It is painful to read about the dire problems in Venezuela. A cup of coffee now cost 75,000 bolivars up from 1,800 bolivars, that rise took just over a year. That’s an increase of 4,067%.
This is a textbook example of what happens when your government loses control over their economy. It can happen in many ways, one way is by printing money at will. I expect that soon the American dollar will go the route of the bolivar.
Bremmer Rodrigues owns a bakery just outside of Caracas, he says that he doesn’t know how to get rid of the bags of bills that is collected at his shop. Every day he takes in hundreds of thousands of bolivars. He hides the bills in boxes so he can get them to the bank to deposit.
The bolivar is so devalued that $5 is equivalent to a brick load of bills. ATMs need to refilled hourly due to the amount of bills needed to be dispensed just for a small amount of cash. Merchants no longer count money when a transaction is made, they weigh the money. Basic purchases take hundreds of bills, shoppers stuff piles of bills into gym bags when shopping and storekeeper stash thousands of bills into box and drawers.
Whatsapp reports that the price for a kilogram of ham costs 1,480,000 bolivars. At one deli, they stopped ordering ham when their scales can’t calculate the cost. Their scales only have six digits and they ran into problems when they tried to fix the scale so it could calculate the price. A kilogram is approximately 2 pounds.