The Book Is Worn And Tattered, But Let's Turn Another Page: Good Bye To This Decade

Decades come and go every year, but we save the special hoopla for the years that end in 9 and the years that start with 0. I should have spent more than a few days of the Christmas holiday ruminating about what has happened over the past 10 years, but I really did not except in the most natural and fleeting of ways.

I look at my Dad, now in his eight decade and wonder how much of his time he remembers and still enjoys. As he talks, with no sense of time ending, he drifts from boyhood, through manhood; through marriage; through childbirths; through work; through deaths. It's all been a lot and it's not over yet.

I look at my in-laws, themselves into their seventh decade. One has a new knee so may be able to run for another 70 years. They've celebrated 5 decades of marriage, and have one child to represent each decade. Their grand children range from less than half a decade to just over two.

I look at my children: one has seen two decades, the other just over half of one.

We all talk about times past and history merges with the present to make a glue that will pass through our lives for centuries. When we sit at meals and can see three generations around the table that is a wonderful measure of what the decades mean.

When those of us in our middle years try to stay up with the spring chickens in the fold, we can only turn back the clock slowly. When the young ones bounce back ready to go again, we are searching for embrocation and ice--not for our drinks. We older ones sleep in the middle of the day, just like the younger ones: we all need our energy recharged. While they rise slowly from their slumber, we get ready for another set of tasks. They watch and learn that this will be their role one day. We share what we know and what we do, in play, in cooking, in speech, in behaviour, in worship, in all things good.

We are not able to understand what has changed for the worse in the world in which we live. Many aspects of life seem so much easier now than decades ago. Water runs through pipes into all parts of the home, not just to a stand pipe in the yard or down the lane. We can cook on gas and not have to rely on log wood. We pickle through choice, not through need. We can freeze and keep things cold, without having to wait for a truck to deliver blocks of ice. We can shop as if it is a routine part of life rather than a set of special events. We can imagine studies in the finest of schools and universities, without wondering if we are fit to even say their names. We can dream of leading our countries and their institutions, even if we are from families that no one knows. Our girls and women are at least equals with any boy or man, and wont let them forget that.

Through luck and diligence and the choices picked along various paths, we have not ended up as villains on this Earth. We don't beat up and rob people. We don't throw our garbage all over the place. We try to show respect and compassion for other people. We give of what we have, as freely as we can. We accept others' offerings, but understand that not all are fortunate.

We are strangers in strange lands, and sitting prettily at home in the lands where we are born. We travel to places whose names many cannot pronounce. We eat food that used to be available only to the rich and famous. But, we love our simple and local fare too--maybe even more. We have our herbal medicines for every sickness, and want to know our doctor as someone we know and trust, and remember growing up in our town.

We are simple people and strange for being so. We are people of the Caribbean, with its mixture of shades and racial backgrounds. We are proud to have been born in this blessed realm, no matter what horrors preceded us and befell our ancestors.

Decades come and decades go. What we take forward each year does not really change that much, but we build on what we have, and like the rings of a tree shows its age, the layers we add each year are our strength. So, here's to building another layer and to gaining more strength.

Have a blessed and wonderful New Year in 2010.

New Kid On The Blog: BarbadosAllegiance

In the space that exists for blogs originating in, or focusing on, Barbados. it's good to see what appears to be a new, bold venture: a blog that purports to be for non-partisan political dialogue. BarbadosAllegiance began last week and can be found at http://barbadosallegiance.wordpress.com. It's message is about allegiance and pushing Barbados political thought and action. I wish them well.

However, as I have experienced, the issue in Barbados is not whether or not you really are non-partisan, but is how people perceive you to be. I am non-partisan and have no vote; I have no particular axes to grind, but am very keen on pushing issues, yet I am branded partisan, even with the most absurd of logic. So, the new bloggers should try to dig their furrow and see how straight it can be. If their arguments are good and touch on a particular party and/or its adherents, then they should be ready for attacks from them. If they have facts to back up their arguments then they should stand the test of time and of criticism, but those elements are no real shield should anyone wish to viciously go after the authors.

I'm sure the usual array of party faithful, parading under a range of pseudonyms, are licking their lips after downing their turkey and ham and are chomping on the bit ready to get a taste of the new meat on offer.

I find it interesting that the first few posts touch on corruption, and the argument that this is more a part of 'normal' life in Barbados than would appear to be the case from the rosy image coming from Transparency International. There are some very obvious instances that one can see all around. There are the more covert aspects, about which people may not want to say more--and the regular media have been very leery of touching, being pushed away by 'libel chill'. But, these things cannot stay hidden for long, and they also have their way of coming to light when least expected.

I am personally not in favour of anonymity for bloggers because it casts suspicion on the provider, and it’s been shown to be less effective than visibility. So, I hope the new kids on the blog will have the courage to stand up and be seen. If they claim to be non-partisan they stand a better chance of that label being seen to be true if it is known who they are. Also, one cannot seek the defence of others if you are not prepared to stand us a who you are. It’s a Bajan Catch 22, but (to mix metaphors), you have to unravel the knots not tie more.

The Crime Of Crime

No one truly understands why violent crimes have risen so fast in Caribbean countries. The reasons are not singular. We understand that a part of the core reason is a desire to get richer quicker and that crime seems to pay, at least for some. We know of the drug trafficking connection in Jamaica. We know of the political turf wars there too. We know of the kidnapping and ransoms in Trinidad. We know of the domestic violence that spills blood and takes lives. We know of people who cannot get work and find things to do that idleness permits. We know of youths (not just men) who have become disaffected from the societies in which they live and see nothing wrong with taking a life to correct even petty wrongs. We know of venal policemen and legals systems that do not give justice. We know of fractured families and fractured lives. We know of churches that spend more time and energy getting money from parishioners and filling the pockets of so-called 'men of God' rather than saving any souls or turning around any lives.

Many bay for more police, and heavier sentences, and death penalties. But we know those are not solutions, and even if you had one policeman for every citizen, crime would still exist. Executing every murderer will not stop another killer. We have had centuries of fractured families, even prescribed as the norm for our slave ancestors. So, will 'rebuilding' families mean that much? We have lots many of the social roots that curbed crime, whether it was small communities, or a sense of neighbourliness that meant that no one shielded those who sought to exploit others. Was urbanization the real spark for major problems? Was easier travel the spark? Were images of free and easy looking wealth that was just across the water the spark? All of the above in some measure?

But we are facing different pressures and have not solved how to deal with those and stay on a path that does not encourage villany. Some with plenty insist on having more. For what? Few with much give to thiose with little or none. Few politicians can speak to the concerns of the majority and have little that resounds with the minorities who are the lawless. But more and more one sees people retreating in fear. In the end, people will hope that they can live in communities that have no crime and if they have to be gated and isolated with armed guards at the entrance that that will be. That's the Jamaican way, for sure. Or, some will hope that class and wealth may prove to be the barrier that keeps 'them' away, until 'they' decide that they will strike when they please or wait for times and places where wealth and class do not matter.

