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Enter The Twilight Zone: World's Biggest Cocoa Exporter Tells Creditors To Legitimize Corrupt President... Or Face Wipe Out
And so things move from the simply violently revolutionary to the outright surreal, and once again they originate in Africa where today's TheOnion reality seems to feel most at home in practice (unlike its mostly theoretical, for now, US counterpart). Ivory Coast, the biggest producer of cocoa, today told bondholders of $2.3 billion in debt that unless creditors legitimize the corrupt incumbent regime, and recognize voted out president Laurent Gbagbo, then the country will not make an interest payment on its bonds which already are in a grace period, and will essentially default, unless the political gridlock is resolved in two weeks. “It’s a joke, right?” said Phillip Blackwood, head of emerging markets at Sydbank A/S, Denmark’s fourth-largest bank and holder of Ivory Coast debt. No, unfortunately it isn't. And just like Tunisia is a harbinger of the food riots to come to the developed world, so Ivory Coast is a leading indicator of how the world's greater debtor - the US Treasury - will one day negotiate with its own creditors. As both countries are bona fide banana republics, it won't be much of a stretch...
More on this macabre comedy from Bloomberg:
Ivory Coast’s $2.3 billion of Eurobonds fell to a record low as a spokesman for Laurent Gbagbo said the country will make a missed interest payment only if creditors recognize him as victor of the disputed presidential November elections.
The debt of the world’s biggest cocoa producer declined 0.3 percent to 37.625 cents on the dollar as of 5:40 p.m. in Abidjan, the commercial capital, according to data compiled by Bloomberg. That drove the yield on the 2.5 percent debt due 2032 up 5 basis points to 16.893 percent.“We did our part of the job and pledged to pay,” Ahoua Don Mello, Gbagbo’s spokesman, said by phone today from Abidjan. “It is now the turn of the lenders to do theirs.” Ivory Coast’s government under Gbagbo will invite creditors to the nation to discuss the terms of the coupon payment, he said.
The West African nation missed an interest payment Dec. 31 on its bonds amid a political standoff over the results of the Nov. 28 election between incumbent Gbagbo, who refuses to step down, and internationally backed winner Alassane Ouattara. Payment terms carry a 30-day grace period. The Central Bank of West African States supported Ouattara at a Dec. 23 meeting of finance ministers of seven member nations, excluding Ivory Coast, giving him control over state reserves previously governed by Gbagbo.
Probably the main take home message here (aside from going long cocoa again in advance of these blasting through the roof again) is that he who controls the army is more powerful than he who controls the central banks... At least in Africa, these appear to be different entities. Not so much in the "developed" world.
Gbagbo, 65, who has ruled for a decade, cites a ruling by the Constitutional Council that annulled votes in parts of Ivory Coast’s north on fraud allegations and gave him victory. Gbagbo has retained the loyalty of the army, while the United Nations, the African Union, the U.S. and France, the former colonial ruler, recognize Ouattara, 69, a former deputy managing director at the International Monetary Fund.
The incumbent is withdrawing money from the Senegal-based regional central bank, Don Mello said today. The bank said only people appointed by Ouattara would be able to withdraw funds. Marie-Laure Digbe, spokeswoman for the bank, was not immediately available to comment, according to a person who answered the phone at her office and declined to give her name.
And what truly makes this situation beyond surreal and positively undescribable, is that bankers chime in with advice to, wait for it, buy the fucking dip.
Standard Bank sees “significant upside potential” if a resolution to the dispute can be found, which may make the country’s debt sub-Saharan Africa’s best-performing international sovereign notes this year.
Ignore the fact that the country is likely about to be next to join the revolution bandwagon:
Ivory Coast’s main opposition group called for a nationwide strike tomorrow to force incumbent Gbagbo to stand down.
“Things are deteriorating,” Blackwood said. “The likelihood points to non-payment.”
Kenyan Prime Minister Raila Odinga, appointed by the African Union to help broker an end to Ivory Coast’s election dispute, will hold further talks with Gbagbo and Ouattara this evening, according to a statement from his office in Nairobi.
