Argentina Special: Buy a 4% Bond or Go to Jail

President Cristina Fernandez de Kirchner wants tax evaders hiding about $160 billion in dollars to help finance Argentina’s oil-producing ambitions. Her offer: Buy a 4 percent bond or face the prospect of jail time.

The tax authority announced the plan May 7, highlighting its information-sharing agreements with 40 nations and warning Argentines who don’t use the three-month amnesty window that they risk fines or arrest. Evaders have two options for their cash and the only one paying interest will be a dollar bond due in 2016 to finance YPF SA (YPF), the state oil company. The 4 percent rate is a third the average 13.85 yield on Argentine debt and less than the 4.6 percent in emerging markets.

A year after seizing YPF, Fernandez is funneling more money into the nation’s energy industry as the government struggles to boost production from the world’s third-biggest shale oil reserves. With Argentina already committed to pumping $2 billion of central bank reserves into a fund for energy investments and the highest borrowing costs in emerging markets keeping it from issuing debt abroad, the government is eyeing the billions of undeclared dollars that Argentines hold to help shore up reserves that have dwindled to a six-year low. Read more >>

Argentina: Hundreds of troops deployed to combat looting

Argentine authorities have sent hundreds of troops to the southern city of Bariloche after a spate of looting. At least three supermarkets in the popular ski resort were targeted, causing panic among local residents and tourists.

Dozens of people, many with their faces covered, broke into the supermarkets stealing electronics, toys and clothes. The government blamed small criminal gangs but local authorities pinned the attacks on anarchist organisations.

"With this type of action, these groups have been trying to paint a false picture of social and political collapse," the provincial authorities said in a statement.

Local police said other shops and depots on the outskirts of the town were also targeted by looters. All shops closed after the thefts.

President Cristina Fernandez de Kirchner has been in constant communication with the province's governor, according to her spokesman Juan Manuel Abal Medina.

He said the Bariloche attacks were linked to the sabotage of power lines earlier on Thursday in the neighbouring province of Neuquen. Read more >>

How the Government Will Take Control of Your Retirement Account

In the US, I think retirement accounts will be the first to go. They're the easiest to grab because most people hold their retirement accounts domestically with a large financial institution that will happily sell every customer down the river when the government comes calling.

The way they'll do this is simple-- the next time there's a market meltdown (bear in mind that insiders are selling like crazy right now...), the government will step in with new legislation that requires these institutions to invest a portion of their accounts in the 'safety' of government securities.

Insider politiconomists like Teresa Ghilarducci have already strongly advocated for government managed retirement accounts in the US, and we've seen numerous examples of other bankrupt nations from Argentina to Hungary moving to seize their citizens' pensions. Read More...

Global food chain stretched to the limit

Image by magharebia via FlickrStrained by rising demand and battered by bad weather, the global food supply chain is stretched to the limit, sending prices soaring and sparking concerns about a repeat of food riots last seen three years ago.

Signs of the strain can be found from Australia to Argentina, Canada to Russia. On Friday, Tunisia's president fled the country after trying to quell deadly riots in the North African country by slashing prices on food staples.

The U.N.'s fear is that the latest run-up in food prices could spark a repeat of the deadly food riots that broke out in 2008 in Haiti, Kenya and Somalia. That price spike was relatively short-lived. But Abbassian said the latest surge in food stuffs may be more sustained. Read More...