But we know of people who live good lives, with richness or without, who respect others and try to guide their own actions and those of their children in directions far from crime. But their efforts do not make others, who are driven by or to crime, to convert. Those who wish to be good cannot get past the barriers of those who wish to be evil. We cannot ship them away. We cannot pen them up away from the rest of us. Every criminal is known and has a protector. Like any social secret the criminal persists because of the facilitators. So, our challenge should be to deal with the facilitators. Each one reach one?

What A Wonder Is Christmas

Anniversaries have a wonderful charm for most children. Because of their youthfulness, the passage of a year holds so much for them and the markers of a year that matter are festivals. Of course, birthdays are usually the most important, but for Christian children the next is usually Christmas. I hope that I wont offend my non-Christian friends by my not referring to whatever holidays they celebrate towards the end of a calendar year. I was brought up with the sparkle in the eyes of children at the prospect of Santa Claus arriving on the night of Christmas Eve, with his sleigh laden and his reindeer panting with excitement as they rushed around to every house to drop off the gifts before morning.


Growing up in the Caribbean, we never bothered with the contradictions of a chubby, red-faced Caucasian, heading from Greenland, over snow-covered landscapes to get to our warm lands in his heavy fur-lined coat. We did not worry about notions of Santa coming down our chimneys, even though most of us never had any idea of what was a indoor fireplace and a mantelpiece. We did not see anything amiss with images of ornament laden fir trees--we usually saw some of those even if only in a public square or a big house--but if they were in the snow near a snowman then that was part of the joyous image. Santa would descend and have his milk and cake. He would leave soot on the ground. Gifts would arrive and all the mystery was not for us to resolve. What did logic have to have with fantasy?


Of course, the point arrived when we would stop believing; for some that came abruptly when a a so-called friend broke the news that Santa was not real. Usually, it was because they had seen their father dressing up as Santa. Or they had seen their parents sneaking to put presents under a tree and then scamper back to bed. Once the spell was broken it was just a matter of could one hold on to the myth for a little longer.


Not everyone grew up with the tradition of exchanging gifts. Often, in poor countries, it was a major effort to put something special on the dining table for Christmas Day. Thankfully, the joys of home cooking did most of what was needed as the fruits that had been soaking in wine or rum all year were given the chance to bless our palettes as slices of delicious cake. Or, we would get the taste of a wonderfully baked and glazed ham. But, it could also just have been a chicken and having more than just a slice or a wing. I wont pretend to not having confused my cultures, having lived in the UK from a young age. So, things like stuffing seem to have been part of Christmas for ever. So too was a real Christmas pudding--sticky, dark and richly-filled with fruit--and mince pies dusted with icing sugar. I know that these things are part of the Caribbean Christmas as many older people produce them in quantity each year, using recipes handed down over the decades.


Then, we had the drinks. For my family, it was always sorrel and ginger, and I remember so well my mother cleaning the sorrel bush, with the twigs falling around her legs. We children never got the full flavour as our sorrel contained no alcohol, but it was still a great drink, with its redness seeming to be so much a part of Christmas. (You can imagine my heartbreak when this week the arrivals from Jamaica had their sorrel and ginger taken away by Customs officials.) Later, things like egg nog came on the scene. At some places, it was also the time for sherry.


Yet, while the excitement of presents arriving for Christmas was very real, it was for me about present that came from nowhere: they were magically summoned each year. I still find it hard to accept that you have to go to shop and buy presents. I hold onto the myth that Santa does play a part. When I watch the scurrying to buy and wrap I still wonder at what I see. I know that the notion of giving has more than one time and place so find the frenzy in December more than a little odd. It has no impulsiveness, but has a lot of compulsiveness. But, I am no longer a child so know that from my eyes I cannot really see right. I just look at my littlest child, as presents pile under the tree and she tries to guess what they are. She, at six, clearly knows that Santa only does a part of the giving. Does she prize his gifts more? Hard to say.


Now that most of the children are asleep and having that last dream before the sound of reindeer hoofs pound the roof, I hope that I can go back and imagine Christmas as a child and see its sparkle again.

Whether the sparkle is really a glorious light, or just a dull flicker, I will hope that it is bright enough to shine on the eyes of any children you see and show that they are having a wonderful Christmas time.

Wishing everyone a very merry Christmas.

'The Grinch Who Stole Christmas'--The Audience's Screams Force A Re-make

I would have thought that the Jamaican remake of 'The Grinch Who Stole Christmas' that was released on December 17 was going to be such a box office flop that the national movie making business would have had to grow a whole new set of legs. But, like with the scripts of any good film that have been badly edited, a quick look around the cutting room floor will find the scenes that should have been scrapped in place of the trash that was about to be screened. So it is with Mr. Golding's recently announced J$21 billion tax package. The people spoke loudly and angrily and suddenly Mr. Golding has seen a new light and whoosh, a bit of reconsideration and the J$21 billion is still going to be extracted from the people but in a vastly different form. The Gleaner lead article talks about 'roll back' (see Gleaner report) and the Observer notes how the poorer segments have been spared while higher income earners have to bear more of the burden (see Observer report). Like the magician with his tattered black hat, the PM has pulled out a rabbit after pulling out a goat.


The full revised measures to provide additional revenue now look like the following:

Increase of GCT rate from 16.5% to 17.5%, $3.6b
15% Ad valorem tax on petroleum, $9.4b
SCT increase on cigarettes, $1.4b
Revised 10% GCT on tourism-related services, $1.2b
GCT on residential electricity customers, $711m
Net GCT on commercial and industrial electricity customers, $742m
Net Advanced GCT Payment on imports, $2.9b
Additional Income Tax on incomes exceeding $5M and $10M ,$1.317b
Increased motor vehicle licences for top-end vehicles & additional tax on specified luxury items, $542m

TOTAL $21.812b


I will not be the first or last to ask why this revised package was necessary. If it is the better option for the country why was it not there on the table already? Getting J$21 billion out of the economy is not easy and it is not the same whatever handles are turned or arms twisted. The economic impact will be different and the macro economists at the IMF and Bank of Jamaica and Ministry of Finance and Planning Institute should tell people quickly how this will impact the economy, and how it will be different than what was proposed originally. If the revised package is not better for the country, ie is a 'get out of jail' package, which piece of flim-flamming are we to expect next to help us make sense of what is in fact nonsense? Why were the politicians prepared to put the hurt on certain sections of the population but then when there was a quick howl of anguish the hurt was spread differently? Does it suggest that the population needs to express its displeasure with economic policies as forcefully and as quickly because politicians are out of touch with the people's desires?


My admiration for politicians will not rise one iota after this escapade and no amount of head in handery will make me any more sympathetic as they get themselves out of the pickle jar into which they and the country had been plunged. While I wish them and the rest of Jamaica a merry Christmas, it's hard to see that they will be bright.

