In a strategic move, Chavez informally breaks relations with Colombia as the race heats up once again

November 28, 2007

Hugo Chavez broke relationships
at least informally today with Colombia, saying that a long as Alvaro
Uribe remains as President of that country; he will have no relations
with him. It was a somewhat dramatic end to the spat between Chavez and
Uribe, which began when Uribe decided to stop Chavez’ mediation into releasing some of the hostages in the hands of Colombia’s FARC.
 
While
Uribe used very strong words yesterday when he announced the end of the
mediation, Chavez got personal yesterday* in his response, calling the Colombian President a “sad pawn of the North American Empire”. Uribe was more indirect today, saying that
“Presidents have to respect their people rather than thinking about
vanities and anger”. But then, in what appears to be carefully
calculated words, Chavez made his new statement about relations between
the two countries.
 
Sp far, the statement has
not been formalized as policy as the whole reaction, like so many
delayed reactions in Chavez’ part, seems to be a carefully thought out
plan to gain votes on Sunday’s referendum. While the trends in polls
had been in favor of Chavez’ proposed reform being defeated on Sunday,
with the NO gaining ground with remarkable speed, this trend was broken
by the initial spat with Uribe last week. As I suggested in my previous
post, some pollsters had detected a reversal of the trend, which can
apparently be traced back to the incident between the two Presidents.
Remarkably, the popularity of both Presidents was actually boosted by
the bickering; as nationalistic sentiments were awaken by the conflict.  Thus, Chavez seemed to be looking for a quick fix to his weakling position in the polls.
 
While
the strategy has very negative consequences long term, Chavez’
immediate needs are more important. Colombia is Venezuela’s second most
important trading partner after the United States and provides many
basic foodstuffs at a time of widespread shortages with some basic
items.
 
At the same time one has to wonder
about whether the initial spike in popularity may be offset Chavez’s
stronger words now, particularly among the large voter population of
Colombian origin in Venezuela, but we are sure pollsters that are
advising the President have taken that into consideration.
 
And
as the date of the vote approached, activity picked up, with the last
opposition group siding with abstention, the “Comando de La
Resistencia” gave up its long standing stance against voting with a rigged system.
 
But
the largest “opposition” to Chavez seemed to be coming from Chavez’s
former supporters in Podemos, General Baduel and even his former wife,
who once again held a press conference, asking for forgiveness from the
people for the damage she may have caused by supporting her former
husband and calling the proposed reform treason and illegal.
 
But the most symbolic one may have been Baduel’s statement
in which Chavez’ former buddy and Minister of Defense not only charged
Chavez with changing the ideal of the Bolivarian revolution, but also
seemed to be talking directly to the military about their role not as
“arbiters” but to defend the Constitution jointly with the people.
Baduel called once again for people to vote No on Sunday and to go and
vote, trying to occupy in our minds the role as a possible figurehead
for “Chavismo without Chavez” in case the outcome on Sunday is not
respected, should the NO come out ahead. Clearly, the former Minister
of Defense had early knowledge of the surge in the NO and was trying to
position himself for the eventuality of a NO victory or the
interference by the Government with the results.
 
Thus,
with barely three days left for the vote, things continue to heat up
and strategies are being implemented with little time for preparation.
Tomorrow the “opposition” led by the student movement, closes its NO
campaign with a rally in Avenida Bolivar in downtown Caracas to be
followed on the same location the next day by Chavez and his SI
supporters. There will be no more polls that can be publicly released
and one can expect more violence, as well as more foolish decisions such as the Electoral Board opening an investigation on the church, while pro-Chavez campaign is outrageously biased in his favor in Government TV stations. 
 
By
now, whatever internal polls and trends may be saying, may be set in
stone in any case, as the most important factor, whether voters decide
or not to go to vote on Sunday, is what will likely tip the scales on
Sunday. Unfortunately, the Government has the resources, the tools and
the ability to coerce, which the opposition lacks, which may be enough
to tip the scales in its favor, even if the NO is ahead.

