February 10, 2007  Recently this site called for an annulment for Ecuadoreans from their adolescent Princeling, Rafael Correa's marriage of convenience to Hugo Chavez's utterly corrupt regime. It seems that an annulment is no longer in order and a Bill of Divorce must be sought before this marriage of convenient thugs and drug runners consummates their final act of regional supremacy under the Chavez and Correa constitutional realignment, also called a constitutional referenda for Ecuador.

We say that Ecuadoreans must interrupt this clandestine romance between Correa and Chavez because it is not only costing Ecuadoreans their sovereignty (never much considered when profiteering or self enrichment is on the line) but because it is marrying Ecuadoreans to a vast money making scheme which Ecuadoreans now pay for- over and over. This is not an arranged marriage that benefits any but state kleptocrats and global criminals, who are profiteering from the Chavez and Correa criminal madness.

Rafael Correa, in his short tenancy, has openly pledged to merge Ecuador with Venezuela, remove functional democracy, has lied to international multilateral banks and investors as well as to the Congress of Ecuador about his own Annual Budget. He has filed a criminal law suit against Colombia in The Hague. He has no plans to provide Ecuadoreans with a solid future or job growth: indeed he has insured that there will be no jobs and no growth outside his Cuban style state enforced poverty of the serfs.

Correa has clandestinely signed numerous Agreements with Hugo Chavez that no one has seen. He has made agreements with Iran that none have seen. Correa has stripped police security for any he considers his "enemy" leaving them subjected to crude violence at the hands of his paid actors. In short, there is nothing to love about Correa and increasingly, his crimes against Ecuador are being known.

Misled or intentionally misinformed by personal choice as they are, the public in Ecuador now knows that U.S. Ambassador Jewell and U.S. Senator Reid and his colleagues are isolated in their previous wrong-headed rush to embrace the Correa plan for converting to the Chavez-Stalinist state. The U.S. Department of State, itself, still purging itself from its own apologists for Hugo Chavez, also called carry overs from the Clinton Era who actually abhor Plan Colombia and support the Soros paid anti-Plan Colombia activists- sometimes called NGOs- has just last week privately noted that Correa is "no friend" to the USA.

Indeed he is not a friend to the USA and his numerous schemes to defraud Occidental and other companies are well known. Correa is no friend to the USA and has no intention of restoring legal commerce with the USA, no matter what his paid mouth organs or recent lobbying adventures on behalf of Ecuador, such as Ecuadorean lobbyist Roger Noriega's well paid efforts to soothe and smooth what cannot be soothed, now known, are saying.

We have reviewed pieces in this site already that Correa's constitutional overhaul is a ploy to grab full powers at all costs and place his hands fully on all levers of government. The Congress of Ecuador, its lovers of free speech and free media, and its citizens, if they think about anything at all, must act swiftly to demand accountability and full disclosure from the Correa team. No further action to surrender adult leadership to this criminal empire under Correa's lead is acceptable.

The following article from the 2-8-07 Latin Business Chronicle, coupled with previous Financial Times pieces, states the nature of the crimes underway at the hand of Rafael Correa, legitimizing and reconfirming every post made in ECrisis. Globally, there is not one major media organization outside the self imposed brown out on information sharing by Ecuador's missing-in-action media that has not reported on the significant neo-communist and/or criminal enterprises underway in Ecuador at the hand of Rafael Correa who is determined to refashion Ecuador in to a pariah hedge-fund style opaque/ off the books/hidden state of duplicity, a narcoterror zone for criminal enterprises while jobs and education go begging. It seems that the global free media has teamed up with freedom lovers all over the world to state the case that Rafael Correa is criminally playing Ecuadoreans for fools

In lock step with Hugo Chavez, Rafael Correa is using the national patrimony of Ecuador to self enrich and play the numbers rackets with his new partners in crime. Ecuadoreans need to demand and insist on total disclosure of these facts. Ecuadoreans can no longer ignore the global realities: the world has denounced Rafael Correa as a criminal agent provocateur who has teamed up with the worst elements of Hugo Chavez's off the books global money makers.

