Low oil prices, OPEC cuts and Rafael Correa's energy policy are causing havoc in the Ecuadorian economy

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

Unfortunately things have changed for the oil-producing countries, given that the price of a barrel of oil has lost more than one hundred U.S. dollars in less than a year. This has drastically reduced the income of oil producers and is particularly affecting countries with the weakest economies.

However, things are worse for the oil-rich countries that are OPEC members, as they face not only lower oil prices, but also production cuts ordered by the organization to defend prices.

Although OPEC cuts may eventually impact the market favorably, their effects are not immediate. So this waiting period can cause serious damage to member countries that have problems with their finances.

This can be seen especially in a country like Ecuador, which is struggling to pay its foreign debt due to the weakness of their public finances. But now, if OPEC wants a cut of 40.000 barrels a day from the Ecuador's production -this country currently produce 500.000 barrels a day- this will cause a daily loss of $1.600.000, or $48.000.000 per month, to the Ecuadorian finances.

Perhaps this does not seem very big, but we must take into account that Ecuador is a small economy, whose GDP barely exceeds 50 billion dollars and that depends on 60% of oil exports. Consequently, if OPEC cuts leave a country like Ecuador with a yearly loss of 576 million dollars, they represent a major problem.

Paradoxically, it was Rafael Correa who reintegrated Ecuador into the OPEC last year, so he cannot blame previous governments for these commitments.

Until now, the Correa government has invented to fulfill its OPEC quota by imposing the cuts to private oil companies operating in Ecuador. However, this measure does not improve the government's fiscal balances and has the potential to scare off investments of foreign oil companies interested in Ecuadorian energy projects, which necessarily will require private capital to be completed. Especially if we consider that Correa's political godfather, Hugo Chavez, is also running out of money.

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A Marxist theology. First criticism of Liberation Theology

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

The Liberation Theology is a political theory born in Latin America, linked to part of the Catholic and evangelical hierarchy that seek to address poverty mixing Christian and Socialists concepts.

For the theologians of liberation, capitalism is a "social sin" guilty for the poverty that afflicts the world. For them, this economic system is the cornerstone of poverty, so we can't solve inequality until we replace capitalism.

In the Liberation Theology, capitalism's classes -bourgeois and proletarian- prevent the realization of a world of equals. Furthermore, "imperialism" of the developed world on the developing world destroy any chance of escaping poverty in the exploited regions.

For that reason, according to the Liberation Theologians, Christians must take the "class struggle" and fight on the side of the oppressed to dismantle capitalism -even using violence if necessary- However, this message is closer to Marx than to Christ, because Jesus never spoke of "capitalism", "class struggle"or "imperialism", and much less to carry out violent revolutions, as Marx did.

We can highlight in the Liberation Theology its concern about poverty and its desire for a more equal world, but this can also be recognized in Marxism -theoretically- The problem is that both ideologies fail in the proposed solutions. For example, fomenting the class struggle is as sponsoring racism, because these ideas have incited hate and violence in the societies where they have been promoted.

Another problem with the theology of liberation is that, in practice, it has encouraged the active participation of Catholic priests and evangelical pastors in anti-democratic governments. Such was the case during the communist regime in Nicaragua -Sandinism- and the current Venezuelan government.

Under the socialist administration of Sandinista National Liberation Front in Nicaragua, several pastors and priests, followers of this theology, manipulated dozens of religious communities making them believe that the Jesus' teachings can be achieved in Marxist revolutions. Thus were born groups such as "Christians for the Revolution," "The People's Church" and "Revolutionary Parishes”. Movements that for one side spoke of Christ and the poor, but that on the other justified the establishment of a Communist dictatorship that violates human rights.

With regard to Venezuela, we have the issue of the Reformist Catholic Church, a Venezuelan religious sect born under the auspices of the Hugo Chavez's government and linked to the liberation theology movement. This congregation professes socialism, chavism and Christianity as complementary concepts.

