Acerca de mim

A minha foto
Lisboa, Portugal
Nasci no dia 11 de Junho de 1964 na cidade da Beira, MOÇAMBIQUE.

A Estação dos CFM, Beira

A Estação dos CFM, Beira
Ex-libris da cidade, 1966

The Euro, as a single currency, should be abolished

Another black and white motion statement leaving me no option but to choose No.
While I agree to the first part I am not prepared to contemplate the idea that the Euro should get abolished.
Abolished? Then what?
All 17 countries now sharing the single currency would revert back to their old monies?
Or a new version of yesteryear's currencies?

Simplistic as I made it out to be packed in a few odd questions, every single serious economic, financial and social consequence is inextricably wrapped up within each.
That is where the stakes are high enough to ensure that the Euro is given a new lease on life.
It calls for closer European integration.
What form and shape this will take is for policymakers and far-sighted politicians to grasp and propose.

It would seem to me that the Euro has many underlying strengths but will not - contrary to the founder's beliefs - assure convergence between all the economies it services. How could it?
The divide has been felt acutely lately (1-2 years) the logical consequence of relevant economic under-performance among member-countries.

There has obviously got to be a political solution rooted in realistic economic fundamentals.
The road traveled so far proved artificially smooth during the first 10 years I dare say but unsurprisingly very bumpy in the last 1-2.
It could not have been otherwise given the structural differences setting these countries apart. And excessive spending pursued mostly by a few Southern European States who could not see beyond the present.
Adherence to the Maastricht criteria never again seemed to be taken seriously once countries landed themselves inside the Euro club. Not to mention Greece that never fulfilled the criteria in the first place or ever bothered to balance its books.

Very disappointing to admit but the Euro Zone is indeed right in the middle of a storm testing its main crews to the limit.
The latest summit decisions seem to indicate that where there is a will there is a way.
It may have just been one first small step in the right direction.

The specifics are very hard to work on.
Yet it would seem to me that the 17-member Euro Zone and the larger EU can hardly afford shooting down the Euro.
The broader picture needs to come into full view.
An hypothetical demise of the single currency would deal another severe blow to Europe's economic fortunes.
Its relative decline vis-a-vis the rest of the world would get a further boost.

I do not like misplaced calls for solidarity from Southerners but would rather see the stronger half of the dividing line realize where their medium-to-long interest lies.
To that end many balances across the Euro Zone need to be restored at the earliest.

Europe agrees a "shock and awe" bailout for Greece

A rescue package of epic proportions, epic challenges for the Greek government and people, epic uncertainties and epic stakes for the single-currency.

It was the Euro's defence that ultimately forced politicians from Germany to Malta to perform a hard balancing act whose overall success is far from assured.Each finance minister has enough reasons to fret and grumble about.It being the Euro as a common currency, because of Greece despite Greece.
Up to now every 'least damaging' approach failed miserably to cool down the financial markets that remained as unimpressed as ever throughout.
For its part Greece is effectively the main winner in this high-finance gamble.The country bought time the markets were not willing to give it once confidence vanished.Precious time desperately needed to restore credibility and good governance at home.
A daunting internal fix with daunting external implications.
Three full years is what the government and Greek society top-down and bottom-up now have to set the record straight in so many ways.
Literally and figuratively.

For the other 15 Eurozone countries - each facing own troubles to varying degrees - keeping fingers crossed would be mild to describe the monitoring of Greece's performance over the coming 36 months.Potentially they are all losers, starting out by losing simply to avoid bigger losses!
There are so many relevant questions that might be asked to which full answers ought to be provided.
They won't get asked or get answered.
Tellingly, each and every single one of them would now seem rhetorical or at best an exercise for academia.

The spectre that haunts Europe

I am still hopeful that Greece will not require a bail-out in whatever form pinning my hopes on the PM's own words.

He did sound very bold and brave in the face of such overwhelming odds but until a deal is actually in place I would rather believe the Greeks can and will take care of themselves.

