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Peruvian electricity demand; the canary in the coalmine

One of the main problems I have with Peruvian economic statisticians is the amount of bullshit they feed to the market. Today’s example is from the Ministry of Energy and Mines (MEM) that trumpeted this morning about its +1.7% YoY rise in electricity production in May 2009.

Production? Why should we care about production when the real important figure is the level of demand? So once again your humble correspondent is forced to wade through the headlines (that are picked up by the lazy journalistic world and spewed out to the tell-me-what-I-want-to-hear brigade) and go a huntin’ and a snufflin’ for the truly important numbers. And what do we find? Yes indeedy, electricity demand is flat…0.0% YoY, which follows on from the 0.8% drop in demand in April.

Justify FullThe thing with electricity demand is that you can’t stockpile it so it really shows what’s going on in a country. For sure you can oversupply the market. Pretty simple really; just leave the hydroelectric turbines running overnight on one weekend and you have a +1.7% oversupply. But you can’t hide the fact that industry is running dead flat, so once again we get a bullshit headline trying to paper over a simple truth; Peru isn’t growing and it matters not one jot what FinMin Liar Carranza forecasts or pontificates about his pie-in-the-sky 3.5% GDP growth. By the look of his recent 19% approval rating it seems the general population can smell his BS, too.

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