Behind the Scenes in a Hummer

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Ten days or so ago, devoted reader/Excel nerd El Cachaco had some extra time on his hands and decided to spend it figuring out exactly how much official price gasoline you can buy in Venezuela with a single $100 bill.

The answer is: an insane amount. When he first did the calculation, a $100 would buy you Bs.22,000, and since a liter of gas costs just Bs.0.097 bs, that worked out to 228,865 liters…enough to drive a Hummer around the circumference of the earth 24 times!

I thought that was a fun detail, and wanted to include it in the OpEd Dorothy and I were writing for the New York Times.

Problem is, by the time we got the edit back from our editor in New York, the Bs. had fallen to Bs.255:$1, and that same $100 was sending our Hummer around the world 27 times. We sent in a correction, and by the time the copy edit came back, it was already out of date: the bolivar was down again, enough to buy our hummer one more go around the world!

That’s the version they wound up printing. By the time we tried to correct it again, to reflect the further slide to Bs.281:$1, that $100 was buying 289,690 liters of gas, enough to go around the world in a Hummer 30 times, the paper had closed.

The bolivar is falling so fast, our OpEd went out of date by two whole go-arounds-the-world literally in the time it took to print the newspaper.

71 COMMENTS

  1. A friend, now deceased, went to Medical School in 1920s Germany. Her parents gave her a year’s tuition, and put her on the overnight train to Frankfurt. When she arrived, the tuition money had lost so much value that it was just enough to purchase a stamp to send a letter to her parents, asking them for tuition money. Its value had fallen by a factor of one thousand, overnight.

    Soon people in Venezuela will be looking, not just for diapers or powdered milk, but anything that will keep its value, be it bricks or chairs, electrical fixtures or rugs. Anything except bolivars.

  2. As part of our get out of Dodge plans we were thinking of selling our 2008 Toyota Corolla back in December. At that time we were offered $ 6,000 and I said no as we still needed it for a bit longer. Last week we were offered $ 8,000 and now it has appreciated again and I hope to get that or a bit more by the end of March when we bugger out of here for good.

    Where else in the world does a depreciating asset appreciate in value?

    • Glad to hear you have a “get out of Dodge plan”. Did so myself early last year as the current disaster seemed imminent. Hated to sell my house but no other option given the current situation there.I also sold my car for more than I paid for it 6 years earlier. Only in Venezuela!!

  3. Well done! It was so appropriate that you used the Hummer as an example. Hugo Chavez HATED the Hummer! It was rumored that he nearly got into a fight with a family relative who happened to have purchased a Hummer. Funny stuff.

  4. You lead yourselves by your own noses into further confusion by spending all your time writing about the price of goods in Bolivars. If you were to spend all your time writing about the price of goods staying the same over time in US Dollars, you may get to the solution sooner – given enough time.

    • But gas in Venezuela is only sold in VEF.

      And, it’s fun to read that from you of all people, (after all you oppose dollarization and propose a daily inflation index, to adjust prices, salaries, etc every day in the national currency)

  5. brilliant, FT… but I have to say, your frequently used “$20 bills sold for $1” analogy has officially grown old: with the USD now nearing BsF 300 on the street, the government has moved on to selling $50 for a buck.

  6. One crazy thing about gas prices, is that even if you take the magical 6.30 rate, with 100 bucks you can still go twice around the Earth in a Toyota Corolla.

    Even if you were stupid enough to trade one dollar for one bolivar, you would still make around 700% profit by reselling in Colombia.

  7. The average for a new Vehicle Fuel Economy in the U.S (year 2014) is at 24.1 Miles Per Gallon. Source : EPA. Hence, applying the conversion rate of

    1 gallon = 3.79 liters of gas
    3.79 liters will get you 24.1 miles
    1 liter will get you : 6.36 miles.
    Meaning:
    Bs.0.097 will get you : 6.36 miles.

