est. 2007

Barbados Underground

Bringing News and Opinions to the People

National Meeting Hand

Submitted by Tee White If it’s now going to be ‘national meeting hand’, then obviously the first principle would have to be that it’s voluntary. I have never heard of a meeting hand where you have to be in it even if you don’t want to. If individual public sector workers choose to accept the…

, ,

Submitted by Tee White

If it’s now going to be ‘national meeting hand’, then obviously the first principle would have to be that it’s voluntary. I have never heard of a meeting hand where you have to be in it even if you don’t want to. If individual public sector workers choose to accept the government bonds on that basis, then that’s their choice. If however, any individual is forced to be part of the ‘national meeting hand’, whether by the union leadership or government, then it’s not a meeting hand at all.

The government is persisting with this idea, claiming that its aim is to “carry as many Barbadians as possible”. But there’s a simpler and much fairer way to “carry as many Barbadians as possible”. That is that those who have benefited the most over the last 6 decades from turning the island from a sugar cane plantation into a one legged tourism economy must put their hands in their pockets and put some money on the table now that the wheels have come off the donkey cart that they, and the politicians they paid for, built to serve their own interests and which has now got the entire country in a predicament. They’ve become multi-millionaires and billionaires by changing agricultural land into residential land and selling it to developers, by signing lucrative contracts with the government to manage government owned hotels, by linking up with foreign tour operators and in a million other ways. They have full their belly for the last 60 years and now the bill has arrived, they want to pass it to the workers to pay. No way!

A special Covid 19 tax on those with deep pockets should provide the government with all the funds it needs. Remember if you tax a billionaire at 99% of their wealth, they would still be a multi-millionaire at the end of it. They still wouldn’t have to worry about where their next meal is coming from, how to pay their rent or  water or electricity bill.  That’s the way to “carry as many Barbadians as possible”.

https://barbadostoday.bb/2020/05/26/govt-signals-shift-from-forced-to-cooperative-savings/?unapproved=673434&moderation-hash=7f0f8d4337e5dcb6d1bf4a53d7a8055c#comment-673434

401 responses to “National Meeting Hand”

  1. Greene Avatar
    Greene

    okay i will await to see the details.

    but at first blush, it looks to me like the worker has to allocate some % of salary to bonds. afterward the worker can indicate if all or a portion is to converted to cash and then must wait until the % is sold by the Central Bank.

    if true, this is an unnecessary complication.

  2. David Avatar
    David

    @Greene

    There is no wait if the worker wants to sell, the central bank will buy the bond and sell in a secondary market to buyers registered on an exchange managed by central bank they hope to develop.

  3. Greene Avatar
    Greene

    ok so i was right, the worker has to allocate or rather some % of the worker’s salary will be allocated to bonds. afterward the worker can indicate if all or a portion is to be converted to cash.

    that is the only way this would make any sense.

    the option is really an illusion and comes after point of sale. if the central bank doesnt get them sell isnt that like printing money?

  4. David Avatar
    David

    According to the good doctor they are creating fiscal space by reducing current/payroll expenditure to be able to divert savings to capital works because the redemption of bonds is a deferred cost. Hopefully one of the more intelligent BU family members can break in down for you.

    >

  5. Greene Avatar
    Greene

    David,

    ok …will look forward to that -lol

  6. WURA-War-on-U Avatar
    WURA-War-on-U

    “You can’t win ’em all.”

    Nope you can’t.

    we can only focus on not leaving a corrupt/slave society to our future generations or they will judge us very harshly….and wonder why we were we so WEAK that we allowed it to continue because we really had no choice or were even aware growing up that this is what these scum for black face leaders were doing to their own people.

  7. Disgusting Lies and Propaganda TV Avatar
    Disgusting Lies and Propaganda TV

    I ain’t seeing the Kool Kid today i wonder what happened????? lol….But seriously in my OPINION the BOSS program is ingeniousness. I’m even more heartened that a “true Bajan” devised it. It is playing on NORMAL RATIONAL behavior for people to save until they can’t save any more and for people to make money wherever they can. It is, by design naturally biased to the higher paid worker that COULD save in the first place but it allows and promotes lower paid workers to save. It basically takes advantage of savings that workers would make anyhow but offering a better alternative to savings accounts. Since the bonds are partially tradable it makes them even more useful. The banks are somewhat “in trouble” and they SHOULD BE because it takes some of that liquidity from them. Basically it has the potential to “tek money from foreign owned banks and let it work for all Bajans because all dem banks does do is put foolish fees on yuh account” i heard Dr. Greenidge on Brass tacks said that govt was devising a similar instrument for the private sector which i think would be attractive to them. By using it, Govt saves on it wage bill (an expenditure) in the SHORT-TERM but the bond holder gets something down the road and looses nothing. It is supposed to last 18 months but i suspect it will go beyond because that time frame due to worker demand. There is no cut or burden to the public workers as Ms Deluded wanted to imply on Brass Tacks. I think that the Workers Unions would be sold to this idea as it a far better alternative to “pay cuts” and it is designed to be SHORT-TERM.

