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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Box-By-The-Riviera™ who wrote (5321)	12/20/2001 11:13:19 AM
From: John Pitera	Respond to of 33421

good point Joel, Argentina has had a state of seige the past few days, and I see that a judge has ordered Cavallo not to leave the country.. Lots of problems down there. ------------------ December 20, 2001 Americas Argentina's Economy Minister Resigns; Nine Killed in Anti-Government Protests Associated Press BUENOS AIRES -- The economy minister resigned Thursday as the nation's financial system teetered on the brink of collapse. A judge forbade the minister from leaving the country. Nine people died as protests and looting extended into a second day. At first light, about 100 people gathered outside the government house, banging pots and pans as a riot police were soldier-to-soldier guarding the seat of power. It was a smaller version of earlier protests countrywide against President Fernando de la Rua's measures to quell demonstrations and to decry his and Economy Minister Domingo Cavallo's handling of the economy. A federal judge issued an order prohibiting Mr. Cavallo from leaving the country. The judge, Julio Speroni, is investigating an arms-trafficking scandal from the 1990s when Mr. Cavallo served in the government of then-president Carlos Menem. The judge did not explain the reasons for the order. Banks reopened and people went back to work on what began as a calmer day, with little police presence on the streets. But many small shops remained shuttered for fear of further unrest. Mr. Cavallo, widely blamed for failing to halt the nation's slide into economic ruin, offered to resign Thursday. The state news agency TELAM said Mr. de la Rua had accepted the resignation. "We're fed up with corruption, hunger and the poverty we're living in," said Ana Arce, a 75-year-old doctor, outside the government house late Wednesday. "I think that if they don't go, the people will kick them out." Unemployment has topped 18% in South America's second-largest economy. Mired in a four-year recession, the nation is near default on its staggering $132 billion public debt. On Wednesday, thousands of Argentines looted stores and supermarkets in poor neighborhoods, saying they were going hungry. Riot police responded with tear gas and rubber bullets. The violence left nine dead and at least 109 injured. Police made 328 arrests. "This is not our fault, this is the government's fault, the president's and Cavallo's," said Sandra Guttierez, a 28-year-old unemployed mother of two, who left one ransacked supermarket loaded with bags of food Wednesday. "We feel we've got no future, for us or for our kids," she said. Austerity measures introduced by Mr. Cavallo, including a partial freeze on bank withdrawals designed to prop up the financial system, have sparked widespread anger, especially in poorer areas. In a televised address Wednesday night, Mr. de la Rua said he was imposing a 30-day state of siege to guarantee order. "I urge those who are exercising violence to cease such acts," Mr. de la Rua said. "With violence and illegality, we will not solve our problems." 1Cavallo Unveils Leaner Argentine Budget in a Bid to Persuade IMF to Release Aid (Dec. 18) 2Buenos Aires Scrambles to Cover Obligations After Denial of $1.3 Billion IMF Rescue Deal (Dec. 7) Wednesday's decree marked the first time in 11 years an Argentine president has seized special powers that effectively grant security forces greater powers of arrest and allow them to ban public gatherings. Such measures were last used by Carlos Menem -- Mr. de la Rua's Peronist predecessor -- in 1990 to quash an uprising by a right-wing antidemocratic militia group. A year earlier, a state of siege failed to stop widespread looting and social chaos that eventually forced then-president Raul Alfonsin out of office. But Mr. de la Rua's emergency measures only provoked more anger. As the protests swelled around government house and the presidential palace, where Mr. de la Rua's cabinet was meeting, the government's future appeared to hang in the balance. Outside the residence, crowds of thousands gathered shouting "Cavallo out," also calling for Mr. de la Rua's resignation. Thousands more thronged the central Plaza de Mayo at the Casa Rosada government house, until riot police charged them, firing tear gas. Others rallied outside Mr. Cavallo's home on Libertador Avenue. "It's great that Cavallo's gone," said Elena Sicilia, an actress rushing toward government house after hearing about the minister's resignation on television. "But they all have to go, we don't want de la Rua and we don't want Menem back. We want a fair government of the people." Sick for years, the economy has nosedived during Mr. de la Rua's two years in office. His government has tried to fix the economy with nine different economic plans and has faced eight general strikes. Until Tuesday, Mr. Cavallo had been working on enacting another punishing austerity plan, pushing a belt-tightening 2002 budget through Congress and staving off a default on Argentina's staggering debt. Rising social tensions are expected to make it more difficult for Mr. de la Rua to push 2002's austerity budget slashing an extra $4 billion in public spending through Congress. Agreement on the budget is seen as key in persuading the International Monetary Fund to release $1.3 billion of emergency funds that cash-strapped Argentina needs to keep up payments on its debt. Failure to secure IMF funding could lead to a default, which would probably spark more chaos and social unrest. In his speech, Mr. de la Rua called for a broad political consensus to assume the "historic responsibility" of pulling Argentina back from the brink of economic and political collapse. But he made no concrete proposals.