Media and LatAm Navel Gaze: June 12, 2017
Lordy! That may have summed up spectators’ conclusion (and certainly James Comey’s) on both sides of the aisle last week for the over hyped, covered and analyzed yet much-anticipated testimony of former the FBI Director. Not a whole lot new there, but a few bits on leaking by Comey himself, accusations, debates on the word “hope” and some serious headlines (a full five columns in the NYT, the first in a while) and editorial cartoons. Now we’re looking for tapes and awaiting or the next rounds of testimony. Tickets go on sale soon, perhaps.
- Upset in the UK with snap election causing PM May to lose control, making murky Brexit talks;
- A National Security Agency contractor named – wait for it – Reality Winner – leaked classified docs to The Intercept on Russia landing her on the front pages most places and in jail;
- The Nordstrom fam wants to take the store private;
- Yahoo!/AOL is cutting 2,100 jobs as a result of Verizon deal (can they hear them now?)
- A slightly volatile session in stocks Friday saw the Dow close at a record higher at 21,271 while tech stocks tumbled in what has been called a “rethink” or “repositioning” in broader positions to send the Nasdaq with the big tech names in the S&P 500 losing 2.7 percent on Friday;
- Taylor Swift returns to Spotify in surprising front-page splendor; and
- Nadal made tennis history as the only to win 10 titles – in this case the French Open -- in the Open era while 20-year Jelena Ostapanka took the women’s prize.
- What is happening in Brazil?
This past week Brazil’s superior electoral court (TSE) voted on whether to impeach President Michel Temer for illegally funding his party’s 2014 presidential via donations from international conglomerate Odebrecht. What seemed like a sure impeachment reversed course when the court barred the use of testimony from Odebrecht’s plea bargain, which would have clearly outlined this crime and almost certainly led to an impeachment.
Without that evidence, the TSE acquitted Temer by a vote of 4 to 3. Gilmar Mendes, head of TSE who cast the deciding vote to acquit Temer (and who has a long-standing relationship with Temer), justified his swing-vote by referencing, among other things, Brazil’s long history of political instability (only 5 presidents have completed their terms since the country became a democracy in the 1980s) and how Brazil, who last year impeached ex-president Dilma Rousseff, could ill-afford to lose another president in such a short time span. The other 3 judges who voted for an acquittal based their decision on a similar series of technicalities.
But Temer is not out of the woods yet. General Prosecutor Rodrigo Janot is expected to file a separate case into an alleged bribery cover-up involving Temer and the former heads of meat-producer JBS (the Batista Brothers), where Temer is caught on tape endorsing a bribery scheme, a tape that was submitted as part of a plea-bargain from the Batista brothers.
Should that investigation garner the necessary momentum, the motion for Temer’s impeachment can be brought to the Supreme Court. The problem? Having this case reach the Supreme Court requires approval from two thirds of Brazil’s Lower Congress, which is controlled by Temer’s party.
Expect a bumpy ride over the next few months as we head into Brazil’s 2018 Presidential elections.
- On Thursday, the Central Bank of Argentina approved the license for a 100% digital bank, called "Wanap.” The new company will not have branches, it will operate on a platform and provide telephone and/or online consultations but it will provide the same banking products and services (i.e. lines of credit, deposits and investments) as a more traditional bank.
- During her visit to Argentina, German Chancellor Angela Merkel discussed the bilateral commerce and efforts to strike a deal with the Mercosur grouping of South American countries with Argentine President Mauricio Macri.
- In Brazil, large state-controlled companies such as Petrobras, Eletrobras, Banco do Brasil, BNDES and Caixa Econômica Federal reported a combined profit of R$10.48 billion. That was up 1,997.8% from the R$500 million of net income posted by the companies a year earlier. These conglomerates account for 95% of the net worth and assets of the existing 154 state-owned companies.
- Earlier this week, BBVA Chile announced the launch of new function to its mobile app which allows users to authorize money transfers to third parties via their mobiles, making the process simpler, faster and safer.
- In Mexico, Pemex is targeting 22 new projects in the logistics and infrastructure sector, aiming to support covering a deficit of US $15 billion in investments that currently exist in the country.
- Most recently, the Odebrecht scandal has made noise in the Dominican Republic, where fourteen people have been accused of bribery, association of wrongdoers and illicit enrichment. According to the President of the American Chamber of Commerce (AMCHAMRD), due to the scandal, the international business community will be scrutinizing the Dominican Republic.
- End of Week Market Updates
- Merval (Argentina): - 4.02%
- Bovespa (Brazil): - 0.48%
- IPSA (Chile): - 08%
- IGBC (Colombia): + 0.67%
- IPC (Mexico): - 0.48%
- BVL (Peru): + 81%