Scam at previous Venezuela parallel rate site

Scam at previous Venezuela parallel rate site

Reblogged from The Devil´s Excrement


Moraima Garcia Says:
March 27, 2013 at 11:25 am
Glenn, in truth there is more to the Lechuga Verde case, apparently they were running a scam, selling people dollars at lower prices (apparently dollars they got from SITME) and at some point they stopped paying peolple. There is a web page of the victims with very direct threats to the people of Lechuga Verde. Not sure if the creators of the site have been arrested or even if people really know who they are, but from what you can read online it seems they were not saints wanting to give us information about the real price that must not be mentioned.

Reply

• Nicolaas Smith Says:

  
  March 27, 2013 at 11:59 am CNN indicates this site Dolar Today http://dolartoday.com/ quoting the parallel rate daily.”Precio del Dolar paralelo en Venezuela y noticias SIN CENSURA…” It seems to be a Colombian site.
  

  Reply

island canuck Says:

March 27, 2013 at 11:33 am There’s been some confusion about this.
Lechuagaverde.com was responsible for defrauding 100′s(?) of people by offering US$ at below market prices. After paying off a few early clients they just stopped paying the rest. A typical Ponzi scheme.
I think its these owners who Maduro was referring to.
In the meantime you will see efforts to block access to other sites inside Venezuela that post current rates. One notably is publishing the current price in Cucuta, Colombia (which is a legal & active market) & the Implicit rate (current Bs. in circulation (liquidity) divided by the international reserves on hand).
Efforts to block access are pretty useless as they also have Twitter & FB accounts.

Bloomberg:


Dollar-Desperate Venezuelans Get Defrauded on Internet

Parallel rate in Venezuela

Parallel rate in Venezuela

CNN indicates this site Dolar Today http://dolartoday.com/ quoting the parallel rate daily.”Precio del Dolar paralelo en Venezuela y noticias SIN CENSURA…”

It seems to be a Colombian site.

Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Official and parallel rate generally unify at the parallel rate

Official and parallel rate generally unify at the parallel rate

The experience with unification indicates that it usually takes place at the parallel exchange rate.

Parallel exchange rates in developing countries : lessons from eight case studies, Volume 1

Kiguel, Miguel A.; O'Connell, Stephen A.;

Policy, Research working paper; no. WPS 1265

Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Fundamental mistake in IFRIC 7

Dear Mr Hoogervorst,

Thank you for your reply dated 19 February.

I further wish to point out to you that there is a fundamental mistake in IFRIC 7 Applying the Restatement Approach under IAS 29 Financial Reporting in Hyperinflationary Economies as follows:

Par 3 Consensus states:

Therefore, in relation to non-monetary items measured at historical cost, the entity’s opening statement of financial position at the beginning of the earliest period presented in the financial statements shall be restated to reflect the effect of inflationfrom the date the assets were acquired and the liabilities were incurred or assumed until the end of the reporting period. For non-monetary items carried in the opening statement of financial position at amounts current at dates other than those of acquisition or incurrence, that restatement shall reflect instead the effect of inflation from the dates those carrying amounts were determined until the end of the reporting period.

Inflation has no effect on the real value of non-monetary items.

‘Purchasing power of non monetary items does not change in spite of variation in national currency value.’

Gucenme U and Arsoy A P 2005 Changes in financial reporting in Turkey, Historical Development of Inflation Accounting 1960 – 2005 Academy of Accounting Historians 2005 Research Conference 6-8 Oct 2005 Ohio State University Columbus Ohio USA (Second last item on website referenced.)

It is the stable measuring unit assumption, and not inflation, that affects the real value of non-monetary items. Inflation only affects the real value of monetary items.

Please change the word inflation in IFRIC 7, Par 3 above to “the stable measuring unit assumption”.

You stated in your reply to me that “It is important that our staff collaboration approach retains a degree of flexibilityand agility to respond to the circumstances.” I have found that to mean flexibility to ignore facts.

You are free to ignore the above fact too.

Yours sincerely,

Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

The IASB has double standards

1. IAS 21, Par. 8: "Monetary items are units of currency held and assets and liabilities to be received or paid in a fixed or determinable number of units of currency."

2. IAS 29, Par. 12: "Monetary items are money held and items to be received or paid in money."


Here is the correct definition of monetary items:

Monetary items constitute the money supply.

For example: trade debtors (receivables) and trade creditors (payables) are not part of the money supply. They are not monetary items: they are constant real value non-monetary items.

 

Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

More Inflation Is the Cure for the Fed’s Impotence

Bloomberg

More Inflation Is the Cure for the Fed’s Impotence.

PIGS have to stay impotent since there is no help from the ECB with higher inflation and unlimited credit.

