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Argentina Seeks China’s Help in Negotiations With the IMF; Talk of Joint Five-Year Infrastructure Plan

April 2 (EIRNS)–Argentine ambassador to China, Sabino Vaca Narvaja, has met with high level Chinese government officials in Beijing “to ask for that country’s support in the national government’s negotiations with the IMF, seeking an extension of payment terms and reduction in interest rates,” the daily Dangdai reported April 1, citing embassy sources.  Dangdai generally reports on Sino-Argentine relations, and touches on China’s relations with other Ibero-American countries to a lesser degree.

The Telam news agency reported that Vaca Narvaja met with the Foreign Ministry’s director of the Latin American and Caribbean Department, Cai Wei, with whom he discussed President Alberto Fernandez’s desire to refinance the $45 billion standby loan contracted by former President Mauricio Macri in 2018. Further citing embassy sources, Dangdai reported that Vaca Narvaja’s meeting included a discussion of the invitation to President Fernandez to make a state visit to China, now scheduled for early May, during which he is expected to sign a Memorandum of Understanding to join the Belt and Road Initiative. A review of the two nations’ bilateral agenda, Dangdai noted, focused on a series of infrastructure investment projects which both governments prioritize and which would be integrated into a joint Five Year Plan. Especially interesting was the discussion on the use of national currencies for trade and investment, including “an evaluation of productive and industrial projects that could be financed in renminbi, a currency which could be used subsequently to meet foreign payments to China.”

It should be noted that the IMF’s 2018 standby loan, which was originally for $57 billion, but whose last tranche Fernandez refused to accept after he became President, was granted by then IMF Managing Director Christine “Lady Gaga” Lagarde largely for political reasons to prop up the sagging Macri government and the brutal austerity program he was implementing in hopes he might be able to be reelected. Argentine authorities are in fact conducting a criminal investigation into the fraudulent way the loan was contracted and used–most of it ending up as capital flight and vastly expanding the amount of debt Argentina cannot pay. The loan violated Argentina’s constitutional norms as well as the IMF’s own internal regulations. Macri himself, his two former Central Bank presidents and two former finance ministers, are all under investigation.


Afghanistan: the Role of the Neighboring Countries in Development

Afghanistan: the Role of the Neighboring Countries in Development

Aug. 5, 2021 (EIRNS) – During a Schiller Institute conference July 31, Prof. Pino Arlacchi, the former head of the United Nations Office of Drug Control who negotiated near-elimination of Afghan opium production with the Taliban 20 years ago, noted that immediately neighboring countries should play a primary role in planning South Asian regional development to include Afghanistan, and in stopping drug traffic from that country. One country clearly taking the point for this kind of development is Uzbekistan, under President Shavkat Mirziyoyev.

A July 31 article in EastAsiaForum.org by Nasriddinov Salokhiddin, a researcher at the Institute for International Security of Tokyo International University, calls the February 2021 conference with Pakistan and Afghanistan organized by Mirziyoyev, “the event of the century for Central Asia”, because it will connect landlocked Central Asian countries to the Indian Ocean through Afghanistan and Pakistan. The conference attendees decided on a 600-kilometer Tashkent-Mazar e-Sharif-Kabul-Peshawar railroad and requested $4.8 billion in World Bank funding for it, Apparently the railroad corridor project was planned from the first to include new electricity transmission lines through it.

Noting the criticism that surmounting the Hindu Kush Mountains will make the project very expensive, Salokhiddin wrote: “Uzbekistan, Afghanistan and Pakistan filed an appeal for investment to international financial institutions, which [appeal] received support from the United States, China and Russia. Representatives of the World Bank, the European Bank for Reconstruction and Development, the Asian Development Bank and the Asian Infrastructure Investment Bank also expressed their willingness to assist the project through technical consulting and financing. Such wide support for the project means that the source of investment is no longer a concern.” He did not give dates or details regarding these other nations’ and international institutions’ support. He did add that the route transits Afghanistan through regions and cities which are under relatively secure government control now.

