We didn’t do it, and we promise not to do it again

(Added later:  it occurred to me that the United States expects Mexico to change — or bend — its laws to protect a couple of bankers, but  is unwilling to change or bend its own laws to protect ordinary Mexican citizens in return.  Maybe we can hold Banamex hostage until the U.S. does something serious about its out-of-control gun-running problem, and stop dicking people around down here).

Or, that seems to be the reasoning behind Augustin Carsten’s acceptance of the Banamex situation.  As you recall, the U.S. government now owns a huge chunk of Citibank, which in turn owns Banamex.  However, Mexican law clearly states that foreign governments cannot control a Mexican bank.  Which, right now, they do.

Carstens is claiming this is an exception to the rule, but wants Congress to change the law, illogically claiming, “The law does not cover emergencies derived from the global crisis.”

Uh, no… the law was written to prevent another MEXICAN banking crisis like that in the 1990s, when Mexican banks had to be nationalized, then de-nationalized and sold to the highest bidders (which were usually foreign entities).

What makes Mexican banks safe is not their maddening high credit rates, nor their whimsical attitude towards “user fees”, but that investors and account holders are protected from mismanagement by a simple rule.  If the bank loses money, it’s sold off.  Citibank lost a shit-pile of money.

Citibank is only staying afloat because Banamex was properly managed, and has to be propped up by the United States government.  So, to avoid the failure of a foreign bank, the Mexican government risks the failure of a Mexican bank (and having to invoke even more serious legal remedies)  by changing existing laws to fit the kind of situation that the law was designed to prevent.

No, I don’t understand that either.  Neither does Inca Kola News, which understands a lot more about banks and money than I do.