2,500% ROI at this Stock Exchange

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#1
Smile

Somali sea gangs lure investors at pirate lair.


[Image: ?m=02&d=20091201&t=2&i=24197122&w=&fh=&f...-INVESTORS]

(Reuters) - In Somalia's main pirate lair of Haradheere, the sea gangs have set up a cooperative to fund their hijackings offshore, a sort of stock exchange meets criminal syndicate.

Heavily armed pirates from the lawless Horn of Africa nation have terrorized shipping lanes in the Indian Ocean and strategic Gulf of Aden, which links Europe to Asia through the Red Sea.

The gangs have made tens of millions of dollars from ransoms and a deployment by foreign navies in the area has only appeared to drive the attackers to hunt further from shore.

It is a lucrative business that has drawn financiers from the Somali diaspora and other nations -- and now the gangs in Haradheere have set up an exchange to manage their investments.

One wealthy former pirate named Mohammed took Reuters around the small facility and said it had proved to be an important way for the pirates to win support from the local community for their operations, despite the dangers involved.

"Four months ago, during the monsoon rains, we decided to set up this stock exchange. We started with 15 'maritime companies' and now we are hosting 72. Ten of them have so far been successful at hijacking," Mohammed said.

"The shares are open to all and everybody can take part, whether personally at sea or on land by providing cash, weapons or useful materials ... we've made piracy a community activity."

Haradheere, 400 km (250 miles) northeast of Mogadishu, used to be a small fishing village. Now it is a bustling town where luxury 4x4 cars owned by the pirates and those who bankroll them create honking traffic jams along its pot-holed, dusty streets.

Somalia's Western-backed government of President Sheikh Sharif Ahmed is pinned down battling hard-line Islamist rebels, and controls little more than a few streets of the capital.

The administration has no influence in Haradheere -- where a senior local official said piracy paid for almost everything.

"Piracy-related business has become the main profitable economic activity in our area and as locals we depend on their output," said Mohamed Adam, the town's deputy security officer.

"The district gets a percentage of every ransom from ships that have been released, and that goes on public infrastructure, including our hospital and our public schools."

RISK VS REWARDS

In a drought-ravaged country that provides almost no employment opportunities for fit young men, many are been drawn to the allure of the riches they see being earned at sea.

Abdirahman Ali was a secondary school student in Mogadishu until three months ago when his family fled the fighting there.

Given the choice of moving with his parents to Lego, their ancestral home in Middle Shabelle where strict Islamist rebels have banned most entertainment including watching sport, or joining the pirates, he opted to head for Haradheere.

Now he guards a Thai fishing boat held just offshore.

"First I decided to leave the country and migrate, but then I remembered my late colleagues who died at sea while trying to migrate to Italy," he told Reuters. "So I chose this option, instead of dying in the desert or from mortars in Mogadishu."

Haradheere's "stock exchange" is open 24 hours a day and serves as a bustling focal point for the town. As well as investors, sobbing wives and mothers often turn up there seeking news of male relatives missing in action.

Every week, Mohammed said, gang members and equipment were lost to the sea. But he said the pirates were not deterred.

"Ransoms have even increased in recent months from between $2-3 million to $4 million because of the increased number of shareholders and the risks," he said.

"Let the anti-piracy navies continue their search for us. We have no worries because our motto for the job is 'do or die'."

Piracy investor Sahra Ibrahim, a 22-year-old divorcee, was lined up with others waiting for her cut of a ransom pay-out after one of the gangs freed a Spanish tuna fishing vessel.

"I am waiting for my share after I contributed a rocket-propelled grenade for the operation," she said, adding that she got the weapon from her ex-husband in alimony.

"I am really happy and lucky. I have made $75,000 in only 38 days since I joined the 'company'."

(Writing by Daniel Wallis; Editing by Jon Boyle)

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#2
The GOLDEN AGE OF PIRACY HAS COME !!!!

ONE PIECE !!!
Big GrinBig GrinBig GrinBig GrinBig GrinBig GrinBig Grin
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#3
This is both extremely interesting and sad.

