A report by the OECD in Bridges Disgest states that aid to the developing world has fallen short.
Read it here
I think a case for developed world subsidies and then, dumping in developing markets is not a totally bad idea.
In fact, I hope as a bi-product of all of the protectionist actions from and within the devloped world that developed countries, start producing goods cheaper and then, it would end up in a profound glut and then they would end up having to dump cheap/subsidized goods in the developing countries--while their tax payers pay for it.
That can be seen as aid as well. In fact, it probably would be better than giving all out cash to developing country governments, in a time of all around financial pressure.
Wednesday, February 25, 2009
CLICO Bahamas in liquidation!
Well, more on this story as the week progresses. But, preliminary reports have it that CLICO in the Bahamas, is under liquidation.
From Trinidad to now the CLICO in the Bahamas.
Sad!
From Trinidad to now the CLICO in the Bahamas.
Sad!
Tuesday, February 24, 2009
Mr. Sentance should be sentenced!
I see why folks in the UK fear the worst for the economy!! In this recent speech on behalf of the BOE by ANDREW SENTANCE/
MEMBER OF THE MONETARY POLICY COMMITTEE
BANK OF ENGLAND, is more vague than anything I could have ever imagined.
Knowing how astute Brit's are with the English language, they too can pick up on this truck load of horse radish when they hear/see it. If the logic is inconsistent, then, most likely someone will point it out--perhaps with more celerity than I would or ever could. Such lyrical legerdemain would be exposed in a heartbeat and Mr. Sentance would become bete-noire because of such dodgyness in two heartbeats!
In any event, Mr. Sentance is projecting an uptick in Business Confidence to come about in the next month or so, which will signal the end of the worst part of this recession. He is basing his projections on previous recessionary data and assumptions on those recessionary periods.
However, if this recession and the root cause of it is still yet determined and, considering if whether or not the extra-ordinary measures put in place to secure the economy were more than merely conventional; i.e, re-capitalizing banks and; untangling the confusing web of financial derivatives/swaps, which led to this toxic soup of bad assets, which also need to be stricken off of the books of banks to assist them with having the confidence to lend to other institutions without fear of exposure to more toxic debt liabilities, then, how can he suggest that based on previous performances that he expects the same time frame for business confidence to pick up and show more favourable responses to questionnaire's?
Seems as if Mr. Sentance is using an old play book, for a totally different ball game!
In any event, this speech, honestly, was more of a book report, rather than a policy prescription or economic ukase. He would have gotten a C+ from me--based on his historically accurate account of what has already happened, but no more than that because he based his projections of things to come on a faulty and incomplete premise, as one example mentioned above shows.
In addition, this issue with monetary policy, controlling prices, is a little overstated as well as under examined analytically.
As Mr. Sentance puts it: "Despite the current recession, I still believe that the operation of monetary policy under the current framework of inflation targets has helped greatly to stabilise the UK economy compared with the inflationary boom-bust period of the 1970s, 1980s and early 1990s. Monetary policy can – over a suitable period of time – maintain price stability broadly defined." (pg. 19)
I think I mentioned the problems I have with Central Banks, trying to convey the feeling that they can control the price of goods and services, through monetary policy--or, as aforementioned in Mr. Sentance's speech, Quantitative Easing (QE).
A Central Bank, cannot control prices, through monetary policy--the contraction or expansion of money supply through interest rates-- if the price of the goods/services are over-valued, through the market pricing mechanism.
Secondly, access to money, will not spur my demand to buy a good/service, I do not want--we have raised people out of abject and pervasive poverty and, access to basic amenities, have become common; i.e, cellular phones; computers and; affordable, personal, transportation.
Thirdly, particularly for investors, if a good is under-valued at market levels due to the lack of information on the exact pricing of that good/service, nothing increasing money supply through the interest rate can do about that--in fact, you would increase inflation in other goods or services.
Misguided inflation? Sounds like a good enough term for it.
For example, if you wish to spur activity in the housing sector, but, if homes are under valued or people have simply just had enough of home buying, or, it is a losers market for buying the second home (lack of possible renters and you risk paying for two homes, in the long run, rather than the one you can only live in at this present point and time)--then, lowering interest rates, would cause a reaction in another sector--let's say the automobile sector-- where the level of prices in automobiles are more than market sufficient.
