Business News Asia
The inflation rate in Venezuela was as high as 1946% in September! Down from 2343.9% in August, Venezuela is experiencing bitter hyperinflation.
It is hardly surprising that the Venezuelan people are abandoning the local currency, the bolivar, and turning to more stable currencies like the U.S. dollar. In some border regions, such as Colombia, the Colombian peso is used.
But recently, real money has also re-established itself in Venezuela and is accepted by many businesses as a medium of exchange. For example, gold flakes are used to pay for a visit to the hairdresser. Mostly the gold flakes are wrapped in worthless fiat paper in order not to lose them.
Although many like to see gold as a medium of exchange, gold as a stable asset also attracts crime. Thus, the citizens of Venezuela should be aware of the value of gold and not give it away if they own or have it with them.
It would also be exciting to see a project like the one that started in El Salvador, which introduced Bitcoin as a legal tender. This would allow the citizens of Venezuela to escape the government’s centralized monetary system and rebuild their prosperity. Of course, infrastructures have to be created, but as seen in El Salvador, the experiment can help poor countries and especially the poor population.
However, it is interesting to see that countries struggling with hyperinflation or significant economic problems are turning to gold as a medium of trade. So one can see again that gold is seen as an object of value and that for thousands of years. Thus, gold is and remains real money.