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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

terça-feira, 6 de dezembro de 2016

TEc - Fuel Folly - elevating risk to the highest level

Every air accident is a sad event - or any accident for that matter - but this one is sadder than most. The facts are pretty much exposed and hardly anything further is needed to reach a crystal clear conclusion: there can be no cutting corners when it comes to aircraft and flying. It is as simple as that, a longtime established fact - indeed since the dawn of aviation - that DOES NOT require any evidence whatsoever.
Because when it does show it takes the form of outrageous tragedies such as this one.
Then, there is the usual set of contributing fateful factors.
An accident that should never have been in the first place.
Flying remains the safest mode of transport by far, by all measurable accounts. But it is bound to fare the worst when human recklessness kicks in regardless of all else.
Precious lives have been cut short on a hillside in Colombia very close to their intended destination.
In this particular case, BASIC common-sense SAFETY was grotesquely bypassed. It cannot be underlined enough.
As always, there are accidents and accidents. Common to all is that every single one demands factual analysis to determine causes, contribute to further learning and importantly, prevent future recurrences.

terça-feira, 11 de outubro de 2016

TEc - The road to Brexit - Which road will it be?

Brexit is the topic of the day for learned opinion-makers as well as laymen across the length and breadth of the United Kingdom of Great Britain and Northern Ireland.
As it is the political fallout has been immense following a popular decision whose economic repercussions are beginning to sink in. The value of pound sterling is up to now the major practical barometer of things to come in a worst-case-scenario.Words such as hard or soft are commonly used to gauge the wide gap of possible consequences to the British economy.At the end of the day my own assessment indicates that it very much remains very early days to substantively assess anything at all. Even the currency's crash may be down to nervousness rather than a perceived deterioration of the UK's future trading conditions.Why then the rush of bad news when hardly anything is known about the UK's future relationship with the other 27 countries of the European Union? As the current UK government feels the ground ahead of invoking Article 50 of the Lisbon Treaty, the European Commission and several heads of government have publicly voiced their views.I am ever amazed at how unprepared hardline Brexiteers seemingly were about their case as much as the apparently orchestrated punishing statements made by leaders of Europe's other relevant nations hellbent(?) on exacting an expensive price on Britons for their irresponsible folly(?).Few seem to take the moderate constructive path that will ensure a positive outcome for UK citizens, European citizens at large and, above all, Europe as a geographic, cultural, economic and military bloc. Yet, that would seem to me the only acceptable way forward in the new context.If Democracy is the foundation, the cornerstone of the European edifice then it need be fully upheld and respected especially so when outcomes do not conform to the expected. Such is the case after the In/Out UK referendum result became known regardless of late discussions about the merits/demerits of calling for one on an issue as complex.The UK's future is neither as bleak as some are painting it to be nor as rosy as others would wish the rest of us to believe.Voting to quit the EU was a deeply political choice with major economic and social implications.Politicians on both sides of the Channel must rise up to the challenges and hammer out the best deal for the UK and the remaining 27 members of the EU.A potential lose a lot-lose something must be turned into a win-win for the benefit of Europe as a whole.

sexta-feira, 30 de setembro de 2016

TEc - How to not spend it - Norway's style of handling of wealth

There is so much countries around the world can learn from Norway.
Despite sitting atop a massive pile of cash Norwegians take the long-term approach to managing their natural bounty. Prudence seems to be the key word that garners widespread support among citizenry, decision-makers and most politicians alike.
Suggestions on how best to invest revenue from such a mountain of capital, or part of the capital itself, will always swirl around but to this day cautious, should I say wise, management of the Fund has prevailed.
Of course this bodes well for future generations of Norwegians and Norway as a country/State.
Through the highs and lows of oil prices and its eventual depletion, through the thicks and thins of Norway's collective economic life, the mammoth sovereign-wealth fund has been, is and will continue to be a source of national strength and reassurance.
For now it remains in very safe hands whose rational minds have steered the Fund to ever greater heights!

sexta-feira, 22 de julho de 2016

TEc - GDP forecasts for 2016 - what should we make of forecasts?

