Archive for March 29th, 2003

Farewell article by Alex Dalmady

March 29, 2003

Excellent and somewhat sad farewell article by Alex Dalmady explaining why he decided to leave Venezuela. As usual, Alex is poignant and incisive in his analysis. To those of you who did not know him, Alex started in the 80’s what became the standard reference for the Venezuelan Capital Markets: InvestAnalysis. He was a true pioneer in a thin field that I joined some years later. By himself, Alex produced, collated, organized and published copious amounts of well researched material on the local stock market and its companies and also became somewhat of an “enfant terrible” with his criticism of many of the most important publicly traded companies in Venezuela. He had to shut down his operation when the markets made his by-subscription-newsletter, simply unviable.

Alex is a great person to talk to, he tell is like it is, analyzes things in depth and always looks at all sides of the equation. I always enjoyed meeting him and talking about Venezuela, companies, technology or stock trading in the US markets (I remember Alex telling me about E Trade well before anyone even knew what on-line trading was all about.)

Like him, his farewell is unconventional. He clearly says it is not simply Chavez that he is running away from, he feels alienated from the majority of Venezuelans, not only those that voted for Chavez, but also those that run through red lights just because cars are not coming in the other direction. Obviously, the deterioration in the field of investment plays a role in his decision, but also the way the country is run. In one of my favorite sentences of the article he says : “The problems of Venezuelan macroeconomics is one of Algebra, not of differential equations. Less theory and more back of the envelope calculations”

Alex also talks about the varied reaction from people when he tells them he is leaving. I respect his decision, simply put, that is why I believe in free markets. At the end of the day, economic agents, whether large corporations or inviduals like Alex, make whatever decision they think is best for them and only them. To me, that is what drives the world and markets and is at the heart of economic behavior. Good luck to Alex! I truly believe that in the end, one only regrets those things that one did not do!

WSJ on Colombian guerrillas in Venezuela

March 29, 2003

<A href=",,SB104863555461196300-search,00.html?collection=wsjie/30day&vql_string=venezuela(article-body)”>Interesting article by The Wall Street Journal on guerillas cutting accross the border to Venezuela. (I believe it needs subscription to read it). Among the highlights:

“Colombian guerrillas operate at least two training camps in Venezuela and use the country as a launching pad for cross-border attacks”

“The documents offer no evidence that Venezuelan President Hugo Chavez himself ….In June 2000, Jesus Urdaneta, a former comrade-in-arms who had broken with Mr. Chavez, said that when he, Mr. Urdaneta, headed the Venezuelan state security force, Mr. Chavez had suggested backing the Colombian guerrillas with weapons”

“Venezuela’s foreign minister, Roy Chadderton, dismisses the drumbeat of accusations that have accompanied Mr. Chavez’s tenure as just so much speculation in the media. “We don’t see proof or evidence,” he says. He adds that “malicious” accusations are the work of Mr. Chavez’s political foes”

“Victor (also not his real name), who was a bodyguard for a top FARC commander until their December capture, says he was present when his boss worked out a deal with a local Venezuelan National Guard lieutenant allowing guerrillas to travel unmolested on the Venezuelan side of the Arauca River”

“It was the carnage of the Cucuta bomb that caused Colombia’s frustration with Venezuela to boil into the open. “We know [the guerrillas] have fooled the people and government of Venezuela ,” said Colombia’s president, Alvaro Uribe, after the blast. “They disguise themselves as good citizens”

Foreign Exchange control office hands out $30,000

March 29, 2003

For those that believe that Governments can do the job, the Exchange Control Office, CADIVI, finally handed out yesterday the first dollars under the new control regime. The grand amount of US$ 30,000 was handed out yesterday to students and “special cases”  only 67 days after the country stopped foreign exchange transactions. Of course, this is my biased view of the Governmnt’s icompetence, the Head of the Foreign Exchange Office explained that the delay was due to the fact that they are using “very novel technology”. Oh! that explains it.

Peace Actvist says he was wrong

March 29, 2003

Via Instapundit this amazing story of a peace activist who went to Iraq and realized how wrong he was about what local people felt about the war. Seems true, truly remarkable story.