The Latin American Report # 647
In recent days, there has been an intense debate in Cuba related to an information service offered by the "independent" media outlet elTOQUE. It involves the daily, or more than daily real-time, publication of the US dollar's value on the Cuban informal market. In truth, to begin with, this informal market ends up being the market, because the so-called official Exchange Houses only sell a handful of dollars to the population through a ticket system, a (virtual) queue, in which, at a minimum, we can wait approximately a year until receiving notification to buy a maximum of 100 dollars. I, for example, am number 39,374 in a virtual queue that yesterday closed at position 20,848.
Thus, the informal market is the one that ends up providing the volumes people need to resolve certain urgencies, whether it's buying food and other necessities in state-owned stores that only sell in dollars, or simply to burn the depressed Cuban pesos to leverage their monetary assets into US currency. But it's not just about the immediate needs of common people; this informal market also meets the demand of many private entrepreneurs who import products like rice, sausages, chicken, ground meat, or cooking oil, which then end up in a formal/informal sales network for the population, obviously subjected to the fluctuations of the dollar's price. That is—and this next point is very serious—: it is an open secret that a good part of what has entered the country legally has been acquired with dollars bought in that murky market.
For all the above reasons, what elTOQUE does, and how it does it, invariably impacts the (under)development of the country's economy, which, in any case, has reached this unfathomable crisis due to the confluence of several factors. These latter could be summarized into two: the impact of US sanctions, which are the most comprehensive applied to any country, and terrible statecraft, especially over the last five years. But the outlet is, without any doubt, the main reference for the market's "health"; in this issue, they are our de facto Central Bank. When I myself buy my annual 100 dollars—and this is because I live in Havana; outside here the wait can exceed two years—, I usually resell them at the price indicated by the elTOQUE exchange rate that day.
SourceNow, the first problem I have with elTOQUE is that it is a media outlet that provides services, as a vendor, to the US Government. It does this through two corporations based in Florida, the for-profit Mediaplus Experience and the not-for-profit Mas Voces Foundation. This is a problematic link considering US policy towards Cuba, which is directly oriented towards regime change in Cuba and is therefore a flagrant denial of the Island's sovereignty. However, there is no proof that, through elTOQUE, Washington is manipulating the exchange rate. I don't rule it out either, but the mere connection is, for me, a punishable fact.
Then there is the issue of the "methodology" used by the not-independent outlet, which boils down to finding "the median of the numbers written in buy/sell ads for foreign currency in social media groups and [online informal marketplaces]." This, as anyone can understand, is extremely vulnerable to manipulation, which is not to say it has been proven that elTOQUE is colluding with certain actors to actively manipulate this calculation mechanism to which they have appealed. Yet, certainly, this platform clearly would not be a factor if the country had the foreign currency to supply the market, at least for those who can produce (exportable) goods and services on-island. In this sense, Cuba is facing the need for a sound financial intervention that no ally or friend seems willing or able to conduct. The reasons why the latter is happening can be discussed in another long-form insight about my country.
SourceThis is all for today’s report.
That's harsher than expected, and you point out it's worse outside Havana. Such terrible suffering in such a beautiful country.
You make many good points about the informal market mechanism. I am confident every entity that has both a non profit and a for profit arm is dirty. However, when there's only one port in a storm, at least there's a port in the storm.
Thanks!
I agree with you here. There is some discussion about what could happen if this daily index is paused somehow. It has concerning links and a very vulnerable methodology, but could be the market sentiment worst, or at least most erratic, without it? It is a plausible point, taking also into account that, at the end, the main responsibility to put some order in the house lies in the Government. Those with some stake in crypto are also victims amid all this financial disorder. Thanks always for your feedback here.
I cannot agree. It is not the government that will starve if it fails to maintain order nominal to sustain grocers. It is you, and if that happens, it will not happen because the government failed, but because you did. If it happens to you, it's your fault.
