fimbo
Junior Member
Posts: 60
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Post by fimbo on Aug 7, 2013 23:38:19 GMT 3
You are rushing to declare the country bankrupt because there is no cash in the till. But have you even ventured downstairs to the basement to see what is hidden in the vault?
I do not wish to complicate this issue any further, but what does it even mean for a country to go bankrupt on debts it owes to itself?
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fimbo
Junior Member
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Post by fimbo on Aug 7, 2013 23:43:55 GMT 3
All of you have provided juicy examples of failed states, dictatorships (military or otherwise), klepto-cracies, where the public accounts/assets are indistinguishable from your favorite dictator's petty cash. I dare you to name one even bankruptcy in even [semi] working democracy. The caveat here is failure to pay local debt. Foreign debts are another story. I am going to look for my original article on Greece I remember doing on Jukwaa about a year ago. Malta which sunk the other day is too small to mention ---though her economy, thanks to a bloated artificial banking sector was bigger than Kenya's! Iceland too went bust ---her population is smaller than Kisumu's, thought her GDP at its banking bubble peak was bigger than South Africa's! But it is Italy that will shock you. It is a top ten economy in the world, but it recently became a German colony to save itself from bankruptcy! The truth is a man like Zuckenberg of Facebook can easily buy off all Kenyan state debts. That is to say, Rotich's problems are small change! Greece has 10M people. The first package of her bail-out I think was 10 billion euros. IMF loan to Kenya which was a great shot was a mere 105 Million dollars. Kenya has 40M people. Wuothi eka ine! In this range of figures, when people like Rotich head a treasury which can not run a payroll of a few hundred million Kenya shillings, there are some questions you do not want to ask yourself as an African. ---Got to spare yourself some pain! Greece is part of the EU and CANNOT print anything. Iceland was bamboozled by the EU (read UK), and its debts, from bank bailouts, were owed to foreigners (UK).
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Post by mank on Aug 8, 2013 1:48:23 GMT 3
I am going to look for my original article on Greece I remember doing on Jukwaa about a year ago. Malta which sunk the other day is too small to mention ---though her economy, thanks to a bloated artificial banking sector was bigger than Kenya's! Iceland too went bust ---her population is smaller than Kisumu's, thought her GDP at its banking bubble peak was bigger than South Africa's! But it is Italy that will shock you. It is a top ten economy in the world, but it recently became a German colony to save itself from bankruptcy! The truth is a man like Zuckenberg of Facebook can easily buy off all Kenyan state debts. That is to say, Rotich's problems are small change! Greece has 10M people. The first package of her bail-out I think was 10 billion euros. IMF loan to Kenya which was a great shot was a mere 105 Million dollars. Kenya has 40M people. Wuothi eka ine! In this range of figures, when people like Rotich head a treasury which can not run a payroll of a few hundred million Kenya shillings, there are some questions you do not want to ask yourself as an African. ---Got to spare yourself some pain! Greece is part of the EU and CANNOT print anything. Iceland was bamboozled by the EU (read UK), and its debts, from bank bailouts, were owed to foreigners (UK). So you are doubling down on the printing option as a wealth creator? I wish you would expand the preceding thought: You are rushing to declare the country bankrupt because there is no cash in the till. But have you even ventured downstairs to the basement to see what is hidden in the vault?
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fimbo
Junior Member
Posts: 60
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Post by fimbo on Aug 8, 2013 17:58:43 GMT 3
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Post by mank on Aug 8, 2013 18:17:32 GMT 3
Mank, Where is your imagination? A country has many other assets that can be liquidated to pay off debts. Fimbo, I had the unfair imagination that you were about to introduce a big thought. I had some ideas of what you might have been alluding to with " But have you even ventured downstairs to the basement to see what is hidden in the vault?" If all you were about to say is that a country does not have to go bankrupt because it can liquidate its "other assets" (in addition to the first lifeline it holds, according to you, of printing and printing), then we really do not have a discussion. In my mind's eye I can now see OtishOtish laughing at me.
