The Ides of March is a good day to talk about catastrophes and
their
consequences. From times immemorial, ancient civilisations knew that they
had to appease whatever Gods they worshipped. They had them classified by
specialisation, until monotheist religions declared that a single being
could handle everything, making him busier than a Banco del Estado cashier
at 13.45 PM on a Friday. Pretty clever fellows, those ancients. The Roman
Neptune, alter ego of the Greek Poseidon, was both the God of Earthquakes
and of the Sea. The Aztecs had Tepeyollotl, just for quakes. Modern Man
thought he could do away with sacrifices such as throwing virgins into the
water (admittedly they would have a hard time finding enough virgins these
days), or opening hearts with obsidian knives at the top of a temple’s
stairs. They decided they had “dominated nature”.
It took just two minutes of the earth shaking, and a slightly longer rise
of the sea level, to do away with nearly 20 % of Chile’s GDP. Gone was in
that short time the legend, for it was a legend, of the modern, well
managed country, which had solved all its problems, tackled poverty,
eliminated shanty towns and provided a modern infrastructure. Gone was the
country which cheated its way into the OECD like an immature underage girl
putting on make-up to bypass security at a fashionable disco (I have never
been invited to the OECD, and I do not think it looks like a disco, but
you get the point). Gone was the regional leader pontificating and
lecturing to its neighbours and beyond. I feel sorry for the diplomats who
now have to explain to their chanceries why they recommended them to vote
for Chile’s admission to the OECD, or wrote all these glowing speeches for
their visiting VIPS whom they always kept well away from any dissenting
view. Sure, you cannot predict earthquakes, but if you know you live on a
fault line, you plan and act accordingly, and make sure those under your
jurisdiction also do so.
Interestingly or unavoidably, not a single reader, and certainly not those
same diplomats, analysts and journalists on my list who would always refer
to my warnings as “exaggerated” has had the courtesy to ring or write and
recognise my prescience. I know that many look upon these papers as
amusing entertainment to share with your spouse at home during the
week-end. Well I hope you enjoy running the vice-consulate in Ulan Bator.
I think in fact apologies would be more appropriate. I shall take this
situation into account in the future.
As for the new administration, if anyone is interested, there is not a
single member of it on my mailing list, so all this is between us.
THE QUAKE DAMAGE The figures estimating the cost of rebuilding and
repairing the destruction of the quake and tsunami, looked as if they came
out of a random number generator, with even simple logic thrown to the
dogs. Within a few days we heard that the damage to infrastructure was U$
1.2 bn, but that rebuilding or repairing hospitals alone would cost U$ 3.6
bn, and schools another U$ 1.6bn. Some time later, the total was put at a
more credible U$ 20 bn, and on assuming office, president Piñera mentioned
U$ 30bn. The truth is nobody knows, and it would be much better to name a
public-private commission to look at each sector and come up with serious
estimates.
Though copper mining seems to have come out of the event largely
unscathed, other crucial sectors have been hard hit. In some cases, they
may be back to normal within the year. In others, it may take double or
treble that. Among the casualties is the wine industry, already mentioned
in previous reports, the loss of 50 % of the country’s steel manufacturing
and beer brewing capacities, the closure of one of Chile’s two refineries,
extensive damage to the forestry and cellulose sectors, which will mean a
15 % drop in exports, varying damage to 300 irrigation installations (with
the related effect on agricultural production, from wheat to fresh
produce), as well as dairy farming, damage to the already moribund salmon
industry and the virtual disappearance of the infrastructure (boats,
jetties, processing facilities) for many coastal fishermen.