    At “DolarToday” exchange info on March 2015 at 13:00, the different exchanges (yes, we have 5 exchanges) will get you:

    1) CENCOEX Bs6,30= 64.95 liters= 1US$

    2) SICAD 2 Bs12.00= 123.71 liters= 1US$

    3) SIMADI Bs177.64= 1,831.34 liters= 1US$

    4) IMPLICITO Bs87.52= 902.26 liters= 1US$

    5) DolarToday= 281.05= 2,897 liters= 1US$

    * Meaning at DolarToday conversion rate you need 1US$ to buy 2,897 liters that will allow you to travel 18,424 miles at the fuel efficiency average of U.S cars.

    * Since a typical medium car in the U.S has a 16 gallon tank size capacity, meaning 60.64 liters tank and since the average cost per gallons in the (U.S) as of today is $ 2.458 (source AAA) ; this means 1 US$ can fill up 47.77 cars in the U.S

    * to fill up just one car in the U.S will cost you 0.02 cents. at Bs per liter cost in Venezuela using DolarToday conversion rate.

  8. Venezuelan’s should feel truly blessed, licensed to pollute with nary a thought. Don’t let ’em invisible bonds of free-market slavery social-bond commoditizin’ hold you back, no siree. Light up a camel, fire up your malibu and take a whiff of the leaded gasoline. Nothing smells like it in the morning. The smell of … victory.

  9. And the fools still scream Viva Chavez while they stand in line for 6 hours to buy milk and they believe the government baloney about who caused it! They still apparently believe that the feckless idiots running the government will provide for them and that one day it will all be solved if they just throw enough people in jail and the socialist paradise will blossom.

    • And yet you still want to be taken seriously with tantrums like this?

      Keep digging, you’re going down faster than a Zergling.

      Also, do you know about the date the wax doll kicked the bucket? Because that’s got to be another huge embarrassment even for his family, who happily jumped into the bullshit express.

  10. You know you’ve written a good, scathing piece when the neighborhood troll can’t even come up with a half-assed rebuttal and thus resorts to childish taunts.
    Chapeau, Quico.

    • agree. dspur’s getting more and more desperate to deflect from the ugly realities of having drunk the kool-aid of a pretty revolution gone to seed. We should set up a troll barometer.

      • He’s going pretty high now, his latest pearls include chaburro classics like “11 de abril” and “you’re a fag”.

        Poor guy, the communicational guerrilla has pretty low standards to hire people these days, I’m imagining how the work interview would go:

        – “Do you love the supreme colonoscopic commander?”
        – “Yes! With the strength of a thousand burning suns!” *puffs chest like a pigeon about to explode*
        – “Good, good, we can’t use any of those baby-eating faceless monsters here, now, can you think in quick answers for anything those fags might want to say?”
        – “Course I can, comrade! I’m very vivo!”
        – “Great, give me some examples when those worms dare to open their butts and even think to say anything.”
        – “Easy! Just screech ‘FAG!’ and ‘APRIL 11!’ as loud as I can!”
        – “Welcome aboard, comrade! We’ll be sending you the paycheck from next week onward!”

  11. I am sorry. The giving away gas is no laughing matter… it amounts to an economic crime against humanity.

    Over more than a decade I have published perhaps 100 articles, mainly in El Universal, against the giving away gas crime, only to receive stupid and insulting comments most of them phrased as why should we give the government more?

    Worse than the absurdity of how many times you could travel around the earth with a Hummer, is the absurdity of how a society and specially its elite, can remain silent about such absurdity.

    Honestly… who is really to blame? Maduro? Come on!

    http://petropolitan.blogspot.com/2002/10/el-precio.html

    • “I am sorry. The giving away gas is no laughing matter… it amounts to an economic crime against humanity. ”

      But you’re crying like journalists are taught to do, Per.

      Please look at the campaign of HCR and VP regarding the reduction of the subsidies including gas. What opposition leaders have a sensible position, according to what you’ve said?

      • “But you’re crying like journalists are taught to do, Per.”
        First, I am no journalist… but even if, what on earth is that of being “taught to cry” suppose to mean?

        • Let’s cut the bull, OK, Per? Allow yourself a moment of honesty.

          PJ and VP are the ones now playing the populist card. They know the government needs to cut costs.

