TEHRAN, Iran — Labor strikes Nationwide protests Bank failures



FILE- In this Jan. 5, 2018 file photo, Iranian senior cleric Ahmad Khatami delivers his sermon during Friday prayer ceremony in Tehran, Iran. In recent months, Iran has been beset by economic problems despite the promises surrounding the 2015 nuclear deal it struck with world powers. (Ebrahim Noroozi, File/Associated Press)
 March 10 at 4:29 AM
TEHRAN, Iran — Labor strikes. Nationwide protests. Bank failures.In recent months, Iran has been beset by economic problems despite the promises surrounding the 2015 nuclear deal it struck with world powers.

Its clerically overseen government is starting to take notice. Politicians now offer the idea of possible government referendums or early elections. Even Supreme Leader Ayatollah Ali Khamenei acknowledged the depths of the problems ahead of the 40th anniversary of Iran’s Islamic Revolution.

“Progress has been made in various sectors in the real sense of the word; however, we admit that in the area of ‘justice’ we are lagging behind,” Khamenei said in February, according to an official transcript. “We should apologize to Allah the Exalted and to our dear people.”

Whether change can come, however, is in question.

Iran today largely remains a state-run economy. It has tried to privatize some of its industries, but critics say they have been handed over to a wealthy elite that looted them and ran them into the ground.

One major strike now grips the Iran National Steel Industrial Group in Ahvaz, in the country’s southwest, where hundreds of workers say they haven’t been paid in three months. Authorities say some demonstrators have been arrested during the strike.

More than 3.2 million Iranians are jobless, government spokesman Mohammad-Bagher Nobakht has said. The unemployment rate is over 11 percent.

Banks remain hobbled by billions of dollars in bad loans, some from the era of nuclear sanctions and others tainted with fraud. The collapse last year of the Caspian Credit Institute, which promised depositors the kinds of returns rarely seen outside of Ponzi schemes, showed the economic desperation faced by many in Iran.

Meanwhile, much of the economy is in the grip of Iran’s security services.

The country’s powerful Revolutionary Guard paramilitary force, which answers only Khamenei and runs Iran’s ballistic missile program, controls 15 to 30 percent of the economy, analysts say.

Under President Hassan Rouhani, a relatively moderate cleric whose government reached the atomic accord, there has been a push toward ending military control of some businesses. However, the Guard is unlikely to give up its power easily.

Some suggest hard-liners and the Guard may welcome the economic turmoil in Iran as it weakens Rouhani’s position. His popularity has slipped since winning a landslide re-election in May 2017, in part over the country’s economic woes.

Analysts believe a hard-line protest in late December likely lit the fuse for the nationwide demonstrations that swept across some 75 cities. While initially focused on the economy, they quickly turned anti-government. At least 25 people were killed in clashes surrounding the demonstrations, while nearly 5,000 reportedly were arrested.

In the time since, Rouhani has suggested holding a referendum, without specifying what exactly would be voted on.

“If factions have differences, there is no need to fight, bring it to the ballot,” Rouhani said in a speech Feb. 11. “Do whatever the people say.”

Such words don’t come lightly. There have been only two referendums since the Islamic Revolution. A 1979 referendum installed Iran’s Islamic republic. A 1989 constitutional referendum eliminated the post of prime minister, created Iran’s Supreme National Security Council and made other changes.

A letter signed by 15 prominent Iranians published a day after Rouhani’s speech called for a referendum on whether Iran should become a secular parliamentary democracy. The letter was signed by Iranians living inside the country and abroad, including Nobel Prize laureate Shirin Ebadi.

“The sum of the experiences of the last 40 years show the impossibility of reforming the Islamic Republic, since by hiding behind divine concepts … the regime has become the principal obstacle to progress and salvation of the Iranian nation,” read the letter, which was posted online.

But even among moderates in Iran’s clerical establishment, there seems to be little interest in such far-reaching changes, which would spell the end of the Islamic Republic. Hard-liners, who dominate the country’s security services, are adamantly opposed.

“I am telling the anti-Islamic government network, the anti-Iranians and those runaway counterrevolutionaries … their wish for a public referendum will never come true,” Tehran Friday prayer leader Ayatollah Ahmad Khatami said Feb. 15, according to the state-run IRNA news agency.

Yet there are signs that authorities realize that something will have to give. Khamenei’s apology in February took many by surprise, especially as the country’s true hard-liners believe he is the representative of God on earth.

Khamenei’s apology came after a letter from Mehdi Karroubi, an opposition activist who remains under house arrest, demanding that the supreme leader take responsibility for failures.

