Afra Raymond, Citizen Advocate
The following article by Afra Raymond about state owned hotels is timely because of the government of Barbados decision to dump the Barbados Hilton for USD80 millions -it is being whispered. The point Afra raises about the need for disclosure of the agreements between government and the hotel management company in the public interest fuels BU’s concern about the cloak of secrecy by the government of Barbados to dump a prized possession for 30 pieces of silver. It seems like the other day the government of the day sold the national bank to fund the implosion and rebuilding of the historic building at Needam’s Point.
Oh, what a tangled web we weave, when first we practice to deceive! (Sir Walter Scott, 1808)
David –Blogmaster
At the end of January 2018, the Ministry of Trade & Industry and its implementing agency, Evolving Technologies & Enterprise Development Company (ETECK), announced the completion of a $7.6M project for the renewal of the Trinidad Hilton Pool. According to the official statements, that project was completed on time and within budget, as part of […]
“DO you think that the GOB really wanted to be in the hotel business on the South Coast?
GOB went into these area because your private sector was risk averse?
They call upon the taxpayers to take the risk.”
enuff said.
What kind of democracy could be allowed to dispose of state assets weeks before an election. An election this government will lose.
If there is no money in the coffers how can they get their buy outs and pensions
This is how forex leaking will force this kind of a barbaric decision.
Pachamama February 20, 2018 at 7:13 AM #
What kind of democracy could be allowed to dispose of state assets weeks before an election. An election this government will lose.
++++++++++++++++++++++++++
What kind of democracy would put these assets in the hands of the state???
Answer …… a fascist/communist style democracy …. we call it democratic socialism!!
There’s a saying …..BUILD IT AND THEY WILL COME…. well, I suggest it should be FIX IT AND WE WILL COME BACK…and I mean fix the infrastructure like sewage and roads .
Just another DLP teefin’ scam.
Commissions and shares for them and their friends.
MIA better be ready to prosecute these teefs or there will be no return to business credibility for this nation.
“MIA better be ready to prosecute these teefs or there will be no return to business credibility for this nation.”
Way back in time it would be called a Duffus or a Moyne.
But modern context gets us Coleman (Clico), Patterson or in US context Mueller.
So yes I too would love to see a new non DLP PM budget a few million for a commission of enquiry “empowered by law” to investigate illegal project bid transactions, graft, ministerial conflict of interests resulting from financial interest with private corporations and all other matters of government financial malfeasance.
We have a chairman ready to put his reputation for excellence into that role too: Dr. Cheltenham.
We could only wish!
For the last 10 years I have been hearing that the BLP “tiefing and getting kickbacks”.
The DLP win the election in 2008 and I have been hearing that they “tiefing and getting kickbacks”.
Where is the actionable incontrovertible evidence ?
And you will get no end to this fanciful commission….but taxpayers will be bilked in the millions.
Any chairman for any commission of inquiry should be non bajan…
Cheltenham is lawyer for the same private crooks stealing from the treasury and pension fund…ask him if he is not the lawyer for crooked cow et al….. friends and business partners and manybe even family with the same corrupt politicians and ministers.
How will things ever change or corruption be dismantled and eradicated, if inquiries are filled with the same conflicts of interest persons…each and every time.
I could swear the auditor general…each year in his reports, outlines evidence of outright thefts of taxpayer’s money going back years, irrefutable proof and evidence…which is ignored by government and everyone else and quickly forgotten on the blogs.
Bloggers seem to have an attention span and memory retention of two weeks…tops..
Ah guess that is better than goldfish…but completely useless if radical changes are to be made on the island..
Lol
Hants February 20, 2018 at 10:37 AM #
For the last 10 years I have been hearing that the BLP “tiefing and getting kickbacks”.
The DLP win the election in 2008 and I have been hearing that they “tiefing and getting kickbacks”.
Where is the actionable incontrovertible evidence ?
………………………………………..
As I’ve stated here before, I was never solicited for a bribe under the BLP administration.
Since 2008 I have been solicited 5 times, 3 times supposedly on behalf of ministers.
DLP gov’t graft is widely discussed in local and foreign business circles with supporting whattsapp and e-mail messages circulated among colleagues.
If you don’t move in business circles or maybe have nothing to offer the corrupt, you would never be approached or know anyone who has been.
But, all of the above is irrelevant. The reputation stands and so does the effects; the near-total business development disengagement from this country that has brought our economy to its knees.
Under the last two terms of BLP gov’t, Barbados had a reputation of having a grossly inefficient civil service that just about paralysed new business and development. Owen Arthur and some of his ministers micro-managed their ministries to barely keep the wheel of progress lubricated and we crept forward.
In the absence of any DLP management skills of any kind, micro or otherwise, It is obvious to me that the civil service paralysis created fantastic ‘facilitation’ opportunities for the corrupt and corruptible without having to solve the endemic problem for the rest of the law-abiders who would like to function here.
They were warned. 4 years go Goddard’s told Fumble to make doing business easier or they would disengage. It was obvious to anyone in even the smallest business.
