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Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Paul Berliner who wrote (1167)	1/20/1999 4:40:00 PM
From: X Y Zebra	Read Replies (1) \| Respond to of 3536

Thanks for the news Paul, very enlightening... Although Brazil's woes have exacerbated the sucre's problems, the troubles really began at the beginning of the month when the government began implementing a 1% tax on all banking deposits and transfers, intended to generate $600 million per year. When will they ever learn... I guess a famous bank robber already said it: "I rob banks because that's where the money is" (I forgot the illustrious author of the above quote). Of course, I would not compare a politician to a common thief! --President Jamil Mahuad is expected to go to Congress next week and present the 1999 budget. According to a recent interview, the budget will be near $5.5 billion and not the $5.1 billion previously mentioned. Although the government hopes to keep the fiscal deficit under 4% of GDP, Mahuad has admitted that finding financing is tricky. Ha ! He is not looking in the right place..... Perhaps he should bundle a package of mining companies with some tourist fringe benefits for investors, then go to Vancouver (BC) and issue some penny stock market "fleas".... One would think that with the abundance of "investors" in the penny market, such proposal would not be all that crazy, you would achieve several things: 1. "Investors" would at least be compensated for their "wisdom" with some travelling and geography lessons, (they would learn where Ecuador is, and what is their currency). 2. Creative use of the IPO proceeds may actually yield some benefits for the Ecuatorian economy. (Not to mention the possibility that actual and real investors may go to Ecuador and invest in real projects... 3. Relief for the Ecuatorian tax payer, (that's always good with the electorate). 4. Maybe even set some example that other countries may follow... 5. At worst, the "investors" may be compensated for their efforts from the altruist point of view. (as opposed for only being taken for a ride by some unscrupulous penny stock promoter... That's assuming the local politicos do not run away with the loot... er, the financing proceeds). KEY INDICATORS: $/sucre 7,270 (Jan 11) 4,498 (Jan 1998) FX reserves $1.6 bln (estimate) $2.093 bln (Jan 1998) CPI monthly 0.8% (Dec) 4.0% (Jan,1998) CPI annualized 43.4% (Dec) 27.7% (Jan, 1998) Trade balance -$880 mln (Jan-Nov 98) $594 mln (Jan-Jly 97) Do you think Bill Gates may be interested in buying Ecuador ? He could move there (and Microsoft with it), improve things a bit for Ecuador, get rid of the DoJ mosquitos, and launch his bid for the rest of South America from there... it is centrally located.