The Disaster of De-Industrialization

by Charles Hugh Smith
Of Two Minds

Once a nation no longer produce essential goods and services, it becomes vulnerable to collapse.

By now, we all know what’s happening in Venezuela: hyperinflation, empty stores, a regime in denial. The Trajectory of Venezuelan Hyperinflation Looks Frighteningly Familiar… (Zero Hedge)

[…] My contacts in Venezuela tell me that merely posting the black market exchange rate of bolivars to USD can get you arrested. So yes, Venezuela’s regime has gone full Orwell-1984: whatever is true is outlawed.

Venezuela is imploding not because of hyper-inflation, but as a result of policies that led to hyper-inflation: policies that generate perverse incentives, disincentives to produce goods and services and incentives to depend on government subsidies.

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