Forecasts by and large remain truthful to themselves only. Forecasts they are and should thus be taken at face value, no more no less.
In the recent past so-called credible institutions produced heaps of forecasts that soon proved to be grossly erroneous misleading professionals and commoners alike.
I have come to believe that such predictions and the frequency of their release aim to become pressure tools rather than the mere hypothetical pointers that they will forever be.

domingo, 17 de julho de 2016

TEc - May time - A new PM takes over

TEc has made it crystal clear where it stood before and after the referendum. As a specialist newspaper on matters pertaining to the economy its dominant line is unapologetically tilted away from pure politics.
Yet the new PM faces the daunting task of gathering many tasks together to then arrive at sensible policies acceptable to both the EU and the UK as a whole. Most of them inherently political in nature. Scotland and Northern Ireland, despite their scale and specificities, cannot be side-stepped at any point in time. A first signal was already given by TMay's early visit to Edinburgh.
The question mark that looms large is whether or not the UK's relevant sticking points are compatible with a EU whose main tenets consistently jeopardise those very points.
Can they ever be made compatible?
My point is that they have to.
The UK is important enough to continental Europe to turn it into a mere case of conditioned access to the single-market. Conversely, the EU, for all its current failings as seen by hard-line Brexiteers, is critical to the UK far more than the 450M+ internal consumer market would suggest.
This is why I can only envisage high Politics eventually taking centre stage during negotiations regardless of how hard or protracted.
When it comes to the nitty gritty of actual decisions being made both sides must bear in mind their relative weight set against a far larger backdrop of European peace, security and the welfare of citizenry across the UK and the EU.

sábado, 9 de julho de 2016

TEc - Theresa May and Andrea Leadsom vie to become Britain's next PM - tough job looming

´Political science in the making´ would be a good label for the fallout from the In/Out Referendum.
150.000 Conservative party members will now decide between two women who backed the opposing sides of the argument. The winner will have the unenviable task of delivering on any number of fronts for the greater good of the UK.
For all the relevant cabinet experience that they may have, at the end of the day it should matter politically the very views each held during the campaign. The result may also show the depth of anti-EU feeling among the party faithful - irrespective of the Parliamentary group - or their wish to soften the stance in view of post-referendum consequences to the British economy and society already felt.
Bottom line is the UK has placed itself in a reasonably tight spot. One that calls for the leadership to show a fair amount of pragmatism, knowledge and ability to compromise. They will have to sail the country through what may only be described as unchartered territory where headwinds are likely to be met.

sexta-feira, 24 de junho de 2016

TEc - Tragic split - UK goes it alone. To uncertainty...

No doubt Europe is witnessing a very sad day. One that could have been avoided if only, at European level, a lot more respect were shown by EU officials towards the common peoples of Europe.
The structures of an evolving European Union whose political goals have all but been lost to the strains of globalization, also lost touch with the very peoples they purport to serve. The defeat of Remain is as much the fallout of domestic issues as it is about the failings of the EU despite Britain's already significant aloofness.
The UK is known to be a rather peculiar case indeed since applying for membership of the Common Market back in 1963. Twice snubbed by deGaulle the island nation would finally join in 1973 to hold a confirmation referendum only just two years later.
But the unease has prevailed throughout and is best exemplified in the many Opt-outs the country negotiated on core EU policies.
To my mind, an In/Out referendum was therefore inevitable. It would always be a matter of time before widespread feelings of mistrust towards the EU - stoked by an inflammatory, parochial and irresponsible tabloid media - would find echo in the political establishment. Everything made worse by the surge in net migration into the UK especially from 2004 and 2007 when two EU enlargements took on mostly eastern european countries.
DC hardly had a choice. If he did not push for a vote somebody else would sooner or later.
Time now to move on.
Having lost on an existential issue in a high turnout vote with a relevant gap between the options left him no alternative but to step down immediately. He has done so gracefully following a very high-stakes gamble the Remain camp never made the full case for.

A new chapter opens up today for the UK and the EU.
There will be short-term pain but only time will tell whether this has been the wiser choice made by the British people.

sexta-feira, 10 de junho de 2016

TEc - Indian solar power - an overblown numerical ambition or a real target?