“You were president for eight years and you have been the absolute ruler for almost 29 years,” Karroubi wrote in the letter, which was not reported on by state media. “Therefore, considering your power and influence over the highest levels of state, you must accept that today’s political, economic, cultural and social situation in the country is a direct result of your guidance and administration.”

Iran’s former hard-line President Mahmoud Ahmadinejad, blamed by many for the country’s economic woes, has come out for early elections. He also demanded they be “free and fair,” while continuing his own campaign against Khamenei, whom he ignored in his attempt to run in the 2017 presidential election.

However, Ahmadinejad’s action drew immediate criticism, as his own widely disputed 2009 re-election sparked unrest and violence that killed dozens.


Gambrell reported from Dubai, United Arab Emirates.

Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

How Does Centrally Planned China Raise Capital?-Answer, Hong Kong



Investing #MarketMoves

How Does Centrally Planned China Raise Capital?

I write financial newsletters for investors on how to profit in Asia.  Opinions expressed by Forbes Contributors are their own.

A general view from Victoria Peak shows Victoria Harbour and the skylines of the Kowloon district (background) and Hong Kong island (foreground) on July 3, 2017. (ANTHONY WALLACE/AFP/Getty Images)

Through careful planning and strategic economic policy reforms, mainland China has evolved from a country struck by poverty to the world’s second largest economy. But don’t think this was solely the Chinese bureaucrats’ doing.  The U.K.’s special “present” to China proved to be essential to the story of China’s miraculous development.

In 1997, Tony Blair, who was U.K.’s prime minister at the time, went to Hong Kong to give the city back to Beijing. 156 years of colonial rule had completely transformed the city.

What was once a backwards fishing village, was now one of the worlds’ most important financial hubs.

Hong Kong currently has the highest concentration of international banks in the world. The 71 largest international banks and almost 300 international fund management companies are housed in Hong Kong. The island also has most beneficial legal regulations for both residents and companies.

China basically saw Hong Kong attending a 150 yearlong financial course. The financial powerhouse now belongs back to the Middle Kingdom that uses it to funnel foreign capital into its centrally planned economy. Something the mainland wasn’t able to do by itself.

Never before has a centrally planned economy ever received such a precious gift as Hong Kong.

How Hong Kong feeds China

Companies in planned economies – like China’s – typically have a hard time raising capital. That makes Hong Kong a key factor in China’s economic development.

With its leading financial institutions in place, Hong Kong is able to raise capital unhindered by political or economic instability. A problem free market economies like in the U.S. generally have to deal with.

Four years before Hong Kong was given back to China, it was responsible for 27% of China’s GDP. Let’s put this in perspective. At the time, only 6.5 million people lived in Hong Kong while mainland China had a population of 1 billion people. It’s easy to see that Hong Kong’s impact on China’s economic growth was tremendous.

The mainland did catch up over time as the graph below clearly illustrates. By 2017, Hong Kong accounted for merely 3% of the GDP.

One Road Research

Hong Kong’s Share of China’s GDP

Hong Kong’s return in 1997 coincided with the dramatic rise of China’s GDP.

One Road Research

China’s GDP in Current US$

China’s economic growth was partially due to twenty years of export-oriented policies from Beijing. But without Hong Kong’s well-established financial markets, necessary funds couldn’t have been raised.

Welcome to Lawless Latvia



Welcome to Lawless Latvia

Lawless Latvia provides information about Latvian crimes that are ignored by the corrupt media and authorities. Latvia is the offshore banking center for the former Soviet Union, to the detriment of everyone in the world including Latvians and excluding only a few Oligarchs. The EBRD, EU, IMF, and World Bank are making the problem worse by funding the Oligarchs, fraudulently in the case of the EBRD. Please like or friend us on Facebook and follow us on Twitter. Learn more about this site »

EBRD openly criminal

The European Bank for Reconstruction and Development is funded by 65 countries with a mission of fostering transparency and democracy in 30 countries.  From 2009 to 2014, the EBRD was caught running a scam with the Latvian government to temporarily cover-up the disappearance of the assets of Parex Bank.  The government claims that Parex collapsed because of the United States and Sweden, however the real recipients of the disappeared assets were likely Russian oligarchs and Latvian politicians.

From 2009 to 2013, the EBRD insisted that it really bought Parex shares and denied rumors that the privatization was planned to be reversed by a secret guarantee (‘put option’) in 2014.  When the Latvian government did reverse the privatization in 2014, proving that the EBRD was lying and the privatization was a fraud, then the EBRD became silent.

