Are things getting better here?

[chola1978]

aS A SMALL-MID SIZE BUSINESS OWNER IN SANTIAGO HERE IS MY STATEMENT.
I have been in business in a Barrio in Santiago for 5 month now. My earnings are not tide to the Dominican Republic economic stability since I represent American based firms in the States. Now in regards to my employees. I have generated 25 new jobs all above minimum wage in a neighborhood that had lost hundreds of jobs due to the recent Zona franca issue. So is you see the income comparison 25 new jobs (400,000) income versus 100 jobs(400,000) no change in their but the change I see is for those that where working for 4-6k per month that now earn twice that working for me. Also other new business have open in this neighborhood since I open in early February. As I stated before things are doing great for some and bad for other, I general we are moving in a progressive society. We still have a huge class gap. Middle class is an endanger specie here. Most people in Barrios Always complain that things are bad....................pero siempre hay que comer........ In Santiago Tipico Montebar is always full in the weekends and a new bar just open to make competition. So Is hard for all those out since looking in to measure the reality of things. We are now force to pay taxes that we did not before this gives local and central government and increase in income , so they are doing well i n that part. Some of my colleagues adopt to close their business to avoid the taxes... I said this are a bit better in some industries and in general thing needed to stabilize a bit.................
lol E Pa'lante que vamos........some times pa tras.

 

[Mirador]

Mirador, it is very common for enterprises that have fluctuations in revenue to have lines of credit. It's like "cash flow insurance". It is especially common for this to happen with fast-growth companies.

And how do several banks open up "a" line of credit for several hundred corporations?

Are you saying these banks don't see the "big looming crisis", but you do?

The situation where local banks have colluded and opened special lines of credit for the 100 or so largest DR corporations, including Casa de Campo, in order to pay for their June payroll, is a speculative maneuver to force the devaluation of the DR pesos vis-a-vis the US dollar. It this truly happened, as was reported by reputable bloggers, then we may see an exchange rate hovering around 40 pesos per US dollar before December of this year.

 

[chola1978]

In regards to lines of credit and the local banking industry. among banking professional that I associate with it is said that currently the banking industry is having a surplus of saving account and are in need of creating new lines of credit to keep funds active. With new lower rate to increase revenues this is an action that is being push by the central bank. I do not know if this an indicator of how good or bad we are doing i just know that banks now have more moeny to lend out and at a cheaper rate.

 

[Mirador]

DR corporations borrowing from the local banking system instead of using their own financial resources? Do you hear loud inflationary bells ringing in the not too distant future? If this is the Central Bank's doing, then it sounds like a desperate effort to jump-start a stalled economy.

 

[cobraboy]

DR corporations borrowing from the local banking system instead of using their own financial resources?

You've obviously never been in business.

This happens ALL the time, using "OPM"-Other Peoples Money. There is a point where ROI is higher on OPM with interest than it is with their own resources, especially during growth. Often borrowing lowers the need to dilute shareholders individual equity by not adding additional shareholder capital.

If what Albin says is true, then it makes total sense. If money is cheap and available, I'd do it, too.

 

[Mirador]

You've obviously never been in business.

This happens ALL the time, using "OPM"-Other Peoples Money. There is a point where ROI is higher on OPM with interest than it is with their own resources, especially during growth. Often borrowing lowers the need to dilute shareholders individual equity by not adding additional shareholder capital.

If what Albin says is true, then it makes total sense. If money is cheap and available, I'd do it, too.

I understand how this situation is advantageous from the perspective of an individual business. However, my reference is to the economy as a whole. This situation is adding to the overall money supply, and according to economic theory, without a corresponding increase in production, inflationary pressures on prices will occur. We are already experiencing that.

 

[slrguy]

Just a little note about corporate borrowing.

I grew in the town where Reynolds Tobacco company is headquartered. If you aren't familiar with the cigarette business, it is the closest thing you can get to minting money, legally.