          So, you either consciously downplay the importance of your political movement and their ability to capitalize on the resulting social unrest, or your completely ignorant of the Venezuelan political discourse.

          • Wow, the manipulator hiding behind a mask and repeatedly derailing discussions on particular topics, now demands honesty?

            Loco ‘e bola.

          • “Now so to also help you understand the current opposition groups that are against Chavez, let me inform you that they do not mention this issue either. Are you clearer yet?”

            http://perkurowski.blogspot.com/2006/07/so-you-might-all-understand-chavez.html

            Mr. dspur I have been very clear from the very start criticizing the silence of the opposition, and I owe my opinions to no one but myself, and so I have no intention of furthering a conversation with some unknown besserwisser who wants me to “cut the bull” bye bye

          • And your 10 year-old pat of the hand amounts to what, Per? You’re so concerned with diplomacy among yourselves, opposition-journos, you can’t do shit.

            Call El Universal right now and explain the problem:

            “VP and PJ are populist pieces of shit. We should not support them because they are deceiving us. The population won’t improve if we allow politicians that use the media to MISEDUCATE for their profit.”

            Instead of that, Per, we get lies from you, too:

            “Mr. dspur I have been very clear from the very start criticizing the silence of the opposition”

            Oh, but the have been anything but silent, Per. HCR is calling the gas rise a “paquetazo”.

            You can’t do shit because your job is at hand, Per.

          • Nice straw man, Per.

            You totally sidestepped the cognitive dissonance between your sensible request and what politickers are actually doing.

            Pick your venue, man. You can go for EL Nacional, maduradas.com, La Patilla…

            Maybe Caracas Chronicles is interested?

    • The only ones that are truly getting benefits from free gasoline are the smuggling mafias that threatened all the governments since the 90s to keep its prices frozen.

      The car-owning population didn’t complain because giving free stuff to people in a shitty economy is a means to control said population.

      The problem now is that the same free gasoline idiocy has extended to every basic need product in the market, that’s one of the causes of the infuriating scarcity which results in the massive buhonero fiasco and the degrading lines.

    • Not only is it an economic crime, it’s also a huge environmental crime. The last section of the excel sheet shows the CO2 emissions for a given amount of gas you purchase, and how much that carbon would be taxed in British Columbia and Quebec.

      • “Not only is it an economic crime, it’s also a huge environmental crime.”

        Gusanera Economists vs Gusanera Politicians

        “Quieren aumentar la gasolina para tapar el hueco fiscal derivado de la caída de los precios del petróleo, quieren una vez más sacar la plata que necesitan del bolsillo del pueblo. Ellos creen que todavía vivimos en un mundo paralelo, navegando sobre el precio del petróleo del año pasado, cuando ya va por 40 dólares y el presupuesto de la nación para este año fue calculado a 60 dólares.”

        -HCR

        http://www.elpropio.com/actualidad/opina-Capriles-aumento-gasolina_0_673732683.html

  12. People who run industrial facilities have a rule which experience has proven right again and again , the more you pospone a necessary repair or maintenance the more expensive it becomes , not just because of inlfation but because the wear and tear of each year compounds in time with the defects of the following years causing a cummulative effect that makes the repair increasingly more difficult and costly.

    The Caracazo by making the price of gasoline socially and politically untouchable has damaged Venezuela much more than the actual damage caused by the rioting . Gasoline prices should have gone up years and years ago . Problem is that because governments are fearful of losing power if they adopt responsible measures they pospone them or take much less effective ones to avoid the electoral punishment that such measures entails.

    Kennedy is once again proven right , the greatest political virtue is courage , not the faux courage of making wild violent and aggresive gestures to show ones ability to inmitte an angry gorilla. but the courage to take responsible measures that benefit the country long term even if they have a political cost. !!

    Maduros greatest fault is his cowardice , his paralysing fear that taking responsible measures will hurt his political image , he compensates for his cowardice by making frenzied and wild gestures against d, local dissident groups and local businesses , and other who dont have the means of retaliating his insults and abuses .!! Its the drunkards courage that has him show his courage by beating up his children and wife !!

    Maybe electoral democratic politics makes cowards of all pols,!!

