When a collapse occurs, aside from the obvious, there are plenty of things that happen. Chaos theory kicks in, and depending on the location, crazy things transpire. An example of this is Singapore and what happed that led to it being one of the world’s safest countries.
A brief history of Singapore: Singapore in the middle 50s and 60s had serious problems: unemployment, housing shortage because of over-population, racial tension, and corruption. Though hospitals were still running, if you wanted care, a bribe was necessary. Mafia and crime were a concern also.
PAP (The People’s Action Party Est 1954) became the ruling political party of Singapore in 1965. PAP took steps to increase the penalties for corruption, something that many countries take lightly. The worst punishments were for those robbing the social programs with the most impact, like health, education, or childhood/elderly care. The governing party also proceeded to pass bills regarding state employees, their positions, and their financial accounts. The reason for monitoring the accounts was to track down those who were giving or accepting bribes. As a result of the new bills, many state employees were sent to jail, thereby cutting down corruption. Some of them even received the death penalty. Drug dealing was another crime punishable by death.
It is important to note Singapore’s justice system collaborated from the beginning to make this happen. Something I believe will never happen in my country.
A new scam has started in Venezuela’s twisted economy
Something I never thought could happen, as it doesn’t have any precedents, has. And it is something that caught me entirely by surprise.
I know my countrymen. They can be so creative they indeed could deserve some award to survive (and even thrive) in harsh environments. They can twist and bend the rules to extreme degrees not seen in other parts of the world, even in South America. And I’m afraid we’re going to see more of this soon.
There is a vast exchange market somewhere – a very dark exchange market
A deposit is made to someone of 35 Peruvian soles. In turn, they deposit roughly 12-13 million Bolivares, no questions asked. Where did they get the Bolivares? Well, that is a good question. To me, it remains a mystery. Bank fees are ridiculously low, and I doubt they are making money enough to pay the power bill.
They are buying USD, cash, banknotes, considered “in bad shape” or “partially damaged” by the general public. (Public meaning those who have never been outside our borders, of course.) Not one country I have visited would say this is damaged currency. However, the shops and supermarkets are demanding banknotes to be in excellent shape. Does this seem suspicious to you? It does to me. (Ok, maybe I have too many TV shows bouncing around in my mind. But it does remind me of a couple of competitors giving El Don, the more significant drug dealer, a bunch of cash. One of them with the banknotes rolled up, a dirty mess in a duffel bag, and the other one a neat series of blocks, wrapped in plastic. You get the point.)
Suppose you are buying groceries or clothes and the banknote has very slight “damage” (a small ink stain, for example, or too many wrinkles). In that case, they immediately try to force the customer to accept less for their money. For example, the customer is told, “This bill is not worth 20$, as it is damaged. We will take it if you accept that it is worth only $15 (or $18, $19…at the cashier’s discretion) in groceries.”
What the…? Come on. How does this work?
“Smart” people will buy “defective” banknotes from an unknowledgeable population that has hardly seen cash dollars in their lives. To them, a little ink stain is a defect. Those “smart” people take advantage of this by blatantly offering 15$ for a 20$ that is quite used or with an ink stain.
Many shops won’t accept these banknotes. Poor people are often forced to sell their damaged notes for less than the actual worth. They will offer 8$ for a 10$ note and 90$ for a 100$ with some “damage.”
Repeat this operation 100 times, and you will collect enough “damaged” cash that will be entirely acceptable across the border. People travel with this stash to buy national currency and return a few hours later to exchange them again. No matter the loss, as it has been indeed already covered with the abuse.
And this, ladies and gentlemen, is an entire commercial activity by itself
It is shameful that people are more than willing to kick their honesty through the window if there is a way to make money with less effort. And if that means they scam a few fellow citizens in the meantime, too bad.
I have to wonder where all of that exchanged money goes. The people have nearly dropped the national currency, mostly electronic, and are using other countries’ currency, such as Colombian peso, Euros, USD, and Brazilian Reals (BRL).
As there is no real exchange system of currency with the outside world, the Bolivares remain whirling endlessly inside our border as it cannot be considered a “reserve” currency. And a real problem in my country as the so-called “dollarization” process (which is NOT) occurs is a shortage of coins and small bills.
To me, this is not a real way to make money. It is part of a subculture that brings out the worst of the human species. How quickly this practice has extended throughout the country makes me realize how some past myths have remained as something forbidden and terrible. As Selco has said, there will always be new rules in a collapse and someone will enforce them.
Oh, and if you are a Venezuelan and are reading this, feel free to send me all of your “damaged” 20$ banknotes you don’t want messing up your wallet anymore. I will be happy to receive them.
