Conatel Breaks 4,832,000 Eggs to Make One-Egg Omelette

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dtlogoAfter a long battle, the central government can finally say they took down the real mastermind behind the evil “parallel dolar”: DolarToday’s mobile app.

Sure, it couldn’t be done without breaking the Venezuelan internet by blocking all content hosted by Amazon’s S3 cloud service, one of the world’s largest, which hosts literally trillions of pieces of content and relied on by every major site from Dropbox and Reddit to Minecraft, Tumblr, Formspring, Pinterest and Swiftype.

Then again, it’s not like stuff like this has happened before, RIGHT?

Kudos to the Guardian of the Revolution who made it possible: CONATEL’s Director-General William Castillo, who’s so concerned of losing his Twitter account, he’s taken to musing censorsing the web if he didn’t get it back.

1 COMMENT

  1. Big deal… Just look for them on twitter.

    BTW I’m certain that the people behind DolarToday has to do business from the arbitrage they control. Is basically the only source us mortals have to know the price of foreign currencies. Lack of sources is never healthy in economics.

    • I agree. What happens in an small informal market used by smugglers and drug traffickers in a small border town is not representative of the actual supply and demand in the whole country. But, it is an indicator, and it’s what we have to work with, until someone creates a real market… waiting…

      • A real market depends on supply-demand, and, however you structure a market today, given the socio-political-economic circumstances, there will be very little supply, and very heavy demand. Also, historically, in normal country situations, the black market rate was often 150% of the Govt-controlled rate, which, if one were to take the Simadi 180+ rate, would be 270+. But, Venezuela is far from a normal country situation. Obviously, given current total M1, and with an IMF low-interest $20 bill. loan, assuming $ debt restructuring and compliance with IMF other financial requirements, a unified rate currently of 70-80 with no black market could probably be feasible, though it would probably slip higher in time as M1 would necessarily have to expand to keep subsidizing the vast numbers of poor from suffering too much from the large inflationary economic hit.

  2. As of right now, Dolar Today is working… in Venezuela.

    So, even by temporarily breaking the internet, they didn’t succeed.

  3. BTW, after last week panic attack, the black market rate fell a lot. Now is climbing up again.

    This rollercoaster has to be hell on people that actually depend on it to keep the business going.

    • Last year at this time the parallel rate also fell briefly as some local businesses changed $ to pay for Bs. income taxes due mar.31, latest.

    • My personal theory is that the dip was caused by a temporary demand for Bolivares because several large retail outlets in Venezuela recently reduced their prices on durable goods and sold off a large portion of their inventories. I will leave it up to others to speculate as to why they would sell off inventories at prices that are probably a loss.

  4. It is impossible to block knowledge of the parallel rate in any hyperinflationary market, with emphasis on the word “market”. As long as there are buyers and sellers, there will be a price (the parallel rate) that will be passed around by all means possible.

    In Luanda, Angola during 1994-1997 I got the current daily rate on my mobile hand-held radio as I was driving to work. The person that informed me got it from the main market in Luanda every morning. As our clients came in during the day to buy spare parts or make payments on debts, we used that current rate. We updated all our prices every time the rate changed. All our spare parts and services were priced in US Dollars. We simply applied the new rate every time it changed. The USD prices never changed. Hyperinflation was no problem to us since we could update all our prices every time the rate changed, i.e., at least once a day. Sometimes even twice a day. Our workers´ relatives and friends would inform them by phone or radio or word of mouth when the rate changed during the day. They informed me. Everyone in the street markets and shops knew the rate all the time and when it changed it was quickly spread around.

    The rate was the most important piece of information in the country for everyone every day – all the time. Everyone knew the latest rate and made a point of checking in the main market what the current rate was.

    It is impossible to hide the rate.

    • In Allende’s Chile toward the end, cab drivers at the airport would pick you up, quote a price in local currency subject to change with the changing dollar rate, then, when arriving at your destination in Santiago, would up the local currency price to coincide with the increase in the dollar local currency value during the ride.

        • Good. It only stabilizes the entire economy when the entire economy does that – with every change in the general price level – which is the parallel rate during hyperinflation. Brazil did that for 30 years from 1964 till 1994 with finally their Unidade de Valor Real which changed daily. Unfortunately it was called “correcção monetária” or monetary correction which made and makes everyone think it is only a monetary policy when it is in fact a monetary policy and an accounting paradigm, namely, daily indexing.

  5. In modern History of Mass Theft ,of trillions of billions in a couple decades, by governments where do we, proud Venezuelans rank today?

    We have to be up there with the Saudis and richest totalitarian nations, way past petty little thieves in Brazil or Argentina or Greece or even Russia. Up there with Hussein’s Iraq or Lybia, is my guess, ever. I’d love to have some educated guesses on that: Top 10 Most Corrupt Regimes in recent memory?

    • Doesn´t Amnesty International publish such a list every year? I know they publish one for Portugal. I read it in the free newspaper handed out at the train station: Most corrupt institutions in Portugal: 1. Municipalities 2. The Police.

    • Some of the smaller countries Africa are insanely corrupt as well, with a few very very very rich selling their country’s natural riches to Chinese and Western companies while the rest of the country is living in mud cabins with life expediencies in the 40s.

    • In 2013, Venezuela was ranked 161 worst out of the 175 countries by Transparency International. Another international organization (which I can’t recall at the moment) had them ranked 178 out of 190.

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