One Jamaica

Jamaican political parties party to scandal?

2008-09-11T10:45:00.000-07:00

Anyone with basic connections knew that both parties in Jamaica, the JLP and the PNP, accepted money from Cash Plus and Olint, companies that were deemed to be unregistered financial entities flouting the law.

The Jamaica Gleaner today carries an article titled Parties should repay Cash Plus, Olint by Rev. Devon Dick and I must say that I agree with his reasoning.

It is strange that the then governing party, PNP, would accept money from Cash Plus and Olint when its own minister of finance was so strident against these two companies and there was a cease and desist order against one company. The PNP was saying one thing and doing another. The JLP would have information about these companies that ordinary Jamaicans would not have. I was made aware from September/October last year of some of the things that have since proven true. To accept donations from Cash Plus and Olint was worse than accepting money from Trafigura.

"Do as I say, not as I do" - no surprise. Few politicians ever lead by example.

If it were in the United Kingdom or the United States of America, the leaders who received the money and had knowledge of it would have resigned. In addition, the present minister of finance, when he was Opposition spokesman for finance, gave an endorsement of such enterprises in his budget speech. Some church leaders were principals and participants in foreign exchange trading clubs. A football entity headed by a former prime minister negotiated a sponsorship deal with Cash Plus and it was expected that ordinary Jamaicans should know that Cash Plus was little more than a pyramid scheme?

I highly doubt a single head will roll.

Welcome to Jamrock

Jamaic Under Spanish Rule Again?

2008-08-26T13:48:00.000-07:00

I read the Jamaica Observer editorial today and had to agree (see Globally - unsurpassed glory; Locally - same old story).

In it, the Editor says:

At any other time, it would still have been painful to read the story in our Friday edition that the St James Parish Council, in a hurriedly called meeting, approved the illegal building plan under which RIU has built three four-storey buildings as part of its Mahoe Bay Hotel near Montego Bay.

and..

Historically, no Jamaican has been able to build more than three storeys in the flight path of the Sangster Airport. They would have been summarily locked down, chased out of the country or vilified to the point of shame and degradation.

The Jamaican people must be asking who is running our country - the Spanish or the Government? Why don't we just hand over the reins of government to them? After all, the Spanish once ruled Jamaica.

While we chastise our own and usually don't support them until some foreign entity recognizes them for something, we seem prepared to let the Spanish investors walk all over us.

Disrespecting the people and the government of a country you do business in is not the right way to win friends.

I look forward to the PM making a very clear statement that we will not tolerate this kind of behaviour and no one's money is worth selling ourselves short.

We as Jamaicans must support those companies that respect us and deal with the ones who still have a colonial mindset, thinking that their money allows them to get special privileges and not follow the laws of the land.

Who Has The Worst History of Doping?

2008-08-22T12:39:00.000-07:00

It is quite interesting to see Americans accuse Usain Bolt of doping when Jamaica has no history of doping but the USA has the following:

The dawn of drug testing was the 1983 Pan Am Games in Caracas, Venezuela and when Canadian weightlifter Guy Greavette tested positive for steroids, a dozen American athletes in various events suddenly withdrew from the competition and returned to the U.S., and at least another dozen athletes from other countries also left without explanation.
Former U.S. Olympic Committee anti-doping chief, Dr. Wade Exum, wrote a 30,000+ page report in 2003 that said:

(1) 19 American medallists were allowed to compete at various Olympic Games from 1988 to 2000 despite having earlier failed drug tests

(2) More than 100 athletes from several different sports tested positive for banned substances between 1988 and 2000 but were cleared by internal appeals processes.

(3) According to Exum's evidence, Lewis was one of three eventual Olympic gold medallists who tested positive for banned stimulants in the months leading up to the 1988 Seoul Games. Lewis was awarded the gold medal in the 100-metres after Ben Johnson was disqualified for using steroids.
US athlete Jerome Young being allowed to compete – and win a gold medal – at the 2000 Sydney Olympics despite testing positive for steroids in 1999.
2003 was a big catch:
(1) U.S. sprinter Kelli White stripped of her two gold medals from the World Track & Field Championships for testing positive for Modafinil
(2) four-time U.S. 400 hurdles champ Sandra Glover
(3) 25-time U.S. middle distance national champion and two-time 1,500 meter World Champ silver medalist Regina Jacobs
(4) 2003 U.S. national shot put champion Kevin Toth
Tim Montgomery - 100m World Record revoked after he admitted accepting steroids and other performance enhancing drugs from BALCO
CJ Hunter
Marion Jones
Cyclist Floyd Landis
Justin Gatlin, the American sprinter and Olympic gold medalist, with a 100 m personal best of 9.85 seconds. He is currently serving a four year ban
Alvin Harrison, an American athlete that won a gold medal in the 4 x 400 metres relay at both the 1996 and 2000 Summer Olympics and a silver medal in the 400 metres at the 2000 Summer Olympics. Alvin Harrison did not compete in the 2004 Olympics due to circumstantial evidence of using a banned substance. In October of 2004, Harrison agreed to a four-year suspension with the U.S. Anti-Doping Agency.
Antonio Pettigrew was a 2000 Olympic gold medalist in the men's 4x400 meter relay for the United States, by his own admission while using performance-enhancing drugs between 1997 and 2001. The 2000 Sydney Olympics 4 x 400 metres relay US team was stripped of their medals after Pettigrew admitted that he had used performance-enhancing drugs
Jerome Young (born in Clarendon, Jamaica) attended high school in Hartford, Connecticut at Prince Technical, is a sprint athlete. His reputation as a sprinter has been tarnished as he was caught doping in 1999. He and his teammates were stripped of their 2000 Olympic medal in the 4x400 m relay
LaTasha Jenkins is a former American sprinter who tested positive for nandrolone in 2006

And this is mainly track and field. I haven't even scratched the surface of the doping cases in the NFL or Baseball!

It is very interesting when any American throws the doping allegations at others - maybe it's because they are intimately familiar with the idea of doped up athletes and just can't believe that they are not the supreme country in something.

Sign The EPA and then negotiate afterward?

2008-08-12T11:03:00.000-07:00

I am not sure why anyone would first sign a deal with the hopes of re-negotiating it afterward because to my knowledge, once you sign a contract, it is legally binding so if there are things in there that one does not like - don't sign.

The Jamaica Observer today carried the article Caricom hopes to renegotiate EPA which says:

Caribbean Community (Caricom) countries will sign the Economic Partnership Agreement (EPA) with Europe on September 2 as planned, but they are still hoping to renegotiate the deal afterwards

Thank God that the deal is between individual countries and not Caricom as a block because I hope Jamaica won't sign if there are things we want re-negotiated. Gone are the days when business can be conducted on trust and a handshake.

The EU could agree to re-negotiate after we sign and then back out afterward, leaving us stuck with a deal we do not like.

Prime Minister Golding - do not sign it unless you agree with all of it.

Disappointed With Bruce Golding's "Extortion" Remark

2008-08-08T05:39:00.000-07:00

I wanted to wait until after Independence day to comment on Bruce Golding's statement in late July pertaining to auxiliary fees at schools - partly because I wanted to give him time to apologize.

The Jamaica Gleaner ran an article on July 23rd that said the following (School extortion - PM chides institutions for attempting to make auxiliary fees mandatory) :

PRIME MINISTER Bruce Golding has described as extortion, the practice of some schools turning away students who do not pay the non-obligatory auxiliary fees.

Commenting on the vexing issue in Parliament yesterday, a strident Golding told the nation that auxiliary fees are voluntary.

"We are not going to allow schools to find some other ways of extorting," the prime minister said.

It is very unfortunate that he would make such a statement, knowing full well that his administration unilaterally eliminated school fees and then only provides J$5,000 to each school when 5 years ago it was shown that the schools needed at least J$10,000 per student to function properly.

The auxiliary fees are the only way to make up the shortfall and the Prime Minister has now caused major sections of the population to believe that they are being robbed by those fees.

My suggestion to the principals is to run the schools with the government's money and the day it runs out, close the school. The Government of Jamaica is behaving very irresponsibly when it comes to improving our education system and Bruce Golding's comments have hurt the schools, not helped them.

If his heart is truly in improving our education system, he would increase our educational budget so that the schools can function properly without having to charge auxiliary fees or beg for money like people on the street, or encourage parents to contribute what they can.

The only thing that is going to happen under the present atmosphere is that parents will refuse to pay auxiliary fees and then turn around and complain about the low pass rates and poor state of the schools.

It would seem that the Prime Minister has given the schools baskets to carry water.

Green Project Model for Jamaican Inner-City Communities?

2008-08-04T06:06:00.001-07:00

I came across this video thanks Jamaicanresearcher.wordpress.com

David Mullings Interviewed About Jamaican Independence on South Florida's NPR Station

2008-08-02T07:20:00.001-07:00

Check out this video, great history lesson:

170 Years of Emancipation!

2008-08-01T20:42:00.001-07:00

Jamaica is celebrating 170 years since the abolition of slavery in the island. Few people realize that slaves in Jamaica were freed before slaves in the Southern United States of America.

August 1, 1838 was the day when all slaves were freed and the apprenticeship system, established in 1834, was eliminated, 2 years earlier than planned.

The famous Jamaican song 'Augus Mawnin' is all about that newfound freedom.

Learn all about the struggles for emancipation and the full history here.

Re: The Jamaica Gleaner's "Say it loud, say it often"

2008-07-30T06:19:00.000-07:00

Yesterday the Gleaner carried this excellent column: Say it loud, say it often by Colin Steer and this is my feedback.

I agree with the content of your recent column titled "Say it loud, say it often" because while Jamaica needs short, medium and long-term solutions, very little seems to have been really done in decades and yet we expect something different. When I was in high school in the 1990's, Bounty Killer had a hit song called "Look into my eyes" and the lyrics pointed out exactly what the problem was, lack of opportunity.

Look into my eyes, tell me what you see?
Can you feel my pain? am I your enemy?
Give us a better way, things are really bad,
The only friend I know is this gun I have.
Listen to my voice, this is not a threat
Now you see the nine are you worried yet?
You've been talking 'bout' you want the war to cease
But when you show us hope, we will show you peace
Look into my mind, can you see the wealth?
Can you tell that I want to help myself?
But if it happen that I stick you for your ring
Don't be mad at me it's a survival ting.

