Something about Finance

The Bank of Mexico cut interest rates to six percent as the economy faces a sever slowdown of its economy. The stock market fell 50 percent in one day and consumer spending is generally down. This is not the first cut, and the addition amounts to a total easing by 225 base points. This is not reflected in the inflation rate, which remains at 6 percent, or the peso, which fell from 9.8 pesos per dollar to 15.6 before climbing to 13. Mexico maintains a goal to slow inflation to 3 percent by 2010. A countrys monetary policy affects it's relations with foreign nations, the domestic consumer confidence and general public support for the government, and the possibility for long term regime stability.

http://online.wsj.com/article/SB123997901566629333.html

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We've Got Our Guns Back, We Promise!

After the semi-succesful meeting between President Obama and President Calderon, Obama stood behind the fact that the United States had successfully "recovered" 90% of the assault weapons that had crossed the Texas-Mexico border, helping to quell the violence and shows the United States dedication to helping it's southern neighbour; however, the 90% is only out of firearms registered with the United States. The true percentage is about 18%.

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Houston Man Convicted for Arming Drug Cartels

John Philip Hernandez, a resident in Houston, was recently sentenced to 8 years in prison for arming drug cartels.  The actual count against him was making a false statement to a gun dealer, which runs about 4 to 5 years standard.  Working through various parties, he accumulated 339 military style weapons over 15 months, claiming that they were all for personal use, and would not be turned over to a third party.  At least 40 of them have already been recovered in Mexico.  His lengthened sentence was because, although he claimed that he didn't know they were going to drug cartels, they are the only serious market for assault rifles and military guns.  Prosecutors felt that he should know that he is only arming hit-men.

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It is from contacts in America that the drug cartels are able to get a majority of their weapons, which undoubtably fuels a fair deal of anger on Mexico's side and thus makes international accords all the more arduous.  Also, we create a sizable market for the drug cartels, in effect fueling the drug wars from almost every angle.  We have never colonized Mexico, but throughout history we have dominated them politically and economically in an extremely one sided arrangement, and only by easing up in our involvement will Mexico be able to develop into a fully industrialized nation.

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Lost in Translation

Obama's visits to Mexico has caused many people's hopes to be raised.  Through assurances of helping the United States southern "partner" and sharing the responsibility for the drug cartels and the war on drugs, it could be that the US and Mexico are starting a "new era" in US-Mexican relations.  Obama and Calderon both made commitments for a new and increased connections in the economy.  However when it comes to real actions, there was little to show.  The Mexicans themselves are happy for now because of the President's expressions of good will, but some commentators are urging the people not to get their hopes up do to previous meeting with many promises turned back on.  Mexico's top two priorities, renewing the assault weapons ban and the restart of the NAFTA pilot program, were left where they were.  Much of Obama's purpose in this visit was to undo the damage done by the previous administrations characterization of Mexico as a failed state.  "Although Mexicans generally saw the Obama visit as purely symbolic, they were gratified that issues such as immigration reform also got an airing. In Mexico, as in Europe, Obama benefits from simply not being George W. Bush."  The visit shows how the United States and Mexico are now going to go forward into a new era of diplomacy and common goals rather than through purely opportunisitic ideologies portrayed by previous administrations

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In Mexico, demand increases for specialization

A new Peace Corps program provides specialized  assitance to Mexico instead of the traditional eager pair of hands.  In this program the Mexican government reviewe the list of approved applicants  and then selected a team of economists and ecologists to assist Mexico's enivironmental agencies.  Generally the volunteers (average age: 48) help the Mexican officals run their own programs instead of doing field work. In Mexico this project is more useful and more likely to endure since it is seen as locally run. Its benefits are twofold : it is good for US-Mexico relations, helps Mexico out, and preserves the environment more effectively.  

This program seems important because it is a program where the US is legitimately actually helping Mexico as opposed to doing little to prevent gun transcations. 

