Show 6F The Salt Lake Tribune Sunday August 9 1987 Peru Finally Clamps Down on Lima’s Wild Curbside Trading Dollar-Hungr- y By Monte Hayes Associated Press Writer LIMA Peru — Until last week hundreds of young men wielding pocket calculators and fists of bills did a thriving business each day with Peruvians along a narrow V street in Lima’s seedy downtown dubbed had Jiron here Newspapers Ocona “Wall Street’’ — after New York City's financial district — because of the hectic buying and selling that went on there Tuesday however President Alan Garcia announced plans to nationalize Peru's banks to protect the nation’s falling dollar reserves He also shut down Jiron Ocona's curb-sid- e s to tighten controls over the financial system “This decision is necessary to close the escape route for the country's resources and prevent speculation in dollars” Garcia said For many people Ocona had become a barometer of the Peruvian economy But for Garcia’s populist government the unbridled free enterprise of Ocona’s moneychangers was proving a major headache Independent economists say recent heavy trading on Ocona reflected Peruvians’ lack of confidence in their own currency in the face of 100 percent inflation and demonstrated the government’s economic recovery program is threatened by a scarcity of dollars “Here on Ocona is where you see the true value of the dollar” said Jorge la Torre Rivera a business administration student who has been paying for his university studies from his profits as a moneychanger Since April the price of the dollar on Ocona has soared from 21 Peruvian intis to 40 while the government- money-changer- —Associated Press laserphoto Jiron Ocona known locally as Wall Street after US financial district sell dollars to a drive-u- p buyer Money changers on controlled exchange rate at which Peruvians can buy a limited number of dollars has remained virtually unchanged at 16 intis to the dollar Government officials charged that s were unthe Ocona dermining confidence in Peru's currency facilitating capital flight and promoting speculation in dollars instead of savings in intis They also said Ocona was used by drug traffickers to launder hundreds money-changer- of millions of “narco-dollars- ” brought clandestinely into Peru each year to pay for coca paste that is smuggled to Colombia for refining into cocaine Critics ranging from leftist congressmen to business leaders had been demanding that the government entreban Ocona's preneurs and require that dollar transactions be made at the official exchange rate through banks But most independent economists and political analysts warned that any attempt to make Omna's activities illegal could spawn a true black market and increase rather than decrease money-changin- g demand for dollars They also claimed it’s bound to fail Manuel d’Ornellas a widely respected newspaper columnist compared the situation to a mayor's decision some years back to shut down Lima's red light district “He managed to do it but at the price of turning all of Lima pink" d’Ornellas wrote s Instead of operating openly on downtown streets said Ramon Remolina economic adviser to one of Lima’s largest banks “money will change hands at midnight in dark alleys Things will get worse” Peruvians vividly recall the early 1970s when a leftist military government made it illegal to hold dollars Authorities forced open safety depos money-changer- it boxes in banks and confiscated any American currency found Police looking for dollars strip searched men and women travelers at Lima’s international airport A prominent lawyer who asked not to be identified recounted with a chuckle how he smuggled $100 bills out of Peru in toothpaste tubes “I can still picture my wife washing out the bills in our Miami hotel room and sticking them on the walls to dry” he said s Some 300 worked along Ocona street chasing cars that pulled up to the curb and swarming around pedestrians who inquired about the day’s exchange rate for buying dollars They also eagerly awaited the visits of unidentified men who arrived in big cars and sometimes on foot with briefcases stuffed with as much as $50000 to sell “The money must come from cocaine trafficking but we don’t ask r la Torre questions” Rivera said above the din of shouting street vendors and the blaring horns of rush-hou- r traffic a few days before Garcia's announcement The US Drug Enforcement Administration estimates that Colombian cocaine traffickers bring $700 million a year into Peru to buy coca paste Remolina and other economists say the cocaine dollars made up at least 70 percent of the dollars traded on Peru’s parallel currency market Independent economists and business leaders say the government was reluctant to shut down Ocona because the money-changewere an important source of dollars for government coffers “The government lives off that irregular form of obtaining dollars It is in the government’s interest to maintain Ocona because its officials go money-changer- money-change- there to buy dollars for the Central Bank” Herless Buzzio director of the National Confederation of Merchants said in an interview with The Associated Press several weeks ago In a nationally televised address in early July Garcia confirmed that the dollars