El Paraiso: The body of Pedro Mandiel, 24, appeared this morning in El Paraiso. He had been arrested last night by police, according to leaders that support ousted President Manuel Zelaya, although officers assigned to the zone deny any participation in the homicide. Mandiel was one of the people among demonstrators that yesterday waited (on the Honduras border) for the return of Zelaya.
According to the those reporting the death, among whom are members of the Centre of Investigation and Promotion of Human Rights (Ciprodeh), Mandiel was detained for non-compliance with the imposed military curfew and this morning his body appeared at a refuse dump with signs of handcuff injuries on his wrists and torture on his body. He died of knife wounds.
On being consulted by foreign and Honduran reporters, a police officer said that the official police station register would be made available to prove that Mandiel had not been detained.
UPDATE: Zelaya says he's going to camp out at the border and wait for his supporters. Sounds a bit farcical to me. Hope it doesn't rain.
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Here's the fatalities chart and we're up to 390 deaths in South America.
Peru has given kids a extra week off school, thus extending the current break through to August 10th (nearly a month off when they normally get two weeks). Chile still leads with confirmed infections, up at 11,641. Argentina has stopped trying to count. Peru has 3,300 confirmed cases. Brazil chopped the number of flu deaths from 24 to 29 yesterday. Meanwhile, border towns in Uruguay are suddenly doing great business as Brazilians flock over, this because Tamiflu is only available under prescription in Brazil but is sold over the counter in Uruguay.
First up is 'Everything's Ruined', which combines melody, heavy rhythm, great lyrics and a spaced-out (American) dream sequence-like video.
So when the S&P500 went green a few minutes ago I had to check in with our friend the owl, who remarked....
...because apparently things like earnings and fundamentals don't affect stock prices any longer.
Troy Resources (TRY.to) down a penny at $1.28 but despite the still small volumes TRY.to has had an ok sort of week. At least it's traded every day for a change.
ECU Silver (ECU.to) down 6.9% at $0.54 on volume. No news to report apart from the fact that this company is a total and utter dog...and that's not news, either. Speaking of dogs....
Caerus Resources (CA.v) down 18% at 50c....people actually bought into the concessions news earlier in the week. Hopefully the money they lose will teach them a valuable lesson for the future.
Minera Andes (MAI.to) down 14% at $0.72 and a nasty surprise for longs this morning as MAI.to announced a round of financing at $0.75 that pummelled the PPS. I had to agree with our friend the owl this morning when he heard about the news and exclaimed....
...as there doesn't seem to be a need for this extra wodge of dilutive cash right now, unless McEwen is playing an insurance card to guard against lower metals prices in the pipeline. Anyway, as I'm long I wasn't very happy. Still not very happy, in fact.
"..there is, in fact, no foreign support for Micheletti outside the far right, mostly among Latin exile circles in the United States and well-heeled expats within Honduras."The truth spoken plainly. So, this week our coveted award goes to all those coup apologists that are frittering away what's left of their wholly useless lives by writing into IKN with racist, hate-tinged bile and self-justifications of what is nothing more and nothing less than a fascist dictatorship. Enjoy, dumbasses:
The news today took me back 14 years to a moment at Wembley Stadium when England played Colombia. Higuita has always pulled off wild stunts while playing (who remembers his dribbles to the halfway line?) but in the 22nd minute of the Eng/Col game saw Higuita pull off what was voted by fans last year as the best ever single moment in footballing history; The Scorpion.
Workers wanted a S/10 per day (approx U$3.30) pay rise and Shougang offered them a raise of S/0.70 (about U$0.25) per day. The workforce quite correctly took that as the insult it sounds like, downed tools and didn't cave in under pressure. Here's the final deal:
- A S/3.30 per day rise (approx U$1.10)
- A one-time bonus payment of S/1,300 (approx U$434)
- Meals supplied by the company for workers on duty
- Transport paid for (or partly paid for) by the company.
All in all, I think the Shougang workforce got themselves a good deal. Come the revolution, conmrades......
"....(economics) is subject to three critiques:1) It helped cause the current economic crisis
2) It failed to see it coming
3) It doesn't know how to fix it.
In my book, that doesn't leave much out. A theory that actively causes harm, can't prevent it, and can't cure it is not much of a theory.
Or more importantly, anyone know where the money is going to come from?
UPDATE: Niceman and reader 'FS' tells me it's from Eric Sprott's midyear conference call. Thank you kind sir.