Bridging The Crediblity Gap

If a government says it has no problem but constantly acts as if it has a certain problem, then what is the problem? The problem is that it is hard to believe what it and its Ministers are saying. In politics, truth is a commodity, using any of its definition. But it is also a scarce commodity, whose value has risen enormously because of its too frequent absence or dilution.

I have listened to and read comments from the government in Barbados in recent months and wondered whether it is just me--I am admittedly a cynic--or if there really is a gap between my ears. I hear that the government says that it has no cash flow problem--hard to believe when the budget deficit is supposed to be widening, but cash could still be flowing in. Then I read that payments from the Inland Revenue were delayed and there was some problem in mobilising resources--albeit with some fuzzy logic (see Advocate December 3 report).

I've followed the debate about the country's credit ratings, knowing that one of the factors that impinge on that is whether stated policy actions are consistent with actual decisions and if expected outcomes are matched by reality.

I read this weekend of the claims by contractor Al Barrack that the government (not necessarily this administration) in the form of the National Housing Corporation, owed him around B$60 million: a court ordered he be paid B$34 million and with interest accrued this is now supposedly B$62 million. The PM was quick to acknowledge the money was due and that some money had been paid.

Of itself, the story is poignant--with tales of Mr. Barrack borrowing other people's life savings and risking his own life saving. But it highlights many weaknesses in a society that is supposed to be law abiding and rules driven--views that I have said often do not fit the national reality. It also betrays a certain dismissiveness by public officials--whom some have called 'wealth destroyers'. Someone in government must believe that owing a business some $60 million will not ruin the business or the person. Or, if they suspect that ruination may happen, that this will be for the national good and/or can be dismissed without much popular comment: the loss of the business and the possible fall of associated businesses and jobs with it is more likely when economic conditions are weak. Or they hope that the payee will just forget about the debt or die and his heirs also forget about it. Or some other nonsensical wishes.

There is a ton of writing available about public policy making and credibility of institutions. Some of it is highly readable but much of it is blindingly obvious. What has always intrigued me is how a government sees itself when it or one of its agents is being 'economical with the truth'. For those not familiar with the phrase or its more modern rendition in the mid-1980s, we are talking about lying, but for some lies are on a spectrum. As sources indicate, the phrase was first recorded from the 18th century, but rarely used. It was brought into the contemporary language by the UK Cabinet Secretary, Sir Robert Armstrong, who used the phrase during the Australian 'Spycatcher' trial in 1986. I remember it vividly, working for a government agency as I was and dealing with another set of economic untruths in the form of the Mexican debt crisis. The exchange went as follows:

Lawyer: What is the difference between a misleading impression and a lie?
Armstrong: A lie is a straight untruth.
Lawyer: What is a misleading impression - a sort of bent untruth?
Armstrong: As one person said, it is perhaps being "economical with the truth".

The 'one person' was Edmund Burke, who wrote in 1796: "Falsehood and delusion are allowed in no case whatsoever: But, as in the exercise of all the virtues, there is an economy of truth."

Governments and politicians love to give misleading impressions and some love to lie. Parliamentary proceedings should help us get to the truth, but I am not holding my breath for that to happen. Courts often help us get to the bottom of things, but as we know too well, courts may stipulate but individuals may not dispose and there seem to be all gums when it comes to getting financial redress from court orders.

Mr. Barrack's case is particularly bad, originating as it did in 2002, and involving government as the payer. But there are several other cases where courts have adjudicated and yet payments have not been made. That to me is truly contempt of court.

But, my concerns roll to the economics. When the PM/Finance Minister reminds people that Barbados has never not repaid its debts should that be taken as 'and always will'? If borrowing abroad will be avoided in preference for borrowing from domestic sources, I would always shiver because not repaying international loans has a very different taint than not paying domestic ones.

When, in late November, the PM said there was “no cash flow problem” I was not convinced and it made no sense given that economic conditions were turning out to be worse than expected. When he explained why the Inland Revenue Department (IRD) was not paying refunds my head spun. He said: “What may happen is that spending priorities may often change in times of economic difficulty, so that departments may find that the bulk of their resources may have to go towards the payment of wages and salaries and can’t be used for other programmes because departments are watching their pennies until the end of the financial year.” Why does rearrangement of the IRD's spending priorities affect the issuance of tax refunds? Don't tell people that return of their overpaid taxes are being delayed to pay the over-taxers their wages! I'm still not clear on what the PM was really saying, and may never be.

But I am clear that being economical with the truth does not change realities. Fool me once, shame on you; fool me twice, shame on me

Jamaica's Economic Plight: A Classic Bugger's Muddle

Jamaica's political leaders are looking down the barrel of a gun; or staring into an abyss; or stuck between a rock and hard place. Any of the analogies that suggest that they are on a hiding to nothing. Once again, solutions are being sought to the country's seemingly intractable economic problems.

The current government announced a package of tax measures on December 17 that were aimed at bringing in J$21 billion, after they take effect from January 1, openly stating that this was required to support the programme being negotiated with the IMF (see Government Information Service report). But by yesterday (December 20), PM Bruce Golding had been assailed by a barrage of criticisms and was on the verge of relenting: "I have heard the cry and the appeal of the Jamaican people...It is my intention to re-examine the existing composition of the tax package in order to determine if there are suitable alternatives." One wonders why this reconsideration is going to happen after the package was announced. Surely, only a corpse would think that the population would welcome this package and coming as it did a week before Christmas, only a stone-heart would not see that this would pierce most people like a dagger 1000 times. You do not need to be 'at the grass roots' to understand what will make people dispirited.

It's hard to be sympathetic to the politicians, who have singularly and variously presided over decades of misdirected efforts, and waste of borrowed money, that have left a country weighed down by a debt burden which everyone knows is unsustainable. Why should their cravenness get any reward? A country led by politicians who have presided over the sport of public corruption and party cronyism; where the police force has been venal for too long and too blatantly; which has a political class that has shown barely any inability to protect large swathes of its population from murdering individuals. This is not the kind of political leadership to get any support for a swingeing tax package at year end. It really does not matter what stripe the party has.

How can a nation be asked to make huge tax payments in the midst of an economic downturn that has already pushed the country further down? How can the tax burden be seen as anything but unfair when it seems to skip over those who make enormous gains from financial dealings or who are making huge profits from other activities? Where will struggling wage and salary earners get money to pay higher taxes?

The proposed protests by the opposition are nothing of a surprise, and thanks to the government for handing them that cudgel (see Gleaner). In the adversarial arena of Jamaican politics no one should start crying that this reaction was forthcoming. The country, in a crisis for decades, has never had a bipartisan approach to solving its problems so why expect it to surface now?

While the tax revenue may be needed to get support from the IMF and other international agencies, its bite needs to be one that shows that the fiscal 'effort' is going to be shared. That seems self-evidently not the case now. When you get protests from politicians, entrepreneurs, workers and others, then you need to sit up. There are easy target that were not eyed such as those who have gained from dealing in government debt. The tax base widening should not have been a plan for the future but undertaken now. By not doing that the smell of favouritism is too strong.