    • Actually is populism what ruins everything by leading every decision maker to take only the choices that would make their image go up in the polls.

  13. “Maybe electoral democratic politics makes cowards of all pols,!!”

    This sad state of affairs is not the politicians’ fault. The populace at large (in all countries) will not vote for a candidate that prescribes harsh medicine and predicts hard times. They will vote for those who promise blue skies, even when the dark clouds of stormy weather are rolling in. When the storm finally hits, however, the delusion cannot be sustained, and there is a chance the people will elect someone espousing realpolitiks in the hope of salvation. Venezuela is now at that cusp where a bold man might rise to savior by plain truthful talk. On the other hand, such a man might be buried in vilification by a multitude still grasping lifelines of delusion tied to a sinking ship. Tough decision for a politician.

  14. Alter Ralph : Nicely put and reflects reality to a T, But there is a deeper message in what you say: Responsible and effective govt finds in democracy an obstacle because pols need to get elected and to do that they have to lie and cheat and delude people with promises they cant keep . Is there any way in which democracy can be made into something that rewards rather than punishes responsible govt ??

    Fukuyama has studied the history of responsibe and effective governance and he proposes that democracy is born corrupt ( Andrew Jackson and his sponsorchip of partisan patronage and cronyism ) and tends to remain so unless you have pols live through a difficult time that forces them to see the benefits of reponsible govt even to them ( in the US The Pendleton act was the pivoting moment) .

    How do we go through doing the same in Venezuela ?? Can people idiotized by lack of educational opportunities, sectarian passsions and corrupted by decades of patronage and cronyism scape the trap of their own inabilty to judge what sort of govt.is best for them ??

    • “How do we go through doing the same in Venezuela ?? Can people idiotized by lack of educational opportunities, sectarian passsions and corrupted by decades of patronage and cronyism scape the trap of their own inabilty to judge what sort of govt.is best for them ??

      That sort of belittling question is, ironically, part of the problem that lead nationalist movements to surface. This is why la gusanera isn’t taken seriously and never will be. You’re too busy being USA’s bitch.

    • “Can people idiotized by lack of educational opportunities, sectarian passsions and corrupted by decades of patronage and cronyism scape the trap of their own inabilty to judge what sort of govt.is best for them ??”

      Questions regarding the efficacy of democracy has been around since its inception in Greek society. Socrates concluded democracy was little more than mob rule and could not be successful, a conclusion that contributed to his demise by Hemlock. It is clear to me that democracy will not result in a meritocracy, and its tendency will always be toward corruption and inefficiency. The one particular hope I have is the fourth estate. One of the underlying principals of a functioning democracy (and also Dieterich’s 21st century socialism) is an informed populace. In my opinion, a free press is the main bulwark against mass manipulate and rule by oligarchs under the guise of democracy. The advent of the internet makes control of information much more difficult for autocratic regimes and makes grass roots organizing easier. Rapid dissemination of information to a mass audience is a powerful tool against manipulation and corruption and works in favor of informed decision making. In time, the internet will bring profound societal changes, hopefully for the better. In the short run (your point), the demagoguery and dissembling of the current government is fully exposed and is acknowledged by 80 percent of the populace. Give the people some hope that there is another way out of their material degradation and they may set upon a new course. The people already are informed about the bankruptcy of the current system. As for creating an educated and well-informed population motivated to be discerning decision makers, well, that’s a task for future generations. They will have tools and circumstances unknown to us, and things will change in ways we cannot imagine.

      • I like your optimism , but regretably Im not at all convinced that people whose mind and character have been crippled for a long time with the deepest superstitions and ignorance and corrupt habits can go very far in understanding the complex economic issues that govern their fate . they know something is wrong but they dont find it easy to know exactly how their misfortunes have come about nor what has to be done to scape them , they will believe what is easiest to understand , they will tend to gravitate toward the most primitive and melodramatic explanation offered to them and to sympathise with the notion that some quick fix magic scheme exists to get them out of their predicament, one which involves no pain for them . The problem is not solved by giving people information , they have to be given the intellectual tools and discipline to interpret that information the most analytical and critical way , and that requires certain habits of thought and reflexion that dont usualy come by naturally . Of course the spread of cyber literacy and communications are bound to help. but I fear that much more is needed , at least in the case of our countrymen. This is a subject that Im certain we will visit again. Thank you for your thoughts which well appreciated.