The author wrote that freight traffic in Afghanistan was about 4 million tons for 2020 and had risen by 25%. “Estimates suggest that if implemented, the trans-Afghan railroad will increase annual volume of rail freight by 20 million tons.” Some economists in Uzbekistan have advocated a railroad corridor to Chabahar in Iran instead, as allegedly more secure. But, “To achieve its economic objectives, access to the ports of Karachi and Gwadar is Uzbekistan’s highest priority.” Full article is here.


Fed Looks Like Losing Control of Interbank Lending, as in September 2019

Fed Looks Like Losing Control of Interbank Lending, as in September 2019

Aug. 5, 2021 (EIRNS) – A new Standing Repo Facility has been created by the Federal Reserve with an authorization of $500 billion subject to unlimited increase by Fed chair Jerome Powell. The Fed announced the facility July 28 and activated its operation July 29, indicating some urgency to cope with a liquidity problem in the interbank lending market, according to economists Pam and Russ Martens in their “Wall Street on Parade” column of July 28.

In September 2019 the Fed suddenly confronted a serious freeze-up in the interbank lending market and was forced to make emergency liquidity loans to the primary dealer banks which burgeoned up to hundreds of billions a day. There were many calls then for a standing repo facility, which was not created. Now it is set up, and will make repo loans not only to primary dealer banks, but to hedge funds, private equity funds, money-market mutual funds…. And, there is a second Standing Repo as well, for “foreign and international monetary institutions.”

So, the situation has clearly gotten much more unstable and contagious. The Federal Reserve has crammed the big banks with $4.5 trillion more in reserves just since the restart of QE in October 2019; those banks are crammed with trillions in new deposits while they have {withdrawn} loan and lease credit, net, from the economy, doubling their speculative {securities assets} the while.

Equally ominous, although the Martenses did not report it June 28: The Fed embarks on these new facilities to pump in liquidity, after about six weeks of reverse repo operations – where the Fed makes overnight loans of Treasuries in exchange for cash loans from banks; i.e., it {soaks up liquidity from the banking system} – which have run as high as $1 trillion/day! This indicates it is dealing with, or perhaps lurching around in, real volatility stemming from the very masses of deposits and stock-price gains it has caused to appear.

Worst of all, in the Martenses’ view, is that the Fed announced the Standing Repo Facility on the afternoon of the day it had been called for, in the morning, by the G30 Working Group on Financial Markets headed by the consummate bad actor in a financial crash, Tim Geithner. Geithner, as head of the New York Federal Reserve, “sluiced out $29 trillion to bail out the Wall Street banks” in 2008, as they wrote. 

The Standing Repo Facility will be operated by the New York Federal Reserve Bank.


WFP Beasley To Bezos: ‘The Sky Is No Longer the Limit’–Let’s End Hunger!

July 24 (EIRNS)–David Beasley, Executive Director of the World Food Program, tweeted on July 20, on the day billionaire Jeff Bezos took a ride into space and back:

“To @JeffBezos, @blueorigin, tremendous congratulations today! I can only imagine how incredible it was to see OUR planet from above. We’re all ONE human race. The sky is no longer the limit!! Now, let’s go end hunger together! Earth needs you!!
…you have proven over and over that anything is possible when you set your heart and mind to it. As you saw from space, Earth is a special place. 41 million people are on the brink of famine. I need your help. We need your help. Together, I know we can! #SpaceForBoth”


Railway Service in Europe Seriously Disrupted by Floods

July 22, 2021 (EIRNS)–The Trains.com website comments that portions of the rail network in Western Europe could be out of service for months or years in the wake of flooding that has left hundreds dead across a swath of western Germany and Belgium. Rail service has been suspended after the floods, which saw rivers running three yards higher than previous records in some cases and destroyed homes and businesses. See report here.

In Belgium, most rail lines south of Brussels saw disruption, with many in the hilly Ardennes region seriously damaged. The high-speed rail line connecting Brussels with Cologne in Germany was briefly closed, but as this goes through hills and over valleys, it was not seriously damaged. Services restarted over the weekend. The older rail lines that follow river valleys, often no more than a few yards above the river, fared much less well. Several routes are so badly damaged that reconstruction is expected to take until late August; less damaged routes reopened July 19.