However now something amazing has happened.  The EBRD had admitted on its own website that it is offering a fraud service!  This webpage states that the EBRD will buy shares in a company if the seller guarantees to reverse the investment later!  There is only one reason why a seller (for example a national government) would effectively pay the EBRD to temporarily claim to be owner of shares.  This reason is fraud!  Such transactions are completely illegal since they mislead creditors about the true value of the shares, which for a corrupt and looted government company is usually zero.

We wonder how many of the EBRD’s 30 countries currently have false financial statements because of this racket.

EBRD webpage:


pdf in case the EBRD takes down the webpage:

ebrd put option

An $846,000 Inheritance Got Lost In Transit. That Was In February



An $846,000 Inheritance Got Lost In Transit. That Was In February

It has been more than nine months since a family in Canada realized that UPS lost a bank draft worth $846,000 (Canadian) that was sent to an inheritor. So far, the only money recovered is the $32 it cost to ship the document. The family’s bank, TD Canada Trust, has delayed issuing a new bank draft.

Lorette Taylor, who lives in Ontario, was distributing the proceeds from her late father’s estate when she tried to send an inheritance to her brother, Louis Paul Hebert, who lives near Cornwall, Ontario, some 270 miles from the office of the family’s lawyer.

Their story ran on the CBC on Thursday — and within hours, reporter John Lancaster says in a tweet, TD Canada Trust issued a statement on Thursday that read, “It’s clear to us we didn’t get this right along the way and that there was more we could have done to come to a resolution faster.”

Taylor told the CBC that she and her husband, John, went to their longtime bank, TD Canada Trust, hoping to get a certified check for $846,000 Canadian — around $660,000 in U.S. dollars, at today’s exchange rate. But TD employees had a different idea. As Taylor said, given the large sum, “They said a bank draft was more appropriate.”

Bank drafts are generally seen as being one step beyond cashier’s checks, in terms of security and guarantee. In nearly every case, they’re issued to signify that a bank has total control of the money being transferred. And in theory, at least, they’re able to be replaced or reimbursed if an initial draft is lost or destroyed.

An mage taken from a TD Canada Trust error messagethat NPR received when trying to read about how the institution handles bank drafts.

TD Canada Trust/Screenshot by NPR

We can’t get more specific about how TD’s Canada operation handles bank drafts, because when we clicked a link in this statement on its site to “find out more information about purchasing a draft,” the site returned a page stating, seemingly without ironic intent, “The document you requested cannot be found.”

The Taylors’ bank draft never made it to Cornwall. UPS says it was able to track it to Concord, north of Toronto. But after that, the shipping company says, the trail turns cold. In February, TD Bank said the draft could be canceled — but only if the Taylors signed an indemnity agreement.

“Essentially, the bank wanted to hold Lorette — the executor of her father’s estate — liable for life if the draft was cashed illegally,” the CBC reports. Under the terms, the liability would extend to Lorette’s spouse and heirs.

Lorette Taylor eventually signed that agreement; the bank still did not produce the funds. TD officials told the Taylors that they would need to secure the balance of the draft further, by taking a lien on their home. To that, they refused.

“If the bank really wants indemnity,” she said in explaining her thinking to the CBC, “then UPS should sign it.”

There may now be new hope of a deal being reached, particularly as TD Canada Trust has issued a new statement as the story has won a wide audience in Canada and beyond.

But Hebert, 61, who went to the UPS store to await his hefty check back in February, is still waiting.

“TD has the money” he told the CBC. “The money is actually sitting in an account with TD. Nothing has been stolen. It’s there. That’s my inheritance.”

Every day, Hebert said, he kicks himself for not simply driving to pick up the bank draft.

Discussing the difference the money could have made, he said, “I would have been retired.”

(Our Future/Poem) Green Paper Adios, Hello Computer Chip



Green Paper is the bread of life these days

Example: Farm living is not a life that’s easy of free

Land, every acre cost so high, worth it to see the Stars

Cities traffic, years in your seat and fumes in your eyes


Do not pretend that the poor in NYC can actually afford the price to live

In the country seldom do you pay a penthouse price for a cup of tea

For some to love you these days, depends on the value of the fleece

Love should not be conditional upon buying Boardwalk and Park Place


The cost of life, chasing the Green Paper the cost is oh so high

No one these days willing to sacrifice like the love of a Farmers Wife

Get up before the Sun, work the fields till dark, then the house work begins

Green Paper makes us like Mice in a game, if you are breathing you play


Remove the Green Paper for the convenience of a painless little Chip

What could be safer for all of our personal life, all our info on a Chip

Identity theft, forgery, counterfeiting, immigration problem now solved

Green Paper worthless, now the age of the Chip, can you feel your death


Was it all a dream, did we the people really just give up without a fight

One World Order, do you ever ponder whether Good and Evil really exist

Is there really some among us who would truly forgo their given time

Green Paper, Computer Chips, Friends, are they the future of our daily life


Some Of China’s Neighbors Are Saying No Thanks To China’s Money




More neighbors are saying “no thanks” to Chinese money—for now

December 04, 2017

There’s a learning curve to becoming a superpower, as China, having recently suffered setbacks with two of its neighbors, is learning.