For these reasons we argue that the theology of liberation is a Marxist theology, inconvenient to the true Church, because in theory and in practice its slogan of "opting for the poor" really means "choosing the radical left".

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Alfredo Keller's survey on Chavez's proposal for indefinite re-election. Venezuela, December 2008

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

The following is an excerpt from the latest Alfredo Keller's survey, where this organization measured the popularity of President Chavez and compared it with the popular support of the indefinite re-election proposal in Venezuela.

According to the results of this study, Keller estimates the popularity of President Chavez at 52%, however, their measurements indicate that only 26% of the electorate agrees with the establishment of president's indefinite re-election in the Venezuelan Constitution.

This implies that chavism is very divided and that the sympathy of the Venezuelans for democracy is stronger than his affinity for President Chavez. That is, chavists and opponents make up a majority who understands that, in democracy, a person cannot remain indefinitely in the Presidency because of the risk that its mandate can become a dictatorship.

However, it should be noted that Chavez is not a man who accepts no for an answer. Attempting to counteract the unpopularity of his proposal, he will try to impose through fear, the purchase of consciences and the mobilization of their political machinery.

Click on the image to enlarge it

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Proposed constitutional amendment for indefinite re-election in Venezuela

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

Click here to download the full text –in Spanish- of the draft constitutional amendment amending Article 230. Hugo Chavez is proposing this change to be reelected indefinitely as President of the Republic of Venezuela.

The current Venezuelan Constitution states:

"Article 230: The presidential term is six years. The President of the Republic may be re-elected, immediately and one-time, for a further term."

But with the amendment it would assert:

"Article 230: The presidential term is six years. The President of the Republic may be re-elected."

The National Assembly will begin to discuss this amendment on December 18, 2008, where Chavism plans to approve it as soon as possible. In theory the project should be approved in two discussions and sent to the CNE. Then, the National Electoral Council set a deadline for a referendum.

This project violates the democratic principle of alternation in power and seek to privatize the Presidency of the Republic in the hands of Hugo Chávez.

If this amendment to the Venezuelan Constitution is approved, we will be going the way of Cuba and North Korea, where dictators come to power, remain there for decades, and abandon it only when they are so old that they can no longer oppress others.

We must remember what Simón Bolívar warned in 1819, at the Congress of Angostura:

“The continuation of authority in the same person has frequently proved the undoing of democratic governments. Repeated elections are essential to the system of popular government, because there is nothing so dangerous as to suffer Power to be vested for a long time in one citizen. The people become accustomed to obeying him, and he becomes accustomed to commanding, hence the origin of usurpation and tyranny. A proper zeal is the guarantee of republican liberty, and our citizens must very justly fear that the same Magistrate who has governed them for a long time, may continue to rule them forever.”

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Is indefinite reelection the best option to solve Venezuela’s problems?

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

Due to the bad governments of the past, and the disastrous administration that Chavez has been running for ten years, Venezuela has become plagued by serious problems, including hyperinflation and exponential crime rates.

In our country most people are poor and face multiple forms of deprivation and social exclusion.

However, the bizarre of this is the solution proposed by the current government. President Hugo Chavez is convinced that the best way to solve the problems of Venezuela, and Latin America, is to establish a presidency that has the potential to continue indefinitely, conducted under the totalitarian tenets of socialism.

This idea of life presidency is generally proposed in third world countries where institutions are weak. The indefinite reelection has been tried before in Latin America and has always had sad ends. Fidel Castro, Fujimori, Noriega and Pinochet were in their time defenders of this outlandish proposal to justify their tyrannical claims, and there we have the consequences.

Venezuela does not need presidents for life, and even less if the proponent is a degenerated and inefficient government.

Life presidency will not end poverty, or reduce inflation or avoid capital flight, nor improve the country’s health. The only purpose of indefinite reelection is to incubate autocracies eager to oppress the people.