In neighboring Germany, where the scale of destruction and loss of life has been greater, some rail lines, again built following river valleys, have been completely washed out. In total, German national railroad Deutsche Bahn has reported that 600 kilometers (more than 370 miles) of tracks and 80 stations are impassable.

The worst affected route along the valley of the Ahr River from Remagen to Ahrbrück has seen around 12.5 miles of its 18-mile length destroyed by flood water, with all seven bridges destroyed where the line crossed from one side of the river to the other.

In the Ruhr region, the main station in the city of Hagen was flooded and closed, along with rail lines through the city, as were those in the nearby city of Wuppertal. The flood waters knocked out power and telecom services in many areas. In the city of Bonn, the electronic signalling center controlling the main rail lines along the Rhine valley was unable to function, due to flood damage. Countries neighboring Germany have also seen flooding, with the south of the Netherlands hit with large-scale disruption to rail and road travel. As the weather system moved on, flood waters have affected Switzerland and by last weekend the rain had moved east to Bavaria in Germany and the neighboring Czech Republic, with the rail line between Dresden and Prague shut down July 18 as the Elbe River burst its banks. The Elbe alley was the scene of massive flooding in August 2002, which closed the rail line for three months.


Top Renewable Energy Co. Fails

Leading Renewable Energy Company Abengoa, Once the Cat’s Meow, Fails

March 5 (EIRNS)–A leading renewable energy firm, Abengoa SA, which has been the darling of the City of London and Wall Street financiers, and green Malthusians, filed for bankruptcy, on Feb. 23. The Spanish company has carried out projects in the United States, and in 2010, it received a large United States loan guarantee from the Barrack Obama-Joe Biden administration to build a solar energy plant in Arizona. This is the second largest bankruptcy in Spanish history, according to the El Pais newspaper, and has global implications. This represents a snap shot of the significant vulnerability of a planned $40 trillion green speculative bubble in “renewables,” even before it is built.

This will be the third failure of Abengoa; having cooked its books in 2015—it was later found out—in order to present a picture of functionality, it collapsed in 2016 (wiping out almost all the value of its stockholders). It restructured its debt in 2018, and was in the process of attempting to restructure its current 6 billion euro/US$7.3 billion debt load, when the Spanish regional government of Andalusia unravelled a larger bail-out package by withdrawing its part of the package: an offer of a 20 million euro loan to the failing Abengoa.

The July 5, 2010 GreenTechMedia reported that in 2008, Abengoa ‘negotiated with the Obama-Biden administration, along with Energy Secretary Steven Chu, that the U.S. government would extend to Abengoa a $1.4 billion U.S. federal loan guarantee—a very large sum at that time for renewables—to build a “250 megawatt “Solana solar concentrating power plant near Gila Bend, 70 miles southwest of Phoenix, Arizona. It would be a parabolic trough plant, that would supposedly be able to store some of the solar rays in the form of thermal energy. But the trick was that the plant would generate about 38% of its rated capacity, meaning that it would generate almost two-thirds below what its rated capacity said.

Abengoa also built in Hugoton, Kansas a hybrid biomass plant, which would convert 350,000 tons of biomass/year into 25 million gallons per year of liquid fuel. Abengoa opened this plant in October 2014; the plant shut down operations in December 2015. Abenoga sold the plant, which cost more than $110 billion to build, to another company for $43 billion.

It has not been made known what will happen to the $1.4 billion Obama-Biden loan guarantee that was made to Abengoa.

It should be noted that many solar and wind turbine companies survive only through U.S. government tax breaks and subsidies. According to the America’s Power organization, solar and wind have received $82.1 billion in tax subsidies just between 2010 and 2018.

The failure of Abengoa is a cautionary tale of what may unfold from a $40 trillion geen speculative bubble. That would take down the energy and electricity generating process, and slash agro-manufacturing processes, and human population. It would also, through its insanity, collapse financially.


Winners in New `Global Minimum Corporate Tax: Tech Giants, London `Offshore’

Winners in the New `Global Minimum Corporate Tax: Tech Giants, London `Offshore’

July 7 (EIRNS) – The Financial Times on July 3 reported that the City of London financial center had succeeded in winning an “exemption” for its banks and other financial firms – and those of Wall Street and Frankfurt – from the new “global minimum corporate tax” agreement ballyhooed by the U.S. Treasury at the time of the G7 finance ministers and heads-of-state meetings. The minimum tax scheme, considered a U.S. priority, is actually being negotiated and planned under OECD auspices.

