Negative savings has been a problem for years. When the gubmint said "we'll take care of you forever", folks actually believed them, and behaved accordingly <insert Little Red Hen fairy tale here>.
The rest is history.
- Thread starter samanasuenos
- Start date
The DR and the Recession of 2008
The rest is history.
Recession fears slam stocks
Stocks plummeted this morning after an emergency rate cut from the Fed failed to reassure investors worried about a recession. The Dow tumbled more than 400 points right after the opening bell, then recovered a bit. International markets also have plunged on worries about a global slowdown
CNN.com
Like I said, a real plan to intervene must be put in play other than the rate cuts that won't assure anybody of anything else but sure to come higher inflation...
Bush needs to step aside from politics and use a chunk of the money to put back millions of foreclosures in ice, mostly by creating a safe heaven that will serve to freeze any further action on the declining market and the investors.
If you start at the root of the initial shock wave, you can create a positive flow without contributing to further inflation or in the case of the actual economy, doomsday fever that permeates it.
Those who invested into high yield/risk taking via the loaning institutions will not be as affected economically as the middle and lower brackets of the socio-economic ladder of the system.
The DR's local economy continues to make strides even in the face of the crashes left and right. Sustained by foreign liquid being moved to safe heavens and quasi investment on real estate of the country, it proves that the economy will persevere rather than collapse via the domino effect.
If one thing has been learned for ages, it's that rum and cigars along other bad habits, increase during periods of high stress....
The deeper the economic trouble, the deeper the glass to drown them...
"Broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households. Moreover, incoming information indicates a deepening of the housing contraction as well as some softening in labor markets," the Fed said in a statement. CNN.com
Translation:
Broader financial market conditions have continued to deteriorate =
Things are getting worst by the day to big/med/small biz this less than 30 days cycle of 2008...
And credit has tightened further for some businesses and households. =
Banks shut down almost all lines of credit to biz in 2008 and consumer's line of credit
Moreover, incoming information indicates a deepening of the housing contraction =
Worst yet, a nasty amount of new foreclosures are in line and inventory continues to grow unimpeded.
As well as some softening in labor markets," the Fed said in a statement. =
Big time lay offs are announced in line for first quarter of 2008 to start next month of FY 2008(when most biz start the year)
Translation:
Broader financial market conditions have continued to deteriorate =
Things are getting worst by the day to big/med/small biz this less than 30 days cycle of 2008...
And credit has tightened further for some businesses and households. =
Banks shut down almost all lines of credit to biz in 2008 and consumer's line of credit
Moreover, incoming information indicates a deepening of the housing contraction =
Worst yet, a nasty amount of new foreclosures are in line and inventory continues to grow unimpeded.
As well as some softening in labor markets," the Fed said in a statement. =
Big time lay offs are announced in line for first quarter of 2008 to start next month of FY 2008(when most biz start the year)
Scroll down to last paragraph
:ermm:From "Dominican Today"
January 23, 2008, Updated 6:34 AM
SANTO DOMINGO.- National Business Council (Conep) president Lisandro Macarrulla today said the organization agrees with publishing the names and the amounts of money businesspersons give to the political parties in the current campaign.
"I don?t believe in the numbers which have been given on the cost of the campaign," which he said is more than the approximately three billion the parties have said they?ll spend. "I do not believe in that number."
"The Conep hasn?t reached the sincerity level for a businessperson to say how much they give to each party," admitted Macarrulla, who said he agrees in limiting the amount of money given as contributions to the parties. "We agree in saying not only what amount, but who gives it."
On Monday Macarrulla complained of the "level of superficiality" in the electoral campaign?s topics, since none of the candidates? government programs say how they?ll manage to maintain economic growth and to lower social exclusion.
He said the political parties "are digging their own tomb" from the manner they turn everything into politics
Interviewed in the Uno+Uno program on Teleantillas, the Conep chief said the possibility of an United States recession and what it means to the country?s economy is one of the main topics the candidates must debate. "At this moment an economic impact study on the recession in the United States should already be being conducted."
My Questions:
1. If there were no recession and little impact, why would they bother with an economic impact study?
2. And how can we get access to it? "It" being the study, and not a larger brain, though I will take one of those with my platanos, please.
Gracias,
Sammy (the OP!)