Understandably, hotel reservations for March were 50 %down, not made any
better by the cancellation of such diverse activities as the Congress of
Spanish Language Academies in Valparaiso (which appeared so badly
organised that it should have been named Spanish Language “and bad habits”
Congress- two working days before inauguration, there were still no
details of the programme), the curtailing of the Viña international song
festival and the scaled down version of FIDAE. Chile had been actively
marketing itself as a conference venue (quite a feat when there is not a
single purpose-built facility to host a large conference anywhere in the
country!), and it will take some time before people forget and accept to
attend the XXIst Congress of Lapsed Bangladeshi Jungian Psychiatrists in
Viña del Mar. The closure of the airport did not help the image either,
and its CEO saying that “it would cost too much” to have a quake-proof
terminal is hardly reassuring for passengers.
There was not much of architectural or historical value to see in
Santiago, but much of what there is in terms of historical public
buildings and churches has been damaged to varying degrees (including the
Moneda palace itself). Also a casualty has been the Colchagua valley,
where foreigners enjoyed the wine trail. Both the wineries themselves and
the traditional mansion houses of the proprietors have been affected.
International tourism is not the only casualty. Well apart from the
short-term reluctance of Chileans to go out with the risk of power or
water shortages finding them away from home, a whole area of low-cost
popular tourism consisting of down-market resorts for masochists who could
afford hotels, but think that a tent on a rainy dirty beach is cool, has
died as the small towns and fishing villages accommodating them have
literally disappeared from the map, like Atlantis.
SHORT TERM PROBLEMS The first and foremost challenge of the authorities
is to provide shelter and basic services to the between 1 and 2 million
people (probably the higher figure) who have been left totally or
partially homeless. Winter, which is both wet and cold in that part of
Chile most affected, is a few months away. Housing them is only part of
the problem. Their municipal buildings, schools and hospitals are often
unusable. Taking schools alone, 560,000 children have been left with their
schools in ruins (several universities have suffered too). No less than
4,000 hospital beds have been lost.
The amount of small businesses, beyond fishing, and including shops, small
workshops, staff attending tourists, etc. is huge, and many have dismissed
their staff, without a penny in indemnity. Basing themselves on
Pinochet-inherited labour legislation, which allows to fire employees with
no compensation within 6 days of a force majeure event, a huge number of
workers in what was already one of the poorest regions of Chile, has been
left destitute.
MEDIUM AND LONG TERM PROBLEMS The above situation gives rise to many
other question marks. Taking the most urgent first, one has to sympathise
with a couple of mayors from affected towns who rejected the putting up of
emergency wooden huts to replace destroyed houses. Called for some reasons
“media aguas”, though I think ”medio tonto” would describe them better,
these are the standard “solution” to emergencies in Chile and consist of
18m2 of wood panels and a roof, with no sanitary installations, insulation
or floor. The mayor’s reluctance is based on the fact that they tend to
become “permanent” (547 families from the earthquake in Tocopilla two
years ago have still to get proper housing, and this time we need half a
million!).
In a good average year, some 140 to 150 thousand dwellings are built in
Chile. How long would it take to replace four times as much, as additional
demand. Will there be enough materials, and at what price. Who will pay
for it? Worryingly, the neo-liberal Piñera ministers are talking of loans,
not grants, so in order to help the wretched, put them even more in debt.
Won’t the demand for scarce materials push prices up and thus inflation?
In Central Chile, people will be reluctant to buy high rise apartments, so
we would go back to low density housing and the price of land could go up
consequently. Will the “building boom” help unemployment? Only marginally,
because one thing is to clear the rubble which any able-bodied man can do,
but do you want an unemployed fisherman or mini-market cashier to rebuild
your damaged apartment block?
When it comes to public buildings, there is a bureaucracy that makes any
construction work very slow, in terms of administrative organisation, and
in normal years. Overwhelmed with necessities, unless the system’s inertia
is reformed, it could cause near-paralysis.
So if the unemployed cannot be fully absorbed by reconstruction, what will
they do? After losing patience, they might drift up to Santiago and create
a desperate miserable lumpen there, putting pressure on criminality and
social services alike.
What effect will all this have on growth? For 2010, it depends with what
speed the fundamental industries can build up to full capacity. The first
semester in particular could be bad, and I think it is foolish as yet to
start putting figures on expectations for the full year.