A ZeroHedge column on July 1 had already noted that “while Washington likes to talk about the new framework as a foregone conclusion, there’s plenty of reason to doubt that it will ever be implemented. One reason is that countries like Ireland, Singapore, Indonesia and island tax havens like Bermuda all oppose the new scheme.” It could be expected that London would play this card.

In what was portrayed in financial media as hard bargaining between “the United States” on one side and “the UK and France” on the other, financial corporations got a “carve out” or safe haven from the minimum tax; and in exchange, the UK agreed to eliminate in stages its “digital services tax”, which has no American counterpart. France agreed to do this as well, on behalf of continental European countries’ tax authorities.

So while some nations may be hurt by the agreement – for example, Ireland and Russia, which currently have corporate tax rates below 15% — the Silicon Valley tech monopolists will come out just as sales tax-free worldwide, as they have always been in the United States; and the City and Wall Street banks will be subject to the 15% minimum corporate tax only in their home bases, and not in all the other places they operate in. That is to say that “London offshore” tax havens will still be tax havens.


Mexico Seeks Energy Security

Mexico Stands Firm: Texas Shows We Are Right To Put Energy Security Before Profit

March 3 (EIRNS)—In the middle of the Texas energy crisis, President Andrés Manuel López Obrador asked leaders of the Federal Electricity Commission (CFE) to brief the nation on how that crisis proves that his policy to restore national energy self-sufficiency and a  national electricity grid regulated by the government, fed by all energy sources, emphatically including fossil fuels, is urgent, and its opponents are dead wrong.

The climate mafia has launched war against AMLO’s “vision of energy sovereignty” and mandate for fossil fuels to be used before subsidized and unreliable wind and solar. “No other G20 country has such abnormal or retrograde energy policies as this government. It’s not going to advance us toward our climate goals,” one leading climate activist told the London Guardian in mid-February. International energy “investors” are preparing lawsuits against AMLO’s new Electricity Law to drive out the speculators, which was passed by the Chamber of Deputies last week and is expected to pass the Senate shortly. Rating agencies are preparing to lower Mexico’s credit rating, if it becomes law.

The CFE team, led by its chairman, Manuel Bartlett, who has been outspoken against the wind and solar energy frauds, detailed how the selling off of Mexico’s public sector electricity generation and distribution to a bunch of unregulated international speculators under the previous two administrations were the cause of the blackouts in Mexico when the cold wave hit, as happened in Texas. The officials pointed to the absurdity that Mexico, an oil producer with plenty of its own natural gas, now found itself with 64% of its national electricity powered by natural gas imported from Texas. Mexico was knocked out when the cold wave hit because the pipelines from Texas froze, and after that Texas stopped all export of natural gas because its wind and solar “renewables” failed, they
reported.

The CFE managed to cover 75% of the gap from the loss of natural gas imports by activating 11 hydroelectric plants, coal plants fed by mines which the López Obrador government had recently reopened, diesel supplied by the state oil company PEMEX at low prices, existing reserves of natural gas and purchase of some shiploads of the latter—at the wildly-high speculative prices on the international markets. Officials stressed that they could only do these things because under the energy sovereignty policy, thermoelectric plants which were under-utilized, nonetheless were maintained, against just such an emergency.

López Obrador then drew the lessons out: What just happened in Texas makes clear that it is not possible to give equal treatment to private foreign companies, he stated. The state needs to control the energy production and national electricity grid as an integrated whole. Under the previous governments, the energy sector was being taken apart, sold off in pieces, and looted. “It is important to recognize that these two public companies [Pemex and the CFE] do not have profit as their purpose, but to guarantee electricity service, and at fair prices, also, because we are going to continue fulfilling our commitment to not increase electricity prices, even with the speculation and increases in gas prices which are occurring in Texas and the United States.”