*While little noticed in the noise, Chavez “pawn” statement against Colombia’s President was made at an event celebrating the 15th. year anniversary nof the Nov. 1992 coup which Chavez supported, even if he was not able to participate as he was in jail at the time. This from the man who accuses everyone of plotting against democracy, while he celebrates such acts. Some democrat, no?


As things heat up, it looks like Hugo Chavez is trapped in a lose-lose situation

November 27, 2007


Things have certainly heated up in the last few days, almost as much as
the damaged power supply of the computer where my blog resides, certainly
sufficiently to justify an update and at least give you some perspective on how
I see things.

First of all, there is no doubt that Chavez has managed to irk some of
his former buddies, who while not outright supporters, at least had seemed to
achieve some form equilibrium with the volatile Venezuelan President. Both Spain and Colombia have
all of a sudden been frozen out by the autocrat, literally and diplomatically.
There is little I can add there, Chavez was clearly looking for some sort of
international success with the release of the hostages of the FARC, while Uribe
seemed to be allowing Chavez to fish for some quick fame as a way of having
some FARC leaders come out of hiding and capture them. In the end Chávez
got frustrated with the failure of his efforts and supposedly overstepped the
bounds of the established rules, causing the irkness of the Colombian President
who does not see the FARC, for historical reasons, as more than bloody
terrorists and enemies. Meanwhile Chávez is still asking for an apology from
the Spanish King for telling him to shut up, an apology that is certainly not
forthcoming in the King’s lifetime. There were also minor incidents with the
President of Chile, which suggest that Hugo Chávez is either on the edge or
getting ready to break up with the world or nervous about the upcoming
referendum.

And what once seemed, at least to me, like a sure thing, the approval of
the referendum on Constitutional reform, may be looking iffy at this point in
time. Both pro-Chavez pollsters and anti-Chávez pollsters are giving the NO
vote a lead, but the most startling aspect is without a doubt the speed with
which the numbers have changed. In less than three weeks, we have gone from a
YES lead, with large abstention, to a large NO lead in some cases, as voters
seem to be more interested in participating that they were a month ago. Quico has posted an excellent
summary of the polls here.

While the Government seems clearly nervous, as was shown by the strong attack
on the church today by the Vice-President accusing it of participating in
meetings to create disturbances, it is also mobilizing all of its resources and
blatantly violating all electoral rules. The TV balance present earlier in the
month is now non-existent and Chávez is trying to use the impasse with Colombia to his
advantage. Similarly, after opposition students announced their closing of the
campaign on Thursday, the Government said it already had the permits for that
day, but when the opposition said it would do it Friday, the Government
preempted them by saying they had the permits for Friday. Fortunately, the
students did not make a point of this saying they would move to Thursday as
originally planned.

In the end, the NO would need a huge lead to win, given the tricks up
the sleeve of the administration. To me, the SI still has the edge on the
ability of the Government to mobilize the vote. The No enjoys the advantage that
the turnaround in people’s sentiment has been quite dramatic and in polling
trends like that have to respected as they are quite difficult to reverse. However,
Datanalisis reportedly has a new poll from Nov. 24th. which showed
the trend reversing and the race now being close.

For Chávez the reversal has been quite dramatic and in some sense has
created a lose-lose situation for him, which has few political openings for him
to save the day. He needs a mandate to push his socialist revolution forward and
it certainly looks that he may barely get it. This will weaken him
significantly and he still has five years to go in his presidential term.
Losing would be devastating, as he would be left with no clear political
program going forward, at a time when discontent is growing fast.

Chávez can obviously withdraw his reform, which would make him look bad,
but may in the end be the best of all options. Other options such as suspending
the vote on legal grounds or arguing violence may be too contrived to work in his
favor.