  8. Critical Analyzer Avatar
    Critical Analyzer

    @Greene

    Basically the government does not want to pay out all that cash money in salary and have decided to pay the public workers part cash and part IOU. The IOU is taking the form of a bond which in essence states “I, the government will pay you all the outstanding salary I owe you in 4 years but pay you 2.5% interest every six months.”

    If a public worker is unwilling to wait the 4 years to cash in the IOU, you can tell the government and they will sell your IOU(bond) to the Central Bank where they will then turnaround and sell on the open market to any person or business that trusts the promise of the IOU(bond) and is willing to accept the risk.

    So if you as a public worker are in a position where you can afford to do without a part of your salary for the next few years or are accustomed saving something each month, you can decide if you trust the government’s IOU enough to accept the bond offer since there are no higher interest bearing investments available.

    Additionally, anyone who has money sitting on the bank and if you think the bond is a safe investment, they can go to the Central Bank and buy bonds the public workers refused for cash are made available when the Central Bank

  9. Critical Analyzer Avatar
    Critical Analyzer

    @Disgusting Lies and Propaganda TV May 29, 2020 3:16 PM

    I agree with you. It is pure genius. Only a Bajan could have come up with that. It gives me hope that we still have some bajans that can come up with sensible things.

    It immediately reduces the wage bill making the balance sheet look great, gives them access to the so called liquidity in the market and more breathing room for the next six months until we have a better handle on the fallout from the COVID situation.

    The only caveats is if the government can engender the necessary trust in the strength of bond to make the second bond market and if they can recover within 4 years to honour the bonds.

    If only they would put some of that ingenuity and sweat equity into the agricultural sector so we can feed ourselves and save some foreign exchange.

  10. Dullard Avatar
    Dullard

    @Blogmaster

    Do you know if there is a published prospectus of this bond issue. i’d like to take a proper look at the numbers.

  11. Greene Avatar
    Greene

    @CA,

    i have no issues understanding the bond idea.

    i never ask a question to which i dont know or likely have an idea of the answer -lol

    the problem with the opt out is that if all or a majority of workers opt for cash the Central Bank will end up with the bonds until they are sold, which is like offering the bonds to certain members of the public with civil and public servants given the first choice to buy

  12. David Avatar
    David

    @Dullard

    We are not there yet, here is what we know. Click the hyperlink to BOSS.

    https://gisbarbados.gov.bb/blog/government-proposes-b-o-s-s-programme/

  13. Khaleel Kothdiwala Avatar
    Khaleel Kothdiwala

    @DLP TV

    Two things:
    I was genuinely interested in seeing how persons would try to spin this brilliant proposal.
    Dr Greenidge et al have spoken well to the matter and there is nothing more for me to add. Unlike some I only comment when I have something substantial to contribute.

    I need not address Millie’s piffle as Enuff deftly decimated the little guy so I’ll leave him today.

    All Caps has not been informed that while another debt restructuring is not foreseeable at this time, these bonds will be immunised regardless from any future debt restructuring as unlikely as that is.

    The eagle asks some interesting questions. He should apply himself to availing himself of the available information before commenting.

    +++++++++++++++++++++
    @Donna
    I don’t recall naming you as a member of the DtM brigade. I will leave the list making to Robert lol. But me thinks that if the lady doth protest so much, does the cap fit?
    +++++++++++++++++++++

    So I will continue to spectate at the world’s biggest piffle show and drop in a word occasionally.

  14. Disgusting Lies and Propaganda TV Avatar
    Disgusting Lies and Propaganda TV

    @Khaleel ok ..it is good to “tune out” from the constant annoying “noise” here..lol

    @Analyzer that is risk inherent in any investment. Even if people put their money in a shoe box there is risk (albeit minimal) that the house burns down, a flood comes or fowls “cahing it away” lolol. But the govt through BERT was making a platform for strengthening investment in Bdos on the whole via bonds. The credit ratings were moving upwards before COVID-19 but we will see in time.

