJvDj1jhS6Keo8vm7BetVQAbQ

    By the way, is there nothing more to do or Morgan Stanley take for a given that Chávez would be reelected?


  29. [...] Hugo plays at being rich, while beggars and strangers bearing gifts visit Venezuela [...]

  30. LD Says:

    moctavio Says:
    April 5, 2010 at 11:15 am
    “Whether Chavez wins or loses in 2012 is irrelevant for that calculation.”

    but if the calculation goes up to 2015, then the decisions of the government should be relevant or it is a decided fate (nothing more to do?)?

  31. LD Says:

    OK, thanks! It looks really bad then!

  32. ow Says:

    I hadn’t seen the $14 billion in additional foreign debt number. If that was all used to pay ongoing expenses and they spent a full $12 billion from FONDEN then they may have a problem (though again, not a huge one). The extra $15 billion in oil revenue (or $12 billion as the case may be) would offset most of the debt. And FONDEN this year was getting a transfer of $6 billion so that makes up half of that money (yeah, they cheat to get the $6 billion but they cheated to get the $12 billion so it would seem to be the same thing).

    So they do have a hole but it isn’t unmanageable. They definitely can take on more debt (I totally oppose that but they can do it). They could cut back again on imports. They could raise the price of gasoline. They cut cut back on arms purchases and other non-essentials.

    As to the capital flight, that is a problem but one way to cut back on that is just stop selling dollars into the parrallel market and let that rate go to whatever it goes to. That has been a total waste of money from day one.

  33. ow Says:

    “if you have terminal cancer, and the doctor gave you one month to live two months ago, is the cancer therefore not going to kill you? You can dither all you want over when, but I notice that you make no effort to persuade anyone that the end will be anything but a disaster.”

    I’ve been hearing the sky is falling on this for 6 years now. I doubt the sky is just going to all of the sudden fall. If oil prices collapsed, yes. And that may yet happen. But it hasn’t happened to date. So they are just on a long downward slide. Not good, but not some dramatic collapse either.

    Does it end badly. Sure, I would concede this is almost certain to end badly.

    But don’t forget, it has always ended badly. Its not as if a well functioning country is being run into the ground here. The country has been dysfunctional for a long time and under no government that I am aware of did it have high levels of productive investment or diversification of its exports.

    Chavez is guilty of wasting a opportunity of historic proportions – probably no one has ever had or will ever have again such an opportunity to truly take the country forward. And he has squandered it. For that he deserves all the damnation that comes his way. But even if Hugo Chavez never existed, or if he disappeared tomorrow, the country is still in a very bad position with no one in the public arena even proposing solutions.

  34. moctavio Says:

    Yes, the point is they can cover this year, but if oil stays the same as it is now and reserves drop, it does become a big problem next year. MS is saying you have a 100 billion dollar problem in terms of deficit between now and 2013, you can cover 20-30 billion now and then? Then it becomes unmanageable, unless oil saves the day.

    I agree that nobody is proposing economic solutions. I am not sure it is a tragedy or simply The Devil’s Excrement at work, if you get so much money for juts being there, why thing about getting more. However, those that had ideas in the 90’s on how to change things were labeled forever. I would love Gerver Torres, Moises Naim and even Miguelito “paquetico” Rodriguez, have a say on where Venezuela should go. They were damned for proposing things that asked for less Government involvement in the day to day. Anyway…

  35. moctavio Says:

    The problem with the swap rate, is that it is a US$ 25 billion market, so you can no longer “let it go”, either CADIVI gives dollars or the swap rate soars, in the end the swap rate is setting prices more than the others.


  36. [...] Devil's Excrement Another Guri update: Corpoelec presentationHugo plays at being rich, while beggars and strangers bearing gifts visit VenezuelaThe recurring theme of Venezuela issuing a bond “backed” by goldSuperficial observations about [...]

  37. An Interested Observer Says:

    Dan, “sky is falling” vs “almost certain to end badly” is really just semantics. If you’re on the wrong end of it, will you see either of those as good news?

    “But don’t forget, it has always ended badly.” It seems that you are the one who forgot that, not me. Or at least, you took that as a reason to support Hugo, which was an illogical leap. He was “different” from the others – plus he was anti-Bush! – so how could you NOT support him? Easy – the enemy of your enemy (or even two separate enemies) has no obligation to be your friend. There’s more than two sides to things in the real world.

    “Chavez is guilty of wasting a opportunity of historic proportions.” And this has been obvious for years, at least to rational observers. But there are none so blind as those who refuse to see. Perhaps you are no longer in that category, but you were for years. Enthusiastically, I might add.

    THERE ARE NO SHORTCUTS. When Chavez came around promising them, no matter how he packaged them, you should have been wise enough to see that for the snake oil it was. It’s not like you didn’t have anyone trying to persuade you, and give you facts (with or without sky is falling opinions – you ought to be able to separate them) that should have woken you up.

    Short term plans will never yield long term benefits. Period. (Or fewer in the long term than the long term plans.) While Hugo’s predecessors mostly sucked, he’s taken this concept to a new extreme – and divided the country while doing it, which was entirely unnecessary (and somewhat original), and another reason why the country is facing such a deep hole. (And a big, big reason why no one else is proposing solutions – because it takes such an extraordinary effort just to overcome all the bogus political obstacles.) How do you dig out when the guy next to you won’t work with you, because his beloved leader has convinced him you are his enemy?