In the end, the surge in the NO is something more than just the reform
proposal. The original Constitutional reform proposal by the President had
sufficient illegalities in it to make it questionable, but then the National Assembly
made it look even worse with the addition of 32 more articles and  a number of transient reform (which by the
way will not be voted on). Add to this the widespread shortages of basic
staples, inflation and the aggressive style by the Government and many people
are getting fed up with the unrealized promises of the revolution.

In the end the Government has forgotten the reform and turn the vote
into a plebiscite, it has become “YES with Chávez” as a way of trying to revert
the trend. He is an extremely good campaigner and will throw all of the power
of the Government behind the SI votes in the last few days. Unfortunately, the
same rush to vote that he thought would work to his advantage, may in the end
work against him as even a slim advantage will more likely be a defeat for the autocrat.


Forced to post lighlty

November 21, 2007

I continue to have system problems and will have to reinstall but need a code and they have yet to send it to me. Posting will be very light if at all during the Thanksgiving holidays, the pc is literally hanging by a threat to stay alive so I prefer to have it off so that it survives in the week leading up to the referendum. Things have been relatively quiet with Chavez abroad. There seems to be a war of polls with all saying the No is ahead, which I still don´t believe and the Government denying one poll, from its favorite pollster is true. We shall see…


Chavez, Ahmadinejah and pricing oil in dollars: Does it really matter?

November 18, 2007

We have all caught the controversy at the OPEC summit as to whether oil
should or not be priced in dollars. The controversy led by the
President of Venezuela and the President of Iran was left out of the
conclusion of the meeting, with Saudi Arabia refusing to consider the
issue.
 
I have actually wondered about this issue
quiet a bit and have read many opinions abut the subject to make sure I
understood it correctly and the answer seems to be that in reality it
matters very little whether oil is priced in one currency or the other
in the medium term, what matters is what currency oil exporting
countries are paid in and what currency they keep the proceeds in.
 
Whether
oil is traded on one currency or another is simply a matter of what has
been traditionally done in pricing the commodity. But the price of the commodity itself
has to do with the relative value of oil for the importers, supply and
demand, and its value is balanced by the movement of currencies. For
the US oil has gone up much more simply because in real terms, while
oil has gone up, Europeans for example, have seen it go up less due to
the appreciation of the euro with respect to the dollar. Traders
instantly go from one currency to another and determine how much a
barrel of oil is worth and that is what really matters.
 
What
really matters then, is what countries do with money received from
their oil exports. There are two very simple examples to this:
 
Case
1) Imagine the oil future markets announces today that all of oil will
begin trading in euros tomorrow. (A difficult proposition, OPEC could
set up an alternate market in euros, but let’s assume the extreme) In
reality, nothing will happen tomorrow, maybe a small psychological
downdraft on the dollar in the currency markets, but oil tomorrow will
begin trading at Friday’s close divided by whatever the euro rate of
exchange is at the opening.
 
Case 2) Imagine
that the oil exporting countries tomorrow announce that they will get
rid of all of their dollars and convert them to euros. In this case,
the dollar will suffer a huge drop tomorrow, which will have a strong
impact on the price of oil and that impact will be much larger than
changing what the futures markets do in Case 1).
 
Thus,
what really matters is what countries that hold the dollar reserves due
to oil exports do with their money. So the proposal the Iranian and
Venezuelan Presidents should have made, but couldn’t because it is none
of their business even if they understood the issue, is that OPEC
countries all decide to hold their international reserves in euros.
 
What
is interesting is that both Venezuelan and Iran seem to already have
done that, Chavez claiming it has switched most of Venezuela’s reserves
to euros and Iran reportedly having 85% of its reserves in currencies other than the dollar.
 
In
the end, countries should make of this a dynamic process, they should
not be making bets on whether the euro or the Yuan are going to
appreciate or not, that may be trading or close to gambling, but make a
rational evaluation of what the terms of trade for each country’s
economy is. That is, determine the various relationships each country
has in terms of trading partners and investments and then set your
reserves to a basket of currencies that best matches that. In this
manner, if currencies change there is no real economic impact on your
reserves.
 
