Tuesday, November 30, 2010

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Usual Suspects.

last Friday afternoon, I heard a commentator on a public radio station saying that a differential of 2.5 percentage points on English debt the German "scary." I was afraid to hear, and most of the comments that followed, including not only politicians and experts, but a European commissioner and someone from the employers' confederation, among others.

should distinguish the following about the debt. First, it is appropriate to compare with the German debt, because their rates are artificially low, considering a very liquid market and a refuge, it would be fairer comparison with a country like Italy. A year ago the ten-year bond was in Germany to 3.40% and 4% in English, German debt today this term is 2.4% and 5.4% English. The increase is due to the double differential effect indicated that while the other goes low. In addition, increases in absolute terms they are still reduced because we are historically low rates, and the ups and downs just adjusting in less than one percentage point. I would not buy German and U.S. debt, I think there's a bubble in them, because interest rates 2.65% and 2.80%, respectively, for ten years, did not respond to any fundamental criterion in these countries. Rates between 5% and 6% are the most reasonable in Europe.

Second, Germany is the great beneficiary of the euro, allowing you to expand its industrial production in an area protected from the vagaries of the coins. If you continue to enjoy their situation has to bear the consequences of the debt of countries in the area the euro, issued largely to finance the growth and absorption of immigrants in the area. Third, Germany has more debt than Spain, but less private, business and banks borrow to produce and invest, or speculative activities as have been the acquisition of other companies, now have to pay the consequences of inadequate investment and further forward. Fourth, the public and private debt are now closely linked, in Ireland the State wished to come to the rescue of the banks exceeded the national economy, and the attack on the public debt is an attack on banks and firms, especially in the bags. The meeting with English Prime Minister large companies seeking a common strategy makes sense, since they are listed who suffer the vicissitudes of the market.

Fifth, when it comes to reassure the markets know that these are naturally neurotic, bullish or bearish, with moments hysterical. Volatility is what gives good benefits, not calm. After Asia and Europe will then North America (not sure if that order). Markets have the power to limit excesses and correct errors require public and private, but if there is no strong responses from governments and central banks will impose the kind of dictatorship where everyone is suspicious of something, and in which, by reciprocity, also considered suspect in the markets. Gumersindo
Ruiz.
(Grupo Joly 11/30/2010)

Thursday, November 25, 2010

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Tuesday, November 23, 2010

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realities and illusions.

THE problem of Ireland is a more recent history of excesses, in this case of banks that grow well in excess of the gross national product, are financed externally and real estate and financial investments made unwise, within and outside the country. In the years preceding the crisis that is applauded for stimulating productive activity and creating employment, but when the value of these investments falls on bank balance sheets and lost the confidence of retail and wholesale customers, the problems begin.

The Government acted decisively, guaranteed deposits and set up a bank, the Nama, who took charge of impaired real estate assets. Allied Irish Banks like Bank of Ireland or are partially nationalized and others such as Anglo Irish, are having removed some of its bondholders for almost 80%. No action was wrong, but the crisis is teaching us that sometimes it's not a question of wanting but of power, and here the banks are too big for such a small country has to accept, finally, external public funding. When missing deposits and financing banks use the ECB, but it does not take much responsibility indefinitely. Bank debt affects the Irish public debt, and creates tensions in the European Union and the euro itself, but the EU has a fund of 750,000 million euros are still unused and the Central Bank's resources are in emergency, virtually unlimited. England and Sweden will also contribute because it affects them. There is no shame for a country to resort to financing from its partners, to be returned.

Ireland has a corporate tax of 12.5%, with which he has been able to attract investments that were unimaginable a few years ago. Hence the reluctance of the Government to accept funding comes with requirements to raise taxes to clean up public finances. I sympathize with that rate so low that it helps create business and employment, but it is clear that the disorderly growth of investment and financing, as happened with the residential and nonresidential construction has caused a serious problem for the system, now should be paid.

original is not the case in Ireland remember the classic play Synge: The Playboy of the West, where Christy, the protagonist becomes a hero by the need to delude people with something really out of his secular peasant Christy himself, before its ultimate failure, acquires sufficient stature to win between them. Synge, in the preface, says: "In Ireland, for years the popular imagination is bold, beautiful and tender, so the writers have something to do not have the spontaneity that live where local life has been forgotten, harvesting is only one memory, and the straw has become a brick. " It remains an irony that one hundred years after problems come not from modernity, as the country has a good industry innovation, high technology, but finance and real estate adventures. Gumersindo
Ruiz.
(Grupo Joly 23/11/2010)

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The barbarous relic.

The price of gold rose nearly 25% in 2009 and 30% in 2010 on already high levels. The reference price of gold is always in dollars, but if we see in different currencies, and on the base 100 in 1970, would have risen at a rate up to 1,000 yen, 4,000 dollars, 4,500 euros, and 5,700 in British pounds . After more expensive in the 80's, remains fairly stable for twenty years, which leads to the disproportionate rise in value over the past five years.