One of my best friends was for years the guy who borrowed their payroll money every two weeks, to pay the factory workers. When he first told me this, I was concerned about the health of the company. He just laughed, and explained that it was cheaper to borrow payroll short term, than to redeploy assets for this.

So corporate borrowing for these sorts of things is NOT a bad economic sign -only a smart move by companies that are big enough to use assets for other, more profitable things than paying workers every two weeks.

 

[chola1978]

Inflation needs to be control in certain areas of our local economies and that isn not due to a simple supply and demand economic theories we are just. In this country we are still missing lots of checks and balance that ensure that inflation will not be a business strategy to increase income but a reaction ot increase in cost of living. I am not an economist nor am a with no knowledge but i can said that uti9lzing low cost monies to expand production and to secure jobs is better than closing your doors and not being able to complete. I n the states the SBA helps small business with planing, loans, recruitment and a lot of other services. Here banks are offering similar services to increase loan notes and to ensure that their notes have a higher change of repayment. if that not progress what is?
Please don't give me big theories about inflation that a simple colmado owner will not understand. Your statements are true but we need to look at this model of economy and grade our progress by industries and sectors and the we will see how we are doing.
SO my questions again, today are we in a better situation than 15 years, 10year, 5 years ago? Since we are looking for growth patterns are we improving as a country, Is out economy strongrer. is this country a good place to invest today versus in the past. Those are my questions.

 

[aegap]

In regards to lines of credit and the local banking industry. among banking professional that I associate with it is said that currently the banking industry is having a surplus of saving account and are in need of creating new lines of credit to keep funds active. With new lower rate to increase revenues this is an action that is being push by the central bank. I do not know if this an indicator of how good or bad we are doing i just know that banks now have more moeny to lend out and at a cheaper rate.

This is great news! During the Hippo year it was totally the opposite.

 

[rubio_higuey]

The situation where local banks have colluded and opened special lines of credit for the 100 or so largest DR corporations, including Casa de Campo, in order to pay for their June payroll, is a speculative maneuver to force the devaluation of the DR pesos vis-a-vis the US dollar. It this truly happened, as was reported by reputable bloggers, then we may see an exchange rate hovering around 40 pesos per US dollar before December of this year.

Can you please provide some references for further reading, please?
Thank you.

 

[Criss Colon]

"Things Are Getting "BETTER" In The DR!"..Did I Miss THAT MEMO??????

I have lived here for 12 years. I have a household that includes my wife,4 kids,my "Parents-In-Law",a maid,and a daytime " Dominican Handyman"(OXIMORON???):cheeky:
As far as I am concerned,"THINGS" are getting,"MUCH MORE EXPENSIVE",at least,and "Worse",at worst!
Many who are posting their opinions about "Things" in the DR,actually live outside the DR!!!( Why does the name "NALS" keep appearing on THAT list??? )Many others who post "Positive" opinions about "Things" in the DR,are "single",or a "couple",and don't have to pay for,or provide for, such as education,healthcare,food,and other "goods & services" that a "Family" needs to survive!
Just as the price of a "Bien Fria" has no effect on me or my family,except for my father-in-law who is a ,for lack of a better word, a drunk! The price of "Books/tuition/uniforms,and the other "incidentals" that children need to go to school,don't effect them!
The "Market Basket" to them means: that plastic "thing" you carry when buying a few snacks at the "Tiger Mart"!
Before you paint that "Rosy Picture" of "Things" in the DR,send me some $$$$$$$$$$$$$$$$$$$$$$$$$$ to help me pay for our "Seguro Medico"!
"Cause" it looks like it might be a "while" yet before the Government will be funding "Seguro Social" to help with THAT! Guess the "METRO" is just a better "Cash Cow" for them to "milk" for a while! Who knows,once the Metro fails,they may want to "suck" on the "Health Care Tit" !
Cris Colon

 

[chola1978]