Hugo Chavez has concentrated in his hands most of the power in Venezuela, from weapons to laws, but he is incapable of using it to benefit the needy.

Only a selfish and indolent leader will seek indefinite reelection as president, regardless of the real needs of the population.

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Why Barack Obama nominated Hillary Clinton as his Secretary of State? Is he preparing a hard-line diplomacy?

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

Barack Obama came to the presidency as a critic of the current U.S. administration external operations, particularly the war in Iraq and the excessive military spending.

This has raised many expectations around the world because people assumed that the present American hard-line, represented by George W. Bush, is going to be discarded by the Obama government. In an administration that will use dialogue and non-intervention abroad.

But the Hillary Clinton nomination as Obama’s Secretary of State means that: 1. She will advise the new President on foreign policy, and 2. She will lead the U.S. international affairs after Obama.

Mrs Clinton is highly qualified for the position, however, in many ways she fits very well into the hard line of the U.S. foreign policy. We must remember that Clinton voted in 2002, from the Senate, in favor of giving President Bush the authority to intervene militarily in Iraq. At the same time she supports the maintenance of the embargo on Cuba, the war against terrorism and the U.S. humanitarian intervention anywhere in the world. In addition, Clinton supports the use of diplomatic, economic, intelligence, and military instruments to enforce U.S. policy against Iran.

Moreover, Hillary Clinton refused to sign the "American Freedom Agenda" to stop the torture of war prisoners and telephone espionage. Without forgetting, that she was in favor of interventions in Haiti, Bosnia and Kosovo.

Therefore, Barack Obama’s appointment of Hillary Clinton as Secretary of State is an indication of a hard-line foreign policy. A position that contradicts the "change" and "no war" promises that the newly elected U.S. President made during his campaign.

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Santiago del Estero 2008: Kirchnerists again?

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

Coming November 30, 2008, the inhabitants of the province of Santiago del Estero, in Argentina, will elect regional authorities. In this dispute, the Governor’s seat is the most important. The aspirants in this contest are:

Gerardo Zamora (Kirchnerist, seeking reelection)

Antonio Calabrese (Coalicion Civica)

Rosendo Allub

Marcelo Lugones

Francisco Cavallotti

Andrea Ruiz

Vicente Lo Bruno

Aldo Bravo

Francisco Vargas

Rosendo Salto

Gerardo Zamora and Antonio Calabrese are the more likely to be elected. The problem with Zamora is his alliance with Kirchner and his radical leftist ideology based on Peronism.

According to some Argentine pollsters, the current Governor Gerardo Zamora has the advantage in this race. However, since last month we have noticed that Antonio Calabrese is gaining momentum.

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Analysis of the results of the Venezuela 2008 regional elections: Chavism won in quantity but Chavez’s opponents achieved the strategic victory

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

If we see the results of the November 23 Venezuelan elections in a general way, all indications are that Chavism demonstrated superiority over their opponents, as it took the majority of mayors and governors of the Venezuelan territory. So that we can say that, in quantity, Chavez was the winner.

But if we consider only the victories of chavists and opponents in areas of great importance, those who stand out because of population density, political influence and economic/cultural development, we could assert that the opposition was the winner of the strategic places.

We say this because the major population centers in Venezuela, as well as the capitals of national economic and political power, are in the territories: Capital District, Miranda State, Zulia State, Carabobo State, Vargas State, Bolivar State, Anzoategui State, Lara State, Tachira State, Aragua State, Chacao Municipality of Miranda State, Baruta Municipality of Miranda State, Sucre Municipality of Miranda State, Libertador Municipality of Capital District and Maracaibo Municipality of Zulia State. In these regions, the opposition won most of the seats.

Can you figure out an emerging political party in USA winning elections in California, Texas, New York, Florida, Illinois and Pennsylvania? This was what Chavez’s opponents did in Venezuela.