I would not wish the handling of Jamaica's economy on my worst enemy. But, I would also not expect a solution to come when no real stomach has been shown at the highest level for dealing with the core of the fiscal problems. Most of the economic problems facing Jamaica have their real sources right there in the Yard and 'laughing' and acting as if they could be solved by other people or in any way other than by cutting waste, using borrowed funds properly, and getting people to pay their taxes when due and fully was living in a fool's paradise. But starting to tackle the problems has to begin right, and that is not yet the case.

I Big Up Me Friend, Avi

Prospect magazine, which has a reputation as the most intelligent current affairs and cultural debate magazine in Britain, has produced a 'brains trust list' of those who have contibuted best to the "public conversation" during these turbulent times? Prospect names the top 25 brains of the financial crisis (see http://www.prospectmagazine.co.uk/2009/12/public-intellectuals-and-the-financial-crisis/). So, in the same week when Time Magazine named Ben Bernanke "person of the year", it's interesting to see who else in the financial field has been given a big personality. For Prospect, their winner is Simon Johnson, Professor at MIT, Peterson Institute fellow and former IMF chief economist, whom they deem 'a worthy winner'. Below is their discussion of their choices and the list. But, notable names are close to the top, including my friend and neighbour--Barbados is small--Avinash Persaud, who gets the silver medal. Well done, Avi!
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The financial crisis has destroyed both wealth and received wisdom. The idea that prices are always right and markets self-correct is fatally challenged. Even Alan Greenspan admits that the “whole intellectual edifice” of the efficient market hypothesis collapsed in the summer of 2008. The financial establishment is in a state of deep confusion. As the FT’s Gillian Tett put it in September’s Prospect: it is like “a priest who has lost faith in the Bible, but still has to go to church.” But this is not a bad thing, for it has opened up new ways of thinking about markets, institutions and the all-important cause of financial reform.

Unfamiliar voices have come to prominence, aided by a new wave of financial bloggers eager to push fresh ideas. But who has made the most impact? Prospect assembled a panel of experts to draw up a list of leading “public intellectuals” of the financial crisis in 2009 and then decide on the most important. Our criteria were simple. Anyone who had made an impact on policy with their ideas, or who had changed the “public conversation” was a candidate.

The panel sifted hundreds of names, with an unavoidable bias towards Britain and the US, but felt the most important contributions had been in financial reform—those trying to work out what to do next. The crisis has laid a staggering financial burden on the world, with some $14 trillion propping up US and EU banks. We cannot afford another one. Moreover, we urgently need a new regulatory philosophy. Are liquid markets always good? Is complexity in financial services harmful? Can finance firms stop “herding,” creating wild booms and busts?

The role of the banks themselves is also being rethought. They have mushroomed in size without doing a better job—Royal Bank of Scotland’s balance sheet grew 20-fold in the decade from 1998. Some banks have become too big to fail and hence dangerous. Should we return to the strict division between commercial and investment banking, as proposed by Paul Volcker and Mervyn King? And how can we now rein in this super-sized financial system with its powerful lobby? Many of the surviving megabanks have pressured governments for a return to the status quo ante. They want their old economy back, with the implicit warning that if they don’t get it there will be no recovery—and politicians will be blamed.

We considered all of this, and gradually whittled the names down to a shortlist of just 25 (see facing page), and then a top three. In reverse order, the bronze medal went to Adair Turner, chairman of Britain’s Financial Services Authority, who bravely questioned the social usefulness of some financial activity, and called for regulators to force banks to hold more capital against risky trades, cutting their profitability. Next, silver went to Avinash Persaud, a respected analyst who spotted nine years ago the dangerous interaction between firms “herding” and new risk management techniques. During 2009 he has been arguing for new “macro-prudential” regulation to stop what he discovered a decade ago.

But there was a clear winner. He is Simon Johnson, an economist at the prestigious Peterson Institute in Washington, DC, who has been leading the argument against overmighty banking. His ideas are well grounded in theory, but he has also done more than any academic to popularise his case: writing articles, a must-read blog, and appearing tirelessly on television. As the FT’s Martin Wolf told Prospect: “Johnson’s significance is that he is a member of the establishment—a former IMF chief economist, no less—who has emphasised the capture of the state by big finance, for the latter’s own ends. An expert on crises in emerging countries and in transition from communism, he has called what he has seen: crony capitalism at the heart of the financial system.” In particular Johnson’s essay “The Quiet Coup,” in the Atlantic of May 2009, is one of the great polemical essays of the crisis. Far from skulking in an ivory tower, he has urged citizens to the streets.

We need an informed debate about making finance safer. Johnson, Persaud and Turner led that debate in 2009.

PROSPECT’S TOP 25 BRAINS OF THE CRISIS

1. Simon Johnson Professor at MIT, Peterson Institute fellow, former IMF chief economist, blogger, troublemaker and scourge of once-mighty banks—a worthy winner in 2009.

2. Avinash Persaud Financial liquidity analyst, adviser to governments around the world, the man who has studied “herd” behaviour in finance, and now the man trying to stop it.

3. Adair turnerAn unusually bold regulator, Turner made headlines worldwide slamming “socially useless” finance (in Prospect) and suggesting a Tobin tax to put sand in the wheels of global finance.

Ben Bernanke Cerebral Federal Reserve chairman, seen by many as saviour of the US economy while congress dithered.

Andrew Haldane Bank of England director who warned of a “doom loop” of perpetual banking bailouts.

Philip Hildebrand Swiss banker who boldly pushed cutting his country’s banks to size.

John Kay Well-regarded British economist who wants a return to simple banking.

Mervyn King Bank of England boss, initially wrong-footed by the crisis, but had a better, more aggressive 2009.

Richard Koo Insider adviser to politicians and banks, an expert on the lessons from Japan, and deficit dove-in-chief.

Paul Krugman Celebrated economist and author of a must-read New York Times essay on the failures of economics.

Christine Lagarde French minister of economic affairs who got just the right mix of stick and carrot for French banks.
donald mackenzie Edinburgh professor, author of many sharp LRB essays unpicking the anthropology of finance.

Lucy Prebble 28-year-old British author of Enron, the best play yet on irrational exuberance.

Nouriel Roubini Legendarily gloomy, normally correct finance analyst whose blogs alone can move markets.

Brad Setser Young policy wonk, co-blogger with Simon Johnson and author of Bailouts or Bail-ins? with Roubini.

Robert Shiller Credit-crunch US sage and behavioural economics pioneer.

Jon Stewart Brainy American satirist whose Daily Show has made finance a laughing stock.

Joseph Stiglitz Nobel laureate, chair of UN commission on financial reform and harsh critic of finance-as-usual.

Matt Taibbi US journalist, wrote a celebrated scathing attack on Goldman Sachs.

Paul Volcker Ex-Fed chair, pushing for splitting up investment and savings banks.