    Your cheerleading was disgusting, and I take no pleasure at all that you have now “seen the light” – assuming that is even real. This was never about me and you. It was about a whole country at stake. And still is, though now you seem to be shrugging your shoulders and writing it off.

  38. An Interested Observer Says:

    A couple comments on whether or not things will turn out as shown in these graphs – of course they won’t. I think MS would tell you the same thing.

    They are projections based on trends, which means the assumption that nothing will change, and the past 3 or 12 years are predictors of the future. But of course, things will change. And not just the variables, like oil prices, but other more important factors, like import levels/policy, devaluations, consumer behavior, inflation, all kinds of things that are reactions, rather than trend-based.

    The graphs point out a simple fact – Venezuela is headed towards a cliff, IF things do not change. But things will change, because not changing is beyond irrational. The point is simply that the future is drastic, and accommodating it will be uncomfortable – if not downright painful.

  39. keplerito Says:

    AIO

    in Re to your OW blast

    No fue conmigo y me dolio

  40. An Interested Observer Says:

    Keplerito, I’m not sure you’re feeling pain out of sympathy or what exactly, but when I said it wasn’t about him I completely meant it. OW is a nobody in this virtual world of blogs – as am I – because it’s ideas here that have power, at least as much as those ideas play out in the real world.

    I think I was grumpier than usual yesterday, and while that may have come out somewhat in my words, the truth is that I am disgusted by those with no stake in the matter who continue to support Chavez. Full disclaimer: I personally have no stake in the matter either, just concern over friends I made while living there who still live there, or wish they could, and the country in general. (I don’t wish crap like that on enemies. let along people I’ve never met.) So I accept concern about Venezuela as a legitimate motivation for weighing in on these issues, but that concern and support for Chavez ceased being compatible years ago. (It’s another story for many people living in Venezuela – I’m not addressing them at all.)

    I believe there are four possible motivations for such uninvolved persons to continue to support Chavez:
    1. Money. Could be direct support or a business arrangement, makes no difference.
    2. It’s part of a bigger agenda. Anti-Bush (Cindy Sheehan mugging with Hugo comes to mind) is an obvious example, though no longer valid. There are others.
    3. They realize they’re wrong, but pride precludes them from admitting it. (These could opt for fading quietly away, and I think several on some of these blogs have done just that.)
    4. Stupidity.

    Changing one’s mind at this point in the game is questionable, especially since – as Isa astutely notes – such thoughts are still completely inaccurate. Somehow, I think that irks me even more than just being uninvolved and a consistent supporter. Maybe it’s that the apparent change of heart raises questions that #1 or #2 above used to be true, but no longer is. It creates a suspicion of intellectual dishonesty (which would describe #2 in any case, but if that used to be true then not admitting it compounds that), and that’s something I simply can’t abide.

    Because what could his motivation be for posting comments like these? He says that “this is almost certain to end badly.” Fine. But then he tries to persuade us that Chavez is nothing but a typical Venezuelan President – at least, no worse. Even if that were true (again, see Isa’s comment, for starters), what good could he hope to accomplish by saying it? It’s one thing to truly believe Chavez is a good leader and try to convince someone of that. But that’s not what is happening here. There seems to be another level, and it can’t be anything good.

  41. m_astera Says:

    What is that series of stages?

    Denial
    Anger
    Bargaining
    Acceptance?

    Something like that. ow seems to be in the bargaining stage, seeing if there’s some slack to be found in “no worse than others, always been a mess, everything ends badly”.

    The response I see most frequently from “progressives”, liberal or conservative, when they see that the track record is no longer defensible is an attempt to dismiss it all: “it’s not important anyway”.

    All about saving face, all about ego, at any cost, even people’s lives and futures.

  42. An Interested Observer Says:

    There are five stages (of grief), with depression between bargaining and acceptance. I can see how you might call that bargaining, but I think that qualifies as denial, because that is denying reality. Despite the progression in his comments, he really may not have progressed at all.

    You can also see that by his “drive-by” commenting. Stirs the pot, poses the inexcusable justification, gets called on it…and disappears. I thought about predicting it in my last comment, but I was afraid it would be a self-fulfilling prophecy.


  43. [...] While I may not understand it, many interpret this as the Chinese giving Venezuela US$ 20 billion now, to be paid in dollars. With this, Venezuela’s foreign currency deficit for the year is no longer an issue, Morgan Stanley’s concerns get pushed until at least 2011. [...]


  44. Can I link to this webpage, from my web site? I’m wanting to gather as many snippets of useful information as I can.

  45. snorkel Says:

    A humankind begins scathing his insight teeth the first without surcease he bites out more than he can chew.


  46. [...] While I may not understand it, many interpret this as the Chinese giving Venezuela US$ 20 billion now, to be paid in dollars. With this, Venezuela’s foreign currency deficit for the year is no longer an issue, Morgan Stanley’s concernsget pushed until at least 2011. [...]


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