However, we must mention that the opposition didn’t take control of other key regions due to its inability to achieve unity, where the cases of Bolivar State and Anzoategui State highlight. With these States, the “strategic” victory over Chavism would have been greater.

On the other hand, it is remarkable for the opposition the Carlos Ocariz’s victory in the Sucre municipality of Miranda State, a region where Petare and many of the poorest areas of Venezuela are located. So this victory contradicts the assertion that dispossessed are with Chavez.

After the last elections, we must recognize that today Chavez’s opponents have gained power, becoming stronger than before. In the 2004 elections for the regional seats, the opposition had only won two governorships, now it has triumphed in six.

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A New Constitution for Bolivia in 2009 would put conditions on private property and would protect Coca

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

Here you can download the contents of the Constitution draft approved by the Constituent Assembly of Bolivia on Sunday, December 9, 2007. This proposed Constitution will be submitted to a popular referendum on next January 25, 2009.

Click here to download the full text –in Spanish- of the draft Constitution that Evo Morales and his supporters want for Bolivia.

We read the whole project and we think it is very inclined to Statism. Besides its content has a Marxists aspect, especially with regard to private property and its social function.

In general we recommend paying attention to Article 56, which stipulates that the right to private property is guaranteed only if it satisfies a social function. And to Article 57, which contains the government’s constitutional right to expropriate any property that does not fulfill a social function.

That means virtually the abolition of private property, because possessions are permitted only if they meet collective interests or social objectives. Karl Marx couldn’t have written it better.

But there are more, because article 172, paragraph 27, establish the President as the highest authority of the Bolivian Service of Agrarian Reform, which gives the President special powers for the distribution and redistribution of land.

Then call attention to the articles 393 and 397, which again decreed that the State recognizes the ownership of land, if and only if, it has a social function or a social economic function. It is further indicated that work is the fundamental source for the acquisition and preservation of agricultural property –another Marxist idea- and that if the properties do not meet their social function, or social economic function, do not safeguard their rights.

In sum, we can say that this draft Constitution subordinates private property’s rights to the socialist ideology, which is a violation of basic human rights agreed in the United Nations.

Finally, we drew attention to the shelter that this draft constitution grants to coca, considering it original and ancestral -Article 348 – But If the constituents want to justify the planting of coca with the argument that it is part of the Bolivian tradition and culture, they should think more carefully. What they propose is like justifying sexism, arguing that it is part of the tradition and culture of some country.

Our wish is that Afghanistan and Colombia do not copy this botanic proposal, and come in to protect opium and poppy in their Constitutions, because we would have a flood of narcotics worldwide.

Therefore, we have no doubt that if the Bolivians decide to approve this defective Constitution draft, it will be require a constitutional amendment within a few years.

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Russia’s invasion of Georgia showed the leftists' double standards

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

When the government of George W. Bush waged war in Iraq and Afghanistan, the international Left went into hysteria, outraged by what they said was a violation of the self-determination right and an abuse of power by the Yankees.

But when the Russian government decided to illegally invade the defenseless nation of Georgia, bringing in its wake a wave of killings and human rights violations, the international Left looked elsewhere and said nothing.

Rather, their radical representatives, those like Hugo Chavez who dream of the return of the tyrannical Soviet Union, were devoted to insulting the Georgian people, prompting the Russians to use their military power to conquer Georgia and all the former soviet republics.

This exposes the double standards with which the leftists deceive their followers. What the Socialists criticize is worse when they have the power.

Russia has left Georgia, due to protests raised by the civilized world, but we wonder when will the double standards disappear from the leftism?

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Barack Obama’s economic background is his Achilles' Heel

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

Yesterday, November 4, 2008, Barack Obama was elected president of the United States, which means that from next year, he will lead the nation toward solving their main problems.

One of his first tasks will involve addressing the United States financial crisis, where recession, problems with mortgages, high inflation, fiscal and trade deficit, highlight.