:ermm:From "Dominican Today"
January 23, 2008, Updated 6:34 AM
SANTO DOMINGO.- National Business Council (Conep) president Lisandro Macarrulla today said the organization agrees with publishing the names and the amounts of money businesspersons give to the political parties in the current campaign.
"I don?t believe in the numbers which have been given on the cost of the campaign," which he said is more than the approximately three billion the parties have said they?ll spend. "I do not believe in that number."
"The Conep hasn?t reached the sincerity level for a businessperson to say how much they give to each party," admitted Macarrulla, who said he agrees in limiting the amount of money given as contributions to the parties. "We agree in saying not only what amount, but who gives it."
On Monday Macarrulla complained of the "level of superficiality" in the electoral campaign?s topics, since none of the candidates? government programs say how they?ll manage to maintain economic growth and to lower social exclusion.
He said the political parties "are digging their own tomb" from the manner they turn everything into politics
Interviewed in the Uno+Uno program on Teleantillas, the Conep chief said the possibility of an United States recession and what it means to the country?s economy is one of the main topics the candidates must debate. "At this moment an economic impact study on the recession in the United States should already be being conducted."
My Questions:
1. If there were no recession and little impact, why would they bother with an economic impact study?
2. And how can we get access to it? "It" being the study, and not a larger brain, though I will take one of those with my platanos, please.
Gracias,
Sammy (the OP!)
I agree, at the same time, these are not your typical investors. These are people who scrap and have scraped to purchase a home in the US. Most foreign investors are not from the US and so will not be totally affected by the US downturn. Sure, they will feel a pinch but many large investors have diversified their portfolios into the Chinese, Dubai and South American (Brazil) markets.
At the same time DR have also diversified and is not as dependent on the US as 10 years ago.
Looks like you are right.:ermm:
U.S. faces severe recession: NBER's Feldstein
The United States is in a recession that could be "substantially more severe" than recent ones, National Bureau of Economic Research President Martin Feldstein said on Friday.
"The situation is very bad, the situation is getting worse, and the risks are that it could get very bad," Feldstein said in a speech at the Futures Industry Association meeting in Boca Raton, Florida.
"There's no doubt that this year and next year are going to be very difficult years."
NBER is a private sector group that is considered the arbiter of U.S. business cycles.
U.S. faces severe recession: NBER's Feldstein: Reuters Business News - MSN Money
JPMorgan to buy Bear Stearns for $2 a share
BSC was around $160 US per share less than a year ago, crashed to $80 a couple of months ago, crashed from $57 to $30 on Friday, and now they are being picked up for $2 worth of JPM stock.
Talk about not trying to catch a falling knife.
BSC had some nice bounces of Friday for some quick trades but it really is more like a game of musical chairs and the people left holding the stock do not have a chair or much of their investment.:surprised
Tourism is still more Euro than American but i suppose import/export,investment and remittances will shrink alot.
Quite possibly USAID and loans as well.
D.R. is very much a transnational country and still an neo-colony of the US and tottally dependant of its interest.
So yeah its looks bad outside of turismo.
Quite possibly USAID and loans as well.
D.R. is very much a transnational country and still an neo-colony of the US and tottally dependant of its interest.
So yeah its looks bad outside of turismo.
Could you please name a few? I've seen this posted before and I would like to know more about what resorts are mostly owned by dominicans.
AND if at all possible could you please tell me how do they reinvest in the community or do they send the money back out to foreign banks?
thanks
What am I? The service desk at the DR's investment resources center?
Just take a look at Cap Cana, Juan Dolio, La Romana, etc... There you'll find fresh news on the media about the financial break-up of shareholders with ease...
A good 90% of existing resorts operate under CxA and the like; you'll be hard pressed to make questions (if you dare) on the people's names at the background.
I happen to know many people that actually own shares in many big projects in the DR and speak from first hand experience as an investor myself.
Not only are most of these projects majority owned by Dominican shareholders, but also Dominicans are the majority of buyers in the units offered to the public by a land slide...
The Dominican Republic was not any different from Haiti back in the early 1970's; if anything, Haiti had a better developed tourism industry than ours at the time. It was past the first years of the 1980's when driven by new policies adapted by the CB of the DR, which made it possible to repatriate large accounts into Dominican banks; Sans red tape that made it possible for large pools of well established Dominican citizens to return to the country for good, investing their money into large projects.