We give Gbagbo a week before he follows in Ben Ali's footsteps to the Club Med for deposed dictators (with lots of gold). Or not: according to the WGC, the country does not even have one ounce of gold in its central bank coffers. And we are not sure if various non-extradition countries will accept deposed tyrants in exchange for even a bumper crop of cocoa. Unless, of course, Gbagbo somehow manages to get the price of chocolate to rival that of 24K gold in the next few weeks. Which is why we are sure that Blythe Masters and her team were recently in Yamoussoukro discussing the most effective way to corner the cocoa market (paper Cocoa ETF?), thus getting the price of the sweet powder up by a few trillion percent (in exchange for a nice 25% of all upside going to Jamie Dimon's firm of course).
h/t Mike
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Hahaha!
Paper food ETF DBA looking better every day!
No gold in Cote d'Ivoire... Too bad for you Gbagbo!
Here is a Chilean telling David Rockefeller that he's not welcome in Chile:
http://fedupmontrealer.blogspot.com/2011/01/david-rockefeller-gets-welcomed-in.html
Maybe it has something to do with the alleged Pinochet collaborator who gets in the car with him!
The International Banking Cartel is like The Pharmaceutical Industrial Complex.
They never cure the disease, they only treat the symptoms.
Member banks get a Bail-Out. Sovereign Countries get a Debt-Injection.
...thus getting the price of the sweet powder...
I shall bravely risk getting junked by pointing out that cocoa is a bitter powder.
Like a cow moving its way through the python - here - comes the inflation:
http://www.dailyfinance.com/story/energy-raw-materials-and-medical-costs...
If the new regime wanted to be officially recognized, it should simply offer old-school Swiss banking laws and tell the US and its IRS/DOJ to 'piss off'.
Africa needs a banking haven and the good Lord knows you can't find one in the Caribbean anymore.
How do you think Noriega survived all those years in Panama? Panama only got invaded when Noriega threatened to nationalize the banks.
They can cancel the debt, form a modern army and get some easier "development" money going forward if they just hire the right 3 banks as advisers.
Where is my consulting fee and Rolodex?
This is too rich. I'll just settle for my American chocolate.
An unprecedented disinformation campaign is being orchestrated to justify foreign intervention in the Ivory Coast to unseat the President Laurent Gbagbo and replace him with Alassane Dramane Ouattara, a stooge totally devoted to the interests of multinationals.
Alassane Ouattara is the former Deputy CEO of the IMF, and former Prime Minister of Houphouet-Boigny who in 1990 administered an IMF plan which plunged the Ivorian people into a profound social and economic distress. He is the puppet "nominated" by the major powers to lead the Ivory Coast and to ensure that their interests are not threatened by the presence of uncompromising and patriotic men such as Laurent Gbagbo, a longtime opponent of Houphouet (1970-1990's.)
French and American imperialist powers have agreed to remove Gbagbo who is guilty of pursuing a national policy prejudicial to their profits.
After years of negotiations following the failed coup d’états in 2002 and 2004 both orchestrated and financed by Alassane Ouatarra mentors (mostly composed of the French governing body as well as private investors but also African head of states such as Wade of Senegal and Compaore of Burkina Faso) the warring parties finally agreed to hold a presidential election whose second round was held last November 28.
The US and France" represented" by a UN mediation team have tried to validate in every way possible an alleged victory of Ouattara. In defiance of the Ivorian Constitution which provides that the proclamation of election results is the responsibility of the Constitutional Council, this commission declared Ouattara winner without adducing any serious evidence.
The U.S., France, followed quickly by the Ban Ki Moon of the UN have rushed to recognize Ouattara as the new head of state of Ivory Coast. The international propaganda machine soon launched a campaign to justify this action. Neither China or Russia, or India, or many countries in Africa, Asia and Latin America, which together form the 3 quarters of the world's population, had a say.
In short, the "international community" is composed of those in the UN that have enforceable words namely The U.S., France, Germany, Great Britain; the same handful of colonial and imperialist powers that have precipitated people twice in two dreadful world wars to get their hands on the markets and fields of raw materials, oil and gas.