However, we have reasons to believe that Obama may lack the capacity to deal with these economic problems. We should consider that at this stage and although the economic issue was key in the final part of the presidential race, Obama has not provided a specific strategy to address the shortcomings of the current economy.

So far, Obama has talked about the financial debacle in general terms, proposing to modify the Bush bailout plan with ideas such as limiting pay for executives of businesses that are bailed out and making sure the effort includes a specific plan for the money to be repaid.

Obama has made a prevention project to avoid future financial trouble, but his country not only requires a prevention plan for the future, it also demands a good proposal to solve the present crisis.

In addition, we have to remember that during his time as a candidate, Obama never showed a brilliant speech on economic issues -as we have been explaining this is not his strong suit- His more attractive proposals were those related to social security, education, health, foreign policy and social inclusion.

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Punishment vote and anti-Bush sentiment in favor of Obama

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

Everything indicates that Barack Obama will run away with the United States 2008 presidential elections, but we must recognize that not all the votes that Obama will get will come from his leadership or his proposals.

The rise of Barack Obama is also a direct consequence of the two issues that have hammered George W. Bush and the Republican Party: the war in Iraq and the economy.

That's why the Democrats based part of their election campaign on criticism of the George W. Bush administration, accusing it of taking decisions which led to the current financial crisis and the failure in Iraq.

In fact, Obama and his supporters want to withdraw U.S. troops from Iraq as soon as possible and put an end to the Bush policy of “tax cuts for the rich”. Two proposals pleasant to the anti-Bush sentiment and to those who use the vote as a punishing instrument -punishment vote-

Therefore, while it’s true that Obama has the potential to succeed primarily with his ideas, it’s also true that he has benefited greatly from their discredited opponents.

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On Barack Obama’s comments about the redistribution of wealth: is he a Marxist?

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

Seven years ago Obama expressed his dissatisfaction against the United States Supreme Court, considering that this institution has not ever been involved in the redistribution of wealth. And recently, Obama said that if elected president he would redistribute wealth.

These statements are now used by John McCain and his supporters to point out that Barack Obama is a Marxist. However, we have to say that these McCain’s attacks on Obama are not well founded.

The concept of "Redistribution of Wealth" or "Redistribution of Income" is not a socialist idea. It’s true that in theory the communists aspire to a more equal society, but that does not mean that socialism is the only ideology that includes the phrase "Distribution of Wealth" in its proposals.

The ideal of sharing the wealth is found in many political theories. It’s even implicit in ancient texts. The difference lies in how the redistribution is proposed. For example, there are those like us who think that taxes, education programs, opportunities for upward social mobility, charitable works and some state institutions can be used to reduce inequality. But there are also the socialists, who think that abolishing private property is the only way to redistribute wealth.

Therefore, Barack Obama´s remarks on redistribution of wealth are not sufficient to consider him a socialist. To do so it would be required that he affirm, or practice, ideas such as abolishing private property, dictatorship and centralization of power, support for communist guerrillas, attacks on Christianity, one-party system and elimination of individual freedoms.

So, it is wrong to assert that Barack Obama is a communist by believing in the Redistribution of Wealth. Rather, McCain made a big mistake accusing Obama of Marxist by expressing this idea. It could be misunderstood by the public as if the Republican candidate does not share the ideal of redistributing income.

Ironically, McCain also has a plan in his government’s program to combat inequality, but obviously he doesn’t know that such policies are based on the Redistribution of Wealth concept.

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Barack Obama's victory in 2008 would give a moral blow to the Latin American radical leftism

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

Some people are worried because they believe that if Barack Obama wins the presidency of the United States, will not be as critical as McCain against the abuses of the Latin American radical leftism.

But if we see it from a different point of view, perhaps Barack Obama also represents advantages for those who are opposed to the communist project that Hugo Chavez and his imitators want for Latin America.