The drop in exports, notwithstanding better copper prices, and a rise in
imports needed to compensate the lack of enough national production, will
affect external accounts but it is not a matter that should cause worries.
External reserves ended at U$ 25 bn last February. Also deteriorating will
be fiscal accounts, which suffered in 2009 the dual impact of lower copper
revenue and pre-election largesse. Higher expenditure and lower tax
revenue will not improve matters this year. Once the extent of the damage
is clear and means of financing thought out, (from redirecting resources
of the normal budget to using part of the U$ 15 bn copper savings or going
out and borrowing abroad), the consequence can be better quantified.
The banking sector has yet to figure out the impact of the situation as
losses from bad debts may be compensated by new business related to
reconstruction and cash flow needs. The insurance sector, even taking
reinsurance into account, has obviously received a big blow. On the
peso/dollar exchange rate, exporters and expatriates should expect no
respite from the erratic and capricious management of the rate seen in the
past 20 years.
WILL ANYTHING CHANGE? We have seen that public services, even those
gloriously privatised under Friedmanite theories, did not live up to
expectations. Buildings supposedly quake-proof, collapsed in large cities,
water and electricity supplies are still a daily lottery even in Central
Chile, and to have a single road up and down the country is both
economically and strategically ridiculous. It is also unacceptable to
quote the above average intensity of the earthquake as an excuse or
explanation.
Quake proof means just that. Proofed against ANY quake known to man or
beast. I am less critical about the failure in telecommunications. We
never had our land lines interrupted for a minute, even when we were 85
hours without power, and the collapse of mobile phone systems is not due
to the quake but the stupidity of the natives, against which nobody has
yet invented a cure. Ringing all your friends and relatives after each
aftershock or cut in power or water, with the question “sentiste el
temblor?”, or “tienen luz?”, when just looking out of window would tell
you the whole town is dark, is a reflection of mental underdevelopment and
it would be meaningless to oblige mobile phone companies to invest in
capacity which allows 17 million idiots to use their mobiles
simultaneously and unnecessarily. As my late grandfather used to say :
“when God was handing out brains, why did you hide?”.
A lot has been said and written, and much more will, about remedial
measures for the future. Have no illusions. The national culture, both in
the private and public sectors, used to short-term returns, will not
accept to spend money or personnel resources on systems and equipment that
may be needed once every 20-25 years, or maybe never. They will consider
it as idle capital, and even the few who will be persuaded or forced to
act otherwise, will soon save on proper training and maintenance of said
equipment which when the time comes to use it will turn out to be out of
order. Greed is good, in Chile. There is one unchecked report that on
hearing the tsunami warning last Thursday, one Concon restaurant owner
shut its doors, with the customers inside, to ensure that they did not
escape without paying the bill. The legal and non-legal subterfuges
housing companies are using to get out of any responsibility for
jerry-building should give some thought to those who used to be so
admiring of corporate governance and the rule of law in the country.
2009 AT A GLANCE I was planning to write a full paper on the economic
results for 2009, because they would normally have provided the base for
the expected improvement in 2010. Now all bets are off, and I am just
giving out a few pointers on last year, even before the missing figures
are published next Thursday March 18.
Based on the IMACEC index, the Chilean economy shrank by 1.7 % last year.
Unemployment ended the year at 8.6 % (1.1 points higher than end-2008) and
the total number of employed shrank by 0.44 %. Inflation was a negative
1.4 %. Real wages increased by 6.4 % thanks to the negative inflation,
ending at a gross monthly average of U$ 760.
The trade surplus jumped by 51 % to u$ 13.31bn, with exports 20.2 % lower
at U$ 53.02 bn and imports 31.1 % down at U$ 39.7 bn. Copper accounted for
50.7 % of total exports and dropped a bit less than the average (- 18 %).
Wine exports rose 0.4 % in value but salmon sales declined by 17 %.
