Saturday, August 28, 2021

Dollar: All is (un)quiet on the Lebanon front

Artwork by Tarek Chemaly

Apparently, the MP Kanaan is suggesting the Dollar parity in the banks has been increased to 10,000 Liras (up from the current 3,900), but the original parity (still used for flour and medicines if I am not mistaken) is still 1507 Liras, now the subsidy on petroleum and diesel products has been lifted and now they are imported at 8,000 Liras to the Dollar, all while the black market now clocks around 20,000 Liras. If you are still not yet confused, let us add the Central Bank's circular 158 which basically marks the Dollar at 12,000 while the "Sayrafa" platform check is at 16,000.

In consumer psychology, when you give the consumer the choice between 4 different types of Jam on the supermarket shelf, the possibility of buying is 50%. When the number of different jams is increased to 16, the buying possibility drops to 25%. I am not saying Lebanese politicians are versed enough in consumer psychology, but they are shrewd enough to know the dictum "divide and conquer" - hey, let's pit the people against the banks (once more) while making people really (really) confused about how much their Dollar is worth and in the process increase the volume of Lebanese Liras to make inflation even worse. This should occupy people for a while and get them off our backs. Neat trick if you ask me.

Still, to misquote Khaled El Haber's song:

نحن في لبنان يخير طمنونا عنكم

We are fine in Lebanon, how have you been?