  15. John A Avatar
    John A

    Well after all the party folks had their say let’s ask a few questions.

    I heard today Mr Greenidge arguing that the workers have received no wage cut with what is being proposed with the bonds.

    Technically you could argue that but what should have been said is that the workers will be receiving a fall in physical liquidity. In other words let’s say you worked for $4000 a month and got $3500 in hand, you will now pay the same tax but get say $3000 in hand. The bond may work with those who are fortunate enough to have excess liquidity monthly, but in today’s economy they would be few and far between.

    The arguement that this is a form of savings is true, but this can only work for those who had a few hundred dollars a month left back after their monthly bills were paid. For those that can’t do that, this plan would see them falling into debt every month by the value of their bond contribution.

    In summary some may get 5% interest on their bond, but end up paying 21% on their credit card in the form of interest, as they can’t clear their card balance anymore due to a shortfall in monthly cashflow. In other words if taking the bonds to get the 5% means running debt at say 12%, wunna losing money monthly in real terms.

    Never judge a book by the cover, try to at least read the first few chapters at a minimum.

  16. NorthernObserver Avatar
    NorthernObserver

    @JohnA
    In BOSS, the O=Optional. If for whatever reason, the employee take home = expenses, they ‘opt out’ and never use their CC/loan.
    What we do not know, is if BOSS fails to raise the ‘forecasted amont’, what is the next step?

  17. Tron Avatar
    Tron

    The BOSS hammer will strike very effectively. There are informal ways to do this. We need a whip in all offices who psychologically “convinces” those who say NO until the they “voluntarily” say YES to the government bonds.

    Then the constitution will be formally upheld, but we will get our salary cut – because the repayment will be AFTER the next elections.

    Nevertheless, I recommend that Senator Caswell be promoted to ambassador in New York. Thompson is obviously an unfit crybaby. Let her take care of her mom for years, but not on the government’s dime. The Senator will be able to enjoy the second wave of the pandemic at first hand, since he has many hands to shake at his inauguration.

    So we see how important it is to push people back and forth like chess pieces.

  18. Critical Analyzer Avatar
    Critical Analyzer

    There is no scenario where government does not raise the money because they are not raising money. Government has decided to keep some of the money they would have paid you on the bank by paying you in cash and bonds.

    The option comes in for people who want cash immediately where government has made an arrangement with the Central Bank to immediately and transparently purchase the bonds for those employees wanting immediate cash. The Central Bank will then put the unwanted bonds they purchased up on a secondary market to recoup their money.

    The elephant in the room is if the market believes government will be able to get the economy back on track and be in a position to honour the bonds in 4 years.

    The brilliance of the scheme is government does not have to waste one second trying to peddle bonds locally or internationally to get all the money they need. I also suspect there will be substantial appetite for those bonds when they come on the secondary market and if there is none, all they have to do is manage the economy over the next few months and the appetite will increase substantially.

    I would not be surprised if some other countries in Barbados’ predicament adopt a similar program to create fiscal space.

  19. Enuff Avatar
    Enuff

    The government may once again prove that it is superior (in terms of developing responses to difficult situations) to the last DLP administration and the current opposition parties. I am no finance and economic guru, but the line of work I am in always calls for killing as many birds as possible with one stone. Or as many Salemites as possible with one post.🤣🤣

    We have an economy ravaged by COVID and as such public and private sector employees are facing job uncertainty. We also have old infrastructure in need of repair or replacement as well as a need for new infrastructure. However, we also have savings accounts flushed with cash collecting less than 1% interest. Rather than send home more workers or cut their salary, the government is offering voluntary, flexible, tradeable bonds as part of public workers’ monthly income. The money saved from worker buy-in or sale of those bonds, allows government to undertake capital works projects to stimulate growth (private sector jobs, goods and services) while at the same time upgrade (or establish) social, green and hard infrastructure–schools, roads, reservoirs, solar energy, parks, water mains, sewerage, government buildings etc. So one BOSS move could in effect save and create public and private sector employment; facilitate Barbadian investment in Barbados’ infrastructure; inculcate an investment mindset in B’dos by simplifying and broadening access to investment opportunities; provide better returns for Bajans than the less than 1% the banks are paying; upgrade all forms of infrastructure; stimulate the economy; and, promote equality and access for all to investment opportunities. Taken as a whole, the BOSS embodies the objectives of sustainable development. The consultants may once again prove their worth? Not only for the BOSS, but just imagine where we would be if the debt restructure wasn’t undertaken or ended in tears, as prophesied by some?