While there are critics of Dancehall, what has been done since the 1990's to address the issues he rightly brought up in that song? Without opportunities, young men have been left no choice but to take up a life of crime. When the PSOJ toured some inner city communities, some people were surprised that Jamaicans actually live like that but didn't we all know that some of our brothers and sisters have been neglected for so long or were we not paying attention to our own country?

I often speak of 3 Jamaicas - Uptown, Downtown and "Country". We have ignored the "Downtown" part and it has essentially become another country, away from the eyes of many. Where are the TV specials showcasing the plight of the inner city residents, the hardships they face and the lack of opportunity? Where are the Jamaicans who put their money where their mouth is and actually invest in upliftment?

There are some, but too few in number to turn the tide.

Many of us have a real chance to make a difference, even on a small scale, one person at a time, but we are not taking advantage of it. I have had the opportunity to speak with many inner city residents and musicians. Hearing their stories and seeing some of these places hurts me as a Jamaican who is proud of the impact of my culture on the World stage. I remember visiting numerous business owners and learning about their entrepreneurial activities and what they felt they needed in order to move to the next level. The hardworking people I met at places like Coronation Market need a helping hand.

We need people and companies to invest in businesses, not loans, angel investors and grant programs. We need mentorship programs in the communities to expose young men to positive role models, internship programs for inner city youth, startup incubators, book clubs to encourage reading and jobs set aside for those from those areas who have worked diligently to better themselves in terms of formal education.

I am not calling for handouts, I am calling for real opportunities. We cannot continue to make the excuse that they lack the skills or they are not educated enough - train them and help to educate them, otherwise it hurts the entire nation.

You cannot talk down to a segment of the population that has never really been listened to. Until we see these Jamaicans as truly "Out of Many One People" and recognize them as our brothers and sisters, Jamaica will never be able to "play her part in advancing the welfare of the whole human race". I grew up reciting our National Pledge every day in prep school and I was taught to take it seriously. When I said that "I pledge the love and loyalty of my heart, the wisdom and courage of my mind, the strength and vigour of my body in the service of my fellow citizens", I meant it and I have worked hard to live up to that in everything I have done and continue to do.

I know that there are more people like me out there and we need to come together and work as one. We have countless Jamaicans at home and in the Diaspora that want to give back by investing in social programs and businesses. I attended the recent Diaspora conference as the Youth Spokesperson for the Southeast Region of the USA and that allowed me to make some great connections but the time for talk passed when I was a child and now at 27 I have not seen the kind of progress I envisioned when I graduated from high school in 1996.

I applaud the companies that have made positive contributions to our national development and job creation. We need more of them and we need to support those companies.

No one is asking for a handout, they are asking for a better way and unless we provide it, as Bounty rightly says, "it's just a survival ting."

Olint Suffering From a "Run On The Bank"?

2008-07-18T12:31:00.000-07:00

David Smith has rightly pointed out that no financial institution can survive a run on the bank. We can look at recent examples such as Bear Sterns, IndyMac Bank and Northern Rock.

When an institution suffers from a crisis of confidence, depositors start withdrawing their money quickly and sometimes the crisis is due to false rumours - but then the reality of rapid withdrawals makes the rumours self-fulfilling.

Even if Olint has been on the up and up, the confidence crisis that has ballooned due to the lack of payments in recent months would lead to serious problems. There are some questions that need answering for us to get the full story:

(1) Why has Olint been unable to make interest payments for the last few months?

(2) Why did Olint move its operations outside of the jurisdiction of Jamaican authorities once it was served with the cease-and-desist order instead of complying and getting licensed?

(3) Which bank reported the wire transfer and why?

(4) Has Olint followed all International KYC regulations (Know Your Customer)?

(5) Has any local bank refused to cash Olint cheques? If so, why?

I know for a fact that US authorities have been investigating Olint and other investment clubs because of money laundering concerns. To my knowledge the investigations have to do with dirty money being put into schemes in Jamaica, not the schemes using money for illegal things.

Jamaica is considered a high risk country for money laundering activity.

See Jamaica seen as high risk for money laundering (2007) and Kingston Declaration On Money Laundering (1992).

Olint can achieve high payouts through Forex trading - no one questions that, they just question consistent high payouts.

More importantly, I do believe that a Jamaican could be smarter than traders elsewhere and provide great returns consistently, but all regulatory compliance should take place and it would be imperative to keep a high level of confidence among club members if the institution is to survive.

If Olint suffered because it could not increase the number of members, that indicates a problem. That limit however doesn't have to affect the amount of money being brought in because I could have just given my friend money to add to their account, so getting more money to trade most likely was not a problem.

I close by saying that I give David the benefit of the doubt but I have always been concerned about high payouts. I hope he is vindicated and makes Olint very transparent so the rumours can end.

Otherwise people will say that just like the many MLM (multi-level marketing) companies in the USA, a person can run an entity that looks very normal on the outside, conducting everyday business, but somewhere in there is a problem that does not add up and depends on exponentially increasing the membership to generate money to pay members.

Jamaica Labour Party Launch New Website

2008-07-15T10:49:00.000-07:00

The JLP, the current party in power in Jamaica, has launched a new website and I have to admit, they certainly are with the times.

See it at JamaicaLabourParty.com

They have news, video, blogs, live chat and links to external sites such as Facebook, YouTube, MySpace and Flickr - taking real advantage of the web.

It seems that someone has learnt much from Obama. I wonder if the PNP plans an upgrade now?

Maybe this is an indication of the JLP's plans to bring positive change to the country and leveraging technology for the betterment of Jamaica.

Or I could just be reading way too much into it :-)

Buy a Villa on a Private Island in Jamaica For US$2.5 million

2008-07-15T07:02:00.001-07:00

I came across this yesterday: Pellew Island Villa, Jamaica

They are building 4 villas on an island off the coast of Port Antonio and you can have one today for a mere US$2.5 million.

Watching foreigners buying up the USA right now, and what has happened to Jamaica in the past, will we be seeing more and more of our real estate going to wealthy Europeans and people from the BRIC countries?

Jamaica Observer Blog Dead?

2008-07-13T12:43:00.001-07:00

I was so happy when the Jamaica Observer launched it's Jamaica Observations blog - finally a media company in Jamaica was making some strides into the 21st century, their websites after-all are way behind the times.

It seems that this happiness has been short-lived, I haven't seen an update since June 23rd, woefully inadequate for a blog of that level and visibility.

I was taught that if you are going to do something, do it right, or don't do it at all. This blog has provided some great material, some of which even made it into the paper itself.

I hope the reasons behind the pause are sorted out and it gets back into a regular rotation, otherwise it just looks like a half-assed attempt at trying something that is getting a lot of buzz.

My business school experience made it clear that priority-level, accountability and commitment were integral for any project to succeed within a large company.

Is the Jamaica Observer committed to it's blog?

He that keepeth his mouth keepeth his life

2008-07-09T07:20:00.000-07:00

This is a direct quote from an article in the Jamaica Observer today regarding the ongoing investigation into the assassination of Douglas Chambers, Chairman of the JUTC.

The area has been tense since Saturday. In fact, when the Observer sought to get information on Monday, the residents were unwilling to talk about the incident.

"He that keepeth his mouth keepeth his life," a female resident said Monday.

The full article is at Alleged informer told nothing, police say.

The "informer fi dead" culture in Jamaica must change if we are to make any headway in solving crimes and the requires serious work on the part of the Govt. and the Police force. The distrust of authority and the clear inability of the police to protect witnesses in past cases are serious problems.

Add to that the fact that some of the members of the police force are themselves corrupt and involved in illegal activity.

OLINT Feeling The Heat

2008-07-07T06:22:00.001-07:00

The Jamaica Observer carried this article last Friday - Olint under US pressure.

How comes the Jamaica Observer can have such great investigative articles into Cash Plus and Olint yet the Jamaica Gleaner doesn't have even a peep?

I am also not surprised by the article and complaint, but the most interesting parts were the following:

The NFA said that as part of its investigation, it asked I-Trade to provide Smith's personal bank records. "However, I-Trade claimed that it was unable to obtain Smith's bank records and, therefore, withdrew Smith as a principal on December 31, 2007 and repaid his membership interest in the firm," said the document.

According to the NFA, "highly suspicious activity occurred in a number of I-Trade's customer accounts between November 2006 and April 2008. Most of the suspicious activity occurred in the accounts related to Smith (ie, Olint and TCI) and involved activity identified in both NFA's Interpretive Notice and I-Trade's own AML (anti-money laundering) programme as "red flags". This activity included extensive and unexplained wire activity; deposits followed by a request to transfer the funds to a third party without any apparent business reason; and unexplained, extensive wire activity with very low trading levels in the accounts".

"During the first two months this account was open, no trading activity occurred; however, during this time, Olint made four deposits totalling approximately [US]$59 million and eight withdrawals totalling about [US]$35.5 million."

So we have "red flags", inability to obtain the personal bank records of the principal of a company and no trading activity during the first two months the Olint account was open yet withdrawals of US$35.5 million after deposits of US$59 million.

The big one for me though is:

NFA's review of the activity in these accounts, as well as other accounts at I-Trade, revealed suspicious activity, which I-Trade failed to report by filing a Suspicious Activity Report with federal authorities

Giving Olint the benefit of the doubt, David Smith has said that he never risks most of members' money via trading so it can be argued that "While trading occurred in these accounts, only a fraction of the account equity in these accounts was used for trading" backs up his assertion 100%.

It is also well-know that leverage will provide outsized returns, in the months that are up.

So which is it?

I must admit that I was skeptical from day one when I was first asked to explain how Olint could possibly provide such high returns in such short periods. I have seen nothing that has convinced me otherwise, only evidence that large gains are possible, not large consistent gains.

My thing is this: If everything is on the up and up, why not be transparent like all regulated institutions, present your personal bank records when asked and operate within the law.

Air Jamaica Now A Better Acquisition Target?

2008-06-25T07:22:00.000-07:00

Today's Jamaica Gleaner carries the following story - Gov't to absorb $86b Air Jamaica debt.

