Category Archives: Finance

Banks sell the dollar to 12.79 pesos

The dollar sold free up to 12.79 dollars, two cents compared to last Thursday’s close, while the lowest price is the purchase of 12.25 pesos at the beginning of exchange operations in banks of the Mexican capital.

The euro reaches 16.91 dollars, its highest price on sale, 12 cents compared to the end of the session last Thursday’s exchange rate, while the yen is offered up to 0,155 pesos.

The Bank of Mexico (Banxico) fixed the exchange rate at 12.6591 pesos to settle liabilities denominated in foreign currency payable Mexico as establecipdo in the Official Journal of the Federation (DOF).

Interbank Interest Rate Balance (TIIE) at 28 days remains at 4.7650% and 0.0082 91 days advance percentage points compared with last Thursday to settle at 4.7900%.

Mining in Zacatecas Is Financially Productive

ZACATECAS – Given the high levels of metal prices, foreign mining in Zacatecas have found an ideal destination for investment in exploration and exploitation of deposits, said Miguel Alonso Reyes, governor of the state.

Among the companies that have reached the state are Oromex, First Majestic Silver Corp, Pan American Silver Corp., and even as Cymco Chinese firms, he said.

The president revealed that only in the work of holding companies will invest this year about 30 million dollars, not counting the resources disbursed Canada’s Goldcorp in the two new mines developed and Eve Red Road, and totaling approximately $200 million.

“Given the high level of metals prices, the state has received in recent years many companies,” he said.

Zacatecas is the largest producer of silver at the national level and about 23% of its gross domestic product (GDP) is linked to the mining industry. In addition, the entity is the second gold producer in the country after Sonora, and nationally, the state mining industry contributes 8% of Mexico’s GDP.

The attractiveness of the state mining has attracted interest from Chinese companies as Cymco, which assesses reserves of minerals like manganese to determine the investments made. “Zacatecas has abundant deposits of onyx, marble, cobalt, lithium and potassium as well,” said Eduardo Lopez meanwhile Muñoz, Secretary for Economic Development of the entity.

Potential

Only 30% of the territory of Zacatecas has been explored for mining projects, so their potential to develop this activity is still positive.

“We know that mining projects such as Goldcorp and other companies are 20 or 35 years, so it will continue exploration in various regions of the state,” said Miguel Alonso Reyes.

To date, around ten companies have operations in the state, and among them include Fresnillo, Grupo Mexico , Penoles and Goldcorp.

“In several municipalities of the state as Morelos, Peñasquito, Melchor Ocampo, the state capital, Cap and Veta Grande mining exploration continues,” the governor said.

According to the Mining Chamber of Mexico (Camimex), in 2012 investment in this industry exceeded the 3.500 million dollars and this year is expected to be at least maintained that level.


China Goes to a Slight Slowdown

BEIJING, China – China’s economy should exhibit a moderate landing this year, according to a known set of indicators on Friday, easing fears of investors to a sharp slowdown and reflecting the wide range that has Beijing to ease policy further and support growth.

Expectations that Beijing will respond to policy measures were strengthened with the first major series of hard economic data of the year, which showed a moderation in the pace of industrial production, inflation, fixed asset investment and retail sales.

A loan growth data cemented the view that monetary policy will relax even more, to support the demand for credit and ensure that the authorities will hope that the economy will slow enough to stop speculative investment, but create jobs to maintain social stability.

“We’ve had this history of soft landing for a while, this will not change,” said Huang Yiping, an economist at Barclays Capital in Hong Kong. “The easing of policy will continue for a while, but there is no urgent need to alleviate it aggressively,” he said.

China’s industrial production cooled more than expected in the first two months of 2012 to grow only 11.4% over the same period last year, due to lower domestic and external demand led to the production to its lowest level in more than two and a half.

This contributed to a slowdown in the consumer price inflation, which slowed to a minimum 20-month rate of 3.2% in February from a year ago, below forecasts of 3.4% but conveniently close to annual goal Beijing 4%.

Analysts said a combination of lower growth and inflation moderation should lead China to further reduce the level of cash commercial banks must keep as reserves.

Lowering the reserve requirement ratio (RRR)of banks, the Bank of China off from its aggressive monetary tightening last year, when it raised the RRR to a record high to curb inflation.

Money supply

The cash offer is a crucial lever of monetary policy in China, as Beijing is controlled directly by credit quotas to banks and adjustments to the RRR.

China suggests that their money supply to grow 14% this year to support economic growth of at least 7.5%.

“The new moderation in consumer price index gives more room to ease policy,” said Nie Wen, an analyst at Shanghai Hwabao Trust. “We expect the central bank to reduce the reserve ratio again in March,” he added.

According to a Reuters poll in December, economists had expected a decline of 200 points in the RRR in 2012. This ratio is at 20.5% after two cuts of 50 basis points in February and November.

In a sign of tight monetary conditions, the central bank reported that the M2 money supply grew 13% annual rate in February, slightly above the lowest in nearly 11 years in January.

