It finally happened. Venezuela defaulted on its bonds. Bonds are considered one of the safest investments, but no investment is perfectly safe. Venezuela just demonstrated that. Venezuela also just demonstrated that collapsing economies can take years to collapse. The collapse was triggered by the collapse in oil prices and a supposed mis-management within the government. The bond default is only another milestone in a degrading economy. Foot shortages and inflation came first, and impacted households. The bond default now affects financiers and the organizations that relied on them. While “it’s increasingly unclear how Venezuela will support itself” the country somehow continues. Its continuation is a reminder that even massively dysfunctional governments can remain in power for years, or in the case of places like North Korea, decades.
Pretending Not To Panic 