The only real significance in having
oil trade in US dollars that is important to the dollar is that clearly
if you enter into an oil futures contract in dollars, during the life
of that contract, the amount of the contract is locked in to the US
currency. Thus, the amount traded in the oil futures market is in some
sense not available to be switched into euros and thus provides a
temporary stabilizing factor on the value of the US$. You could of
course, also hedge your currency buying a futures contract to preserve
the value of your future in the currency of your country.
 
Because
in the end, both President Chavez and Ahmadinejah are acting on their
political beliefs and the limited timing they have had as
“President-traders” in which the euro has done nothing but revalue
itself against the US currency since they have been Presidents. But
these things come in swings and the euro may be close to the end of its
run. Simply stated, it is the Asian economies that have become more
important in the world, not Europe. Europe has, in my opinion, economic
problems as important or significant as the US. Unemployment is worse
and its competitiveness vis a vis the US is diminished. Nevertheless,
the euro has revalued quite a bit, while Asian currencies have not
revalued as much because the Government’s of many Asian economies exert
some control on the exchange rate. But that is exactly the way Asian
economies have dealt with the increase in the price of oil: They have
revalued their currencies in order to reduce the impact on internal
inflation of oil imports.
 
There is additional
evidence that the euro has gone too far. Real State prices in Europe
are really getting out of whack. Apartments in downtown Stockholm go
for 14,000 euros a squared meter, in Madrid its 10,000-14,000 euros per
square meter and in Amsterdam, real state price recently hit its highest level ever adjusted for inflation,
reaching the equivalent value it had in 1736, destroying the myth that
real state always go up in real value and proving the wisdom that in
investments all we know that in the long term, we are all dead.
 
For
comparison, I just found in a website an apartment in Park Ave in
Manhattan that came to around US$ 6,000 per square meter, close to
Moscow prices (which are only slightly lower than New York) than to
those of large European cities.
 
This discrepancy
suggests that while the euro may be going up for little while, this has
little basis on fundamentals and the discrepancy is getting too large
to stay that way.
 
Thus, the President’s of Iran
and Venezuela, if they really understand the problem, are simply
playing with politics. And in the end, if the euro corrects, they may
be playing with fire, as this will severely undermine the international
reserves of both countries. Curiously, the two countries seem to have
very similar economic problems, perhaps because everything is done in
the name of politics and not on the rationality of economic thinking.


More Governments seem ready to join the King of Spain in telling Chavez to shut up

November 17, 2007

The above cartoon from a Spanish newspaper with the whole globe telling Chavez to shut up seems to be getting close to reality To wit:

1)US and Saudi authorities were mad at Chavez partnering with Iran to ask that the dollar no longer be used as the currency of choice for a barrel of oil.

2) The King Of Saudi Arabia opposes using OPEC for political activism as suggested by Chavez.

3) Chavez is demanding an apology from the King of Spain, which he will not get as opposition party Popular is saying the Spanish Government has been weak so far with Chavez.

4) Chavez violated Saudi law when he crossed himself during the Summit as well as naming Christ a few times. In the translation, Christ became the “prophet”

5) In Brazil, opposition groups not only are criticizing President Lula Da Silva for his support of Chavez, but are preparing a motion backing the King of Spain in the spat.

6) Colombian President Uribe reminded Chavez that he should not confuse saving the hostages in the hands of the FARC with a peace treaty with the FARC and warns he will have FARC leader Marulanda killed if he comes out of hiding..


May have to go off the air a few days.

November 17, 2007

The charger to the computer to where my blog resides just shorted. I will try to fix it, if it does not work, I will have to reinstall the software in another computer. This implies that my blog has to upload all of the five years of content. I did this once and it took like four days for it to be done, so the upcoming long weekend in the US may be the best time to do it. Fortunately I had a backup made last night and I noticed it on time, I seldom do. If the problem is fixed I will erase this message.