External debt ended 2009 at U$ 74.08 bn of which only U$ 14.47 bn owed by
the public sector. Balance of payment figures will be published on March
18.
On specific sectors, 133.526 dwellings were built (- 11.5 %) with a 14.5 %
drop in surface area. Adding other types of buildings, total surface built
was 18.2 % lower. Car sales dropped 28.3 % to 172,044 and truck sales 32.6
% lower at 8,152. motorbike sales were 30 % down. International air
passenger traffic was 5.8 % lower whereas domestic numbers rose by 6 %.
Fiscal revenue was 23.2 % down at U$ 36.05 bn whereas expenses rose by
17.8 % to U$ 44 bn. The resulting deficit of U$ 8 bn represented 4.5 % of
GDP vs. a 2008 surplus of 5.3 %.
Leading non-financial corporations’ earnings rose by 14 % to U$ 4.94 bn on
sales 13 % down at U$ 61.70 bn. 53 % of companies in the sample increased
earnings, 21 % reduced them and 25 % made a loss. Bank earnings declined
by 9.4 % to U$ 2.41 bn.
The Santiago stock market’s blue-chip IPSA index rose by 90.5 % measured
in U$, with a daily turnover averaging U$ 153 million. Its year-end market
value reached U$ 231 bn.
HUEVADA N°1 DE LA SEMANA
consequences. From times immemorial, ancient civilisations knew that they
had to appease whatever Gods they worshipped. They had them classified by
specialisation, until monotheist religions declared that a single being
could handle everything, making him busier than a Banco del Estado cashier
at 13.45 PM on a Friday. Pretty clever fellows, those ancients. The Roman
Neptune, alter ego of the Greek Poseidon, was both the God of Earthquakes
and of the Sea. The Aztecs had Tepeyollotl, just for quakes. Modern Man
thought he could do away with sacrifices such as throwing virgins into the
water (admittedly they would have a hard time finding enough virgins these
days), or opening hearts with obsidian knives at the top of a temple’s
stairs. They decided they had “dominated nature”.
It took just two minutes of the earth shaking, and a slightly longer rise
of the sea level, to do away with nearly 20 % of Chile’s GDP. Gone was in
that short time the legend, for it was a legend, of the modern, well
managed country, which had solved all its problems, tackled poverty,
eliminated shanty towns and provided a modern infrastructure. Gone was the
country which cheated its way into the OECD like an immature underage girl
putting on make-up to bypass security at a fashionable disco (I have never
been invited to the OECD, and I do not think it looks like a disco, but
you get the point). Gone was the regional leader pontificating and
lecturing to its neighbours and beyond. I feel sorry for the diplomats who
now have to explain to their chanceries why they recommended them to vote
for Chile’s admission to the OECD, or wrote all these glowing speeches for
their visiting VIPS whom they always kept well away from any dissenting
view. Sure, you cannot predict earthquakes, but if you know you live on a
fault line, you plan and act accordingly, and make sure those under your
jurisdiction also do so.
Interestingly or unavoidably, not a single reader, and certainly not those
same diplomats, analysts and journalists on my list who would always refer
to my warnings as “exaggerated” has had the courtesy to ring or write and
recognise my prescience. I know that many look upon these papers as
amusing entertainment to share with your spouse at home during the
week-end. Well I hope you enjoy running the vice-consulate in Ulan Bator.
I think in fact apologies would be more appropriate. I shall take this
situation into account in the future.
As for the new administration, if anyone is interested, there is not a
single member of it on my mailing list, so all this is between us.
THE QUAKE DAMAGE The figures estimating the cost of rebuilding and
repairing the destruction of the quake and tsunami, looked as if they came
out of a random number generator, with even simple logic thrown to the
dogs. Within a few days we heard that the damage to infrastructure was U$
1.2 bn, but that rebuilding or repairing hospitals alone would cost U$ 3.6
bn, and schools another U$ 1.6bn. Some time later, the total was put at a
more credible U$ 20 bn, and on assuming office, president Piñera mentioned
U$ 30bn. The truth is nobody knows, and it would be much better to name a
public-private commission to look at each sector and come up with serious
estimates.