I am not surprised because if I was going to bid for the airline, knowing that the Govt. was dying to get rid of it, I would use my negotiating skills to get as many concessions as possible and one of them would be reducing the debt load I take on.

The divestment plan has obviously not been going well and they finally realized that no one wants a debt-ridden company that has never been profitable.

Who do I think will bid for the airline now?

Michael Lee-Chin
Virgin
Eastern Caribbean Multimillionaire (probably from Barbados)

My money is on Lee-Chin to strike a partnership with Virgin and share the risk. His push for high-end tourism fits perfectly with Virgin Atlantic's brand and experience.

Would it still be called Air Jamaica though?

Would Lee-Chin go it alone without a major airline partner?

The Jamaica Gleaner Does Air Jamaica Wrong With Sensationalist Headline

2008-06-13T07:20:00.000-07:00

The Gleaner's article today stating "Air Jamaica Bankrupt" makes it's agenda quite clear for those who did not know already.

While I too speak about the burden of the airline and the need for divestment and redeployment of that badly needed capital, I do not use sensationalism and potentially problematic headlines to make my case.

There are lots of companies that operate with "more in liabilities than its assets were worth" and before turning a profit. Amazon.com lost money for 7 years and it's assets were never worth more than the liabilities (it benefitted from venture capital).

Look at them now.

Granted Air Jamaica has a history of losses and is no Amazon.com, but one should consider the consequences of such a headline.

While the definition of "bankrupt" is correct, Air Jamaica has not filed "bankruptcy", but few people know the difference. I can only imagine the calls to Air J with people asking if their flight is still on.

Responsible journalists would go for a less sensationalist headline. I am very disappointed with this kind of headline meant to sell papers and scare people.

p.s. I sent this as a letter to them today. I wonder if they will publish it?

Jamaican People and Businesses Must Play Their Role In Fighting Crime

2008-06-09T07:56:00.001-07:00

I read about the Jamaican pubic crying out for the government to make a real effort to solve the crime problem and corporate Jamaica is doing the same thing.

What I don't hear however is the affirmations to play their own roles in making this a reality. Governments need money to pay for policing and that money usually comes from tax revenue. Audley Shaw once again pointed out some disturbing facts at the recent economic forum.

Jamaican people need to:
(1) Pay their taxes - Cheating the government of the money it needs and then complaining about poor services and policing is hypocritical. Less than 250,000 people in Jamaica pay income taxes, with more than 220,000 of those being on the PAYE system, meaning that they pay taxes BEFORE they get their paycheck.

(2) Supporting the police by providing information - The "informa fi dead" culture is rampant and continues to be promoted. Nobody whose family member has been a victim would ever support such a stupid notion.

Corporate Jamaica needs to:

(1) Pay their taxes - "Corporate income tax accounts for 68 per cent of the arrears" and "One per cent of the firms account for 75 per cent of income tax". That makes no sense whatsoever. Corporate Jamaica needs to pay up because that is the money that trains the police, hires new officers for an understaffed force and allows upgrades to increase the efficiency of investigations.

Add to that the fact that these very same companies are calling for a tax rate reduction when they don't even pay their taxes anyway!

(2) Reduce the interest rates collected on national debt - The largest holders of Jamaica's national debt are Jamaican companies. Is the almighty dollar and the pursuit of profit more important than facilitating a a positive business environment? Lowering the interest rate by 1% saves J$5 Billion, money that can also go towards policing efforts.

There is a lot of blame to go around for the growing crisis and while the Government deserves much of it, the people of Jamaica and Corporate Jamaica must share some of the blame.

Ban All Dual/Multiple Citizens Or None At All

2008-05-23T06:10:00.000-07:00

I have followed the citizenship debate since day one and I do agree that the law is a shackle and should be followed.

However, I believe that the Constitution needs to be updated to reflect fairness for all rather than selective preference.

The fact that Commonwealth citizens can sit in Parliament is clearly a hold over from the days of colonialism and has no place in the Constitution of an Independent Jamaica.

I believe that Jamaicans have two choices: Ban all people with dual/multiple citizenship from sitting in Parliament or allow all of them. You cannot have it both ways and claim to be a country of equality.

It cannot be fair that a person born and raised in Jamaica who now has US citizenship cannot sit in Parliament yet some foreigner who spends a limited time in the country can. Many words come to mind to describe such a rule and they are not flattering.

While I am a dual-citizen and believe that some of us can make contributions in Parliament, I see the issues that can arise and the perception that is created with "one foot in, one foot out".

I have also seen some people clearly show a bias against Jamaicans with US citizenship, claiming that they are "nothings abroad" and merely want to come to Jamaica to be "big somethings", but that is grossly incorrect in the cases we are facing today. Most of these MPs did not fly in from America to be elected, they have been involved in politics for years, while being based in Jamaica and helping people in their respective areas.

A discussion about the possible benefits of dual/multiple citizens in Parliament, elected by the people, could go on forever because there are potential benefits and potential drawbacks that are very real so neither side will win.

The important thing in my opinion is to fix a Constitution that clearly is a legacy of British rule. Whichever way it goes doesn't matter to me as much as making it fair.

If dual-citizens cannot sit in Parliament, we will simply find other ways of continuung to support Jamaica in positive ways.

Fighting Crime Provides The Best Return On Investment For Jamaica

2008-05-19T05:33:00.000-07:00

All governments face decisions on how to allocate scare resources and the decision is usually based on the projects that provide the best return on investment but more often than not, politics plays a bigger role.

The current government of Jamaica has interesting plans for the future of Jamaica but I believe that nothing can provide a better return on investment than investing in reducing the crime rate and especially the murder rate.

A better healthcare system only means that we can treat gunshot and stab wounds more efficiently. Free tuition means that when violence flares up in a community and children have to stay home, the parents are not the one's wasting money, it is the tax payers (hopefully the parents are taxpayers too but based on the recent numbers, that seems overly optimistic).

Jamaica cannot become an offshore financial centre, a top destination for high-end tourists, a more attractive location for overseas companies to invest or a major player on the casino circuit if crime, especially murder, is not curtailed.

Does anyone doubt that Jamaica's future is predominantly determined by the level of crime?

More citizens will continue to leave in order to take advantage of opportunities outside of Jamaica if jobs are not created and the country becomes less safe. More people in the Diaspora will choose not to return to Jamaica after retirement for the same reasons.

Also, a country cannot be so dependent on remittances, an "industry" that is entirely dependent on the economies of the sender's country. The economic slowdown in the USA undoubtedly has had some impact, add to that the rising costs of food and fuel, which means an increased cost of living that disproportionately hurts lower and middle-income earners, the main source of remittances. It is entirely possible that the growth of remittances actually lulled previous administrations into complacency, removing the urgency for needed reforms that would help to grow the local economy.

Grow the economy by reducing crime because that makes Jamaica more attractive to internal and external investors, which means more jobs, more tax dollars and more opportunities for all.

Jamaica must fight the insurgents

2008-05-10T13:06:00.001-07:00

Some people will say that using the word "insurgent" to describe our gunmen, a word popularized by the Afghanistan and Iraq wars, is too harsh, but I beg to differ. An insurgent is defined as:

* a person who takes part in an armed rebellion against the constituted authority (especially in the hope of improving conditions)
* guerrilla: a member of an irregular armed force that fights a stronger force by sabotage and harassment
* in opposition to a civil authority or government

Surely our gunmen and armed gangs are easily described by the above. While I am glad to see the authorities making some moves, I believe that we need a new approach, a counter-insurgency approach. These are no ordinary criminals and the current policing strategies have proven woefully inadequate to solve our gigantic crime problem. Every Jamaican should feel some shame in having such a high murder rate, especially for a country that is not at war nor has armed guerillas hiding in the hills trying to overthrow the government.

If the money can be found to free up education and healthcare, it must be found to solve our crime crisis because nothing impacts healthcare costs and education than crime. Children in volatile areas have had to stay home from school and our hospitals and clinics treat far too much gunshot victims for such a small nation.

The time has come and gone to declare war on those who have already declared war on us. It will also not suffice to merely deal with the small and medium players, the big fish must fry too, even those with political connections. Rooting out corruption on both sides of the aisle must be part of the strategy and it is high time that criminals start to feel the fear that they have instilled in us Jamaicans.

I in no way advocate extra-judicial killings and expect that the authorities will involve people with expertise in combating these kinds of hardened and heartless criminals. Lastly, if new opportunities are not created for the youth, especially the many young males, dealing with the current criminals will only result in the void being filled by new criminals.

The surest way to reduce crime is to facilitate job creation and skills training and this government seems to be on the right track in that regard. More involvement from NGOs and the private sector is needed however to truly transform the landscape in Jamaica to one of opportunity for all.

I pray for Jamaica and my fellow Jamaicans everyday. I do not believe that God ever allows one to encounter more than they can handle and while you may question why something bad happens, down the line you look back and see how it helped you become a better person. I believe that Jamaica as a nation will be much stronger in the future thanks to the hardships of the present.

Naive statement about Hip-Hop vs. Dancehall

2008-05-09T05:14:00.001-07:00

This article today greatly hurt the credibility of the writer and marred what was otherwise a good article.

He said that "I believe hip hop artistes know just how far to go and they never push the envelope" in an effort to counter the argument that dancehall is similar to hip-hop in content.

He noted that some people said that "American hip hop music as falling within the same genre and how it was not frowned upon by the Americans" which also indicates a serious lack of the facts. A basic search on Google for "hip hop backlash" (see results here) turns up this article as the top find: Hip-hop faces increasing backlash.

That article alone destroys BOTH arguments put forward anyone who has actually paid attention to hip-hop since inception can attest to the fight it has gotten, from the days of NWA to "gangsta rap" and the big issue of 2004, rapper Nelly swiping a credit card between the bottom of a black woman in a hip-hop video (see Black college women take aim at rappers).

Americans have ALWAYS confronted aspects of Hip-Hop music and you would have to live in a bubble to not have known about the Tupac vs. Biggie story that the media used to show the negative aspects of rap music, the 2 Live Crew court case in Broward County in 1990 because of the release of their album "As Nasty As They Wanna Be" or the hearings on Capitol Hill.

