Monday, 2 February 2009

Earlybird, Feb. 2, 2009

The headlines are:

COLOMBIA -- Uribe Leaves Option Open for Second Re-Election (Click here for link to Tiempo story): This soap opera is becoming more and more stressful for Colombia. We might need first to read the real meaning of the release of the seven FARC hostages, its impact on the political scenario, but for sure Uribe has a few aces ready if either his coalition fails to reach an accord on a single candidate, or the opposition gains ground in polls for the 2010.

MARKETS -- Protectionist Wave Likely to Hobble New Lending (Click here for link to WSJ story): We have mentioned this in this blog a few times. According to the opinions of several economists we have quoted on the subject, the passage of protectionist measures, especially in financial rules, may lead to a significant drop in investment into emerging market nations, ehhmm, Latin America specifically.

CHINA -- Government Partially Scales Down Censorship of Foreign News (Click here for link to WSJ story): Well, this is obviously one of the stories that stemmed from the years of abundance where any government did whatever they wanted with investors. Xinhua, the Chinese official news agency was both a regulator and a market competitor to the WSJ, Bloomberg, Reuters ... Only a complaint filed by the U.S. to the WTO prevented rules to be more stringent. Let's not expect the Chinese to give up on this one.

BRAZIL -- Alcides Amaral, Former Head of Citigroup in Brazil, Dies (Click here for link to Estado story): A big loss for the Brazilian financial industry.

ARGENTINA -- Retail Sales Plunged in January, Recession (Click here for link to Nacion story): We heard rumours (yes in Cartagena at the Hay Festival, from some Wall Street people) that the Argentina government was thought to be cooking the GDP data books. The economy should already be in recession ... but the government of Mrs. Cristina Fernández de Kirchner refuses to acknowledge it.

U.S. -- Obama Plan Faces Risk of Failure. Two Goals May Be Too Many (Click here for link to NYT story): In economics school you learn to set one objective as goal for economic policy. In this case, the Obama administration, as this article suggests, is aiming at two: reform and recovery. The probability of failing to attain both are growing by the day.

VENEZUELA -- Currency Regulatory Commission Might Impose Further Travel Restrictions (Click here for Universal story link): More red tape might stretch out the agony a little bit but, at some point, the government will have to respond with a measure that puts an end to the growing balance of payment imbalances. Imports are growing too fast -- the reason? The exchange rate is simply too cheap.

VENEZUELA -- Markets, Government Offices, Schools Closed to Celebrate ... Chavez's 10th Anniversary in Power!!! (Click here for link to El Universal story): This is the no-comment of the day.

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