This is a great interview published to the Scientific Coordinator of the Portuguese Permanent Justice Observatory in Publico, a few months back. It offers a very clear summary of the issues that now hamper Portugal's justice development. It is in Portuguese - but is a great and recommended reading.
Wednesday, 27 July 2011
Are rating agencies using the same criteria?
I think this is a very valid question when you look at US and European debt situations.
Actually, US situation is not that different from the EU, namely when one thinks:
- US Sovereign Debt vs GDP was 92% in 2010, actually the same as Portuguese one (91%) - source IMF;
- The situation is especially critic in some of the States - with parcial Governmental services closures in California and total closures in Minnesotta in July;
- Unemployment rates are climbing or at highest levels;
- Many US States actually have strong competitiveness issues, that are only masked away by the others strength (like what is happening in Europe, with Germany and Portugal, just as 2 examples);
- A single currency in both regions don't allow for Monetarian adjustments to boost competitiveness (oh, I am sure Louisiana would love to be able to depreciate its currency, aren't you?);
- Federal political inabilities are hampering the speedy resolution of the underlying issues jeopardizing the economy.
So, if actually the US are not that different from Portugal, Ireland and Spain, are rating agencies actually using the same criteria? I believe the reasons that hamper US Sovereign Debt rating degradation, but I am really feeling that though European economies have issues, they aren't as bad as justifying the current ratings given by Moody's, S&P and Fitch...
Tuesday, 26 July 2011
US Debt agreement failure - consequences in a nutshell
So, a default on the World's largest economy and debtor?
I think we would see a credit rating degradation of US bonds and therefore consequences on credit cost would that would rise in the US (and on other regions in the world that are exposed to US sovereign debt), making it more expensive to get credit. But this would also affect current credits, as most of their spreads are set vs floating indexes. This could then prompt a new wave of defaults by individuals as well as businesses, creating a possible recession.
This is the simple scenario - and we all hope not to understand if it would be like this.
Saturday, 23 July 2011
On the importance of justice
A very good set of articles in "Portugal visto de fora", about the importance of Justice and why it is hampering Portugal's development. You will need to read Portuguese... I will just be highlighting two of these articles - but they are six of them, and all very good!
http://www.portugalvistodefora.com/2011/07/porque-democracia-e-menos-importante.html
http://www.portugalvistodefora.com/2011/07/democracia-e-menos-importante-que-o.html
The right answer
"You will not destroy us. You will not destroy our democracy and our ideals for a better world." - Jens Stoltenberg, Norway's Prime Minister, on the wake of yesterday's terror attack.
This is the best answer. And we must always walk the talk, especially on such a strong statement from whoever attacked Norway.
Friday, 22 July 2011
Is this enough?
A number of measures were agreed yesterday at an European summit to put a halt to the continuous climbing of interest rates in Southern economies and thus protect the Euro. Those measures though important for the concerned States, are but baby steps. The only solution to the nowadays crisis comes in the form of an European-wide economy - including an European Finance minister and coordinated policies, namely taxes, incentives and so on. The root cause of nowadays crisis is that lack of unified economy - and we need it if we want to keep a single currency.
http://economia.publico.pt/Noticia/banca-empresta-37-mil-milhoes-para-nova-ajuda-a-grecia_1504156
Thursday, 21 July 2011
Normal?
Should we, voters and taxpayers, consider it normal that elected politicians can earn not only their rightful salaries but also pensions proceedings? Just a question, as it comes out of our pockets...
Tuesday, 19 July 2011
The US debt limit - an angle of thought
One of the things I don't understand on the American budget discussion is actually the point that is central to the discussion.
So, the US have a law (it is an amendment to the Constituition, right?), that imposes a debt limit. Actually, that makes sense, because (theoretically) it forces Governments to keep their operational expenses under control and public investment productive. In a way, it would be a preventor to what we are seeing in some European economies.
Now, it seems for years, that actually the US Governments (don't blame it only on Obama's) didn't care too much about this law and its limit. And now, the focus is in raising the limit, without attacking the underneath causes. We are even seeing (the dreaded) rating agencies asking for that raise.
