What is happening in #Lebanon?
A thread about 🇱🇧
from an economic point of view.
Keep checking for future updates.
To read any past, present, or future economic event:
- don’t listen to the noise
- stop to breath
- zoom out to look at its history
- look for correlations
- look for similarities with other economies
- study how can #bitcoin be helpful
🔸Why was Lebanon known to have been Switzerland of the Middle East East in the late 60s to the early 70s?
👉🏼1 USD was worth 2.24 LBP (Lebanese Pounds)
Reference: LBP/USD exchange rate history is on the Lebanese Central Bank official website bdl.gov.lb/statistics/tab…
“the uninterrupted and continuous growth that began in the early 1950s was just as solid in the 1970s”
A glimpse to more economic facts of Lebanon’s economics before 1975’s civil war.
Reference: jstor.org/stable/41858277 By @AtifKubursi
The long lasting economic damage was the brain drain post 17yrs old war.
🔸 What happened then? Civil war started in April 1975 and lasted 17years.
How was the Lebanese economy when it ended in 1990 until the LBP peg to the USD in 1997?
According to @Investopedia “38 countries have exchange rate agreements with the United States and 14 have currencies pegged to the USD.”
I’m interested in understanding how a country gets its currency pegged to the USD. Especially that the LBP was pegged to the USD for 27 years.
Found this paper “Can the currency peg survive?”
by Derek Pinder, Taylor University, 15 July 2021
Ref centralbankbahamas.com/viewPDF/docume…
In the paper, The Mirage of Fixed Exchange Rates [aeaweb.org/articles/pdf/d…], the authors (Maurice Obstfeld & Kenneth Rogoff) argue that fixed exchange rates are extremely difficult to maintain and that most countries cannot sustain them.
Warlords been in power since 1975.
The LBP remained pegged until 2019.
🚩Bein a trade deficit country,
🚩of exports < its imports,
🚩a political enemy from the South & a country at war from the North/East
🚩hosting the biggest concentration of Syrian refugees in the world
= 💣
Reads to understand the geopolitical & economic situation of #Lebanon from 2019 - early 2022.
👇🏼
- forbesmiddleeast.com/industry/econo… by @OmarTamo19
- al-akhbar.com/Issues/274571 by @dan_azzi
- thegrayzone.com/2020/08/13/us-… by @BenjaminNorton
- alhoukoul.com/lebanon-s-revo… thx to @Louis_Allday
Yes, the Lebanese government and central bank are planning to devalue its currency to get an IMF loan.
Which is the standard IMF fiat play book protocol. And of course the govs play ball.
Short vid
YouTube
“However, the conclusion of the paper also notes that in a few cases specifically in tourist economies, oil sheikdoms, and heavily dependent principalities, fixed exchange rates can work.”
The Mirage of Fixed Exchange Rates [aeaweb.org/articles/pdf/d…]
🇱🇧 demographics are suffering.
#Lebanon 2021 Births vs Deaths & Divorces vs Marriages statistics were flagged by @LebUpdate.
I pulled the data from the official Lebanese Directorate for Civil Status site.
🔺2022 will be much worse.
🔺Impact is long term.
bit.ly/33HO5BZ
#Lebanon 2022 numbers based on today's USD to LBP exchange rate of 20,600 to 1$:
Monthly
🚩Minimum wage 33$
🚩Judge's salary 218$
🚩Soldier's salary 63$
🚩Lebanese University Professor 180$
Source
While technology costs should depreciate over time, telecommunications are skyrocketing in #Lebanon.
1 SMS = $1.25 (which used to be 10 cents)
🚩All SMSs are shared with governments.
Stop sending SMSs. Use @signalapp for more privacy.
🚨BANKRUPTCY NEWS
Lebanese Deputy PM Al-Shami announced that the state and the Central Bank of #Lebanon are bankrupt, indicating that these losses will be distributed to the state, the central bank, commercial banks, and depositors.
aljadeed.tv/arabic/news/lo…
🚩No official comment was issued on Al-Shami's bankruptcy statements, which indicate a deeper financial and economic crisis in #Lebanon, and may lead to sharp disputes between depositors and banks.
thenewsglory.com/the-lebanese-g…
Latest #Lebanon 🇱🇧 news
🅽🅾 F 🅱🆁🅴🅰🅳
🚩Lebanon imports at least 60% of its wheat supply from Ukraine tinyurl.com/pbb4jxjy
🚩national wheat reserves storage was destroyed on 4 August 2020 during the Beirut port explosion. It's not yet prepared. tinyurl.com/kpffxh22
The Lebanese don't know the taste of meat for two years. Which was ok for them. But now it's a whole different level of humilation❗️
You cannot secure a loaf of #bread for your mother, siblings, or children. In a country where the poor was relying on bread and water to survive.
The worst part of inflation is when the populations adapt to the crisis and continue accepting the fiat corrupt financial engineering.
Help others wake up.
Show them the exit.
Teach them about #Bitcoin.
#Lebanon
#BitcoinDuLiban
@BitcoinduLiban
⚡️Proud to see my fellow Lebanese Bitcoiner @Thomssmn (Host of @al3apodcast) writing about #Lebanon for the @BitcoinMagazine
Have a read if you're interested in Lebanon or Bitcoin, or want to know how Bitcoin can help.
bitcoinmagazine.com/culture/bitcoi…
🇱🇧 #Lebanon’s triple digits inflation year-over-year bypassed Venezuela’s.
The Lebanese Central Bank published a new note of 1million, circulating in Feb 2023.
Notes in larger denominations is a pure signal that:
- fiat is goin to 0.
- fiat has 0 chance.
- #Bitcoin fixes this.
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