There was never any chance of economic recovery under Fumble’s Fools.
@ Frustrated Businessman wrote “Since 2008 I have been solicited 5 times, 3 times supposedly on behalf of ministers.”
Where is the incontrovertible evidence that this happened ?
@ David
Now you understand what this trained economist was pointing BU to. Choose the persons who man these institutions very, very carefully.
It does help if the Party has a sound, and carefully thought out philosophy. Then have that philosophy clearly articulated and explained to the Electorate.
For the most part all the parties are coasting on an ideology whose shelf life expired in the last decade of the last century.
Where are the millennials? Are they fully aware of the new social ,political and economic environment in which they have to operate going forward?
The Monday morning cuss out at the stand pipe will not do. We want more.
@Bernard
You have asked an interesting question about where are the millennials. Clearly this group operates on the fringe of the political system and their support is coopted around election time. How do we realistically expect the system to refresh if this group for whatever reason is disinterested?
Frustrated.., anytime any politician, government minister, permanent secretary…lawyer etc approach you again for extortion reasons…tape them.
Imagine the chaos we would see if the FX reserves are all gone and US$’s have to be purchased on the open market to pay for imports. What we are now seeing is the sale of assets to prevent that scenario.
Bottom line and where the rubber meets the road….we have to stop the fx bleeding. That by default means cutting way back on the printing of money.
@ David
One has to mentor the millennials very carefully. We have to put in the time and the effort. There is a tendency to give them things rather than our undivided attention. We look over our shoulders hoping somebody else would do it. But should we not ask: “Why not me?”
SETH at 12 :19 PM
What printing of money what? What do you mean by that statement?
What about earning foreign exchange?
What about repatriation of foreign exchange earnings?
Does it really matter if the imports are paid for out of your “open market”shenanigans, rather than from the official stash of foreign reserves?
One cannot sell assets for ever. Selling one’s house to feed oneself is never a solution. Earning a steady flow of income is a sustainable solution.
Does it really make economic sense to sell one asset below replacement costs and true market value, and borrow money to put up two similar assets of doubtful earning capacities ?
Who are we really trying to fool?
SETH
Have you really analysed the composition of the imported goods/ services?
How much goes to finance the inputs to the tourism sector?
How much is spent on inputs to the construction sector?
How much is spent on the inputs to the Public Utilities ( Electricity, telephones,road building etc)?
Is it really true to say that the bulk of imports are for consumption?
It is only necessary to “print money” if taxes are not raised or public sector loans are not taken up,or public expenditure is on unnecessary activities.
@Bernard
We need to generate more forex by expanding our export earning capacity, we need to manage leakage of foreign exchange and your favorite, we need to infuse the economy with a dose of confidence.
There is the need to modify behaviors that lean on foreign taste/consumption.
Exactly Bernard.
This country is stifled by a useless civil service. The previous BLP administration worked around them, the current DLP administration have failed to do so or address the problem.
Barbados economy cannot continue to shrink as Seth suggest, it has to grow and the current bureaucratic environment does not facilitate that. The graft is a result of the opportunities that environment created.
Hants, keep your head up your ass boy, the real world out here is no place for you.
WW&C, Thompson taught these devils how to teef with legal and professional fees all above board. If he had issued a company invoice and paid the VAT on the money he and Parris stole from CLICO, his cheque would never have shown up on an election podium.
Our little property is valued at US$130,000 per room plus public areas and 1.2 acres of spare land. All indications are that the Hilton would cost at least US$400,000 per room to build, so with 354 rooms that gives an indication of worth. So to agree to anything like US$80 million
would be grossly understating the taxpayers interest. Remember also that the Hilton has outstanding debts quoted at BDS $100 million mostly due to NIS , so if any amount is written-off and further concessions given this proposed sale is another Blue Horizon (but larger) in the making.
@Adrian
Sale price is determined based on room plant and revenue earning capacity.
Frustrated lol…i cant wait for this lot to be kicked out and an independent investigation reveals all the crimes they committed,
Mia or whomever would be fools not to facilitate a thorough criminal investigation, seeing as even if there was no bad blood between some of them before, there is sure some now.
9:30 a.m 6
7 CV0271/2009 Mia Amor Mottley v. National Cultural Foundation
8 CV0272/2009 Owen Arthur v. National Cultural Foundation
9 CV0273/2009 Owen Seymour Arthur v. Caribbean Broadcasting Corporation
Adrian, I was recently told by a very large hotelier that new hotels in the Caribbean average at US$100,000 per room and Barbados at US$350,000 per room, not counting the land so your numbers are not far off.
Hilton is probably worth around US$130 m
@BC
Where can we find these numbers?
“We” travel on roads most days….that is indirect consumption….not just the cost and maintenance of the vehicle used for transport. “We” use (consume) communication services. “We” consume electricity. “We” have shelters, erecting and maintaining those shelters is consumption. “We” consume food daily. “We” consume water and sewerage services daily.
There is also similar consumption used by visitors.
