Tuesday, July 24, 2018

Venezuela expected to surpass Weimar hyperinflation rate by end of year according to IMF

It appears that it is time to start going long on wheelbarrows as a new report from the IMF on July 24 estimates that Venezuela's hyperinflation will meet or exceed that of Germany's Weimar Republic by the end of this year.

Venezuela is facing one of the worst hyperinflationary crises in modern history, according to the International Monetary Fund (IMF). 
It expects the country’s economy to contract by 18 percent this year amid falling oil production – the third consecutive year of double-digit declines, and three points worse than projected in May. 
“We are projecting a surge in inflation to 1,000,000 percent by end-2018 to signal that the situation in Venezuela is similar to that in Germany in 1923 or Zimbabwe in the late 2000s,” said Alejandro Werner, head of the IMF’s Western Hemisphere Department. – Russia Today
Germany's hyperinflation came from the aftermath of World War I and the brutal sanctions imposed upon them by the Versailles Treaty.  Venezuela's hyperinflation however is a product of the Socialist policies of Nicholas Maduro who took over leadership in Venezuela following the death of Hugo Chavez.

What stands out the most in Venezuela's economic plight is that they are a relatively industrialized country, with some of the largest oil reserves on the planet.  And as a member of OPEC, their insolvency can squarely be placed at the feet of the government, and not at the 'economic sanctions' placed upon them late in the game by the United States.

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