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Post by OtishOtish on Aug 8, 2013 18:37:21 GMT 3
If all you were about to say is that a country does not have to go bankrupt because it can liquidate its "other assets" (in addition to the first lifeline it holds, according to you, of printing and printing), then we really do not have a discussion. In my mind's eye I can now see OtishOtish laughing at me. I would never laugh at anyone; but I would urge you not to be led astray by your new friend, fimbo, and to heed my warning on the dangers of self-pleasure, which, I understand, can cause blindness. Anyways ... these comments on printing just gave me a bright idea: While the government is running the printing press to pay for this and that, it could also eliminate poverty in one fell swoop. All is has to do is print as much money as those who don't have any need and then hand it out.
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Post by jakaswanga on Aug 8, 2013 19:55:36 GMT 3
You are silly Fimbo: take a look at this quote. Trust me. You should bother to read Mank before you comment on him when he does this econometric kind of stuff. Good thing I read elsewhere that Kenya is a mineral-rich country now. I choose to treat that like I would an April 1 prank, but I know our policy makers won't lose the opportunity to coin another program for the new mineral giant of the world! I put it to you, Man-K was ALREADY cognisant of the 'contents of the vaults'. And elsewhere I and him mentioned 'Turkana black gold' in the light of a speculative currency fortifier! I think with you this discussion is now closed!
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Post by jakaswanga on Aug 8, 2013 19:58:33 GMT 3
Mank, Where is your imagination? A country has many other assets that can be liquidated to pay off debts. Fimbo, I had the unfair imagination that you were about to introduce a big thought. I had some ideas of what you might have been alluding to with "But have you even ventured downstairs to the basement to see what is hidden in the vault? Read more: jukwaa.proboards.com/post/124933/quote/8589?page=4#ixzz2bOHLUxup" If all you were about to say is that a country does not have to go bankrupt because it can liquidate its "other assets" (in addition to the first lifeline it holds, according to you, of printing and printing), then we really do not have a discussion. In my mind's eye I can now see OtishOtish laughing at me. Mank, that jukwaa link you gave is bouncing? is the mistake mine?
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Post by mank on Aug 8, 2013 20:01:55 GMT 3
If all you were about to say is that a country does not have to go bankrupt because it can liquidate its "other assets" (in addition to the first lifeline it holds, according to you, of printing and printing), then we really do not have a discussion. In my mind's eye I can now see OtishOtish laughing at me. I would never laugh at anyone; but I would urge you not to be led astray by your new friend, fimbo, and to heed my warning on the dangers of self-pleasure, which, I understand, can cause blindness. Anyways ... these comments on printing just gave me a bright idea: While the government is running the printing press to pay for this and that, it could also eliminate poverty in one fell swoop. All is has to do is print as much money as those who don't have any need and then hand it out. Thank Fimbo for the light ... although looking further back we must acknowledge that Fimbo is only breathing life into dead Idi Amin Economics
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Post by jakaswanga on Aug 8, 2013 20:08:05 GMT 3
I am going to look for my original article on Greece I remember doing on Jukwaa about a year ago. Malta which sunk the other day is too small to mention ---though her economy, thanks to a bloated artificial banking sector was bigger than Kenya's! Iceland too went bust ---her population is smaller than Kisumu's, thought her GDP at its banking bubble peak was bigger than South Africa's! But it is Italy that will shock you. It is a top ten economy in the world, but it recently became a German colony to save itself from bankruptcy! The truth is a man like Zuckenberg of Facebook can easily buy off all Kenyan state debts. That is to say, Rotich's problems are small change! Greece has 10M people. The first package of her bail-out I think was 10 billion euros. IMF loan to Kenya which was a great shot was a mere 105 Million dollars. Kenya has 40M people. Wuothi eka ine! In this range of figures, when people like Rotich head a treasury which can not run a payroll of a few hundred million Kenya shillings, there are some questions you do not want to ask yourself as an African. ---Got to spare yourself some pain! Greece is part of the EU and CANNOT print anything. Iceland was bamboozled by the EU (read UK), and its debts, from bank bailouts, were owed to foreigners (UK). You dared anybody to mention 'semi democracies'' that went bust! EURo countries that are bust and do not want the tough austerity of the German-led ECB, can always exit. They all refuse -to -GREXIT, CYXIT. If you think Greek drachmas printed limitless would keep Greece afloat, good luck. 85% of the Greek population said they would use their EU passports to migrate to EU proper, and quit Greece is the fatherland Exited the Euro-zone! Iceland, bamboozled or not by whoever, is a good example of a nominal democracy that went bust. So you will need to expand more on your printing press theory than just blame it all on the UK and the EU. That blame game does not strike me as any economic thinking, or any thinking in any case.
