Monday, April 15, 2013

On one hand ... Monetary Policy vs Finance vs Economy

The Real Economy, receives only a marginal piece of the pie, around 10% of it, only and mainly due to Bank Shareholders and Employments related with the Stock Market and their operations, with their extremely leveraged profits and wages. It will happened somewhere along the line, where and when they will end up buying or investing a fraction of their gains, eventually, in something remotely connected with the Real Economy.

Tuesday, March 26, 2013

Sabedoria popular ... não há que enganar!

Ditados Populares e a História recente de Portugal

25 de abril de 1974

A união faz a força
Água mole em pedra dura, tanto bate até que fura
A verdade fala pela boca dos pequenos

25 de Abril de 1976 - Quem se mete em atalhos, mete-se em trabalhos.
FMI em portugal em 1977

02 de Dezembro de 1979 - Quem entra na chuva é para se molhar.

05 de Outubro de 1980 - Cesteiro que faz um cesto faz um cento.
2.ª Eleição de Francisco Sá Carneiro

25 de Abril de 1983 - Vão-se os aneis e ficam-se os dedos.
2.ª vez FMI em portugal

12 de Junho de 1985 - O dinheiro fala todas as línguas.
assinatura do tratado de adesão á cee

06 de Outubro de 1985 - Quem procura acha.

09 de Julho de 1987 - Quem sai aos seus não degenera. Cada um é como cada qual, e cada qual é como é.

06 de Oubtubro de 1991 - O trabalho dá saúde. Guardar hoje para ter amanhã.

01 de Outubro de 1995 - Em Agosto toda a fruta tem gosto. O sol nasce para todos.

10 de Outubro de 1999 - Por fora bela viola, por dentro pão bolorento.

17 de Dezembro de 2001 - Quem não pode arreia. Baleias no canal, terás temporal.
"renúncia de António Guterres"

01 de Janeiro de 2002 - A pobre não prometas e a rico não devas.
Euro em Portugal

17 de Março de 2002 - Não deixes para amanhã o que podes fazer hoje. Avô rico, filho nobre, neto pobre.
"estavamos de tanga"

25 de Junho de 2004 - Há mais marés do que marinheiros.
"anúncio da saída de Durão Barroso"

17 de Julho de 2004 - Quem espera sempre alcança.
"nomeação de Pedro Santana Lopes"

20 de Fevereiro de 2005 - Com papas e bolos se enganam os tolos. Comer e coçar é só começar.

Crise (2007-2008) - Casa roubada trancas á porta
Crise imobiliária nos EUA e crise financeira mundial

27 de Setembro de 2009 - Cacarejar e não botar ovos. Nem todas as verdades se dizem.

05 de Junho de 2011 - Não há parto sem dor. No aperto e no perigo se conheçe o amigo.

Hoje, 26 de Março de 2013 - Perde-se o velho por não poder e o novo por não saber.

27 de Março de 2013 - Quem não apareçe, esqueçe, mas quem muito apareçe, tanto lembra que até aborreçe.

28 de Março de 2013 - Quem anda de boca aberta ou entra mosca ou sai asneira...

Se tivesse uma varinha mágica e com ela a possibilidade real de mudar alguma coisa através de um simples toque, depois de eliminar a Doença e a Fome, seguir-se ia acabar com a Ignorância.

The Written Word. Knowing it ...

Impressive ... Knowing it, is one thing, but seeing it in the "Written word", is much more powerful!

1st Trade; 2nd Country; 3rd Money
4th Budget; 5th Markets; 6th Debt
7th Savings; 8th Deficit

The Graph Link

Now, have you ever wonder How and Where does the world sets his priorities set!?

The ones who rule our current destinies (governments) in the old days, they picked their insights mostly from books. So, we will understand them better if we concentrate and focus on what were their "written priorities", where they acquired their knowledge and Philosophy. Knowing about their mindset, will enable us to retrieve enough information in order to read their priorities. We will perceive their work much faster, and we will be able to prevent or to avoid many of the wrong doings that are currently under way. We also need to keep a closer look, towards the understanding of the false information and incorrect content that currently is surfing the internet, because, it will be in the Internet, where the future Government's will read their information and where they will define their priorities.

This is why: good and verifiable sets of information, good management and a sustainable approach towards governance will promote a good government.