“Sale price is determined based on room plant and revenue earning capacity.”
Sale price is determined by what some other party is willing to PAY the owner, in a manner acceptable to the owner.
@Northern
Yes price is what the market will bear. However, there is science to identifying the price based on ROI criteria.
@ Adrian at 2:36 PM
Your approach to valuation is very close to mine.
There is really no need for GOB to get involved directly in Hotel construction. Past performance is discouraging. New hotel construction and ownership should be left to the private sector.
The Hilton was supposed to be a flagship in the latter 1960’s for the then underdeveloped South Coast. The return to the taxpayers was minimal directly but invaluable for the demonstration effect it had for south coast development.
NorthernObserver February 20, 2018 at 3:02 PM #
“Sale price is determined based on room plant and revenue earning capacity.”(Quote)
Wrong. In the real world, valuation is one thing, sale price another. The sale price is determined by the asking price, what the seller wants, what the buyer is prepared to pay, and what the seller is prepared to accept.
Northerner
We are talking economic value.
We are also talking about the historical cost of construction.
We are talking about the replacement cost /present cost of putting up a similar Hilton Hotel.
We are talking about the Net present value of future flow of revenue of the Hilton Hotel say 30 years.
Your reference to what a buyer can or will pay is an irrelevancy which should remain in the textbook until we do a fire sale.
Surely your willing buyer’s offer is and cannot be described as a fair market value?
That should be ” is not “.
There is no ‘science’ to return on investment. That applies if it is a legitimate trading business and how much the buyer wants the business, its synergies with any existing business.
But the value of a business is what the seller is prepared to accept and the buyer is prepared to pay. Everything else is theoretical.
The difference between the sale of a private business and one that is listed is that you have a lot of shareholders to deal with on the one side, and the owner(s) of the private business, on the other.
Without diverting, it brings us back to the role of an audit in a listed company; auditors have a public service responsibility with listed companies. With a private company, caveat emptor.
It is interesting that in the case of Carillion its annual report and accounts were passed at the end of March, and in July, three months later, it issued a profit warning. Clearly something was wrong. Read the reports on HP’s purchase of Autonomy Corporation.
A few years ago a well-known, young Barbadian lawyer asked me if I could find a buyer for his client’s small hotel; I said I would put word out, and asked for the last three years’ trading figures. Which is normal. He hesitated. I also asked for his rolling business plan, although that was not necessary, it wold have helped.
To cut a long story short, what he was telling me about ‘a going concern’ as a hotel turned out to be a business that had been closed for some time. I reminded him that what he was selling was a property, not a business. It was the last I heard from him.
No matter how many rooms he had, if the business was not trading it was simply land and a disused building.
UPPER UPSCALE
Hilton
Global Footprint: 572 hotels; 206,635 rooms
Hilton Take: “The stylish, forward-thinking global leader in hospitality,” this is Hilton’s flagship brand and often ranks No. 1 in terms of its global brand awareness in the hospitality industry.
https://skift.com/2016/11/02/every-one-of-hiltons-13-hotel-brands-explained/
Hants February 20, 2018 at 4:23 PM #
Marketing PR.
@bernard
the point I am making on FX is the same one made by the Central Banks
“Serious challenges linger for the Barbados economy, Acting Central Bank Governor Cleviston Haynes disclosed today.
In his report on the island’s economic performance for the first nine months of the year, Haynes outlined a worrying slide in already low international reserves.
At the end of the third quarter, reserves had reached 8.6 weeks of import cover, which is below the international benchmark of 12 weeks.”
and on the printing of money as the PM said :
“Acknowledging that Government should not have to turn to the Central Bank to have money printed to finance government deficit, Prime Minister of Barbados The Rt. Hon Freundel Stuart has however noted that the present
administration has done so because “government has bills to pay”.”
So the money the government prints to pay its bills filters its way into the hands of the Barbados population who spend a great percentage of it on imports, be it food, smart phones or cars. Those imports have to be paid for with FX.
The balancing of FX “ins” and “outs” appears to be reaching a desperation point thus the fire sale price of the Hilton.
SETH February 20, 2018 at 4:40 PM #
So the money the government prints to pay its bills filters its way into the hands of the Barbados population who spend a great percentage of it on imports, be it food, smart phones or cars. Those imports have to be paid for with FX.(Quote)
There is nothing wrong with printing money. In fact, if used properly, it is advantageous. Extra liquidity leads to asset bubbles, but this can be controlled either through the manipulation of the base rate, or by taking the money out of the economy from the banks and credit unions. ie increasing capital reserves with the central bank.
It is now approaching 30 years since central banks have been targeting inflation.
Whoever buys the Hilton will do so as an investment.
Whoever buys the Hilton will do so as an investment.(Quote)
That much is clear, they will not buy it to put it in a museum. But the metrics must be more than just an investment. It must fit in with their existing portfolio; earning potential must be there. This includes local competition (Sandy Lane, Sam Lord’s, Hyatt, and the numerous other three, four and five star hotels).