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Post by mank on Aug 8, 2013 20:12:23 GMT 3
Fimbo, I had the unfair imagination that you were about to introduce a big thought. I had some ideas of what you might have been alluding to with "But have you even ventured downstairs to the basement to see what is hidden in the vault? Read more: jukwaa.proboards.com/post/124933/quote/8589?page=4#ixzz2bOHLUxup" If all you were about to say is that a country does not have to go bankrupt because it can liquidate its "other assets" (in addition to the first lifeline it holds, according to you, of printing and printing), then we really do not have a discussion. In my mind's eye I can now see OtishOtish laughing at me. Mank, that jukwaa link you gave is bouncing? is the mistake mine? Brother Jakaswanga, That link is to Fimbo's posting just one step earlier. It just came along with "copy and paste", but it is really unnecessary. I will edit it out to avoid further confusion. Yeah, done with Fimbo and his Idi economics.
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Post by OtishOtish on Aug 8, 2013 21:55:06 GMT 3
Jakaswanga and Mank: As you guys get ready to shut down, I leave you with one question: Do you think Vision 2030 will get Kenya into the group of "middle-income countries" by said date? Consider, for example GDP per capita (PPP), and pick your favourite source of information here: en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capitaCan Kenya do it? Take a look at where Singapore is now and where it was in 1963 and compare with Kenya. A little story: Hard man Lee Kwan Yew once cried in public, with television cameras rolling. The occasion was when Singapore, early on post-independence, got kicked out of the Malay Federation. Lee thought that Singapore, then a tiny poverty stricken piece of land----Uhuru probably owns more land---could not make it on its own and that he had let them down. (He later decided to "show them", and during the Asian financial crisis, Malaysia would bitterly complain that Singapore refused to help it: the Singaporeans refused to give freebies or cheap loans; they wanted concrete evidence of a positive return on any "investment".) Anyways ... the fire at JKIA reminds me of a session at which I heard Lee talk; as the only African present, I really wished I'd spent my evening drinking instead: After the Malaysians told him to fwack off, Lee decided that he would have to find partners among African countries in a similar situation, and some time later he toured several African countries. It didn't work. At the session that I speak of, he described a situation in which he was hosted in a presidential mansion. When he went to brush his teeth, the tap gurgled before spitting out an orange-brownsish liquid. He went to the fridge and found a bottle of Fanta to use instead. He described the countries he had visited as "mostly parodies of countries". Have things changed? From first-hand observations of Singapore and South Korea, I would suggest that Kenyans stop dreaming and that GoK gets serious. Jakaswanga has been full of praise for Schacht, so here's a thought: instead of autarky on a national scale, as we normally understand it, how about autarky on a continental scale (if the AU can wake up). Surely, if the whole Africa cannot do it on its own, then it might as well ask for a voluntary re-colonization outsource the governing of its countries. I take a look at how we are now being ripped off by China while we happily cry that "we'll just turn East!". In Kenya, people get all worked up because they saw a bunch of little men building a short "superhighway" (on borrowed money!). Take a look at how much China is getting through selling us junk, and you will realize that whatever they "give" us is just the sort of preliminary investment that one has to make in the process of making a killing. Among the things I find most disturbing is that China is rapidly eroding our wildlife, which, through tourism, is a source of livelihood for many Kenyans. Mank raised some very serious questions that Kenyans should be thinking about, and it is a pity that fimbo derailed it to some mindless jerking-off about "what is bankruptcy".