UPDATE 2: Commenter 'TN' (below) nails the precedent as previous to Sprott. TY2u2:
John Maudlin uses the chart in a recent article 'Buddy, Can You Spare $5 Trillion?' He credits it to the 'friendly folks at Hayman', which is probably Hayman Advisors.
"I was watching the helicopter....I saw it...I was scared...the bullet hit me here...when it came there was nothing...that's what it seemed like...there was nothing....it came like this....it hit me here.....there was a lot of blood....some of my blood was on a woman...a bit of my blood was on her....I'm scared that they fired...I don't want them to shoot at me...because I don't want to suffer....for my mother..."
OH..YOU MEAN THEY FORGOT TO TELL YOU ABOUT GIRLS BEING SHOT AT FROM HELICOPTERS? OH HOW LAPSE OF YOUR MAINSTREAM MEDIA OUTLET. JUST AMAZING HOW THEY MISSED THAT STORY, ISN'T IT?
VIVA INVESTMENT GRADE. VIVA, VIVA, VIVA.
Update: Thanks to Rendon over at Gran Combo Club (gracias che), here's the video with English subtitles:
Colombia wanted investment grade from Standard & Poors...and didn't get it. S&P reaffirms the current BB+ rating, one notch under IG and one notch into junk.
However Colombia's bourse had a great day, up 2.7% on feelgood from the Dow plus Ecopetrol telling the world it had found a a very large quantity of oil in a field it shares with PRE.to. The new field has 500m barrels they say, which is officially known in the trade as a serious shitload.
Chile, and the latest opinion polls put the right wing Sebastian Piñera with a big lead over left wing Frei for the December Presidential elections...though "right" and "left" in Chile aren't that far apart anyway.
Honduras, And Mel is about to cross into the country at a place called "Las Manos". Could be a lotta fun, mojitos served and everything....and tear gas.
What you'll find in the sample edition:
- The 'This Week' preamble that tends to carry a few general comments
- A NOBS report on Lumina Copper (LCC.v)
- The 'Stocks to Follow' section, that tracks our preferred selections
- The 'Regional Politics' that in IKN7 gave an overview of Ecuador's situation
- The 'Market Watching' section, which tends to be a mixed bag, in IKN7 mused on copper, silver and ways to play the market while keeping risk down.
So download your free copy (here's the link again just in case) and if you have any further questions about the service, feel free to drop me a line.
I've just been mailed and asked
"What do reserves have to do with the parallel rate? Why does the amount of money in circulation affect the parallel rate?".Well we've been through this one before as well, but let's do it quickly. What follows is a real world explanation of something economists think is important, thus they normally dress it up in weird jargon and terminology that makes something pretty logical into something inaccessible (by the way, that's one of the reasons I like Krugman's blog; he's never afraid to put things into layman's terms and demystify his field).
In a country with a non-reserve currency (aka soft currency), the money circulating needs some sort of back-up. This is usually done by collecting a whole heap of dollars (or perhaps Euros, or perhaps gold) as reserves.
Imagine this: Say that one day the whole population of a country decides that it doesn't trust its currency any longer and decides to give them back to the people that made them, i.e. the Central Bank. So they form a long queue at the CenBank and the bank people swap the local currency for the reserves they have. In the case of Venezuela, the Central Bank is currently in the position to give out one dollar for every 6.82 Bolivares Fuertes (VEF) that are handed in. So, according to the equation VEF-vs-Dollar that the Central Bank operates inside Venezuela, U$1 should equal VEF6.82.
So after a while, the people waaay back in the queue get to hear that the bank is giving anyone a buck for each 6.82 VEF they hand in. So rather than wait a long long time for the five million or so people in front of them to get served, they start exchanging amongst themselves. And..errr...that's what happens in every exchange house and bank all over the world; people just cut out the hassle of turning up at the central bank and do the exchange thing between themselves.
Back to Venezuela, and this 6.82/1 rate held by the moneymasters (i.e. the CenBank, the people who collect dollars and issue VEF to the country) is currently accurately reflected in the actual permuta (parallel) rate. Normally it will fluctuate higher or lower than the theoretical line. This can be for various reasons, as there are other factors that weigh upon a currency exchange rate such as expectations of events to come, political (in)stability, macroeconomic forecasts of key industries (in the case of Venezuela, that means oil) etc etc. However in the long run the relationship of M2-Currency reserves is never that far out.
..showing the recent action, April 2009 to date. And what we see is another case of "not much happening". This morning the ask is at VEF6.82 for a dollar, by the way (much to the chagrin of dumbass doom prophets). But as is our wont, let's check out a couple of the main underlying fundamentals that explain why the permuta VEF is where it is. First the evolution of international currency reserves in Venezuela...
