Willi , Sass , ben et al can you

[Jawge]

guys take this article apart for me? I'm very intersted to hear your views on it. Thanks.

http://www.jamaica-gleaner.com/glean...us/focus1.html

[Jawge]

Anyone with knowledge of finance around here? Helloooooooo.
maybe I need a flashlight.

[Assasin]

"This is why the debate is necessary. Not for the parties to grandstand but for the public to be educated about supposed alternatives and painless paths. One of the greatest forms of corruption in Jamaica is intellectual corruption. People fear to speak the truth because they fear being penalised for their opinions or because they want to curry-favour with the rich and powerful. But we must debate these issues, for we have already seen the incalculable damage that economic misadventures can bring."


first and foremost let me say this statement needed not to be at the end but at the begining.


Secondly low interest rate by itself will only fuel inflation. There are some things which I would address.

The fact is Loq interest rate have to go hand in hand with good control of inflation, the dollar, GDP and other financial such as balance of trade and the fact that government can't just can't issue bonds at their will to balance budget.

High interest rate provide a problem for local investors to raise capital for their businesses. One of the result been now we have a lot of foreign owners in Ja who have no problem getting capital in their countries while the local counterpart have to struggle to pay 30% on their debt.

Can there be moderate interest rate and better management of the economy? The interest rate should never be raised by 20 points in 2 weeks. That is crazy as businesses strive better in a stable condition.

We talk about Japan but unlike Japan many of their companies can raise capital on their own and I don’t see their dollars flying off the shelf.

Things have to be managed properly with interest rate at level people can afford, We need moderation it doesn’t have to be high interest vs low interest rate, there are other alternatives and better management is needed.

[Jawge]

Don't you think the 30% would be in keeping with the value of the dollar? Low interest rates would disregard the value of the dollar only to further devalue it. What are the alternatives you speak of?

[Assasin]

there is alway alternatives. Make low interest loans to people in production and manufacturing. They do it for tourism and farmers from time to time.

Plus it creates a set of people who just buy the government bonds and wait to collect while the government use this source to finance the budget and run up the clock.

You can also put duties on import and use the usual trick other countries use to limit consumer goods import. The high interest rate in the long run has never stop the devaluation of the Jamaican dollar. Check it from 1990-now.

If it is necessary to push up the rate it must be temporary and not use for such extended time frame.

[Gamma]

one case involved a man being encouraged by the baker to get a low interest development loan, putting it in high interest account with a commercial bank and being offered overdraft facility where monies from a savings account was to servie the current account and by extension the overdraft on a monthy basis...the bank did not action this and the interest on the overdraft kept on being compounded until...it was astromnomical...

the bank use the man to get the other banks money, make money on it and SCREW di man 'pan top a it!!

[Assasin]

and nobody nuh go a jail.

[Willi]

Not much substance there....

What do you want elaboration on?

[Jawge]

Point out what you see as "not much substance" thanks.

[Willi]

All of it.

[Gamma]

i mean to say........

[Jawge]

Great. Now post some counter arguments that would contain what you view as "substance". Thanks.

[Willi]

Too busy.

[Jawge]

Fine, the above will stand as substance until you are not busy to prove otherwise.

[Gamma]

LOL!!!! incredible yet, understandable.