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Post by jakaswanga on Aug 8, 2013 22:14:48 GMT 3
Jakaswanga and Mank: Anyways ... the fire at JKIA reminds me of a session at which I heard Lee talk; as the only African present, I really wished I'd spent my evening drinking instead: After the Malaysians told him to fwack off, Lee decided that he would have to find partners among African countries in a similar situation, and some time later he toured several African countries. It didn't work. At the session that I speak of, he described a situation in which he was hosted in a presidential mansion. When he went to brush his teeth, the tap gurgled before spitting out an orange-brownsish liquid. He went to the fridge and found a bottle of Fanta to use instead. He described the countries he had visited as "mostly parodies of countries". Have things changed? From first-hand observations of Singapore and South Korea, I would suggest that Kenyans stop dreaming and that GoK gets serious.Why do you think I refer to Uhuruto as toy presidents? That is because I have seriously thought through their economic options, and reached the conclusions they are 'mifuano'. Mimics without the core of the real thing. A toy regime in a parody of a country then. They can not even explain how ksh. 18M was scheduled to hire the Ruto jet!? --see the parliamentary inquiry while the amazing defence was put: Raila and Kalonzo used more! Which is to say: it is our turn to eat, and we are going to eat! With that mentality, there can be no vision at all. Let alone vision 2030! Oh No, fimbo was but a small detour, we will go back to the core ---an evaluation of 'indicators' which can shed light on whether we will abscond from bankruptcy! By the way Otishotish, spare some time to take a look at what happened in Iceland after the bankruptcy caused by their banks! They were not toy-men who brought the country back from the abyss! NB: On the airport fire, I do not know who it was who said: the elite arrived in huge sleek limousines, to watch askaris putting out an inferno with buckets of sewage water! Even colonies are no longer run that badly. In any case our elite evidently has already mentally collapsed.
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fimbo
Junior Member
Posts: 60
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Post by fimbo on Aug 8, 2013 23:22:20 GMT 3
If all you were about to say is that a country does not have to go bankrupt because it can liquidate its "other assets" (in addition to the first lifeline it holds, according to you, of printing and printing), then we really do not have a discussion. In my mind's eye I can now see OtishOtish laughing at me. I would never laugh at anyone; but I would urge you not to be led astray by your new friend, fimbo, and to heed my warning on the dangers of self-pleasure, which, I understand, can cause blindness. Anyways ... these comments on printing just gave me a bright idea: While the government is running the printing press to pay for this and that, it could also eliminate poverty in one fell swoop. All is has to do is print as much money as those who don't have any need and then hand it out. Otishotish, Again you seem to be rushing to the payments without pondering what is being paid for!!!! If the country did not produce anything to "eliminate poverty" (such as food) there would be nothing for the government to "buy" and therefore no way to incur any debt and therefore no need to print. Because food, education etc cannot be printed, you cannot "eliminate poverty in one fell swoop". Pay very close attention, because this is the gist of the discussion: the take home.1. Poor monetary policy would cause a country not to produce anything to "eliminate poverty" because "there is no money" 2. While "there is no money", resources lie idle, unemployment increases, GDP tanks, taxes are not collected, all this leads to a downward spiral and more poverty. All this is nothing new, that is why central bankers have a dual mandate: to ensure full employment (long term growth potential ) AND stable prices.
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fimbo
Junior Member
Posts: 60
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Post by fimbo on Aug 8, 2013 23:41:26 GMT 3
jakaswanga
I agree it possible to go BK, or repudiate debts, if you borrow in a currency other than your own. Argentina did a few years back.