...and please note that this chart (for my own screwy XLS reasons) reads right to left. So right now Venezuela has U$30.69Bn tucked away in its reserves pouch. That's a tidy enough sum. However, the good news about reserves is outweighed by the bad news in the next chart:
As a quick reminder (we've done this one before) "M2" refers to the money in circulation in the country, both in the form of physical bills/coins and the money kept in the banking system (your savings amount desposit total, for example). In other words, M2 is basically "how much money there is in the country".
So in the above chart, we see that M2 has risen from the VEF equivalent of U$88Bn in April to VEF eq U$97Bn in July. People, that's a LOT. This means there's 10% more currency floating round Venezuela than there was just three months ago. M2 growth is acelerating since the last time we looked at it, from around 30% per annum to around 43%. This means that Venezuela will come under further inflationary pressure, sad to say.
But back to the parallel rate for a moment: Right now the rate stands at 6.82/1 and this is backed up by monetary theory. If we divide M2 by reserves and then multiply it by the official exchgne rate to get the VEF equivalent, the answer 6.82 pops, out, which is right on the button at the moment. However as the trend is for M2 to grow faster than reserves, the chances are that the parallel rate with continue higher and break 7 in the months to come.
Brazil's Real has been on a real tear, now under R$1.90 to the dollar. Ever since Brazil's top dumbasses-in-suits (you know them as 'economists') said the Real would finish at R$1.99 against the greenback...that was 3 weeks ago, y'knowz.
The whole story is pretty simple...local currencies will rally when the commodity complex rises (and let's not worry about higher material prices crimping industrialized nations' demand, eh?). For example, remember all that recent shilling about the Mexican Peso about the dive from 14 to 25 against the dollar? Here we are at 13.17...funny old world, innit?
Y'know, it'd really be fun to get a bit of comment from President Uribe of Colombia on this point. Because either;
a) Uribe is being quoted out of context by a manipulative liar (my best guess), or
b) Uribe can really and truly go and **** himself forever and ever, amen.
Peru's Central Bank said Wednesday that it had decided to reduce US dollar participation in the composition of its international reserves from 80% to 62%, due to fears of volatility in the US currency caused by the global financila crisis. Continues hereOr in other words, when the dumbasses in suits bail on the dollar the bottom must be in. Short the Euro now!
Mar Del Plata (Argentina's most popular coastal resort): Hotels with few reservations and low occupation rate. Buscompanies laying off drivers and subcontracted vehicles. Unlikely to break 50% occupancy rates through the winter break season. Restaurants offering cut price menus.
Bariloche (main ski resort): 50% fewer charter flights arriving from Brazil. Unofficial figures have hotel occupancy at 20%, despite good snowfalls and ski conditions.
La Leñas (number two ski resort): Foreign arrivals down 30%. More exclusive than Bariloche, officials insist that occupancies are at 95%.
Iguazú (the famous waterfalls on the Brazil border): 65% occupancies though "yesterday at 90%". People less worried about swine flu in this tropical zone. Most tourists arriving in own vehicles (approx 16 hours by road from Buenos Aires).
Córdoba (central city, popular for short breaks): "Apocalyptic panorama". "The season is lost. For us July is always the best month of the year but the (swine) flu has hit us hard, people aren't getting together and we have a lot of cancellations" says Jorge Piñiero, the president of the association of bars. Worst affected businesses are school outing and package tours.
Northwest Argentina (tourist route area from Catamarca through Tucuman, Salta and Jujuy): Occupancy rates at 66%, 15% lower than the norm. Local tourism suit Fernando García Soria says "The percentages aren't bad, considering the difficult context."
What follows was prompted by an e-mail exchange with a new subscriber (hi HF) who also owns DMM.to, and as is often the case the act of composing my thoughts helped me crystallize them. This is one of the many reasons why I like the e-mail feedback from you guys. So as DMM.to is one of the stocks I follow pretty closely, let's take a step back, have a look at a couple of charts and use them as a vehicle for comment on how the stock has performed recently. Firstly, here's the 12 month chart....
So if we zoom in and check the most recent action in DMM.to via this 10 day chart....