Cris it seam that your family represent hwat atypicla extended house hold would look like? We have somthing similar but I cna said is cheaper ro more epxensive here thna i nthe states is yo uconsider that my daughter would be atending a privade christina schools in NYC or Phoenix versus a private one here. As far as books yeah does will hit you hard.............. Per el restos it seems for me that we are better fo here with the smae income thatn in the states . we get more for our dollar here .with the extections on iported products for our grocery list. In my family we try to budget our self 0 frias for the msot part.no hay cuarto for that. I cna blame the local goverment that I dont have extra cash for beer ni que la escuela privads son caras ni que los libros cuetan mucho..the private sector should not be sustain by central goverment. Now in regards to helth care .........bueno compadre I dont know what numbers your are looking at but my health care here is way cheaper thna in the states by far.......... wife, maid, grand mother , 2year baby, mother and my self all with ARS Humano and do exceed 150usd per month try getting that in Arizona.

 

[Funnyyale26]

Cris...seriously if you are soo unhappy in the RD, why are you here? I am not trying to be rude...I just want to understand the reason why anyone would stay in a country that is facing so many problems right now...

 

[cobraboy]

I understand how this situation is advantageous from the perspective of an individual business. However, my reference is to the economy as a whole. This situation is adding to the overall money supply, and according to economic theory, without a corresponding increase in production, inflationary pressures on prices will occur. We are already experiencing that.

Can you show there is no corresponding increase in production?

If the banks are flush with cash on which they are paying interest, what are they supposed to do with it besides find methods of lending?

That is what a bank does.

 

[Mirador]

Love it, or leave it...

Cris...seriously if you are soo unhappy in the RD, why are you here? I am not trying to be rude...I just want to understand the reason why anyone would stay in a country that is facing so many problems right now...

Like the old Spanish proverb...

Estas son lentejas, si quieres, las comes, y si no, las dejas​

 

[Criss Colon]

I Came or The "LENTEJAS", I Stay For the ....

"CHICAS"!
A 60 year old,ugly,fat guy would not be able to "afford" to "DATE" beautiful,sexy,young, ladies in the USA!
:cheeky::cheeky::cheeky::cheeky::cheeky:
Cris Colon,.................."Bad To The BONE!!!"

 

[drgolfer]

Please do not think for a second things are getting better in the DR. I have a wife, 4 kids, wife's cousin, and maid who live there year round. I live there 5 months a year, nov to apr. The past 2 years the DR has gone from an almost paradise to an almost I am outa there. Costs, crime, drug use and sales have all skyrocketed. Its definitely less safe in the DR, I guess the government thinks so also, ie. curfew. My family still lives there and I will be down there in Nov. but its just not the same anymore. First time I think i have ever agreed with "Cris"

 

[drgolfer]

Did I read correctly, back a few posts, someone say that because they believe that the middle class is doing better, i disagree, that the lower class must also being doing better?? I know someone said that a few posts back. Where did this come from?

Next, because the supermarkets are full of people, that means times are good or better? I just don't get where some people get these correlations.

 

[drgolfer]

Go to Jumbo off of San Vincente on the weekends, it's jammed packed!

Go to Jumbo off of San Vincente on the weekday, and it's empty!

What does this say about if its getting better in the DR?

 

[chola1978]

Please do not think for a second things are getting better in the DR. I have a wife, 4 kids, wife's cousin, and maid who live there year round. I live there 5 months a year, nov to apr. The past 2 years the DR has gone from an almost paradise to an almost I am outa there. Costs, crime, drug use and sales have all skyrocketed. Its definitely less safe in the DR, I guess the government thinks so also, ie. curfew. My family still lives there and I will be down there in Nov. but its just not the same anymore. First time I think i have ever agreed with "Cris"

ofrescome.........So now are going to base economic progress on drug use and cost of living.
que pasa? vamos hacer mas serios!!! Question in Hand is as a sobern nation are we better than when Baleguer, Mejia and Leo first period yes or not. simple....Let not look into personal issues that have nothing to do with local economy. I only gave my example cuz I think I contribute to this local economy by creating jobs and have more cash circulate the streets of Santiago.
My honest observation is that now things are somewhat better.........Some industries are flourishingly and others are becoming obsolete. Normal in a capitalist economy...