Rap music and those hearings are one of the primary reasons the USA has parental advisory labels on CDs now, thanks to Tipper Gore (wife of Al Gore). Read Rap, Rock, and Censorship: Popular Culture and the Technologies of Justice by Mathieu Deflem to learn more.

I don't take argument with the overall point of the article, just the ridiculous assertion that "I believe hip hop artistes know just how far to go and they never push the envelope".

Obviously Mr. Dennie Quill doesn't think the credit card butt-swiping pushed the envelope.

My thoughts on the budget

2008-05-06T17:49:00.000-07:00

The budget presented by Shaw is an election budget and will not hold up over the next financial year because of a fundamental flaw which Omar Davies rightly pointed out:

"an anticipated deceleration in rate of increases in international commodity prices""

That was one of the biggest assumptions used in creating this budget, establishing an inflation target of 9-10% and assigning expected expenditure for oil, etc.

Does anyone in here believe that commodity prices will decrease in 2009?

Oil keeps climbing, food prices keep climbing, biofuels are putting even more pressure on food crops and China and India are just hitting their strides in terms of demand.

By the way, inflation in Jamaica for 2007 was 16.8% and close to 20% for the fiscal year 07/08.

The budget is financed mainly through debt and that debt is being issued at variable interest rates in the local market ($130 billion), which means that the ultimate size of dependent on inflation since investors ALWAYS want to account for inflation.

Contrary to popular belief, most of the national debt is held by LOCAL investors, not foreign ones.

$44 billion in new tax intake? HA, this I have to see. I have zero confidence that this much will materialize. It's nice to have big goals to aim for, I commend that, but you also need to have a back-up plan with more realistic numbers.

I hope that they have a back-up plan they are not telling us.

Lastly, the Jamaican dollar is pegged to the US dollar, a dollar that has weakened significantly against all major currencies and continues to weaken.

This weakening has not yet taken into account the inflationary pressure from the Fed's bailout of Bear Stearns. Any money for the any portion of losses from the US$29 billion of guaranteed money for losses will have to be PRINTED out of thin air.

This would hurt the Jamaican dollar because printing more US money reduces the value of the money supply in the hands of the public, thus reducing the value of our dollar.

If the Jamaican dollar's value continues to decrease slowly, it increases the price of exports and pushes our budget up.

I also predict that the new cigarette taxes will result in less tax revenue overall. I think that the combination of inflation and higher price to consumers have adjusted the point on the supply/demand curve to a point where more consumers will drop out than can be made up for by the increased revenue per person.

e.g. $1 tax, 100,000 consumers = $100,000 tax revenue
$1.50 tax, 60,000 consumers = $90,000 tax revenue

Granted that is VERY over-simplified, but that is the idea - increased costs reduce the number of consumers and I think this increase is major because the REAL increase is not just the tax increase, but the inflation increase as well.

For all the reasons above, and more (increase in expenditures thanks to freeness, the bigger pork barrel fund), I believe that this budget will continue the tradition of being overly optimistic, but will miss projections worse than any previous PNP budget.

Let's hope that I am wrong.

Good links:

THE 2008 BUDGET DEBATE OPENING PRESENTATION BY THE MINISTER OF FINANCE AND THE PUBLIC SERVICE, HON. AUDLEY SHAW

BUDGET PRESENTATION BY DR. THE HONOURABLE CHRISTOPHER TUFTON, MINISTER OF AGRICULTURE, APRIL 2008

2008/2009 BUDGET PRESENTATION BY DR. OMAR DAVIES

PRESENTATION OF THE MOST HONOURABLE PORTIA SIMPSON MILLER, LEADER OF THE OPPOSITION TO THE BUDGET DEBATE 2008

Focusing on Brazil, Russia, India and China is Smart

2008-04-27T18:24:00.001-07:00

I must commend the move to forge closer relationships with China in terms of tourism opportunity. We should not leave out the other BRIC countries - Brazil, Russia and India - as so named by Goldman Sachs in 2001. Brazil is known to be a large Reggae market and Jamaica obviously stands to benefit tremendously by tapping into that heritage and providing appropriate attractions.

For those who doubt the soundness of targeting these countries, Goldman Sachs recently released a report these 4 countries will contribute almost half of all global growth in 2008 and 2009. There is no doubt that the middle-class in these countries and growing, people are getting wealthier and their disposable income will undoubtedly partly be used for vacations to new parts of the World.

Jamaica has one of the strongest brands in the World and I do not doubt that we will stand out in the minds of the Chinese when we take to the track at the coming Summer Olympics in Beijing. Stereotypes about Chinese and Indians have no place in the globalized World of today. Jamaica must think like a luxury goods maker - go where the money is. Moscow boasts one of the highest concentrations of Billionaires of any capital city in the World according to Fortune magazine and India had 53 Billionaires on the most recent Forbes list of the World's billionaires.

Do we dare NOT make a real attempt to raise the profile of Jamaica as a quality destination in the BRIC countries? We should be confident enough about our country and our tourism product to reach out to anyone. More importantly, with the expected opening of Cuba, we need to move quickly to diversify our customer base like any well-thinking business. I hope that more Jamaicans will do research on the BRIC countries before writing them off based on outdated stereotypes.

So that's where the money is going to come from

2008-04-13T07:36:00.000-07:00

I recently wrote a post, Golding Florida Town Hall Meeting Review, that pointed out that the most important question concerning Jamaica was not asked:

Where was the money going to come from to pay for free education and free healthcare?

We got our answer during the budget presentation.

Increased taxes on motor vehicle registrations and cigarettes.

I hope that the citizens of Jamaica realize that there is no such thing as a "free lunch" and they ALWAYS end up paying for freeness if the economy does not grow and provide new revenue for the Government.

Too many people are quick to rejoice when they get "freeness" from the Govt. without first asking how it is really paying paid for. I think that stems from the relative lack of understanding basic economics amongst the population. A country that graduates more than 15,000 students each year that do not pass A SINGLE SUBJECT surely produces a large group of people that cannot grasp economics.

Maybe that is why the Govt. focused on making education free rather than improving the quality - keep the masses in the dark and they can't ask the right questions.

Following up on that, now that a J$1.5 billion hole has been created by the reduction of stamp duty and transfer taxes on real estate - a much needed reduction - how does the present Govt. intend to fill that gap?

Jamaican Athletes Get Gold Medals thanks to IOC decision

2008-04-11T05:36:00.000-07:00

It is well-known that Jamaica's track and field athletes are among the best in the World and during the 2000 Sydney Olympics, we won Silver medals in the 1,600 m relays.

The winning team was the USA, a team that included a doped up Marion Jones. US athletes have frequently been accused of doping and a number of them have been caught. A good!

The members of the Jamaican team will now receive gold medals instead of silver thanks to the disqualification of the cheating US team.

Congrats Jamaica, all natural performance and excellence wins again.

Tax Revenue Opportunity: Hemp Production in Jamaica

2008-04-08T06:45:00.001-07:00

The statistics provided by Prime Minister Bruce Golding at the town hall meeting in Florida were very disturbing and I have been thinking about ways to address some of the challenges our beautiful country faces.

One idea that I propose is based on what Canada has managed to do by legalizing and regulating a hemp industry.

Hemp is often confused with marijuana, both members of the Cannabis family of plants, but distant cousins. Hemp is one of the most useful plants, the seed of which are used to produce healthy food, nutraceuticals, and bodycare products and the stalk is starting to be processed into high performance fibre products, such as paper, textiles, biocomposites and building materials.

Canada has been growing industrial hemp seed since 1998 and a vibrant, regulated industry has developed, supplying domestic and international markets. Jamaica's climate has proven to be ideal for the cultivation of Cannabis and should be a comparative advantage in comparison to the Canadian climate. Hemp is a fast-growing, year-round crop that leads to the production of environmentally friendly products.

There are obviously many Jamaican farmers who grow ganja in order to survive so they possess the required knowledge to grow hemp and this new industry would allow them to become part of the formal economy. This new industry is positive for the Jamaican economy in a number of other ways:

Employment - This industry creates jobs on farms, the distribution chain and the marketing chain. COmpanies founded to market the crop internationally will also generate jobs. The Democratic Presidential candidates in the USA have recently been talking about "green collar" jobs, jobs in renewable industries. A hemp industry in Jamaica creates green collar jobs for Jamaicans.

Tax revenue - Licensing fees and income tax on companies and employees will generate real tax revenue for the Government. Jamaica has a severe problem collecting taxes and this industry helps to increase taxes collected from businesses and individuals.

Export growth - Jamaica suffers from a trade deficit, importing more than it exports. This trade imbalance is not desirable and a vibrant hemp industry will provide a new export crop that generates foreign exchange and reduces our deficit.

Economic growth - Jamaica can either reduce spending or grow the economy in order to climb out of the hole it is currently in. The latest budget increases spending (partly because of inflation of course) and while the Government will do its best to reduce expenditures by divesting some assets, growing the economy is still the best option. Growth is fuelled by productivity and industries.

The USA has weighed in on calls to legalize ganja in Jamaica but I have yet to see a hemp proposal put forth. Under Canadian regulations, hemp is classified has having less than 0.3% THC, the primary psychoactive ingredient in marijuana, making it unsuitable for drug and therapeutic purposes. If Canada could manage to facilitate a hemp industry, surely Jamaica should face no objection from the USA.

I am asking the Government of Jamaica to undertake a serious study of the potential for a hemp industry in Jamaica based on Canada's system.

Amnesty International launches damning report on Jamaica's Inner Cities

2008-04-02T05:48:00.000-07:00

Jamaicans already know about the issues faced by residents of inner city communities, now the whole World will get a peek, provided by Amnesty International, not any local organization.

The article page includes a short video on the topic and I recommend you watch. The article starts off with something few of us can deny:

"Poor inner city Jamaicans are left at the mercy of gangs and abusive police officers who are rarely, if ever, brought to justice for human rights abuses."

Amnesty International:
Gangs and police cripple Jamaica's inner cities

Download the report: HTML and PDF

The BBC picked up on the news release and carried the following article yesterday: Jamaica poor 'at mercy of gangs'

The BBC says that "Jamaica's poor have been abandoned by the government and left to the mercy of violent criminal gangs".