What will make things change? That one seems pretty simple, really. Those with a better understanding of the risks in Ecuador will just have to wait until the company starts posting strong revenue numbers and the naysayers are proven wrong. This will take a while.....we're talking months here, not weeks. but gradually, the ignorant about Ecuador will get a lesson in hard numbers. They'll be shown that miners can do business (good business at that) in the country and that's when the stock will move up. Until then we're likely to stay in the current holding pattern, which is ok, too. Sometimes investment do go boring which perhaps doesn't appeal to the MTV attention spans but it's fine by me. What about you?
.....the amount of cocaine confiscated in Bolivia by anti-narco forces, 2000 to date.
So the only question I have left is to ask why English language media continues to tell you lies about Bolivia. Any ideas?
Worth reminding you that the figures here aren't on rumours but on the official numbers published by each country's health authority.
Two Week's Notice, all academic and stuff. Greg Weeks knows Micheletti is a dumbass but is too polite to say so.
Latin America News Review, with Delacour getting it right nearly all the time on the issue.
Bloggings by boz, trying his very hardest to be neutral.
Capella Resources (KPS.v) down 36% at $0.43, but the scumbags will take this price as they're clear on their scam warrants at 15c and clear on their scam shares at 6c. The toothless impotent OSC sits by and watches it happen. Vomitworthy; this stock should be halted.
Orvana (ORV.to) down 2.9% at $0.68. ORV is back in the fight to take over Kinbauri, challenging ATW Gold with a $0.75 cash offer for the company. Also, note shady dealer Vic and his JFC.to vehicle is up today on volume. Worth checking out this JFC.to PR (ty reader M) and also the one today. Plenty of intrigue and movin'shakin' going on around this buyout fight now.
Troy Resources (TRY.to) up 4% at $1.30. Volumes tiny (natch) but plenty of action again in the stock overnight in Oz. Gotta love this one.
Vena Resources (VEM.to) up 11% at $0.40 and fighting hard. Good to see the resistance that VEM is putting up at this level, as every time it drops to the mid-30s it bounces back again. Volumes also low in Frankfurt and Lima today, which is more unusual than low trades in Canada.
So 23% and 22% are happy about the improvement in the Twobreakfasts government between 2007 and 2009, while 44% and 38% say things are ever worse. So how come all you hear about Peru is this economic miracle that's helping its population? Time to call bullshit on idiot foreign journalism in Peru, methinks.
- First you have a President with a background of extracurricular activities not normally associated with Catholic bishops (by that I mean he's into adult women more than the usual temptation traps) and with a child support burden to match.
- Then there's the recent data that has Paraguay as the world's number two producer of marijuana (ask anyone in Buenos Aires about the quality and they'll grin cheesily).
- And now a new scandalette, with Paraguay's ambassador to Chile caught with his pants (about to be) down at a bachelor party (photos from here).
This Armando Espínola dude in question, who is married to one very pissed off wife, is also famed for another sexy moment a few years ago when he was caught on camera checking out girly photos on his laptop while voting for a new law while a member of Paraguay's senate. He today resigned his diplomatic post in Chile and is presumably on his way back to sexytown Asuncion.
Now to be fair to Espínola, he said that the photos were taken years ago at a bachelor party and that someone had recently tried to blackmail him with the evidence.
When he refused, the presumed blackmailer went to the local Paraguay scandalrag 'Popular' to sell their wares. Darnit, there must be something in that tereré to get all these political hormones rushing about. Well, at least the guy had enough gumption to resign, not like that tosser Berlusconi in Italy.
We even had a news release to loosen up the volume from these shameless scumbags at KPS.v.
This is the most blatant and criminal scam of 2009. CEO Bachman belongs in jail.
According to latest LME data two unrelated players hold a
minimum of 80 percent of available copper warrants, and possibly
the entire 266,425-tonne stockpile between them.
Evermore pathetic El Comercio is lying through its teeth by reporting that only 30% of transport workers are adhering to the strike. The fact is that if you didn't commute early you're now stuck where you are in Peru.
Meanwhile, the 270-odd cases of industrial actions up and down the country get no press whatsoever....because we don't talk about these things, do we? Because Peru is a paradise of perfect development and social inclusion where the rich don't get richer without thinking of the poverty all around them first.
UPDATE: Twobreakfasts condemns the strikers, a sure sign of a successful strike. Jeesh what a dumbass.
Capella Resoures (KPS.v): Sauve qu’il peut
On Friday, Capella Resouces issued a PR (6) that said (main extract):
CAPELLA RESOURCES LTD. announces that the Company has received a total of $559,089.15 for exercise of warrants issued under the private placement of 12,933,330 units that closed on March 20, 2009 (the "Offering"). All Shares issued on the exercise of warrants issued under the Offering have a hold period expiring July 21, 2009.
