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So the government just begged bolivar to the government's own cryptocurrency, the petro. We already know that this does nothing. Venezuelan government refuse

So the government just begged bolivar to the government's own cryptocurrency, the petro. We already know that this does nothing. Venezuelan government refuses to reduce the government spending to match the government income. In fact they just announced 3,000% wage increase at the same time. No matter what the name of currency, as long as it's Venezuelan government issued currency, it's going to lose value. There is no way this peg will hold. They just alter the way pedro is calculated or do other shenanigans. Is there betting market for this? I want to bet several thousands against pedro/bolivar.

ISL 8y ago
At what odds?
cat199 8y ago
So the government just pegged USD to the government's own cryptocurrency, the petrodollar. We already know that this does everything. US government refuses to reduce the government spending to match the government income. In fact they just announced 3,000% tax decrease at the same time. No matter what the name of currency, as long as it's US government issued currency, it's going to gain value. There is no way this peg will fail. They just alter the way petrodollar is calculated or start other revolutions. Is there betting market for this? I want to bet several thousands on USD/petrodollar.
- Nokinside 8y ago
  Petrodollar's importance for US economy is not that important. The net financial benefit from petrodollar to the United States in a good year is something between 0.3 to 0.5 percent of US GDP. On crisis years it's fraction of that. The main cost from petrodollar is that that the dollar exchange rate is an estimated 5 to 10 percent higher than it would otherwise. This hurts exports.
theseatoms 8y ago
Presumably there's some way to take out bolivar-denominated loans?
- rthomas6 8y ago
  Probably not at a low enough interest rate.
- Nokinside 8y ago
  Incidentally that would have prevented Venezuelan currency and debt crisis in the first place. I seriously doubt that any bank would give out bolivar-denominated loans with fixed interest rate that is below 100%. I could take a two year debt with 10% interest easily. Venezuelans are already earning more gold farming RuneScape than actually farming.
- NullPrefix 8y ago
  Shorting Bolivar?

ISL 8y ago

At what odds?

cat199 8y ago

So the government just pegged USD to the government's own cryptocurrency, the petrodollar. We already know that this does everything. US government refuses to reduce the government spending to match the government income. In fact they just announced 3,000% tax decrease at the same time. No matter what the name of currency, as long as it's US government issued currency, it's going to gain value. There is no way this peg will fail. They just alter the way petrodollar is calculated or start other revolutions. Is there betting market for this? I want to bet several thousands on USD/petrodollar.

Nokinside 8y ago
Petrodollar's importance for US economy is not that important. The net financial benefit from petrodollar to the United States in a good year is something between 0.3 to 0.5 percent of US GDP. On crisis years it's fraction of that. The main cost from petrodollar is that that the dollar exchange rate is an estimated 5 to 10 percent higher than it would otherwise. This hurts exports.

theseatoms 8y ago

Presumably there's some way to take out bolivar-denominated loans?

rthomas6 8y ago
Probably not at a low enough interest rate.
Nokinside 8y ago
Incidentally that would have prevented Venezuelan currency and debt crisis in the first place. I seriously doubt that any bank would give out bolivar-denominated loans with fixed interest rate that is below 100%. I could take a two year debt with 10% interest easily. Venezuelans are already earning more gold farming RuneScape than actually farming.
NullPrefix 8y ago
Shorting Bolivar?