Elections in Venezuela: A vote against what?
Why has the standard of living been going down in a country in the early stages of capitalism?
biz.yahoo.com
Sunday December 6, 8:14 pm Eastern Time
INSTANT VIEW - Populist Chavez wins Venezuela vote
CARACAS, Dec 6 (Reuters) - Venezuelan debt and American Depository Receipts are expected to open lower Monday following the election of populist front-runner Hugo Chavez in Sunday's presidential election.
Chavez, who led a failed coup attempt in 1992, has alarmed many investors with promises to review a portion of foreign debt payments, redraft the constitution and reorientate the expansion policies of the country's oil sector.
Monday is a holiday in the local currency and equities markets to celebrate the Immaculate Conception.
Following are the views of local and Wall Street analysts:
JOYCE CHANG, MANAGING DIRECTOR EMERGING MARKETS DEBT, MERRILL LYNCH
''A Chavez victory was largely anticipated. The debt market may open slightly weaker, but prices are already so depressed that there is no question of a sell-off unless the whole of emerging markets goes through a correction.''
''Following his recent moderate statements, the market will give him the benefit of the doubt. People will wait to see who is named to the cabinet''
''In the short term there could be as much as $3 to $4 billion at risk in capital flight in December. It really depends on what Chavez has to say.''
MIGUEL PURROY, DIRECTOR OF BANCO CARIBE
''The local stock market has already been discounting this for quite a few weeks, it may go down a little, perhaps up to 10 percent, but it will stabilize.''
''We are going to have some short-term difficulties finding financing and there will be few foreign investors willing to place their money in Venezuela for a while.''
PEDRO PALMA, ECONOMIST, HEPTAGON TRADING HOUSE
''It is not the end of the world. It was largely expected. Nevertheless, he has to transmit the right message to investors that their investments will be safe, and that democracy is secure.''
''The economy is in disarray. He will not be able to accomplish many of his promises. My worries are with his plan to implement a constituent assembly (to redraft the constitution) and the confrontation that this will bring with congress. I hope he knows how to handle that, or his government will become a circus.''
''I think his team will be forced to look to the IMF for financing and for moral support to win the confidence of the market.''
ALYCE ANDREWS, EQUITIES COUNTRY STRATEGIST MERRILL LYNCH
''I would imagine that stocks will fall some more on this. He's still too much of an unknown. If he comes out early and makes some strong statements the market could stablilize.''
''A lot of investors are going to wait at least a couple of months after he takes power (in February) before investing again.''
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