Archive for September, 2012

Exciting Rally With Capriles Closing His Campaign In Caracas

September 30, 2012

Even form afar, it is very exciting to watch today’s rally in which Capriles is closing his campaign in Caracas. Gigantic crowd! Capriles speaking well! Very emotional, very exciting! Wish I could be there! (I will be there to vote next Sunday!)
More here.

Chavista Electoral Dirty Trick #3,457

September 29, 2012

 

So, today, the Venezuelan Electoral Board announces that votes that go for the “Unidad Democratica” party, which as you can see in the “tarjetón electoral” above, has the picture of Henrique Capriles (red circle) will go to little known candidate Reina Sequera, the same one that is offering a cool US$ 1 million to each Venezuelan if she wins. You may think nobody will fall for this, but given that it has Capriles’ picture, that the opposition coalition is the “Mesa de Unidad Demócratica” and that Capriles is the candidate of the “Unidad”, the Electoral Board should have never allowed this change in the interests of fairness and democratic values. Except clearly, they are a bunch of hoodlum and have no scruples.

This is Chavista electoral dirty trick #3,457 and it simply shows these guys are worried…

Venezuelan Bond Soar On Higher Probability Of A Capriles Victory

September 27, 2012

For the last two months, Wall Street has been skeptical of a Capriles victory. In fact, at the beginning of the summer, it seemed as if the Wall Street bet, had more to do with a bet on Chavez’ demise than on Capriles pulling off a victory. As recent as two weeks ago, only one major Wall Street firm was suggesting that the probability of a Capriles victory was significant, with all ther saying that Chavez would win.

Thus, the “standard” view was that a Chavez victory would have a small impact on bond prices, because “nobody expects him to lose”, while a Capriles victory would yield huge gains.

I disagreed on all counts. First, I have believed that Capriles’ chances were larger than expected by Wall Street, while on the other hand I know that Venezuelans are so positive that if Chavez won they would sell all their bond holdings, pushing prices down.

But in investments all things are dynamic and this week, there seems to have been a change of heart and all of a sudden bond price shave started to soar. This is mostly due to the new polls and weaker conviction on the part of Datanalisis, a Wall street darling.

For example, below you can see the so called benchmark for Venezuelan bonds, the Global 2027, and how in the last few days it has gone up and up and now is pushing its recent high, after weak oil prices pushed prices lower from Sept. 14th to Sept. 20th. :

since then, all bond prices have risen and the Global 2027 went from 85.5% to 90% in barely five days which is a strong move, to say the least, historically.

What this says is that Wall Street is beginning to buy the probability of a Capriles victory, something that it was not even close to admitting a few weeks ago.

What this means is that foreign investors were somewhat underrepresented in this trade and now want to try to take advantage of what may be a very asymmetric gamble: If Chavez wins, bonds will drop a reasonably small amount, but if Capriles wins they may rise triple the same amount, if not more.

Of course, nothing is sure in this world. Th road to a Capriles victory may be easier than the road to a Capriles Presidency, if Chavismo decides to create trouble or simply to spend all of the reserves before Capriles takes over.

But for now, Wall Street and international investors are putting their money into Venezuela and PDVSA bonds, which is no guarantee of victory, but given that they do have something to lose, their money,  indicates a higher conviction and a much higher probability that Capriles may pull this off on October 7th.

First Poll That Says Capriles Ahead By More Than Margin Of Error

September 26, 2012
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OK boys and girls, here is the FIRST poll by a trusted pollster that says that Capriles is ahead by more than the margin of error of the poll. This is very positive, particularly coming from this source. Enjoy!

Venezuelan Central Bank Sells Gold In Secrecy

September 26, 2012

While I have no problem with a Central Bank selling gold from its reserves if it deems that this is the correct investment decision, the news that Venezuela had sold about 1% of its gold reserves is another example of how this Government does not have any accountability and how the move to bring the reserves to Venezuela was simply political grandstanding by Hugo Chavez.

First of all, we would have never found out about this, if the much hated International Monetary Fund had not published its annual financial statistics, showing that Venezuela sold about 3.6 Tons of gold. Since we don’t know when this happened, we don’t know how much money it was, but it is roughly US$ 180-190 million, pocket change for a Government that has thrown away billions in Chavez’ petty cash fund, called Fonden.

But the fact that the gold was sold after it was brought back to Venezuela purportedly to “protect” the gold reserves shows how cynical Merentes, Chávez and Giordani can be. Somehow, on the way back, or before the reserves came to Venezuela, they sold “only” 3.633 Tons of gold. Interesting that it was the old Venezuelan leaders that never sold gold and this Government that fills its mouth with words such as “sovereignty” and the “people’s gold” in defense of the gold reserves that went out and sold some for the first time in 30 or 40 years.

Gold reserves have saved the day for the Chávez administration. As gold prices went up, reserves dropped, but remained at a high level. Very recently, the Central Bank even changed how it accounted for the gold in order to make reserves look better. As I said, the whole show of moving the reserves was a signal that we should be worried, this is proof that I was right and it make get worse if Chavez wins on October 7th. As Chavez says, this was all for show, but not they have begun selling the family jewels in secrecy. The Faja, the mining projects, the concessions can all be reversed, but gold sold and money spent is simply no longer there (or here).

