Tuesday, November 13, 2007

Verbatim translation of a Presidential press release with my comments Sometimes things can get so bizarre in Venezuela these days, that I feel I would do injustice to this press release by the Office of the Presidency that I figured I should just translate the whole thing as if it was a Petkoff Editorial or a good piece by someone else. However, I can’t help but make comments about the things said in it, it is just impossible to resist! “With a biblical passage, the President of the Bolivarian Republic of Venezuela, Hugo Chavez, responded to King Juan Carlos de Borbon about the incident that too place at the Iberoamerican summit and emphasized that if he shuts up “The stones of the Latin American people that are disposed to be free of all colonialism after 500 years of colonization would cry out”” Comment #1: Why is it that after 500 years we continue to blame our problem on colonization? Who is trying to colonize whom right now? Isn’t Chavez the only leader trying to spread hi “word and wealth” around the region? Does Lula think he is not independent? Or Bachelet? Or even Kirchner? Did Bolivar lose the war of Independence? I just don’t think so…We are colonized by the Devil’s Excrement: oil, we just can’t live with it and its negative effects. “Upon his arrival in Caracas from Chile, the Venezuelan President remembered that biblical passage (Luke 19,38-40) that tells us about Jesus entering Jerusalem. At that point someone asked him to have the people acclaiming him to shut up, but Christ said:” if these shall hold their peace, the stones will cry out”” Comment #2: While the reporter focuses on the people crying out, it would seem to me that Chavez saw the analogy being the fact that He, the anointed one is involved, just as Christ was. Nothing more, nothing less. The rest is simply fluff. “The President revealed that he did not hear, nor see the King I his irate gesture and that it was the Nicaraguan First Lady, Rosario Murillo who told him what had happened. “I did not hear him. It was Daniel Ortega’s wife (who told me), because they were closer. And they tell me that he said, “Why don’t you shut up, coupster?”, but the last word was not heard.” Comment #3: Did you see the video here? Chavez is looking directly at Spain’s Prime Minister Zapatero and the King sticks his head in the line of sight Chavez-Zapatero and says his now infamous words. How could Chavez not see him or hear him? Or is the problem that he never hears others or he is quite used to ignoring them because he is so full of himself? As for being a coupster, which may be your favorite epithet, but you certainly are the only proven coupster in Venezuela’s recent history. Because if Carmona staged a coup, the proposed Constitutional reform is much worse. Just ask your buddy Baduel. “The President added: when Juan Carlos de Borbon explodes in the face of the expressions of an Indian, they are exploiting 500 years of imperial arrogance, 500 years of royalty, trampling and 500 years of a superiority complex” Comment #4: Wait, wait. You did not see, you did not hear, but now you say he “exploded”. And who is the Indian? Hugo Chavez? For God’s sake, now he wants to be Indian and black, rather than the standard Venezuelan (80%), very mixed. In fact, have you seen his parents? Neither of them looks either Indian or very black to me. I smell an inferiority complex here for some reason. “He said that, had he heard the explosion of the monarch at an opportune moment, maybe he would have said: “I will not shut up, nor will I shut up, because millions speak through my mouth, we are the children of Bolivar, those millions that are the kids of Guicaipuro and Manuela, Jose Leonardo Chirinos, all of those that the Spaniards assassinated here, cut their heads and ambushed. He should be glad I did not hear him.” Comment #5: Thereis that Jesuschrist projection again. But, either you are Indian or black, but Bolivar was as white (and Spaniard) as they got, and oligarchic as they come. And jeez, if you are going to go back 500 years with your inferiority complex, maybe we should go back to Creation and complain to God, that it was just our bad luck that he did not give you a good baseball pitching arm so that you would have realized your true dream and we would be talking about your multi-million dollar contract instead of your bad boy antics.  9:41:10 PM    comment []

New website with great presentations on our electoral problems past and present Somebody sent me the link to this website devoted to the Venezuelan Electoral system. It is well done and there are over 20 presentations on the problems of our electoral system, including evidence of fraud, problems with the electoral registry and the like. A lot of the material complements or explains with voice and slides, some of the stuff found in my RR Models section. Unfortunately, it is only in Spanish. 8:29:04 PM    comment []

Government sells US$ 1.5 billion in bonds at exchange rates at least twice the official rate According to the Government spokesmen, including the Minister of Finance, the parallel foreign exchange market is either irrelevant or non-existent, depending on whom you talk to. We are told that it is tiny, less than 5% of imports at times. Other times, we are told the Government does not care what happens to it, because it is irrelevant. But reality says otherwise. When you don’t know whether something has been purchased with official CADIVI dollars or not, there is room for profit and when the foreign exchange office CADIVI is slow to approve funds, importers are forced to go to the swap market, which is quite legal as the swapping of securities is explicitly excluded from the exchange control illegalities Bill. But there is another reality: The Government has either issued or sold to the market some US$ 13.5 billion in securities so far this year, in order to keep this “irrelevant” market down. This does not include the structure notes sold to the local banks, because little is revealed as to who buys them, how much and why some and not others. Now, to give you some perspective US$ 13.5 billion represents 38% of what the foreign exchange control office has approved so far this year. Of course, the Government has sold all sorts of instruments, including bonds denominated in dollars at the official rate of exchange, which are hybrids and some, very few Bolivar denominated ones. But the dollar fraction is at least 30% of it, to which you have to add the actual swap market. Now, the official rate of exchange is Bs. 2,150 per US$, but these sales by the Government to help maintain the parallel rate down are done at a rate above the official rate and below the parallel swap rate. Today, the Government announced the allocation of its latest effort to fight the "phantom" parallel market, a US$ 1.5 billion issue composed of two Bolivar denominated bonds or Vebonos and a dollar denominated bond, which matures in 2038 and has a 7% coupon. The bond was named Venezolano I, since it had no Argentinean component like three of the bonds sold in the last twelve months. For the first time ever, the Government used an auction system, even if it had a slight twist. Basically people could put in their orders at any price and they would receive the bond with dollars valued at Bs. 2,150. People will turn around tomorrow, sell the bonds and effectively they will be buying dollars at a higher rate than the official one. How much higher? Well, the results of the “auction” are such that those that bid over 136% for the bond will get 100% of the amount requested. At 136, the effective price for each dollar obtained is roughly Bs. 5,400 per dollar. Thus the Government is tacitly selling dollars at a rate, which is way over twice the official rate of exchange. Those requesting between 122 and 125 got 20% and between 125 and 135.99 got 35%. Thus, at the lowest end of the scale, people paid Bs. 4,500 per US$, still twice as much as the official rate of exchange. The non-existent parallel market has been around B. 6,200-6,300 lately. Thus, the market that does not exist, that “mediatic” instrument used by the opposition to destabilize, received a healthy dose of foreign currency by the Government today and there are promises that the Government will sell into it some US$ 600 million in the remainder of the year. Unfortunately, at best, this will keep the swap market constant, due to the pent up demand, nerves and the high monetary liquidity, in this virtual and supposedly non-existent market. Just the Government validating prices around the Bs. 5,500 level will set that as the ultimate lower floor for the time being. 12:49:08 AM    comment []