It depends on Barbados continuing to be a long-haul destination for middle class and professional travellers. At present, apart from sun, sea and sand, there is very little to attract top end visitors.
Top end hotels will not appeal to weekend travellers from neighbouring islands, no matter how wealthy. We badly need a series of boutique bed-and-breakfast accommodation.
Most people will not leave Europe and North America to eat in local restaurants; to see local entertainments; to visit local museums; to go to local theatres; concerts; etc. Tourism is a package, by that I mean people will do things while here, but they will not leave home just to do those things.
We have no leisure infrastructure, so once the sun goes down people are left to drink before retiring.
@ Bernard Codrington February 20, 2018 at 3:04 PM
“There is really no need for GOB to get involved directly in Hotel construction. Past performance is discouraging. New hotel construction and ownership should be left to the private sector.”
That sounds like the kind of economic talk we expect from BC instead of seeing the public sector as any viable engine of long-term sustainable economic growth thereby providing the resources to facilitate social development.
Government’s role in a political democracy with a capitalist economic orientation is to encourage and where possible stimulate economic activities to generate enough surplus profits to fund the social services required for social development leading to the ‘good’ society expected by the masses who voted for it
Let the government be first and foremost the facilitator of economic enterprise and, in some cases, the fillip to economic adventurism by being the willing reinsurance company where the risks are too great to be borne by individual players in the private sector.
So the question to be posed you- and definitely deserving of an answer- is who or what is stopping the private sector principals behind the Hyatt hotel erection from playing the role you have so ‘precisely’ identified?
Is it the one-man-band David Comissiong?
Is it as a result of the failure to find foreign financing backers? Or is it that the NIS easy-funding faucet has been turned off by the mandate given to the MoF by the IMF and the credit rating agencies with respect to the issuing of sovereign guarantees for future investment in matured and sunset industries?
@Blogmaster (cause HA rarely reads a thread)
I appreciate the science.
Allow me to share a conversation with a former classmate who is now CFO of a top 20 Canadian company. They could today, be the country’s largest warranty provider. [my guess]
After the pleasantries…
Caller: do you know what the credit rating of your sunny isle is?
Me: Not good.
Caller; Not good? You mean junk.
silence
Caller: Do you know what my board would do to me if I opened a captive operation there?
Me: are you asking me for current openings in the CFO field, or contacts in Bermuda?
Caller: [chuckling] good to know you still have a sense of humour.
One may choose to forget, the Barbados of 2000 is not the Barbados of 2018. We can calculate replacement costs, future net or discounted cash flows, guesstimates of incentives, projected costs or ROI, blah blah blah.
When it comes to assets the $$$ size of the Hilton, the BNTCL etc etc, and the seller wants $US, the potential buyers shrink. Add in a CCC rating, and they shrink further, esp the publicly traded entities. Add in certain infrastructural concerns, and they shrink again.
Just look at the good gentlemen above, whose P&Q has been officially listed for how long? And that is at the lower $$$ end. Moving things in Bim isn’t easy.
Uncertainty = discounts.
@Northern Observer
Point taken and makes Bernard’s intervention all the more relevant. To sell a national asset like the Hilton, its location, its historic value etc is nonsense.
@ Miller at 5 : 21 PM
You are playing devil’s advocate this evening are you not? You know quite well my position on these issues. So please re- pen them.
In passing, the IMF and the credit agencies do not give directions to sovereign governments. They merely express an opinion. Sovereign governments take responsibility for their mistakes and actions or in-actions.
So do not go looking for Bogey men. We are all adults now we need no external control.
@ Northerner at 5 : 31 PM
You have made a perfect case for not selling Hilton Hotel at an undervalue. I will be worried when Hilton is not satisfied with its brand name use and management fee of 20% + of gross revenue.
@ Bernard Codrington February 20, 2018 at 5:41 PM
“In passing, the IMF and the credit agencies do not give directions to sovereign governments. They merely express an opinion. Sovereign governments take responsibility for their mistakes and actions or in-actions.”
Come on B C, you are not talking to a “D C” (David C).
Are you implying that both Jamaica and Guyana under IMF-dictated programmes could have done as they both saw fit in accordance with their own political and ideological agendas?
So why were their currencies devalued to almost cut-plate value?
So there is no truth in the statement that whoever pays the piper (lender of last resort to bankrupt countries) can call the tune (dictates fiscal and monetary affairs of that same bankrupt country)?
Given your response to SETH (@ Bernard Codrington February 20, 2018 at 12:50 PM) we are rather concerned about your ability to deal with the realities facing Barbados. In a few months without an emergency bailout from some Chinese or ME godfather we shall soon see who in Barbados would be taking responsibility for what would be unfolding.
Why is the GoB not privatizing (divesting) its commercial interests in the BNTCL and Hilton to the local private sector, both corporate and individual and are awash (allegedly) with cash holdings lying idle in the local financial system?
