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Who is the boss at Venezuela's Central Bank?

By Alexander Guerrero | El Universal

08.10.05 | Who is the boss at the Venezuelan Central Bank? Apparently nobody. President Hugo Chávez again has his way. This time, he launched an assault on the BCV board; their mouths agape. Subsequently, they learned from the Sunday TV and radio show about the transfer of a billionaire amount of US dollars in escrow in US banks.

US Treasury bonds are a world major financial instrument, not only because of accountancy and transparency of US finances, but also because of their liquidity. Understandably, the Bank of communist-capitalist China holds in US Treasury bonds nothing less than 125-fold the amount of the transfer made by President Hugo Chávez to Swiss banks. These bonds are splendid investment and liquidity instruments.

The board responsiveness has been even more peculiar. They know that the board orders transfer of reserves. Now, they ought to advise the general public and Venezuelan bondholders that, contrary to the president's remarks, a renowned director is responsible for the task. They ought to restore BCV missing trust and institutional rank.

President Chávez does not give a damn. All in all, he has managed a fortune of about USD 150 billion without monitoring. Public branches have failed to account the way of spending the money coming from oil and taxes of laborious Venezuelans. On his tour around the world, he invests, buys and sells, gives, grants, both ready cash and oil. No public branch has exercised any control at all.

Reserves are Venezuelans' assets subject to seizure in an extreme situation, in the event of not fulfilling financial liabilities. This is a remote scenario, at least for financial reasons, but an uncertain one politically speaking.

No international investment bank is ready to believe it. On the contrary, they sell consistently with the demand of Venezuelan bonds, which are much valued due to high oil revenues. Both the Republic and foreign and domestic investment banks are keenly aware of it. In other words, shots are not on this way.

What are the reasons for changing US Treasury bonds and transfer them to Switzerland? Probably, there is no reason. As in previous cases, the moves are political in nature. This is a risky game. People are nervous. Financial events can be anticipated. This is not the case for political milestones.

Translated by Conchita Delgado

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