World Bank President Robert Zoellick has suggested the possibility of reforming the exchange rate system, removing and replacing the dollar ownership of a basket of currencies (including the Chinese yuan), which act as currency in international transactions. This will stand to gain in stability and avoid speculation as there are now against the debt of Greece, Ireland, Portugal, Spain and Italy to attack the euro. Moreover, and here is new, that basket of currencies, which would work in practice as a major international currency would refer to gold, with the role of limiting the amount of money that can be emitted in the world. Gold would also be used as a reference for each currency and movements between them, that is, say if the exchange rates at all times have a reasonable basis.

However, gold may again play a role reference in the international monetary system. In 1971 the dollar no longer convertible into gold, which had limited the creation of money and financial bubbles, for every dollar issued had to have a corresponding amount of gold, then an ounce of gold was worth $ 35, and now 1,400. But the global economy grows and the supply of gold is stable and therefore can not be a reference to money growth. Moreover, gold is an asset class and its value depends on the speculation of those who, for various reasons, choose to have or not their investments and savings in gold. In times of inflation serves to protect against the loss of purchasing power, an erratic stock market, of a housing bubble, international conflicts, and now subject to currency speculation. It is a refuge in uncertainty, it is not known where to invest.

was Keynes who called gold "the barbarous relic", and today we consider it more relic in relation to the problems of the international economy, and more barbaric for the reasons underlying their hoarding. On the contrary, the proposal to use a group of hard currency is viable, but must be accompanied by a balance between what countries are buying and selling, and investment flows. This is the real challenge that will force us to rethink the relations between China and the U.S. and within the EU, so that the internal job growth and more balanced and responsive euro to a more homogeneous. If this occurs it would make more sense to keep investing in different assets in hard currency and give, little by little gold. Gumersindo

Ruiz.

(Grupo Joly 15/11/2010)

Friday, November 19, 2010

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Thursday, November 11, 2010

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Wednesday, November 10, 2010

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Cultural cities.

Some cities are striving to achieve a degree of cultural capital as a form of promotion and conveniently positioned in the global economy. But sometimes, as in many things, people and circumstances are the ones who get a point and city stand out from others. Already in the ninth century prided Compostela to hold the remains of St. James the Great, but the city gets its momentum in an exact date: the year 1100, when he was appointed Bishop Diego Gelmírez, who manages, with remarkable tenacity and dedication, which is Compostela, along with Jerusalem and Rome, a city of pilgrimage.

is obvious that the figure of Santiago had no religious significance to the Holy Sepulchre in Jerusalem or the remains of St. Peter in Rome, the first required a dangerous journey, but allowed to live where religion was conceived, and Rome , besides being the center of religious politics, had a rich culture and unique monumental. Gelmírez going to Rome two Sometimes, on a difficult journey through northern Spain, where he was banished Aragon avoiding the former Bishop of Compostela, Diego Pelaez, across France, and Italy. Previously he had been in Portugal, in Braga, which also spurred the construction of a church of pilgrimage, contains relics of saints, with the excuse that they were subject to care and due worship, and takes them to Compostela, reinforcing their arguments to make the archiepiscopal city. Twenty years later he was granted this distinction, and between 1100 and 1140 constructed the temple not only more meaningful and functional for long-distance pilgrimages, but gives way to a destination with unique significance.

Compostela and the Way of Santiago have been interpreted from a religious, cultural, architectural and artistic philosophy of life, linking European countries, and economic. Some approaches are questionable, as if the roads were European arteries default or spontaneous movement of pilgrims, the influence of other cities, or trade between workshops and artisans. But discussions are irrelevant compared to the results, as is trying to reduce what he has to do with Compostela and the Way to costs or economic data. As

trip, the pilgrimage is marked, even today, by the austerity and rigor as opposed to other aspects of modern life. The purpose is something intangible, has an international reference with a local base and features very meanings and rituals, a strong cultural component, which calls for very different audiences, and a brand that makes it unique and original. Gelmírez promoted infrastructure, water, hospitals, grammar schools, palaces, and the works of the cathedral services were emerging and diversified to meet the needs of travelers throughout the centuries. This man, "affectionate, creative and humorous," taught an idea, hard work and effort, believe in what you do, and some luck, can yield results that range for centuries, and last longer than an ephemeral cultural capital. Gumersindo
Ruiz.
(Grupo Joly 11/09/2010)

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time anxiety.

LOS countries called the group of twenty, G20, reúnenesta week in South Korea in an atmosphere heated by global economic imbalances. Since fighting is not between rich and poor but between those who have trade surpluses that they sell more they buy, and those who consume more than produce and show a deficit. The first, also are savers and accumulate huge foreign reserves, currently, one third of the world's creditor, a third debtor and the remainder maintain balanced trade position.

growth emerging economies generates less employment, as companies have been adjusted by the crisis staff and try to keep as reducing production costs. Therefore, they draw to depreciate their currencies to sell more cheaply and create employment. What is called "new normal" response to a situation in emerging economies like China, Brazil, India, Russia and Turkey seem to be poised to play a key role in world affairs by the weight gained after the crisis, global economy.

