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.

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.

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.

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:

http://en.wikipedia.org/wiki/File:GDP_PPP_per_capita_2007_IMF.png

This file is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported, 2.5 Generic, 2.0 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.

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

Explaining:

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

HOPE

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!

Why some companies go under and others remain above the water, floating away of the problems!? 

Is it just a matter of perspective, like in the story, "is the glass half full or half empty"!? 

The following items and techniques are missing in most business across the world, condemning them to failure. Many times, analyses focused in competitive advantages, tackle the lack of competitiveness, trying to solve it by lowering the wages or devaluing the currency. Therefore, they try to fake the real problem, by lowering the weights in the balance, and usually in the long run don't solve anything. In order to solve most problems concerning competitiveness, every company and business must incorporate the following into their "DNA - Dynamic Nature and Approach", every day, and into every thing they do:

Capital - The availability of working capital (wc), capital expenditure (capex) and business venture capital to promote the existing and the new start-up's

Management and Organizational Techniques - inducing reliable and verifiable management techniques

Collaboration, both within business/company and abroad

Innovation, built into products, services and management

Sustainability - Manage it and Do all this in a Sustainable way

Competitiveness is enhanced when all of this is set and done. Depending on the roadway that you want to follow, of course, we must have the right incentives that will include:

** Government with the right economic approach towards business;

** Fiscal stability and lower taxes;

** Justice working quickly and in a transparent way;

** State of the art Communications;

** Working Infrastructure concerning housing, warehousing, industry's, factory's, office's, basic services, operational and "well-oiled" port's and airport's , etc...;

** Safety;

** Access to Resources: The need for qualified workers, aditional funding, machinery, materials and the services needed to implement and operate the business that we want;

and others ....

Up with the new (old) economic truth ... The old teachings are alive again!

Down with the old economic truth ...welcome to the new (old) economic basics ... time to look at Production (real production) and to competitiveness, take a look at people and work hard, promote the ability to coordinate efforts, to plan ahead, to innovate, to induce collaboration and value the ones who create the conditions to grow in a sustainable way, giving the new motivation a chance to be contagious and finally to achieve results ... we might be surprised about what we will find and with what we can do.

The Ratings are reflecting it the wrong way. Why?... when they can make it work, measuring it the other way...

When a country accumulates sovereign debt in excess, going over their capacity to repay what they are borrowing, again and again, Rating Agencies say - "this is triple AAA" !!!??? This example and the followings occurred during the past decade, but they haven't learned and it happened during the past 2 years after the pick of the financial crises, and also, it can be seen even in the past 2 months.

When a country accumulates high budget deficits in the last decade, and keeps on doing it every month, and these conditions occur at the same time with an average real growth rate around 1% or less, Rating Agencies say - "this is triple AAA" !!!??? (several examples during 2002-2012)

When, a country recognizes a problem and starts doing something to become solvent, Rating Agencies say this is not Ba or BB, or at least Caa1 or CCC, no, they say "This should be considered as Ca or C (Garbage or Junk)" (!!!???)

When a country which has been downgraded by a Rating agency, start's to correct his budget and trade deficits, finally goes to the market and issue sovereign debt with lower borrowing costs, I say in some hard working cases, this is at least Ba3 or BB-, with a positive outlook. Rating agencies don't agree !?!?!? (many examples during the last year).

The current ratings concerning most countries and public debt are useless. Always arrive late, don't solve nothing, don't help countries to identify their real problems and usually are (the ratings) the source of more problems than the ones that they were supposed to solve.

Perhaps we should save the money that we are paying to rating agencies. It should be put into better use, helping to keep our own budgets under control. This way we will be able to cut expenses without condemning growth. ;)

They (rating agencies) have a chance to reform and transform the work that they have done over the last years, and start doing it in the right way, as it should be!

I say, back to the "OLD...", nowadays, good looking and new...hard working analyses and the specifics about the real economy!" The old teachings are alive again...

That's why:

Down with the old economic truth ...welcome to the new (old) economic basics ... time to look at Production (real production) and to competitiveness, take a look at people and work hard, promote the ability to coordinate efforts, to plan ahead, to innovate, to induce collaboration and value the ones who create the conditions to grow in a sustainable way, giving the new motivation a chance to be contagious and finally to achieve results ... we might be surprised about what we will find and with what we can do.

Photograph by Vincent J. Musi, National Geographic (Herding Family, Turkey)

Growth, how do we create the conditions in an unbalanced economy...

GDP-FOR-EU

(Growth Driven Projects for the EU)

Want to promote growth, without stopping the necessary Fiscal and Budget consolidation?

Restructuring the European economy, takes time and effort, work and sacrifices. Financial Markets work on anticipation, without effort. The difference between these two time-lines, don't favor a good job.

"Uma Europa de Nações", Europe of Nations or "L'Europe des patries" (by General de Gaulle, in 1962)? yes!!!

Everyone should really play their part...and they are not doing it... 

The European Parliament (the center of EU democracy) should be able to also act and serve as the Board of Control/Verification for all national Budgets, including the EU Budget  A fully independent EU Board of Budgeting and control, can be achieved through the European Parliament. Would they dare to make it happen? 

The European Commission should be the center of the EU policy, moving the Union forward, on behalf of the European Nations. 

A Central Bank (the ECB in this case) should support the economy and the restructuring plans, and not "others", have been so over the last 150 years in each central bank across the world, only and during the restructuring, if, the country is working accordingly with the plan. 

The ECB should then intervene in the markets, as long as a country comply's with the restructuring plan, helping it to achieve success. 