I managed a temporary fix, but the electrical connection is being held together by an alligator clip, so it is a temporary solution…


November 16, 2007

—Opposition students, the same ones that Chavez says are the kids of the rich, oligarchic and the like are leading
the student election at Universidad Central de Venezuela by almost a
five to one margin. We wish the middle class was that large!!!

A Bolivian Mayor disappeared
with US$ 45,000 from Chavez’ aid to that country. Either $45,000 is
more than I thought or $45,000 goes a long way in Bolivia. That money
may have been better spent here in Venezuela.

Note Added: The winning student opposition group called 100% opposition, appears tonight to have won ALL six seats of the student federation. By the way, this group was already a majority in that Board, including the Presidency. Thus, they seemed to have increased their popularity.

—PDVSA agreed to tender
for all of Cerro Negro’s bonds by the en of the year. Cerro Negro is a
heavy crude partnership PDVSA had with ExxonMobil and PDVSA will have
to pay capital, plus interest, plus a high premium of up to 14% for
doing this, just to satisfy the autocrat’s whims.

—Italy’s Parmalat sold its milk processing plant
to the Government of Venezuela for an undisclosed sum. The plant will
be run by one of these joint Government/Worker associations, which so
far have not done too well. But the more things fail under Government
intervention, the more the Government wants to intervene. According to the Minister of Foodstuffs,
the private sector has failed and thus the Government will have to
assume roles or spaces it never wanted. I guess this guy has not read
the proposed Constitutional Reform. Meanwhile and quote ironically, in
Belarus, they also blame Chavez for their milk shortage.

Vice-President Rodriguez says
that autonomous university authorities are concerned about the “parity”
of the vote proposed in the constitutional reform. Funny, he seems to
forget all of these authorities were elected, while not a single one of
the “Bolivarian” non-autonomous universities has elected authorities.
So, who is afraid of votes, parity and the like here?

—And while Daniel has shown
the picture below in his post today, I can’t help but comment for
completeness of my own blog on it. This is an article warning about
possible violence in today’s university elections at Universidad
Central de Venezuela. In the article, a pro-Chavez student is quoted as
saying that there is a fascist and coupster sector (opposition, of
course!), which is looking for violence and barricades. Then, the same picture I used last week
in my article on Chavista violence illustrates the article. The picture
corresponds to the pro-Chavez gunmen who shot at a peaceful group of
mostly women, protesting in Plaza Altamira on August 15th.
2004 and killed Ms. Maritza Ron. One of the points of my post was that
the Government could not come up with a gallery of violent opposition
groups, like I could easily do with pro-Chavez violent groups. I guess
the VEA article proves my point; they had to illustrate opposition
violence with a picture of their own. What a farce!


Venezuela: Oil, lies and simple math…

November 15, 2007

or why I am worried about the economy and so should be the Chavez Government

Yesterday, the Minister of Finance red jacket and all, held a press conference
to call the document issued by Fedecamaras “subversive”, because it
opposed the Constitutional reform. Cabezas proceeded then to tell us
how wonderful the economy is. I don’t know what bothered me most,
Cabezas attitude to a serious document, or the fact that the Minister
of Finance thinks everything in the economy is doing so well.

Because
I remember when Chavez staged his coup in 1992, one of the accusations
against the Government at the time by him and other involved in the
coup, was that it was focusing on macroeconomic numbers and not on the
realities.

And while Cabezas told us yesterday that the salaries of Venezuelans had gone up every year since
Chavez took over, he failed to tell us that inflation has been out of
control and that according to statistics from the Venezuelan Government
itself
, while salaries have gone up in Bolivars, in real terms,
Venezuelans are actually doing worse than in 1998 and they have been
running in place since 2002, despite oil prices shooting up a factor of
four in the period. So, if you are an economist like Cabezas you should
be concerned.

Then Cabezas told us about the
wonderful growth in the economy, but that is what you would expect from
the oil windfall the country has enjoyed in the last four years.

And
then today the Central Bank issues its report on the growth of the
economy and whether you are an economist or not it is quite scary.