Undeniably, the article reprinted below states, “Unfortunately, current events in Ecuador are highly choreographed and heavily manipulated." Further, "The aggressive statements issued by members of the Correa Administration are an overt attempt to push down Ecuadorian bond prices. At the same time, the close association between Ecuador and Venezuela, and the Chavez Administration’s growing propensity for market manipulation, suggests that the recent statements about the debt instruments were accompanied by surreptitious buyback operations. A game is, definitely, afoot in Ecuador. Government officials are playing a high stakes game of poker, and they are bluffing their way in order to bolster their bargaining positions. Nevertheless, the game is complex, and there are a lot of seasoned players on the table."

Understand this:  Rafael Correa is running Ecuador's economic positions as a dirty speculative game for fun and profit while promising his well paid foot soldiers, political golpistas, that they will soon have paradise- communist paradise- when he has had his way with Ecuador's finances. Rafael Correa's short term marriage of convenience to Hugo Chavez must be stopped for it is convenient only to criminals and fools. Instead of handing Correa all the power he demands, the Congress of Ecuador should be impeaching Rafael Correa for malfeasance, state kleptocracy, failure to be honest about one single thing, manipulation of state assets and budgets, failure to provide common security, failure to perform the obligations of his high office. In fact, he should be legally tried for state crimes underway.

Correa himself has noted that he must have total commitments to his power play by the end of March, 2007. He knows that he is racing against time to grab by any means possible full controls of Ecuador before the public wakes up to his schemes. In fact, that is only part of his demand to rush ahead. Correa knows well that as Chavez and Kirchner's new bag man of deadbeats, he is playing against time on his own speculative gambles with Ecuador's national economic structure. Literally, he has bet the bank- offshore- in a deadly game of arbitrage, against his own people.

To win his arbitrage, he must have his new constitution to aid and abet the cover up of his recent gambles and the wholesale elimination of Ecuador's oil profits and financial stability, now being drained. In four short weeks, over 25% of all bank holdings have fled or collapsed. No legitimate business will invest under Correa's dirty regime as the globe has denounced Correa's ridiculously dirty gambit. Outside Ecuador's mostly state-manipulated media, the only media still praising Rafael Correa is Castro's own Prensa Latina, itself a propaganda mouth organ.

All other international media has nothing good to say about Correa. Not one international bank will support Correa and Wall Street has stated repeatedly what the global media is finally noting: Correa's regime is dirty and is illegally driving Ecuador into bankruptcy and a failed state status. No legitimate investment group supports Correa. We are however aware that Quito's ANALYTICA, itself heavily involved with Ivonne Baki's Lebanese Muslim banking family, has previously supported PLO leaders such as Yassir Arafat in his radical prime, before the rise of the militant Hezbollah which today dominates the Muslim community in Lebanon by all accounts. We do not know what Ivonne's banker husband feels about his Muslim banking alliances in Lebanon nor do we know if he is still alive.

The article below states correctly, "...the events in Ecuador reflect the failure of the leadership class to move the region into a higher stage of development. The fact that Ecuador’s populist policies are being engineered to boost the political power of a handful of foreign-trained technocrats is a waste of the country’s human resources. President Correa’s socialist slogans sound appealing to the millions of Ecuadorians who are mired in poverty, but they will push the population deeper into misery. President Correa is killing off the chances of attracting foreign investment and boosting the country’s GDP growth rate by making it a pariah in the international capital markets. Instead of taking steps to attract the billions of dollars looking for new opportunities, President Correa is doing his best to ensure that it never crosses Ecuador’s borders. Unfortunately, the application of game theory, populist experiences and Marxist slogans to the goal of personal aggrandizement and wealth accumulation does nothing for the future of Latin America." In other words, Correa has hung up a sign across Ecuador that reads "Going Out of Business" - legitimate business that is in order to make money by selling out his country wholesale. This needs to be stopped this week.