In the mass media Ouattara is presented as "the democratically elected and recognized by the international community after announcement of election results by the Independent Electoral Commission." When the Constitutional Council is referred to, news agencies routinely add the words "favorable to Gbagbo" to remove any credibility from this institution declared officially.
Everything is said and Gbagbo must leave "before the end of the week" threatens Sarkozy. The war perpetrator in chief who cannot forgive Gbagbo for opening the oil markets to American companies in 2002. It was a crime to have opened the preserve of French capitalists to others!
Another intolerable offense was that Gbagbo dared to open the roads leading to oil in the Gulf of Guinea to emerging rivals such as China and Russia! To inflict deserved correction, Sarkozy has rallied to the U.S to crush the recidivist offender Gbagbo and in the process any eventual nationalist leader that would dare frolic with" their oil reserves and minerals"
IT'S THE OIL STUPID
We would fully grasp the relevance of the Ivorian struggle once we have realized that the bottom line lies in the following question: Who will control the oil discoveries off the coast of this country?
Who is the man to turn to for the perpetual control of Ivory Coast in its state of neo-colony, 50 years after the country’s formal independence was achieved without struggle and sacrifice? Beyond the Ivory Coast, the neo-colonialists are most afraid that this resistance spreads to former French colonies and that "La Francafrique" is led to affirm its desire for true independence beginning with the denunciation of the puppets of the great French bourgeoisie.
The slogan "respect the democratic choice of the people" is a mockery coming from the leaders of the imperialist powers which have orchestrated, covered up and sustained cruel dictatorships around the world as long as their capitalists 'businesses prospered.
In all cases, although Gbagbo has close links with the French Socialists, who have shun their zeal to defend the neo-colonialist, even if his past alliances allow small casts of doubt on the objectives he defends; the struggle that ensued between the imperialist powers and the great mass of the Ivorian people, appalled by the arrogance of the former colonizers still opt to no longer tolerate the domination and exploitation they have endured for decades.
This struggle is creating a movement that transcends all petty calculations of politicians.
They have served ultimately to act as a detonator in a region that has become a linchpin in the struggle for the energy resources in Africa. Imperialism wants to inflict a lesson on the people. It wants to cut short the Ivorian fight for freedom to deter other nations of Africa.
Assuming that Ouattara had won few votes at the elections with great financial and media support from his imperialists mentors, the historical legitimacy is not on his side. It is not on the side of the minions of the ruling classes.
Legitimacy is on the side of the people who shake the shackles of domination and leaders who lead them in their struggle. The great leaps toward progress are not decided at the polls.
Obviously, the struggle is just beginning in Côte d'Ivoire.
I thought Apple was the World's biggest Cocoa exporter.
The iCoast has been a hotbed of political unrest for some time now. Of course any news about its markets will seem surreal.
Anybody holding iCoast debt and looking surprised should be given a good shake.
"Worlds's Biggest Cocoa Exporter Tells Creditors to Legitimize Corrupt President... or Face Wipe Out"
"Microsoft CEO Ballmer says Obama tax hike would move Microsoft jobs offshore"
Same, same.
http://www.macdailynews.com/index.php/weblog/comments/21346/
"Failure to raise the debt ceiling may cause me to blow up America." Timmy G.
Don't read ahead in the script.
We don't negotiate with terrorits.
$2.3B is chump change. The Bernank will buy them.
I read the OP and seriously thought, "Is this going to hurt the holders of Ivory Coast bonds?" Oh, moral hazard....
That's Mr. Banana Republic, we have nukes!
Or Rousseff ...
SÃO PAULO, Brazil—This week's expected increase in Brazil's already towering interest rates highlights inflation concerns in Latin America's biggest economy and the difficulty President Dilma Rousseff faces in trying to reduce rates to levels more in line with those of developed markets.
Shortly after her election in October, Ms. Rousseff said she saw no reason why Brazilian rates, the highest of any major economy, couldn't "converge" with rates in the developed world.
But creeping inflation, fueled by a fast-growing economy and huge increases in government spending in recent years, leaves Brazil's central bank with little choice but to keep pushing rates higher, economists say.