Banks also borrowed less than expected by issuing 710.700 million yuan (112,500 million) in new loans in February, contrary expectations of 750,000 million yuan.

Available data on Friday showed strong distortions generated by the Lunar New Year holiday.

Retail sales disappointed with a growth of 14.7% in the period January-February, under the 17.5% target.

Investment in fixed assets, which represented about half of China’s economic growth in 2011, was a bit more than expected to grow 21.5% compared to 20 percent predicted, but remained at its weakest since December 2002.

 

 

Allen Stanford: Guilty of fraud

HOUSTON (Reuters) – Former financier Allen Stanford was found guilty Tuesday of conspiracy and fraud for leading a Ponzi scheme of 7 billion dollars that left dozens of victims in Latin America, which could make it happen almost 20 years behind bars.

The ruling was a victory for the U.S. government, which closed the Stanford financial empire in February 2009 but for years allowed the empire functioned in the air.

The Stanford is the biggest financial fraud from the incomparable Bernard Madoff fraud.

Stanford, 61, was convicted of 13 of 14 criminal charges, including fraud, conspiracy and obstruction of an investigation by the Securities and Exchange Commission.

However, the verdict could end up being just a moral victory for his victims, most of which has not recovered any of their money.

Stanford’s fortune was valued at some time in more than 2.000 million.

During the trial, which lasted six weeks, prosecutors repeatedly explained how Stanford had emptied his bank in Antigua, Stanford International Bank, using it as his “Personal ATM.”

The financier bought a house in Florida for one of his girlfriends. He had a yacht in the Caribbean and funded a prize of $20 million for an international cricket tournament.

The Government’s main witness, former Stanford adviser James Davis, and Stanford testified that he forged documents and invented financial reports to reassure investors and mislead regulators.

Channeled millions of dollars from Stanford International Bank to a secret account in a Swiss bank that Stanford went to personal use, according to the testimony of Davis.

Davis, 63, has pleaded guilty to three criminal charges.

Stanford’s lawyers presented his client as a visionary who was not involved in the daily activities of your company.

Davis blamed for all the fraud and said the Stanford business was viable until, in February 2009, the government closed down Stanford Financial Group in Houston.

Without money, Stanford was declared indigent by the court and his defense was paid for with public funds.

 

 

China Cuts Growth Forecast to 7.5%, Lowest Rate Since 2004

 

China has an economic growth target of 7.5% this year, down from 8% target for 2011, according to a government report that Prime Minister Wen Jiabao on Monday introduced to Parliament.

China often exceeds the annual growth target. Most economists expected the GDP to grow between 8 and 8.5% this year. In 2011, Chinese growth was 9.2%, although the pace slowed during the year from 9.7% in the first quarter to 9.5% in the second, 9.1% in the third and 8.9% in the fourth. In 2010, Chinese GDP grew at 10.4%. The reduction of the growth target this year compared to the previous expectation reflects the slowdown in the second world economy because of the debt crisis in the eurozone and the slow recovery of the U.S., which weighed on demand for Chinese products. The government also set its inflation target of 4% by 2012, as last year. In 2011, prices rose 5.4%. The chief minister also announced that foreign trade growth was set at 10%. In 2011, exports increased 20.3% and imports at 24.9%. Like in previous years, China’s yuan exchange rate remained stable”, the main trade partners of Beijing considered artificially devalued in order to promote exports. The government will nuanced saying “more flexible” exchange rate regime. The government also said it wants to “ensure that the real incomes of urban and rural residents as well as advancing economic growth. In that sense, the executive wants to spend more to improve the welfare of the population. China also wants to pursue industrial restructuring, “breaking monopolies” and “encourage private capital to enter the railroads, local governments, the finance, energy, telecommunications, education and medical care, according to the report of Wen Jiabao. These reforms appeared in a recent World Bank report by government advisers.

Governors of State Do Not Want Producers to Vote on Royalties

 

BRAZIL – Governors and representatives of more than 15 states began a movement to vote on the bill by collecting royalties from oil. This has been approved by the senate, which benefits the non-producing states. They also want to modify the calculation of the base salary of teachers and advocate renegotiation of the debts of the states with the Union.

The governors decided to make a movement of pressure and met with the presidents of the Chamber, Marco Maia (PT-SP), and the Senate, José Sarney (PMDB-AP). At the meeting, Marco Maia said that governors should mobilize their benches and a window can vote in the second half of March. But there are states such as Rio and Espirito Santo who refused to vote. The governors of these states were not present at the meeting.

The project is awaiting the assessment of members, authored by Senator Vital do Rego (PMDB-PB) and approved by the senate. This can cause loss of $48.8 billion by 2020 in Rio de Janeiro.

Earlier, the governors gathered at the house of the governor of Maranhão, Roseana Sarney (PMDB), and outlined a plan of action to press for a vote of royalties and other points. These were only attended by the governors interested in the royalty rate. In this first meeting, without the presence of Maia and Sarney, governors rose tone and charges made for greater involvement by the federal government.