Elizabeth Warren Harvard professor, consumer rights watchdog, leads the panel watching over Obama’s bailout money.

Martin Wolf FT writer and the Anglosphere’s most influential finance journalist.

Paul Woolley Innovative LSE thinker on “capital market dysfunctionality.”

Yu Yongding Influential economist at the Chinese Academy of Social Sciences.

Zhou Xiaochuan Bank of China head, architect of China’s response to the crisis.

Thanks to those who helped us pick a list or select winners, including: Rudi Bogni, Diane Coyle, Will Davies, Meghnad Desai, John Eatwell, Christopher Hird, Will Hutton, Faisal Islam, Stephanie Flanders, George Magnus, Jasper McMahon, Felix Salmon, Richard Sennett, Rohan Silva, Laura Tyson, Isabel Hilton and Graham Turner

The Joy Of Christmas

This time of year holds so much fun in store. Children draw it out best of all as they fill themselves with excitement at every chance that a present will appear. Adults are a mixed bag. I asked a woman shop attendant last week if she was looking forward to Christmas and she said "No," without hesitation. I asked her if she was a Christian, and she retorted "Who, me?" I did not go any further. For many adults, Christmas is hard work to satisfy self, family, children and others, and work seems to increase rather than lessen. Christmas can be the season of more, more more. But, I try to take Christmas as a season during which I lighten my load. It can be a well-imposed break: I explained to some friends that as with Easter, Christmas week and longer would find me nowhere near my office, when I worked in one. I like the Caribbean way of celebrating the season: passing by friends and relatives and eating cake; drinking sorrel and ginger, and egg nog, and ponche de creme; singing carols; having a houseful of people ready to out up with discomfort for the coziness of friendship.

But, the season is a good one for levity. Some of it is purely accidental. I got back to my house and took a call from the US from someone wanting to talk to my wife. I told them brusquely that she was not available. "When will she be back?" the over-friendly operative asked. "Next year," I said, without hesitation. The pause was long. "Oh yeah...in a few days. Gotcha. Good one." He laughed. So, even before old Saint Nick comes down the chimney chiming "Ho, ho, ho!" we can have a good chuckle.

Many friends on the east coast of the US are chuckling today because nature chucked down a good foot of snow over the past 12 hours and many of them are forced to stay home and 'chill'. Those who were due to travel are hopeful for a break so that they can go; that includes my daughter who should be headed from Virginia to The Bahamas, but judging by the picture of her garden, chances look slim. Ironically, I just headed back from there yesterday and had the bad weather trailing behind. If you love skiing and sledding then out you go and hope not to crack a rib or two. My littlest one loves cold weather and falling on her tush while ice skating during the week was one of her high spots: not every one thinks that constant warmth and sunshine every day is paradise.

We often get 'stir crazy' after a few days cooped up in the house, so we will see how the fun lasts for those stuck in the snow. No one will mind a few days extra off from work, and chestnuts roasting by the open fire is a lovely thought. I would send a few bottles of rum to help along the proceedings, and ensure a pleasant if not silent night.

But Christmas is really about giving, though children often see only the getting side of that. Friends fall over themselves to give to children. Godparents of my daughter gave her a few boxes to jam into her suitcase as we departed from DC yesterday, and then also produced a little horse head on a stick. It happened to be just too long for any suitcase, so we had to carry it by hand. When you press the ear of the horse it neighs, so we were happy to not have that droning up from the hold. But as we checked in the airlines had to deal with finding seats for two people and a horse. Amongst the constant panic of terrorism, it was interesting that the horse head stick raised not an eyebrow: presumably all the scanners found it stuffed with nothing but stuffing.

But giving is good and already with no sight of Santa we are getting gifts, including a nice surprise during our breakfast at Brighton's Farmer's Market this morning. But as always we have to spare more than a few thoughts for those who will have nothing to give and nothing to get. It should never be that way but it is. So, while those of us who can love each other and hand over what we wish, stretch out our hands, our fingers should take the gifts with a little reluctance, knowing that we probably have all we need and could wish for already. That makes the joy of Christmas a little bitter-sweet

You Really Going To Crush My Corns?

What is the worst news that a Caribbean island can get? It may be warnings of an impending hurricane: the season is long and many such alarms come and go without any damage and complacency sets in. It could be the rumblings of a volcano, signalling that one of the active, though dormant caps may blow. We have seen their devastation often enough on those tiny isles, such as Montserrat: the British arrive and offer to take people away from danger in boats, and many refuse. It could be a plague of African snails, munching on our crops and devastating what harvests were due. But if we are offered a bounty to capture these beasts the money goes unused and if we are told we can cook and eat them, people are more ready to say "Who me?" than swallow their pride and prejudice and chew on the grubs.

But worse is the news that British Airways unions are threatening a strike to happen over the Christmas period. We read that "The 12-day walkout could cost loss-making BA £30million a day and ruin the airline." But the strike could cost many islands their tourist revenues for the season. The UK news lines are reporting the frantic action being taken by airline and potential passengers (see Mirror report): court cases, re-booking like crazy.

I spoke to some academics and practitioners in the tourism sector recently about the fact that I dislike tourism for many reasons. One is that the industry is hard to control from the suppliers side: you cannot make more sun, sea or sand that easily, or make them better; you can make rooms fancier and offer more discounts, but they eat away your earnings. I also do not like it as a pillar for development, because it sucks up so many national resources that cannot then be diverted elsewhere if needed. Unused hotel rooms/nights are a 'perishable' good a well known US hotelier said recently: once past their 'sell by' date they are useless.

So what will countries like Barbados do if the Brits cannot come in a few days time? Not much Christmas cake can be made and eaten if those airlifts do not arrive? The hardy will try to get here by hook or by crook and by any airline routing they can--they have money to preserve too. Maybe it needs a Churchillian effort to 'evacuate' Blighty and deposit ship loads of Brits on the beaches--like 'Operation Dynamo' from Dunkirk in reverse. Makes you feel miserable?

Here's to a merry Christmas.

A Tiger Caught By The Tale

I may be the only person writing these past two weeks who has not been like Tiger Woods and bowed to a simple temptation, in this case to write about the fall from grace of the golfing phenom. Truth is that TW, or Tiger, has become the butt of jokes so fast that I had to step back and wonder if the readiness to pull down the great is so strong that as soon as we get a handle on a rope that will tug such people to the ground that we all pull on so hard. We are mostly all quite normal, so the super normal is hard to understand and when it or they show that they are superbly normal and horribly flawed in go the fangs on we love to watch the blood spurt. So, with Tiger. Now, for my piece of the flesh.

