Why are Venezuela’s supermarkets so empty?

Venezuela’s supermarkets don’t have enough food. Or toilet paper. Or, well, anything really. And that’s why the government is about to startfingerprinting people to ration goods.

But why can’t an oil-rich country even keep its stores stocked? Well, it’s the price controls, stupid. They always and everywhere create shortages. Here’s why they have done so in Venezuela.

1. The government is running a massive deficit, around 14 percent of GDP, that it’s financing with the printing press. The problem, of course, is that money is worth less when you create more of it to pay your bills. So it’s not surprising that Venezuela’s inflation is officially 60 percent, and might actually be as high as 300 percent.

2. But the government thinks it can wish away this inflation with currency and price controls. Here’s how they work (or don’t). There’s an official exchange rate of 6.3 bolivares per U.S. dollar that only the government and its cronies have access to. Then there’s a second tier for the slightly less connected at 10 bolivares per dollar. A third one at 50 bolivares per dollar for those even more on the outside. And finally, there’s the black market exchange rate—emphasis on the word “market”—that tells us it should really be something like 68 bolivares per dollar. In other words, political insiders can get dollars for ten times cheaper than almost everybody else.

Venezuela strictly controls prices, too. Everything from milk to sugar to, yes, toilet paper has an official price that stores aren’t supposed to change. Of course, sometimes they do. But the Maduro regime has promised toinspect them even more closely to put an end to these market prices.

3. Now, anytime you try to suspend the law of supply and demand like this, you’ll get shortages. Venezuela imports most of its basic goods, so it’s only profitable to sell them at the official prices if you can buy them overseas with dollars you got at the official exchange rate. Businesses that have to pay 60 bolivares for one dollar aren’t going to spend it on things the government will only let them sell for, say, 20 bolivares. They’ll leave their shelves empty instead.

But it’s even more perverse than that. The companies that are lucky (or corrupt) enough to get cheap dollars don’t always use them on what they’re supposed to. That’s because they can make more money selling their subsidized dollars in the black currency market than they can make selling their subsidized goods at the official prices. So they’ll fake invoices that show them importing what they said they would, and then flip some dollars for a quick profit—or maybe hoard them for a bigger profit later. That’s why, as Francisco Toro puts it, Venezuela’s “‘butter importers’ are no such thing” but are rather “currency arbitrageurs, with a loss-making side-business in butter imports.”

In other words, it’s not profitable for the unsubsidized companies to stock their shelves, and not profitable enough for the subsidized ones to do so, either. So the stores stay empty.

***

It’s a reminder that you can’t suspend the laws of economics. You can’t print money to pay for things without creating inflation. And you can’t stop that inflation just by saying you want it to. But not only will this magical thinking fail, it will also create new and even worse problems like shortages.

Capitalism is the worst economic system except for all the others.

blue-voids:

Guy Sargent - What Lies Beneath the Surface, 2006-09

thisshitfunny:

thatdudeemu:

queerasfuck88:

Jon Stewart Goes After Fox in Powerful Ferguson Monologue

I been waiting for the daily show to come back so they could cover this

Jon rip them boys a new asshole 

18mr:

“When thinking of iconic romance, ask yourself if any imagery (paintings, photographs, film-stills) comes to mind that is not showing heterosexual couples? Probably not,” says photographer Braden Summers of his photo series of everyday gay and lesbian couples from around the globe.

[x]

orange-takanoichigo:

"Thank you to read Orange Volume 3!" [x]

orange-takanoichigo:

"Thank you to read Orange Volume 3!" [x]

Chris Evans has been known to grab people’s left boob, so my question for both of you is have you ever had your left boob grabbed by Chris Evans? (x)
The Google Doodle to mark the 200th birthday of Gothic horror writer Sheridan Le Fanu.

The Google Doodle to mark the 200th birthday of Gothic horror writer Sheridan Le Fanu.

urulokid:

urulokid:

poutineisdelicious:

xekstrin:

majere636:

arachnofiend:

marapetsrules:

bobfoxsky:

“You fool. No man can kill me.”

How many times am I allowed to reblog this before it gets weird?

image

Fun facts: Tolkien constructed this scene because he came out of Macbeth thinking that Shakespeare had missed a golden opportunity with the ”Be bloody, bold, and resolute; laugh to scorn the power of man, for none of woman born shall harm Macbeth” prophecy

Being letdown by Macbeth is apparently a significant factor in Tolkien’s writing because the Ent/Huorn attack on Isengard was the result of his disappointment that the whole “til Birnam Wood come to Dunsinane” thing was just some dudes holding sticks and not actual ambulatory trees.

so he basically took his favorite shakespeare headcanons and put them into his AU fic

This revelation just knocked me over.

