Redenomination is Venezuela’s sorry story of the day. It won’t work.
In a worthless attempt to halt hyperinflation, Venezuela Deletes Three Zeros From Its Failing Currency.
Socialist Venezuela is going through a crisis that has left people struggling to pay for food and find medicines. Prices are being influenced by a black-market exchange rate that rises by the day and is currently five times the nearly inaccessible official rate.
President Nicolás Maduro late Thursday briefly outlined his monetary rescue plan. In a country where a dozen eggs can cost 250,000 bolivars ($5) amid worsening inflation, he would chop three zeros off the currency — arguably bringing the price for those eggs down to 250.
By June 2, under Maduro’s plan, new bolivars with lower denominations would be circulated — but old ones, with denominations as high as 100,000, would remain valid. It would leave vendors charging two prices — one for old bills, the other for the redenominated bolivar.
Merchants are arrested if they charge too much for food. The result is no food.
Loot or Die
The Guardian reports ‘We loot or we die of hunger’: food shortages fuel unrest in Venezuela.