Caribbean people often laugh that the seeming prudeness of societies such as America's, which flaunt wild and loose lifestyles, then seem shocked when everyone appears to live by loose and wild lifestyles. In this region, we are far from perfect but in some aspects we have reached a very sensible position, and the area of sexual promiscuity and infidelity is one such area. We joke about: 'how many outside women one man has' (aka sweethearting); 'how many outside children' a man or woman may have ('giving bun', in Jamaican parlance); how a man may be fooled into thinking that the children his wife or woman bears are his ('jacket'). It would be a matter of pride and stature that a man was found to have had as many as 11 affairs during the period of a 4 year marriage, let alone being a near unbeatable golf champion at the same time. That is what we call highly energetic. We have many famous songs about the process of being caught and denying it. One of the all time classics is Pluto Shverington's 'Your Honour':



For those who are challenged by Jamaican patois, here are some of the lyrics:

Oh lord, anybody see my trial grieves for I
Why lord I was badly beaten, found by loved ones
Battered by an irate husband
Searching for a man that wasn't I.
When we reached the court we garn inside,
the hand of justice shall preside
over this case the trial shall begin.

Your Honour I was inside de closet
minding I and I own business.
Your Honour it was a complete stranger
causing these disturbances.
Him claims of me touching him wife
which is a wicked and awful lie
Me two hands 'em was occupied
me shirt's in me left
and me pants in me right
me hand 'em was occupied
me shirt's in me left
and me pants in me right

Dear Judge, can this court accept my story from me heart?
Why Judge,if by chance you don't believe this tale
ask him why she will not fail to agree I was a better man than he.
Just in case she refuse to answer, ask de maid
downstairs, Agatta
she gonna be glad to testify for me.

Not the alibi! My hands were occupied...Bottom line is that Tiger could swan around the Caribbean without all the hair shirt stuff and maybe less than sincere promises to turn over a new leaf.

But, as the comedic tendencies have show, Tiger was tailor made for ribadly. He has many things going against him, not least his name. 'Tiger': now a mere pussy cat rather than a fearsome, growling, stalking, attacker; we have him by the tail and want to hear his tale; can he change his stripes? (or spots, as one writer asked). 'Woods': he would, of course; we want to know about his wood; tell us about the stick.

His sport is all too easy to parody. 'He got his balls too close to too many holes', is one great line I have read. He wanted to have a hole in one but could not be satisfied with one hole, or really wanted to have one in a hole. Now, his wife has given him a hole in his head and he may soon have a hole in his pocket. He should have had no trouble getting out of the brush. Did he use his iron or his wood, and what did he do with his wedge? He was using his putter to do too much puttering, and if he had just kept it to a few pots in the garden shed then he would have less dirt on his hands now.

But, TW has shown me many simple truths. I shared with some friends yesterday my view as an economist:

"Everything has a price, and supply and demand do work. Tiger found out that truth is a currency. Had he not lied what would have been the 'value' of exposing him? Very little. Having lied (making truth more scarce), he bid up the price of truth. Econ 101."

Not everyone may see it this way, but interestingly, John Daly, a fellow golfing professional, was reported as saying, "I feel like if there's anybody in this world - after what I've gone through, the ups and downs - I might give him some advice. They always say there is nobody bigger than the game of golf, but right now in these times there is, and it's him," he added. He said Woods should have come out publicly when news of his affairs first broke and told the truth.

Some women friends of mine have been mercilessly roasting les boules du tigre all week, and as most of these ladies are black, they have lammed him for his choice of colour. I actually think that this is not as much of an issue as the ladies would like, because they come to it through their racial definitions, and clearly TW did not share them. Why? Is it a major problem? Hard to say. In the same way that POTUS does not share the racial definitions and categorization of so-called African Americans. But that will be a discussion for the ages.

I am wondering about all the funky financial deals TW seemed ready to put up to keep his pecker pecking. I am also intrigued by all the 'victims', who are actually more like carrion, ready to feed on the boy. I am absolutely sure that not one of Tiger's 'conquests' thought that she was 'the one'. I am even more convinced that for them, Tiger, was not 'the one'. The player was being played as hard as he was playing. It was hard on him that he could not see that. Hard on him, indeed.

Now, he has decided to step away from what he should have focused on, his golf, to try to repair his family relationship. Is he sincere? When you are the product of image managers--remember that Tiger's playing wardrobe is meticulously choreographed by Nike and others--it is hard to believe that such actions are 'all natural'. I wondered how he had to time for all the double and triple and quadruple dipping. All those golfers I know have no relationships because they seem to spend all their time golfing and hitting their balls. No time for clubbing as they are too busy with their clubs.

His sponsors are taking different steps but broadly putting (with put, not putt-ing) distance between Tiger and their products--Gillette, Accenture...not heard from Buick (who must have been miffed and pleased that he mashed up a Cadillac). My wife has put out the warning that after Henry and his hand on the ball, have Tiger with his balls in his hands, so what of Federer? Will we soon hear that Roger was doing his thing to get felt up--other than just brushing balls with his forehand strokes. In fact, Roger's stroking of balls and his fore(hand) play should make his a very worrying story.

None of our interest is inappropriate: we made him with our adulation so we can demolish him with our disapproval. These people are thrust on us and we lap them up. Now, we are ready to spit them out. Personally, I want to remain obscure, if fame has this kind of price. So when people start to call me a celebrity because I blather on the radio and have a blog, I duck my head and say "No way, brother."

So, I am off to brush my balls and get felt up good and proper with a man, to boot. I will be courting him hard and if he wants to know what is my racket, I will tell him honestly...it's a Wilson. He may want to give me his Head to play with, but I'm no fool and will decline, graciously.

Blessings.

Barbados And OECS Corporate Performance And Outlook Report

Dr Justin Robinson, Head of the Department of Management Studies at the University of the West Indies, Cave Hill, shared with me a new report on sub regional corporate performance. Data were collected in September. The report will be published on a quarterly basis, data will next be collected in January of 2010 and a report published in February 2010.

The survey indicates that financial performance of the majority of companies has worsened over the last six months, with “the majority of companies in St. Lucia, Antigua, St. Vincent and Barbados report a worsening of financial performance”, surprisingly “public utilities sector should report the most significant decline in financial performance”.

The majority of companies in St. Kitts, St. Lucia, Dominica and St. Vincent “expect the decline in financial performance to continue for another six months, while a majority in Grenada, Barbados and Antigua expect financial performance to improve over the next six months”. But, the “majority of companies in all countries expect financial performance to improve within a year”. All industries, except for public utilities, “expect financial performance
to improve within a year, but the slump is expected to continue for another six months in the crucial construction, and tourism sectors”. This suggests that these economies have some serious economic contraction ahead in 2010.

The “investment outlook for the corporate sector in Barbados and the OECS is bleak over the next six to twelve months”. The survey results indicate that “the majority of companies have no capital investments of any form planned over the next six or twelve months”, and this is in all sectors with the exception of companies operating within the community/social/personal services. This implies that the “majority of companies in Barbados and the OECS expect the level of employment in the corporate sector to remain unchanged or increase slightly over the next six months”. Companies suggest that they “do not plan major layoffs”, despite the fact that they have experienced worsening financial performance over the last six months, and expect financial performance to continue to worsen over the next six months, and “expect employment to increase over the next twelve months”, and they are more optimistic about employment prospects over a twelve month time horizon as compared to a six month horizon.