So much for caring about the people and sovereignty from a Government without scruples!

My First (Non) Prediction On The Venezuelan Presidential Election

September 24, 2012

I just spent a week in Caracas. I talked to anyone that claims to have a relevant number on the elections. Well, not everyone, I did not ask Jesse to meet with me, I am not sure he even goes out and runs polls. I heard all sorts of anecdotes, including one that went something like this: “In my maid’s family, all but the maid (Funny, how it is always that way!)  voted for Chavez in 2006, there are seven of them and four will vote for Capriles this time around, add my maid, that is five out of seven, Capriles will win.

I did see a few pollsters, not Consultores 21, they were in New York, giving their old numbers that say Capriles is ahead by 2%, but the margin of error is 2.3%. I heard part of a Datanalisis talk, but their numbers where superseded by new ones today. These say that Chavez has a ten point advantage over Capriles 47% to 37%, with 15.5% undecided.Funny how Chavez has not moved from 46-47% all summer.

However, I can’t quite comprehend these Datanalisis results when I see this private poll by the same pollster in Miranda State, in which Capriles wins by 16%. Given that Chavez won in 2006 versus Rosales by 13%, then this represents a shift of 29% in the electorate since 2006, in a state that is as heterogeneous as you can get (rural, urban, better off and poor, but in Class D, Capriles is ahead) and which represents 10% of the country’s population. Moreover, this State is contiguous with some of the most populous states that will be key to the election in October. It is difficult to envision that there has not been at least some shift in these states and that the 10% Datanalisis advantage to Chavez seems, at least to me, to be rather inconsistent.

It is also true that in the most rural states, which have smaller populations, Chavez won by as much as 40% in 2006, which implies that some of the differences can be compensated, but 10% still seems to large. To say nothing of the undecided in a country as polarized as Venezuela is today. The latter can be explained by the fact that Datanalisis asks a very open question, which includes, “Chavez”, “Capriles”,  “other”, “none” and even “don´t know” in the question. Or so I was told…

I also heard all sorts of anecdotes, such as “My neighbor, who works at the Ministry, says Capriles is ahead by 1%” or “My friend who is an expert on Chavismo, is leaving the country”. And so on…

But after this flooding of my mind with information, here is my conclusion, after processing my data with my slide rule, which you are likely to like as much as my friends who called me to tell me I was crazy to think that (They are my friends!):

The race, last week, based mostly on polls carried out before the infrastructure accidents in Cupira, Amuay and El Palito is too close to call based on the pollsters that I follow and numbers that I saw. Even in the best of cases, Capriles is ahead by a value which is within the margin of error.

There, get mad at me for not being more positive.

Are you over it? Then here is the caveats:

-Momentum is clearly in Capriles’ favor: His rallies have grown, people want to see him, touch him and he is now more accepted than he was two or three months ago. He creates “Fervor”

-Chavez’s campaign is fairly incoherent, he shows up every other day and his time campaigning is less and less every day.

-The opposition voter is much more motivated at this time. This has always been the case, but it may be magnified on October 7th. As a pro-Chavez analyst told me, “pro-Chavez voters may not vote for Capriles, but they are more than likely to stay home, rather than go and vote. Chavez campaign is very disorganized, which explains the failed rallies”

-Anti-fraud measures seem to be in place, with three opposition witnesses scheduled to be at almost all polling stations, the biggest obstacle being intimidation. (Witnesses have already been told in no uncertain terms not to show up again in some stations)

-Abstention is key. Most pollsters predict 26-27% abstention, less than that (25%), it favors Chavez, more than that (30%) Capriles wins.

But I am a numbers guy. From everything that I saw, heard and absorbed, this race is too close to call, it is 50/50, even, dead heat, too close to call. My heart wants to say 51%. I just can’t…yet.

Just don’t hate me, this is the way I see it and I would love to change my mind before the election.

Will certainly keep you posted, that’s what the Devil does, post, post, post.

Has Venezuela Deteriorated This Much?

September 23, 2012

The last few decades we have seen Venezuela deteriorate and values decay in many ways. From corruption to ethics, the news of one more “guiso” or scandal simply are assumed as an ordinary event. We seem to be by now immune to scandals and horrific news, from hellish jails to billion dollar losses, unacceptable events are barely given a glance and then people move on to the next item.

But I was completely shocked to read this item in the local press. In brief, two brothers, one of whom was a power line technician for Corpoelec, were murdered apparently because people were unhappy with the blackouts in the town of San Mateo, about an hour south of Caracas. According to the article, the technician was trying to fix a problem, when some neighbors approached him to complain about the delay in fixing the power problems and blaming him for the power failures. In the discussion, the neighbors pulled guns and shot the technician and his brother.

