Tuesday, May 30, 2017

Goldman bought Venezuelan bonds, lifeline for Maduro (May 30, 2017)

Venezuela's opposition is accusing Goldman Sachs of propping up an unpopular government, after the bank confirmed the purchase of $2.8 billion worth of bonds, reports the Guardian. “It is apparent Goldman Sachs decided to make a quick buck off the suffering of the Venezuelan people," wrote National Assembly President Julio Borges in a letter to the bank's CEO. He also said he'd recommend "any future democratic government of Venezuela" not recognized the bonds' validity. 

The opposition had previously asked international financial institutions to avoid transactions that would help the government, notes the Wall Street Journal, which first reported the bond sale on Sunday.

Goldman said the bonds were bought on the secondary market, and involved no interaction with the Venezuelan government. The New York-based bank’s asset management division paid 31 cents on the dollar for Pdvsa bonds issued in 2014, "a lifeline to President Nicolás Maduro’s embattled government," reports the Wall Street Journal. The price represents a 31 percent discount to trading Venezuelan securities that mature the same year—and would imply an annual yield of more than 40 percent.

Venezuelan activists are calling for a protests of what they are labelling support of Maduro's "dictatorship," reports the Miami Herald. "If there were a gold medal for corporate social irresponsibility, it should be awarded to the Goldman Sachs investment bank," writes Andrés Oppenheimer, also in the Miami Herald.