Though copper mining seems to have come out of the event largely
unscathed, other crucial sectors have been hard hit. In some cases, they
may be back to normal within the year. In others, it may take double or
treble that. Among the casualties is the wine industry, already mentioned
in previous reports, the loss of 50 % of the country’s steel manufacturing
and beer brewing capacities, the closure of one of Chile’s two refineries,
extensive damage to the forestry and cellulose sectors, which will mean a
15 % drop in exports, varying damage to 300 irrigation installations (with
the related effect on agricultural production, from wheat to fresh
produce), as well as dairy farming, damage to the already moribund salmon
industry and the virtual disappearance of the infrastructure (boats,
jetties, processing facilities) for many coastal fishermen.
Understandably, hotel reservations for March were 50 %down, not made any
better by the cancellation of such diverse activities as the Congress of
Spanish Language Academies in Valparaiso (which appeared so badly
organised that it should have been named Spanish Language “and bad habits”
Congress- two working days before inauguration, there were still no
details of the programme), the curtailing of the Viña international song
festival and the scaled down version of FIDAE. Chile had been actively
marketing itself as a conference venue (quite a feat when there is not a
single purpose-built facility to host a large conference anywhere in the
country!), and it will take some time before people forget and accept to
attend the XXIst Congress of Lapsed Bangladeshi Jungian Psychiatrists in
Viña del Mar. The closure of the airport did not help the image either,
and its CEO saying that “it would cost too much” to have a quake-proof
terminal is hardly reassuring for passengers.
There was not much of architectural or historical value to see in
Santiago, but much of what there is in terms of historical public
buildings and churches has been damaged to varying degrees (including the
Moneda palace itself). Also a casualty has been the Colchagua valley,
where foreigners enjoyed the wine trail. Both the wineries themselves and
the traditional mansion houses of the proprietors have been affected.
International tourism is not the only casualty. Well apart from the
short-term reluctance of Chileans to go out with the risk of power or
water shortages finding them away from home, a whole area of low-cost
popular tourism consisting of down-market resorts for masochists who could
afford hotels, but think that a tent on a rainy dirty beach is cool, has
died as the small towns and fishing villages accommodating them have
literally disappeared from the map, like Atlantis.
SHORT TERM PROBLEMS The first and foremost challenge of the authorities
is to provide shelter and basic services to the between 1 and 2 million
people (probably the higher figure) who have been left totally or
partially homeless. Winter, which is both wet and cold in that part of
Chile most affected, is a few months away. Housing them is only part of
the problem. Their municipal buildings, schools and hospitals are often
unusable. Taking schools alone, 560,000 children have been left with their
schools in ruins (several universities have suffered too). No less than
4,000 hospital beds have been lost.
The amount of small businesses, beyond fishing, and including shops, small
workshops, staff attending tourists, etc. is huge, and many have dismissed
their staff, without a penny in indemnity. Basing themselves on
Pinochet-inherited labour legislation, which allows to fire employees with
no compensation within 6 days of a force majeure event, a huge number of
workers in what was already one of the poorest regions of Chile, has been
left destitute.
MEDIUM AND LONG TERM PROBLEMS The above situation gives rise to many
other question marks. Taking the most urgent first, one has to sympathise
with a couple of mayors from affected towns who rejected the putting up of
emergency wooden huts to replace destroyed houses. Called for some reasons
“media aguas”, though I think ”medio tonto” would describe them better,
these are the standard “solution” to emergencies in Chile and consist of
18m2 of wood panels and a roof, with no sanitary installations, insulation
or floor. The mayor’s reluctance is based on the fact that they tend to
become “permanent” (547 families from the earthquake in Tocopilla two
years ago have still to get proper housing, and this time we need half a
million!).