Analysts expect policy makers, after a two-day meeting ending Wednesday, to push the benchmark rate to 11.25%, up from the current 10.75%.
Further rate increases could follow as the central bank, which enjoys de facto autonomy from the administration, gauges inflationary pressure later in the year.
The dilemma for Ms. Rousseff hinges on what economists, investors, and the local business community have long criticized as a handicap in Brazil's economic-policy mix.
By relying too heavily on the central bank to control inflation—through interest rates and other measures to stem private spending—Brazil's government gives itself an excuse to spend more than it otherwise could.
"There must be a shift away from relying so much on monetary policy," said Neil Shearing, an economist at London-based Capital Economics, a research firm. "At some point, there needs to be a move toward fiscal discipline."
http://online.wsj.com/article/SB1000142405274870402970457608807426521536...
What do the years 1971, 2003 and 2010 have in common? In each year, low U.S. interest rates and the expectation of dollar depreciation led to massive "hot" money outflows from the U.S. and world-wide inflation. And in all three cases, foreign central banks intervened heavily to buy dollars to prevent their currencies from appreciating.
When central banks issue base money to buy dollars, domestic interest rates are forced down and domestic inflationary pressure is generated. Primary commodity prices go up quickly because speculators can easily bid for long positions in organized commodity futures markets when interest rates are low.
http://online.wsj.com/article/SB1000142405274870440570457606425278242193...
You're looking for who to approve what?
Jesus H. fucking Christ on a crutch, I've heard of some nonsensical, asinine, dumb-ass, fucktarded bullshit before, but this takes the cake. This confirmins, removing any residual suspicions as to why the rest of the world looks upon these people as absolutely fucking hopeless.
These people get to vote in the UN!
Well, I'll show everybody. If the ECB doesn't credit my personal checking account with 100 million Euros before the sun rises upon the third rivet head from the top on the upper left pillar of the Eiffel Tower, I'll disapprove of any EU parliamentarian not shaving their nut-sack before Shrove Tuesady's Shroud of Turin Giveaway.
Fucking amazing.
I stand in awe.
Hank Paulson extorted a lot more than that.
Damn. You're right.
Even stuffing me and those buggers from the Ivory Coast into the same Christmas stocking and we're still odd lots compared to Hankiepanky.
But not to forget, Armajaro, the UK commodities trader in like 2002 and then somebody else in recent years took humongoloid positions in the cocoa market.... believe it was the deliverable warehouse supply.
Who knows, maybe this is another big time Arkansas Perdue like chicken futures stuffing contest.
Fine by me. I'm trying to cut back anyway.
"Sha-na, they bought their tickets... they knew what they were getting into... I say, let 'em crash."
Is this really amazing? I thought so too, at first. But how is this any different from the U.S., except being more honest?
We keep electing new representatives, and they keep doing what the bond holders want.
Whoever has access to the credit markets is who apparently rules the nation. A variation of Rothschilds' words. But just a rather blatant, and unfortunate, example of it.
And yep...
You guessed it.
AUD/USD, EUR/USD, etc. are up on this news, dragging and kicking the ES futures up in the process.
I love the smell of ... " anticipated pomo " pre-market.
And can things really be that bad in China ... some just shrug at the inflation talk.
Ferrari sells 999th car in China
http://www.reuters.com/news/video?videoId=178158164&feedType=VideoRSS&fe...
Screw with the price of cocoa and you are toast, say the chocloate lovers.
They can trade coca for gold.. and gold for oil.. and back again.
What has more value? an oz of blow? an oz of gold? a couple diamonds?
Sounds like business as usual for them..
Shit won't get real. Shit must transform.
Shit just got surreal!!!
Hershey's kiss of death. Number 1 new product for 2011.
Is this where the chocolate rationing starts?
Wanna see a riot? - start rationing chocolate to 310 million Americans
These threats are only credible if they have alternatives. What will this stupid fuck do with the cocoa if they call his bluff? I think he's coo coo for cocoa.
TPTB will gladly suffer a dictator if it suits their aims, but get in the way and your life expectancy gets short real fast. He's gone full retard. Never go full retard.
