Ecuador: When this fellow sings praises of an economy, then it is time to sell (opinion)

forbes.com/Tim Worstall: (opinion)

A useful little aide memoire is that when Mark Weisbrot starts to praise the economic policy of a country, then that’s a real good time to sell everything and run screaming for the hills. Toward that stock of shotgun shells and canned beans you’ve got for when it all really does start to all kick off. This useful little indicator is now flashing red for Ecuador as Weisbrot has a new report out telling us all how wonderfully the place is doing. Weisbrot’s story about Ecuador

….you’ve got to read a little between the lines to understand what has really been happening. Ecuador lives mainly from oil exports. And we’ve just been through the greatest ramp in oil prices in the history of our civilisation. And oil exporter should have been getting richer in such a time period. And that really is pretty much the explanation for what has happened.

THINKING OF MOVING TO ECUADOR – THIS IS ONE BOOK THAT IS A MUST READ

Except, of course, for the last little bit of it, the past year and two, when oil prices have collapsed. At which point the Ecuadorean government is running gargantuan budget deficits to keep the show on the road. Something that will only last for so long before the wheels come off, especially for a government that doesn’t issue nor borrow in its own currency–Ecuador uses the U.S. dollar. Read Article