Jose is an upper middle class professional. He is a former worker of the oil state company with a Bachelor’s degree from one of the best national Universities. He has a small 4 members family, plus two cats and a dog. An old but in good shape SUV, a good 150 square meters house in a nice neighborhood, in a small but (formerly) prosperous city with two middle size malls. Jose is a prepper and shares his eyewitness accounts and survival stories from the collapse of his beloved Venezuela. Thanks to your help Jose has gotten his family out of Venezuela. They are currently setting up a new life in another country. Follow Jose on YouTube and gain access to his exclusive content on Patreon. Donations: paypal.me/JoseM151
Surprising to think there’s something worse off than the US dollar.
And much, much worse , amigo.
Discounting “damaged” foreign bills is not as uncommon as you may believe. For example, in Taiwan, not a corrupt country, banks taking US$ in exchange for Taiwan dollars require the bills to be absolutely perfect to be accepted at full face value. Even one stray extraneous ink mark or crease will cause them to discount its exchange value by 10%, or in many cases, not to accept it at all.
I know this from personal experience. When I travel there and take US$ with me for exchange, I must get the bank to give me NEW currency, and then laboriously go through each bill to ensure it is blemish free.
Whenever I have traveled to third world countries (China, Southeast Asia, Mexico, South America) in the past 15 years the tour company has told us to only bring pristine currency to use or it would not be accepted. Indeed shop owners have looked at any American dollars carefully as the banks will not accept blemished U.S. currency. It has been a pain to go to the bank and go through with the teller at least $100 of one dollar bills to get 20-25 pristine ones. Even a small 1/8″ tear makes them unusable. You have to take a lot of small denominations to buy things from local people. Only big stores will take a credit card.
In Ecuador where I lived for some time, they didn´t have any problem with that…it seems to me more like an elaborated scam out of control than anything else, and now it´s accepted as “the new Normal”. I´ve found dumb people and scammers every country I go. LOL.
Its a sad commentary on human nature.
My state has,signed on to the equivalent 9f the Green New Deal. No gas vehicles and no heating with wood or natural gas after 2030. Almost makes you wish for SHTF so you can move on and forget the insanity out there. A friend said her state has now joined that insanity as well.
If I were you I would get a biogas setup now. It´s not that hard if you want to make it yourself and plan ahead.
No wood burning? That’s crazy! I got a forest surrounding me, with blown down trees scattered about. If I don’t use them for firewood they just lay there and rot away – which produces carbon dioxide and water, just like burning it, only slower.
Tropical forest don´t regenerate as fast as other latitudes. And growing rates are much lower. Bush and weed, yes, but useful woods need many decades to regenerate.
Well this is a new twist
I get the point of the article, but I want to make a semantical point:
Isn’t “the actual value” of a USD nil?
There is nothing backing it.
This is not new at all. Here in Mongolia they won’t take them unless they are crisp and clean. And those in poor condition go for a lesser rate or not at all.
Just read this story on zero hedge.
Myanmar since it really opened up also refuses banknotes with blemish. This occurred starting in the early 00s. I was there first in 1992 and do not recall such issues.
A difference though. Then, exchange was entirely on the black market.
Now, money is exchanged on the gray market. Small money changers.
But the difference is they require absolutely pristine notes. Even a perfect note with a tiny smudge or bank stamp is not accepted.
Note, I said not accepted. Last time I was there I was never offered less for such notes. It’s possible because they know I’d scoff – perfectly good note at discount and my ability to leave the country with it.
Nevertheless, this is one country that at face value runs contrary to your claim.
It is possible that really dirty money held somehow by locals is purchased at a discount and sold at the border or in Thailand. I simply do not know.
Um, sorry to mention this but reading this article was difficult due to all the ads that kept popping up, then I look at the top ad. $5 a month will get me an ad free experience. Well the ads were never this annoying before, in fact this is the first time I noticed them. Sorry, I know you need to make a living too but… I would completely understand if you decided to not offer free content and simply charged a fee for your articles. I know you put a lot of work into them and you deserve to be compensated. Flooding your site with ads and then offering to make them go away for $5 a month somehow rubs me the wrong way though. It seems like an underhanded way to make readers to pay without actually asking them to pay. Like just annoying us enough so we will cough up the cash. Honestly, I will not pay for ad free, I just won’t read the articles. I might have subscribed for paid content but this seems like a nasty trick especially since the ads are a new thing that started when ad free content became available.
Our ads haven’t changed at all. We’re with the same network as we have been for 4 years on their “medium” level of ad coverage. Ad blockers are another option. Sorry to see you go.
In some places in Africa lower denomination notes sell for less than the market value, anything less than 100 bill will be exchanged for less, and a bill with wrinkles or bends will sell for less than market price, as well as a bill that is dated too far back (could be a year old for example)
“During an economic crisis, someone will always figure out a way to make a living ripping off struggling, desperate people. ”
I regularly leave the positive version of that:
There are always winners and losers. Even in the Great Depression and Refugee Camps there are entrepreneurs that figure out how to not only survive but thrive by offering something people need at a fair price.
Yes, there are always vultures, but some humans overcome their evil nature and actually earn a living by doing good for everyone.