@Miller
I am convinced that our realities may be the same but what you see as a catastrophe I see as a challenge. We have walked a road with more pot holes than this one and with the right people in place and a can- do attitude we prevailed. So sorry, I cannot see the world through your lens.
@ Bernard Codrington February 20, 2018 at 6:42 PM
You mean the blinkered world of Bajans who believe the rest of the world owes them a living from the same foreign money they have been able to borrow like financial drug addicts from the international loan sharks without improving over time the productive ability to repay in the distance.
I see the Bajan world through the same ‘experienced’ eyes as SETH and Tron; not those incestuously blinkered by ‘insularly’ small island living with its Mickey Mouse currency for ‘play-play’ (monopoly) money.
@ David February 20, 2018 at 7:30 PM
It is making OSA- with his (in)famous reputation of selling off Barbados to ‘foreigners’ in true parro style- look like a reformed alcoholic who has been ‘dry’ for the past 10 years.
Who now would dare to refer to that 2012 outlaw and wanted economic bandit as “Seetru Arthur the parro of the BNB giveaway to Trickidadians and the West Coast real estate sales junkie?
Not even the dearly departed Alvin, ac, CCC or Fractured BLP.
Privatization has been re-branded under the DLP to “Divestment Looking for a Privateer” to take on a more politically correct sound and appeal contained in a bottle of social-entitlements labeled ‘economic recovery plan made of strychnine ready for mass distribution’.
The economic evil that men do lives after them while the good is interred in their political graves.
Maybe it was misconstrued I was suggesting the selling of the Hilton property at the rumoured price was a “good thing” or desirable.
My point was, it isn’t totally surprising, that was the ‘best offer’, under current conditions.
The ongoing deficits and growing debt are killing us slowly.
This makes entertaining reading outside of m
the realistic positions taken by Hal. We are
acting as if Barbados is some magical place
immuned from the realities of a rapidly
expanding small state with little developed
industries to sustain what by all evidence
is a lifestyle or consumer mentality that is
way beyond it’s ability to earn FX to
maintain far less sustain .
What we are witnessing, and we are all
complicit is a severe case of champagne m
taste with mau by pockets.
Just check the supermarket shelves and
find out the taste we have and then check
the consumers from the countries
where these goods come from who will
tell us point blank that they have to
buy store brands because they cannot. afford the brand names!
We have people driving 8 cylinder trucks
to work! We have people who will not
drink rum – brandy only. We have people
building mansions to be inhabited by four
people including two children.
Go figure and stop the excuses! The country
needs a dose of serious economic and fiscal
reality and it cannot and will not be
administered by the collective jokers
who now make up the government and
opposition.
Let’s cut the crap and call it for what it really
is. Now let me go and enjoy my second
cruise for the year before I go off on my
annul shopping spree to Miami befor
checking my partner in N Y.
Pick sense from dat !
@William
You have stated what the problem is and many on BU have articulated same- rampant conspicuous consumption- and the condition is not unique to Barbados. All economies are built on achieving growth to satisfy the needs of the society. As a people we have to ensure the inputs to that growth are built on a sustainable approach. Given the changing global markeplace we have to compete there will always be tension on how we do it. Because we like others are vulnerable to exogenous shocks we have to be efficient in how we do things. We have a generation who have no idea what it will take to survive in this world. It is easy to say we must do this and that but is it? How key stakeholders manage this period will riveberate for years to come. Some are set in their ways and there is high apathy with the young who are said to be well educated.
”””””’There is no ‘science’ to return on investment. That applies if it is a legitimate trading business and how much the buyer wants the business, its synergies with any existing business.”””””””””””’
The foolish man from England (Halton Austin) made the above remarks in response to a
‘Northern Observer’ statement.
We generally don’t read anything that asshole has to say but this load of ignorance caught our eye – in passing.
It’s unbelievable for a man who credits himself as knowing about financial matters, a financial markets journalist, etc.
A man who holds out himself as a sort of economic expert to make such statements
This a man who continue to opine about the lack of serious debate here on BU
A man purporting to advice government
How could it be possible to intelligently engage such a miscreant when simple factoids are denied.
We wonder whether Hallton Austin has ever valued an operating company, one!
We wonder if he has ever purchased a corporation, as a going concern, on his own account.
In denying the truth of what Northern Observer had to say, the perennial idiot known as Halton Austin, tries to impress us that he is some business guru by introducing specious factors like how much a particular buyer is willing to pay and talk about synergies.
Indeed such considerations are already factored into valuation science.
What a total asshole is this Halton Austin.
For those of us who know more than a little bit about company valuation Austin must try to explain how the establishment of EBITDA and the relevant multiples, based on industry sector, is not science. And if this popularly used rule of thumb is not science then what is it?
For the more advance thinkers on this subject, like Northern Observer and yours truly, the task of valuation begins with science but ends with art.
@Pacha
It was the blogmaster that made a reference to the science of using ROI and other key indicators to determine sale price as a point to inform negotiations. Although NO agrees he continued with a more pragmatic view given the current state Barbados funds itself.
David
We stand corrected!