As such, the facts are on the table. Ecuador's Correa and his team are making lots of dirty money off their own state. Correa is no friend to any but himself and his wallet....plus his Chavez-Castro political team of self enriching speculators who have bet the bank- their Central Banks- and have lost. But their crimes will go untended under the new dictatorial All Powers Acts granted by fake constitutions or as long as humans can stand to suffer.

The Editors, ECrisis

http://www.latinbusinesschronicle.com/app/article.aspx?id=826

Tuesday, February 06, 2007

Ecuador: Asymmetric Information

PARIAH PRESIDENT? President Correa is killing off the chances of attracting foreign investment and boosting the country’s GDP growth rate by making it a pariah in the international capital markets, argues Walter Molano.

The reckless abandon of the Ecuadorian and the Venezuelan governments reflect the lack of regional leadership in Latin America.

BY WALTER T. MOLANO

 The recent volatility in Ecuadorian bond prices piqued the curiosity of many investors. The plunge in bond prices, despite Ecuador’s ability to service its external obligations, followed by last week’s spike, after a wave of rumors that the government was wiring its next coupon payment to Euroclear, whipped up the speculative spirits of bond traders and fund managers. In the absence of market volatility, Ecuadorian bonds were the last remaining assets with life. Indeed, the emerging markets are a dull place. Bond spreads are plunging, the supply of sovereign bonds is dwindling and investors are not differentiating between the endless deluge of corporate credits bombarding the marketplace. Hence, it is no surprise to see the excitement caused by Ecuador. Indeed, the Andean country stirs a sense of nostalgia among bond traders who reminisce about the heady days of the late 1990s—when a ten point move represented a single standard deviation. However, one should be mindful about the current state of affairs in Ecuador. Macroeconomic forces drove the market volatility of the late 1990s. Unfortunately, current events in Ecuador are highly choreographed and heavily manipulated.

The aggressive statements issued by members of the Correa Administration are an overt attempt to push down Ecuadorian bond prices. At the same time, the close association between Ecuador and Venezuela, and the Chavez Administration’s growing propensity for market manipulation, suggests that the recent statements about the debt instruments were accompanied by surreptitious buyback operations. A game is, definitely, afoot in Ecuador. Government officials are playing a high stakes game of poker, and they are bluffing their way in order to bolster their bargaining positions. Nevertheless, the game is complex, and there are a lot of seasoned players on the table. Therefore, one should be careful. As the old adage goes, “If you can't spot the patsy at the poker table, then you are the patsy.”

The reckless abandon of the Ecuadorian and the Venezuelan governments reflect the lack of regional leadership in Latin America. Without a major power, or institution, to impose a sense of discipline, rouge elements are moving to the forefront. The U.S. government is too distracted by its Middle East adventures to devote any time or resources to policing the region. Mexico is too bogged down by its domestic problems to pay any attention to events on its southern flank. Besides a minor chastising to its developing country peers that they should stop whining, Brazil is not exercising the regional leadership role that was created by the absence of the U.S. hegemon—a role that it coveted since its independence.

Moreover, the events in Ecuador reflect the failure of the leadership class to move the region into a higher stage of development. The fact that Ecuador’s populist policies are being engineered to boost the political power of a handful of foreign-trained technocrats is a waste of the country’s human resources. President Correa’s socialist slogans sound appealing to the millions of Ecuadorians who are mired in poverty, but they will push the population deeper into misery. President Correa is killing off the chances of attracting foreign investment and boosting the country’s GDP growth rate by making it a pariah in the international capital markets. Instead of taking steps to attract the billions of dollars looking for new opportunities, President Correa is doing his best to ensure that it never crosses Ecuador’s borders. Unfortunately, the application of game theory, populist experiences and Marxist slogans to the goal of personal aggrandizement and wealth accumulation does nothing for the future of Latin America. The new administration in Ecuador is playing games. However, given the asymmetry of the information, the best strategy is to let them play alone.

Walter Molano is head of research at BCP Securities.