This is not a policy prescription for dealing with a matter such as price stabilization. In fact, it is ad-hoc and dangerous and, with more regression analysis on specifics of price targets in regards to inflation targets to that of spot prices in the market for goods and business buoyancy measures (CPI and Corporate Debt Issuance in particular), it can perhaps be shown that it [cutting interest rates] acted in the in the opposite (or a misguided) fashion, more often than not. Perhaps, it would also show that it was never effective at all as a price stabilizer/manipulator, either.
I can see why people like Paul Krugman et al, label QE as in-effective, especially in relation to this "liquidity trap"...which is, of course, another story to it self, but its tenets bear repeating here for the sake of the argument and its close resemblance.
Why is it that Mr. Sentance and the BOE, are going to continue this line of logic on QE along with monetary policy in regards to price stabilization through inflation control, when they are totally separate and completely unhinged ideals?
Why give the impression that you can solve a problem, you know full well you can't solve, never solve and have no intention of solving, for the better good moving forward? Unless the government actors want, truly, a big government controlled state, this would not be economically efficient for all parties involved.
I guess it must be true that governments are moving towards COMMUNISM--not socialism-- in a greater more hastened stride.
Go figure!?
MEMBER OF THE MONETARY POLICY COMMITTEE
BANK OF ENGLAND, is more vague than anything I could have ever imagined.
Knowing how astute Brit's are with the English language, they too can pick up on this truck load of horse radish when they hear/see it. If the logic is inconsistent, then, most likely someone will point it out--perhaps with more celerity than I would or ever could. Such lyrical legerdemain would be exposed in a heartbeat and Mr. Sentance would become bete-noire because of such dodgyness in two heartbeats!
In any event, Mr. Sentance is projecting an uptick in Business Confidence to come about in the next month or so, which will signal the end of the worst part of this recession. He is basing his projections on previous recessionary data and assumptions on those recessionary periods.
However, if this recession and the root cause of it is still yet determined and, considering if whether or not the extra-ordinary measures put in place to secure the economy were more than merely conventional; i.e, re-capitalizing banks and; untangling the confusing web of financial derivatives/swaps, which led to this toxic soup of bad assets, which also need to be stricken off of the books of banks to assist them with having the confidence to lend to other institutions without fear of exposure to more toxic debt liabilities, then, how can he suggest that based on previous performances that he expects the same time frame for business confidence to pick up and show more favourable responses to questionnaire's?
Seems as if Mr. Sentance is using an old play book, for a totally different ball game!
In any event, this speech, honestly, was more of a book report, rather than a policy prescription or economic ukase. He would have gotten a C+ from me--based on his historically accurate account of what has already happened, but no more than that because he based his projections of things to come on a faulty and incomplete premise, as one example mentioned above shows.
In addition, this issue with monetary policy, controlling prices, is a little overstated as well as under examined analytically.
As Mr. Sentance puts it: "Despite the current recession, I still believe that the operation of monetary policy under the current framework of inflation targets has helped greatly to stabilise the UK economy compared with the inflationary boom-bust period of the 1970s, 1980s and early 1990s. Monetary policy can – over a suitable period of time – maintain price stability broadly defined." (pg. 19)
I think I mentioned the problems I have with Central Banks, trying to convey the feeling that they can control the price of goods and services, through monetary policy--or, as aforementioned in Mr. Sentance's speech, Quantitative Easing (QE).
A Central Bank, cannot control prices, through monetary policy--the contraction or expansion of money supply through interest rates-- if the price of the goods/services are over-valued, through the market pricing mechanism.
Secondly, access to money, will not spur my demand to buy a good/service, I do not want--we have raised people out of abject and pervasive poverty and, access to basic amenities, have become common; i.e, cellular phones; computers and; affordable, personal, transportation.
Thirdly, particularly for investors, if a good is under-valued at market levels due to the lack of information on the exact pricing of that good/service, nothing increasing money supply through the interest rate can do about that--in fact, you would increase inflation in other goods or services.