Prime Minister Bruce Golding has responded to the report - Golding pleads with Amnesty. Here is a small piece (read the article for the full story):

"I urge you to be sympathetic to the real difficulties faced by a Government that must find $723 million each day to service the national debt. You will, I am sure, appreciate the extent to which this constrains our ability to address the urgent need to provide social services and economic opportunities in these areas," he said in a statement released yesterday.

I will respond to the report after I have read and digested it properly.

Golding Florida Town Hall Meeting Review

2008-03-31T07:52:00.001-07:00

As a young Jamaican who is intent on helping Jamaica and my fellow Jamaicans, Bruce Golding’s visit to South Florida and the town hall meeting at Nova Southeastern University was very welcome.

The Jamaican Diaspora is keen on getting answers from the leaders of the country and playing their part in development, not just sending remittances. This was the first time I had ever attended a speech by Golding and especially looked for the question and answer session that was slated to take place.

The Prime Minister certainly was charismatic and received numerous rounds of applause when talking about combating crime, rooting out corruption and explaining his vision for a better Jamaica. He provided some statistics that I found quite shocking:

• Personal income tax in Jamaica is collected from approximately 245,000 people on PAYE, with the rest coming from only about 4000 people
• 70% of all corporate income tax is paid by only 2% of registered companies
• Jamaica barely collects enough taxes to service debt obligations and money has to be borrowed for everything else (fill potholes, pay police, etc.)
• Upwards of 30,000 students “graduate” each year from high school with 3 subject passes or less

Clearly Jamaica has a problem with tax evasion and the quality of the education system – no news to anyone who pays attention to the news – but the tax numbers were more surprising than I expected. Golding spoke about the need for increasing tax compliance but provided no concrete details, granted, I was not expecting details.

The question and answer session was both refreshing and disappointing because while it presented a platform for an investment banker from Saudi Aramco and the CEO of a Telecom company to talk about investing in Jamaica and needing to make contact with the government, no one took the opportunity to ask questions that I felt needed to be answered:

• The poor handling of Air Jamaica - it has come across as being wound down, not being primed for an acquisition
• Addressing the QUALITY of the education and health systems before making them free – I do not believe that free access to poor systems can be a good thing
• Where is the money coming from to pay for this new “freeness”?

I hope that each of these will be answered in the future and while I believe that Golding has already made some mistakes, I do believe that we share a vision and I should give him a chance. Before Friday night, I had always wondered if I should trust Golding but the town hall meeting, his speech and his handling of the questions managed to change that – I trust him more than most politicians. I only hope that he will work hard to keep that trust.

Cash Plus not paying out March 31st. Surprised?

2008-03-29T15:54:00.000-07:00

The Jamaica Gleaner's leading article today is No March payout - Cash Plus can't meet obligations and I certainly am not surprised by this.

i hope that it makes more people realize that something is a little fishy. A company claims that it is not a pyramid scheme and merely seeking loans to do business, willingly paying exorbitant rates for those loans. However, as soon as the company can no longer take in new money, it can't pay out interest to people.

Hmmm.....

Consequently, one must then conclude that said company has been severely impacted by the inability to take in new money. Only one kind of organization requires new money to pay interest on old.

Also, why has Cash Plus not applied to the FSC as yet, after withdrawing the lawsuit from the courts and saying that it is willing to comply?

I have had my doubts since day one, written my letters, blogged about it, and this only serves to strengthen my beliefs. I will admit that some miracle could take place that gives me evidence that Cash Plus is in fact legit - but until it can pay out interest regularly, without taking in new money, the evidence points to an organization of a different kind, one that Jamaicans would be much better off without.

The Jamaican media against Air Jamaica?

2008-03-20T19:31:00.000-07:00

There is no doubt in my mind that the Jamaican media has had its eyes set on Air Jamaica since the JLP won elections last year. I myself have sent a number of letters, both outlining reasons privatization make sense, as well as praising the service I received on my most recent flight 2 weeks ago.

Without fail, my letters that could be used against Air Jamaica have consistently been published while the more positive ones languish in an editors inbox, never to see the light of day in the mainstream media.

The most recent article was certainly surprising and I am shocked at the revelation - we taxpayers certainly need to know about these failings - but I still wish the media would throw in some good stories as well.

The article was titled $250 m to park - Air Jamaica plane accumulates fees in France

Am I the only person who thinks that the media is purposely focusing on negative stories related in Air Jamaica?

One scandal down, One more to go

2008-03-05T16:33:00.000-08:00

So the light bulb scandal has been the big story for the last few weeks and indictments and arrests have been made. Now it's time for Trafigura and some of the bigger heads to talk - well at least talk to the Dutch investigators.

Based on what the Gleaner says (read here), political contributions by Dutch companies are illegal so it should be interesting to see how Trafigura justifies the J$31 million given to the PNP that resulted in the resignation of Colin Campbell.

In terms of local impact, let's see how the PNP will let adhere to the following statement:

"The PNP wishes to reaffirm its stance against any involvement in acts of corruption and firmly believes that the rule of law should always take its course," the release said.

"The party reasserts its commitment to the highest standards of honesty and integrity. We also continue to examine the circumstances whereby the adherence to these standards could have been weakened or compromised."

No Reservations and the Anthony Bourdain hit Jamaica

2008-02-26T15:54:00.000-08:00

For those who missed this great episode that showcased Jamaican food and people, check out the clips below:

Light Bulb saga heating up...

2008-02-05T18:17:00.000-08:00

This cartoon in the Jamaica Observer summed it up quite well:

The Contractor General's report is in and he has made it quite clear that Kern Spencer has some explaining to do, possibly to the police and Director of Public Prosecutions. Check out the various articles listed at the end of the post for the full story. The red flags include:

No evidence of written contracts
No tendering process for contracts
Spencer concealed the fact that one of the project managers was his child's grandmother
Spencer's babymother was a project manager even though she admitted having zero experience
The two companies contracted had no prior business or operational track record when chosen

All the above are more than enough reasons to believe that something is rotten and I look forward to the full story and Kern Spencer's response.

Articles:

Did the PNP administration make a bad deal for the Portmore toll road?

2008-01-24T08:24:00.001-08:00

Today the Jamaica Observer carries an article about the possibility of the doubling of toll fees along the Portmore leg of Highway 2000 and Audley Shaw not confirming or denying this - Shaw mum on Portmore toll increase.

The following from the article bother me:

"NROC, which is a part-owner on behalf of the government, is earning no income because all the income is being earned by the French operators. But we have a debt obligation because we had taken out an instrument of almost US$100 million as our contribution to the construction cost," Shaw said.

So the previous administration negotiated a deal in which they provided US$100 million in exchange for not getting ANY share of the toll from day one? More importantly, this money was from a loan that was taken out? Where was the money expected to come from to service the debt?

On top of all this, the article points more alarming things:

...it was financed at an interest rate of close to 12 per cent.

"You have to bear in mind that this is information that is now coming to us after we have come into power, because the subsidy that was being paid was never told to us in Parliament, or by the previous finance minister or works minister," he said.

I think some answers are in order.

Government to pursue last year's agreement by the previous administration to grant a casino gaming licence to a group of foreign investors

2008-01-24T07:26:00.000-08:00

Today the Jamaica Observer carries an interesting article that has a major impact on the casino debate - Gov't to honour casino licence agreement made by PNP.

My recent post outlined my support for casino gaming in Jamaica based on the Bahamian model. While I welcome the issuing of licenses to foreign investors who will possibly add new rooms and jobs, I expect that local investors will also be granted licenses based on the number of rooms their hotels already have.

This means that people like Butch Stewart, Karl Hendrickson and the Issa family should be in the running for licenses and be able to add casino gaming to their resorts if that is a plan they wish to follow.

Interestingly enough, the JLP Manifesto did not mention casinos at all so I am surprised to see them move so quickly on this topic, but I guess the financial health of the country or lack thereof was more of a surprise than they expected. I welcome job creation and new revenue sources that do not come from tax increases because Jamaica needs every cent it can get right now to improve.

Casinos and Jamaica

2008-01-23T09:12:00.000-08:00

I read the gambling-related articles and editorials with great interest because the topic was discussed at length in my 'Young Jamaicans Unite' group on Facebook. Each contributor had their own perspective but we were forced to conduct research and some of my discoveries surprised me, especially because of the negative effects that most people associate with casinos.

My information is mainly taken from experience, readings and especially a 2005 study by Grinols and Mustard in the USA titled 'Casinos, Crime and Community Costs', one of the most exhaustive studies of casinos and crime in the USA. There is no doubt that the following is would be true of casinos in Jamaica:

* Create new jobs, both for low-skilled and highly-skilled workers (for example: slot machines and other electronic machines require technical expertise for maintenance and programming)
* Provide a totally new source of revenue for the Government (taxes on winnings, wage taxes, mandatory contributions, etc.)
* Attract more tourists

Most people also assume that the negative things connected to casinos are true:

* Increase in crime (robbery, aggravated assault, rape and a few others)
* Increase in illegal gambling (some tourists will play anywhere)
* Increase in prostitution

Some will seek to argue that creation of jobs for low-skilled workers would result in a reduction of crime but the study and others quoted showed that this was a short-term effect and that overall, crimes such as robbery and assault do increase over time with the introduction of casinos, but surprisingly, that murders do not increase in any statistically significant way. More importantly, these studies and further examination of the effects of casinos on US counties, the Bahamas and Macau provide ample information on what to expect and allows our respective agencies to be more prepared to combat the potential ncreases.

The Bahamas has seen 4 main negative trends: Robbery of some tourists, illegal gambling, increase in prostitution and data theft of personal information. Macau provides examples on organized crime rackets and scams.

Macau's rise as the Asian Las Vegas stemmed from it's rich new neighbours such as Hong Kong, similarly to the opportunity Jamaica has to bring in money from the USA, Cayman, Trinidad and Barbados. It is no surprise that Macau has been able to use gambling proceeds to fund such infrastructure improvements such as a new airport, highways, bridges and a new ferry terminal since the gambling industry accounts for more than 40% of GDP.

My trip to Atlantis in the Bahamas a few years ago also helped to shape my opinions as I saw many Bahamians benefiting from the businesses in and around the casino. A contributor to the forum also raised the idea of Online Gambling, similar to what Antigua has become well-known for. The person articulated that crime was not a trait of such gambling, created highly-skilled jobs and was relatively easy to implement.