Difference between Fed and ECB

Difference between Fed and ECB

The Fed's mandate is "to promote sustainable growth, high levels of employment, stability of prices to help preserve the purchasing power of the dollar and moderate long-term interest rates." The ECB has no mandate to promote high levels of employment. The result is very real with 29 million unemployed in Europe.


Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

EMU countries are dollarized in terms of the Euro (Deutsche Mark)

EMU countries are dollarized in terms of the Euro (Deutsche Mark)

Dollarized countries have no independent monetary policies. EMU countries have no independent monetary policies. Their Central Banks have no autonomous monetary policy capability, the same as in dollarized countries like Zimbabwe, Equador and Panama.

Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Unlimited credit for PIGS

America and Japan successfully use the economic policy of unlimited credit in their economies: creating inflation in the case of Japan and quantitive easing in the case of the USA. Germany used the policy of unlimited credit very successfully in the case of East Germany after unification, but refuses to agree to the ECB using it in the case of Portugal, Ireland, Greece and Spain.

Europe uses the economically destructive policy of austerity in Portugal, Ireland, Greece and Spain (PIGS).

Inflation means that where the inflation is created, i.e., where the unlimited credit or free money is injected in the economy the country receives unlimited credit at no cost while the rest of the economy (consumers) pays for it in a slight increase in prices over a single year.

The ECB should supply PIGS with unlimited credit and consumers in the European Monetary Union would pay for it in a sligth increase in prices in every transaction over a single year. This would eliminate the neccessity for disastrous bail-outs at punitive payback rates that could stretch over a number of years.

When PIGS are economically sound again, the ECB would stop the unlimited credit.

Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Objectives of accounting / general purpose financial reporting

Objectives of accounting / general purpose financial reporting 

Updated on 14 January 2014

The objectives of general purpose financial reporting / accounting are

1. "To provide financial information about  the reporting entity that is useful to existing and potential investors, lenders and other creditors in making decisions about providing resources to the entity.”  Conceptual Framework

and

2. To legalise measurement bases that result in automatic capital maintenance in units of constant purchasing power in terms of an index that follows all (at least DAILY) changes in the general price level for an indefinite period of time in entities that at least break even in real value - ceteris paribus - during low inflation, high inflation, hyperinflation and deflation.


Nicolaas Smith

Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

How to automatically maintain your compay´s capital (equity) constant in real value

How to automatically maintain your compay´s capital (equity) constant in real value

 

Stop the stable measuring unit assumption (i.e. stop Historical Cost Accounting).

Guidance

1.                  Implement IFRS-authorised Capital Maintenance in Units of Constant Purchasing Power in terms of a Daily Index.

2.                  Keep no monetary item overnight unless it is inflation-indexed on a daily basis during inflation.

3.                  Your General Conditions of Sale (Contracts) has to state that outstanding receivables and payables will be measured in units of constant purchasing power on a daily basis in terms of a Daily Index from the date of sale (contract) till the date of settlement.

Do not ask the IASB for guidance in this issue. They do not understand IFRS-authorised CMCUPP. Contact me for guidance at realvalueaccounting[at]yahoo.com.

Nicolaas Smith
Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

How to automatically stabilise your economy

How to automatically stabilise your economy

Stop the stable measuring unit assumption (i.e. stop Historical Cost Accounting).

 

Guidance

1.       Implement IFRS-authorised Capital Maintenance in Units of Constant Purchasing Power in terms of a Daily Index.

2.       Inflation-index all monetary items daily in terms of a Daily Index with all money inside the banking system.

3.       The Central Bank is required to pay to (during inflation) or receive from (during deflation) commercial banks interest in terms of the Daily Index on the total overnight cash balances in commercial banks.

Do not ask the IASB for guidance in this issue. They do not understand IFRS-authorised CMCUPP. Contact me for guidance at realvalueaccounting[at]yahoo.com.

Nicolaas Smith
Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

See Hyperinflation in action

See Hyperinflation r in action.

IASB incapable of expressing a view about IAS 29 in Zimbabwe

 
According to Michael Stewart, Director of Implementation Activities at the IASB:

'I made a comment that until such time as the IASB decides that IAS 29 should be either amended or withdrawn, it is the appropriate standard to apply when the functional currency of an entity is the currency of a hyperinflationary economy (as defined in that standard). I think this is very different from the statement that you have attributed to me that "the IASB is satisfied with the implementation of IAS 29 during 8 years in Zimbabwe's hyperinflationary economy". The IASB has not conducted a review of the implementation of IAS 29 during 8 years in Zimbabwe's hyperinflationary economy so it is not possible for the IASB to express such a view without having undertaken such a review.'

