Tupi SEC: New Superintendent of Information Asymmetries

São Paulo elevator news screens (Linux-powered, by the way) are started to pop up in the fancier buildings. “Telefônica denies conversations the Holland’s KPN over a proposed sale” (Friday, October 28). Features a red light-green light (but not yellow-light) heads-up display of traffic conditions on the major roadways that kind of reminds you of the Homeland Security “terror alert level” display (still yellow after these years).

The Comissão de Valores Mobiliários (CVM), Brazil’s securities regulator, announces:

A Comissão de Valores Mobiliários (CVM) informa que a Superintendência de Relações com Investidores Institucionais (SIN) será reestruturada com o objetivo de centralizar em uma única área técnica as atividades relacionadas aos fundos de investimento e seus prestadores de serviços. A partir de 1º de março, Carlos Alberto Rebello Sobrinho assume a SIN, após dez anos à frente da Superintendência de Registro de Valores Mobiliários (SRE).

… that Superintendency of Institutional Investor Relations (SIN) will be restructured with the objective of centralizing activities related to investment funds and their service providers in one technical department. Starting March 1, Carlos Alberto Rebello Sobrinho will take over SIN after ten years as superintendent of the securities registry (SRE).

“Churnalism”

Turtles all the way down: Malcolm McLaren ransom-note aesthetic enjoys revival in Blighty book design circles. Would somebody please smuggle this book to South America for me on the next packet steamer to Santos?

British journalism | Hacks at work | Economist.com: In the course of trying to document for a Metropolitan colleague the informal Colonial terms of art “hack” (journalist) and “flack” (public relations professional), conversation turns to whether the Economist is any good anymore (I hold my hand, palm down, parallel to the floor, and make the wiggling motion denoting ambivalence).

Which leads to this bit of doggerel:

You cannot hope to bribe or twist,
Thank God, the British journalist.
But seeing what the man will do
Unbribed, there’s no occasion to!

It’s a review of a book by Nick Davies of the U.K. Guardian called Flat Earth News.

The Economist manages not to mention the title of the book even once in its review.

The Economist apparently thinks the Five Ws are optional. The name of the book is not as important as what the Economist thinks of the book.

The title does appear in an associated “opportunity to buy” “related items” box on the Web page.

Technical Note: Quote Bloat in Potential Tupi Tie-Up !

“Investors in the Pernambuco Stock Exchange”: I visited the exchange in historic downtown Recife once (the building was colonial and pink) but am so freaking fat in the photo that I hesitate to publish it. Whether Brazilian regional exchanges might someday awake from their provincial torpor is kind of an interesting topic to speculate about, though.

When translating quotes from one language into another, we should do so in an idiomatic way rather than with pedantic literalness. Care must be taken to ensure that the tone of the translation is equivalent to the tone of the original. Beware of translating quotes in newspaper pickups back into the original language of the source. If a French politician gives an interview to an American newspaper, it is almost certain that the translation back into French will be wrong and in some cases the quote could be very different. In such cases, the fewer quotes and the more reported speech, the better. –A Handbook for Reuters Journalism, “Quotes”

Notice to the Market: The Bovespa, Brazil’s main stock exchange, launched an IPO not so long ago, and there has been newsflow in recent weeks according to which it is thinking of merging with the BM&F (”the Chicago Mercantile Exchange of Brazil,” sort of).

Which is certainly not a completely weird thought to have.

After all, at a certain point, the possibilities of a NYSE-CME combination were kicked around, weren’t they?

The Folha de S. Paulo reported such a merger would potentially produce “the second-largest exchange group in the world.”

Then had to run an erratum correcting “in the world” to “in South America” or “in Latin America,” I forget which now.

The CVM, Brazil’s securities regulator, is notably interested in trying to get a handle on rumor mills, disinformation campaigns, and the general employment of noise machinery to clog the gears of the free and efficient operation of the capital markets with baffling bullshit.

See also

• Brazil: “Tupi SEC Targets Journalistic Pump and Dump”

The CVM questioned the exchange about remarks to the press on the matter, and the exchange replied on January 18.