We believe this because Barack Hussein Obama II is not a neoconservative. By contrast, Obama is a critic of the hard-line Republican, so it cannot be accused of defending the oil companies, or be a spokesman of the United States major corporations.

In addition, Barack Obama has an Arab name and is African-American -his father was Kenyan- something that will prevent him from being linked to the Anglo-American elite.

And finally, Barack Obama has always been a critic of the George Bush style of government. Especially the lack of diplomatic achievements and the way Bush conducted the war in Iraq.

Characteristics that make Obama, a man who represents everything opposite of what the Latin American left say about the United States.

As a result, if Barack Obama becomes the next U.S. president, the leftist Latinos will receive a great surprise in finding that, although Obama is not a neoconservative, he will oppose, in a different way, to the authoritarian governments and to the antidemocratic proposal of the Latin American radical left.

An opposition that will be very detrimental to Hugo Chavez and his imitators, since it would mean for the Socialists being criticized by someone, that in spite of racism and not being the flagship of the United States dominant groups, knew how to succeed with intelligence and democratic ideas.

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The 2008 United States financial crisis: Origin, government action and ideological implications

Authors:
Luis Alberto López Rafaschieri and José Alberto López Rafaschieri
www.morochos.net

Due to the bankruptcy of four banks in the United States, the international radical left, and some people who don't know what they are talking about, say free market doesn't work and democracy should be replaced by socialism.

Over there we have seen people like Teodoro Petkoff in Venezuela, stating that "Milton Friedman must be rolling in his grave, because the State had to lend the market a hand." As if the free market theories suggest the government extinction.
After, we listened to Cristina Kirchner asserting "the financial crisis in United States shows that the Washington Consensus failed." As if the radical left ideas have had better results than the political models based on freedom.
And then we saw Hugo Chavez saying that "capitalism is the responsible for the United States financial crisis" and "the next U.S. president will receive a sinking ship." What shall we say then about socialism's achievements? the worst political model that humanity has known in the past one hundred years!
But we will go beyond words, look briefly what happened and realize the reality.

Origin of the crisis
During the years 2001 and 2002, the United States was on the brink of deflation. This forced the Federal Reserve's decision to put interest rates at 1%, trying to stimulate the economy.
At that time, financial institutions in the United States borrowed billions of dollars from the Federal Reserve, taking advantage of the low interest rate, and spread the funds in the American credit system, primarily in the mortgage markets.
Everything was going perfectly and banks made easy money, because the business was simple: borrow at 1% and lend at 5%.

But not only banks tried to take advantage of low interest rates. Like financial institutions, many middle-class buyers sought for loans to buy houses and enjoy cheap money.
Unfortunately, the happiness did not last long. Then came the years of great economic prosperity, from 2003 to 2006, and the Federal Reserve normalized its interest rate, placing it above 5%.
This meant that those who were over-indebted, now had to pay 400% more interest than before. As a result, many debtors could not pay their credits, delinquencies rose to historic levels, hundreds of people lost their properties, banks no longer had any way to get cheap money from the FED and losses reached the financial institutions.

A bearish market makes things worse
Complicating the matters, the U.S. housing market was full of foreclosed properties, which were being liquidated below their natural price.
This means that those who sell receive less money than they paid for. Furthermore, it takes a long time to close deals, due to the amount of offers generated by a lot of people with the same problem.
And as the number of debtors and banks affected is so great, the problem became a crisis.

The government intervenes because democracy is not anarchy

Faced with this situation the government intervenes, because it is the responsible of ensuring economic stability in a democratic nation like the United States. However, those who have a misconception about the free market theories -like Teodoro Petkoff- think that the "invisible hand" of Adam Smith seeks a country where actors perform without regulations.
But simply observing democratic societies where free market has flourished, we can realize that these are the world’s countries with more regulations on the private sector. Clarifying that in democracy, these regulations maintain the private sector linked to the legal system. Quite the opposite of what happens in socialist nations, where governmental action seek to exterminate the private sphere.
It was in democracy and in the countries with free market, where the Rule of Law born and the legal theories reached their maximum progress.
Those who believe that liberalism is proposing a free society without law and government are wrong. That would not be liberalism but anarchism.
Free market cannot exist without the government's supervision. Therefore, the intervention of the U.S. authorities to assist borrowers and banks in trouble is a measure that fits perfectly within the free market paradigms, because democracy implies the existence of a sovereign government, pledged to make everything necessary to help their citizens.