Companies “expect the local economy to remain largely unchanged for the next six months, while they have a positive outlook for the global economy”.

Why these local conditions prevail is not a part of the survey, but it would be useful in future studies to try to get behind the thinking of local firms, in particular regarding their attitudes and apparent reluctance to lay off workers in hard times.

*********************

Barbados and OECS

Corporate Performance and Outlook Report

Introduction and Background

We are pleased to introduce the “Barbados and OECS Corporate Performance and Outlook Report” published by the Department of Management Studies at UWI, Cave Hill. The survey aims to provide policymakers and the public in general, with timely and readily accessible information on the, Financial Performance, Financial Outlook, Investment Outlook, Employment Outlook, Local Economic Outlook and Global Economic Outlook, as it relates to companies in Barbados and the OECS. The aim is to provide more of a ground level perspective on financial and economic matters as compared to the more macro-economic type data that is typically available.

The results of this edition of the survey are based on responses from 758 companies in Barbados, Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Lucia and St. Vincent and the Grenadines (Table 1 provides a breakdown of the responses by country). The data was collected in September, 2009, thus companies would be reflecting on their performance from March to August of 2009, and their six month outlook would be from September to February 2010, while the twelve month outlook be from September 2009 to August 2010. The report will be published on a quarterly basis, data will next be collected in January of 2010 and a report published in February 2010. The report is funded by the Department of Management Studies at UWI Cave Hill and we encourage a broad cross section of organizations to participate in our survey as we seek to provide this public service.

Table 1: Respondents’ Profile

Country	Frequency	Percent
Antigua and Barbuda	172	22.7
Barbados	80	10.6
Dominica	77	10.2
Grenada	151	19.9
St Kitts	51	6.7
St. Lucia	140	18.5
St. Vincent	87	11.5
Total	758	100.0

Section 1: Financial Performance and Outlook

Financial Performance

As a measure of financial performance, companies are asked to indicate whether their financial performance compared to six months ago was, much worse, worse, unchanged, better or much better. Based on their responses, a “Financial Performance Index (FPI)” score is then computed. FPI scores above 100, indicate improved levels of financial performance, whereas scores below 100 indicate worse financial performance compared to six months ago.

The FPI score for companies in Barbados and the OECS is 85, indicating that the financial performance of the majority of companies has worsened over the last six months. Despite the much publicized economic slowdown of the last year, the majority of companies in Grenada, Dominica and St. Kitts, report unchanged or improved financial performance over the last six months. However, the majority of companies in St. Lucia, Antigua, St. Vincent and Barbados report a worsening of financial performance. Companies in St. Lucia and Antigua report the most significant declines in financial performance, with nearly two-thirds of companies reporting a worsening of financial performance. See table 2 and figure 1 for a summary of these results.

Table 2: Financial Performance Compared to Six Months Ago

Country	Much Better / Better	No Change	Much Worse/Worse
Antigua and Barbuda	13%	24%	63%
Barbados	18%	26%	55%
Dominica	31%	36%	33%
Grenada	35%	46%	19%
St. Kitts	37%	20%	43%
St. Lucia	6&	30%	64%
St. Vincent and the Grenadines	18%	26$	56%

Figure 1








The decline in financial performance is evident across a broad variety of industries. The entertainment and education and cultural services industries have managed to weather the storm so far and report improved financial performance, whilst all other industries report a worsening of financial performance over the last six months. While the declines in construction, retail, wholesale and tourism related industries are to be expected, it is somewhat surprisingly that the public utilities sector should report the most significant decline in financial performance. See figure 2 for a summary of the results by industry.

Figure 2











Financial Outlook:

The companies surveyed were then asked to indicate whether they expect their financial performance in the next six/twelve months to be, much worse, worse, unchanged, better or much better than current financial performance. Based on their responses, a “Financial Performance Outlook Index (FPOI)” score is computed. FPOI scores above 100 indicate an expectation of improved levels of financial performance, whereas scores below 100 indicate an expectation of worse financial performance.

The majority of companies in St. Kitts, St. Lucia, Dominica and St. Vincent expect the decline in financial performance to continue for another six months, while a majority in Grenada, Barbados and Antigua expect financial performance to improve over the next six months. However, the majority of companies in all countries expect financial performance to improve within a year. All industries, except for public utilities, expect financial performance to improve within a year, but the slump is expected to continue for another six months in the crucial construction, and tourism sectors. These results are summarized in Table 3.

Section 2: Investment and Employment Outlook

Investment Outlook:

In order to evaluate the investment outlook for Barbados and the OECS, companies are asked to indicate whether or not they have any major capital investments planned over the next six/twelve months. An “Investment Outlook Index”, is created based on their responses. An index value greater than 100 indicates that the majority of companies have major capital investments planned over the next six/twelve months, while an index value less than 100 indicates that the majority of companies have no capital investments of any form planned for the next six/twelve months.

The investment outlook for the corporate sector in Barbados and the OECS is bleak over the next six to twelve months. The survey results indicate that the majority of companies have no capital investments of any form planned over the next six or twelve months. These results translate to a six month Investment Outlook Index (IOI) score of 72 and a twelve month IOI score of 52. Companies in St. Kitts have the most optimistic investment outlook over the next six and twelve months with IOIs of 104 and 96 respectively, while companies in Grenada have the most pessimistic six month outlook with an IOI of 52, and St. Lucian companies the most pessimistic twelve month outlook with an IOI of 32. The bleak investment outlook affects all sectors with the exception of companies operating within the community/social/personal services, where a majority of companies have major capital investments planned for the next six months. These results are summarized in Figure 3 and Table 4.

Country	Financial Outlook Index Scores (for the next 6 months)	Financial Outlook Index Scores (for the next 12 months)
Antigua and Barbuda	101	121
Barbados	113	129
Dominica	95	122
Grenada	115	117
St Kitts	92	118
St. Lucia	93	119
St. Vincent	96	120
Industry	Financial Outlook Index Scores (for the next 6 months)	Financial Outlook Index Scores (for the next 12 months)
Agriculture, fisheries, and mining	107	124
Educational and cultural services	107	118
Government services	93	107
Manufacturing	112	133
Financial/banking/insurance services	112	125
Public utilities	86	90
Retail/wholesale	98	120
Entertainment	106	123
Business/professional/real estate services	99	120
Construction	95	109
Transport, communication and storage services	95	117
Community, social, personal services	97	118
Tourism/restaurant/hotels	98	113
Other	113	137

Table 3

Financial Performance Outlook Index by Country and Industry

Note. Index scores above 100 reflect optimism, whereas index scores below 100 reflect pessimism.

