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drowsy syrups of the world

Meanwhile in Venezuela….

…Chávez proves he’s a dumbass about economics and plays straight into the hands of the bankers. Once again, the variation on “I’m going to nationalize the banks” comes from Chávez, and once again all the financial community jumps on it hard to stoke up as much panic as possible. I mean, why should it be that the only time people take a Goldman Sachs analyst at face value is when he’s saying something like….

“We should take his (Chavez’s) statements at face value,” Goldman Sachs Group Inc.’s Alberto Ramos said. “It’s one of the key sectors of the economy that the government hasn’t yet taken substantial control of.”

…even though anyone qualified enough to work at the vampire squid knows that Venezuela can’t possibly nationalize its banking system. For one thing, who’s going to buy its debt afterwards?

Now for sure he might like to nationalize the banks, but Chávez isn’t good at economics…we’ve been here before and seen how he’s made these noises and backed off and made the noises and backed off again. This time won’t be much different, as at some point in the next couple of days his financial peeps will quietly explain things to him and then the subject gets dropped…again. But until then, the bankytypes will milk this for all it’s worth. We can see that today, as the bid/ask spread for the Bolivar Fuerte parallel rate moves from 0.2 difference to 0.4.

Thus Chávez, seeking to limit the financial speculation and profit margins of the Venezuelan banks (one of the most profitable banking sectors in the world, by the way) only manages to screw his people and add more % margin to the bankers’ back pockets. He should stick to talking about the misiones, frankly.

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