In Venezuela, prices rise every day as a result of a sick economy, mainly due to the exorbitant growth of money without public sector financing, and it is evident that the direct culprit is a political regime that has led Venezuela to its maximum deterioration, not only economically but also socially, but we are going to define it as hyperinflation: is the loss of purchasing power at a very high rate, which is when there is an extremely high rate of inflation. It is when the phenomenon of inflation skyrockets uncontrollably, when the price of goods and services increases in a generalized and rapid manner, that is what is happening in Venezuela today, at the same time the national currency the bolivar loses its value at an accelerated rate, this destroys the middle class and annihilates the poorest. Savings and pension funds evaporate, life insurance basically loses its value hyperinflation destroys the economy.
As an example I have a price list with the speed and amount that have gone up these last few weeks:
- Sugar from 150 thousand Bs. to 200 thousand Bs. in less than 15 days.
- Soap powder of 200 thousand Bs. It went up to 350,000 Bs. Also in less than 15 days.
- Rice from 110 thousand Bs. to 150 thousand Bs. In less than 10 days.
- Deodorant from 90 thousand Bs. to 135 thousand Bs. In 10 days.
- Tomato sauce from 90 thousand Bs. to 130 thousand Bs. In 15 days.
- Coffee 2 pounds of 250 thousand Bs. to 600 thousand Bs. In less than 10 days.
- A led light bulb from 200 thousand Bs. to 550 thousand Bs. In less than 10 days.
And so on is the rise with all the products.
In hyperinflation, the value of products in foreign currency is quantified instead of in local currency, even if there is a false exchange control, since this only affects the majority of the population, who of course are the most vulnerable. A'spontaneous dollarisation' is applied in which they prefer to hold savings and carry out transactions, as far as possible, in foreign currency for those who can.
The authorities practically lose control of their monetary policy and the national currency embarks on a process that may end up making it practically irrelevant, with disastrous consequences for the well-being of the population, who see their savings destroyed and find that their income loses value almost immediately after receiving them.
Behaviour in the face of hyperinflation
Preserving assets in bolivars is not an easy task, but keeping large amounts of money in the national banking systems is not a good alternative as it will be constantly devalued and after a certain period of time will be worth less than 50% of its starting value. The economist Gerver Torres argues that "hyperinflationary economies drive people crazy", and this is because at certain times people in countries such as Germany, Austria, Greece, Hungary and Poland have had to suffer periods of economic recession and inflation that have driven people to make irrational decisions and even to commit suicide.
Lissette González, a professor at the Andrés Bello Catholic University (UCAB), argues that the mere fact that inflation impacts people's incomes causes social problems such as increasing poverty in the country.
He asserts that constant price increases generate "anxiety in people", and that there comes a time when people "do not understand the prices of things", as the parameters for comparing the price of good A and good B are lost.
Venezuela's entry into hyperinflation for the first time in its history is the product of a mistaken economic policy that has established erroneous patterns over the years, in addition to the already serious humanitarian crisis marked by the scarcity and shortage of basic commodities such as food and medicine.
Venezuela also suffers from a shortage of banknotes, which force citizens to wait in long lines at ATMs to withdraw the little cash that the banks receive. The Central Bank has presented the 100,000 bolívares note, the highest denomination note ever issued, by order of Maduro. The largest banknote was the 20,000 bolivar note."This was something that had to be done, but the 50,000 bolivars would be missing, because there would not be enough to give the change, it should be printed at once to simplify the means of payment a little," said economist José Guerra, who stressed that the measure "is highlighting hyperinflation.
The concern of the population in Venezuela is more than evident, we are in the worst period of our history with a generalized crisis in all aspects, at this moment we Venezuelans who are fighting the battle in the country are armed with the courage to face some really uphill living conditions.
I think that at this time we must be more united to face the harsh reality we are living, we must now have clearer ideas, be more supportive, manage our resources very well and contribute all our talent and knowledge to resolve to some extent the priorities of our environment.
We are very valuable at this crossroads all of us who make life in the country, we have to make the best decisions and change must be imminent our country has to turn around 360 degrees to look for the trend towards progress, when we have faith in what is possible and work for it God will reward us.
I invite all those who contribute and participate in the Steemit community to leave their opinions on this vital issue because it crosses Venezuela.
Half of the world is suffering from wars and communal fighting, the rest is trapped in poverty and corruption. We need a widespread revolution.
What a tragedy! One of the resource-richest countries collapsing in chaos. Certainly resulting from terrible politicians and corruption. Some, but most likely only few, smart people have escaped into the world of cryptocurrencies beforehand and thus survived the war-like inflation.
It's war inflation. A war waged by delinquency against honest citizenship
It's totally a war caused by the obvious corrupt that the whole country already knows about.
It is correct what you say @lawking a smaller percentage of us have found the sustainable path of digital coins and blockchain, which has strengthened our financial structure, but unfortunately the majority in the country suffers the serious hyperinflation caused by all these corrupt agents that are destroying the country today.
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mis queridos amigos Venezolanos solo espero que crisis acaba ya... y comienza la nueva era para ese hermoso Pais.
Gracias por tus buenos deseos amigo.
We Venezuelans must spread how the Socialism and the Government began with Chavez (Maduro is just continuing and deepen the system of misery) has destroyed our country. Nor just the economy, but education, society, and even the morals of our people.
Good post!
Thank you if I have several publications that talk about how the regime in Venezuela has destroyed most of the institutions and everything they touch, from the electrical system to the properties that have been expropriated, the truth is the worst tragedy that has happened to the country.