{"href":"http://player.captivate.fm/services/oembed?url=http%3A%2F%2Fplayer.captivate.fm%2Fepisode%2F72435331-45c0-4cb5-b1c4-139a03f55159","version":"1.0","provider_name":"Captivate.FM","provider_url":"https://www.captivate.fm","width":600,"height":200,"type":"rich","html":"","title":"Episode 186 \u2013 Venezuela, Davos and claims of racism","description":"
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\nThe Velvet Glove and The 12th Man will be in Melbourne on the 9th and 10th of February. The boys would love to catch up with listeners on Sunday morning for breakfast. Email trevor@ironfistvelvetglove.com.au and we will let you know the details.
\n4:52 A Podcast Prayer
\nLet us pray.
\n6:00 Feedback on episode 185 from Brett and Bronwyn
\n7:45 Australia backs Juan Guaido as interim Venezuela president
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\nAustralia’s Foreign Affairs Minister Marise Payne said Mr Guaido, the opposition leader and president of the National Assembly, ought to lead the Latin American nation until elections are held.
\n“Australia calls for a transition to democracy in Venezuela as soon as possible,” Senator Payne said on Monday.
\n“We now urge all parties to work constructively towards a peaceful resolution of the situation, including a return to democracy, respect for the rule of law and upholding of human rights of the Venezuelan people.”
\nHmmm, political turmoil, a hostile congress, public servants who have no money and need to stand in food lines for hand outs?
\nQuestions over the legitimacy of the election where only 46% voted?
\nIt all sounds like the USA except bump the voter turnout figure up to 55%
\nIn other words, the USA is in crisis and we recognise Nancy Pelosi as the true President and call on Donald Trump to bring on an immediate election.
\nAccording to Francisco Rodriguez:
\nWhen an economy\u2019s exports fall, that economy\u2019s imports won\u2019t necessarily decline immediately if the economy can borrow or dip into its savings in order to cushion the blow.\u00a0 That is why countries subject to high terms of trade volatility are well advised to save during boom times.\u00a0 And that is precisely what Venezuela didn\u2019t do.
\nOn this, the blame falls squarely to the government of Hugo Ch\u00e1vez, who led the economy during the largest external boom in its history and basically spent all of it. As a result of (*corruption and) Ch\u00e1vez\u2019s willingness to pour money into everything \u2013 from paying off nationalizations to buying the support of Caribbean countries with cheap oil \u2013\u00a0 Venezuela ended up in a much more vulnerable position than just about any other oil exporting country when the shock hit.
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\n* inserted by The Iron Fist, not the original author
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\nWere the country selling as many barrels to the rest of the world today as in 2015, it would have exported $51bn in oil this year. By contrast, Venezuela will sell only $23bn of oil internationally in 2018.
\nThe bottom line is that if you want to understand Venezuela\u2019s economic implosion, you have to understand what happened to its oil exports.
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\nFor the purposes of comparison, Chart 2 plots the evolution of Colombian oil production during the same period.\u00a0 Venezuela\u2019s neighbor also produces high-cost oil; after the bottom fell out from under oil prices, some of those barrels were no longer profitable to produce.\u00a0 As the figure shows, the decline in Colombia\u2019s oil production during this period of time was quite similar in magnitude to that of Venezuela.\u00a0 This suggests that the initial stage of the production decline was in line with what can be explained based on the fall in profitability caused by the price collapse in a high-cost producer
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