U.S.-China Diplomacy: Needs to Aim for Unity

China to Biden Team: It Is ‘Evil’ To Try and Prevent Any
People’s Right To Pursue a Better Life.

March 3 (EIRNS)—China’s Global Times responded strongly to a report issued March 1 by the Office of the U.S. Trade Representative, which accused China of undermining U.S. national interests through coercive and unfair trade practices and promised to use all available tools to pursue “strengthened enforcement” of China’s existing trade obligations. In other words, as the Global Times yesterday took due note, “the Biden administration has repeatedly said it is reviewing the previous administration’s China policy, but recent messages emanating from Washington suggest that the new administration is keeping the hardline stance against China. The Trump administration’s strategic goal of containing China will be inherited, and only the means of dealing with China may be adjusted.”

It is “understandable” and even “reasonable” that Washington would seek to maintain its leading position in technologies, and to protect its intellectual property rights, the editors of this official daily correctly assert. China does not protest U.S. policies towards China which aim at promoting U.S. development and increasing U.S. strength, but containment smacks of the “barbaric geopolitical games” of the 19th and early 20th century.

“We are in the 21st century…. Be they Americans, Chinese, Latin Americans or Africans, all people have the right to pursue a better life…. [P]olicies targeted at preventing China’s continuous development and even pushing China’s economy backward are evil. They pose a direct harm to the interests of the 1.4 billion Chinese people, depriving the natural right of the Chinese people to seek a better life….

“Restricting China from the perspective of intellectual property rights protection is different from jeopardizing China’s scientific and technological research and development capabilities. The former is part of the intellectual property rights protection regime, while the latter is an evil result of the geopolitical mentality.

“China has 1.4 billion people, more than the West combined, and much more than the population of the major Western countries combined. China’s development is the grandest project of the global human rights cause, and China’s development needs a relatively friendly international environment, including fair conditions for trade and technology exchanges…. It is malicious to take tough measures to suppress the ability of developing countries, and to tell large countries like China that ‘you deserve to be poor’….

“This kind of malicious policy cannot be followed up in a broad and lasting way in the 21st century. We hope the U.S. ruling team can see clearly the general trend, stop talking about human rights when it is trying to deprive the sacred rights of 1.4 billion Chinese people…. At last, we have to say that such evil is doomed to failure in the 21st century.”

{Source: “Policies Containing China’s Development Malicious: Global Times Editorial” https://www.globaltimes.cn/page/202103/1217096.shtml }


Yemen: Crime Against Humanity – Change It!

Yemen Donors Conference Raises Even Less Money for Yemen Humanitarian Relief than Was Provided Last Year

March 2, 2021 (EIRNS)—The UN donors conference which convened yesterday to raise funds for relief efforts in Yemen, cosponsored by Sweden and Switzerland, failed to raise even half of the $3.85 billion that UN Secretary General Antonio Guterres appealed for. Pledges amounted to a total of $1.7 billion, even less than the $1.9 billion that was donated in 2020. Guterres called for countries to “consider again what they can do to help stave off the worst famine the world has seen in decades.” Jan Egeland, secretary general of the Norwegian Refugee Council, who is on a week-long visit to Yemen, also called the outcome of the conference “disappointing,” warning that the lack of funding would cause huge cuts to Yemen aid. “The shortfall in humanitarian aid will be measured in lives lost,” he said.

The Saudis pledged $430 million; the U.S. promised $191 million, reportedly a decrease of $35 million from last year. The reduction in aid is attributed to the pandemic, corruption allegations, and concerns the aid might not be reaching its intended recipients in territories controlled by the rebels.

The Houthi leadership dismissed the conference, saying that such donor meetings only aid the aggressor countries and not the people of Yemen. “Conferences help aggressor states to identify themselves as obliging, not hostile or aggressor states which must end the siege and aggression,” said Houthi spokesman Mohammad Abdul-Salam, reported Iran’s Tasnim News Agency. He stressed in a twitter posting that stopping the aggression and lifting the blockade is the biggest help Yemen can ever receive. “The best services that the Saudi-led coalition provides to Yemen are nothing but daily airstrikes, brutal siege, the blockade of oil products and the closure of Sana’a International Airport, and the human consequences thereof.”


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