If a country is complying with an economy vs sovereign debt restructuring plan, he shouldn't be under the financial markets influence, because the uncertainty of the markets, mostly driven by the search for fast profits, works against the time that is needed to re-structure a countries economy. 

One cannot be entirely healthy if the leg is hurt. A Union (EU) cannot be complete if only some countries can benefit from it. In my view a country only makes sense if it is made for the people, in peace, as a whole. The same is valid for the European Union. 

(the Following, was posted Jan, 21st, 2012) @ my G+

Why European Union needs a new treaty? Why shouldn't we get an amendment, specifically for financial management, budgeting, control and penalties. An amendment that would be enforced and supervised by the EU Parliament, and not by any other state or group of states. Without a positive framework in the economy, what we will get in this stage, trying to negotiate a new treaty, are bad requests and impossible conditions to be met. 

Europe has the ability to finance its debt with his own resources, why should we depend upon others to define our own future? 

Fiscal and Budget consolidation is needed fast, because it brings sustainability, and if it is sustainable (the economy), then, with solid basis, it can develop it self. Alongside with it Europe should promote growth, but now is concentrating too much on austerity (cost reduction), which is destroying the EU project. I was hopping that they had learned something by now...!!! EU should be concentrated on strengthening Europe's major growth keys, Engineering, Communications, networks (Ports, Airports, Railways, Data..), management skills, Product development (Innovation), Knowledge network : schools<=>companies =>project=>reality, in order to achieve competitiveness advantages and efficiency gains, allowing a fully restored European Social Development. 

(The Following was posted Jan, 31st, 2012) @ my G+

Good economy can work for the people, by the people and it is made of people.

Bad economy, doesn't like People
.

Does the EU needs more "insightful" information ... they need to change course.

- Restructuring without condemning "the good growth". We must preserve what has been done right;

- Re-invent the Country, but do not kill the industry;

- If the industry innovates, we must help them to continue to thrive and create even more;

- If companies are exporting, then, we should support them to export, produce and create more jobs.

Any manager knows something like this.

Why EU leaders tend to forget that a Union is a sum of Nations, that had been them selves created by the sum of regions ... created by the sum of cities, created by the sum of industries and communities ... "of the people, by the people, for the people". 

In an economy that is opened to the world and currently unbalanced, more specifically concerning budget, savings, trade and debt, all resources that are fueled into the economy, will flow away, unless,... conditions are to be met in order to sustain and multiply locally the benefits and the effects of a specific project. In order to achieve this, the industry and the universities must be included in all projects, preferably crossing high Value Added oriented industries with local business/industries, spreading the effects throughout the economy,  in sectors like energy, engineering, research centers, science, education - knowledge and innovation, third-age-care and support, new age schools and support for the youngest, improving communications throughout Europe, etc ... 

For more info concerning Induced and Reversed Sustainability, please take a look at the following file,

Research Paper: About the reversed sustainability effect:

▼

Concerning Induced and Reversed Sustainability (March, 27, 2012)

MPRES and/or BPRES

Project oriented Eurobonds, would and should be supported by the projects infrastructures, knowledge and good management, backed by the ECB certification program, and promoted by the EU.

Unemployment is another problem that Europe is facing alongside with the recent nationalism's that have been fueled by the austerity programs in many countries. 

Because of this and to support all growth-driven projects across the European Union (EU), we need to support and issue MPRES - Multi-lateral Project Related Euro-bonds, to end the shortage of financing in the economy for key growth driven projects across the EU.

Multi-lateral (several nations) and Bi-lateral (two nations) Project Related Eurobonds (M & BPRES) managed by the ECB, indexed directly and secured by the project it self, would be extremely helpful for the economy. They would finance the conversion of the following EU industries and networks: Energy, Transports, Communication, Environment, Research and Development, "New era" Schools for the youngest, among other key and vital industries..., creating jobs and allowing the entire EU to export goods, services and the knowledge acquired and developed in these economic oriented projects and industries, addressing one of Europe's main problems => Growth 

This would mean something to all Europeans, managing Europe as a Union of Nations, with a common project, freely related with each other, with mutual interests. The way we live our lives and respect each other, that's what makes us unique (European Union).

Dispersões: Camilo Lourenço apresenta novo livro na Bulhosa (C...

A maior parte das pessoa que conheço, desconheçe a nossa história, como um povo e como uma nação, desconhecendo portanto os motivos que nos levaram a chegar até aqui. Como tal, nunca vão poder elaborar / construir uma solução adequada para os problemas que estamos a enfrentar. Pela coragem que teve em defender as soluções que sempre apresentou e pelo livro que acaba de lançar, vale a pena pensar um pouco e analisar as mesmas ...

Dispersões: Camilo Lourenço apresenta novo livro na Bulhosa (C...: Título: Basta! Autor: Camilo Lourenço Editora: Matéria-Prima edições Páginas: 232 PVP: 16 euros Apresentado pelo ex-ministro...

One picture, a feeling, a thousand thoughts...

One Picture that i like ... this photo was shot at "Serra da Estrela, Portugal, in 2006", and was taken with the intent of presenting the feeling of a journey into the unknown ... With a sense of Peace, Serenity, nice colors, and a direction that is clearly defined, even not knowing where we will end up to, exactly ... We are left with an option: Because we can see the road, not all the way, but only the direction that it is taking in the mid horizon, we can choose ... if we want to take that road or not ... like in life ... !!!

Tranquility, Serenety, a sense of Peace, an afternoon well spent ... all good things that i can take out of this image. I hope you can get them too... Have a good Journey ... ;)