They just crossed a big threshold - from CNN:
Venezuela just defaulted, moving deeper into crisis
Venezuela, a nation spiraling into a humanitarian crisis, has missed a debt payment. It could soon face grim consequences.
The South American country defaulted on its debt, according to a statement issued Monday night by S&P Global Ratings. The agency said the 30-day grace period had expired for a payment that was due in October.
A debt default risks setting off a dangerous series of events that could exacerbate Venezuela's food and medical shortages.
If enough holders of a particular bond demand full and immediate repayment, it can prompt investors across all Venezuelan bonds to demand the same thing. Since Venezuela doesn't have the money to pay all its bondholders right now, investors would then be entitled to seize the country's assets -- primarily barrels of oil -- outside its borders.
And the root cause of Venezuela's problems?
But experts say the socialist Venezuelan regime that has been in power since 1999 bears the brunt of the blame. It fixed -- or froze -- prices on everything from a cup of coffee to a tank of gas in an effort to make goods more affordable for the masses. For years, Venezuelan leaders also fixed the exchange rate for their currency, the bolivar.
Those moves were among the driving forces behind the food shortages. Farmers couldn't sell at low prices without going out of business because their cost of production was much higher. Importers also couldn't afford to ship in food, knowing they would have to sell at much lower prices than what they paid for at the port.
When food shortages grew worse, an illegal black market emerged where venders sold basic foods at vastly higher prices than the government's artificially low prices. Inflation soared, making the bolivar almost worthless.
The really sad thing is that Venezuela used to be the bread-basket of South America. It has a great climate, lots of arable land and it used to export food to the rest of the world. It was taking in so much money that the people elected a government that promised free shit and the people kept demanding more and more free shit until all the money was spent. On the way down the drain, the Venezuelan government cannibalized its own economic sector to pay for the free shit. They stopped maintaining roads, water and electrical systems and nationalized various industries so the whole nation's infrastructure is crumbling.
When anyone suggests that a centralized world government is a good idea or that socialism or progressivism is a good idea, this is the end result of what they are talking about. Always has been, always will be.
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