"In 2007, Mexican authorities raided the home of Zhenli Ye Gon, a Chinese-Mexican businessman who is believed to have supplied meth-precursor chemicals to the cartel, and discovered $206 million, the largest cash seizure in history. And that was the money Zhenli held onto — he was an inveterate gambler, who once blew so much cash in Las Vegas that one of the casinos presented him, in consolation, with a Rolls-Royce."

Patrick Radden Keefe

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"The surest way to stay out of trouble in the drug business is to dole out bribes, and promiscuously. Drug cartels don’t pay corporate taxes, but a colossus like Sinaloa makes regular payments to the federal, state and municipal authorities that may well rival the effective tax rate in Mexico."

Patrick Radden Keefe

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"There’s a reason coke and heroin cost so much more on the street than at the farm gate: you’re not paying for the drugs; you’re compensating everyone along the distribution chain for the risks they assumed in getting them to you. Smugglers often negotiate, in actuarial detail, about who will be held liable in the event of lost inventory. After a bust, arrested traffickers have been known to demand a receipt from authorities, so that they can prove the loss was not because of their own negligence (which would mean they might have to pay for it) or their own thievery (which would mean they might have to die)."

Patrick Radden Keefe

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"Moving cocaine is a capital-intensive business, but the cartel subsidizes these investments with a ready source of easy income: marijuana. Cannabis is often described as the “cash crop” of Mexican cartels because it grows abundantly in the Sierras and requires no processing."

Patrick Radden Keefe

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"Drug cartel,” it turns out, is a whopper of a misnomer; neither the Mexicans nor the Colombians ever colluded to fix prices or supply. “I wish they were cartels,” Arturo Sarukhán, Mexico’s ambassador in Washington, told me. “If they were, they wouldn’t be fighting and driving up the violence."

Patrick Radden Keefe

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"With the decline of the Caribbean route, the Colombians started paying Mexican smugglers not in cash but in cocaine. More than any other factor, it was this transition that realigned the power dynamics along the narcotics supply chain in the Americas, because it allowed the Mexicans to stop serving as logistical middlemen and invest in their own drugs instead."

Patrick Radden Keefe

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"The Sinaloa cartel can buy a kilo of cocaine in the highlands of Colombia or Peru for around $2,000, then watch it accrue value as it makes its way to market. In Mexico, that kilo fetches more than $10,000. Jump the border to the United States, and it could sell wholesale for $30,000. Break it down into grams to distribute retail, and that same kilo sells for upward of $100,000."

Patrick Radden Keefe

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