For the more advance thinkers on this subject, like Northern Observer and yours truly, the task of valuation begins with science but ends with art.(Quote)
I have always thought that rockets going in to space was art…….see how bogus, loud-mouthed ignorance can shout down the intimidated and weak-willed? Something that starts as science can transform itself (or by magic) in to art, according to this foulmouthed nonsense – all this without Hollywood or fancy costumes.
It is the same brain dead ignorance that says Logic is not at the heart of philosophy. Aristotle must be turning in his grave. So have all those people who have worked on the subject.
For the more rational person, return on investment is a formula on which investors calculate their investments. But it is not science.
Science is based on conjectures and refutations, as we have been told by a great philosopher, a position endorsed by the Kuhn, while mathematics is linear, once proven it is proven. Science may be based on mathematics, but mathematics is not based on science.
Some may remember British Home Stores was sold by Sir Philip Green, a regular visitor to Barbados, for £1 to Dominic Chappelle. That included all its assets (freeholds, if any, leaseholds, merchandise, intellectual property, debt, liabilities and all).
What was his return on investment? How did he scientifically calculate that £1 was the full value of the investment? Was there logic in this sale?
David at 8 :35 AM
Comprehensively said.
Well educated ?
That depends on the definition of Education. If the latter means developing their cognitive skills we may be skating on very thin ice. Collecting information and treating knowledge as an asset is not education. Knowledge has a very short shelf life .It must continually be restocked. An educated person approaches life with humility and awe. The educated person is conscious of the fact that he knows little. Very often nothing.
@ Hal Austin at 9 :21 AM
Before Pacha brings out his guillotine , I would suggest you give us the full narrative ,including the anecdotal evidence surrounding this issue.
@ Bernard Codrington
@ David
It is about time that we stop “bragging”
about an education system that is woefully
disconnected from any known economic
policy. If that sounds strange, it’s because
it is !
Now explain to me how a country that was
at least 15 years late embracing technology
Within its education system is expected
to enhance its socio economic planning.
There is a reason why Sinckler cannot get
anything right and Mottley does not have
the answers.
Ever since an international diplomat
told us we were punching above our
weight, we have been on cloud nine
and now we are almost flat on our backs,
we still “bragging” . Strange indeed.
return on investment is a formula on which investors calculate their investments. But it is not science.
IT IS NOT SCIENCE BECAUSE IT CAN NOT BE REPRODUCIBLE AND ONE CAN NOT DEPEND ON THE FIGURE DERIVED
return on investment is INDEED ONLY a formula on which investors calculate their investments.
ONCE THE INVESTMENT IS MADE, MANY PARAMETERS CAN CHANGE SO THAT THE EXPECTED RETURN ON THE INVESTMENT DOES NOT OCCUR
FOR EXAMPLE FOLK WHO BOUGHT AND IMPROVED RENTAL PROPERTIES IN BARBADOS IN 2008 HAVE NOT BEEN SEEING THE EXPECTED ROI BECAUSE OF THE MAJOR INTERVENTION OF THE MISMANAGEMENT OF THE BAJAN ECONOMY, WHICH HAS RESULTED IN YOUNGSTERS WHO MIGHT HAVE RENTED SUCH REAL ESTATE HAD TO RETURN TO THEIR PARENTS HOMES.
MANY FOLK IN PORTSMOUTH DOMINICA AND ITS ENVIRONS WHO BOUGHT AND IMPROVED RENTAL PROPERTIES ARE NOW IN SERIOUS FINANCIAL PROBLEMS BECAUSE ONE OF THE RESULTS OF THE RECENT HURRICANES WAS TO REMOVE THEIR EXPECTED ROI AS ROSS MED SCHOOL DEPARTED THE DOMINICA SHORES
@ David at 8 : 49 AM
No need to apologize. Calculating a projected rate of return is a scientifically accepted method for testing the hunch that an investment will be profitable. It is one of the many heuristic tools used.
So Georgie if you tested my urine which I passed into an unsterilized beaker and the result came back false positive , does that mean that your test was unscientific?
Calculating a projected rate of return is indeed an accepted method or tool for testing the hunch that an investment will be profitable…………….but it is not fool proof or scientific
by definition a hypothesis is thought to be scientific if it is reproducible
WHEN EVER YOU ADD SUBSTANCE A TO SUBSTANCE B, UNDER THE SAME CONDITIONS SUBSTANCE C IS ALWAYS PRODUCED! THAT IS SCIENTIFIC!
SCIENTIFIC IS AN ABUSED WORD LIKE PROFESSIONAL AND PRESIDENTIAL ah lie?
Georgie Porgie February 21, 2018 at 10:44 AM #
Calculating a projected rate of return is indeed an accepted method or tool for testing the hunch that an investment will be profitable…………….but it is not fool proof or scientific(Quote)
Thank you. It is a financial mathematical formula.
So Georgie if you tested my urine which I passed into an unsterilized beaker and the result came back false positive , does that mean that your test was unscientific?