My sticking point with casinos has always been that Jamaica should put the proceeds into long-term projects that create real competitive advantages, such as public debt reduction, organic foods, pharmaceutical research, ethanol production from sugar cane and the entertainment industry (soundstages for movies, etc.).

With a public debt of 140% of GDP, Jamaica needs to seriously consider all options to earn money and grow the economy. There is no question as to whether casinos can play a significant role in helping to reduce the significant debt load of the country, which in turn benefits everyone. Physical casinos with a tourist-only policy like the Bahamas, coupled with Internet Gambling like Antigua, and investment of some of the money into other areas of the economy is a good way forward in my opinion.

Inner-city employment-business resource centre project could be extended to a total of 10 communities islandwide

2008-01-17T07:53:00.000-08:00

The Jamaica Observer Blog recently posted this story (yes the Observer has a blog): JN's Source inner-city project goes national

This is definitely an excellent example of Corporate Jamaica teaching people to fish rather than just handing out fish.

I hope that is does make it into the 10 communities and then even more after that. It has shown that it works and I hope that it gets more publicity within the island because more people need to know about these positive things. Too often the media is focusing on the negative stories.

Education Reform in Jamaica

2008-01-17T07:51:00.001-08:00

I am glad to see the following mentioned in a Gleaner article on education reform:

...in the years ahead over 75 per cent of education transformation expenditure will be spent on school facilities and infrastructure.

"Through this programme, the Ministry of Education has commenced dismantling the dreaded shift system; reducing class and school sizes; and rationalising the school system into only primary and secondary institutions," Mrs. Jones continued.

Read the entire article here: $250b over two decades to transform education system

Good news for Jamaican football

2008-01-13T08:53:00.001-08:00

The Jamaica Observer blog ran posted that Real Madrid FC will be opening a school in Jamaica this year.

This can only be a good thing and I envy the the next generation. Football seems to be back on the map with Rene Simoes and Capt. Horace Burrell back in their respective seats and this major development.

Go Reggae Boyz, I wore my jersey proudly, even when you were losing.

A response from Don Wehby on the Air Jamaica IPO idea

2008-01-10T05:50:00.000-08:00

The level of support for the IPO idea that I have seen via emails shows that it has legs but Don Wehby gave a definitive answer as to whether it has been considered and what the results are.

He agrees with many of the points made but the problem is that the deficit of Air Jamaica is US$1.1 billion and the Jamaican Capital market could not absorb such an issue. He also pointed out that this is about 2 years of the average fiscal deficit.

However, he explained that they could look at the listing and IPO option AFTER identifying a partner.

That certainly answers the question and closes the debate for me. I am also heartened to know that our officials are actually listening and are willing to take the time to respond.

More investment scheme news

2008-01-09T11:42:00.000-08:00

The post-Cabinet briefing on the report regarding the alternative investment schemes was yesterday and so I expected today's papers to be reporting on the story, but there was more as well:

Gov't to tighten control over unregistered investment clubs - Jamaica Observer

Government walks fine line - Cabinet throws support behind FSC - Leaves room for legal operation of investment schemes in Jamaica - Jamaica Gleaner

Cash Plus clients feel the pinch
- I have to ask what sensible person would put up their car as collateral and to get a loan to put in Cash Plus? Or take out a loan from a bank to do the same?

You are supposed to only risk what you can afford to lose! Why do people believe that it is financially wise to borrow money to put in something that has no real operating history? It's not even wise to put that money in something WITH a history.

Higgins Warner flouts court order to repay investor - I hope people are learning their lessons. How can you not have gotten ANY interest since June 2005? Who is the "prominent Kingston businessman" who supposedly bounced that cheque?

Well, this is the real soap opera in Jamaica right now so let's stay tuned because I know I am hooked.

Air Jamaica trimming staff to increase efficiency or to be acquired?

2008-01-06T06:50:00.000-08:00

The Sunday Gleaner today reported that Air Jamaica offloading staff and that the National Workers Union in Jamaica did not even know about these plans.

I find that interesting because I have known about actual and potential layoffs since mid-November. Everyone knows that Air Jamaica is a management-heavy organization and some trimming had to be done. I cannot speak to the other levels of staff but it seems that the Board has decided to cut staff by as much as 30% according to the Gleaner.

This Board has taken the approach of a typical private equity firm that acquires a company to turn-around. If you look at a deal such as Chrysler, they have laid off a 25,000 workers since Cerberus acquired it. Anyone who pays a little attention to CNN knows that companies in trouble usually resort to layoffs first - wrong or right.

What kind of strategy is the move part of?

The Jamaica Observer reported that there are Four serious bids for Air Jamaica so it makes sense that it is part of a strategy to make Air Jamaica more appealing to a buyer, not to make the airline profitable under Government ownership.

The article is even more interesting because the Government would retain a stake, size not yet determined, and the Air Jamaica brand would have to stay - which I am sure is welcome by every Jamaican.

I hope that some analysis about the health of the company is made public so that we can process the problems better. If the public is made to understand what it would take to make Air Jamaica profitable - how many passengers on each route, etc. and what the numbers are now, then we can discuss the possibilities more clearly. All we have to go on is that Air Jamaica is not profitable on a single route.

Also, does the Government have any assistance program setup for the workers who will be laid off? Finding a new job and source of income in 2 weeks is rather hard in Jamaica. While I do feel some pain for the people who will be laid off, there really are only two options:

- Increase revenues while keeping a lid on costs
- Reduce costs and increase efficiency

Reducing costs must include flying less half-empty planes and that would mean less staff is needed if the number of flights are reduced. To expand into additional cities would require significant capital investments and I do not see the Government pumping additional money for that at this time. This is our tax dollars at work and if the people of Jamaica must choose between money for education, healthcare or crime-fighting vs. keeping Air Jamaica afloat, I doubt they will choose the national airline.

I do not envy the position of this Board at all because Air Jamaica is one of the toughest turnaround cases one could have because of the state of the airline industry. I only hope that if push comes to shove, it would be sold instead of shut down.

Air Jamaica IPO a real option?

2008-01-04T10:31:00.000-08:00

During the holidays I had the pleasure of discussing many issues related to Jamaica at a family gathering and Air Jamaica was brought up. One of the participants in the discussion at the gathering wanted my opinion on whether or not I thought that an initial public offering (IPO) in regards to Air Jamaica was a plausible way for the airline to raise money to continue operating without having to be sold to a foreign buyer. Earlier this year I posted regarding the case for privatizing Air Jamaica but I admit that I had not even entertained this option as a possibility.

I am not sure if the new administration and specifically, Don Wehby, have considered the option of an IPO in which Jamaicans all over the World would be encouraged to buy shares in the airline in order to save it, but I think it has merit and should be considered BEFORE we assume that divestment is the ONLY option. If an IPO was considered, then the Jamaican public is entitled to know what the results of the analysis were.

Jamaicans have complained about the London route being sold, about how important Air Jamaica is to the island and how much the name means. An IPO gives them a chance to put their money where their mouth is and help save our national airline while keeping it in Jamaican hands.

Most airlines in the USA are publicly traded and airlines around the World have used IPOs to raise money. Jet Airways in India used an IPO in 2005 to raise capital and JetBlue was able to raise US$158 million in April 2002 when it floated its IPO, even though it was a very young airline and not always profitable.

There are sufficient Jamaican institutions with experience floating IPOs on the Jamaica Stock Exchange and floating shares of Air Jamaica on the stock exchange would allow Jamaicans to show how much they support the airline.

I fly Air Jamaica every chance I get and I certainly would buy shares if it meant that we could ease the financial burden on the taxpayers of Jamaica AND keep the airline Jamaican-owned. If the support for the national airline is anything to go by, I believe that there are many others who would do the same.

If an IPO turns out not to work because of under-subscription, then surely the Jamaican people would have no one to blame but themselves for any sale and the Government would have a clearer mandate to divest (the clearest mandate of course would be a national referendum after providing a detailed cost/benefit analysis to the public since it is our money afterall and we may want to keep subsidizing the airline until it is profitable).

I would love to see more research done or previous research presented on the possibility of an IPO to raise money for Air Jamaica and Don Wehby certainly has the qualifications to oversee such an analysis. Selling shares of Air Jamaica to the public would certainly be the ultimate embodiment of the "Buy Jamaican" campaign that is so widely talked about. If buying Jamaican is so important, why not allow us to buy into Air Jamaica?

UK court battle alleges bribery in Jamaica, Panama and Dom. Rep.

2008-01-03T15:47:00.000-08:00

The Guardian carried a most interesting article yesterday in the U.K. - Court battle over secret export commissions claims. The article refers to the circumvention of anti-bribery laws by a company owned by one of the wealthiest families in Britain - Mabey and Johnson Limited, a firm that builds steel bridges.

It seems that one of their former employees, Jonathan Danos, is spilling the beans on bribes paid to officials in countries such as Jamaica and how they were made. He specifically names Jamaican businessman Deryck Gibson and outlines how he paid an 8.5% "commission" after being awarded a contract without a competitive bid process.

I think that we need to carry out our own investigation based on these allegations and find out if any politicians benefitted from these kickbacks because that is usually how bribes work and the non-competitive bid process easily raises flags, especially with the history of politics and scandals in Jamaica.

We will see if anything happens at all.

Premiere League and clubs in trouble?

2008-01-02T06:33:00.000-08:00

The Gleaner ran an article on New Year's Day that questioned the future of Cash Plus' sponsorship of the Premiere League. Read it here.

Wray and Nephew's 5-year , $120 million sponsorship was cut short by Cash Plus' 3-year, $150 million deal, even though Wray and Nephew had been a long-time sponsor and far more transparent company that one could safely expect to be around for many more years.

I can't blame the Premiere League for taking the sponsorship though - the clubs need money and corporate Jamaica has not stepped into football enough - but I was shocked to read that clubs could be facing some serious problems and may have to drop out because the Premier League Clubs Association (PLCA) "had reinvested sums collected from the sponsorship back into the investment club."!

Their December payments have not been forthcoming and that is causing some problems.

Now I was always taught that you only risk money you can afford to lose and I am sure that Edward Seaga knows this as well, so why would he as Chairman of the PLCA support a plan that saw the PLCA risking the financial future of members?

