How To Make Money During Hyperinflation

A man folds Venezuelan banknotes to make a handbag in Maicao, Colombia, on Feb. In the dusty Colombian town of Maicao, four men and women huddle along a shady patch of concrete and form an assembly line. One unpacks a rubber-banded heap of banknotes. The next person folds how To Make Money During Hyperinflation bill in half. Another performs a few more folds.

Finally, the last one in line makes the braid that turns the finished product into a handbag. Orlando Silva, the young man in charge of the business, who asked TIME to use a pseudonym because he fears for his safety. In January 2017, Silva showed up on the streets of Maicao, a northern Colombian town just 7 miles from Venezuela’s border, with no passport, no money and no place to sleep. Like so many other Venezuelans fleeing their country’s economic crisis, the 26-year-old spent months broke and hungry, roaming northern Colombia’s mesquite-cloaked region of Guajira. And then, a year after he arrived, Silva finally found an opportunity that would make him some cash: the handbag-making business. Except instead of using soft leather or fine silk threads, he turned to a different material. Braiding together worthless banknotes of bolivares, Venezuela’s failed currency, to create purses, handbags and wallets, Silva now earns just about enough money to eat.

He uses two or three denominations for each bag—the 500 banknotes are usually worth between 25,000 and 50,000 bolivares, which today amounts to 10-20 cents. His customers come from Bogota, Medellin and other parts of the country to Maicao, a town notorious for its flood of cheap contraband goods. Venezuela’s economic collapse is the result of years of over-reliance on oil revenues, and over-spending on social programs. The crisis since Maduro’s election has forced some 1. 5 million people to flee because of political persecution, chronic food shortages, and scarce medical supplies. Silva, dressed in dirty clothes and worn-out sandals. The situation in Venezuela means Colombia is now facing a humanitarian crisis on its border. 30 million to meet the needs of migrants and refugees.

7 million Venezuelans could flee this year alone, more than double the estimated 1. 5 million who left during 2014-2017. People wait to withdraw money from an ATM at a bank in Caracas on Feb. Crisis at the Border The streets of Maicao paint a desperate picture. Not far from where the handbags are made, a group of Venezuelan prostitutes shoot glances at passers-by.

At night, jalopies brimming with poor, exhausted migrants pull into town after hours spent snaking through the desert on one of more than 100 illegal trails. Border officials say they’re hearing reports of discrimination, sexual assault and violence along the illegal routes, including one young girl who filed a report saying she was sexually assaulted by armed groups on the trails and then forced to watch the execution of another migrant. A census is underway in Colombia to better profile the crisis. Still, the UNHCR says it has concerns about the increasingly invisible condition of these Venezuelans and emphasize the growing need to protect them.

How To Make Money During Hyperinflation

How To Make Money During Hyperinflation Expert Advice

Wage increases have lagged far behind the rise in costs of goods and services, those on fixed income or welfare will be the hardest hit by economic problems. That makes the absorption of poor, reasoned in their deflation forecasts. Store dried food, risk management techniques, the downdraft will continue.

How To Make Money During Hyperinflation

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In neighboring Brazil, the UNHCR has set up a shelter and nutrition response for about 50,000 to 70,000 who have already crossed into northern Brazil. But Colombia is bearing the brunt. That makes the absorption of poor, job-starved Venezuelan migrants a challenge for Colombia’s leaders. An estimated 550,000 Venezuelans have already crossed into the country. They lack a passport and therefore cannot apply for formal documentation here. The Colombian government provided around 170,000 passport-holding migrants with a special status that guaranteed them basic rights—including access to Colombia’s health services and the right to work. However, those without passports are left hanging in the balance.

Maduro’s government insists there’s a U. Behind the rhetoric, Maduro has raised the minimum wage three times this year and plans to launch new banknotes this June. He’s been sleeping on the streets since he showed up over a year ago. The money he makes off the bags gets split among his crew. Still, he’s afraid of getting caught. With a jolt of paranoia in his voice, he says he is risking 10-30 years in prison because it’s against the law to show the devaluation of the Venezuelan currency. It’s a crime against Venezuelan patriotism.

How To Make Money During Hyperinflation

How To Make Money During Hyperinflation

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Menu IconA vertical stack of three evenly spaced horizontal lines. Hyperinflationary episodes have appeared several times over the past century – 55, to be exact – as the world’s nations have experimented with fiat currencies backed by the full faith and credit of the governments that issue them. At times, that full faith and credit has been misplaced – and holders of unstable currencies have been caught empty-handed in countries all over the world. Often, this is can be a recurring theme among developing nations like those in Latin America during the debt crisis that struck the region in the 1980s. Even some of the largest economies in the world today, though – like China, Germany, and France – have suffered devastating hyperinflationary episodes.

How To Make Money During Hyperinflation Generally this…