YES BECAUSE IT WAS NOT DONE UNDER STANDARD CONDITIONS…….IE DONE UNDER STERILE CONDITIONS
IF THE BEAKER WAS UNSTERILIZED IT MIGHT HAVE CONTAINED ORGANISMS THAT WERE NOT AT ALL PRESENT IN YOUR URINARY TRACT
YOUR RESULT MIGHT OF COURSE BE FALSE POSITIVE………BUT YOU MIGHT ALSO HAVE THE BUGS IN THE UNSTERILIZED BEAKER TOO.LOL
Georgie now you are being unscientific.
False positive indicates that I would have had another test to confirm the first result. And that other corroborating tests would have been done. You must use this blog as an educating opportunity George. LOL
Thanks Bernard, the point is at the time of sale a scientific approach is taken to determine price. If the ROI and other financial measures are achieved is another point.
@ Hal
The art is in choosing the correct tool for the purpose ,the time and the space. We ,economists have a tool box filled with different models. The competent economists use the tools based on assumptions nearest to the economic realities. The latter changes as Georgie pointed out above.
I answered your question simply Sir
re False positive indicates that I would have had another test to confirm the first result.
I LEARNED THIS AS FAR BACK AS 1972 WHEN I FIRST SAW MY FIRST FALSE POSITIVE
AND THEN NO other corroborating tests wERE done. THE PERSON WITH THE FALSE POSITIVE TEST WAS CALLED UP STAIRS TO THE LAB……….AND WE WERE ABLE TO GET A GOOD IDEA WHY HE HAD SUGAR IN HIS URINE BY TAKING A HISTORY………..HE HAD FEASTED ON FRUIT CAKE THE WHOLE WEEKEND AND THAT MORNING!
RE You must use this blog as an educating opportunity George.
I HAVE DESIRED TO GIVE THAT UP……….. AFTER ALL I GET MY INFO OF THE INTERNET, AND THIS INFO CAN EASILY BE GOT THERE. LET THE PERSON THAT SAID THIS AND THE ONE WHO DEEMED ME IMMATURE WHEN I ASKED A REASONABLE QUESTION TO ONE OF THE ANNOINTED. TO DO THE EDUCATING
IM NOW HERE TO RELIEVE BOREDOM AND TO BE ENTERTAINED
@ Hal
Science is not fool proof. Its litmus test is whether it is replicable or not. While it is easy to do so in the physical sciences of chemistry and physics,we cannot ethically do those experiments with human beings and the society in which humans live. We use statistics which is history quantified. And even then our ideologies determine whether they are facts or not.
BERNARD
I MAY NOT BE AN ECONOMIST BUT I BOUGHT AND MANAGED REAL ESTATE AND ATTENDED MANY REAL ESTATE SEMINARS IN THE 90’S AND I KNOW WHAT ROI MEANS AND I HAVE DONE THE CALCULATIONS
ROI BY DEFINITION DOES NOT FOLLOW THE SCIENTIFIC METHOD AS TAUGHT IN THE SCIENCE TEXTS THAT I HAVE READ
I HAVE GIVEN EXAMPLES ABOVE WHERE USING THIS TOOL IS NOT NECESSARILY FOOL PROOF OR REPRODUCIBLE, AND MY EXAMPLES CAN NOT BE REFUTED
YOU MAY CONTINUE THE EDUCATION KIND SIR
I AM NOT AN ECONOMIST BUT I TRY TO FOLLOW THE SCIENTIFIC METHOD
Bernard Codrington February 21, 2018 at 11:32 AM #
@ Hal
Science is not fool proof. Its litmus test is whether it is replicable or not.
EXACTLY…….WHETHER REPLICABLE OR NOT IS THE KEY WORD IN THE DEFINITION!
AND CALCULATIONS OF ROI ARE NOT REPLICABLE.
ROI’S ONLY SUGGESTS TO THE INVESTOR IF AN INVESTMENT SHOULD BE VIABLE
IT IS NOT SCIENTIFIC BY DEFINITION
AND AS MANY HAVE FOUND OUT TO THEIR PERIL ROI’S CAN NOT ACCOUNT FOR THE VARIABLES THAT ARE UNKNOWN TO THE INVESTOR AT THE TIME, OR THAT MIGHT OCCUR AFTER THE INVESTMENT HAS BEEN MADE
Georgie Porgie at 11 :33 AM
Georgie Porgie, you came on BU to have fun.
My retorts may have appeared to you to be put downs. That was not my intention. I too find fun in the cut and thrusts of the submissions. So please relax. I do not expect you to be an economist and I hope I did not attempt to pass myself off as a Medical Practitioner. So relax.
ROI is usually expressed as a percentage and is typically used for personal financial decisions, to compare a company’s profitability or to compare the efficiency of different investments. The return on investment formula is: ROI = (Net Profit / Cost of Investment) x 100.
Bernard Codrington February 21, 2018 at 11:32 AM #
I do not want to re-invent the wheel. As I have pointed out, the conventions are that maths are linear, once discovered it remains the same; in science this is not the case. Science is always regarded as the state of knowledge, until another experiment comes along to overthrow it (Copernicus, Galileo, Isaac Newton, Einstein, t al) Scientists once taught the earth was flat.