I mostly reproduce it as an exercise in evaluating the quality of newsflow in translation, which is kind of my thing these days (I am doing some modest consulting on this topic these days for the New York office of an investor relations agency that specializes in Tupi public companies.)

Just to make it clear: I do not have any information at all on the substance of the matter in question, and I most certainly would not be telling tales out of school about it even if I did.

Verdict: Not too bad.

We acknowledge receipt and thank you for your referenced [?] letter. In answer to your query [inquiry], we inform you that the headline of the news report published in the January 16, 2008 edition of newspaper Valor Econômico, issue of January 16, 2008, which was worded [read] “Fusão Bovespa-BM&F faz sentido, diz Gilberto Mifano” (“Merger Bovespa_-BM&F merger makes sense, says Gilberto Mifano”), is not an accurate quote quotation of anything the undersigned Gilberto Mifano told the newspaper reporter when he was interviewed [in his capacity?] as chief executive officer of Bovespa Holding S.A.

“Not with a decline, but with a miscalculation”: Apocalypse Dow, Reloaded

Post-hack ergo propter hack?

NewsOK clips the follow-up from AP’s Daniel Sorid to last year’s trading-system glitch at NYSE.

It is encouraging to see someone pursuing a mysterious major malfunction at a strategic tech Big Dig with this degree of doggedness.

Those who fail to learn from major systems malfunctions are doomed to repeat the last voyage of the Hindenburg.

See also

• Deluge! Panic! Chaos! Systems Crash! And Your Blogger Is on the Scene!
• Market Machine Post-Mortem: New Factoids on The Chinese Butterfly Hiccup
• Market Machine Madness: The Aftermath
• “Swiftness of Dow drop due to computers”
• Disorder Management and the Downfall of the Dow: Which Glitch is Which?

The item is from the (non)patented NMM Google News Alert on one of the more interesting words in the English language: glitch.

NEW YORK — With the stock market plunging, and the Dow Jones industrials already down hundreds of points, Wall Street’s most closely watched gauge dropped precipitously, in the process choking off electronic trading systems at the New York Stock Exchange.

Rio: Fudgeships In The Awarding of Judgeships?

Vintage roleta with bichos. Source: Musem of the Policia Civil, Rio de Janeiro

The suspicion is that the content of the exam was leaked to benefit sons, daughters-in-law, sons-in-law and nephews of senior judges of the state court. Among those approved for judgeships by the examination process, seven are related to senior Rio judges.

Lilian Matsuura of Consultor Jurídico (Brazil) reports:

Houve fraude no 41º concurso para ingresso na magistratura feito pelo Tribunal de Justiça do Rio de Janeiro em 2006. Esta é a conclusão do relator do processo sobre o caso no Conselho Nacional de Justiça, promotor Felipe Locke Cavalcanti. O julgamento, contudo, não terminou porque o conselheiro Técio Lins e Silva pediu vista dos autos.

There was fraud in the 41st competitive entrance examination for the judiciary conducted by the state supreme court of Rio de Janeiro in 2006. That was the conclusion of the investigating magistrate for the National Justice Council (CNJ), prosecutor Felipe Locke Cavalcanti. The case has not concluded yet, however, because CNJ councillor Técio Lins e Silva has requested time to review the case file.

Ao ler seu voto de 51 páginas na sessão nesta terça-feira (26/2), o relator afirmou que houve quebra de sigilo do conteúdo da prova, além de diversas outras irregularidades. Com isso, os 24 juízes aprovados, e que estão trabalhando, correm o risco de ter de deixar os gabinetes. Apesar de constar que o processo não foi lícito, Locke não chegou a uma conclusão em relação ao que deve ser feito. Não conseguiu decidir se todos os aprovados devem perder o cargo ou apenas aqueles que se beneficiaram com a fraude.