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Post by OtishOtish on Aug 8, 2013 23:58:33 GMT 3
Otishotish, Again you seem to be rushing to the payments without pondering what is being paid for!!!! If the country did not produce anything to "eliminate poverty" (such as food) there would be nothing for the government to "buy" and therefore no way to incur any debt and therefore no need to print. Because food, education etc cannot be printed, you cannot "eliminate poverty in one fell swoop". Pay very close attention, because this is the gist of the discussion: the take home.1. Poor monetary policy would cause a country not to produce anything to "eliminate poverty" because "there is no money" 2. While "there is no money", resources lie idle, unemployment increases, GDP tanks, taxes are not collected, all this leads to a downward spiral and more poverty. All this is nothing new, that is why central bankers have a dual mandate: to ensure full employment (long term growth potential ) AND stable prices. Friend Fimbo! You are definitely a very funny guy! If the government were to print to pay for its debts, as you suggest, what exactly would it be paying for? (Think beyond the obvious "the banks of course!") Without realizing it, you are strangling yourself with your own shoelace. I'll leave it to Mank and Jakaswanga to save you from yourself.
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fimbo
Junior Member
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Post by fimbo on Aug 9, 2013 0:24:53 GMT 3
No, Mr Jakaswanga, if "mineral wealth" was the 'contents of the vaults', then the government needn't even go there to settle local debts. Those are reserved for special debtors, those with the foresight to denominate their loans in foreign currency and they are not you or me.
You see, when you sell your mineral rights, why would you receive payment in your own worthless paper?
Depending on the circumstance, the government can confiscate any [portion of an] asset within arms reach. It is called taxation. And this government has been doing a lot of that.
Please note that when the government is thinking about taxation under this circumstances, its it not concerned about the paper, but the goods and services that it must deliver to the public to assuage them.
The results is that, in the short run, after accounting for transaction costs, wealth is being transferred within the economy.
Please also note that this kind of crisis presents a good opportunity for politicians to grab other assets such as public land (forests) and some parastatals that are not desirable to sell off to foreigners. Therefore I do not expect then to generate much revenue.
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fimbo
Junior Member
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Post by fimbo on Aug 9, 2013 0:51:11 GMT 3
Friend Fimbo! You are definitely a very funny guy! If the government were to print to pay for its debts, as you suggest, what exactly would it be paying for? (Think beyond the obvious "the banks of course!") Without realizing it, you are strangling yourself with your own shoelace. I'll leave it to Mank and Jakaswanga to save you from yourself. I think you have it backwards. Banks have the most to loose from runaway inflation. Repayment on their loans are worth less than the initial disbursement. Why would you maintain a deposit in the bank if your money was loosing value everyday? That is why the ex-bankers (whether from the World Bank, IMF or Barclays) running central banks always default to a tight monetary policy. I think bank bailouts, to which you seem to be referring, are not an issue in our situation.
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Post by OtishOtish on Aug 9, 2013 2:01:11 GMT 3
I think you have it backwards. Banks have the most to loose from runaway inflation. Repayment on their loans are worth less than the initial disbursement. Why would you maintain a deposit in the bank if your money was loosing value everyday? That is why the ex-bankers (whether from the World Bank, IMF or Barclays) running central banks always default to a tight monetary policy. I think bank bailouts, to which you seem to be referring, are not an issue in our situation. Quote: "Think beyond the obvious".Also, I thought we left the banks with this unanswered question: "For example, what would the effect be on banks and how would that effect migrate into the rest of the economy?".Read more: jukwaa.proboards.com/thread/8589/country-kenya-bankrupt?page=3#ixzz2bQb8ZSln
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Post by mank on Aug 9, 2013 2:47:00 GMT 3
Friend Fimbo! You are definitely a very funny guy! If the government were to print to pay for its debts, as you suggest, what exactly would it be paying for? (Think beyond the obvious "the banks of course!") Without realizing it, you are strangling yourself with your own shoelace. I'll leave it to Mank and Jakaswanga to save you from yourself. OtishOtish, I have a flu that's doing me all the abuse Fimbo seems bent on doing. So I will let him be. This thread will look beyond the Idi Amin Print Press Economics that our friend Fimbo unrepentantly reintroduces.
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Post by mank on Aug 9, 2013 3:01:30 GMT 3
No, Mr Jakaswanga, if "mineral wealth" was the 'contents of the vaults', then the government needn't even go there to settle local debts. Those are reserved for special debtors, those with the foresight to denominate their loans in foreign currency and they are not you or me. He just rejected the lifeline! Why is it foresight for a lender to denominate loans in foreign currency if the country is creating wealth by printing its own currency?
