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IPFS News Link • Economy - International

HYPERINFLATION! Venezuela Orders Bank Notes by Planeloads

• LewRockwell

WSJ reports that Venezuela's central bank's own printing presses in the industrial city of Maracay don't have enough security paper and metal to print more than a small portion of the country's bills.

This is what happens when massive amounts of new money are printed, the desire to hold cash balances shrinks to near zero.

WSJ explains:

Venezuela's 30 million people can't seem to get cash fast enough, said Steve H. Hanke, an expert on troubled currencies at Johns Hopkins University. "People want cash because they want to get rid of it as fast as they can," he said.

While use of credit cards and bank transfers is up, Venezuelans have to carry stacks of cash as many vendors try to avoid transaction fees. Dinner at a nice restaurant can cost a brick-size stack of bills. A cheese-stuffed corn cake—called an arepa—sells for nearly 1,000 bolivars, requiring 10 bills of the highest-denomination 100-bolivar bill, each worth less than 10 U.S. cents.

The printing spree is good business for banknote printers. WSJ again:


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