It was during the 1980's when many Dominican families (Rodriguez, Pichardo, Pons, Diaz, Corona, Pepin, Abraham, Goris, Infante, Marte, Cassals, Ramirez, Medina, Piantini, Luna, Mercado, Colon, Marinez, De La Brea, Marriott, Patina, Mendez, Perez, Fadul, etc...) returned to the DR after having invested in foreign countries with high success.
They came to a country lacking of every single form of modernity and development and acted on it as they could. The first all inclusive started sprouting in the coast of PP soon after. In the cities of SD and Santiago new (larger) shopping stores popped up within months of each other. TV cable was implemented by people like Leonardo Lopez out of his home in Licey to Santiago.
Plazas were starting to take shape more and more, each time the newer ones surpassing the latter as they popped up around the cities.
All this was 100% Dominican owned and only after the better last part of the 1990's did foreign investment did take off. The foreign investment is always under a lower partnership agreement with Dominican nationals, who make up the majority and largest shareholders of the deals.
Today the same is truth as new and bigger projects are taking place all around the country. Take Cap Cana for example and do some background nosing around... You'll find that most of the project is in the hands of Dominican shareholders unlike what many believe!
Now, go do some background checking and come back to post your own gathered "facts" to post here, else anything I provide will be "questioned" as per source...
why so defensive? I was asking because I am curious. Not being cynical at all.
Any way it's not that serious. I don't have the energy to spend looking around. I just wanted to pick your brain.
But thanks anyway
Any way it's not that serious. I don't have the energy to spend looking around. I just wanted to pick your brain.
But thanks anyway
Check CNN news today and see where investors are putting their money into... The falling Dominoes just started and the DR will see their import/export balance affected positively from a falling dollar, soon to be shored up via large liquid loans by the Fed to banks and financial institutions alike...
Gold price is going up by the minute...
The spike in oil prices will also add to the DR's benefit as goods from our FTZ will be cheaper to transport to the US market than Asian goods for the better part. Housing trends point to retirees looking out of the bounds of FL to make best use of their retirement funds accordingly.
It's only the beginning...
aranoid:You're correct on the "It's only the beginning".....this week is the tip of a rapidly melting iceberg and Washington can't possibly bail out everybody (remember W has helped create a trillion dollar debt)Housing trends point to retirees looking out of the bounds of FL to make best use of their retirement funds accordingly.
It's only the beginning...
Retirees might be LOOKING outside of Florida, but their retirement funds are being severly depleted....from conversation I've heard, they look at Mexico City and the area near the University to retire as it is easier to cross back "home"....
I doubt the DR is high on many lists.......
Hm, there are 76 million babyboomers who are just now beginning to retire.
If only half of a percent of all American babyboomer retirees have the DR on their retiring radar, that would be more than enough to satisfy the Dominican market.
-NALs
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Hm, there are 76 million babyboomers who are just now beginning to retire.
If only half of a percent of all American babyboomer retirees have the DR on their retiring radar, that would be more than enough to satisfy the Dominican market.
-NALs
Thank god I am not a babyboomer, with inflation as reported in the DR1 at
Inflation at 9.4%
The Central Bank reports that the Consumer Price Index is now at 9.4%, accumulated from January to August. Increases in food prices and the cost of school tuition affected the rates. Inflation in August was up 0.09% compared to July.
See Banco Central de la Repblica Dominicana
Better have a better plan.
For sure.
Despite the inflation, which is overwhelmingly concentrated in the price of petroleum and foodstuffs and is still historically fine (compare to the 26 year high inflation rate the US is going through right now), the DR still offers more purchasing power per U.S. Dollar than such currency offers at home and, U.S. Dollar savings accounts and other interest-bearing investments in the DR are currently earning much more interest than in the U.S.
Thus, in the DR babyboomers have the chance to buy more per dollar than in the US due to the exchange rate AND earn more in passive investments than in the US due to the interest rate.
Cost of real estate is lower in the DR than in the US for similar properties. Overall cost of living in the DR can still be lower than in the US, while being of greater quality (in DR they can afford more home, maids, etc. that in the US many cannot, to give an example). Passive earnings on investments in most cases are still greater in the DR than in the US.
You are definitely correct!
They better have a better plan.... that includes the DR in their retirement picture.
-NALs
Absolutely incorrect.