I suggest you read Thomas Kuhn’s The Structure of Scientific Revolution, and Karl Popper’s Conjectures and Refutations for analyses of paradigm shifts in science.
We have had a number of great scientific discoveries (penicillin, saccharin, Teflon, etc) which came about through unexpected discoveries; in mathematics you cannot do that; calculations do not come about by chance.
You talk about physics and chemistry, the natural sciences, that is why I say economics is not a science, even if mathematicians have tried since the 1930s to turn it in to one.
The outcome, as you well now, is that so-called econometrics have gone on its jolly way totally oblivious to what is happening in real economies – giving rise to the birth of applied economics. There is no way of scientifically testing economic ideas as if in a laboratory (remember the 364 economists who in 1981 wrote a letter to the Times challenging Margaret Thatcher’s Budget? You would not get that with physicists or nuclear scientists). Pick any debate you like: monetarists versus neoKeynesians, for example, where is the ‘science’ in the arguments?
I hope we are not going to repeat those debates held by much sharper minds than yours and mine.
Georgie at 12 : 10 PM
Good. Mission accomplished.
Georgie Porgie February 21, 2018 at 12:21 PM #
I really appreciate your advice, but I try to look beyond BU to the wider Bajan public. I am also a born contrarian and dislike the mob. I am not an organisation man. But thanks, again.
@Frustrated Businessman: Animal Farm sequel playing out in Bim. February 20, 2018 at 11:12 AM “DLP gov’t graft is widely discussed in local and foreign business circles with supporting whattsapp and e-mail messages circulated among colleagues.”
You mean that the political class is so brazen as to solicit graft in writing?
@Georgie Porgie February 21, 2018 at 1:08 PM “HOW MANY HERE HAVE CHANGED ANYTHING IN BARBADOS OR ANYWHERE ELSE?.”
Matthew 6:4 “But when you give to the needy, do not let your left hand know what your right hand is doing, so that your giving may be in secret. And your Father, who sees what is done in secret, will reward you. And when you pray, do not be like the hypocrites. For they love to pray standing in the synagogues and on the street corners to be seen by men. Truly I tell you, they already have their reward.”
@Georgie Porgie February 21, 2018 at 1:08 PM “WE HAD TWO GREAT BIBLE EXPOSITORS HERE WHO WERE RUN OFF.”
They were not run off. They chose to leave. Soft men.
Georgie Porgie February 21, 2018 at 1:08 PM #
Again wise words, which are very much appreciated.
I am not here looking for validation of any kind, or a job with any organisation, so the loud mouths and those who have never had to work in the real world pick a fight with the wrong guy.
Like you, I am a Bajan, and I have had the rum shop experience. I have had an enjoyable working life in my chosen trade, and was head hunted for many of my positions, so somebody needed me. So, it is water off a duck’s back.
Dr. Simple Simon at 1 :24 PM
Are you sure you are not a real Ph D? If it were in my power ,I would give you a DD. Your quotation is very apt….. even if applies to me. LOL.
RE @Georgie Porgie February 21, 2018 at 1:08 PM “WE HAD TWO GREAT BIBLE EXPOSITORS HERE WHO WERE RUN OFF.”
They were not run off. They chose to leave. Soft men.
IF YOU RUN OFF YOU ARE SOFT? I DOUBT IT! THEY PROBABLY HAVE SOMETHING BETTER TO DO WITH THEIR TIME………UNLIKE ME.
WHAT IS THE POINT OF YOUR QUOTATION FROM MATHEW?
HOW ARE YOU ABLE TO MISQUOTE THE SCRIPTURE AND I AM NOT ABLE TO QUOTE IT?
SURELY THAT IS NOT WHAT THE LORD CALLED RIGHTEOUS JUDGEMENT IN JOHN 7
Hal Austin February 21, 2018 at 1:28 PM #
I DO UNDERSTAND YOU…………DO LIKE JOHN …….SAY WHAT YOU HAVE TO SAY AND RUN THEM RAGGED!
REMEMBER THAT THEIR AD HOMINEMS ARE THE ZENITH OF THEIR ABILITY! THAT IS WHAT I HAVE COME TO REALIZE
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Hal I know a guy who sold a 100 unit building for a dollar and the reason was simple, he had written off the property against taxes for so many years that there was no value there
lawson February 21, 2018 at 6:44 PM #
Absolutely. Valuation is like the curate’s egg. Some time ago an Eastern European woman bought a house in what we call Millionaire’s Row; I think the asking price was £7m, but, she claimed, she liked it so much she offered a couple million over the asking price.
We also have a foreign owner of a football club who rumour has it would go in to the dressing room after every victory and give the players a bonus of £50000 – these were players many of whom were earning a six-figure sum every week. He did so until ordered to stop by the Football Association.
It is fine reading a book about these things, but something else in the real world.