Figure 3

Industry	Investment Outlook Index Scores (for the next 6 months)	Investment Outlook Index Scores (for the next 12 months)
Agriculture, fisheries, and mining	57	35
Educational and cultural services	64	44
Government services	30	21
Manufacturing	91	56
Financial/banking/insurance services	46	45
Public utilities	22	22
Retail/wholesale	80	53
Entertainment	52	28
Business/professional/real estate services	68	43
Construction	90	65
Transport, communication and storage services	100	74
Community, social, personal services	169	59
Tourism/restaurant/hotels	70	64
Other	57	45

Table 4: Investment Outlook By Industry

Note. Index scores above 100 reflect optimism, whereas index scores below 100 reflect pessimism.

Employment Outlook:

To evaluate the employment outlook for Barbados and The OECS, respondents are asked to indicate whether they expect employment at their company to increase, decrease or remain unchanged over the next six months. Based on their responses, an “Employment Outlook Index (EOI”) is computed. An EOI above 100 indicates an expected increase in employment, whereas an EOI below 100 indicates an expected decline in employment.

The six month EOI for Barbados and the OECS is 108. This suggests that the majority of companies in Barbados and the OECS expect the level of employment in the corporate sector to remain unchanged or increase slightly over the next six months. This suggests that companies do not plan major layoffs, despite the fact that they have experienced worsening financial performance over the last six months, and expect financial performance to continue to worsen over the next six months. Companies in St. Kitts and Barbados are the most optimistic about employment prospects over the next six months, while companies in St. Lucia and Grenada are the most pessimistic. Across industries, companies in the financial and government services industries are the most optimistic about employment prospects over the next six months, while companies in the community /social/personal/services and, transportation/communication/storage are the most pessimistic.

The twelve month EOI for Barbados and the OECS is 115. This suggests that the majority of companies in Barbados and the OECS expect employment to increase over the next twelve months, and they are more optimistic about employment prospects over a twelve month time horizon as compared to a six month horizon. Companies in Barbados and St. Vincent are the most optimistic about employment prospects over the next twelve months, while companies in Grenada and St. Lucia are the most pessimistic. Across industries, companies in the financial / banking /insurance services and government services are the most optimistic about employment prospects over the next twelve months. See figure 4 and table 5 for a summary of these results.

Figure 4

Industry	Employment Outlook Index Scores for the next 6 months)	Employment Outlook Index Scores (for the next 12 months)
Agriculture, fisheries, and mining	114	120
Educational and cultural services	104	117
Government services	126	126
Manufacturing	117	117
Financial/banking/insurance services	126	129
Public utilities	118	118
Retail/wholesale	104	112
Entertainment	119	116
Business/professional/real estate services	99	111
Construction	111	122
Transport, communication and storage services	98	105
Community, social, personal services	95	102
Tourism/restaurant/hotels	101	104
Other	114	126

Table 5: Employment Outlook by Industry

Note. Index scores above 100 reflect optimism, whereas index scores below 100 reflect pessimism.

Section 3: Economic Outlook

Companies are asked to indicate their outlook for the local and global economy over the next six/twelve months. Based on their responses, a “Local Economic Outlook Index (LEOI)” and a “Global Economic Outlook Index (GEOI)” are calculated. An LEOI or GEOI above 100 indicates a positive outlook for the local (global) economy, whereas an LEOI or GEOI below 100 indicates a negative outlook for the local (global) economy.

For Barbados and the OECS, the six month LEOI is 103 and, the GEOI is 128. The index scores suggest that companies in Barbados and the OECS, expect the local economy to remain largely unchanged for the next six months while they have a positive outlook for the global economy. Companies in Dominica, Grenada, and St. Kitts are the most optimistic about the prospects for their local economies over the next six months, whereas those in St. Lucia and St. Vincent are the least optimistic about the prospects of their local economies over the next six months. In terms of the global economic outlook, the majority of companies in all countries expect the global economy to improve over the next six months, with companies in Barbados and St. Lucia being the most optimistic, while those in St. Vincent and Dominica the least optimistic.

For Barbados and the OECS the twelve month LEOI is 109 and the GEOI is 118. The index scores suggest that the majority of companies in Barbados and the OECS expect the local and the global economy to improve over the next twelve months. They are, however, more optimistic about the prospects for the global economy than their local economies. Companies in St. Kitts and Dominica are the most optimistic about the prospects for their local economies, while those in St. Vincent and St. Lucia are the least optimistic about the prospects for their local economies over the next twelve months. In terms of the global economic outlook, companies in Barbados, St. Kitts and Grenada are the most optimistic, while those in and St. Vincent, Dominica and Antigua are the least optimistic.

In terms of industries, manufacturing, government services and entertainment are the most positive about the prospects for the local; economy over the next six months, while business/professional/real estate services, community/social/personal services and educational and cultural services are the least positive. Over a twelve month horizon, entertainment, construction and manufacturing are the most optimistic, while public utilities, business/professional/real estate services and tourism/restaurant hotels are most pessimistic. The results are summarised in Figure 5, and Tables 6.

Conclusion

Companies in Barbados and the OECS are currently feeling the effects of the global economic slowdown. This is reflected in a worsening of financial performance over the last six months across countries and sectors. Companies in the tourism and financial services dependent economies of Antigua, St. Lucia and Barbados are among the worst hit, whilst companies in the public utilities, tourism related and the retail and wholesale sectors are among the worst affected. Companies in the entertainment industry are the least affected. Residents of Barbados and the OECS appear to be partying despite the economic slowdown.

Unlike their international counterparts, companies in Barbados and the OECS appear disinclined to lay off workers as a means of responding to worsening financial performance. However, there appears to be a hold on investment, with the majority of companies report no major investments planned for the next six/twelve months.

Companies in Barbados and the OECS appear to expect the economic slowdown to last for another six months at least, but they expected improvements in the next twelve months. The prospects for improvement appear to be driven by an expectation that the global economy will recover in the next six to twelve months.

Figure 5

Industry	Local Economic Outlook Index Scores (for the next 6 months)	Local Economic Outlook Index Scores (for the next 12 months)
Agriculture, fisheries, and mining	101	111
Educational and cultural services	93	104
Government services	109	115
Manufacturing	112	119
Financial/banking/insurance services	102	105
Public utilities	60	82
Retail/wholesale	108	108
Entertainment	109	127
Business/professional/real estate services	91	97
Construction	101	121
Transport, communication and storage services	106	108
Community, social, personal services	91	102
Tourism/restaurant/hotels	99	102
Other	117	120

Table 6

Local Economic Outlook Index by Industry

Industry	Global Economic Outlook Index Scores (for the next 6 months)	Global Economic Outlook Index Scores (for the next 12 months)
Agriculture, fisheries, and mining	124	116
Educational and cultural services	120	115
Government services	136	127
Manufacturing	139	130
Financial/banking/insurance services	136	124
Public utilities	132	127
Retail/wholesale	125	115
Entertainment	131	116
Business/professional/real estate services	131	113
Construction	122	121
Transport, communication and storage services	126	115
Community, social, personal services	132	115
Tourism/restaurant/hotels	120	114
Other	133	125

Note. Index scores above 100 reflect optimism, whereas index scores below 100 reflect pessimism.