LET ME TELL YOU A THING ABOUT JOHN RONALD REUEL TOLKIEN. BACK THE FUCK UP SIT THE FUCK DOWN YOU KNOW NOTHING ABOUT ANYTHING YOU’RE FUCKING JON SNOW HERE. LET ME TELL U A THING

JONNY T WAS LITERALLY THE BIGGEST FANBOY TO EVER WALK THE EARTH. LITERALLY THIS FUCKIN NERD WENT INTO WORLD WAR ONE AND WROTE NORSEFIC EDDA FANFIC IN THE TRENCHES AND SENT IT TO ALL HIS FRIENDS WHO WERE PRESUMABLY LIKE “JOHN WHAT THE FUCK”

BUT IT DOESN’T END THERE

HIS WIFE? MADE HER AND HIMSELF INTO SELF-INSERT OCS IN SAID FIC. ALSO MADE HIMSELF A TOTAL TYR SELF INSERT CHARACTER. ALL VERY DRAMATIC. KEPT WRITING THIS FIC UNTIL IT WAS HUGE. AFTER HE DIED HIS SON PUBLISHED IT AND CALLED IT THE SILMARILLION. JRR YOU FUCKIN NERD

WAIT I’M NOT FUCKING DONE YET. TREEBEARD? BASED THE WAY HE TALKED OF HIS OLD FRIEND JACK WHO YOU ALL MIGHT KNOW AS CS LEWIS. THAT’S RIGHT. THAT NARNIA MOTHERFUCKER. WROTE HIM INTO LORD OF THE RINGS AKA THE SEQUEL TO THE SEQUEL OF HIS ORIGINAL FANFIC MASTERPIECE. CS LEWIS FUCKING HATED LORD OF THE RINGS. TOLKIEN FUCKING HATED NARNIA. BASICALLY THEY STARTED THE OXFORD PROFESSOR LIVEJOURNAL CLUB AND THEY FLAMED EACH OTHER’S SHIT RELENTLESSLY YET REMAINED BFFS

SHELOB? FUCKING TARANTULA BIT J-TIDDY ON THE FOOT WHEN HE WAS LIKE 3. WROTE IT INTO LORD OF THE RINGS.

HIS AUNT’S HOUSE? NAMED BAG END. YEAH YOU GUESSED IT WROTE IT INTO LORD OF THE RINGS

THIS FUCKING DORKUS SUPREME MADE UP HIS OWN LANGUAGE. WAIT NO IM WRONG. HE MADE UP LIKE 80 LANGUAGES AND DIALECTS AND ALPHABETS AND SHIT 

BEST PART OF ALL?? HIS OWN LAST NAME, TOLKIEN, WAS DERIVED FROM THE GERMAN “TOLKHUN” MEANING “FOOLHARDY”. DOES THAT RING A BELL TO ANYONE FAMILIAR TO LORD OF THE RINGS??? BECAUSE YOU SHOULD KNOW THAT PEREGRIN “PIPPIN” TOOK’S LIKE FUCKING CATCHPHRASE WAS “FOOL OF A TOOK”. TOLKIEN FIC’D HIS OWN FAMILIAL LINGUISTIC HISTORY INTO HIS WORK WHAT A DWEEB

IN 2008 HE RANKED 6TH ON A LIST OF THE TOP 50 BRITISH WRITERS SINCE 1945. HE WAS A PROFESSOR OF LANGUAGES AND OTHER IMPORTANT STUFFY SHIT AT OXFORD

AND JRR TOLKIEN WAS THE BIGGEST DWEEB EVER TO LIVE

THE END

This Is A Low
Blur

champagne-supersonic:

And into the sea
Goes pretty England and me”

Hey tumblr people, does any of you know someone that is in some sort of project against violence/ chats about consent and stuff like that? I would like to get in contact with some people to see if I can maybe start a campaign, or help campaigns already existing in my country. If so, please leave me a message or something to get in contact, please.

starsoohyun:

Ziozia 2014 Fall Ad Campaign

asylum-art:

Pejac: New Street Pieces - Paris, France

on Facebook

Pejac recently spent some time in Paris, France where he worked his way through a couple of new street pieces including the above piece which is entitled “Ants”.
With his minimalist but clear style, he painted 2 silhouettes of kids being cruel with magnifying glass on what looks like colony of ants. But, instead of burning ants which is always an interesting game to play, these kids are burning little humans. The artist used the texture of raw concrete wall, and painted these little men to look as a realistic colony of ants. Juxtaposed with flat silhouettes of children, the tiny creatures shown with their shadows and in perspective, look very fragile and harmless. The Spanish artist also painted two extra pieces including a surrealistic and amazing door.
Check out more photos of the new pieces after the jump and come back soon for more mural updates from Pejac. This piece can be seen in person @ Avenue de 8 Mai 1945, Vitry-sur-Seine, Paris.

Natalie Dormer attends the 66th Annual Primetime Emmy Awards (2014) x