Hugo Chavez Ships Mountains of Gold to Caracas as Panic Runs on Toilet Paper Begin
Hugo Chavez has a new plan to save Venezuela's teetering national economy and it's, uh, shipping giant mountains of gold into Venezuela amid a procession of tanks so he can end the "dictatorship of the U.S. dollar" and possibly "offer President Obama a loan."
So how did his grateful people react? Well, Caracas was riled all weekend with panicked runs on toilet paper, coffee, and other staples.
Chavez's plan is to "repatriate" all of Venezuela's gold held in foreign banks, a total of about 365 tons worth around $20 billion. At the same time, Chavez plans to nationalize the Venezuelan gold mining industry.
The first shipment, with more than 200 tons of gold, arrived in Caracas on Friday in a military procession, with soldiers sitting astride boxes filled with the precious metal.
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Chavez says the move will give the Bolivarian Revolution better control of its currency, which has suffered wild spikes during his tenure.
But experts say there's only one reason for the gold grab.
"This is a political move," Jose Guerra, a Venezuelan economist, tells the Global Post this morning. "Chavez can say, 'The gold is now in Venezuela, so we've recovered our dignity ... and the reserves are now in the Central Bank.'"
The golden gamble may have re-upped Chavez's standings in poor neighborhoods, but it did little reassure most Venezuelans.
Coupled with a new set of price controls announced on more than 15,000 items, Venezuelan shoppers have been raiding supermarkets since last week to stockpile everything from toothpaste to soap.
"We heard rumors that there'd be shortages of toilet paper and toothpaste and all basic hygiene products," Jonathan Maestracci, a 24-year-old student, tells Bloomberg News. "Finding coffee now is practically impossible. It's better to buy in big quantities thinking about what could happen. If nothing happens, you just keep it."
Gold, though? They're good on gold, as Chavez gleefully reminded a cheering crowd.
"The Yankees are broke," Chavez said from his palace's balcony earlier this year, Global Post writes. "They have no money to pay their debt ... Shall we give Obama a loan?"
Actually, now that you mention it ...
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