The point is - ok, the US now needs to raise the limit. But shouldn't the US focus on actually understanding how to keep their (huge! - % is not that different from the Portuguese one...) debt under control?
Thursday, 14 July 2011
Not a surprising move
As expected, Banco Espirito Santo, one of the biggest Portuguese banks and the one who retaliated Fitch rate cut a few months ago, has started contacts to be rated by Dagong, the biggest Chinese rating agency. Not a surprising move in my opinion, given the latest moves by the American rating agencies - it is actually better to also diversify the portfolio of rating agencies to spread out biased evaluation risks...
P.S- And I have written something similar relating to the European financial sector - it is a few posts below...
Turkeys
Oh no, another quote! Yes, it is true - I've learnt it today, thanks to Alistair.
"Turkeys don't vote for Christmas" is a great sentence to apply to so much on Politics...
Wednesday, 13 July 2011
Juggling balls
"Imagine life as a game in which you are juggling some five balls in the air. You name them – Work, Family, Health, Friends and Spirit and you’re keeping all of these in the Air.
Thanks for the quote, Wayne!
You will soon understand that work is a rubber ball. If you drop it, it will bounce back.
But the other four Balls – Family, Health, Friends and Spirit – are made of glass. If you drop one of these; they will be irrevocably scuffed, marked, nicked, damaged or even shattered. They will never be the same. You must understand that and strive for it.” Bryan Dyson (CEO of Coca Cola)
Monday, 11 July 2011
A shout!!!
The only way Europe is gonna climb out of this mess is to move forward on economical integration! We need an European Finance minister! And we need eurobonds now, to stop the degradation on Spain and Italy's finance! And now is now!
What should Europe do with the rating agencies?
Actually, probably the only thing Europe can do is to (how ironic is the world, right?) support Asian rating agencies right now, whilst ensuring support for its own European sponsored agency that would need to come next year (too late?)...
Sunday, 10 July 2011
Unions
The present crisis situation in Portugal, with high unemployment, job benefits cuts and an overall recession should be considered the perfect fuel to enhance union power recovery in the country, reversing the years long decline in the number of associates. Still, for that to happen, unions should have gone through a major transformation years ago - the fact is the rhetorical speech without any concrete and modern proposal only undermines their position. Adding to that, the fact that the general work population doesn't trust unions, as they are seen more as a political tool for some parties than actually working and defending the interests of their associates. As so, the next few years will probably be another lost chance for Portuguese unions.
Friday, 8 July 2011
Portuguese Parliament - contacts
A key concept in democracy is that deputies are exactly that - they are just the representatives of the People in the parliamentary assembly, and, as any employee, should be held accountable. As so, let me include here a number of key contacts, publicly available through the Portuguese Parliament website. I strongly encourage you to contact these groups, and hold them liable for their actions.
| Grupo Parlamentar do Partido Socialista | Palácio de S. Bento 1249-068 LISBOA | |||
| Tel.: (linha verde) / Fax: 213917444 | ||||
Enviar e-mail  |
| Grupo Parlamentar do Partido Social Democrata | Palácio de S. Bento 1249-068 LISBOA | |||
| Tel.: (linha verde) Fax: 213917443 | ||||
Enviar e-mail  |
| Grupo Parlamentar do Partido Popular | Palácio de S. Bento 1249-068 LISBOA | |||
| Tel.: (linha verde) / Fax: 213917433 | ||||
Enviar e-mail  |
| Grupo Parlamentar do Partido do Bloco de Esquerda | Palácio de S. Bento 1249-068 LISBOA | |||
| Tel.: (linha verde) / Fax: 213917459 | ||||
Enviar e-mail  |
| Grupo Parlamentar do Partido Comunista Português | Palácio de S. Bento 1249-068 LISBOA | |||
| Tel.: (linha verde) / Fax: 213917432 | ||||
Enviar e-mail  |
| Grupo Parlamentar do Partido Ecologista "Os Verdes" | Palácio de S. Bento 1249-068 LISBOA | |||
| Tel.: (linha verde) / / Fax: 213917424 | ||||
Enviar e-mail  |