Reading out his 51-pp. opinion in the Tuesday session of the CNJ, the investigating magistrate said [the contents of the test leaked out], along with other irregularities. With this, the 24 judges approved, who are already at work, run the risk of having to vacate their offices. Although he found that the process was not valid, Locke did not state a conclusion about what ought to be done about it. He could not manage to decide whether all those approved for judgeships should lose their posts or only those who benefited from the fraud.

The CNJ is an independent oversight body for the Brazilian judiciary, established in recent years.

The irritable Maierovitch, a former federal judge and national “drug czar” turned columnist, has questioned in the past whether the oversight is really all that effective. See

• Brazilian Spies and Mafias Columnist: Judicial Self-Regulation is a Freaking Joke

The judiciary has suffered a scandal or two in the last year or so, including two cases from the Rio-São Paulo corridor involving senior judges accused of selling verdicts favoring organized crime interests such as illegal gambling enterprises.

“Legal certainty” seems to have emerged as a major theme at the multilateral donor and credit agencies.

More on that in a minute. The following does tend to leave with the negative impression that some of the judges who might be adjudicating your contract dispute (7 of the  24 candidates approved are related to court members) might be disposed to lie, cheat, steal and otherwise engage in personal conduct not conducive to upholding the fabled majesty of the law in the eyes of its postulants.

As suspeitas eram de quebra de sigilo e fraude para beneficiar filhos, noras, genros e sobrinhos de desembargadores do TJ fluminense. Entre os aprovados no processo, sete têm parentesco com desembargadores.

The suspicion is that the content of the exam was leaked to benefit sons, daughters-in-law, sons-in-law and nephews of senior judges of the state court. Among those approved for judgeships by the examination process, seven are related to senior Rio judges.

Ouch.

So NIRI and Yet So Far

“Sarbanes-Oxley inside!”

This comes to the e-mail inbox from the National Investor Relations Institute (which could really, really use a good copyeditor for its newsletter, by the way).

Too bad we are not in New York. This could be interesting. Seriously. It’s $50, but I bet I could gobble up at least that much in cocktail shrimp and gin.

While investors and analysts continue to rely on traditional print and broadcast media they are also becoming more “new media savvy,” presenting new challenges for the IR professional.

How will the ongoing and inexorable agglomeration of the Reuters-Thomson-NEWS-Dow infotainment complex affect your company’s never-ending battle against the gabbling ratfink and the churning of the rumor mills?

Result: While IROs need to continue to cater to the needs of the traditional media they must also understand how the recent acquisitions and mergers – such as News Corporation’s acquisition of Dow Jones & Co. (including The Wall Street Journal), and Thomson Corporation’s acquisition of Reuters Group PLC – will affect the journalists who cover their industry. IRO’s also need to closely follow Web-based reporting and blogs.

But only the blogs that people whose opinions matter are actually foolish enough to be reading instead of getting serious work done.

São Paulo Diary: Globo Takes a Gamble on Spiderman

The Terraço: slightly decrepit yet strangely graceful landmark across from the desert that the Praça da República has become.

As it happens, Robert had contacted the Globo network’s Fantástico and invited it to televise the stunt live — and according to him, the TV equipment is what tipped the security guard off.

He said his sponsors pay him the value of a luxury car for every climb, but asked that the exact amount not be published. His São Paulo adventure was bankrolled by the online casino Golden Palace.

Golden Palace, the online casino that grew their fame by utilizing odd advertising schemes, pleaded guilty yesterday to charges of illegal online gambling in Quebec, Canada. –Casino Gambling Web, November 30, 2007

Maguila, o segurança, frustra a ”vingança” do Homem-Aranha: “Magilla [the Gorilla] the security guard thwarts ‘revenge’ of Spiderman.”

I read it in the print edition of the Estado de S. Paulo on the CPTM commuter train on my way back from Lapa — transferring at Barra Funda — where I have gone to see the feds about my visa and application for permanent alienhood.

As Chico Buarque says,

Eu fui pra Lapa mais perdi a viagem …

But that is another story.

In this case, a Frenchman known for accepting corporate sponsorship to scale tall buildings is prevented from scaling the Terraço Italiano — its rooftop restaurant is a lovely spot — after tipping a team from the Globo TV network he would be trying it.

