The POH Diaries

I suppose one of the perks of being a dictator is that you can do whatever the hell you want with your country’s resources. You know, like oil, or gold. Hugo Chavez plans on doing just that, with gold off the charts right now, above $1700 an ounce, the Venezuelan government will nationalize production including extraction and processing and use it’s output to boost international reserves. Nice.

Reuters has the story:

The move follows a dispute between his government and foreign miners who say the rules limiting the amount of gold that can be exported from the South American nation hurt their efforts to secure financing and create jobs.

Toronto-listed Rusoro, owned by Russia’s Agapov family, is the only large gold miner operating in Venezuela. It produced 100,000 ounces last year.

The gold industry will be just the latest part of the economy to be put under state control by the socialist leader, who said he would issue the necessary decree in the coming days and called on the military to help control the sector.

Chavez made the proclamation in a phone call to state television. He said that because gold continues to rise in value, he would nationalize the industry in what he called a state “exploitation” of gold and all related activities.

Hey, don’t blame him. He’s only following in the footsteps of FDR. Obama would do it if he could get away with it. The problem for Venezuela is that Chavez can get away with it.