  20. Enuff Avatar
    Enuff

    The attempt to liken the BOSS to Sandiford’s 8% cut is grasping. Voluntary v involuntary; investment v total loss.

    I have one word to throw in the mix: CONFIDENCE.

  21. Miller Avatar
    Miller

    @ Enuff May 30, 2020 6:34 AM

    Your analysis is good but flawed in one major area.

    For every dollar spent- either by way of private sector investment or by way of taxes collected or debt incurred by the government- an estimated 80% finds itself converted to foreign currency and remitted overseas to pay for the large list of imported goods and services.

    You have not addressed this missing link. The existing foreign reserves cannot support such additional expenditure.

    It has been borrowed from the IMF to shore up the country’s balance of payments to pay for its food imports and other items like medicines and oil (which fortunately has dropped in price for the time being).

    It also has to ‘reserve’ a certain level of ‘liquid’ forex to meet its overseas expenditures like the upkeep of its many overseas missions, membership subscriptions to the many organizations and, most importantly, its foreign debt obligations, albeit restructured.

    Do not look to the tourism industry (which is in the ICU) to generate any meaningful amounts of forex or tax revenues in the near future.

    Where is your FDI in this mix?

    The country requires foreign financing to support the kind of expenditures you are expecting to be undertaken by the government.

    Who is going to provide those much needed loans to finance the forex portion of your capex proposals?

    The IMF which, btw, hardly lends money for infrastructural projects?

    The World Bank or the CDB?

    What about the Chinese or the Saudis?

    BTW, don’t you think the government can help itself a great deal by improving its tax collection efforts?

    Do you know of any areas where government can collect what is due to them?

    Or do want us to remind you of some?

  22. John A Avatar
    John A

    @ Northern

    I figure what ever the workers don’t take up the private sector will buy. I don’t see them having a problem moving them. In the public sector though it remains to be seen how they and the unions will take it.

  23. William Skinner Avatar
    William Skinner

    We need to reach a level of national maturity. I support BOSS. Any program that drives Black citizens toward investment should be at least given a chance.
    I also supported the NSRL because it was a genuine attempt to get the private sector to pay up front. Unfortunately some people are only nationalistic when their party is in power.
    Therefore both the NSRL and BOSS can be given some credit for creativity. We need to continue seeing this period as one that calls for intellectual maturity.
    In terms of the eight percent Sandiford cut I marched up and down against it. I was also critical of Sherbourne being built. Sherbourne turned out to be a great investment.
    The eight percent is thought to have saved the country from devaluation.
    It’s better to use our creativity with efforts such as BOSS and NSRL and fail rather than run to the IMF and end up in it like Jamaica for four decades.
    The only persons who will stop Mottley and company from achieving any positive results are the party sycophants who don’t want anybody to question or be critical of her policies.
    Let’s give BOSS a fair try. It’s a step in the right direction.

  24. Enuff Avatar
    Enuff

    The NSRL was nationalistic in name only. I fail to see the comparison with BOSS.

  25. John A Avatar
    John A

    @ William

    I don’t agree with you on the NSRL as all it did was push inflation. Had the government then collected the vat that was due to them the NSRL would of been unnecessary. If you look at the years the $500M in debt forgiveness covered, you will see much of it was for years prior to the NSRL being introduced.

    As for the BOSS I have no problem with it in principle, but the bonds should have been launched on the open market and following is why I say so. Had that been done all could of bought and there would of been no need to fluster the civil service and unions on this matter. I mean what’s the difference in a civil servant buying a bond or a private person buying the said bond and then government using that money to pay the civil servant? Absolutely nothing. After all either way they gone back printing money so why does it matter who buys the bond?

    It was a good idea buy badly marketed that’s all.

  26. Enuff Avatar
    Enuff

    Miller
    Firstly, we don’t have 3 weeks of import cover. Secondly, fuel prices are waaaaay down, tourism on pause, shopping trips to Miami and New York on pause and many other areas that eat into FOREX. What percentage of the inputs into construction is imported? With little demand for such inputs from private businesses or individuals, will there be any marked increase in demand for these inputs? I don’t think the people that crafted BOSS are asleep.

