Welcome to the Carnival of Latin America and the Caribbean. If you would like your links included please email me: faustaw2 “at” gmail “dot” com.
This week’s top stop stories:
Venezuela’s support of Hamas, and Argentina’s bleak economic outlook.
Last week Chavez expelled the Israeli ambassador to Caracas. Yesterday he was threatening to expel the American Charge d’Affaires in Caracas, John Caulfield, for going to a wedding in Puerto Rico. Chavez claims Caulfield was plotting against him…at the wedding.
Argentina’s economic outlook is bleak, and not likely to improve over the short term. While the country has been invited to the G20 summit and may be distancing itself from Caracas’s influence, government spending is out of control,
Argentina’s Ministry of Economics estimated in midsummer that the country was carrying about $150 billion in debt. The government has been borrowing from anyone who will lend — namely, the captive domestic bond market and regional ally Venezuela — at high interest rates to fund its populist programs, which include steep energy subsidies and the outright nationalization of six (now seven, counting Aerolineas) companies. Payments on Argentina’s debt will total more than $10 billion in the first six months of 2009 alone. At the same time, the government is assuming more and more responsibilities across the board and shows no sign of halting.
Because the 2009 government budget did not take the nationalized pension funds into account, it appeared at first blush that the government might have secured for itself some means of taking the bite out of debt payments with that appropriation. Given that the original budget was based on highly optimistic economic performance forecasts — the global downturn and the decline of Argentina’s agriculture industry notwithstanding –- it was possible to argue that the move was relatively prudent, despite the jitters felt by investors.
But the reality is that Fernandez is increasing spending at such a rate that the administration will quickly burn through the extra cash. This is not typical debt manipulation, but rather, as investors had feared, the outright commandeering of Argentines’ retirement savings to prop up the government’s populist policies.
Setting aside the emotional and financial impact to Argentine workers as they contemplate their futures, the government has ensnared itself in an accounting dilemma. If spending continues in the face of falling revenue and limited credit, Buenos Aires eventually will hit a wall. And so far, its only recourse has been to liquidate what few financial assets remain in-country. Although there could yet be a grand scheme that will compensate for this problem, the government has shown no evidence thus far that one exists. The odds of an outright debt default and a return to the economic crisis of 2002 are growing.
I’ll be talking about Argentina’s economy in today’s podcast at 11AM Eastern.
LATIN AMERICA
The world of the FARC (Part I: Europe)
The world of the FARC (Part II: America)
Battle for Influence in Latin America
Political Risk Bulletin from Market Memorandum
Spain’s Bets Sour in Latin America
ANTIGUA
Cuban-trained doctors in Antigua denied enrollment as medical practitioners
The Antigua Sun reported that the Antigua and Barbuda Medical Registration Board (MRB) refused to register the documents because, according to the Chairman of the MRB, David Dorset, the requirements were not satisfied that they could practice medicine by themselves.
Additionally Dorset said the applicants had not proven their entitlement to practice medicine in another country. Therefore, they would not be registered in Antigua and Barbuda under the Medical Act.
ARGENTINA
Housing in Argentina. Misery in their midst: A fight over an iconic shantytown
(Update) Argentine Bondholders Win $2.2 Billion in Judgments for Default
BOLIVIA
Sospechosa liberacion de narcos vinculados al MAS
COLOMBIA
Third term temptation: Álvaro Uribe pushes his luck
COSTA RICA
Death toll rises to 9 from Costa Rica quake
CUBA
Like Generation Y, Penultimos Dias got hacked.
Via The Real Cuba, Havana Cuba, 1930s
Cincuenta años de revolución cubana –2ª parte–
DOMINICAN REPUBLIC
Dominican Republic buys eight planes from Brazil
ECUADOR
Ecuador: Using OPEC Cuts to Take Over the Energy Sector
Ecuador is willing to talk with Colombia
Ecuador 14 January: The Studfather
More Financial Crimes Underway in Correa’s Ecuador
JAMAICA
Jamaican residents forced to flee homes in face of violence
MEXICO
Via Instapundit, New reports about Mexico, the failing state on our border
Ten of Mexico’s Most Notorious Drug Traffickers Extradited to U.S.
NICARAGUA
Ortega se apoya en Chavez y se enfrenta al mundo
PANAMA
Mail Going Outside of Panama
PUERTO RICO
Puerto Rico union leaders meet with Economic Advisory Panel
Puerto Rico expands coastal reserve
ST KITTS-NEVIS
Return of the noose: St Kitts has just hanged its first man for a decade and believes it is the only way to beat violent crime
VENEZUELA
Dictatorship for Dummies: Learn how to quash dissent Chávez-style.
Moneda virtual “Sucre” será aprobada en diciembre por el ALBA
Crece el apoyo a Chávez en el Medio Oriente
Government reduces travel quotas for Venezuelan residents Travelers can take out even fewer dollars in order to conserve its US currency reserves.
Israeli Ambassador Expelled from Venezuela
Israeli Ambassador Booted by Hugo Chavez
According to this report, the embassies are closing Las últimas palabras del Embajador de Israel antes de su partida
El Loco outreach suspended in Boston
AP: Turkey Holds Iran Shipment to Venezuela
Venezuela reducing oil to US refineries on OPEC cut
Via IBD: Drilling stops in 17 oilfields
The suspension affected oilrigs in Anaco, El Tigre and Campo Boscán
Crudo venezolano cerró la semana al alza con un precio de US$37.62
(Update) Venezuela Begins Stealth Devaluation After Oil Price Plunge
US POLITICS
Eric Holder and the FALN Pardons
10 Points for President-Elect Obama’s Latin America Strategy
Special thanks to Ada, the Baron, Eneas, Kate, Larwyn, Maggie and Maria.
These week’s posts and podcasts:
The Jews Face a Double Standard
Venezuela expels Israeli ambassador to protest Gaza offensive
Turkey holds Iranian explosives heading to Venezuela, transition purgatory, and other news items
At Real Clear World:
Argentina’s Outlook: Bleak
Bolivia Launches State-Run Media
Podcasts:
Tango
Latin America and Israel
Venezuela expels the Israeli ambassador to protest Gaza offensive, and other headlines from Venezuela
Humberto Fontova talks about the Cuban Communist revolution: 15 Minutes on Latin America
Argentina runs out of change: 15 Minutes on Latin America
Stuck on stupid, the Argentines. Do not Evita III and her consort realize that what ruined the Menem economy of 2000, and the inflation-ridden economies of the previous decades was EXCESSIVE GOVERNMENT SPENDING?
Repeat after me: EXCESSIVE GOVERNMENT SPENDING.
Tantos pelotudeces. Pardon my “French.”
It is also a lesson that the US will be needing to relearn.