Personal communication, 2013

Most accountants in the world, except the members of the IASB according to Michael Stewart as well as himself, can express the view that the implementation of IAS 29 had no positive effect in Zimbabwe.

Only the IASB and Michael Stewart need a review.

Most other interested parties can recognise what is obvious in history.

Nicolaas Smith
Opinions on this blog expressed by me are my personal opinions.
Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

IASB clueless about financial capital maintenance in units of constant purchasing power

IASB clueless about financial capital maintenance in units of constant purchasing power

Updated 12-01-2014

The IASB does not understand the difference between

1. Financial statements measured in constant purchasing power units (Agenda Paper 20)

and

2. Financial statements prepared under the concept of financial capital maintenance in constant purchasing power units. (Paper Topic)

The proofs are in the links.

(The IASB removed the title of Agenda Paper 20 which hides (in order to hide?) the fact that they had the two different descriptions for the same item: the one in the Title of Agenda Paper 20 on the Schedule for the 22 - 23 January 2013 IFRS Interpretations Committee meeting and the other in the actual Paper Topic in the actual Agenda Paper 20 pdf file.)

The IASB does not understand that financial statements prepared under the CAPITAL MAINTENANCE CONCEPT of finacial capital maintenance in constant purchasing power units is very, very, very different from year end financial statements simply measured (restated after year-end) in constant purchasing power units. The IASB is as blind as a bat about capital maintenance: absolutely clueless. However, I have come to realise that this is simply a reflection of the general view in most (not all - see CPA Australia and the Institute of Chartered Accountants Australia´s view that the IASB has "a lack of understanding about the fundamental role a capital maintenance concept has within the accounting framework") of the accounting profession about the financial capital maintenance concept.

Agenda Paper 20 contains 16 unresolved errors / problems / disagreements with the submitter (me).

As can be seen from the links, the IASB uses the two different descriptions of two different concepts for (the same) Agenda Paper 20.


Nicolaas Smith


Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Updated 12-01-2014

The most destructive requirement in IFRS authorised by the very inefficient IASB

The most destructive requirement in IFRS authorised by the very inefficient IASB

 

The failed IAS 29, the IASB´s greatest failure to date, affected the Zimbabwe economy very negatively during hyperinflation. It was implemented during various years in Zimbabwe´s hyperinflationary economy with no positive effect. The failed IAS 29 had a very negative effect since it encourages and requires the implementation of the Historical Cost Accounting model during hyperinflation, the most destructive requirement in IFRS authorised by the very inefficient IASB.

Nicolaas Smith
Opinions on this blog expressed by me are my personal opinions.
Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Financial reporting affects the economy

Financial reporting affects the economy

Accounting which includes financial reporting affects the economy via the accounting policies and especially the measurement bases adopted by entities.  Accounting records economic activity. Economic activity is affected by the choice of accounting policies and measurement bases. Accounting is recording of economic activity. Accounting policies influence the choice of measurement bases which affects the economy.

The single most powerful measurement base affecting the economy is the choice of implementing the stable measuring unit assumption, i.e., choosing Historical Cost Accounting.

The actual implementation of the stable measuring unit assumption is not the recording of economic activity. Implementing the stable measuring unit assumption  is a business practice / policy which is after the event recorded via accounting and financial reporting when the period-end financial statements are prepared.

Thus implementing the stable measuring unit assumption is not accounting. It is the implementation of a business practice. The Conceptual Framework states that the choice of the measurement bases and the capital maintenance concept chosen, determines the accounting model.

HCA causes the cost of inflation and the cost of hyperinflation because it is chosen by the board of directors as the accounting model to be used by the entity. HCA requires the implementation of the stable measuring unit assumption in the measurement of certain items.

HCA determines the business practice. HCA decides when economic items will be required to be measured implementing the stable measuring unit assumption.

Thus, HCA causes the cost of inflation and the cost of hyperinflation, not actual inflation and actual hyperinflation which are economic processes, not accounting practices.

Nicolaas Smith
Opinions on this blog expressed by me are my personal opinions.
Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Bank of Japan bows to inflation pressure.

CNN

Bank of Japan bows to inflation pressure.

World Bank response

World Bank response to my unsuccessful request for funding for Sustainable Development without Borders (NGO):


"The research that you propose would indeed be of great interest to countries experiencing high inflation rates."


Jean-Jaques Dethier
Research Manager
Development Economics
World Bank


Nicolaas Smith
Opinions on this blog expressed by me are my personal opinions.
Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.

Venezuela in hyperinflation struggles for food supplies

Venezuela in hyperinflation struggles for food supplies

Nicolaas Smith Opinions on this blog expressed by me are my personal opinions. Copyright (c) 2005-2013 Nicolaas J Smith. All rights reserved. No reproduction without permission.