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Got yourself a Gun

The recent spout of drug related violence in Mexico is due to the expiration of a ban in assault weapons trading within the U.S., say members of the calderon government. Estimates on the number of guns imported range as high as 90 percent. This is the subject of the complaint filed by the Mexican ambassador, and while the expiration of the ban may cause resentment on both side, the issue does pose opportunities for cooperation. Obama is visiting the region relatively soon, and the United States has provided eight hundred million dollars in aid. Increasing numbers of armaments is likely to further destabilize the region and regime while decreasing civil participation because they fear for their lives and intact limbs.

http://online.wsj.com/article/SB123956205887011615.html

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A Laundry List of Problems

At last, someone has truly outlined issues in Mexican security and equity, and presented them in a sort of open letter to President Obama.

The article outlines various issues that threaten the welfare of the state of Mexico, including:
- Corrupt court officials that prohibit drug kingpins from being jailed
- No media safety net, as many journalists are taken hostage and/or killed

The article continues on to divide the blame between the United States and President Calderon; the former because of the un-renewed ban on assault weapons and high demand for mexican drugs, and the latter because of his inability to reach out to his "left" allies for help in the time of the country's greatest need.

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Billions in 'Blood Money' Fuel Bloodshed In Juarez, Mexico

Juarez has suffered greatly as a result of the drug violence present in Mexico.  The city has been completely overtaken by the drug war. 2,000 have died as a result of drug violence in the last 14 months.  The army has been occupying the city in a state of martial law for the last six weeks. The mayor had fired half of the police force to attempt to remove corruption,resulting in the deaths of 50 officials. a former mercenary claims to have had help smuggling drugs from us officials on the border. He said the drug cartels have many US officials on payroll and they are known to the cartel members only by number. The FBI has said the corruption from the cartels is on the rise.  Especially as the justice system in Mexico has mostly fallen apart as most cases from 2008 went unsolved.  The Mayor ofJuarez sees a great irony in the continued marijuana usage by Americans and the fact that 90 percent of guns found on cartel members are from the US.

Mexico having even temporily lost a city to complete immersion in drug violence is a very scary thing considering its status is very close to 'failed state'. The US's continuing inability to assist Mexico is severly hurting the Mexicans fight against the drug cartels.

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Millions Gather for Good Friday Pageant

Last friday (Good Friday), a massive re-enactment of the Passion took place all over Mexico, as it has for decades.  As always, the biggest one was located in Iztapalapa, the largest barrio in Mexico City.  Drawing about 2 million visitors yearly, in a tradition going back to 1843, the acting out of the Passion is a major festival which can boast a number of street vendors and even a ferris wheel.  With rainfall at a record low for that area, water itself has become a scarce luxury, but everyone remains cheerful during the Passion.  To play a major part in the re-enactment is a major honor (Diego Zirahuen Villagran Villalobos got the part of Jesus), and people line up for the opportunity even to play Judas.  Altogether, the festival is a yearly, emotional occurrence which draws the people together and helps them forget the misfortune in their lives.

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This festival is a major event with strong ties to Christianity and Catholicism, the predominant religion of Mexico.  It unifies the people in a celebration which permeates geographical separations by drawing on common religious beliefs; as good as the union is, it may later create tensions between religious groups.

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Cap-and-Trade

In an effort to combat global warming around the world, Mexico has joined the multitude of countries now starting a carbon trading market as the crucial part of a cap-and-trade program. This cap and trade program works as follows. There is a limit put on these companies as to how much carbon emissions allowed to escape into the environment. Each company then will have this limit, and those companies that fall below this limit are then allowed to sell the amount that is not being used to a company that is going over the limit. The large scale goal for these programs is to cut in half the amount of carbon-dioxide outputs by 2050, as Mexico's Director of Environmental Issues, Godinez Rosales said.  The main motivation behind these programs is to cut back on the amount of greenhouse gases going into the atmosphere.  The real questions is whether or not it will work to sieze that which caused the problem in the first place, commodity fetishism without a regard for anything else, and use it to turn back the problem.  By using the incentive of the market place, they are motivating the companies with regard to profit.  “We want companies to see climate change as a growth opportunity and a way to improve competitiveness" said Rosales

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Mexico's death cult protests shrine destruction

200 worshippers of the 'Sante Muerte'(Death Saint) marched against the government today against what they saw as religious perscution. However the religion is popular with drug traffickers and soliders often see shrines to the saint on raids. Practioners though believe the saint protects them from a violent death.  Officials have denied claims that they are targetting sante Muerte, but in the past month 30 shrines to the saint(which  consist of marble structures and the sketal figure) have been destroyed.  Protestors carried portable shrines and signs proclaiming their faith to the belief. 