Yes, we have no bananas... or cocoa
What we got here is one shitty banana split.
- Côte d’Ivoire … 1.3 million tonnes (37.4% of world’s total of 3.5 million tonnes)
- Ghana … 720 thousand tonnes (20.7%)
- Indonesia … 440 thousand tonnes (12.7%)
- Cameroon … 175 thousand tonnes (5.0%)
- Nigeria … 160 thousand tonnes (4.6%)
- Brazil … 155 thousand tonnes (4.5%)
- Ecuador … 118 thousand tonnes (3.4%)
- Dominican Republic … 47 thousand tonnes (1.4%)
- Malaysia … 30 thousand tonnes (0.9%)
http://www.suite101.com/content/top-cocoa-chocolate-exporters-a25974#ixzz1BMlx9LOSA sure sign of things gowing down the drain:
WallStreet traders sniffing cocoa lanes at parties.
please use spell check.
Please use sense of humor.
"I and this army."
Yep, sounds like a negotiating strategy the U.S. could use.
I accidently the whole hercules and 5 of the chinooks.
http://en.wikipedia.org/wiki/List_of_aviation_accidents_and_incidents_in...
Love how France turns up at the tipping points in world history.
Not saying they were the primary cause of any or all of this but just when I hear France is involved in any way it seems to be the next step down, the tipping point. Is France the butterfly in the chaos of world finance?
Link to story on Creditanstalt. This was the next leg down in the Great Depression leading to the low in the Dow in 1932 and FDR defaulting on debt by revaluing (confiscating) gold domestically in 1933. See if you can spot France, they didn't do much but don't turn the desk fan on, in a house of cards...
http://www.creditwritedowns.com/2009/03/1931.html
From: @ubs.com
Sent: November 10 2010
To: FredQuimby
Subject: How to bet on price of COCOA going up?
Hi Fred,
Thank you for your request.
Cocoa: There are no leverage UBS products available on Cocoa.
check out www.payoff.ch There is a leverage product "mini future" on LIFFE Cocoa Future. It is a different product than warrants (no maturity, but leverage/financing level/stop loss) in the construction of the product.
- leverage factor 4.46 Val. 10409803 (bid-ask spread 4%)
- leverage factor 1.81 Val. 3615068 (spread 1.21%)
- leverage factor 2.68 Val. 4900271 (spread 1.32%)
- leverage factor 3.99 Val. 10183278 (spread 3.43%)
important: you need to understand the products.
---------------------------------------
If only I were a hedge fund.....
Gbagbo is histroy, he isn't going to be the one making any decisions about anything.
How do we know Gbagbo isn't telling the truth? The article says "internationally backed winner" Ouattara is the winner, but since when does a local election rely on international participants? Second, Ouattara is a former member of the IMF, meaning international bankers want a preapproved banker in the chocolate capital. Would anyone put it past a group of international bankers to rig an African election in order to control the cocoa market? I don't necessarily believe Gbabgo, but I don't believe a Bloomberg article either. This is up to Ivory Coast residents only.
Good point. If GooBagBalls weren't such a comic book character, I'd probably even tuck this one into my tin foil hat band.
Is there any "election" in the world that isn't rigged by the banking elite? Democracy is for the ignorant.
The cocoa will still find buyers, bond debt or not. Default baby!
Unbelievably funny!
"We did our part of the job and pledged to pay"
(so pay )
"Now it's the turn of the lenders to do theirs"
Maybe he expects the bankers to take compensation for the missed coupon to be paid in chocolate dollars?
they have gold coins,
but on inspection its just chocolate wrapped in gold foil
> As both countries are bona fide banana republics, it won't be much of a stretch...
Humm excusez-moi, but isn't this a bit of an oxymoron? Seems like the more central question the opposite - a "lack of" bona fides:
Don't be a in too big of a hurry to buy cocoa...it has an odd way of making it out of the iCoast through its neighbors.
They'll send him a chest full of chocolate gold coins which he'll open, and as he is just forming the words 'what the f....', a couple of helicopter gunships will get up close and personal.
Just buy the fondue dip already!
Higher Hershey prices bitchez