The purchasing power parity with respect to comparitive goods and services places the Dominican Republic as much more expensive than the other less developed and developed nations. In fact, the DR, due to its high rates of inflation, excessive taxation on imported goods, increased levies on income and exhuberant consumption tax (currently 16%), combined with the high credit rates (approximately 40% on bank interest rates) and the over-valued Dominican peso at 35.15 (at an net real rate of devaluation at 5,72%) point to monumental inflation pressures and reduce parity.
Dollar based investments in the local banks (based on their international ratings) pay well below the risk premium attributable to the country, with its "watch" stauts and current quasi fiscal deficits and government abusive spending. Lets not forget the meltdown on dollar deposits of offshore Dominican bank subsidiaries, the collapsed 6 hears ago amidst the lack of reserves and ability to cover the devaluation offsets- their balance sheets looked much like those of Lehman and others today....Beware of the banks and dollar investing in the Dr, you must be very selective about the Bank in question.
The advantages of low wages, inexpensive labor resulting from the decayed and lacking school system and squatter Haitian laborers are augmented by the kind and noble people who are tolerant to the depressed nature of their conditions. The inexpensive nature of construction is all on the labor side, and with the costs of materials increasing dramatically, the comparative advantages you can realize in the DR on a nice, beachfront development in a relatively secure area is diminishing quickly. If you employ someone, while the labor is inexpensive the government seeks to add another free month, and the liquidation laws are based on years/ highest last wage earned (still a competitive advantage but declining).
While DR properties are still less expensive, their relative costs of construction has increase and their values are declining- again, the argument is based on lack of liquidity in the secondary sales market of property nationwide. You can read pages of this argument by posts on this network that describe how hard it is to sell a property and how little they are getting for them. Not every project being the same, selection and location is key- however, on the basis of comparison, the cost advantages to living in the DR are not in its favor - and becoming much more expensive.
Other countries, such as Panama, Costa Rica, Mexico are much more attractive today from a cost perspective. Other issues need to be reviewed to balance their attractiveness. Additionally, the medical services available in these countries in the "tourism" areas are much more developed than those in the DR- something an elderly individual must take into account before looking to invest in the areas where we have little in the way of medical clinics with depth of care.
Miami and Southern Florida today beats them all for costs, attractiveness, services and cost/opportunity- hands down.
The purchasing power parity with respect to comparitive goods and services places the Dominican Republic as much more expensive than the other less developed and developed nations. In fact, the DR, due to its high rates of inflation, excessive taxation on imported goods, increased levies on income and exhuberant consumption tax (currently 16%), combined with the high credit rates (approximately 40% on bank interest rates) and the over-valued Dominican peso at 35.15 (at an net real rate of devaluation at 5,72%) point to monumental inflation pressures and reduce parity.
Dollar based investments in the local banks (based on their international ratings) pay well below the risk premium attributable to the country, with its "watch" stauts and current quasi fiscal deficits and government abusive spending. Lets not forget the meltdown on dollar deposits of offshore Dominican bank subsidiaries, the collapsed 6 hears ago amidst the lack of reserves and ability to cover the devaluation offsets- their balance sheets looked much like those of Lehman and others today....Beware of the banks and dollar investing in the Dr, you must be very selective about the Bank in question.
The advantages of low wages, inexpensive labor resulting from the decayed and lacking school system and squatter Haitian laborers are augmented by the kind and noble people who are tolerant to the depressed nature of their conditions. The inexpensive nature of construction is all on the labor side, and with the costs of materials increasing dramatically, the comparative advantages you can realize in the DR on a nice, beachfront development in a relatively secure area is diminishing quickly. If you employ someone, while the labor is inexpensive the government seeks to add another free month, and the liquidation laws are based on years/ highest last wage earned (still a competitive advantage but declining).
While DR properties are still less expensive, their relative costs of construction has increase and their values are declining- again, the argument is based on lack of liquidity in the secondary sales market of property nationwide. You can read pages of this argument by posts on this network that describe how hard it is to sell a property and how little they are getting for them. Not every project being the same, selection and location is key- however, on the basis of comparison, the cost advantages to living in the DR are not in its favor - and becoming much more expensive.
Other countries, such as Panama, Costa Rica, Mexico are much more attractive today from a cost perspective. Other issues need to be reviewed to balance their attractiveness. Additionally, the medical services available in these countries in the "tourism" areas are much more developed than those in the DR- something an elderly individual must take into account before looking to invest in the areas where we have little in the way of medical clinics with depth of care.
Miami and Southern Florida today beats them all for costs, attractiveness, services and cost/opportunity- hands down.
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