My stance is wholly based not on immediate needs triggered by the Western financial meltdown that led to the economic downturn.This in turn led to a collapse in tax revenues across countries caused by economies shrinking badly.

To a large extent Greece is indeed a one-off case-study for the worst reasons, its latest fiscal deficit the sum total of profligate spending, widespread cultural-rooted tax evasion, underbudgeting, creative accounting, weak notion of public service and duty, etc - all conspiring over decades to bring the country to the brink of bankruptcy.

I am sure many Greeks will have seen it coming and warned their governments in years past.To no avail as even the present government was elected as recently as late 2009 on a platform to increase spending.

According to EMU rules public finances were clearly to remain national responsibilities.A considerable chunk of sovereignty for States to manage through their democratically-elected governments of the day.
Would the Greeks have liked their Finance Ministry to be ruled or dictated to from Brussels or Frankfurt just so the Maastricht-agreed criteria could not have been so despondently ignored?

Current turmoil is the Euro's hardest test ever but one that will also represent a defining moment in the single-currency's future.

It is a fact that Southern European countries are faced with similar issues though not on the same scale and urgency.Others in Northern Europe, the US and Japan also recorded their biggest fiscal deficits and added up noticeably to their debts in 2009.
Each one has its own track-record, however.
This is exactly what sets Greece apart from the rest.
Each country is unique in its own way, there being obviously overlapping between them.

International rating agencies must make the effort to closely monitor and register those differences and then advise financial markets.

After all it is sovereign countries and sovereign debt one is dealing with.

There is much more at stake than strictly soulless bundling of nations.

Arquivo do blogue

domingo, 29 de maio de 2011

TEc debate motion "This house believes that the West should keep out of the Arab world's revolutions" - Why I mostly lean to agree.

By and large I agree with the motion statement but would add that President Obama's approach to ongoing cries for freedom seems the right one.
It has so far been based on sound judgment, moderation and in-depth knowledge of relevant variables at play in the Arab and wider Muslim world.
Rash assessments and decisions may sound appealing to many on opposing sides but would certainly trigger unintended results. These would ultimately run counterproductive to the essential goal of an orderly transition to Democracy in those societies so vividly yearning for it.
It takes time, patience and a clever mix of soft and hard power. Above all a longer-term vision that does not contribute to power voids eventually leading to failing States.
I believe the West should mostly stay out adopting a measured response whenever deemed fit of an often unpredictable unfolding situation.
To my mind the American Administration is doing the right thing for the right reasons.

TEc "Catching up" - India-Africa courtship

India's African credentials date back to many centuries, indeed to the days when Indian, African and Arab Kingdoms traded along Africa's east coastline. Long before the arrival of Europeans to the Indian Ocean.
Later, history would place them on the same side notably in South Africa as a result of objective State-sponsored social discrimination and shared political oppression. To different degrees, it must be said.
As a sovereign State independent India stood up for African emancipation from colonial rule.
It is fair to say that the country did its best - despite severe home constraints as pointed out by The Economist - to promote African rule which was finally achieved across the Continent since the nineties.
India's economic reforms and liberalization enacted in the early nineties produced an upbeat nation posting hefty growth rates.
Going forward a new rapport is called for that takes into account mutual social, economic and material gain.
India can deliver on multiple fields at competitive cost to suit needs felt across Africa. Many companies are already doing what they know best to engage with African markets profitably, boosting still rather meager two-way trade figures.
India's African push need not be seen as a contest with China or indeed any other country or trading bloc.
Africa's interest - that of most of its individual countries - lies squarely with seeking to advance trade ties with the wide world. From a negotiating position that identifies and promotes every fast-track to social, economic and infra-structural development.
India, on the other hand, has shown the world that an overpopulated poor country has turned itself into a fast rising star able to deliver. On its own merits and strengths.
Economic prospects there have never been as bright.
That necessarily spells an ever increasing profile, ambition and reach over the coming decades.

terça-feira, 24 de maio de 2011

TEc "Strong core pain in the periphery" - It isn't quite like that.