Pakistan and Nepal, each involved in China’s Belt and Road initiative, a massive infrastructure push, announced last month they would no longer seek Chinese funding for two large-scale developments. In mid-November, Pakistan said that China’s conditions for financing the long-delayed $14 billion Diamer-Basha dam on the Indus River—part of the roughly $60 billion China-Pakistan Economic Corridor—”were not doable and against our interest,” including as it did China taking ownership of the entire project. Pakistan decided to go ahead with the dam, but to build it by itself.

Around the same time, Nepal decided to stop the $2.5 billion Budhi Gandaki hydropower plant from going forward in the hands of China Gezhouba Group, citing irregularities and the lack of a competitive bidding process. Last week, Nepal said that it would go ahead and build the dam itself, handing the 1,200-megawatt project over to the state-owned Nepal Electricity Authority.

“Very early on the countries along the Belt and Road initiative were at first very excited and happy about Chinese investment,” said Christopher Balding, professor of economics at Peking University HSBC Business School. “But there have been significant changes: Countries now look at how China has behaved with Sri Lanka or with Mexico.”

China, with about 60 other nations, pursue ambitious plans to connect three continents with infrastructure investments.
An ambitious Belt and Road initiative. (Source: The Economist)

In Sri Lanka, the Hambantota port is now on a 99-year lease to China Merchants Port Holdings, which has a 70% stake in the venture. In 2015, Sri Lanka sought a review of how construction of the port had been awarded and halted its development. But in the face of economic and financing difficulties, it backtracked. With some $8 billion owed to China, thanks to loans taken to rebuild after its civil war, Colombo agreed to convert some of this debt into equity in projects.

Further afield, China has asked Mexico for a $600 million refund (link in Spanish) for the scrapping of a railway project.

While most countries along the Belt and Road initiative welcome foreign investment and assistance in building modern infrastructure, the pressure being exercised by Beijing doesn’t always go down well. Countries on the receiving end of Chinese cash are starting to realize that when all is done and dusted, the infrastructure that is built is likely to end up controlled by China.

A common pattern has been for China to sign controversial projects when a pro-China government is in place—as was the case with Sri Lanka’s former president Mahinda Rajapaksa and the Hambantota port deal—only to see them revisited once less receptive administrations are in power. In Nepal, outgoing prime minister Pushpa Kamal Dahal, chairman of the Communist Party of Nepal (Maoist Centre), signed a preliminary agreement for the dam in June, just days before he relinquished his post to the rival Nepali Congress as part of a pre-existing power-sharing agreement. Current deputy prime minister Kamal Thapa criticized and scrapped the project for not having gone through open bidding as required by law.

That said, China’s rise in Asia and the world is beyond dispute—and its might is likely to grow as it proceeds firmly with its Belt and Road initiative. And in several countries in Asia and elsewhere, particularly those facing global criticism on human rights or other issues, China’s infrastructure spending plans and hands-off stance on such touchy topics are likely to overcome any reservations toward the country.

Take the example of nearby Myanmar, which in 2011 saw the cancellation (paywall) of a major Chinese hydroelectric project in the face of environmental concerns. In the years since then, Myanmar has been on the receiving end of increasing international criticism due to its purges of the Muslim Rohingya minority. Criticism deepened this year after a particularly harsh pogrom in August saw more than half a million flee to neighboring Bangladesh.

In the same month that the nonprofit Fortify Rights and the US Holocaust Memorial Museum released a major report documenting killings and rape of Rohingya, and the US made the determination that the Myanmar military is carrying out “ethnic cleansing,” China proposed a Pakistan-like economic corridor crossing the country. China is already helping to build a $7 billion port in Rakhine, the western Myanmar state that has seen the worst of the violence. Last week, as Myanmar continued to face criticism over what many see as a flawed agreement with Bangladesh to accept the return of the Rohingya—one that China may have played a role in brokering—Aung San Suu Kyi was in Beijing for a conference of international political parties, and for more discussion on investment.