sold on Ocona “come in great part from earnings from drug trafficking” He also admitted one reason dollars had the rate for shot up in recent months was that the Central Bank had been buying mil- lions of dollars there to replenish rap: idly falling reserves A lack of dollars may prove to be the Achilles heel of Garcia's economic recovery program which stimulated record growth of 89 percent last free-mark- year Latin American currencies are virtually worthless outside their coun- tries and a need for dollars to purchase imports and maintain economic' growth is common to all nations of the region Garcia has limited foreign debt payments to 10 percent of exports and has used the dollars owed to foreign banks to fuel growth But with creditors alienated by his hard line and with a negative trade balance Pe-- ' ru’s dollar reserves fell from a peak of $15 billion in March 1986 to under $800 million earlier this year Private economists say the government is going to find itself in increas- ing competition with individual Peru- vians for dollars despite stricter controls on the financial system The purchasing power of dollars is keeping pace with the country’s 100 percent inflation rate while the maxi- mum interest rate for savings ac-- ’ counts in intis is 22 percent annually’ “Whoever saves in intis is a fool" said Felipe Ortiz de Zevallos director’ of Apoyo an economic consulting firm v NEC PowerMate 80286 COMPUTERS FOWER MATE ‘ mSSDB(ID(D)I£ (Money market accounts) $1000 and up Based on rate of 615 Interest compounded weekly No penalty for withdrawals Insured savings g time certificates! Inquire about our 1 80286 Hard Disk Processor 12 Floppy Disc Controller GW Basic Drive DOS $149500 Enhanced Keyboard 640 KB Memory COUPON BOOK MS $100 32 POWER MATE" 2 80286 810 MHZ 12 FLOPPY DISC HARD DISK CONTROLLER $"fl0Q5°0 ENHANCED KEYBOARD 640 KKB $1 5000 COUPON BOOK ggBBBBSRgm PowerMate "1 NEC high-yieldin- Your Authorized dealer service center GENERAL 3359 So Main DATA SYSTEMS 485-967- 2 & AMERICAN INVESTMENT BANK NA Crossroads Tower 50 South Mam Suite 460 Salt Lake City Utah 84144 801 322 3322 800 453 9494 P-- 6 P-- 7 PINWRITER PRINTERS 52500 62500 PURCHASE EITHER AND GET A 5000 COUPON BOOK Member FDIC : MB is a dim t mhidiiH of Leuudia National Cnrp with asset of over 1 billion dollar Lifted sF fstablidied 1854 CONSOLIDATED REPORT OF CONDITION CONSOLIDATING DOMESTIC AND FOREIGN SUBSIDIARIES OF MKlllY SS&IMM AOTiKTir ZIONS FIRST NATIONAL BANK Consolidating domestic and foreign subsidiaries of the Zions First National Bank of Salt Lake City the state of Utah at the close of business on June 30 1987 published in response to call made by Comptroller of the Currency under title 12 United States Code Section 161 Charter Number 4341 Comptroller of the Currency Twelfth District in STATEMENT OF RESOURCES AND LIABILITIES ASSETS Cash and balances due from depository institutions Noninterest-bearinbalances and currency and coin balances Securities Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and of its Edge and Agreement subsidiaries and in IBFs Loans and lease financing receivables Loans and leases net of unearned income LESS Allowance for loan and lease losses Loans and leases net of unearned income allowance and reserve Assets held ip trading accounts Premises and fixed assets (including capitalized leases) Other real estate owned Intangible assets Other assets Total assets g Interest-bearin- wm ssinnus $1000 minimum Deposit or withdraw serving you throughout New Mexico and Utah KP'mr" ici iffiOv1 rxi’n g 1 806982000 54091 000 1 LIABILITIES n Deposits In domestic offices Noninterest-bearin- at any time without penalty COME TO THE MOUNTAIN Interest-bearin- In g g foreign offices Edge and Agreement subsidiaries and IBFs Interest-bearin- g Federal funds purchased and securities sold under agreements to repurchase in domestic offices of the bank and of its Edge and Agreement subsidiaries and in IBFs Other borrowed money Mortgage indebtedness and obligations under capitalized leases Notes and debentures subordinated to deposits Other liabilities Total liabilities hoi9 EQUITY CAPITAL Common stock 15000000 25251000 97023 000 Surplus 4 SAVINGS AND LOAN ASSOCIATION 4 4® Phone 322 9000 for the offices listed beiow-Mat- n Office 125 S Main St Salt lake City 5th South Branch 490 f Sth South Salt lake City Centerville Branch 323 F Pages tare Murray Branch 125 6100 South Clearfield Branch 75 S State St 825 2227 Ogden Branch 2180 Washington Blvd 399 9216 Payson Branch 201 100 North 465 2596 Orem Branch 48 B University Mall 224 1050 Logan Branch 610 N Mam St 753 5550 E Undivided profits and capital reserves Total equity capital 137274000 Total liabilities limited-lif- e preferred stock and equity capital $2594523000 bank do hereby declare John Henriksen Vice President and Controller of the above-name- d that this Report of Condition is true and correct to the best of my knowledge and belief JOHN HENRIKSEN Vice President and Controller We the undersigned directors attest to the correctness of this statement of resources and liabilities We declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct ROY W SIMMONS DALE W WESTERGARD D GILL WARNER Member Federal Deposit Insurance Corporation Directors ’ |