Thursday, April 17, 2014

Oppenheimer cautious about Latin America

(My new American Thinker post)

Latin America is a region of contrasts, as any tourist or frequent traveler will tell you.

The "Cuba-Venezuela" group is a mess.  The economies are not growing and a disregard for "the rule of law" discourages investment.

The Chile-Mexico-Colombia group is doing a lot better, in large part because of their political stability and attractive treatment of investors.  For example, Mexico just passed energy reforms and Chile continues to be the envy of the region. 

Colombia and the US are trading more than ever, in large part because of the free trade agreement.

Overall, I agree with Andres Oppenheimer that "caution" may be in order:
"According to the IMF's semi-annual report released at its spring meeting in Washington on April 8, Latin America's economy will grow by 2.5 percent this year, and by 3 percent next year.
That's lower than the region's growth rates in the past decade, but suggests that its economies may soon begin to rebound. 
The World Bank, in its “consensus forecast” based on nearly three dozen projections by mostly private sector banks, said that Latin America's economy will grow by 2.3 percent this year, and by 3 percent in 2015.
In January, the World Bank had forecast an “upbeat” future for the region, forecasting a 3.7 percent growth rate in 2016.  
Among the region's largest economies, the best-performing one will be Mexico, which is scheduled to grow by 3 percent this year, and by 3.5 percent next year, the IMF said.
“Mexico’s ongoing economic reforms, especially in the energy and telecommunications sectors, herald higher potential growth for the medium term,” the IMF said in its report. 
Other countries that will show healthy growth rates will be Peru, (projected to grow by 5.5 percent this year and 5.8 percent next year,) Bolivia (5.1 percent this year and 5 percent next year,) Paraguay (4.8 percent this year and 4.5 percent next year), Colombia (4.5 percent both years) and Chile (3.6 percent this year and 4.1 percent next year,) the IMF said. 
Among the countries that will show meager growth are Brazil, the region's largest country, which is projected to grow by 1.8 percent this year and 2.7 percent next year, according to the IMF.
Brazil's economy will continue to suffer from a “loss of competitiveness and low business confidence,” the IMF said. 
Finally, Latin America's worst performing economies will be Venezuela and Argentina, the IMF says.
Venezuela's economy will shrink by 0.5 percent this year, and will drop by another 1 percent next year.  
In an interview, IMF Western Hemisphere director Alejandro Werner told me that he projects Venezuela's inflation rate, which reached a world record of 56 percent last year, to rise to 75 percent in 2014.
Werner said that unless Venezuela adopts an economic adjustment program, inflation may turn into hyper-inflation in coming years.
“Typically, when countries reach inflation rates of 50 or 55 percent, they either adopt adjustment programs to put a break on it, or inflation keeps growing progressively,” he said. 
Argentina's economy is projected to remain virtually flat, with a 0.5 percent growth this year, and will probably grow by 1 percent next year."
Again, Latin America is showing the world that "free markets and the rule of law" works.  

At the same time, the economies that lack freedom (like Cuba or Venezuela) or have a huge tax burden or big government (like Brazil) do not grow.

P. S. You can hear our US-Latin America show of the week with Fausta Wertz and Cecilia Torres here & follow me on Twitter @ scantojr.


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Happy #50 to the Ford Mustang


We celebrate another 50th anniversary this year:

"The Ford Mustang, a two-seat, mid-engine sports car, is officially unveiled by Henry Ford II at the World’s Fair in Flushing Meadows, New York, on April 17, 1964. 

That same day, the new car also debuted in Ford showrooms across America and almost 22,000 Mustangs were immediately snapped up by buyers. 

Named for a World War II fighter plane, the Mustang was the first of a type of vehicle that came to be known as a “pony car.” Ford sold more than 400,000 Mustangs within its first year of production, far exceeding sales expectations."

I never owned a Mustang but maybe I should go out and buy one!

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Wednesday, April 16, 2014

Cubans remember something else that happened on April 15th

(My new American Thinker post)

Like you, April 15th is "IRS day" or the day that you rush to the post office to get that tax return in the mail.  More recently, it's the day that we file online.  Or, maybe the day that we renew our call for a "flat tax".

In baseball terms, April 15th is the day that Jackie Robinson broke what they used to call "the color line" in the major leagues.  He opened the game at first base and made history.  

For Cubans, and especially those of my parents' generation, April 15th is the day that Fidel Castro visited the US in 1959, a few months after taking power.

Castro's visit was rather controversial because he faced skepticism from many in the US.  He was asked about the promised elections that were delayed and delayed.  He also heard over and over about communists in the background:
"The trip got off to an inauspicious start when it became clear that President Dwight D. Eisenhower had no intention of meeting with Castro. Instead, Eisenhower went to the golf course to avoid any chance meeting with Castro.
Castro gave a talk to the Council on Foreign Affairs, a New York-based group of private citizens and former government officials interested in U.S. international relations.
Castro was confrontational during the session, indicating that Cuba would not beg the United States for economic assistance.
Angered by some of the questions from the audience, Castro abruptly left the meeting.
Finally, before departing for Cuba, Castro met with Vice President Richard Nixon.
Privately, Nixon hoped that his talk would push Castro "in the right direction," and away from any radical policies, but he came away from his discussion full of doubt about the possibility of reorienting Castro's thinking.
Nixon concluded that Castro was "either incredibly naive about communism or under communist discipline-my guess is the former.""
Castro also appeared on Meet the Press and denied that he was a communist.  He even joked about it saying that some people think that Adam & Eve were communists. 

The video is classic:



Castro denied that he was a communist and put people in jail for accusing him of that.  In December 1961, he declared his allegiance to Marxism-Leninism!    None of the people jailed for suggesting communism were released when Castro confirmed that he was a communist.

I think about my parents, my dad's cousin held as a political prisoner and other things about Cuba that happened that April 15th!

P. S. You can hear CANTO TALK here & follow me on Twitter @ scantojr.


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Brazil on the eve of The World Cup 2014


We spoke about the situation in Brazil with Monica Showalter of IBD plus Michael Prada.  

The World Cup has forced Brazil to look at corruption, infrastructure problems and the protests.


Tags: Brazil  To share or post to your site, click on "Post Link". Please mention / link to the My View by Silvio Canto, Jr. Thanks!

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