China can also take heart that the vagaries of electoral fortune in democracies can sometimes revive projects China wants to back. The fate of the Nepali dam, for example, could change yet again as the country holds parliamentary polls for the first time since the end of its civil war just over a decade ago. The final stage of voting will take place Dec. 7. The two main blocks contesting the elections represent a conflicting set of alliances, with one of them saying that it will, should it win, hand the project back to China.

China Busts a $3 Billion Underground Bank



China Busts a $3 Billion Underground Bank as it Tightens its Grip on Money

Sunday, 3 December, 2017 – 11:00
More than 10,000 people have used an underground bank to effectively funnel billions of dollars out of China. (AFP)
Beijing – Sui-Lee Wee

The money came from all over China — its wealthy southern and eastern coasts as well as the arid northwest — as thousands of people scrambled to circumvent the country’s strict controls on wealth.

In the end, more than 10,000 people had used an underground bank to effectively funnel $3 billion out of the country before the authorities put a stop to it, Xinhua, China’s state-run news agency in November.

The discovery of the underground bank in Shaoguan, in the southern province of Guangdong, demonstrates the furtive lengths that Chinese citizens go to in order to skirt government limits and get more of their money out of the country.

The sums involved are enormous, large enough to not only affect China’s economy but resonate around the world. Two years ago, a loss of confidence in China’s outlook led many of its people to send their money abroad — a flow that helped drive a $1 trillion drop in China’s stash of surplus foreign money. The exodus was enough to darken the country’s long-held image as a major global economic growth engine.

China appears to have since stemmed the surge of money abroad, thanks to an improved economic outlook and tough new efforts to keep the money at home. But the underground bank bust announced Thursday showed the lengths that the authorities will pursue to enforce limits on money leaving the country.

The Chinese police have detained seven people believed to be involved in the bank, according to the Thursday reports. The authorities discovered 148 “illegal and fraudulent accounts” from the bank, involving more than 10,000 people, the Xinhua report said.

Underground banks are illegal but common in China. According to China’s Ministry of Public Security, underground banks handled more than $137 billion in transactions last year. There are also lawful ways of moving princely sums out of China without surpassing government limits: directing money to casinos in Macau — the only Chinese territory where casino gambling is legal — as well as using credit cards to buy luxury goods abroad and purchasing insurance policies that can be cashed out overseas.

China imposes strict limits on how much money can leave the country. Those limits help the government keep a firm hand on the value of its currency, and the Chinese authorities credit the limits with helping keep its financial system steady during emergencies like the 1997 Asian financial crisis and the global crisis that began in 2008.

The government sets a $50,000 limit on the money Chinese citizens can move out of the country in a year, though businesses and those making strategic investments can send out much more.

But growing numbers of people began dodging the limits two years ago, when a stock market crash, a surprise government-led currency devaluation and prospects of slowing economic growth led many to seek safer havens for their money.

President Xi Jinping has made it a top priority to keep more money in China. His government has shut down platforms that trade crypto-currencies; announced controls on outbound investment in property, entertainment and soccer; and imposed curbs on payments overseas.

Much of China’s underground banking activity is centered in cities that border Hong Kong and Macau, special administrative regions of China that are governed by their own laws.

In Shaoguan, the police were alerted to a suspicious bank account that was opened in 2011 in the city by a Mr. Zhong, a resident from the southern city of Zhuhai that borders Macau, according to Guangzhou Daily, an official newspaper. It did not further identify Zhong. After almost no activity for years, there were 121 transactions involving $15 million in 2016, prompting the authorities to look more closely at who was involved.

Ultimately, the Xinhua report said, the authorities discovered that the people running the underground bank had illegally bought and stole the identity documents of more than 200 people to open the fake accounts that underpinned the enterprise. News reports did not disclose detailed information about how the underground bank worked.

The Shaoguan government and the police did not respond to requests for comment.

The trail appeared to lead to Macau, according to the news reports. The suspicious bank account that prompted the investigation was opened specifically for a gambler in Macau called Peng to transfer money, Xinhua said. “Several members of the criminal gang” then converted the renminbi into Hong Kong dollars for Peng, according to the report. Hong Kong has its own currency, which tracks the value of the United States dollar.

The Xinhua report did not offer details about Peng.

Macau is under pressure to keep a tight rein on capital outflows. Most recently, it installed automated teller machines with facial recognition software to monitor transactions for people using Chinese bank cards, according to Macau Daily Times.

The Xinhua report acknowledged that underground banks are “seductive,” especially for people who struggle to get financing, but warned that “the people will suffer tremendous loss” if the banks abscond or cheat their clients.

The New York Times