Saturday, March 16, 2013

The Man-i-fest, is an informed man! (About Myths)

Usually, myths are created by the ones who want to avoid doing something, because there is too much work involved, and they will not benefit from doing it, or because if they do it right, they will be affected negatively.

1st Myth - Arguing that more money will solve problems 
The 1st myth statement - "Rich Countries and specially Northern European Countries, they spend a higher percentage of their GDP to support their Central government spending, and because of that, they have higher standards of living".

The Facts
Countries like: Switzerland 16%, Japan 18%, Canada 19%, Korea 19%, Australia 26%, United States 25%, Germany 31% and Sweden 32%, they have captivated a smaller amount and/or medium percentages of their country's wealth, for their central government spending, and they remain at the top of all indicators, as the best in the world concerning good standards of living for their citizens

The Reality
Good management,  and Sustainable politics (approach to management) are the Keys
Money will help deploying the necessary resources.
Good management will solve the problems and Sustainable politics will help prevent the problems,
This will lead us to the next myth ...

2nd Myth - Poor countries pays less to their employees because they are poor
The 2nd Myth statement - "Poor governments (from poor countries) spend a smaller share of their spending with the Compensation of their employees because they don't have enough money to spend".

The Facts
Countries like: Ghana 35%, Croatia 25%, Turkey 25% and Portugal 22%, spend the highest amount of their expenses with compensations of employees. And Norway 16%, United Kingdom 13%, Denmark 12% and Germany 5%, spend much less but still they present a much better quality of service to their population.

The Reality
In fact the reality contradicts the Myth, because it is precisely the opposite situation. Most rich countries employ less population in their central governments ( in % of their population) allowing them to pay better, but keeping the spending with their employees in a lower % of the overall expense of the central government.
The Keys are Technology, Organization, and again, Good Management. The beneficiaries are the citizens of those countries, where good management and sustainable policies are applied. 

3rd Myth - "We are independent"
"Most countries argue that they should stop paying their bills and their debt, because they will survive on their own..."

The Facts
Within the 33 Nations of this analysis, 9 are net exporters of energy and the other 24 have to import energy.
If we look further, within a sample of 127 countries, 82 countries (78%) have to import energy.

The Reality
Energy is just one side of the issue or one example. Perhaps the example that most people think about. If you cannot live without something, you will need others (countries) to provide it for you.
In Reality a country has only two choices. They can manage their finance and their economy with sustainable politics and good management, or, they can try to delay that approach by continuing the printing of their own money, or if their central bank has already printed to much and cannot continue to do it anymore, they can continue to do the asking and borrowing even more money, even though they know that they will not pay it any more. Of course, latter on, they will have to inform their citizens, because somewhere along the line, they will have to change course, with more pain and taxes for their population, because in the world where we all live, there is no such thing as a country that is fully independent.
They (the countries and citizens) all need something that they don't have or that they will like to have. Because of that, they will have to negotiate and make deals that will lead to build the necessary trust (that, one will provide and the other will pay) between the two sides of the equation. If both sides balance it well, they all might and usually they get something good in return. Again, good management have to be there. If they don't do it well, someone will end up with the good stuff and the other will always end up with an enormous amount of debt, without having the ability to build anything, besides continuing the printing of money and the asking for more borrowing.

Tuesday, March 12, 2013

Real growth, as it is ...

...You wouldn't believe it unless you see it ... so ...

During the last 30 years ...

The world's growth didn't run like a cheetah! 

It was more like a Turtle ...

This was the situation in 2007. Until here and after taking a closer look at this image, you will not notice any substantial different piece of information, compared with what has been posted in the news / media, throughout the world, during the past decades ...

Image from the Wikipedia Website. It can be viewed here:
This file is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported2.5 Generic2.0 Generic and 1.0 Generic license.

...And, concerning the evolution of the GDP per capita, PPP, in the past 30 years ...

Looks nice !? No it shouldn't.
 If you look closer you will notice that this is a 30 years chart and that the average Growth,
 year end, Real GDP, per capita,
 was in most countries, lower than 1% per year.

This means that there was not enough wealth created in those countries during the past 30 years, to support growth rates on the side of expenditure, bigger than 1%. And in most cases, many countries grew their budget expenditure many times more than they should, creating one of the biggest problems that threatens democracy and stability, worldwide. That is why, if you don't have the ability to print or to borrow money indefinitely, as in most cases, you should concentrate all your efforts on good management.

Monday, March 4, 2013

This has to change ...

The red carnation ...