I don’t know if the story is true. I hope it is not. It shows a level of intolerance and impatience that is beyond belief and understanding. If I gasped when I heard that a rapist was killed by the neighbors a couple of years ago in Coche, western Caracas, this news item is simply horrific and again, if true, it represents a new hallmark in the deterioration of values in Venezuela. Life seems to have little value, for criminals or for ordinary citizens tired of bad electric service.

You would think this news would be prominent, politicians would condemn it, people discuss it. Instead it is an obscure news item in El Universal, unknown to most, ignored by many. Just another day in Venezuela…

Jimmy Carter: Get Lost, Stop Meddling In Venezuela!

September 21, 2012

I really take offense at Jimmy Carter coming out today, two weeks before the Venezuelan Presidential election and saying that “As a matter of fact, of the 92 elections that we’ve monitored, I would say the election process in Venezuela is the best in the world”

First of all, he is talking about a process that took place eight years ago, for which he gave his blessing when there multiple evidences of fraud and wrong doing and for which his foundation tried to railroad the accusations and technical proof of fraud by holding a sham seminar on them.

I mean this is the same Jimmy Carter that after praising Chavez, came out and said he was disappointed with him, but then proceeded to give a stupid version of the 2002 events.

And I have to question his timing, given that he and his foundation are not observing the upcoming election, have not seen the changes that have been made to the system used in 2004 and has not been in Venezuela since that time. Why now? What is his motive? What basis does he have to say what he is saying? What prompted him to make that silly and false statement?

After all, he said nothing about the fascist Tascon/Chavez list when it was used to discriminate against thousands of Venezuelans. He has said nothing abut the fact that the “best electoral system in the world” includes fingerprint machines which are only used to intimidate the population into believing that the Government may know how they voted.

Again, why now? Why try to give his blessing on the system two weeks before the election? What is his motive? Why give an opinion about something he is so out of touch with?

I suggest the former US President stop meddling with Venezuelan affairs and perhaps find sometime to read these papers or read this whole section of my blog, which shows that what he is saying is just a bunch of crap and that electoral process that he praises so much was tainted and he was partially responsible for the fact that the irregularities were not investigated right after the election, but were the effort of scientists and mathematician who did care about Venezuela and not just showing off.

Jimmy, please find something better to do and if you or any of your collaborators read this, please explain why you all of a sudden have to give an opinion without any recent contact with our electoral system. Once again, it makes you look dumb, tainted and I find it extremely fishy after your inconsistent previous record in Venezuela.

But should you want to reply, maybe you can clarify or try to clarify again if the Chavez Government ever gave the Carter foundation a donation. that was never answered properly (The denial went something like: “The Carter Center has never received a donation in connection with its role …”). But more importantly, please stop anyone from your foundation fromsaying things which are not true about Venezuela, you have played a very sad role in Venezuela, you should be ashamed.

Chavez Keeps Sending Wrong Signals To His Voters

September 18, 2012

While President Hugo Chavez has made a valiant effort to campaign or appear to be campaigning as much as opposition candidate Henrique Capriles, his efforts to appear more in public seem to be having the opposite effect. Every time Chavez appears in public, it seems to take a toll on him, forcing him to cancel rallies that had been announced previously.

Last week, President Chavez was not that visible until his Apure appearance, which in itself was a surprise as he should have no problem winning that state. In that appearance he left some doubts about both his health and his emotional state that left many questions lingering in the air.

The next day Chavez was supposed to appear in Los Teques to inaugurate four subway stations, but he failed to show up, sending his Vice-President instead in a city that is likely to go for Capriles.

Then yesterday, Chavez went to his traditional stronghold of Catia in Western Caracas in his Chavezmobile, but once he arrived at where he was supposed to give his speech, it was cancelled and the live transmission on the Government’s TV channel was suspended.  Some said that Chavez was mad at the low attendance, with former Mayor of the Libertador District Freddy Bernal justifying the low attendance by saying that the most important mobilization will be on October 7th. But a second version also said that Chavez showed his discomfort throughout the short 2 Km. ride. In any case, Chavez could surely not escape thinking that Capriles walked through Catia a month ago, with huge crowds following among a route which was larger than Chavez yesterday.

And then today Chavez suspended his visit to Portuguesa State, which will only send more wrong signals to the electorate. Portuguesa is a very pro-Chavez State, where not showing up may actually hurt the Venezuelan President after the visit was announced.

While I continue to be very cautious about the outcome of the Presidential election on October 7th. such signals, combined with the infrastructure accidents in August, which are not yet reflected in the polls and Chavez’ best “new” friend, Colombian President Juan Manuel Santos inviting Henrique Capriles to in Bogota, make me wonder if people know more than I know and I should be more positive at this time.

A Horrifying Video About Crime And Violence In Venezuela

September 16, 2012

A reader sends this link of a horrifying documentary (40 mins. ) about crime, jails and violence in Venezuela today. Worth Watching.

Note added: Apparently the video is blocked in Venezuela, please report below if you can watch it anywhere in Venezuela. To others, Daniel has a different version in two parts (From Youtube)

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