I was raised in Alaska, a very beautiful, dangerous place. By the time I was 30 half my high school graduating class was dead. One of my classmates was on a camping trip with her fiance when their boat capsized in a storm. She struggled to reach the distant shore, strove to drag her beloved fiance with her, but could not bear his unconscious weight. She did reach the shore, in desperate danger of dying, soaking wet, cold, and hungry. She made a pile of moss and burrowed into it like a mouse, managing to survive the night. She was rescued the following day, but her fiance was not found for several more, unfortunately drowned. She lived, and he did not.
Many similar events sorted my classmates into the living and the dead.
Men, like wolves, are born wild and free.
We must carry our weight to keep our legacy an inheritance for our posterity. If we do not, and become dependent on others, we may survive, but lose our real value, and our posterity will never know what we are capable of, what we truly are.
IMG source - Amazon.com
This is why I recommend aquaponics, 3D printers, and all the decentralized means of production that have recently advented. Not because I envy the wealth of overlords, but because I do not. I don't want what is theirs. I don't want you to be dependent on masters, either. I want to live in a world of free, prosperous men that merit what they have.
Like wolves, men are social animals, I am confident I want to live in a free society of men, not pampered pets.
To domesticate a wolf, you must capture them as puppies and raise them in captivity. We have been domesticated from birth. Very few domesticated animals break free and succeed in the wild, but I have been hunting in the high mountains here and encountered feral cattle, escaped from some dairy or ranch and living off the land. While I was indoctrinated in public school, I also was raised in a small town surrounded by a large wilderness, which enabled me to learn to live in that wilderness as well as in town.
Perhaps it is this dual understanding that compels me to see how owning the means of production myself enables me to both enjoy the blessings of civilization that I make myself, and do so free of masters, not dependent on their provision of those blessings as we were taught to be.
IMG source - Malone.news
I am literally a government free zone. I alone will my heavy hand to rise to my weary brow and wipe away the dripping sweat of my hard labor. I owe no man the product of my labor. My property is the fruit of my will, that I alone have produced, and I alone merit. If I fail, the thieves that demand my property will not starve. I will. If I succeed those thieves do not deserve the fruits of my will any more than they deserve to starve when I produce no fruit.
Because I have been indoctrinated from birth to be a slave to masters that demand the fruit of my will, I suffer theft by fraud, deceived to misunderstand what I am and who they are. They are not my masters. They are thieves. I am not a slave, a helpless dependent on my owners - if I make what I need. When I make what I need I am independent, and independence is freedom. I merit my freedom or my slavery, my life or my death. There are no excuses. If it happens to me it's my responsibility.
I live in a society, and have often willingly served little old ladies, whom needed my services but had no money to pay. I have many times happily accepted their goodwill for their new floors, decks, and repairs to their homes, because I had the ability to provide those things and they needed them. When a corporation purchased the land where I have lived for eight years, serving the community in which I lived, they illegally evicted me, and trespassed me from the property, preventing me from recovering my personal property by threat of arrest. The little old ladies, my neighbors, crawled under my trailer and unhooked the sewer, the water, the electricity, recovered my pots and garden, and as much of my possessions as they could before the corporation stole it. What they could not secure, the corporation stole. That good service I provided my good neighbors was as good as gold. Being free does not make me larcenous, greedy, or selfish, and doing good work for good people for goodwill is not a loss. Government, like the corporations they charter, are not my good neighbors, and does not need my services, my property, for free, but steals it. That is a loss. That is the difference between society, which is people capable of goodwill and mutual affection, and institutions like governments and corporations, which are not.
That is the legacy I intend my sons to inherit, and nothing can excuse my failure to deliver a society of free men to my posterity, because nothing can excuse me for delivering my sons into slavery, the property of governments and corporations.
I encourage you to ensure by your own hand, by your own will, that you and your son do not starve, that my sons will live in a society of free, prosperous men because your sons are such men.