[Marxism] Venezuela: The nationalisation of Banco de Venezuela

[Walter Lippmann]

Dollar Drops Against Venezuela's Bolivar In Parallel Market

Tue, Jul 29 2008, 15:07 GMT
http://www.djnewswires.com/eu

CARACAS -(Dow Jones)- The dollar in the Venezuelan parallel market continued
its downward trend against the bolivar Tuesday as the government has been
increasing the supply of greenbacks to prevent a possible increase in the
price of U.S. currency.

Traders said a dollar in the parallel market fetched around VEB3.2, down
from VEB3.25 Monday. This is more than half the price a greenback fetched in
December last year.

The government recently sold more than $220 million in dollar-denominated
structured notes composed of sovereign debt, mostly from Argentina, to
supply the parallel market with U.S. currency.

The Venezuela government pegs the dollar at an official exchange rate of
VEB2.15 and has started to closely monitor the unofficial rate as many
retailers use it as a gauge to set prices. Last year the unofficial rate
more than tripled the peg and was named as one of the factors driving up
prices.

This year, the government has responded by increasing the sale of dollars at
the official rate and simultaneously selling dollar-denominated structured
notes allowing the buyers access to greenbacks at a higher rate than the
official peg.

-By Darcy Crowe, Dow Jones Newswires; (58) 212 905 6304;
darcy.crowe at dowjones.com

July 29, 2008 11:07 ET (15:07 GMT)


DAVID WALTERS asked:

>The very immediate question will be what will happen to Venezuelan 
>currency? Slightly under half of Venezuelan society opposes the Chavez 
>government. Will this mean a mass conversion of Venezuelan currency into 
>US dollars and the flooding out of Caracas to Miami billions of dollars?


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     WALTER LIPPMANN
     Los Angeles, California
     Editor-in-Chief, CubaNews
     http://groups.yahoo.com/group/CubaNews/
     "Cuba - Un Paraíso bajo el bloqueo"
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