Misguided inflation? Sounds like a good enough term for it.
For example, if you wish to spur activity in the housing sector, but, if homes are under valued or people have simply just had enough of home buying, or, it is a losers market for buying the second home (lack of possible renters and you risk paying for two homes, in the long run, rather than the one you can only live in at this present point and time)--then, lowering interest rates, would cause a reaction in another sector--let's say the automobile sector-- where the level of prices in automobiles are more than market sufficient.
This is not a policy prescription for dealing with a matter such as price stabilization. In fact, it is ad-hoc and dangerous and, with more regression analysis on specifics of price targets in regards to inflation targets to that of spot prices in the market for goods and business buoyancy measures (CPI and Corporate Debt Issuance in particular), it can perhaps be shown that it [cutting interest rates] acted in the in the opposite (or a misguided) fashion, more often than not. Perhaps, it would also show that it was never effective at all as a price stabilizer/manipulator, either.
I can see why people like Paul Krugman et al, label QE as in-effective, especially in relation to this "liquidity trap"...which is, of course, another story to it self, but its tenets bear repeating here for the sake of the argument and its close resemblance.
Why is it that Mr. Sentance and the BOE, are going to continue this line of logic on QE along with monetary policy in regards to price stabilization through inflation control, when they are totally separate and completely unhinged ideals?
Why give the impression that you can solve a problem, you know full well you can't solve, never solve and have no intention of solving, for the better good moving forward? Unless the government actors want, truly, a big government controlled state, this would not be economically efficient for all parties involved.
I guess it must be true that governments are moving towards COMMUNISM--not socialism-- in a greater more hastened stride.
Go figure!?
Monday, February 23, 2009
Stalling!
The G-20 leaders are stalling with any new regulation for finance. It's taking too long to come to obvious realizations on what needs to be done; derivatives regulation that de-couples that from the true price of goods; carry trades need to be curtailed; credit default swaps and in addition third party swaps.
They have already put the clamp on short selling. This needs to be kept in place.
But, the powers that be are stalling. Europe is stalling. It will take Obama to take them by the ear and slap them around.
Pres. Obama may have to get dirty. This is no time to play.
They have already put the clamp on short selling. This needs to be kept in place.
But, the powers that be are stalling. Europe is stalling. It will take Obama to take them by the ear and slap them around.
Pres. Obama may have to get dirty. This is no time to play.
Cutting the budget deficit?
What!?!?
The pressures of the office have gotten to the ol'e boy
Pres. Obama must be off of his med's. Apparently, Pres. Obama is looking to cut the federal deficit from $1.3 TR to about $530 BN.
LOL....pray tell, how does one do this, when you have tax cuts for the stimulus, an ailing US economy which does not know where it's next meal is coming from and, a stimulus package (with talks of more stimulus in the air), in the next two or three years?
This has to be political rhetoric, with nothing substantial behind it. I guess this is supposed to quell the conservative budget deficit hawks, after he gave them a porky stimulus bill.
The pressures of the office have gotten to the ol'e boy
Pres. Obama must be off of his med's. Apparently, Pres. Obama is looking to cut the federal deficit from $1.3 TR to about $530 BN.
LOL....pray tell, how does one do this, when you have tax cuts for the stimulus, an ailing US economy which does not know where it's next meal is coming from and, a stimulus package (with talks of more stimulus in the air), in the next two or three years?
This has to be political rhetoric, with nothing substantial behind it. I guess this is supposed to quell the conservative budget deficit hawks, after he gave them a porky stimulus bill.
Sunday, February 22, 2009
Back at Santelli...
I put op a video of the rant by Rick Santelli of CNBC a few days back. I promised a response by the end of that day. But, I do work from time to time.
But, here is my answer to his very shallow demagogy, for lack of a better term, against the Obama housing plan.
Basically, Santelli does not understand "why" the government would want to bail out folks, who can't afford their mortgages. Basic right-winged theory.
However, what he does not realize is is that these people, are losing their homes and taking down their neighbours with them, in regards to their neighbours, losing equity from dilapidated towns and cities after folks are moving out in droves. They [people who can pay for their homes] are losing value on their homes, unnecessarily.