The fallout from a Cash Plus crash would be big no matter what, but to drag our top league down with it certainly would not be expected and is beyond anyone's imagination. I expect them to go running back to Wray and Nephew if Cash Plus cannot pay up for the remaining years of sponsorship.

As the saying goes "Not all that glitters is gold". I am sure Wray and Nephewis secretly smiling because it has taught many people an important lesson - Just because you are getting more money doesn't mean you will be better off.

I hope that people learn their lesson from this crunch right now since they didn't pay attention to the other red flags.

Olint, i-Trade FX and David Smith

2007-12-29T10:42:00.000-08:00

I recently conducted some research on a Forex trading platform that is being promoted in Jamaica - iTradeFX. ~~This platform is operated by the company that trained David Smith and has set up an office in Jamaica to offer training courses, MTI - Market Traders Institute.~~ This platform is connected to people that also have interests in MTI, the company that trained David Smith and has setup office in Jamaica to offering training (Editor's Note: A commenter pointed out that the wording of the original sentence was misleading).

We all understand that Olint offers great returns and I just found the following on the iTradeFX website potentially ironic:

You need to be very careful and exercise due diligence. There are growing numbers of international firms offering various approaches to FOREX trading. Look before you leap. Do your homework and check references. Many companies prey on the greedy promising phenomenal returns that are the exception, not the rule! Find a company that doesn't promise the moon. If it sounds too good to be true, it usually is. Reputable firms have credentials.

The bold sentence could be read in different ways.

Certainly, if you do not believe that Olint or other Forex companies are "promising phenomenal returns" or "promise the moon" since there are other companies offering even higher rates of return, then you read this quite differently from the person who does in fact believe that "it sounds too good to be true".

The statement on that website is nothing different from what I or others have said about investing money with anyone. I leave it to you to read the statement how you want as there is no doubt that Forex can generate significant returns but not everybody can be a winner (in fact, the MTI site says that "Most Professional Traders are part of the 10% earning money. The 10% earning money actually receive the 90% money that is lost . If the 90% are paying the 10%, you can easily figure out that the 10% are being paid quite handsomely.")

Updates on Investment Schemes

2007-12-27T07:07:00.001-08:00

I have been away - I love my holidays - and now I am back. I have touched on the investment schemes in Jamaica because I was concerned about the effect they are having on the country at present and the effects that could result from an implosion in one of more.

Here is a December recap in cased you missed it:

Courts rules that OLINT and Lewfam have to be registered with the FSC

The danger of investment schemes was written by a UK-based banker and sought to outline some facts about investing.

FSC receives Cash Plus financial report but report does not provide some of the information that was requested by the FSC - the article also mentions that interest payments due on November 30 have not been received by some and will be paid in the New Year according to the company.

MiPhone pulls plug on Cash Plus' MegaFone - Case in court over indebtedness

I had advocated for registration with the FSC because the companies were all operating outside of any regulation and that could in no way be good for investors. I am surprised that more has not been said about the MiPhone/Megaphone issue because Cash Plus says it has plenty of money and then the plug gets pulled on Megaphone for "indebtedness"?

I have said before that I have heard from more than one reliable source that Olint will be registered by March 2008, but I cannot speak for Cash Plus or any other. I still do not believe that such amazing returns can be consistently achieved BUT one can regulate return on investment, only that they speak the truth.

Last week I read an article in the Harvard Business Review, The Truth About Private Equity Performance, and it made the case that "Private equity fund performance is most often reported in a way that exaggerates the truth. A modified calculation gives a more accurate read of performance and can change a fund's relative rank." Accounting is one of the most flexible professions I have ever seen - numbers can be used to achieve lots of things.

Let us all hope that 2008 will not see a collapse in any of these but transparency will finally reign and investors will be able to feel more secure in their choices. I also hope that morality will come back because it bothers me that some people have said that they don't care if their money was being used for illegal activities, as long as they get their interest.

Gleaner Editorial: Urgent court action needed on OLINT

2007-12-12T13:18:00.000-08:00

With all the recent discussions about high-yield investment schemes, it is no surprise to see this editorial in the Jamaica Gleaner today - read it here.

They are quite right to say that "What is at stake is legal certitude about the status of such schemes and what ought to be the role and responsibility, if any, of the Government in protecting the public from these so-called investment vehicles."

Politics in Jamaica: Warmington style

2007-12-05T15:03:00.001-08:00

So Mr. Warmington felt that he could really go and tell people in Old Harbour that if they did not vote for JLP today, they would not get their hurricane refund cheques?

http://www.radiojamaica.com/content/view/3504/26/

Jamaica Observer Editorial

The Jamaica Observer reports that he said the following on Sunday past:

"Dem talk 'bout Ivan Money, it coming up now. Three thousand a you from Old Harbour Bay expect fe get. You know what a tell de minister sey. I told Minister Charles. Don't send one striking cheque down ya till after Wednesday (election day)," Mr Warmington said. "Don't send none... After Wednesday, what is yours is yours and what is mine is mine. Mek sure de vote is mine."

You have to read the article for the rest.

Honestly though, what would possess a politician in this day and age to say something like that in such a big forum? It is no secret that politicians often feel this way but lawd...Anyway, I glad to see it come to light so quickly and hope that they send him packing roundly.

The JLP should also distance themselves from this man, otherwise his stink begins to rub off on them pretty quickly. There is no place in politics for people like this (and the other politicians, even if they agree with what he said, certainly would not want someone foolish enough to get caught saying it, around them).

More background info on Carlos Hill and jail time

2007-12-05T08:15:00.001-08:00

The Jamaica Observer front page story today is certainly one not to miss - The Trials and Convictions of Carlos Hill

Some changes coming?

2007-12-03T05:34:00.000-08:00

I have decided that I can grow this blog into something like the Huffington Post by really deciding to add more writers/columnists and getting a domain name that a brand can be built around.

I will be posting a guest piece from one newspaper editor who is very interested in blogging and getting his ideas out to the masses with no corporate interference. I am seeking out other such journalists who have years of experience and want new outlets, wish me luck.

This means that we will see a few changes to the site as I re-organize it to be more conducive to finding articles by columnists and embed a little advertising to help them earn some money from their efforts.

I started this to merely give myself a voice and now it will be giving others a voice. Also, with these back-to-back "Letters of the Day", I at least know that I am writing things that are deemed 'worthy for publication' by the Editor of the Gleaner so why not seek to get a much wider readership?

I doubt the blog will move to a new address so the RSS feed will not change, but I can predict the future and I am evaluating other blogging software.

Stay tuned

Jamaica's alternative Investment Shemes would be illegal in the USA

2007-12-02T06:30:00.000-08:00

I attended a Jamaica Investment Symposium yesterday in South Florida and one panel included George Roper, Deputy Director of the Financial Services Commission (FSC) and Antoinette McKain, CEO of the Jamaica Deposit Insurance Company (JDIC).

The audience wasted no time during the Q&A segment to ask the questions many want answers to. The first question was roughly:

"I don't like the word 'schemes' to describe these, I call them 'opportunities'. Are these 'opportunities' operating illegally and if so, then shut them down, if not, leave them alone."

The answer was very clear - The FSC pointed out that it describes Credit Unions as "collective investment schemes", there is no negative connotation with the word "scheme" when they describe any financial company.

More importantly, he pointed out that those schemes that have not applied for licenses are operating illegally based on present Jamaican law and even would be in violation in the USA.

He explained that the USA has a law stating that investment clubs are defined based on a maximum participation of people where every person is involved in the decisions regarding investments.

The exact definition, according the to SEC section on their website - Investment Clubs and the SEC is below:

An investment club is a group of people who pool their money to make investments. Usually, investment clubs are organized as partnerships and, after the members study different investments, the group decides to buy or sell based on a majority vote of the members.

An investment club must register with the SEC as an investment company under the Investment Company Act of 1940 if all of the following three conditions apply:

1. the club invests in securities,

2. The club issues membership interests that are securities (see above), and

3. The club is not able to rely on an exclusion from the definition of investment company.

For example, a "private investment company" may not need to register with the SEC. To qualify, an investment club

* must not make, nor propose to make, a public offering of its securities, and

* must not have more than 100 members.

He also pointed out that Jamaica in fact has no such exemption related to the size of the club. Clearly an "investment club" like OLINT, with far more than 100 members and no voting on investment decisions, would be required to register with the SEC in the USA and there is no difference for operations in Jamaica.

He made sure to point out that the FSC did in fact issue a cease and desist letter and that the matter was appealed and they await the court ruling in early December. They only have the power to issue the letter and turn over the matter to the Director of Public Prosecutions (DPP). The FSC cannot simply "shut them down".

He also went on to explain why other "extremely high yield" schemes like Cash Plus had only three options to be in compliance with the law. Any company or entity that is selling a security has to be licensed and the people selling that security to the public also have to be licensed.

In the FSC new release on Cash Plus on May 4, 2007 - http://www.fscjamaica.org/publicinfo_files/bulletins/News release Cash Plus.pdf -
the FSC defined "securities":

"Securities" include stocks, bonds, promissory notes, certificates of participation in profit sharing agreements, investment contracts and documents commonly known as securities.

Cash Plus and others have 3 options:

Register and use licensed securities dealers (or have dealers licensed)
Sell their securities through a licensed 3rd party
Shut down

It is interesting that those who seek to say that the FSC is "badmind" or that the financial institutions are conspiring against these schemes are the least knowledgeable on the subject and have not sought to educate themselves about Jamaican law, or even understand how the US's SEC would treat these schemes.

Maybe the information above will have some material impact on the discussion.

Ed Bartlett speaks about Jamaican tourism and airlift strategy

2007-11-27T14:48:00.000-08:00

Another take on the Banks vs. Investment clubs

2007-11-27T14:34:00.000-08:00

Well it is no surprise that Bruce Golding indicated that there would be no bailout for risky investors.

I have put forth some arguments about the similarities between Albania's schemes in the 1990's and Jamaica today (differentiating of course between Cash Plus and the forex trading outfits) but I want to dig deeper into the war the banks are waging.

