Latam Markets do not like the Venezuelan news…
Latam markets got hit today as news spread that Hugo Chavez, the President of Venezuela decided to nationalize major utilities as he expands what he calls a socialist revolution. This according to Reuters. The Bolivar officially pegged at 2150 per dollar was trading on the “Black Market” at 4100 per dollar. Stocks also fell 14.75%. Wow !
There was a major spillover effect into the rest of the region (much to my dismay). Stocks in Mexico are down 1.6%, Brazil 1.45% after being down much earlier in the day. Although I generally understand the reason for the sell off, I do believe it will be temporary (not Ven, but rather the other countries). Chavez has been a lose cannon for a while. The U.S. makes no bones about disliking him and wanting him out of power. The other countries in the region were approached by Chavez looking to form a Latin American Central Bank of sorts earlier last year. Lula, the President of Brazil, and a leftist also did not go along with the plan and even did his best to distance himself from Chavez. Please remember that I am “talking my book” but if this is the reason for the sell off then I am comfortable attempting to ride out the storm.
But why is the dollar so strong in the face of all that is going on. Sen. Ted Kennedy was just on TV telling the American people that the president will face resistance in his attempt to send more troops.
What I am missing? Please let me know.
FXTRADINGIDEAS@AOL.COM
There was a major spillover effect into the rest of the region (much to my dismay). Stocks in Mexico are down 1.6%, Brazil 1.45% after being down much earlier in the day. Although I generally understand the reason for the sell off, I do believe it will be temporary (not Ven, but rather the other countries). Chavez has been a lose cannon for a while. The U.S. makes no bones about disliking him and wanting him out of power. The other countries in the region were approached by Chavez looking to form a Latin American Central Bank of sorts earlier last year. Lula, the President of Brazil, and a leftist also did not go along with the plan and even did his best to distance himself from Chavez. Please remember that I am “talking my book” but if this is the reason for the sell off then I am comfortable attempting to ride out the storm.
But why is the dollar so strong in the face of all that is going on. Sen. Ted Kennedy was just on TV telling the American people that the president will face resistance in his attempt to send more troops.
What I am missing? Please let me know.
FXTRADINGIDEAS@AOL.COM
posted by Banker at
Tuesday, January 09, 2007
2 Comments:
flight to safety , from Latin Americans with money coming to US into dollars ... insane to have anything meaningful down there
So true ! Did you see who Chavez was with yesterday ? Leaders of Iran and Equador..enough said..
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