Secondly, MANY of these people, could have afforded the homes, but, have either lost considerable household income, by any means, during this economic slowdown. They can't afford to lose their homes now on top of no prospect of subsidizing their household incomes.
When that happens, as it is happening now, it takes down the entire American financial system--as he has seen it. At least we hope so!
But, more importantly, most of these people are at risk of other social ills, which will manifest itself into degradation of the entire social fabric. Many are either minorities, or, folks who were generational lower middle class American families, who are a stones throw away from anti-social behavior. Helping them, is the humane thing to do.
So, Santelli, as much as I loved the theatrics of the rant, is not thinking about the body economy.
But, here is my answer to his very shallow demagogy, for lack of a better term, against the Obama housing plan.
Basically, Santelli does not understand "why" the government would want to bail out folks, who can't afford their mortgages. Basic right-winged theory.
However, what he does not realize is is that these people, are losing their homes and taking down their neighbours with them, in regards to their neighbours, losing equity from dilapidated towns and cities after folks are moving out in droves. They [people who can pay for their homes] are losing value on their homes, unnecessarily.
Secondly, MANY of these people, could have afforded the homes, but, have either lost considerable household income, by any means, during this economic slowdown. They can't afford to lose their homes now on top of no prospect of subsidizing their household incomes.
When that happens, as it is happening now, it takes down the entire American financial system--as he has seen it. At least we hope so!
But, more importantly, most of these people are at risk of other social ills, which will manifest itself into degradation of the entire social fabric. Many are either minorities, or, folks who were generational lower middle class American families, who are a stones throw away from anti-social behavior. Helping them, is the humane thing to do.
So, Santelli, as much as I loved the theatrics of the rant, is not thinking about the body economy.
Friday, February 20, 2009
Livni out, Netanyahu in...
What a difference a day makes in Israel!?!?!
Netanyahu forms coalition
I should have guessed this, but really thought that the country, was moving past their nationalist sentiments, to not go with Netanyahu, for the mere sake of having a parliament seat.
Tzipi Livni, the leader of the Kadima party in Israel, who won by one seat (28-27) over her nearest rival, the Likud Party led by former PM Benjamin Netanyahu, has just been side-barred by a coalition of Likud and two other sub-parties.
The parliament in the coalition, said they preferred to back Netanyahu. Surprising that it happened, but not surprising that the coalition sub-parties, chose the side they can extract they best benefits from.
There was no point in joining Kadima, because Kadima had the numbers by party. So, it made sense, to form a coalition, where one, or, maybe two of your MP's, would get a chance to get into the Netanyahu parliament if they struck a deal.
How long will it last, is beyond me. However, Ms. Livni cannot be too pleased,. having power stolen from her by some weak kneed coalition, fractured, with a blood lust nationalist like Netanyahu at the helm.
All he needs [Netanyahu] is a major accident and he can unite Israel under his leadership.
I don't smell anything good of this. Truly!
Israeli's will regret this day!
Netanyahu forms coalition
I should have guessed this, but really thought that the country, was moving past their nationalist sentiments, to not go with Netanyahu, for the mere sake of having a parliament seat.
Tzipi Livni, the leader of the Kadima party in Israel, who won by one seat (28-27) over her nearest rival, the Likud Party led by former PM Benjamin Netanyahu, has just been side-barred by a coalition of Likud and two other sub-parties.
The parliament in the coalition, said they preferred to back Netanyahu. Surprising that it happened, but not surprising that the coalition sub-parties, chose the side they can extract they best benefits from.
There was no point in joining Kadima, because Kadima had the numbers by party. So, it made sense, to form a coalition, where one, or, maybe two of your MP's, would get a chance to get into the Netanyahu parliament if they struck a deal.
How long will it last, is beyond me. However, Ms. Livni cannot be too pleased,. having power stolen from her by some weak kneed coalition, fractured, with a blood lust nationalist like Netanyahu at the helm.
All he needs [Netanyahu] is a major accident and he can unite Israel under his leadership.
I don't smell anything good of this. Truly!
Israeli's will regret this day!
Subscribe to:
Posts (Atom)