This is a very very tall order by any stretch of imagination. As tall as you can have them. Optimally achievable it may theoretically be but I would rather rate the target as an intentional overblown numerical ambition. Anything close to it by 2022 will amount to a staggering victory.
I will then wilfully take my hat off to all who have today upped the stakes this high.
Leading and showing the way forward is paramount for any government. I do think that the skies over India have never been sunnier too.
However, there are also some considerable odds that call for realistic optimism barring which generously set targets, if recurrently missed, are no more than discredited hollowed out numbers.

quinta-feira, 12 de maio de 2016

TEc - The eye of the storm - Competition is tough but can be managed

Boeing still commands the league tables in more ways than one, Airbus constantly challenging those positions since its own inception.
In fact, Airbus' rise to world prominence in less than half a century is a major achievement industrial Europe can justly feel proud of.
There used to be a monopoly in commercial planemaking, now a duopoly has been firmly established since long. Arguably, two smaller makers from Canada and Brazil are nibbling hard at the regional jets segment while aiming higher as well.
Other countries such as China, Japan and Russia want a piece of the action too. Small entrants they may now be but if Airbus itself is anything to go by, are we headed for increased competition and multiple suppliers vying for a slice of the pie?
Far removed it sounds for now. Both Boeing and Airbus should, however, take note that their de facto duopoly may eventually be broken up.
What is unclear is the commercial fate of outsized wide-bodies such as the B747-8 and the A380. Airbus initiated the contest by setting in motion the A3XX program gambling heavily on its much vented view that the civil aviation market was asking for large volumes carried over long distances. This would bring unit costs down to minimums, the ultimate objective of very large aircraft.
After the first bout of large orders, especially from Middle-Eastern carriers and a few incumbent flag airlines, the order books appear to record no more.
It might be a temporary market reassessment made by the airline industry before a new sizing up of fleets to take on the many expected first-time travellers from emerging countries?
Answers will soon be found.
Lastly, the cost overruns of Boeing's Dreamliner program is staggering beyond belief. Ambitious projects to develop and apply new materials and technologies commonly demand more money but a +5 multiplier is well outside any reasonable scale.

quinta-feira, 5 de maio de 2016

TEc - Trading places - Trade-averse opinion surfaces because of the TTIP agreement?

TTIP - Transatlantic Trade and Investment Partnership
There is no aversion to global trade as such. There is, and rightly so, deep-rooted concern that the international trading system is somehow rigged. Is it not?
This has pushed countries to compete against each other on a hugely unlevelled playing field whose framework is invisible to most except to the insiders who actually set it up.
No matter how it is looked at, enough pointers are seen showing imbalances causing a handful of countries emerging as clear winners while others have become recurrent losers.
That the stakes are high cannot be overstated. It only took a little over a decade to produce massive changes to trade flows. Consequently, to production centres, tangible wealth of nations and the current account balances of many a country.
Europe and America still remain the world's most important trading blocs but their relative weight is on the wane. Europe in particular shows multiple weaknesses as its manufacturing has been continually eroded, the exception being Germany and a few smaller countries around it.
Trade is the cornerstone of wealth creation, economic growth and development. Trade deals - bilateral or multilateral - must be hammered out to reflect the interests of all parties concerned as measured by volumes, figures achieved and communities benefited.
Should imbalances arise then the deals need to be reviewed or scrapped altogether.
The TTIP is stirring disquiet in the heartland of Europe's trading powerhouse.
There must be sound reasons for that.