  27. David Avatar
    David

    @John A

    From what has been said the public will be able to buy the bonds redeemed by public sector workers on the secondary market. Also there is talk about creating a National Pandemic Bond for the wider public.

    On Sat, May 30, 2020 at 1:33 PM Barbados Underground wrote:

    >

  28. Greene Avatar
    Greene

    quote] Referring to it as a “BOSS hog plan” Franklyn warned that it would be ill advised to “trust Government paper” considering what happened during the last restructuring exercise.

    Furthermore, he argued that Government did not have the right to pay public servants with bonds as it was illegal to do so.

    He said the law outlined that public servants must be paid in legal tender, which bonds were not.

    Franklyn accused Government of forcing workers to take the bonds.

    “You are forcing people to do something and saying they can volunteer. They are not volunteering because it is not optional and they cannot do that. You cannot require them to take their monies. It is criminal to do so and an employer who does that breaches the law and could face the courts for it,” he said.

    “…You cannot cut their salaries and you must pay them in legal tender. The law says you must pay salaries in legal tender and legal tender is money, so you cannot give me a bond because a bond is not legal tender. [unquote

    https://barbadostoday.bb/2020/05/30/scheme-illegal-claims-opposition/

    CS does have a way of getting directly to the meat pf the matter- lol

  29. William Skinner Avatar
    William Skinner

    @ John A
    Fair comment. I don’t agree the NSRL caused an increase in inflation.
    @ Enuff
    I don’t where I attempted to compare NSRL with BOSS. I merely said that there are both creative initiatives. I would have to be a complete idiot to compare them as likes. I just said
    there were “ creative”.
    I say a man built a creative boat. Another man built a creative house. Am I saying a boat is a house or Vice versa ?

    William Skinner said:

    “Therefore both the NSRL and BOSS can be given some credit for creativity.”

  30. Greene Avatar
    Greene

    from Verla-

    quote] She said: “It is a ‘boss’ move, but still a pay cut. And it is not fair and reasonable for public servants to bear this burden alone. If the bonds are truly such an excellent bargain, open up the issue to all comers. And in any event, public servants will warm to the concept more once they learn that the ministers, consultants and MPs will not be opting out of the bond issue.”

    The DLP president was responding to the details of the Government’s most recent economic plan, which promises to save both public and private sector jobs by diverting a percentage of the salaries of government employees into capital works projects…….

    The Government’s senior economic advisor Dr Kevin Greenidge promised that employees who could not afford further salary deductions would be allowed to opt out of the bonds, which could be bought by any other private citizen or business.

    But DePeiza argued: “Dr Greenidge gave the ‘out’ for public servants when he stated that it does not matter if one opts for the bonds or not, a bond will be issued in each case. If you choose not to take the bonds, the government will still issue the bonds but pay you your cash and it becomes as if you had traded them to the Central Bank of Barbados. They get their bond issue anyway.

    “The books reflect that a salary reduction has taken place, when in reality the salary potentially remains the same, but is recorded in two separate line items. And think about it: if the bond issue is so great why is it not pitched to the business and banking classes, or even the wider public? Why are the contractors not being paid in bonds at least in part?” [ unquote

    https://barbadostoday.bb/2020/05/30/dlp-blanks-boss/

    v interesting

  31. Miller Avatar
    Miller

    @ Enuff May 30, 2020 9:36 AM

    How many weeks of import cover do you have since Coivd19 knocked out the tourism forex-earning cylinder?

    If you really believe that construction projects do not ‘consume and involve’ large components of forex then you are living in a closed economy called La la Land.

    Barbados is not the USA or China or even T&T?

    Why don’t you look in your own house in Bim and see what items (including construction materials) are imported compared to those manufactured locally; even if it is your wont to exclude the inputs of imported raw materials.

    Where is the foreign money going to come from with the tourism top-up pipeline now shut off?

    Now here is what you have on your list of projects which can be undertaken from the cost savings to be accrued from the “BOSS” plan which, on the face of it, can go a long way in reducing the conspicuous consumption of imported luxury goods and unneeded services.
    +++++++++++++++++++++++++++++++++++++++++++++
    “The money saved from worker buy-in or sale of those bonds, allows government to undertake capital works projects to stimulate growth (private sector jobs, goods and services) while at the same time upgrade (or establish) social, green and hard infrastructure–schools, roads, reservoirs, solar energy, parks, water mains, sewerage, government buildings etc.”
    ++++++++++++++++++++++++++++++++++++++++++++++++

    BTW, we have noticed you have ‘graduated’ from being a top-notch PR consultant and sitting in the chair of committees of multi-national agencies in NYC to a guru of economics and finance in Bim qualified “Enuff” to put the affected-speaking professor in bullshitery out of business in the red club of hangers-on.