Democratic transparency
Indeed, during this crisis we have seen one of the biggest differences between democracy and dictatorial models.
We see the problem recognition by the U.S. government and the freedom with which the media disseminates news, including criticisms that inform the public.
On the other hand, if this crisis occurred in countries such as Cuba or Venezuela, the government would deny the existence of a financial problem. The journalists with unofficial information would be jailed and the independent media would be accused of conspiracy.
Furthermore, no government official in Cuba or Venezuela would try to resolve anything, because no one could pretend to solve what for them does not exist. This would make things worse, as always happens in dictatorial regimes, enemies of transparency.

Nothing new in this crisis
But back to the United States, the current financial crisis doesn’t represent anything new to democratic societies. As an example remember the risk of deflation in the United States during the years 2001 and 2002. A similar crisis that caused huge losses in the stock market and annihilated giant companies like Enron and Adelphia.
At that time, the enemies of freedom said the same arguments they use now: Free market collapsed and democracy should be replaced by socialism.
Then 2003 came in, economies recovered and democracy once again showed better results than the leftist thought.

Is this the end of the U.S.?
So far, there has been no human power capable of challenging the time. Therefore, we must assume that the United States reign will someday be surpassed. But unfortunately for those who expect the Yankees’ collapse, for now we have to recognize that the United States remains the world's leading power, with no opponent close enough.
Economically, we must consider that 70% of the world's savings are denominated in U.S. dollars, with the American founding fathers images on them. Furthermore, to have an idea of its magnitude, the U.S. economy is equivalent to that of the entire European Union. And it’s the world’s most competitive and innovative economy.
However, for those who still believe that the U.S. economy went bankrupt, or that democracy has come to an end, we present a quite eloquent chart.
Here are the historical records of the Dow Jones industrial index from 1900 to the present. Look at the fall today, it's just a scratch in the meteoric rise that the U.S. economy has experienced over the past hundred years.
Forget leftist fantasies! Democracy and free market continue irrefutably being superior to socialism and leftist ideas.

Click on the image to enlarge it

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Analysis of the OPEC meeting scheduled for Oct. 24, 2008

Authors:
José Alberto López Rafaschieri and Luis Alberto López Rafaschieri
www.morochos.net

Due to the big fall that have taken crude prices in recent months, the Organization of Petroleum Exporting Countries, which controls about 40% of the world's crude production, decided last Monday to call an emergency meeting for the coming Oct. 24.

At this summit, the cartel will analyze the current situation in the oil market, where crude oil, after marking nearly $150 per barrel last July, has been losing about 50% of its value, even falling below $75. It will discuss also the projections for oil demand this year and next, whereas today's OPEC lowered expectations for consumption at 550,000 barrels of crude a day.

In this context, it is expected that OPEC decided to encourage its members to cut one million barrels a day to its production, with the intention of lifting the international oil prices.

We believe that the cut is necessary, because the producers were pressured to produce at maximum capacity during the first half of the year, trying to cope with the uncontrolled escalation in crude prices. It is therefore logical that in this new scenario of low prices, the oil producing countries seek the market rebalance. The difference is that this time they will attempt to contain the fall in prices.

Unfortunately for oil exporters, the world economy is experiencing a crisis that affects with forcefulness the energy consumption, so we do not believe that this OPEC measure will have the enough effect to return the oil to record levels in the coming months. However, a shortage of supply itself may help oil prices fall with less intensity.