quinta-feira, 28 de abril de 2016

TEc - Spanish steps - uncertain future for Portuguese banks

It is hard to even begin to contemplate the pitiful state of Portuguese banking.
Indeed, I saw some of it coming years ago perhaps because the people in charge were telling the rest of us that the banking system was rock-solid. Yet, it would have caught the attention of more than a few that loans were being given to the wrong people by the wrong hands. Banks and the political establishment have in Portugal gone to bed time and again since long.
Still, I am awed by the sheer scale of the problems as one bank after another - previously deemed as reputable - has simply collapsed. The costs keep piling up further straining already fully stretched public finances despite repeated assurances that taxpayers would/will not pick up the bill.
As things stand nobody knows what will be made of Portuguese banking into the near future. Whether in the hands of larger Spanish banks or the filthy-rich Angolan few, genuine home-grown Portuguese banks held by Portuguese capital look set to shrink further.
To cap it all there are the rather tricky issues arising from the Angolan connection. And the ways its government/leadership finds of exercising power over their uneasy former colonial masters through means close on not-so-sophisticated nepotism.
Nevertheless, the main blame lies squarely in-house with bankers who failed their own folk and country miserably.
The last few lines of the article sum it up beautifully as is invariably the case in a multitude of issues across the board.

quinta-feira, 31 de março de 2016

TEc - No, thank you - Is the UK economy condemned to industrial irrelevancy?

A brief overview of Britain's steel industry is made here that provides enough food for thought.
The wider issue that afflicts many other developed economies is how best to counter the overriding Chinese threat - a country that is able to mass-produce just about everything at cutaway prices. As is plainly clear that too because it does not abide by the same rules as in countries/societies whose industries have in a long time had to factor in costs Chinese firms may simply overlook. Not to mention latter-day pollution related charges.
But as China itself becomes wealthier and increasingly developed, production costs and social and political demands there will inevitably rise.
In a world that is far from showing willingness to build a level-playing-field for companies/sectors/economies to compete, how then is steel-making to survive in higher-cost countries such as the UK? Some costs likely need to be reduced but never will overall production costs reach levels achieved in places where general standards are much lower across the board.
How does Germany still manage to display remarkable stability of its mighty industrial sector despite being a high-cost country as well?
Is the UK condemned to watch helplessly the eventual closure of its largest steel mill?
Strictly going by market-economy purists, tariffs are not to be slapped just as any type of seemingly protectionist measures remain off bounds.
What they fail to mention is that there are enough distortions upstream and far too much at stake downstream if the UK is to attach any relevance at all to what is left of its industrial sector - core industries and manufacturing

segunda-feira, 14 de março de 2016

TEc - Three regional elections have radically changed Germany's political landscape - wakeup call

Moderates from across the German political spectrum - at Federal as well as Lander level - would do well to read carefully into the three regional election results.
It is a first democratic warning that there is growing disquiet among ordinary Germans concerning policies Angela Merkel has pushed through unabashedly lately. It cannot all be dismissed to populist party politics that has drawn so many to a newly set-up construct voicing legitimate societal concerns. Failure to notice the writing on the wall will only fuel further future support for politicians who catch the mood of large sections of the nation regardless.
The fact that Germany remains on a sound economic footing, and average Germans do not need to worry as much as their fellow Europeans to varying degrees, does not warrant unchecked support for the parties in the federal coalition government.
More so at a time when there are any number of major issues that need to be addressed concurrently.
And variables that must be weighed in at the very least.

quinta-feira, 25 de fevereiro de 2016

TEc - Boris Johnson is wrong: in the 21st century, sovereignty is always relative - I do agree but there is a recurrent English nag on Europe

 A remarkably balanced article that is as 21st century attuned as it is wise.
That said, however, I have long understood British - should I say English (?) - disquiet about the EU. All suspicion aggravated by the messy state of affairs in Europe underscored by Brussels reaction to multiple events especially in the aftermath of the 2007/8 financial meltdown. And rather disheartening clearly differentiated handling of nations large and small.
Essentially it is an internal question that needs to get sorted out by the UK's political body and people.
A referendum on such issues is never a soft option. On the contrary, DC raised the stakes to a level he could no longer backtrack from. Indeed, he is only delivering on his own election campaign pledge.
For the British people at large a new opportunity has arisen, yet again, to express their views hopefully from as informed a standpoint as possible. If all the pros and cons of EU membership are balanced against the reality of a fast changed globalized world then I wonder which way majority opinion will sway.
The very outcome as measured by voter turnout and the gap between the Ins and Outs will provide insightful information on UK public sentiment towards the EU.
In the meantime there remain 4 months for citizens to seek enlightment and make their minds up.