  32. John A Avatar
    John A

    @David.

    I think they have confused things a bit when they didn’t need to. What I would of done is offered the civil servants the bonds at a discount rate and at the same time offer the said bonds to the public at full market rate. That way civil servants could even of made a few dollars right away be selling their bonds to the secondary owner and the MOF wouldn t of had to wait to see whom was taking up what, then to try and offer what was left to the secondary market. She would of collected payment for the full bond offer way quicker. It would also of put some money into the economy by the civil servant selling on the bond and being liquid by the value of the spread.

    Now while all this is another form of printing money, I believe there is room where we are now financially to print a controlled amount, providing they don’t go overboard and create another Sinkyuh scenario.

  33. TheOGazerts Avatar
    TheOGazerts

    Hi John A
    This bread and butter guy has a few simple questions for you
    (1) Since it is optional what happens if no one buys in
    (2) Since the bonds redeemable at anytime, what happens if a large number of folks decided to redeem “immediately”
    (3) Should I opt-in or bury my money under my mattress(bank)?
    Bread and butter reply please.

  34. David Avatar
    David

    Why would public servants opt in and redeem soon after?

    Will the government have the option to tweak the design to react to rate of purchase?

    Is it a good tactic for the government under the cloak of covid to test public confidence in government paper?

  35. John A Avatar
    John A

    @Theo

    The one question you should ask yourself first is are you comfortable that the government will offer the 5% untouched and honour it in the 4 years? I would think they would as they couldn’t risk to default on these bonds too, as no one would ever buy government paper again.

    So once you are comfortable with the above I see no shortage of secondary buyers for these bonds. I can tell you I know several in the private sector who are registering with the central bank to buy any that’s left. Plus the risk is lower as it’s short term debt and not a 20 year bond.

    I am sure the MOF will sell the offering easily from what I have heard from private sector persons. Also many with money along with seeing a 5% return, say they can see where the money is going this time and they know we have to get the economy moving to get the 40,000 odd unemployed back to work.

    This offering is totally different to the madness that Sinkyuh was involved in, as it is specific to the survival of all of us on the island post covid.

    So if you were a civil servant and asked me I would say take the offer, as there will be a secondary market based on todays market . Now having said that if the government sells bonds left and right under other names at similar yields, these bonds would not be as attractive on a secondary market, which would of course mean you would have to hold them to maturity.

    If we had an aggressive banking sector they too would be offering to buy on the secondary market, making civil servants more comfortable knowing they could sell the bonds at anytime.

    Discount the bond as I mentioned above to civil servants and open the market to all buyers and watch de bonds move like cold banks beer on Kadooment day. Just don’t flood the bond market with too much paper and water down the value of these bonds that’s all. In other words do not create another Sinkyuh Printorama.

  36. David Avatar
    David

    @John A

    What is the alternative to government trying to foot public sector wages bill?

  37. John A Avatar
    John A

    @Theo

    I think what we will see happening is that government will issue small bond offerings for specific purposes as opposed to a “washpan” of paper being floated, which no one wanted in the past. So unlike Sinkyuh who floated say $200M in bonds that no one wanted. You may see specifict bond offers of no more than $50M at a time this time around. This would be a smarter move as it will ensure demand and supply are allowed to work together in a market driven economy.

    As the Bajans would say ” done right em got my vote.”

  38. John A Avatar
    John A

    @David

    At this stage let’s be honest we can’t lose more to unemployment or the economy will just implode.

    Given our fiscal situation now we have a little room to print bonds and as long as it is done in relation to fiscal balance I support it. What has happened here is that they were launched as forced savings, then something else then changed again.

    They should just of announce a $50M bond offering under the below conditions and done.

    Bond offer in denominations of $1000 or multiples there of at 5% over 5 years paid semi annually.

    Active civil servant will be entitle to a discount on bonds of say 10% and allowed to sell them on the secondary market through an appointed agent. Could be central bank, Fortress whoever.

    Bonds will be limited to purchases of no more than $500,000 by any one individual or entity. Persons or entities buying will need to provide their Tamis number to qualify for the purchase.