The Globo team hems and haws and argues that it was merely there to provide (exclusive) “serious” journalistic coverage of [an event of compelling public interest] [a garden-variety ("Drink Slurm!") paid publicity stunt] [a publicity stunt paid for by a criminal organization.]

Magilla the security guard pantses the man from France as he makes the attempt.

Maguila nem precisou de superpoderes para vencer o Homem-Aranha anteontem à noite, no Terraço Itália, centro de São Paulo. Tudo bem, ele rasgou o terno. Mas bastou esticar os braços, alcançar o tornozelo do “herói” e puxá-lo até arrancar-lhe as calças. Foi assim, de forma nada heróica, que o francês Alain Robert, de 45 anos - conhecido como “Homem-Aranha” por escalar os mais famosos prédios do mundo -, foi parar no 3º Distrito. Alerta, Adilson Marques da Silva, de 34, o Maguila, impediu que Robert descesse, pelo lado de fora, sem equipamento de segurança, 41 andares do Itália, um dos edifícios mais altos da capital.

Magilla did not even need superpowers to defeat Spiderman the other evening at the Terraço Italia in downtown São Paulo. It is true that he tore his suit in the attempt. But all he needed to do was stretch out his arms, grab the ankle of the “superhero” and pull until he pulled the man’s pants off. It was in this less than heroic fashion that the Frenchman Alain Robert, 45, known as “Spiderman” because of his habit of climbing the world’s most famous buildings, wound up in the 3rd District stationhouse. The alert Adilson “Magilla” Marques da Silva, 34, prevented Robert from descending, from the outside, without safety equipment, the 41 floors of the building, one of the tallest in the city.

Brokerage and Jokerage on the Overnight Flight to Miami

Mug shot of Charles Ponzi, 1920.

Brasil e EUA deflagram operação para combater fraudes no mercado financeiro: The Brazilian feds and the FBI cooperate to bust Brazilian “ghost firms” set up to swindle little old ladies from Pasadena. The Agência Brasil has the story.

Agentes da Polícia Federal (PF) foram mobilizados hoje (25) para desmontar a ação de uma quadrilha que teria obtido a soma de US$ 50 milhões em crimes financeiros contra investidores estrangeiros. Os fraudadores lesaram pessoas físicas e jurídicas de diversos países, principalmente da Inglaterra, Espanha, Austrália, Estados Unidos e alguns países da Ásia, conforme nota distribuída à imprensa pela Polícia Federal.

The Brazilian federal police were mobilized today (February 25) against a criminal organization that had committed an estimated US$50 million in financial crimes against foreign investors. The fraudsters victimized both individual and institutional investors from English, Spain, Australia, the United States, and various Asian nations, according to a press release from [the Tupi feds] today.

A operação, denominada Pirita, foi montada em conjunto com FBI (sigla em inglês para Departamento Federal de Investigação), que cumpriu dois mandados de prisão contra brasileiros, em Miami. No Brasil, a ação ocorre em nos estados de São Paulo e Rio Grande do Sul, onde deverão ser cumpridos 27 mandados de prisão temporária, três mandados de prisão preventiva e 35 ordens de busca e apreensão.

The operation, nicknamed “Pyrite,” was conducted jointly with the FBI, which served two arrest warrants on Brazilian citizens in Miami. In Brazil, the operation is being conducted in São Paulo and Rio Grande do Sul, where 27 temporary arrest warrants, 3 preventive detention warrants, and 35 search warrants are being served.

“Veja Redefines the Boundaries Between Fact and Fiction” (and Attributes the Harry Potter Series to J.K. Howlling)

Os mais vendidos: Brazlian business journalist Luis Nassif continues his critique of the Editora Abril’s Veja magazine.

Nassif believes the magazine’s credibility has been crippled by a year-round carnival of undisclosed conflicts of interest. He reports that the publishing group — which controls 100% of the print distribution in São Paulo now — has SLAPPed him silly with lawsuits over the series.

