Chavez relection strategy - Venezuela raids stores in devaluation...

[WhiskeyGirl]

CARACAS, Venezuela (Reuters) - Venezuelan authorities backed by soldiers temporarily closed dozens of retail outlets for price gouging after a currency devaluation that triggered a frenzy of shopping but met with market approval.

President Hugo Chavez announced the devaluation last week, cutting the exchange rate of the bolivar against the dollar by half for oil income and for goods deemed nonessential in a move to bolster state coffers.

Thousands of shoppers have mobbed stores to snap up imported TVs and computers, worried their savings will lose value and prices will rise.

The problem?  With inflation, merchants won't be able to buy replacement stock with yesterdays price.

If a TV costs $10 and you're selling for $1, you won't have the $10 needed to buy the replacement stock.

Chavez is gambling he can underpin his 50 percent support with increased spending in the lead up to the election and offset the negative reaction price rises may bring.

http://www.caribbeannetnews.com/news-20831--12-12--.html

Is it really price gouging?  Or common sense?

The merchant needs to price his goods to make money AND restock his shelves.

For years, citizens have been going to places like Aruba to salt away money.  Probably glad they did.