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fimbo
Junior Member
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Post by fimbo on Aug 9, 2013 6:25:51 GMT 3
I think you have it backwards. Banks have the most to loose from runaway inflation. Repayment on their loans are worth less than the initial disbursement. Why would you maintain a deposit in the bank if your money was loosing value everyday? That is why the ex-bankers (whether from the World Bank, IMF or Barclays) running central banks always default to a tight monetary policy. I think bank bailouts, to which you seem to be referring, are not an issue in our situation. Quote: "Think beyond the obvious".Also, I thought we left the banks with this unanswered question: "For example, what would the effect be on banks and how would that effect migrate into the rest of the economy?".Read more: jukwaa.proboards.com/thread/8589/country-kenya-bankrupt?page=3#ixzz2bQb8ZSlnOtishotish, Let me be clear, if the government prints, say to pays teachers, the beneficiaries are the students who get an education, and their parents, and the teachers themselves. If it is to pay nurses/doctors, sick patients are the beneficiary etc etc. The discussion about the impact on banks is a side show and a distraction. But if you must, if inflation expectations become entrenched, banks will see a relative decrease in their deposits (this is the liability side). On the asset side (lending side), banks will be forced to raise interest rate to compensate for the inflation risk. Higher interest rates, all things being equal, will increase the default rate as borrowers, having lower a upside, resort to ex-post moral hazard. see en.wikipedia.org/wiki/Moral_hazard.
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fimbo
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Post by fimbo on Aug 9, 2013 6:43:23 GMT 3
No, Mr Jakaswanga, if "mineral wealth" was the 'contents of the vaults', then the government needn't even go there to settle local debts. Those are reserved for special debtors, those with the foresight to denominate their loans in foreign currency and they are not you or me. He just rejected the lifeline! Why is it foresight for a lender to denominate loans in foreign currency if the country is creating wealth by printing its own currency? Mank, A country is creating wealth by printing its own currency? Not sure where you got that from, not from me, I hope!!! Depending on circumstances, such as: 1. For sectors of the economy controlled/dominated by the government. 2. For sectors of the economy where credit markets are not working, i.e funds don't move from savings to borrowing households. The government may provide liquidity or funds directly. Not sure whether this is wealth creation, but absent this liquidity, resources will be idled and capacity will not be utilized. As to the foresight of the lender to insure himself against exchange rate risk, inflation risk etc by borrowing in a "safe" currency (at all times), requires no elaboration from me.
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Post by mank on Aug 9, 2013 16:02:50 GMT 3
He just rejected the lifeline! Why is it foresight for a lender to denominate loans in foreign currency if the country is creating wealth by printing its own currency? Mank, A country is creating wealth by printing its own currency? Not sure where you got that from, not from me, I hope!!! Depending on circumstances, such as: 1. For sectors of the economy controlled/dominated by the government. 2. For sectors of the economy where credit markets are not working, i.e funds don't move from savings to borrowing households. The government may provide liquidity or funds directly. Not sure whether this is wealth creation, but absent this liquidity, resources will be idled and capacity will not be utilized. As to the foresight of the lender to insure himself against exchange rate risk, inflation risk etc by borrowing in a "safe" currency (at all times), requires no elaboration from me. Fimbo, You stumble into arguments like a drank in brownian motion. That must be what OtishOtish finds to be funny about you. If you think you have been misunderstood you could step back and summarize your arguments in one coherent posting. But disowning arguments you have made while you throw in other random ones is not a means to being understood.
