The Haitian Currency is worthless due to Speculation and Instability
The financial system, regardless of the country, is always considered to be efficient. The same way that the stock market in the more developed world is based on speculation and stability, the financial system in Haiti is no different. It is based on offer and demand in an environment where a reasonable prediction can be made.
Actually, this is not the case in Haiti at this time. There are several factors that contribute to this unstable environment and ultimately affect the value of the Haitian gourde.
One, This is an election year and the political field is as uncertain as ever. Who can predict who will get into power in about six Months from now. What politic will the next adopt. Will it be pro business? The major players are having a wait and see attitude until the next president is elected or imposed.
Two, thanks to the PetroCaribe program with Venezuela, the Haitian government has been borrowing and investing in "Ti Manman Cheri", "Katie Pam Poze", etc..., a group of project that are very popular with those suffering; however, these project do put the country in o position to create wealth. Once the money is spent, the person is going to be hungry once again the next day with only one condition, this time the person is hungry and the country is in debt. The business environment can also anticipate that because of that, there will be a devaluation on the Haitian currency, they will look for security in the US dollar.
Three, the effect of government in transit. Another factor that often causes the Haitian gourde to decrease in value during the election period is government member securing their retirement. Some government officials are moving their money to a more secure place as the future is uncertain. Those former officials will likely move out of the country.
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