Venezuelan authorities are set to invalidate the nation's biggest currency bill and citizens are rushing to dump their cash savings or deposit their remaining bank notes. President Nicolas Maduro said that the $100 bolivar note is set to be removed from circulation and he only gave the people just a few days to exchange their bolivar bills.
Maduro says that the continued economic conditions there in the country, are the result of an economic war being waged (not their own failed economic policies, which have only worsened the situation in the past few years) and he wants to try and stop people from being able to smuggle currency out of the country. . . By replacing the worrisome $100 bolivar note with even larger currency denominations.
He also drastically announced that they were going to close the border with Columbia for at least 3 days, so that they could implement these new changes and take those bills out of circulation. Conditions in the country there have worsened in the last few years with many individuals starving and millions leaving their homes for an attempt to gain a better life elsewhere. Even the zoo animals in Venezuela are alleged to have been kidnapped and butchered etc because of the growing starvation in the country, a problem which the government hasn't seemingly done anything to improve.
Maduro has said that after the $100 bills are taken out of circulation, they will be releasing even higher denomination bills so as to help Venezuelan's get control of the fiat currency inflation problem they've been having with their wallets (which have lately been replaced by literal bags of cash). It's estimated that there are at least 6 billion of the 100-bolivar bills in circulation. But why isn't he worried about those bills leaving the country as well? The new plan will involve the introduction of at least 6 new currency notes and 3 new coins, the largest of them will be 20,000 bolivars.
It's Zimbabwe all over again
It's a shame that the people of Venezuela have fools in charge of their economic policies and that they have to drag innocent people along for the experimental ride which we've seen fail again and again. The currency is continually being eroded in value and the Venezuelan authorities aren't yet doing anything significant to alter that self-destructive path for their currency.
Pics:
AFP / via BBC
Shutterstock
Carlos Becerra/Bloomberg
Business Insider
Sources:
http://www.bbc.com/news/world-latin-america-38284485
http://www.dailymail.co.uk/news/article-4024104/Venezuela-demonetizes-largest-bank-note-causing-citizens-queue-hours-cash-machines.html
https://www.bloomberg.com/news/articles/2016-12-12/venezuelans-rush-to-stash-cash-before-biggest-bill-is-nullified
https://www.bloomberg.com/news/articles/2016-11-30/venezuelan-inflation-hits-currency-with-arrival-of-bigger-bills