News Briefs
  • Former Panamanian dictator Manuel Noriega died yesterday at 83. He was ousted in 1989, in what was then the largest American military action since the Vietnam War, notes the New York Times obituary. The Guardian traces Noriega's path from "valued CIA cold war asset and go-between in Central America’s dirty wars" to "a monster US spy bosses could no longer control." And another piece in the Guardian recalls the role of blasted rock music used by the U.S. military to get Noriega out of the Papal Nunciatura where he took refuge in 1989. "At the time, President George Bush considered the tactic excessive, but use of it only grew." The former dictator surrendered to U.S. troops in 1990, later spending time in U.S., French and Panamanian prison, reports the Wall Street Journal. The Miami Herald republished a report on Noriega's entry into a Miami jail that year.  Noriega later insisted he fell afoul of U.S. interests by refusing to permit the U.S. military’s School of the Americas to operate in Panama, and for the country to be used as a staging base for the Salvadoran death squads and the Nicaraguan contras, notes the Washington Post. Noriega was released from Panamanian jail in January, in preparation for brain surgery. "Once a feared dictator whose political enemies were liable to go falling from helicopters or be found headless in remote jungle clearings, Noriega had been reduced by the hardships of jail and the harsh vicissitudes of time to a palsied old man in a wheelchair in the final years before his death," reports the Miami Herald.
  • Colombian President Juan Manuel Santos announced the FARC will have an additional 20 days to disarm, and an extra two months to reintegrate into society, as delays beset the implementation of the country's landmark peace deal. Tomorrow was the original deadline for about 7,000 former fighters to hand over their weapons, and also the day the 26 concentration zones set up around the country were set to lose their special legal status -- though many camps remain incomplete, reports the Miami Herald. Key issues in the disarmament process include problems installing the shipping containers where weapons will be stored in the camps, and difficulty reaching isolated weapons caches in the jungle. In the meantime, delays notwithstanding, the country's homicide rate is at its lowest in decades, notes the piece.
  • U.S. Senators Patrick Leahy and Jeff Flake reintroduced a bill last week that would eliminate all travel prohibitions to Cuba. The bill, which only had 8 co-sponsors when it was originally introduced in 2015, now has the support of 55 senators from both parties, reports the Miami Herald.
  • Another U.S. bill seeks to strike a balance between farming states that want to export food to Cuba, and Cuban Americans who are still angry about property expropriated by the Revolution: a 2 percent user fee on agricultural products sold to the island that would be used to compensate those who have certified claims of properties confiscated by the Cuban government, reports the Miami Herald.
  • São Paulo's City Hall is seeking to intern drug addicts involuntarily, a strategy that has prompted the World Health Organization and the United Nations Office on Drugs and Crime to voice concern, reports O Globo. A court decision this weekend did not allow compulsory internment in treatment programs for people arrested in a crackdown last week in a city neighborhood known for harboring crack-addicts, Cracolândia. Experts dispute whether the strategy will be effective. Last week InSight Crime argued the problem has merely been displaced, as buyers and sellers move to new locations. (See last Friday's briefs.)
  • The crackdown has a certain resemblance to the eviction of Bogotá's El Bronx last year. (See post for Aug. 16, 2016.) A year after the Peñalosa administration's intervention in the neighborhood, two organizations of civil society criticize the local government for persecuting homeless people in the name of recovering public space, reports El Espectador. The 100 page report by Pares en Reacción y Acción contra la Exclusión Social (Parces) and the Centro de Pensamiento y Acción para la Transición (CPAT), denounce violent and excluding policies that violated the rights of people living on the streets, dispersed by last year's crackdown. (See May 15's briefs.) As "La Pulla" colorfully put it: the Bronx was split like a piñata, and now there's candy all over Bogotá.
  • Brazilian President Michel Temer insists he's not going anywhere, corruption scandal, rock-bottom approval and massive protests not withstanding. Data this week will show the country is emerging from a deep recession, and he plans to push ahead with key labor and pension reforms, reports the Wall Street Journal. Even if he is ousted, the economic agenda will continue, said Finance Minister Henrique Meirelles yesterday, according to the Wall Street Journal.
  • Several experts say it's not about whether he leaves before the end of his term in 16 months, but how, according to the Washington Post. Potential scenarios include impeachment, resignation, a judicially annulled mandate and a Congressional decision to call new elections.
  • Should Temer be ousted, his next in line -- and several following -- are implicated in corruption investigations of their own, reports the New York Times. Lacking in political options, Brazilians are increasing turning towards gallows humor. Running jokes about who should run the country include the national football team coach or citizens governing directly via Whatsapp. Yet the danger is real. The fastest-rising candidate in opinion surveys this year is right-wing populist Jair Bolsonaro, with a fondness for military dictatorship and abhorrence of homosexuality. (See May 24's post.)
  • Brazil's ongoing corruption crises represent an opportunity to root out entrenched graft, but could also be a threat to the country's political stability, argues a New York Times Interpreter piece. "... Experts worry that each round of allegations, prosecutions and impeachment ultimately weakens the political system and diminishes public trust. That makes it more difficult for the country’s political institutions to regain credibility and maintain stability.In other countries, similar situations have proved to be an opportunity for populist leaders who promise to throw the whole flawed system out and start over."
  • The current Brazilian crisis represents "graduation dilemma," argues Carlos Milani in the Conversation. "We argue that graduation is not a result but a process – one that requires making difficult foreign policy decisions that interact, in sometimes complicated ways, with domestic politics."
  • At least seven people died and tens of thousands were left homeless by flooding in Brazil’s northeastern states of Pernambuco and Alagoa, reports the Los Angeles Times.
  • Fact-checking sites are all the rage, but "it's a mistake to believe that they inevitably oblige politicians to speak the truth, correct ample citizen misinformation or eliminate false news from the internet," writes Silvio Waisbord in a New York Times Español op-ed. "Recent studies show the limited effects of verification. For example, it's unusual that corrections modify incorrect perceptions sustained by certain ideological groups with strong believes on various political issues. Preexistent incorrect perceptions are relatively armored against contradictory information. On the contrary, there are cases of "boomerang effect," when, far from modifying incorrect opinions, corrections strengthen false beliefs." In an era of false news proliferation, he advocates the importance of a commitment to truth. 
  • Media watchers in Ecuador hope newly sworn in President Lenín Moreno will follow through on promises to reform a polemic communications law used to launch hundreds of lawsuits against private media. He is expected to have a softer stance towards the press, and his approach will determine whether the country is indeed setting off in a new direction, according to the Guardian. (See last Friday's and Thursday's briefs.)
  • A young Mexican reporter who sought asylum in the U.S. after facing threats and harassment from corrupt cops was forced to return home after living in detention for 100 days and being twice refused bail, reports the Guardian
  • Thousands of people have taken to the streets in Suriname in recent weeks, protesting economic upheaval -- though few have paid attention, argues Rosemarijn Hofte in the Conversation. She links the Suriname situation with the Venezuelan protests, and compares President Desiré (Desi) Delano Bouterse to Hugo Chávez, also noting the parallel effects of the oil price decline.
  • Uruguay's regulated cannabis market is set to enter its final phase of implementation, with pharmacy sales of marijuana for registered users in July. While the legislation is among the most liberal in the world, cannabis activists say it also unfairly stigmatizes a substance that is less harmful than alcohol, reports the Guardian.
  • Martín Caparrós has a long lament about the Argentine decline over the past forty years, in the New York Times Español. Stories about our national decline are pretty much an Argentine national custom -- basically on par with ñoquis on the 29 and asado on Sundays -- but this one is a colorful read. 
  • A charming piece in the Atlantic reviews "One Hundred Years of Solitude," 50 years after it came out, looks at the factors that made the book a publishing blockbuster and brought "magical realism" into the world's lexicon. While it is "now seen as a story that speaks to readers around the world, One Hundred Years of Solitude was originally received as a story about Latin America," writes Alvaro Santana-Acuña. "Perhaps even more surprisingly, respected writers and publishers were among the many and powerful detractors of this novel."
  • A new book by a former Cuban CIA operative links the U.S. intelligence agency with JFK's assassination -- possibly a reaction to his "soft" stance towards the Communist-run island. In "Trained to Kill: The Inside Story of CIA Plots Against Castro, Kennedy, and Che" Antonio Veciana also recounts his attempts to subvert the Cuban government from within, stealing state money from the Che Guevara run Finance Ministry and using the money to fund attacks on government offices, security outposts, factories and warehouses, reports Newsweek.

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