Senator Marcelo Crivella (PRB-RJ) attended the meeting and heard in the senate to vote on the request of the royalties. “What Rio will lose is not true. They want the board to approve that excrescence”, Crivella said.. They had six priority issues: debt renegotiation, not voting the PEC 300, establishing a mandatory national floor for firefighters and police officers, approval of the project royalties, project commerce on the Internet, and change in the law and the Fund State Participation (FPE).

The governors advocate change in the calculation of the base salary of teachers. The Ministry of Education announced on Monday the new national floor of $1,451 for 40 hours, which means an adjustment of 22.22% compared to 2011. The value is retroactive to January 1.

Deficit Ended 2011 with Deviation of 2.5 Points on PSOE Forecast

 

All the government closed 2011 with a deficit of 91.344 million. The Minister of Finance and Public Administration,Cristobal Montoro, announced that the GDP is 8.51%, compared to the 6% forecast.

At a press conference, Montoro has reported that the deficit recorded last year for the state is 5.10% of GDP (against 4.8% expected), the regions, 2.94% (compared with 1, 3% predicted) and local authorities, the 0.38% (compared to 0.30% predicted). Meanwhile, Social Security ended the year with a deficit of 995 million euros, 0.09% of GDP, while the target predicted a surplus of 0.4% of GDP.

In his view, this diversion of Social Security is “disturbing” because it is speaking of “the public pension system” and emphasized that we have to clean it up more. Montoro has indicated that these data, confirm the imbalance of public accounts that has been 2.51 percentage points higher than the fiscal consolidation target of 6% last year, committed by the Spanish Government to the European Commission. Montoro has refused to blame the deficit diversion to the regions and said it has been a lack of central government “derogation” from the financing system. “We should not blame anyone.  We are all autonomous communities”, he stressed.

In this regard, Montoro reiterated that there is a need to devise a system, to see how public services are financed independently by the administration that manages them. Montoro also stressed the importance of budgetary stability law to control the institutions and avoid a deficit and breach of targets. 

 

European Stocks Hit by Postponed Agreement for Greece

European stocks opened down Thursday as investor confidence is affected by repeated postponements of the agreement to save Greece and the possibility of relegation credit ratings of several financial institutions in the Euro area by Moody’s, says Reuters.

FTSEurofirst 300 index of the most important European shares fell 0.9% in the early trading session, after reaching peak Wednesday last six months, a trend which has led some investors to sell to make profits increase 18% index recorded at the end of November.

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Fed’s New Mission Is to Devalue the Dollar by 33%

The Management Board of the U.S. central bank (Fed) has officially announced, after two days of debate, its new goal: to devalue the dollar by 33% over the next 20 years. The decline will be greater if the Fed’s own inflation target of 2% per year won’t be met, reports Business Insider.

A price increase of 2% a year won’t be felt in your pockets. Back in the day, during the gold standard (when the dollar was tied to the value of gold), such an increase was unusual. When the dollar was tied to gold, the years with modest inflation were followed by years of price declines. As a result, on along term, prices remained stable. And an American dollar was worth a dollar, 20 years later.

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Philippine Customs seizes P25M of smuggled vehicles

 

MANILA, Philippines – Some P25 million worth of smuggled items, including motorcycles and bicycle tires and parts, were seized by the Bureau of Customs (BOC) recently.

Ruffy Biazon, BOC Commissioner,  said importer Royal Halo Enterprises tried to pass its shipment of 36,000 bicycle tires and tire flaps from China. This has an estimated value of P22 million.

Another company, Cimberly Enterprises, brought into the country a completely knocked down Suzuki station wagon, three Honda motorcycles and a Yamaha scooter, which were declared as mini-tractors, grass cutters, motorbike parts, compressors, and gasoline engines.

Both of the shipments arrived in October last year and were discovered during scanning by officials of the BOC’s so-called X-Ray Project.

BOC X-Ray Project head Lourdes Mangaoang warned those trying to slip illegal goods into the country through misdeclaration. “Our scanners are three times more powerful than the ones being used in the United States.”

An order has been filed for appropriate charges against the people involved in the illegal importations.

 

 

P680 million budget for flood control campaigns

 

Manila, Philippines – President Benigno “Noynoy” Aquino budgets 680 million pesos for flood control campaigns and beautification of Metro Manila. The funds will be entrusted to the Metropolitan Manila Development Authority or MMDA. Besides the use of these funds for flood control campaigns, it will also be used for solid waste management and other urban renewal projects, according to Philippine Budget Secretary, Florencio Abad.

295.6 million pesos will be used for the construction of the pumping station at Salapan Creek in San Juan City, in order for floods to be prevented on the nearby areas. In Quezon City, the relocation of the informal settlers will be handled by the National Housing Authority and other local government units. Meanwhile, 154.4 million pesos will be used for the urban renewal, flood control, and traffic management projects in the entire Metro Manila.

The people are in good faith in trusting MMDA that they will use the funds for their cleaning projects—particularly in waterways and establish safe places for the residents in Metro Manila, especially during the rainy season.