Pdvsa's higher funding to central bank spurs inflation
Professor Pedro Palma of the Higher Business Studies Institute (IESA) warned that money in circulation has skyrocketed
Palma explained that Pdvsa issues bonds that are bought by the central bank by printing new bolivars. Once Pdvsa spends all this money, the funds go to the banking system, which relies on it to grant loans. This way, the amount of money in circulation skyrockets and spurs prices.
If this situation continues, "we will experience an increasingly remarkable expansion of the monetary base, which in turn the financial system will double or triple. This may lead to an explosive expansion of money supply that will result in significant inflation."
The IESA professor also indicated that ahead of the elections held in 2012, Hugo Chávez's Government boosted public expenditure to the extent that today it faces a fiscal gap that represents eight percent of the gross domestic product (GDP). Including the whole public sector, the gap stands at 14% percent of the GDP.
Translated by Jhean Cabrera
Pablo Jiménez Guaricuco was summarily dismissed from his Clerk III job at the Autonomous Service of Public Registries and Notaries' Offices (Saren). He read a notice published in a newspaper on November 5 informing the public that he was no longer employed to the Saren. He was sacked despite the fact that he was taking a leave of absence from work due to a work-related accident, and that he enjoyed security of employment under the parental job-immunity privilege. Most probably, the decision was influenced by his role as a union organizer. But what did he do, besides leading protests, to deserve the sack? Well, he allegedly sent off a series of tweets that definitely hurt the sensitivity of the Saren Directorate.