Is

Venezuela’s

Maduro and His Cronies

Cashing Out?

In "Mysterious" Bond Sale, Venezuela Issues $5 Billion In Debt To Itself With China As Underwriter

“Taking place on Dec. 29 with no approval by the National Assembly and no promulgation notice in the Official Gazette, this smells of some kind of end of the year financial shenanigan from a government that is out of cash and is desperately trying to hide it,” he said in an e-mailed response to questions. 

Which is why China's involvement is hardly surprising: recall that the last time Venezuela arranged a direct loan from China was in March of 2015, when a similar number of $5 billion was also floated.  This time it appears that both Caracas and Beijing decided to be even more opaque in how China funds its vassal oil provider, with what likely amounts to nothing more than vendor financing - China funds Venezuela by helping it to issue a few billion in debt, meanwhile it collects tens of billions in crude oil pre-sold at a price that is particularly beneficial to China. 

With that assumption in place, we look forward to learning the details of just how China is now funding insolvent supplier sovereigns by the back door, and where else besides Venezuela is this arrangement in place.

DYI:  Speculating on my part - however who would be surprised if Maduro and company were to skim off the top and deposit at your local Caribbean or Swiss bank. Venezuela's economy is in a complete tailspin so if a coup arrives Maduro and cronies will have monies for a fast exit out of the country.  The Chinese are attempting to lock down very favorable prices AND exert more control over this beleaguered country. China is exerting itself in Panama and is only a hop, skip and short jump to Mexico.   

With all eyes on Russia; China is knocking on our back door.

 Is anyone listening?

DYI