What happens when you aren't the reserve currency?

[Cancel 2016.2]

http://www.bloomberg.com/news/2013-...-venezuelans-to-queue-before-price-raise.html

Chavez, who is recovering from cancer surgery in Havana, ordered his government to weaken the exchange rate by 32 percent to 6.3 bolivars per dollar starting Feb. 13, Finance Minister Jorge Giordani told reporters Feb. 8. Yesterday, a sign at an electronics store in southeastern Caracas restricted customers to one purchase each as Venezuelans rushed to buy flat-screen televisions.

Massive devaluation of currency should really help the poor and middle class in his country.

A spending spree that almost tripled the fiscal deficit last year helped Chavez, 58, win a third six-year term. The devaluation can help narrow the budget deficit by increasing the amount of bolivars the government receives from oil exports.
Yet the move may also quicken inflation to more than 30 percent a year from 22 percent in January, Siobhan Morden, the head of Latin America fixed income strategy at Jefferies Group Inc. in New York, said in a note to clients.

But hey, if his spending helped keep him and his cronies in power, who care about the little guy they just promised the world to? Inflate that poor bastard to death.

 

[Damocles]

I wonder what BAC thinks of this. He's been the champion of Venezuela on this site for quite some time.

This isn't good for the poor especially.

 

[Cancel 2016.2]

True... I would be curious to hear his thoughts on it.