The latest chapter puns with the phrase “best-sellers” and the notion of “biggest sell-outs.”

Ao longo dos últimos anos, duas vertentes determinaram o aprofundamento da deformação editorial da revista Veja. No comando, Eurípedes Alcântara e suas coberturas estranhas; nas entranhas, Mário Sabino, incumbindo de coordenar a brigada dos “assassinos de reputação”.

Over the years, two factors have played a decisive role in deepening the editorial distortions at Veja: (1) steering the ship, Euripedes Alcântara and his bizarre coverage; and (2) down in the engine room, Mário Sabino, in charge of coordinating the magazine’s “character assassination” brigade.

Eurípedes é o homem dos altos contatos, altamente agressivo, porém sabendo disfarçar. Seus braços na revista são Lauro Jardim e Diogo Mainardi.

Alcântara is the man with the high-level contacts, highly aggressive but able to disguise the fact. His [muscle] inside the magazine are Lauro Jardim and Diogo Mainardi.

Já Sabino é o truculento, uma espécie de cão de guarda feroz, sem escrúpulos nos ataques a terceiros, praticando cotidianamente o ritual da maldade, com uma agressividade quase pornográfica que se propaga por seus três alter egos: Sérgio Martins, Jerônimo Teixeira e Reinaldo Azevedo.

Sabino is a truculent fellow, a kind of junkyard dog who has no scruples about attacking others, celebrating the [black mass] of malice on a daily basis, an almost pornographically aggressive figure who propagates his agression through his three alter egos: Sérgio Martins, Jerônimo Teixeira and Reinaldo Azevedo.

On Azevedo, who is given to bouts of bizarre, hysterical shrieking cribbed from Gnostic religious pamphleteering, see also

• Rio de Janeiro: Colonel Paúl on Veja and the “Counter-Coup”

Guarde por ora essas informações e nomes, enquanto tentamos entender melhor o desastre que foi o fenômeno Sabino para a Veja.

Bear this in mind while we try to understand better the disaster that the Sabino phenomenon has represented for Veja.

O caráter jornalístico

What makes journalism journalism?

Há duas características do jornalismo que ajudam a legitimá-lo. Primeiro, investir contra qualquer ameaça de super-poder. Quando quer fuzilar algum personagem público, um dos expedientes mais utilizados pela mídia é superestimar o poder do alvo. Nas sociedades democráticas, a criação do super-poder (ou do mito) é suficiente para mobilizar a opinião pública contra ele.

Journalism has two qualities that help to legitimate it. First, that it takes a stand against any threat of excessive power. When they want to put some public figure in front of a firing squad, one of the gambits most frequently used by the media is to exaggerate the power commanded by their target. In democratic societies, the creation of an excessively powerful figure (or the myth of excessive power) is enough to mobilize public opinion against him.

See also

• Zé Dirceu, Evil Genius

Rio: “With Batman in the Can, It Hits the Fan”

Recovering two sets of charred remains from the Avenida Brasil after Sunday attack on Palmeirinha, northern zone of Rio. A state police raid the previous Thursday targeted militias in the area. Source: Terra (Brazil), photo by O Dia (Rio de Janeiro).

Rio: grupo invade favela na zona norte e mata 4: The Terra news portal (Brazil) reports that a large, unidentified armed group invades a shantytown in the northern zone of Rio and four die.

Pelo menos quatro pessoas morreram no início da manhã deste domingo quando 30 homens armados invadiram a favela Vila Palmeirinha, em Guadalupe, na zona norte do Rio. Segundo a polícia, desde 2006 milicianos controlam a região. As informações dos policiais indicam que bandidos estariam tentando retomar a favela após a prisão dos milicianos.

At least four persons died early Sunday morning when 30 armed men invaded the Vila Palmeirinha shantytown in Guadalupe in the northern zone of Rio. According to police, a militia has controlled the area since 2006. Police intelligence indicates that “bandits” may be trying to retake control after the arrest of the militiamen.

The Estado de S. Paulo reports 20 invaders.

I do not remember reading that militiamen were arrested in that part of town. But the