August 11, 2009

$3 million black market money

Over the weekend, approximately 3 million US dollars were exchanged for Honduran lempiras in the black market. This was such a phenomenal amount that the black market rate dropped from L. 19 per dollar to L. 18 per dollar.

Police are investigating whether there are FARC connections. Changing money at any bank is simple. Since the official bank rate is L. 18.89, there is no doubt that the money came into the country illegally. The exchange rate loss on changing US $1 million at the lowered black market rate versus the bank rate is about US $47,000 so it seems clear that anyone who had come by the money legally would have chosen the bank.

It is suspected that the quantity of cash was needed to 'motivate' and move a large number of protesters to the areas where the OAS delegation was to be. However, the meeting scheduled for tomorrow was canceled by OAS (Organization of American States) after Honduras objected to inclusion of Secretary General José Miguel Insulza in the delegation except as an observer. Instead, the Permanent Council will be holding a closed session tomorrow to discuss the Honduran situation.

Note: I originally heard about this on the television news. It has since been reported in the newspapers:

La Tribuna: “Mercado negro” cambió tres millones de lempiras para financiar marchas

Hondudiario: Unos $3 millones fueron cambiados en el mercado negro para financiar marchas de Zelaya

La Prensa: Más de $3 millones han entrado ilegalmente

El Heraldo: Cancillería: Más de $3 millones se usarían para financiar marchas a favor de Zelaya

Proceso Digital: Denuncian ingreso de millones de dólares al mercado negro, presuntamente para financiar activistas de Zelaya

El Tiempo: Relaciones Exteriores denuncia masiva circulación de dólares

Note that in these articles where they are talking about devaluation or revaluation, they are referring to black market prices, not the official bank rate which has not changed. El Tiempo reports a rate as low as L.17 per dollar, but I heard the press conference and the Minister definitely reported L.18 per dollar.

Note also that La Tribuna article quotes some of the money changers along the Plaza Cívica Francisco Morazán in Tegucigalpa as saying that they've changed no less than US $10,000 per day for the past 30 days, which they consider beneficial (to their business).
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