First
the only good news, the Venezuela economy grew by 8.7% in the third
quarter of 2007 when compared with the same quarter in 2006, which is
the way in which such statistics are measured by the Central Bank. As I
said before, that is sort of what you expect.
Then,
you look into the numbers and find out that the non-oil sector grew by
9.7% and best sector was: the public sector! This grew by 12.8% and we
are told as if to sooth us that this only happened because the
Government nationalized CANTV and Electricidad de Caracas. Then you
read the fine print and find out that Communications grew a whopping
24.3%, commerce (yes, those wonderful imported things at the official
rate) grew by 18.4%, finance by 18% and construction, one of the
biggest drivers in the real economy barely grew by 4%. If that picture
is not worrisome to Cabezas he should have his name examined.

And then comes the shocker, the oil sector shrank, contracted or was reduced by 4.4%.

Now,
Minister Ramirez is telling us in his dual capacity as Minister of Oil
and President of PDVSA, that not only is oil production not declining,
but it is growing. Growing, because he says it is larger and he also
said that PDVSA has invested US$ 10 billion so far in 2007 to increase
production.

So, we are supposed to believe his
lies and those of his cheerleaders, but let’s look at one simple, very
simple number: the average price of the Venezuelan oil basket for the
last 21 months:
As you can see, oil
prices have been going up, in fact, the average price of the Venezuelan
oil basket in the third quarter this year was US$ 69.62 per barrel
according to PDVSA’s statistics and the same price in 2006 was US$
58.99 per barrel, an uncanny increase of exactly 18% year over year.
So, we are supposed to believe that the price of oil increased by 18%,
PDVSA invested US$ 10 billion in the first nine months of 2007 and oil
production increased, but somehow, magically or perversely, oil GDP
according to the Government controlled Central Bank shrank by 4.4%?

And
that is exactly why I am extremely worried, as Cabezas should be: This
growth is simply the result of increased Government spending and the
day the price of oil falls, it will be the day of reckoning. It is the
same oil boom and bust cycle, this time on steroids, It is in the end,
revisiting the Devil’s Excrement.

Maybe I should change the masthead of the blog by now:

For countries, easy wealth appears indeed to be the sure path to failure. Venezuela IS a clear example of that.

Chavez threatens Spanish investments over spat with the King. Is this now part of a larger plan?

November 14, 2007


From IBD, thanks. M!

The world got a good glimpse today of the Chavez Venezuelans have come to know and not precisely love, when despite calls by the Spanish Foreign Minister to normalize relations
between the two countries and put an end the verbal spat that began at the
Summit in Chile, Chavez turned around, asked for an apology from the
King and made vindictive threats against Spanish companies in
Venezuela.

The style was nothing new to
Venezuelans who have been treated this way for the last nine years, as
Chavez decides people are guilty by association or his enemies because they do not
take a stand that agrees fully with his positions. He then looks for
revenge in the form of either Government intervention, discrimination,
illegal treatment of those he has declared enemies and/or direct
revenge upon the persons or entities involved. It is in fact, the
history and style of the last nine years, from the discriminatory
Tascon/Chavez list, to the vindictive attitude towards opposition
leaders, former friends like General Uson or the most recent example
of calling his savior and former buddy General Baduel, a right winger and a
traitor.

Chavez first arrived in
Venezuela from Chile rsaying that he had not heard the King of Spain telling him to
shut up, making us wonder if he heard any of what Zapatero told him
about respect, the right to dissent and democratic attitudes. At the
time, Chavez added that the whole incident made him wonder if the King
of Spain actually knew about the “coup” in 2002, when Chavez left
office until Baduel rescued him.