    After that open the doors and let the market deal with it. Everyone will get a chance to make money, the civil service will get paid and make a few dollars on the spread if they want and the offering I bet you will be over subscribed if the above is done.

    Oh and the same way you call Mia on her sick bed to send the police for me in the market, call she now and let she send a ham at Xmas for the free advice. I gone fuh now. LOL

  39. TheOGazerts Avatar
    TheOGazerts

    @John A
    In 187 comments only WS mentioned the word devaluation (in a different context).

    I hate the slow trickle of information.
    .
    Can you look into your looking glass and see devaluation (n 4 years) as a possibility?

    Fools (expatriates) may be tempted to nibble. We bread and butter guys want to keep two slices and the butter.

  40. TheOgazerts Avatar
    TheOgazerts

    @David
    Thanks for the PowerPoint.
    Was it always there?
    Just saw it for the first time.
    The video following it is unavailable.

  41. TheOgazerts Avatar
    TheOgazerts

    Very good presentation.
    Easy to understand.

    Pet peeves
    The totals which gives millions or a billion should be rounded to the nearest dollar and not have pennies (included).
    “If same amount was placed in a bank” should have been on the bottom line (we bread and butter guys don’t care only for the bottom line). We want to know what is coming to or escaping from our pockets.

    Excellent presentation..

  42. TheOGazerts Avatar
    TheOGazerts

    🙂 Waiting for Lorenzo and Robert to state “Theo think the presentaion was “made” by Sinckler, a D” 🙂

  43. Disgusting Lies and Propaganda TV Avatar
    Disgusting Lies and Propaganda TV

    Any one that compares BOSS with NSRL CLEARLY does not understand the “economics” and expected behaviors behind both. Firstly NSRL was INFLATIONARY. It put new a tax on businesses. They will, in most cases, NOT absorb it, they pass that on in the form of price increases. All at the same time workers had no pay increase for 8 years before.The NSRL was a desperate cash grap;. THAT WAS ALL IT WAS. The gov’t then was all out of OPTIONS to raise revenue. they were even reduced to selling the family silver (eg Hilton and the BNTCL).For the NSRL to work they SHOULD have deprecated or abolished the VAT.

    BOSS as is gives govt wiggle room for SHORT TERM purposes. The plan is a REACTION to the effects of COVID-19 and not to poor economics. Seeing the world as it is, people are becoming desensitized to COVID-19. People are tired cowering in fear. Countries are doing “Hail Marys” by reopening and HOPING the death tolls do not exponentially rise. With more “opening up” more economic activity is expected. However we still have to go through an upcoming winter season where the effects of COVID-19 are projected to be worse than it is now . What will happen then…will tourists want to “escape” the and come here, will the lockdown comeback in full force???

    Even as designed BOSS is still attracted enough to be a long term plan. ‘mI assuming Dr. Greenidge based it on the current liquidity in banks and taken into account a worst case scenario especially with COVID-19 hurting the economy.
    As i said earlier in this blog it would take the liquidity out of the banks to let it work for govt so that govt can work for the people.

  44. Donna Avatar
    Donna

    I promise that I will invest some thousands in these BOSS bonds. After I see the integrity legislation.

  45. NorthernObserver Avatar
    NorthernObserver

    @JohnA
    You appear to have issue with MS expansion based upon the architect. The NIS is dry. The liquidity lies elsewhere in 2020.
    Lest we forget, using the Catastrophe Fund for unemployment purposes ‘sounds good’, but its value (cash?) has to be unlocked. Or the unemployed will be getting ‘other GoB paper’ in their pay packages.
    Kicking tot down de road?
    The once in 14yr surplus is gone. Task now is to see what funds can be used for beyond the ‘social economy’.
    Nor would I assume ‘causin we default once means we cannot do it again’. It was a ‘soft’ default.

  46. Khaleel Kothdiwala Avatar
    Khaleel Kothdiwala

    Government has attempted to create appetite for the secondary bond market by way of the tradeability of the bonds.

    Government has incentivized them by immunising them from any future debt restructuring, nothing that the debt restructuring was the only time when government paper was not honoured (so that knocks that fear on the head).

    Government attempts to create fiscal space to allow it to drive capital works.

