Here you have two items: a chocolate bar, and a box of over-the-counter painkillers.
One of these items costs BsF 4.5, about 60 US cents at the official rate, and about 7 cents at the black market rate. The other item costs BsF 50, about 8 dollars at the official rate, and about 83 cents at the black market rate.
Can you guess which is which?
Cand you imagine what this level of distortions does to salaries? TO companies thinking of investing? To consumers shopping around for the best bargains?
There is an economic war, alright. But it’s not the war chavistas claim, and it’s not a war against capitalism either. It’s a war against the pricing mechanism, against the very idea of allocating resources.
In a nutshell, prices have stopped meaning anything in Venezuela, other than letting you know how screwed up our economy is. They don’t indicate value – they are a measure of our distortions.