Yesterday, Chavez showed he was actually quite irked,
boasting, in nouveau rich style, that Spain’s investment in Venezuela
were not indispensable, a sad statement given the state of poverty in
which so many Venezuelans live, which would be aided by any investment
as the Venezuelan state is incapable of going at it alone, as has been
shown over and over in the country’s history. Last night Chávez went
even further naming two Spanish banks by name (Which coincidentally
made multi-million illegal contributions to Chavez’ 1998 Presidential
campaign) as not needed by the country. He even included a call to investigate the
death of Simon Bolivar, a theory proposed by fascist and anti-Semitic
Argentinean “revolutionary theorist” Norberto Ceresole, a deceased
advisor to Chavez who claimed the Mason’s had killed Venezuela’s
Liberator.

Then today Chavez went all out,
demanding an apology from the King of Spain and threatening to get
vindictive and as retribution, take back properties nationalized by
earlier Governments and “put an eye” on Spanish companies operating in Venezuela.
Said
Chavez: “…Spanish companies will have to “We don’t want to damage them,
but at this moment I am subjecting the political, social and economic
relations with Spain under a profound revision…This means that Spanish
companies will have to begin to account for themselves…I am going to
put an eye on them to see what it is they are doing here… “Whatever has
been privatized can be taken back, we can take it back,” Chavez told
Reuters. “If the government of Spain or the state of Spain … start to
generate a conflict, things are not going to go well” Chavez also
called Spanish Primer Minister Zapatero “a fool”.

While
Venezuelans have been directly exposed over and over to this type of
behavior, Chavez has only used it against mostly US companies and
politicians in the past or Latin American Presidents who are not
aligned with his thinking. President Fox and Garcia of Mexico and Peru
suffered from his attacks, while you know who was called the devil at
the UN, while US companies were nationalized without so far receiving
any compensation for the joint ventures in the Orinoco Oil belt.There is simply no rule of law, just Chavez´ wishes, that is why he threatens some sort of special watch over Spanish companies as if they have been exempt from regular supervision because of their origin and thus, implying Venezuelan companies have indeed been watched over carefully. This is nothing new, as steel company Sidor, owned by Argentina´s Ternium was spared nationalization because of Chavez´close friendship with that country´s President.

But
what sets this apart is that the Socialist Government of Zapatero in
Spain and the Bachelet Government in Chile had been quite friendly and supportive of
Chavez and his political project since they were inaugurated in office.
But this changes the direction 180 degrees. In Chile, because Chileans felt
insulted by Chavez’ style upon arrival and his later charges that Chile
has made no social or economic progress and Spaniards because they feel
insulted by Chávez’ charges against Aznar in Chile and now against
Zapatero and the King.

Chavez’ threat today even
led some to believe that his reaction now may be part of a preconceived
plan. At least twice this year Chávez has threatened to nationalize the
banking system if they did not help in the development of his economic
and political project. It was always thought that the biggest stumbling
block to this would be his good relations with Spain and the strong
presence of that country in Venezuela’s financial system with three
very important institutions present: Banco Santander, Banco Bilbao y
Vizcaya and Banco Exterior. With the recent spat, Chavez could simply
say he nationalized the whole system and there were reasons of state for
doing so and it was not directed explicitly at the Spaniards.

In
fact, Chavez’ rush to approve the proposed Constitutional Reform is
related to all this. Last January, the National Assembly approved an
Enabling Bill, which allowed Chávez to legislate by decree for 18
months, which expires next year in June. A prerequisite for this was to
remove and add to the Constitution those limitations to the autocrat’s
political and economic project. Thus, the reform had to precede the
Executive branch decreeing the new laws. It may be no coincidence that
today Chavez happened to mention that he would issue one hundred laws by decree after the new Constitution is approved.

In
fact, I hope I have time in the near future to write about the fact
that Chávez is being given carte blanche to legislate by decree on
economic matters, under the proposed reform of the Constitution.

Thus,
the whole spat with Spain and its King has a lot to do with
Constitutional Reform. Chavez is not even worrying about Dec. 2nd.
he is sure he will win and he is thinking ahead to what he will do when
he has the new Constitution approved and it appears that removing the
Spanish banks from the picture may be an important part of his plans
for the economic and social future of Venezuela.

