How does a bank that collapses on Monday leave the president under arrest by Friday?

Timothy Allen speaks with Raphaël Lima, who lives in Paraguay, about the collapse of Ueno Bank. Paraguay’s central bank shut the digital bank down in the early hours of Monday 2 November. By Friday evening, the Senate had removed President Santiago Peña from office and he was under arrest.

Raphaël takes Timothy through the week as it happened: the arrests at the bank, the resignation of the head of the central bank, the guarantee fund that began paying depositors within days, and the links to the bank that left Peña’s own party unwilling to defend him. He explains why most account holders lost very little, since many accounts held almost nothing, while Paraguay’s social security fund and other state bodies had large sums in the bank.

Timothy asks whether Paraguay’s drive to attract investors and new residents survives this. Raphaël, whose company Settee helps people move to Paraguay, says demand from Brazil has surged since Lula’s re-election. They discuss why Paraguay held powerful people to account so quickly when bankers elsewhere rarely face consequences, why Ueno was so popular, and how loans to companies linked to its owner left it badly short of capital. Raphaël also explains why Bitcoin is still hard to use day to day in Paraguay, and how a new crypto reporting rule has changed things.

The conversation then widens. Raphaël argues that voters, not politicians, decide how big the state gets, and that people rarely change their minds without pain. They discuss Javier Milei, Nayib Bukele, fusionism and why the right drifted away from free-market economics, and why Raphaël thinks small, like-minded countries are easier to govern. He ends by answering the question Brazilians keep asking him: should they still move to Paraguay?

In this conversation:

• What happened in the hours after the central bank closed Ueno Bank
• How the deposit guarantee fund paid people back so quickly
• Who actually lost money, and how much state money was in the bank
• How the scandal reached President Santiago Peña
• Why Congress refused his resignation and impeached him instead
• Whether Paraguay can still attract investors and new residents
• Why Paraguayans held their leaders to account when other countries rarely do
• Why Ueno was so popular, and what went wrong inside it
• Bitcoin, crypto and Paraguay’s new reporting rule
• Whether this points to a wider financial collapse
• Javier Milei, Nayib Bukele and why the right lost its way on economics
• Why Raphaël thinks small, like-minded countries are easier to govern
• Whether he would still tell Brazilians to move to Paraguay

Enjoy the conversation.

Timestamps:

• 0:00:59 - Start of conversation
• 0:01:58 - The night Ueno Bank was shut down
• 0:03:19 - Arrests and a central bank resignation
• 0:04:12 - The deposit guarantee fund steps in
• 0:05:25 - How the scandal reached the president
• 0:06:08 - Social security and state money in the bank
• 0:07:48 - Resignation refused, impeachment and arrest
• 0:09:51 - Who actually lost money
• 0:11:45 - Paraguay’s push for foreign investment
• 0:13:06 - Settee and the rush of Brazilians after Lula’s re-election
• 0:16:32 - Has the collapse hurt confidence in Paraguay?
• 0:18:56 - How locals and foreigners reacted
• 0:19:58 - Why people went to jail in Paraguay and not elsewhere
• 0:24:22 - Was Peña seen as corrupt before this?
• 0:27:08 - Why so many Paraguayans banked with Ueno
• 0:30:28 - What went wrong inside the bank
• 0:32:58 - What happens to Ueno now
• 0:34:09 - Bitcoin and crypto in Paraguay
• 0:36:47 - The new crypto reporting rule
• 0:38:03 - What comes next for the investigations
• 0:40:40 - Is this part of a wider banking problem?
• 0:44:09 - How Brazil’s left and right are using the story
• 0:48:29 - AmityAge: turning stranded gas into power in Alberta
• 0:49:42 - Has this changed Raphaël’s view on financial collapse?
• 0:52:50 - Why voters, not politicians, decide the size of the state
• 0:54:44 - Is the West swinging back to the left?
• 0:58:14 - Fusionism and how the right lost its way on economics
• 1:03:01 - Why nobody has an incentive to shrink government
• 1:07:02 - Why change needs pain: Lew Rockwell and Javier Milei
• 1:14:27 - Nayib Bukele: too good to be true?
• 1:22:57 - Why small, like-minded countries are easier to govern
• 1:27:44 - Paraguay, Free Private Cities and choosing where you live
• 1:28:30 - Would Raphaël still tell Brazilians to move to Paraguay?
• 1:30:49 - Where to find Raphaël and Settee

Guest: YouTube | X | Settee

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