Hugo Chávez is no altruist after all

by Larry Email  242 words

The Venezuelan Government Hugo Chávez announced last Tuesday he had bought 1 billion US dollars in Argentinean bonds (Boden 15) in another big favor he's conceding his good friend and troubled Argentinean president Cristina Fernández de Krichner. Chávez, who always pretends to be an altruist and to act in the interest of everybody else but him and Venezuelans, this time decided he would be no more altruist and is charging a very high 15% interest for the 1 billion loan.

Those are 10 full percentage points above the interest rates the IMF charges for its loans and 8 to 9 percentage points above what a country like Perú has to pay when it has to tap the international credit markets.

Since nobody in his right mind wants to risk his hard earned money buying Argentinian bonds, the road is open for those who can play with the money belonging to others, like Chávez, who buys nearly worthless Argentinian bonds with dollars the Venezuelan guy in the street is forbidden by law to buy.

Anyway the Venezuelan Government will not keep these new bonds for very long. In the near future we will very likely see another offer to the Venezuelan investors to buy these bonds with rapidly depreciating "bolívares fuertes". They will buy them, not because they like them, or want to invest in Argentina, but because it's one of the few legal ways to obtain US dollars bellow the free market exchange rate.

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The Venezuelan LibertarianBoden 15: A trick gone awry
Last week, Hugo Chávez announced he had bought 1 billion dollars worth of Argentinean bonds, a new lot of the so called Boden 15. In my first analysis of the transaction I wanted to focus on the open hypocrisy of Hugo Chávez, who supposedly lends Ven...
08/13/08 @ 08:16:15 -0430 VET
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