Clearly what we now have in the EU is a three-speed league.
Core countries are not doing equally well as the title to this article might suggest. Discrepancies are wide enough that have economies performing significantly differently across multiple criteria.
The real pain, however, falls on the - for this purpose - ultra-peripheral nations of Greece, Portugal and Ireland knocked over by a combination of home negatives that converged now but each built up over many years. Plus the fact that they are smaller economies, therefore more prone to getting pushed around.
Where size truly matters is best seen in so far as the UK is concerned - strengths being the long term maturity of its debts, the pound sterling as a sovereign currency and growth potential as perceived by the markets. Also, the resolve displayed by the current UK government to aggressively rein in public finances.
The troubled threesome have got their hands tied behind their backs unable to implement any counter-cyclical measures just when they were needed most. Vital breathing space having been all but eliminated in exchange for bailouts whose outcomes are far from straightforward. Greece is already a case in point.
The larger Euro-zone for its part is by no means out of the woods yet.
The insatiable nature of financial markets, ill-advised by obscure rating agencies, makes any attempt at prediction a worthless exercise.
While the troubled three will eventually muddle through market spotlight is going to shift to other indebted countries.
If Spain or Belgium should be targeted next something very powerful will have to be done to secure the Euro as we've known it since birth.
Or an unconditional surrender by EU politicians ensues.
And former grand European ideals fall flat under the winning streak of mighty financial markets.
Their unorthodox ways driven solely by time, opportunity and quick profit overpowering all else.

quarta-feira, 18 de maio de 2011

TEc "Trichet the intransigent" - Jean Claude is about to go but he sticks to his views

The way the Greek sovereign-debt crisis unfolded itself shows a winding dark path to pitfall.
The more likely outcome of a long agony dragging a country of +11m down the road of despair is shrouded in thick layers of cynicism, delay and uncertainty.
The only known quantity that stands out is one of doom and gloom beyond anything that might have been conjured up as recently as last year.
Where is Greece and the larger Euro zone heading for?
Is anybody, from top politicians to top economists, truly able to answer that one question?
Apparently not.
No matter how highly qualified and opinionated, every written or spoken argument exchanged so far only adds to the mess already created.
Proposals put forward to eventually arresting the Greek crisis look like the lesser evil among others.
A cycle of negativity has set in that promises to further undermine the future of the Euro zone-17, particularly the threesome of highly indebted nations with sluggish near-term growth prospects at best.
How then to break free from the shackles of adding debt to pay for debt while economies go into free fall?
For Greece and Portugal multiple negative factors have lined up simultaneously to make a bad situation even worse:
high commodity prices, high interest rates (with the ECB aiming to raise them further), an undisturbed Euro riding high on the strength of growing economies to the north, a direction-less EU no longer focused on set collective goals, etc.
In Portugal's case add political limbo to all of that at least until the next - hopefully strong - administration takes over.
The EU, the ECB, the European Commission do not seem to lead whatever. All look perilously flimsy at the mercy of events they do not remotely control.
It is as if events force themselves in after protracted painful process.
Then only institutions grudgingly adapt to them, when left optionless.
We may still see the day that the ECB is made to change how it views the restructuring of Greece's burdensome debt.

quinta-feira, 5 de maio de 2011

TEc "IAI - IsraeliAircraftIndustries takes wing" - When small can achieve big.

That a small country with a 7.5m population should possess a sophisticated defence industry at all speaks loud for Israeli achievement. Born to military and security needs no doubt but remarkable in every way nonetheless.
Outside of industry insiders few are actually aware Israel boasts a multibillion dollar company such as IAI. Operating at the forefront of technology and manufacturing offering prized and skilled employment to many.
Also, conferring a higher profile to a country too often associated with relying entirely on US financial assistance and hardware supplies.
What the article brings out is that small countries with obvious size/scale limitations may also rank among the majors even on 'tough' sectors as plane-making.
And IAF is about much more than aircraft.