  15. In his autobiography titled “The Invisible Writing”, Arthur Koestler (1905-1983) wrote:

    “I automatically learned to classify all that is repugnant as an »inheritance from the past», and all that is attractive as the »seed of the future». With the aid of this automatic classification it was still possible for a European in 1932 to visit Russia and continue to be a communist.”

    Clearly that is valid for some in Venezuela year 2015 too.

    • Per : The ancients had it the other way around , the past was always the best , and it was the Enlightment which made the notion that progress was inevitable an universal belief. Human capacity to entertain the illusion that some perfect time lay in the distant or remotest past or is to be found in some indefinite future is one which few people can scape from . I am very skeptical of peoples capacity to predict what the future will be like , there are too many variables , to many uncertainties and happenstance events that can turn fate on a dime . One thing I do believe is that we are born with the vocation to try to attempt to improve things (even if we are wrong about the best way to do so) whatever the results of our efforts .

      Its like a enticing puzzle , here is a problem , can we through our imagination concieve a way to solve it or at least to make it less discomfiting ??. Few men of imagination can turn their back on this challenge whatever the odds of finding a solution.!!

      • Most human cultures include myths a “Golden Age”. It is only when we shed superstition and mysticism that we see these myths for what they are. Not quite there yet… ‘Work in progress”.

  16. The Cuban regime in its efforts to present a fachade of seriousness that might allow them to attract the capitalist investments they so desperately need to avoid a colapse of their economy now that Venezuela wont be able to susbsidize their bankrupt finances has published a report that shows that their main source of foreign income comes from the remittances which US Cubans send to their impovereshed familias on the island ( USD 3 billion) and from the oil deals that the Venezuelan govt allows them to make (900 md) with other countries. It is ironic that this parasite regime which in 60 years has never been able to sustain itslf economically and which has all this time been dependents on the hands out from the former Soviet Union and from Chavez Venezuela call the people the fellow countrymen in the US who help them survive ‘maggots’ ,prcisely the term that best describes their own parasitic existence. !!!

    • It is ironic that this parasite regime which in 60 years has never been able to sustain itself economically and which has all this time been dependents on the hands out from the former Soviet Union and from Chavez Venezuela call the people the fellow countrymen in the US who help them survive ‘maggots’ , precisely the term that best describes their own parasitic existence. !!!

      Or, the best defense is a good offense. Propaganda-wise,it has worked for the Castro bros.

  17. Does anyone know a good internet site for daily monitoring of the Venezualan black market for VEF/USD? A local Russian businessmen got paid in bolivars for his exports to Venezuala (we are talking millions of bolivars) and now wants to exchange this sum of money to dollars or roubles. However, we need to know the black market exchange rate in real time, so that the deal is fair. We want to make the currency deal in Moscow, but tie it to the Venezualan black market rate.

    • There are several, one of them is dolar today, who show the prices that are used by black market at Cúcuta and other towns at the Venezuela / Colombia frontier zone.

      • Thanks. That site is very informative. So the bolivar strengthened back to 240, after being near 280 a couple of days ago? This is an interesting development.

  18. If I’m understanding this correctly, you are using the official rate, not black market rates. It appears that $1 is worth about 1,000 Bolivars on the black market, so at .097 Bolivars per liter, we would be able to buy 100,000 liters of gasoline, or 26,415 gallons for US$ 1.

    I know this is nothing new, even before Chavez. In the late 90s I remember the owner of a 120 foot diesel yacht bragging about picking up 10,000 gallons of diesel, enough for him to travel for an entire year, for $1,000. A huge subsidy for someone who definitely did not need it, but was happy to pick it up when offered! And now fuel is far, far, far cheaper than that. I wonder how many yacht owners are lining up … although I suppose they fear for their lives nowadays :(.

    Is gasoline still readily available at these prices? I would think it would be long gone …

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