Obviously the government's attempts to crack down on drug violence have become to use more desperate measures creating  negative feedback in an already dissatisfied population. Unforunately there has not even been a positive side to this perscution against 'cultists'. This weakens an already frail sense of legitmacy for the government, which in its struggle for the country is acting against the wishes of some of the population. This suggests to me that the Mexican goverment is willing to sacrifice civil liberites if it means that they can keep a hold on the country.

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And Now for Something Completely Different

Taking inspiration from the United States mortgage bubble, Mexico applied for a 40 billion dollar credit line from the International Monetary Fund. This act will occur at .27 percent interest and will double Mexico's foreign investments. The money is a record setting amount from the IMF, which offers no stipulations or conditions on lent money. This move enhances its comparative credibility with other organizations like the World Bank, and shatters the previous record for a flexible credit line of 27 billion to Brazil. The economic response to the initiative was good; the Peso appreciated 2.7 percent in two days and the country in general appears to be stabilizing economically to a certain extent. The impact on public policy making from international organizations is enormous, as it usually imposes some economic restructuring that may trade off with such basic amenities such as public health, and enhances globalizing pressures.

http://www.forbes.com/2009/04/02/mexico-imf-credit-business-oxford.html

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Death Rates Dropping, Attitudes Rising

Reviewing the figures, it is apparent that the death rates from drug violence in Ciudad Juarez have dropped as of late. In the Jan-Mar period, death rates have dropped 25% from the rates in the Oct-Dec period last year. While they are still double what they were in the Jan-Mar period of 2008, they are a hopeful sign of possible de-escalation in the drug wars. This is the decline hoped for since Mexico sent in troops last month. With this setting the backdrop and joint actions with America looking very possible, things in Mexico may be getting just a little bit better. Maybe.

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In all likelyhood, this statistic means nothing, and all hopes for a quick end are simply wishful thinking. Still, when comparing Mexico to the rest of the world, it is in no way a third world country. With the wealth and political freedoms which many other regimes are unable to match, Mexico's government has a fair deal of legitamacy, and is capable of carrying out changes and policies which just might have some chance of succeeding. Perhaps it's finally working. Or not.

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The Ring..err..Ties of Power!

Attorney General Eric Holder recently met with Mexican President Felipe Calderon and Attorney General Eduardo Medina-Mora.  All parties involved agreed that actions needed to be taken towards the much percieved drug cartel violence sparking all througout Mexico.  However they also refuted the Pentagon claim that Mexico was heading towards attaining the term of "failed state".  On the same schedule was the topic of Colombia, and the rampant drug corruption there as well.  In Colombia, a southern neighbor of Mexico (2 blocks down), corruption is so bad that the leader of the Medellin cartel was just recently elected to Congress.  These drugs are causing problems for both Mexico and the United States.  On the topic of the weakening of the Mexican state Medina-Mora replied, “Mexico has never been a weak state.  It is not today. It will never be in the future. We have faced even more difficult problems than this one. And it is relevant to put this in perspective.”  Adding to this, he said that the purpose of the Mexican war on drugs is to remove from power those who infringe upon the rights of Mexican citizens.  They discussed training Mexican canine teams,  and the US Coast Guard to work alongside the Mexican Navy.  The recent talks between administration of both relevant countries shows the increased diplomacy in the Obama administration and the ability of it to handle a multitude of problems while even in the midst of a global financial crisis.  Alongside this, it shows the Obama administration is adopting new policies that, rather than just putting the US on a world pedestal, raises the entire world onto that same step as well.  The new regime is removing the divide of "Us" and "Them" and allows the US people to see the "Them" as nothing but a different "Us".  “We are going to operate almost like a vise,” Ms. Napolitano said of the United States and Mexico, after the meeting with Mr. Calderón. “We’re going to take out the cartels that have been plaguing our communities for far too long.”  

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