Interesting because an actual economy has developed around the proceeds of crime. But in some ways this is no different from other organized crime - people have to live somehow, and there are always those on the periphery, whether it's the baker who feeds the pirates or the mechanic who fixes the boats. Are they just trying to make an honest living, or are they actively abetting crime?

It is sad because other ordinary people - the sailors - are being made to suffer.

I suspect that it will take a powerful and autocratic nation (read: China) to stamp out piracy. The European nations, who once kept powerful navies and embraced privateers as a means of safeguarding seaborne trade, today look inclined to do neither. The US is occupied with (perhaps more accurately, it is occupying) Afghanistan and Iraq, and has no appetite for more military action at sea.

China has a huge interest in making sure the transport of its raw materials and finished goods is not interfered with. And of course some Chinese make a living as sailors. What better way for China to announce its coming of age than by rescuing the world from the pirate scourge?

South Korea and the US have both taken tentative steps with special forces rescue operations, but these are necessarily limited in scope and conducted as much for publicity at home as for deterrence at sea. Only when the pirates are actively hunted down and killed will the activity stop. If China wants it can park warships off the coast of Somalia and sink anything that leaves the ports with weapons, on presumption of piracy. After all, fishermen don't need guns, and it's unlikely the Somalis are going to work abroad the ships as bodyguards...

Dead men tell no tales, and there are no repeat offenders either. At present China is about the only naval power that can do this without incurring the wrath of human rights activists at home. And of course China can ignore any criticism that may arise at the UN. So I personally think it will be the Chinese who will solve the piracy problem.
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#4
I don't see any interest for China to get involved in clearing out the pirates in this area. A lot depends whether the pirates are threatening their seaborne trade. China imports a vast amount of raw material, but a lot of the Gulf oil bound for China currently exits via the Arabian Gulf - so no conflict, yet. However the day would come when the pirates hijack a Chinese flagged vessel, and causes a few dead sailors. That might prompt China to act. We can hope that when that moment arrives, they decisive about it.
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#5
A little bit dated but great article on the workings of a pirate crew, together with a little on shipping in the Malaccan Straits. Most pirate crews and what other-worldly economies are usually the stuff of bad economic policies. Most of these pirates wouldn't do it if not for the money. I remember another article on Indonesian pirates where it said that most of these so-called pirates are actually bar men, waiters, shoeshine boys who take one job in hope of the huge payoff that lifts them out of poverty.

Dangerous Straits (National Geographic Magazine)
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#6
The earliest "legendary" pirate i learnt about was Francis Drake. Queen Elizabeth made him a "Sir" for pillaging Spanish gold galleons. And much of the Spanish gold came from their investment in Columbus and Co's expeditions to rob from the Incas and Mayans. All those were "legitimate" businesses with fantastic ROIs then Cool
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#7
Wow.. I think I actually learnt some very interesting stuffs on piracy on this thread.
This forum is darn interesting. LOL Big Grin

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#8
*stun*
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#9
China have, for the longest longest time, held a 'non interference' stance on such issues.
The pirates are not communists and they are neither friend nor foe.

There is a real danger here if the operations are not stamped out.
Imagine if they acquire capabilities to hijack planes, build Nukes/missiles....hold an entire country for ransome.

Also, I am beginning to see some similarities between this and the 'gaming operations' we have in singapore

The pirates = Gaming operator
Portion of revenue collected from successful operation goes to public works
Provide jobs for locals
Investors win(for now)
Key activity, 'robbing' people






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#10
(09-02-2011, 01:17 AM)Big Toe Wrote: China have, for the longest longest time, held a 'non interference' stance on such issues.
The pirates are not communists and they are neither friend nor foe.

There is a real danger here if the operations are not stamped out.
Imagine if they acquire capabilities to hijack planes, build Nukes/missiles....hold an entire country for ransome.

Also, I am beginning to see some similarities between this and the 'gaming operations' we have in singapore

The pirates = Gaming operator
Portion of revenue collected from successful operation goes to public works
Provide jobs for locals
Investors win(for now)
Key activity, 'robbing' people

Most creative comparison so far.......
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