Daily Brief – Venezuela

Venezuela

For the citizens of Venezuela, the last year has been a tale of ever-increasing economic hardship. Despite deposed President Maduro’s claim that growth has been at 9%, the counter to that is that inflation is estimated at 500%. Exactly a year ago it would have cost 52 Bolivars to buy USD 1. That same purchase today would cost 301 Bolivars. And it does not end there: that is the official exchange rate. The black-market rate is 85% more expensive for Venezuelans at 560 Bolivars. Access to USD at the official rate is limited and so people have turned to crypto and black-market transactions with almost 70% of exchange transactions conducted on the black market. The problem is that food, transport, imported goods, and rent are all set at the black-market rate, but salaries are set at the official rate. The consequent squeeze on peoples’ incomes is severe and untenable. Lastly, due to the sanctions imposed on Venezuela, oil has been exported through unofficial channels at inevitably deeply discounted rates.

EUR/USD 1.1710.

Toyosu Fish Market, Tokyo

The first and traditionally celebratory Toyosu Fish Market, Tokyo auction in the New Year on Monday saw fierce bidding and a new record being set when a 243 KG Bluefin Tuna went under the hammer for 510 million Yen or EUR 2.78 million. That price blew the previous record of 334 million Yen or EUR 1.82 million set in 2019 out of the water. The buyer for both those fish was Kiyoshi Kimura who owns the Sushi Zanmai chain through the Kiyomura Corporation. The fish comes from off the coast of Oma in Northern Japan which is regarded as being the very best area for high grade tuna. In case you are wondering about the decline in stocks of Bluefin Tuna as we were, the official answer is that after conservation efforts the numbers of these fish has steadied and is increasing albeit slowly with such gargantuan catches.

EUR/JPY 183.13.

Venezuela’s Gold Reserves

Apart from the immense Venezuelan oil reserves that are now the topic of much discussion particularly by the USA’s oil companies, Venezuela has 31 tonnes of gold that has been frozen in the vaults of the Bank of England for many years. That gold was valued at USD 1.95 billion in 2020 and assuming it is all still there will now be worth more than USD 4 billion. We say that because Venezuela also had gold reserves frozen in the Central Bank of Spain and then with some Spanish accommodation in 2020, despite a European travel ban, Venezuelan VP Delcy Rodriguez flew to Madrid, talked it over with Spain’s Transport Minister and sold some of that gold departing with USD 68 million in walking around money – allegedly – and gave rise to the scandal being named Delcygate. Home Office Minister Yvette Cooper has made some vague statements on using it as a stick to force a Venezuelan democracy but in the overall scheme of Venezuela’s oil wealth, that USD 4 billion of gold pales into insignificance.

GBP/USD 1.3520.

Bibury, Gloucestershire

Often described as the prettiest village in England, Bibury is currently rocked with dissent on a planning project at the innocent sounding Rosemary Cottage on the aptly named Awkward Hill where apart from building work not being in keeping with the village’s traditional style two palm trees have been planted which are far from in keeping with the more usual ash, oak, beech, and elm of the area. On top of that, the palm trees were swathed in fairy lights over the Christmas period. Whatever next?

EUR/GBP 0.8661.

Another Brick in The Wall (Part 2)

Scraping the barrel for noteworthy pop memorabilia for today we came across this somewhat dubious anniversary: 46 years ago today Pink Floyd released this number in the USA and apart from being a phenomenal commercial success, it turned out to be the only Number One for the group in the USA. Featuring a children’s choir, a disco-influenced bassline and an anthemic quality, this foot stomper became the right on school kids’ go to for 1980.

We don’t need no education
We don’t need no thought control
No dark sarcasm in the classroom
Teacher, leave them kids alone

Hey, teacher, leave them kids alone!
All in all, it’s just another brick in the wall
All in all, you’re just another brick in the wall

We don’t need no education
We don’t need no thought control
No dark sarcasm in the classroom
Teachers, leave them kids alone Hey, teacher! Leave us kids alone!
All in all, you’re just another brick in the wall
All in all, you’re just another brick in the wall

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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