In a good average year, some 140 to 150 thousand dwellings are built in
Chile. How long would it take to replace four times as much, as additional
demand. Will there be enough materials, and at what price. Who will pay
for it? Worryingly, the neo-liberal Piñera ministers are talking of loans,
not grants, so in order to help the wretched, put them even more in debt.
Won’t the demand for scarce materials push prices up and thus inflation?
In Central Chile, people will be reluctant to buy high rise apartments, so
we would go back to low density housing and the price of land could go up
consequently. Will the “building boom” help unemployment? Only marginally,
because one thing is to clear the rubble which any able-bodied man can do,
but do you want an unemployed fisherman or mini-market cashier to rebuild
your damaged apartment block?
When it comes to public buildings, there is a bureaucracy that makes any
construction work very slow, in terms of administrative organisation, and
in normal years. Overwhelmed with necessities, unless the system’s inertia
is reformed, it could cause near-paralysis.
So if the unemployed cannot be fully absorbed by reconstruction, what will
they do? After losing patience, they might drift up to Santiago and create
a desperate miserable lumpen there, putting pressure on criminality and
social services alike.
What effect will all this have on growth? For 2010, it depends with what
speed the fundamental industries can build up to full capacity. The first
semester in particular could be bad, and I think it is foolish as yet to
start putting figures on expectations for the full year.
The drop in exports, notwithstanding better copper prices, and a rise in
imports needed to compensate the lack of enough national production, will
affect external accounts but it is not a matter that should cause worries.
External reserves ended at U$ 25 bn last February. Also deteriorating will
be fiscal accounts, which suffered in 2009 the dual impact of lower copper
revenue and pre-election largesse. Higher expenditure and lower tax
revenue will not improve matters this year. Once the extent of the damage
is clear and means of financing thought out, (from redirecting resources
of the normal budget to using part of the U$ 15 bn copper savings or going
out and borrowing abroad), the consequence can be better quantified.
The banking sector has yet to figure out the impact of the situation as
losses from bad debts may be compensated by new business related to
reconstruction and cash flow needs. The insurance sector, even taking
reinsurance into account, has obviously received a big blow. On the
peso/dollar exchange rate, exporters and expatriates should expect no
respite from the erratic and capricious management of the rate seen in the
past 20 years.
WILL ANYTHING CHANGE? We have seen that public services, even those
gloriously privatised under Friedmanite theories, did not live up to
expectations. Buildings supposedly quake-proof, collapsed in large cities,
water and electricity supplies are still a daily lottery even in Central
Chile, and to have a single road up and down the country is both
economically and strategically ridiculous. It is also unacceptable to
quote the above average intensity of the earthquake as an excuse or
explanation.
Quake proof means just that. Proofed against ANY quake known to man or
beast. I am less critical about the failure in telecommunications. We
never had our land lines interrupted for a minute, even when we were 85
hours without power, and the collapse of mobile phone systems is not due
to the quake but the stupidity of the natives, against which nobody has
yet invented a cure. Ringing all your friends and relatives after each
aftershock or cut in power or water, with the question “sentiste el
temblor?”, or “tienen luz?”, when just looking out of window would tell
you the whole town is dark, is a reflection of mental underdevelopment and
it would be meaningless to oblige mobile phone companies to invest in
capacity which allows 17 million idiots to use their mobiles
simultaneously and unnecessarily. As my late grandfather used to say :
“when God was handing out brains, why did you hide?”.
A lot has been said and written, and much more will, about remedial
measures for the future. Have no illusions. The national culture, both in
the private and public sectors, used to short-term returns, will not
accept to spend money or personnel resources on systems and equipment that
may be needed once every 20-25 years, or maybe never. They will consider
it as idle capital, and even the few who will be persuaded or forced to
act otherwise, will soon save on proper training and maintenance of said
equipment which when the time comes to use it will turn out to be out of
order. Greed is good, in Chile. There is one unchecked report that on
hearing the tsunami warning last Thursday, one Concon restaurant owner
shut its doors, with the customers inside, to ensure that they did not
escape without paying the bill. The legal and non-legal subterfuges
housing companies are using to get out of any responsibility for
jerry-building should give some thought to those who used to be so
admiring of corporate governance and the rule of law in the country.
