Monday, September 26, 2011
REBUTTING BILL LINDO´s OPINION OF THE WORLD ECONOMY in Belize
I like reading Bill Lindo´s piece in the Amandala.
Bill, the fears you express, the doom and gloom of world economic collapse, the EU troubles, are all interesting stuff. Unfortunately, in my opinion you are 2.5 years too late. It already happened, while you were sleeping! It´s over! Now we are in the re-adjustment phase, which will probably run 3 to 5 years until 2016, before the next big BULL MARKET.
If you want to understand what is happening in the world economy, take a look at the DOW records going back a 150 years or more. I´m sure you can find someplace on the internet, the record of every Depression, recession, civil war, the Crimean War, World War 1, World War 2, the Bolshevik Revolution, the Vietnam War, Cambodia, etc. All these by year and over graphed on the DOW, or stock market record of world economic activity, by the WORLD, or even by individual countries. It is an eye opener.
Capitalism as an economic system is ruthless. It is the duty of politicians through taxes to re-distribute the money taken from capitalists, to the needy poor. Capitalism itself is a money orientated industry, which is measured by your profit in hand, usually at the end of the year. You need a measuring stick and money is that stick. The ability to distribute wealth is left to the responsibility of politicians, through tax distribution. The UDP maximum leader says he is doing that.
In my view, the WORST is already over. There is still going to be a lot blood in the streets, until the next boom cycle gets started. Capitalism is a self correcting system. An entrepreneur identifies a NEED, a DEMAND and then builds a business to fill that need. When that need is done, whether by competition, or overproduction bigger than the demand, or changing technology, then corporations die. Something else takes the place.
Unfortunately in a world of changing technologies, the death of corporations is happening at a faster rate. People no longer can commit themselves to working as an employed person, hoping for that UNION PENSION at age 65. Most corporations have to compete and employees that reach 50 are soon dumped, because of age, cost cut studies, or changing technology.
Lets talk about this as it effects SMALL BELIZE. Belize weathered the past depression very well, compared to many EU countries, or even the USA. Part of this was Said Musa´s 5 year austerity, which cost his party the election. Part of it is because DEAN BARROW has been concentrating on infra-structure. There is nothing immoral about capitalism. It is what it is, nothing more, nor anything less. It is SUPPLY and DEMAND at work. What is happening now is the possibility of a double dip recession. This will not be the end of the USA, nor of Belize. The world wants everything we can produce. The population of the world keeps growing. As long as this is so, the opportunities for Belize are endless. WE CAN COMPETE in niche markets. I have markets lined up right now for chocolate candy exported from Belize, also for hammocks. My entrepreneurial problems are the cost of importing the materials I need to do so. The inconvenience of dealing with the customs and brokers to do it. Personally, I have a Financial Business going and it is just taking off, after two years of trial and error learning. I have to decide where to put my energies, as my goal is to stay small. My needs are minimal. To each his own goals.
There is a point to this. SELF SUFFICIENCY is the goal for Belizeans. Not only at the NATIONAL LEVEL, but at the worker bee level. It is a FOOLISH Belizean that expects to work at the same job for 30 to 50 years and retire on a pension. The world is not like that any more. Maybe once at the end of the 1800´s. Not now though. The employee aspirant needs to use a job, a salary to acquire his business and skills to run that business. A young person needs time to learn hard business lessons in the cruel market place. Trial and error is the name of the education system. You use a job and salary to provide the bread and butter cash flow, to build your idea of your own business. Once you learn the lessons the hard way, you can repeat business building, over and over again, changing with the SUPPLY AND DEMAND aspects of capitalism.
The global system will not collapse. It already has done so. What we have is a changing set of dynamics on the world scene. China and the USA are competing for the biggest world economy. Russia will always be second rate, because of it´s political system of KGB rule and corruption along with being a basic raw commodity exporter. India can be big, but will always be second rate. Because it is so corrupt. The EU will probably stay together, as it is a function of prevention of war, with which they have much experience and because of economies of size for their markets. You find EU countries with chain stores ALL THROUGH LATIN AMERICA today. They own huge tracts of land in South America growing food. GREECE will always be a problem. The EU is basically just industrialized FRANCE and GERMANY carrying the load.
Belize is tied to the USA dollar, and it doesn´t matter if the dollar goes up or down. Our biggest trading partner is the USA. Most of the Chinese produced goods we import come through the USA, because the US market can order large quantities at discounts we cannot in Belize.
Belize right now has an economy, built on several legs. There is oil, lobster and fish, sugar, bananas, citrus, other agriculture products and the newest leg that has developed magnificently over the past year is GRANT supported infra-structure growth. Meaning, all our tax revenues go to pay for debt, government, politicians, and such things. GRANTS are paying for ALL OUR INFRA-STRUCTURE if you read the newspaper announcements over the past year. If anything, we need to expand this leg of our economy done by the GRANT WRITING DEPARTMENT. This has become a mainstay of our GDP growth, expected to top out over 3% by end of calendar year.
If anything, education changes are the basic need. We need community colleges that teach how to build things with lathes and other small scale industrial machinery. The internet has opened up markets for us in Belize in so many world fields it is surprising youngsters are not doing more. I can see why, when Dean Barrow recently said only 14% of households even have the internet. That is definitely a drawback. Nope! Things are going to be slow growth for a few years more, but in five years I look for boom times in Belize, if we can lick the problems of the internet revolution, electricity and educational changes in practical teaching. Getting away from this cheaper academic orientated stuff, producing salaried civil servants.
Posted by A Professional BEACH BUM retires in Belize! at 10:23 AM