Saturday, February 09, 2008

No signs of progress 

We've now had the first full month since the referendum and since Chavez promised rectifications and there are still no signs of progress on at least one front.

Automobile sales have been one of the clearest examples of the wasteful consumption binge of the past year and they are still at sky high levels.

In January 27,943 new cars were sold which, with a decrease of 2.4% over January 2007, is essentially unchanged. So the binge continues.

Worse still only 6,236 were produced in Venezuela while 21,707 were imported. Compared to last year domestic production declined 17.3% and imports increased 3%. Oh, and exports dropped from a miniscule 1,105 last January to 0 this January!!!!

At this point shouldn't those numbers be headed in the opposite direction with imports declining and domestic production increasing????? Yes they should.

But right now Venezuela has a dramatically overvalued currency and no obvious industrial policy.

Time and money are being wasted. Eventually they will both run out.


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