2009 AT A GLANCE I was planning to write a full paper on the economic
results for 2009, because they would normally have provided the base for
the expected improvement in 2010. Now all bets are off, and I am just
giving out a few pointers on last year, even before the missing figures
are published next Thursday March 18.
Based on the IMACEC index, the Chilean economy shrank by 1.7 % last year.
Unemployment ended the year at 8.6 % (1.1 points higher than end-2008) and
the total number of employed shrank by 0.44 %. Inflation was a negative
1.4 %. Real wages increased by 6.4 % thanks to the negative inflation,
ending at a gross monthly average of U$ 760.
The trade surplus jumped by 51 % to u$ 13.31bn, with exports 20.2 % lower
at U$ 53.02 bn and imports 31.1 % down at U$ 39.7 bn. Copper accounted for
50.7 % of total exports and dropped a bit less than the average (- 18 %).
Wine exports rose 0.4 % in value but salmon sales declined by 17 %.
External debt ended 2009 at U$ 74.08 bn of which only U$ 14.47 bn owed by
the public sector. Balance of payment figures will be published on March
18.
On specific sectors, 133.526 dwellings were built (- 11.5 %) with a 14.5 %
drop in surface area. Adding other types of buildings, total surface built
was 18.2 % lower. Car sales dropped 28.3 % to 172,044 and truck sales 32.6
% lower at 8,152. motorbike sales were 30 % down. International air
passenger traffic was 5.8 % lower whereas domestic numbers rose by 6 %.
Fiscal revenue was 23.2 % down at U$ 36.05 bn whereas expenses rose by
17.8 % to U$ 44 bn. The resulting deficit of U$ 8 bn represented 4.5 % of
GDP vs. a 2008 surplus of 5.3 %.
Leading non-financial corporations’ earnings rose by 14 % to U$ 4.94 bn on
sales 13 % down at U$ 61.70 bn. 53 % of companies in the sample increased
earnings, 21 % reduced them and 25 % made a loss. Bank earnings declined
by 9.4 % to U$ 2.41 bn.
The Santiago stock market’s blue-chip IPSA index rose by 90.5 % measured
in U$, with a daily turnover averaging U$ 153 million. Its year-end market
value reached U$ 231 bn.
HUEVADA N°1 DE LA SEMANA
Sex and the
Chileans are not normal partners in a word association exercise, but the
previous government obviously got a good bargain by buying (probably from the
same agency), its infamous “All Ways Different” slogan. Currently in the
market is the domain www.sex.com, expected to reach U$ 1 million. What is
particular about this site? Its slogan:” All Ways in your Mind” has a
familiar air to it. What next? Promoting sex tourism in Chile to help in the
reconstruction effort?
HUEVADA N°2 DE LA SEMANA
HUEVADA N°2 DE LA SEMANA
The way people behave
under unexpected stress or crisis situation is an excellent indication of
their character. Thus the reaction of some of the foreign guests when a major
aftershock hit central Chile in the midst of the presidential handover
ceremony tells us a lot about them. We now know that Alvaro Uribe is a coward
who only feels safe under the skirts of the US military, that Cristina
Kirchner is somewhat hysterical, and that Evo Morales can keep the serenity
of native people who are closer to the Pachamama than modern man. Alan Garcia
is a clever opportunist who remained unperturbed and added later that it was
an honour to share the experience of Chileans in a quake. Let me add that
the representative of the Russian Federation did not loose his cool
either, but then, Hero of the Soviet Union, leading polar explorer and Duma
member Artur Chilingarov is an Armenian from St Petersburg, and we’ve seen
some more in our history! This was Chilingarov’s second trip to Chile in
recent years, and I am very sorry not to have been given the opportunity to
meet him on either.
