Monday, August 31, 2009

ALL YOUR BASE ARE BELONG TO..... - Chavez Hypocritical posturing

Talk about arming a big brouhaha........Hugo Chavez complaining of US intervention, specifically the treaty to use Colombian bases.

The socialist leader called Colombia’s plan to host more U.S. soldiers a “hostile act” and a “true threat” to Venezuela and its leftist allies. He warned that a possible U.S. buildup could lead to the “start of a war in South America


shall we start with a couple of basics?

His invitation to Russia to "send ships, refuel long-range bombers and temporarily station anti-submarine aircraft in Venezuela", including the much publicized exercise held almost exactly a year ago with key parts of the Russian fleet

"Venezuela is a strategic ally of Russia. So let the Russian fleet come. It's welcome," Chavez basically invites a extra-territorial nuclear power to sail its main battle fleet into his waters, and says he welcomes them stationing personnel in Venezuelan bases.

Not to mention that Russia is the power selling sophisticated weapons to Chavez' dis-functional and corrupt military. This fuels a regional arms race. What is the purpose of all that offensive materiel? Venezuela has no real internal or external military threats - unlike Colombia which faces a ruthless insurgency that until recently controlled a lot of territory.

The most troubling part of Chavez arms buildup regardless of its origins, is that some of these weapons (i.e. shoulder-held Surface to Air Missles) can make it to Colombia, through coca-dollars or ideological sympathy. And Colombia is a country which does face an existential threat, the FARC.

The only "hostile" “true threat" to his neighbors is Chavez.

Thursday, August 13, 2009

Bernie Madoff, How did he do it?

for anyone puzzled about the Bernie Madoff ripoff, this Economist article and the NYT article on Bernie sidekick Frank DiPascali presents some basic info on key aspects of the scams. A complex Ponzi scheme, covered by loads of fake info cleverly designed to appear as legitimate trades.

Mr DiPascali was the main point of contact for investors, who ranged from Jewish charities to film moguls. He also oversaw the mechanics of the vast Ponzi scheme. It purported to be making steady, double-digit returns trading options on a share index. In fact, client funds sat in an account at JPMorgan Chase and were withdrawn only to meet redemptions or to be parked in Treasuries and the like. This was “nothing more than a slush fund”, according to the complaint against Mr DiPascali by the Securities and Exchange Commission.

Though there was no actual trading, the conspirators were far from idle. They cooked up phantom trading records, client confirmations and account statements to corroborate the fictitious investment strategy. They made thousands of wire transfers between the firm’s London and New York offices to make it look like it was earning commissions from real transactions.

Monday, August 10, 2009

Newsweek Says Latin America "Swings" Rightward

Interesting article in Newsweek Latin America Swings Right Not Left

First off, I am not so sure that there is anywhere near a general "shift" to the center and/or right in that very broad and generic "general" Latin American electorate as this article suggests.

But I do agree with the articles contention that the "Washington Consensus" approach is very much alive in many of the principal countries of Latin America. I have been saying that for a long time. Fact of the matter is that countries which are better off like Colombia, Peru, Chile and Brazil have continued policies that favor trade, fiscal responsibility, macroeconomic stability, foreign investment, private sector dynamism, and are much more succesfull than "Caracas Consensus" countries.

In the new Latin America, party affiliation and ideological inheritance may be heartfelt, but they are lousy compasses to the political future. And while neoliberalism and the Washington Consensus may be still be maldiciones below the Rio Grande, they are hardly dead or even out of fashion. In fact, with the exception of Mexico—whose fortunes are tethered to the faltering U.S. market—the nations faring best in the global financial downturn are those that have hewed closest to the free-market reforms that have proved so politically provocative. If onetime left-wingers are in charge in a dozen Central and South American states, most remain leftists in name only.