... this symbol of the Portuguese Revolution (April 25th, 1974) is not presented here to call for a revolution, but it is displayed to honor the People of a Nation - PORTUGAL


I am Portuguese ...
I was proud to born as such...
Now I am honored to belong to this nation!

Last Saturday, many of us (I wasn't one) went to the streets and they gave a "lesson" to the world.

They manifested their discontent, their grief and their pain, with honor, with a civilized attitude, respecting the others, but still ... they have stated their opinion.

The amazing Sound of Silence and the Dignity of the Act was expressed tremendously throughout the singing of one song.

For me, the Manifest meant the following:

"We love our country, please don't destroy it.
We know the country had to change course, but
15 years of bad management cannot be emended in 3 years (2011-2014)
with the current world economy and under the present conditions of the program.
It's not possible and it's not working.
This has to change."

It is not possible to emend 30 years of accumulated budget deficit, 15 years of trade deficits, change the productive platform in the industry, reduce substantially the weigh of the state in the economy, among other bad work that has been done by the governance of the Nation. It is not possible to solve all of this in just 3 years, under the present conditions and with the present world economy.

The Red Rose

a symbol of love, respect and courage

Saturday, March 2, 2013


Help On "Poor" Europe

Because the ECB, the IMF, the European commission and the European council refused to cooperate with the countries that are complying with the restructuring plans, helping them to achieve success, concerning:

1) Providing economic support. A country can not reform their state institutions and their policy, deleverage their financial institutions, change their growth matrix and at the same time, support the "new" economy and support the ones that will be damaged by the restructuring process.

2) Low interest rates for the European economy. The lower interest rates were only used and applied to help banks. The cheap money didn't arrived to the companies and organizations.

3) Create Economic support programs, to be available directly to the European companies. The institutions mentioned above, they worked to support the European banks, but failed completely on the support side of the economy.

Finance should support the economy and not the other way around.

Now, because they refused to act sooner, they created the perfect conditions to help the demagogue leaders and their policies.

Now, the Reversed Sustainability effect , is just waiting for the right moment to be "stimulated", and is more dangerous than ever.

In the middle of a restructuring plan that will balance the macro-economic variables, that will lead to a recession period, the following conditions have to be met:

a) Economic Support at a Macro-level: The direct economic support to companies / families and organizations has to be made in a Macro scale, by the European Union, led by the European parliament and the European commission, using Mutualism Mechanisms, development banks and mutual credit banks. They, the parliament and the commission are the real European institutions. They alone, are the ones who can defend Europe.
These actions need be funded by new European taxes applied to every "flash trades" and "short selling" operations as well as to all "money transfer" operations made to fiscal paradises, with effect on to and from every European financial markets. These operations aren't related with investment opportunities. They are in reality related with speculative operations, conducted mainly by computers, doing automatic "Stop-loss" and "Stop-gain" operations.

and balance with;

b) Reform at Micro-level, country by country: The restructuring of the state policies, the balancing of the budget, the reform of the institutions, the unbalance of the economic variables (deficit, trade, budget, and debt) and the change in the productive platform, they have to be reformed in a Micro level, country by country.

c) The government has to duly explain what they are doing. Use real life and current examples that are understood by the general population. Example, to explain the debt issue and the accumulated deficits throughout decades, use a family budget.

A Family or organization or country, can accumulate wealth and growth (apparently) using, an amount of debt that is unsupported in the long run. This can go on and on, only until the creditor/s allow and accept the possibility of a good debt return and a lower risk.

Because: The result of creating a bad economy, supported on a high consumption rate,of, mainly imported goods, unsustainable and repeated budget deficits, high trade deficits and a low savings rate, happening systematically year after year, is:

An Economy that is accumulating wealth that belongs to someone else (their creditors).

d) Continuing the monitoring and the adjustments that have to be made to every restructuring plan.

A restructuring budget/debt/trade plan, in any country, needs time and support from all institutions and parts involved in the plan.

This way it is possible to reduce the damages that will be made, minimizing the effects of the painful but necessary change, equalizing the production/productivity of an economy, with the benefits that are given to their citizens.

... together, as a Union of Nations!

Again and again, throughout Europe the same thing occurs every time ...
So, how about learning !?
Against the financial speculation ... States, Companies and Families have only one way...
Know what your are doing, do it in a sustainable way,
don't create debt beyond your ability to repay it,
or you will be putting yourself into the lion's mouth!