As a small reminder, KPS.v is the company I featured on the blog as the worst scam I’d seen for a long, long time (7)(8) and at that point was in the process of carving up a new prospect for themselves and had excluded previous shareholders from sharing the booty by nefarious means. So what the above PR means is that the insiders that carved up the sweetheart placement in March (each of those units was a share at 6c and a full warrant at 15c and only friends and family were invited) have made about 30% of their 15c warrants whole and will be able to sell them on the open market as from Tuesday 21st July along with the other near 13m shares that come out of escrow (these share escrow period endings are important to keep in mind, as noted last week). As the stock is now at C$0.55 and the company has already said that, through lack of funds, it will not be drilling at its prospective Lajitas property in 2009, expect a large rush for a small exit as from Tuesday as the self-serving scumbag insiders try to get 18 million or so shares turned into cash.
I wouldn’t be at all surprised if the company issues a piece of seemingly good news this week that allows its insiders to sell into volume. Time will tell, but avoid like the plague whatever happens. Again, another ‘caveat emptor’ instance about the crooked ways of the Canadian market and yet again you hear my insistence on the importance of quality managerial teams.
You'll note we're not talking about an open market purchase or anything. Apparently these share came straight from company treasury and VEN.to would have to know about it. Except VEN.to didn't, according to the PR just published by Ventana. Here's the content:
RIO DE JANEIRO, BRAZIL--(Marketwire - July 20, 2009) - 63X Master Fund ("63X"), of Unlgand House, Grand Cayman, KY1-1104, Cayman Islands, announces pursuant to National Instrument 62-103 that it acquired ownership and control of 8,210,900 common shares of Ventana Gold Corp. ("Ventana") in a private purchase from Ventana from common shares in treasury. The common shares purchased by 63X represent in aggregate approximately 10.2% of the 80,382,000 issued and outstanding common shares of Ventana reported by the Toronto Stock Exchange and Bloomberg.
Prior to the share acquisition, 63X did not own any common shares of Ventana; accordingly, as a result of this acquisition of common shares from Ventana, 63X now exercises yada yada continues here
Ventana Gold Corp. (TSX:VEN - News) ("Ventana" or "the Company") has not sold any common shares of the Company to 63X Master Fund, ("63X") of Unlgand House, Grand Cayman, KY1-1104, from treasury, as announced by 63X this morning, or otherwise and has had no communications with 63X to date. The current number of issued and outstanding shares of Ventana is 86,600,131.So what's going on here? A crude attempt to move the market? Some communications breakdown? Sure smells fishy, whatever's at the bottom of this story. EBX even got the share count wrong, apparently. All rather weird.
Insulza tells it as it is: Honduras is on the brink of civil war, according to the man that pisses everybody off by turn (i.e. ain't nobody's lapdog, Hillary).
France tells Studmuffin that playing hardball with Perenco might harm future investments in Muffinland...Rafa then phones Sarko and mentions something about Argentina's new FinMin Boudou...which seems a bit of a non-seq at first.
Paraguay suddenly becomes LatAm's new fashion tourist destination as it's revealed it's the world's second biggest producer of marijuana. Bring your own Pink Floyd long-playing albums, oldtimers.
Machetera has the cool info in English right here and if the dude is on the Honduras Defence Ministry's list of suspects you can bet your sweet bippy that the DEA has the same intel, too (as Honduras milicos are owned by the US uniform dudes).
But hey, let's get real here. Being connected to cocaine smuggling cartels and being on US suspects lists never stopped anyone getting to be a President in LatAm: Just ask Pablo Escobar's Associate 82, a guy with the strange name of "Alvaro Uribe" who was a local politico in Escobar's area of main control back in the 1980's, was fingered by the Pentagon as being a "close friend and associate" but somehow managed to become....errr...president of Colombia.
"Be Prepared" as they say in Scouting Circles, and so the spin begins to prepare FinMin and Liar Luis Sponge Bob Carranza (that's a long name...we'll cut it down next time, don't worry) and give him an excuse as to why his 5%...no 4%...no 3.5%....no 3% GDP growth forecast is going to miss by a nautical mile.
But back to this swine flu GDP thingy, and I can't help noticing that if you subtract Yamada's 1.9% from SpongeBob's 3% forecast you end up with a number so very close to your humble servant's guesstimate made in April this year (1.28% for 2009). FinMin's probably preparing his Not my fault, sir! speech for Twobreakfasts already.
We got gold...
We got silver.....
We even got copper....
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