    In an environment where UNCTAD and the OECD project FDI flows globally to decline in the region of 30 to 40 per cent in this fiscal year, investment by local companies becomes more important. While a drop in consumers’ disposable income tends to lead to a rise in interest rates which makes borrowing less attractive, Keynes submits that confidence is a more potent driver of firms’ willingness to invest than interest rates. This is bolstered in an environment where investment managers such as Fortress are actively encouraging firms to invest, and where generally while some companies are experiencing cash flow challenges, confidence is being stimulated.

    Invest Barbados is facing the FDI challenges head on, having been commended by UNCTAD, and is closely following the advisory document for IPAs formulated by UNCTAD after consultation with IPAs across the world.

    These BOSS bonds, at every step of the way, have an ethos of optionality built in. You cannot assert that a person’s salary is being altered to their “disadvantage” as the Constitution disallows, if they acquiesce to it. The enthusiastic support of the NUPW’s General Council goes a long way to putting arguments to the contrary to rest. Regardless, King v AG makes it quite clear that the national interest overrides private property and that is in the instance of a salary cut far less an optional salary deferment. It is quite interesting that the same people who just a few days were decrying what they thought would be a “forced savings” and now take issue with the optionality of it. Absurd!

    The burden is not being placed solely on public sector workers. Dr. Greenidge was quite clear that private sector companies and individual workers can opt in if they wish. Regardless, I was just in the supermarket chatting with a Cabinet member who reminded me that while persons see the same persons being hit time and again, that is not only inaccurate but also when measures are implemented it will invariably affect the most compliant and largest sector of the tax base. So that is only logical.

    At any rate, the “suffering” being requested is far more humane that any alternative. Government could have chosen to select a segment of the public sector and reduced their salaries to $0 by retrenching them. Or they could have chosen to go the route of an across the board salary cut which would firstly not be proportional to the emoluments of the various bands of the Service and secondly would have to hope for some future administration to perhaps pay them back pay. Instead Government has chosen to offer public sector workers to take a stake in the survival process and defer their salaries and at the same time accrue far greater monies than if they saved them elsewhere.

    Ultimately government had pursued the most necessary and least painful of the options before them. I would encourage Barbadians to invest in the bonds, and chose another occasion to pursue partisan ends amd score political agenda items.

  47. Tron Avatar
    Tron

    The whole discussion and the measures taken by the government are evading three points:

    1) Barbados cannot survive without tourism. There will be no viable diversification. Never ever. The only alternative is mass emigration, as the island is totally overpopulated.

    2) The indigenous population does not work hard enough. Productivity is far too low for the exchange rate to the US dollar.

    3) The indigenous population’s expectations of their standard of living are far too high. They want to live like in a developed country, but productivity is far too low.

    Even the best head of government in the world, Mia Mottley, can do nothing against resource poverty and the local culture of relaxing at work.

  48. WURA-War-on-U Avatar
    WURA-War-on-U

    “…You cannot cut their salaries and you must pay them in legal tender. The law says you must pay salaries in legal tender and legal tender is money, so you cannot give me a bond because a bond is not legal tender. [unquote”

    Caswell and others said this from the very beginning, but they are still trying their end run around the labor laws.

    ..the ministers/government don’ t even want to take a pay cut to help the economy nor the people whose VOTES THEY WILL BE BEGGING IN 2023.

    ah want the fowls to come telling me anything i don’t like…

  49. WURA-War-on-U Avatar
    WURA-War-on-U

    And they can REVERSE their BOND SCAM by DECREE at anytime….leaving the civil servants to sink with no life jackets….just as what they did to the PENSIONERS .. and telling an 85 year old man he has to live 15 more years to get back some of his money..

    ….just like when they decided in the last 25 years to ABSOLUTELY REFUSE, both governments,…to COLLECT 1 BILLION DOLLARS IN VAT already paid at point of sale and the property of the PEOPLE …they wrote it off and let the VAT THIEVES walk free…..now the people and island are SINKING…no life jackets.

  50. NorthernObserver Avatar
    NorthernObserver

    @Tron
    The one ‘obvious’ you elude, is why the GoB did not factor/sell off its VAT receivables, instead of ‘righting them off’. (sp. int) They may even have created a new Investment vehicle…ABCP, by some catchy new acronym of course. They could even have created a new ‘Financial Court’ to deal with expected litigation, which would create work for their lawyer buddies.

Older Comments
1 2 3 4 5 6 … 9
Newer Comments

Leave a Reply to NorthernObserverCancel reply

Trending

Discover more from Barbados Underground

Subscribe now to keep reading and get access to the full archive.

Continue reading