But the rebalancing of international trade is only the manifestation substantive issues currently affecting almost all nations. Not just about trade talks between China and the United States, or concern for the exchange rate in Korea or Brazil, but the imbalances and conflicts that have internally and countries that emerge in these meetings.

The list of problems faced by states has been extended, have assumed responsibilities that respond to new challenges, because of the way of economic growth. Have created expectations in people that can not be met, at least all at once: to grow and create jobs with fair play in markets increasingly difficult, maintaining the gains of the welfare state known as working conditions, pensions, health and education, addressing a consumer needs to be continually expanded to incorporate a virtually unlimited range of goods and services that are available, are offered, and we all want. In addition, there are concerns about how growth, environmental damage, weather disasters, depletion of raw materials, water, immigration, the population of Portugal and the deteriorating quality of urban life, terrorism and organized crime. And the perceived threat-real or imagined-of the new economic powers often ignore their responsibilities and do not respect basic civil rights, dictatorial regimes or clothed by strategic interests, trade or access to raw materials, as with China in relation to some African countries or with its neighbors North Korea and Burma.

In a situation of uncertainty, people do not forgive, and in democracies in the elections to punish their leaders for the consequences of a crisis that developed under previous governments, but also have confidence that those who replace their expectations will be covered .

have questioned the legitimacy of the G20 to make decisions that affect humanity. In this sense the representation could be improved by maintaining a small but expanding it into three or four countries, with criteria such as the weight in the population and the global economy and establish a regional representative for not leaving out parts of the world as the Nordic countries or large parts of Africa. It is true that the G20 has no executive capacity, but moral persuasion is a sign of unity among countries facing a serious crisis.

is important for nations to meet, talk and reach agreements on issues such as greater discipline to the financial system and avoid greater evils in the trade. This I have been advocating since the first meeting of which will be two years in November.

Now is the Age of Anxiety is the title of a long poem by WH Auden, which won the Pulitzer Prize in 1948, written between 1944 and 1947, reflects the moral impoverishment of the time and the lack of response from leaders to avoid collective folly and catastrophe. As is to tell the writer Catherine Bucknell, an economic crisis does not have as crudely as a war so bad in human nature, at least on an epic scale, but it generates anxieties, if not remedied, lead to fears and larger, false reasoning and injustice. Gumersindo
Ruiz.
(Grupo Joly 09/11/2010)

Thursday, November 4, 2010

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Tuesday, November 2, 2010

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Preparing the future. Paradoxes

RESULTS essential to refer to the Forum of Tourism in the Mediterranean, Meditour, which held its fourth edition in Manchester a few weeks ago, as few events take place on this scale and of such importance to Spain. In the present circumstances the tourism, agriculture and some industrial exports, render the situation, though difficult, is not desperate for this reason we articulate some ideas about Meditour.

The first is the variety of issues that arise around a modern tourism, technologically advanced and open to innovation. There was talk of issues such as sustainable tourism in a fragile area of view as is the Mediterranean climate, and how to balance energy consumption, the impact of agglomeration and transportation, with the development of the activity. Other issues included: strengthening the brand of the Mediterranean to the promotion of tourism, since the area receives 30% of international tourists and is a major destination for world tourism linkages with financial sector capable of creating investment tools to the sector, innovation in tourism products, expand the industry best practices and corporate social responsibility in multinational companies are given, and last but perhaps most importantly, the role of our capital human as an asset and competitive advantage in tourism.

The second idea arises from the Forum is willing to anticipate the changes that occur in the world. We are faced with situations of uncertainty that predictions made with data break from the past, but we can think of reasonable scenarios. Despite all our problems, what would today's economy if we did not Andalucía this infrastructure of ports, airports, roads, railways, hotels, restaurants and golf courses? Now is the time to prepare for the future with new projects that maintain and enhance this industry and see how it connects to other industries and construction. The third idea is institutional. Meditour is an initiative of the Chamber of Commerce of Malaga, who chairs the tourism committee of the Association of Chambers of the Mediterranean and the Mediterranean Centre for Innovation in Tourism, along with other entities. It is imperative that all institutions are aware of the importance of the Forum and to work without hesitation, actively, in the same, this is a responsibility that can not be avoided.
died a few weeks ago Vladimir Raitz, pioneer and inventor, through Horizon Holidays, mass tourism and package holidays for British tourists, a concept introduced in 1949. This form of travel, collectively and low budget, was widely criticized as an exponent of mass-consumption and has an air of vulgarity, but it is undoubtedly a political force, social and economic that could not be ignored. His memoirs, collected in flight toward the sun, are recommended for anyone interested in the sector, but mainly because we have an image of innovative entrepreneur anticipates and creates the future.