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Post by mank on Aug 18, 2013 22:03:37 GMT 3
MANK WROTEThis thread is a nuclear reactor melt-down, only you do not know it yet! Because in the end, Mank, we will have to discuss contingency measures in the event of an actual bankruptcy of the Kenyan State! ---God forbiD it escalate that far! but back to the basic punch-line of this thread ---as I quoted above: Let us first agree then, in the main, to find the above explanation sufficient to explain the demise of Detroit. I can then add to substantiate the declining tax-base thus, that, while all these [factors you mentioned] happened, one crucial factor stayed the same, Detroit did not 'invent' a new industry to replace the old and aging --them gradually becoming obsolete as technology revolutionised production elsewhere. She remained a golden town even as the goldmine depleted and would-be miners moved further afield to search elsewhere. She was no longer competitive industrially or in whatever else she used to to for upkeep. ---But continued to offer competitive retirement (rofl)schemes, and competitive salaries to bareaucraties running a dying world. So, let us ask, in which ways Kenya could be duplicating Detroit as an economic entity? and in which ways are we buffered from those misfortunes, either because we are smarter, or merely because though we are an economic entity too, we are different in that crucial aspect of being a state, capable of ---see Fimbo-- 'Delaruering' our way out of any mess! Comparing these two ''balance sheets'' then, we can reach a temporary truce with Rotich and his treasury! May be we can then prove Kenya can not go bankrupt, and we go to sleep in peace. Trusting in the printing press! 1. How competitive are the retirement benefits the 10th Parliament Mpigs voted for themselves? ---And Moi, Kibaki, Raila Kalonzo send off packages? Are they Detroitian? 2. How expansive is the Kenyan tax-base ... with statistics like 40% youth unemployment? Prospects of expansion? 3. How large is our public sector wage bill, in comparison to the actual work-done, and efficiency rate of our economy? 4. How much revenue do we waste --eg by corruption? white-elephant projects? 5. What % of our budget do we spend on R&D, to develop new solutions for old problems? or train new skills to do the same? 6. What natural resources do we have which we can mortgage to get some credit life-line to limp on? 7. etc etc Detroit can of course dissappear from history and become a ruin like Carthago or some other such abandoned city like the famous ones of the Aztecs in Latin America, overrun by jungle nowadays. But Kenya, or countries, has no such option of total population displacement. Civil war may be a more realistic option of rebirth, as the bankruptcy is explained simpy by the incompetence of ONE PARTICULAR CLASS IN CAPTAINCY. A change in captaincy, may just be the wonder drug! NB: Amigo, I think we should move to look at the debt portfolio of Kenya now. How much we owe [both ways] both private borrowers and the state, and to whom do we owe which interest rates, and at what would be penalties of default? Well, Our Fimbo here says no worries about the domestic creditors! Kiboko yao ni Delarouex NB2: In the last years of the stuporic presidency of Boris Yeltsin, the Russian state was still fulfilling her obligations to the locals. Paying things like salaries and retirement allowances which the old people had worked for all their lives. Problem was this: The prices in the general economy had become market rates, but the state scale of remunerations was still soviet.Say 300 roubles had been, Under Gorbachov and before Yegor Gaidar's shock therapy, more than a reasonable monthly retirement allowance for an ex-colonel of the red army who had fought his way from the Urals to Berlin. Now, the state still paid that 300 'uncorrected' roubles, but the apartment had been privatised and the rent was now 3000 roubles per month, market conforming! For 300 roubles, one got half a loaf of bread. Theoritically then, the state was meeting her obligations locally. In practice, this was a silly joke, and the red army had to prevent private speculators who had bought these apartments by loans granted by banks catering for the pension funds of these tenants, from evicting them out of their abodes.The Oligarchs had not only hijacked the life-savings of these people, but they were using those savings to buy the properties of those people on the cheap, and iflating their prices, then using the new law to evict them. That was the invicible hand of the market, Adam Smith upside down! This was the economic mess that brought forward Vladimir Putin, soon to be supreme dictator of Russia! Yes, no state can run out of money to pay her local debts/obligations, but a state can run of of making economic sense, and essentially must then perish. For nature hates a vacuum, and a vacuum regime, does must go! Always. Brother Jakaswanga, I started with what is readily available: data of foreign vs domestic borrowing. I hope the attachment will show up somewhere in this posting. It will be interesting to see how these trends correlate with those of GDP and GDP per capital. Attachments:Kenya Debts.pdf (139.66 KB)
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