God help us!

Verbatim translation of a Presidential press release with my comments

November 13, 2007


Sometimes
things can get so bizarre in Venezuela
these days, that I feel I would do injustice to this press release by the Office of the Presidency that
I figured I should just translate the whole thing as if it was a Petkoff
Editorial or a good piece by someone else. However, I can’t help but make
comments about the things said in it, it is just impossible to resist!

“With a
biblical passage, the President of the Bolivarian Republic of Venezuela, Hugo
Chavez, responded to King Juan Carlos de Borbon about the incident that too
place at the Iberoamerican summit and emphasized that if he shuts up “The
stones of the Latin American people that are disposed to be free of all
colonialism after 500 years of colonization would cry out””

Comment
#1: Why is it that after 500 years we continue to blame our problem on
colonization? Who is trying to colonize whom right now? Isn’t Chavez the only
leader trying to spread hi “word and wealth” around the region? Does Lula think
he is not independent? Or Bachelet? Or even Kirchner? Did Bolivar lose the war
of Independence?
I just don’t think so…We are colonized by the Devil’s Excrement: oil, we just
can’t live with it and its negative effects.

“Upon his
arrival in
Caracas from Chile, the Venezuelan President remembered that
biblical passage (Luke 19,38-40) that tells us about Jesus entering
Jerusalem. At that point
someone asked him to have the people acclaiming him to shut up, but Christ
said:” if these shall hold their peace, the stones will cry out””

Comment
#2: While the reporter focuses on the people crying out, it would seem to me
that Chavez saw the analogy being the fact that He, the anointed one is involved, just as Christ was.
Nothing more, nothing less. The rest is simply fluff.

“The
President revealed that he did not hear, nor see the King I his irate gesture
and that it was the Nicaraguan First Lady, Rosario Murillo who told him what
had happened. “I did not hear him. It was Daniel Ortega’s wife (who told me),
because they were closer. And they tell me that he said, “Why don’t you shut
up, coupster?”, but the last word was not heard.”

Comment
#3: Did you see the video
here
? Chavez is looking directly at Spain’s Prime Minister Zapatero and the
King sticks his head in the line of sight Chavez-Zapatero and says his now
infamous words. How could Chavez not see him or hear him? Or is the problem
that he never hears others or he is quite used to ignoring them because he is so full of himself? As for being a
coupster, which may be your favorite epithet, but you certainly are the only
proven coupster in Venezuela’s recent history. Because if Carmona staged a
coup, the proposed Constitutional reform is much worse. Just ask your buddy
Baduel.

“The
President added: when Juan Carlos de Borbon explodes in the face of the
expressions of an Indian, they are exploiting 500 years of imperial arrogance,
500 years of royalty, trampling and 500 years of a superiority complex”

Comment
#4: Wait, wait. You did not see, you did not hear, but now you say he
“exploded”. And who is the Indian? Hugo Chavez? For God’s sake, now he wants to
be Indian and black, rather than the standard Venezuelan (80%), very mixed. In fact, have you seen his parents? Neither of them looks either
Indian or very black to me. I smell an inferiority complex here for some
reason.

“He
said that, had he heard the explosion of the monarch at an opportune moment,
maybe he would have said: “I will not shut up, nor will I shut up, because
millions speak through my mouth, we are the children of Bolivar, those millions
that are the kids of Guicaipuro and Manuela, Jose Leonardo Chirinos, all of
those that the Spaniards assassinated here, cut their heads and ambushed. He
should be glad I did not hear him.”

Comment
#5: Thereis that Jesuschrist projection again. But, either you are Indian or black, but Bolivar was as white (and Spaniard) as they got, and oligarchic
as they come. And jeez, if you are going to go back 500 years with your
inferiority complex, maybe we should go back to Creation and complain to God,
that it was just our bad luck that he did not give you a good baseball pitching
arm so that you would have realized your true dream and we would be talking
about your multi-million dollar contract instead of your bad boy antics.