But the deal has been made. The Sulzberger's have dug themselves into a hole with a 14% interest loan- which is double my credit loan line. But I suppose that just tells you what a mess we are all in when a paper of record in our nation will succumb to such a deal.

As far as his corruption- I will simply state that Slim has made the bulk of his fortune with marginally improved service at the highest rate possible in the world in a monopoly environment. The people of Mexico feel ripped off. When it was a state owned business they felt ripped off. Not much has changed, except that now the richest man in the world is Mexican.

Mexico has had a great deal of corruption for many years, allowing the wealthy protection at the cost of the poor. Our country has profited from their corruption, so we are not much better. I do hope that they survive in the coming economic environment.

 Reply

Most of Slim's money is in AMX, Inbursa, and TMX.

Here is the 5-year return, in dollars, on some of his companies (confession: for the ones traded in Mexico, I am eyeballing the 5-years ago price from a chart; I may have the %s off a bit, but you get my drift:)

AMX (mkt cap $49bn): 251%
TMX (mkt cap $17bn): 151%
Inbursa ($6bn) : 210%
Gcarso ($5bn) : 156%

S&P 500 (5 yr return) : -19%

Mind you, these companies are public, and you could have invested alongside him. I have no idea about his ethics, but it's hard to argue about his track record as an investor.

As far as the $25 million pay-off to politicians, I only know what I read about it in the press. [query.nytimes.com]

Note: This is the only piece of unethical behavior you raised; owning companies is not unethical. Slim was one of THIRTY rich businessmen asked by Salinas to contribute $25m a piece to the PRI, which as you know, had been the sole ruling party in Mexico for all of Slim's life at that time. I don't know if any of them paid it; one was so annoyed at the amount that he leaked the request to the press. I am not naïve enough not to be aware that corruption was - and still largely is - part of Mexican culture. I would not pass out with shock if I discovered Slim had greased some palms along the way.

However, to attribute his wealth to corruption understates his ability as an investor. Unless, of course, you believe his publicly-traded companies are all fronts through which he launders all that drug money Jaime Chico is running on the side for him.

It's easy to create conspiracy theories, and Mexico is full of them. I remember an acquaintance, a high-up PRDista, swearing to me that Slim was merely a front-man for Salinas, who really controlled Telmex. If so, it looks like Salinas is SOL on getting his stake back.

I don't purport to be an expert on Carlos Slim. I have had no business dealings with his companies in years and (alas) don't own his shares. If anyone wants to correct me on anything, I'm always happy to learn from an informed source.

 Reply

Slim has not been a huge success in the States. Prodigy? CompUSA? Why should an investment in a dying newspaper fare better? I still believe you are confusing Slim's very modest HQ on Paseo de las Palmas w/his home address. I'm perfectly willing to be proven wrong. There are a few blocks there where Goldman, Merrill, and JP Morgan all had their offices in the late 90s. Sounds like the address for the NYT bureau too.

@La Mareada: Which grocery chains? My mind is slipping. Also, it is NOT all landlines, it is 90% (wiki). I lived in Mexico before Telmex was privatized. You have no idea how bad the phone system was. I never stayed in one place long enough to have a landline; the wait list was years.

I love how everyone assumes he is a drug dealer with the government in his pocket. Because he must be, because all Mexicans are, right? The fact is, Slim has been public and audited for at least 18 years (and not by Bernie Madoff's "auditors".

The vast majority of his money comes from the Telmex/cell phone monopoly. He had the cojones to put up the money to buy it. If the government was in his pocket that much, how come he has gotten way, way richer as Mexican democracy has increased, with power finally switching between parties?

If you look at a typical list of Mexican corporate tycoons, they all sit on each other's boards and marry their kids to each other. Slim has largely stayed away from the lucky sperm club.

In other words, Slim is the Bill Gates of America. Yes, he has a near monopoly on something vital. From what I know of him, he wouldn't dream of living in a house the size of Bill's.

 Reply