I understand that a senior person from JMMB said yesterday that what David Smith is doing is wrong and Michael Lee-Chin has made it known that any of his NCB employees found to be investing in these clubs will be fired (which I doubt is legal grounds for dismissal).

I think the "war" is weird because of the following:

The money withdrawn from the big institutions goes into accounts held by the investment clubs at these same institutions (otherwise they couldn't threaten to close the accounts)
The interest earned from the clubs is deposited back into the big financial institutions because none of the clubs offer checkbooks, debit or credit cards (Cash Plus is now launching a card)
The interest earned also goes toward paying mortgages, car loans and other debt held by the major financial institutions (Everybody likes on time payments for their loans)

So if I can see this (I used to work in one of these major financial institutions helping to develop and market products), the senior managers also are aware of these realities.

Therefore it must be something other than pure jealously that is motivating their 'war', something we the public do not know. Otherwise, one would merely be cutting off their nose to spite their face, right?

Forex trading is done all over the World and by the major financial institutions, so I am not worried about Olint, just concerned about guaranteed rates. I am far more concerned about Cash Plus.

So my final question is what is the real motivation for the banks current 'war'? Could the US and the money laundering reporting have something to do with it?

Carlos Hill of Cash Plus bas been in trouble with the Law before?

2007-11-25T13:22:00.000-08:00

I still have never gotten a satisfactory answer as to who this man is and what is his background. This article in the Gleaner troubles me further: 'I VIOLATED UNITED STATES LAW' - But the gov't returned my money, says Cash Plus boss.

What is the name of the company he became President of? We want to verify that claim.

What is the name of his company that got in trouble when they "loaned out too much money and weren't able to fulfill some of our obligations"?

What was he doing between 1986, when that happened, and 5 years ago, when he started Cash Plus?

He labels the current situation a "conspiracy" in the TVJ interview below:

In April of this year, Mark Wignall of the Jamaica Observer managed to get some answers from Cash Plus - Cash Plus gives its answers. Most interesting was this question/answer:

Question: If businesses are so profitable, why not get financing from banks/other lending institutions at lower interest rates of 8-20 per cent instead of paying out what amounts to 120 per cent, Wouldn't that be the prudent thing to do?

Answer: 'Jamaica does not have a viable secondary market, and as such it is extremely difficult for the company to grow its businesses because the banks are limited in the extent of loan amounts they can approve and, in most instances loans involving significant sums must be approved from the head office which sometimes may be situated overseas. It becomes a very lengthy, frustrating and arduous task for most businesses which, by the time a decision is reached by the bank, the business finds itself granted a smaller amount than the capital required/requested.

'Owing to the fact that the business has no other alternative, it is then forced to take that capital, even though it does not meet its requirement. This creates its own unique set of problems which can seriously injure the business seeking growth.
'One would be surprised at the number of businesses that seeks Cash Plus' intervention in assisting them with additional capital in order to meet their objectives.

If Cash Plus is indeed a business that is seeking out debt to make acquisitions of profitable companies and prefers to borrow from the masses instead of the banks - as is the case Mr. Hill has made - then eventually, Cash Plus would want to reduce the rates for borrowed funds since that is the common sense thing to do.

Cash plus says the deposits are loans - which makes them completely different from a savings account at a bank - but every business ALWAYS seeks to borrow the required amount of capital at the most favourable rate.

Some would argue that Cash Plus is issuing a perpetual bond - a bond with no maturity date. Perpetual bonds are not redeemable but pay a steady stream of interest forever. Some of the only notable perpetual bonds in existence are those that were issued by the British Treasury to pay off smaller issues used to finance the Napoleonic Wars (1814). (According to Investopedia).

Clearly though, a perpetual bond has a price based on a calculated value while Cash Plus just takes loans of varying amounts.

Others would argue that it works like a Pension plan - where the new people pay in money that is used to sustain the initial group of contributors (a legal pyramid). However, pension schemes, especially those like Social Security in the USA, rely on the fact that claims to original members eventually stop - they die, and this helps to offset the addition of new people.

In the case of Cash Plus, it is not clear what happens to the loan repayments when a person dies, but I would think that similarly to how liens can be sold to other people, the lien held against Cash Plus, as described in their own words, can be passed on to a relative or other entity.

From the Observer article again:

Question: If Cash Plus is unable to pay principal and interest, do investors/people holding promissory notes have a charge or lien over the businesses or assets?

Answer: 'The lenders of Cash Plus have a lien over the businesses and assets until that amount is repaid.'

A person can purchase real estate liens and it follows that these Cash Plus liens could be sold or even willed to a second party, meaning that new people are not automatically offset by the removal of old ones.

It is legally possible to run something similar to Cash Plus:

A private equity firm typically makes an acquisition in the following way -

Raise money, eg. US$5 million
Buy a company, eg. US$10 million
Purchase is leveraged (leveraged buyout, LBO) - $2 million cash, $2 million owner finance, $6 million bank loan at reasonable interest rate (less than 15%)
Make loan payments using profit from acquired company
Double size of company in 5 years (growth rate of only 15% per year)

The company could take the remaining US$3 million and use it to pay promised returns to investors over the next 5 years while paying down the debt for acquisition and growing the company. It could also seek out new debt (new loans) and use those loans to pay the promised interest to the first lenders, using the additional profit from the growth of the company and reducing interest payments to pay group 2.

This of course is not sustainable unless the returns for each new loan cycle has diminished returns - a lower interest rate than the previous loans.

I am watching this whole thing closely to see how it shakes out. As for OLINT, it is completely different from Cash Plus because it explains that it only trades in Foreign Exchange and that is risky. At least I understand what they are doing and it is done by all financial institutions.

Albania 90's high-interest schemes experience coming to Jamaica?

2007-11-24T07:31:00.000-08:00

Are Jamaicans about to learn the same lesson Albanians learnt in the late 1990's?

Read about what happened in Albania in the late 90's to better understand my perspective and why I say what I Say - Albania under the Shadow of the Pyramids - now you may understand why I have major reservations (eerily similar to some of these clubs).

The Jamaican financial institutions are waging war on unregulated investment schemes?

I heard through the grapevine that Cash Plus was being pressured because the JLP plans to allow OLINT back in since it was one of their biggest donors to their campaign for the recent elections. However, the Gleaner article today, read it here, would seem to indicate that all of these "unregistered schemes" are being targeted with account closures and non-acceptance of cheques.

I find it interesting that some people have said that even if an "investment club" like Cash Plus, which operates much more like a bank (or a private equity firm that pays every month), shuts down, they would not go back to local banks.

Why is there such resentment for local financial institutions by these individuals? My experience is that DB&G, JMMB and Mayberry customers are quite satisfied with their returns - but maybe these customers are more sophisticated investors than the ones in Cash Plus, I don't know.

A sophisticated investor is often defined as an investor who has sufficient knowledge and experience with investing that he/she is able to evaluate the merits of an investment and in the USA, such a status (Accredited Investor) is required to make certain investments.

When a friend asked me 2 years ago about my opinion of Olint, I expressed concern that there was no regulation, Forex is one of the riskiest kinds of investments (I know people that have lost tens of thousands of US trying to do it themselves) and even Warren Buffett, who is the greatest investor of the modern era NEVER guarantees an interest rate (He averaged 20% for over 20 years and the stock of Berkshire Hathaway, his holding company, is the most expensive on the US stock market - Series A shares cost over $100k).

As a student of Buffett's investing philosophy and his life, I can see how a company flush with cash can generate significant returns, but I still fail to see how they can pay out those returns every month, except in the case of real estate, a pyramid scheme or outright money laundering.

There is no free lunch in life, but so many people seem to believe that they can get something for nothing. High returns ALWAYS mean high risk - it is taught in every basic Finance class.

It seems that Jamaicans throughout the years have always been easy to convince to join anything that pretty much is a get rich quick scheme - why?

Am I surprised though? Not at all, afterall we have so many people involved in drugs from the 70's until now who prefer to make their money any way possible, as long as they can live the high life. Many have gone legitimate, but they started unscrupulously.

I don't know whether any of these 'investment clubs' are legit but if you have already gotten back your principal and now simply collect interest, you haven't lost at all, so good for you. I remain a skeptic and believe that the whole thing will come crashing down.

The case for selling Air Jamaica in 2008

2007-11-20T12:10:00.001-08:00

Here are the facts:

- Air Jamaica is clearly vital to the economy, accounting for 50% of the tourists coming to the island.

- The JLP wants to privatize it again - sell it off to someone who can then deal with it - which I agree with, rather than just shut it down like the IMF suggested in 2006.

- The name "Air Jamaica" is a source of national pride, but the airline has also be named the official carrier of Barbados and is really a CARIBBEAN airline, not just a Jamaican one.

- In 2005, Air Jamaica lost US$135 million, roughly $8 Billion JA, and has never been profitable

- Over the past decade, Air Jamaica has accumulated a deficit of over US$1 Billion (http://www.jamaica-gleaner.com/gleaner/20060915/business/business6.html)

Would you agree with the JLP selling Air Jamaica to a company even if they were going to rename the airline?

I say sell it to Virgin because they just bought the London route, setup a new code share into Miami and recently launched Virgin America. Very few companies could be a better partner (and Air Jamaica execs are in London right now talking to Virgin).

I say sell it, let them rename it if they want.

That money could be better spent:

- $5 Billion alone covers free tuition and healthcare (http://www.jamaica-gleaner.com/gleaner/20070704/cleisure/cleisure2.html)

- The JLP has already committed to free tuition and begun repaying parents so this money would replenish whichever budget they got that money from

How about spending the money on the following:-

- improved training and facilities for the police
- better schools (buildings/facilities especially)
- better pay for public sector workers
- improved roads

$8 Billion a year can go very very far, especially when added to decreases on the interest we pay on debt - a decrease of 1% on the interest the Govt. pays on debt saves $5 Billion per year!

On top of that, the damage that has been caused by hurricanes in the last 2 years runs into the billions as well - and we don't have the money for the repairs.

Govt. to privatize Air Jamaica within 12 months?

2007-11-19T08:15:00.000-08:00

The Jamaica Gleaner recently ran an article about the finalizing of the relationship between Virgin Atlantic and Air Jamaica, and that part of the deal will see an expanded Code-share agreement into Miami, with Virgin passengers en route to Jamaica through Miami changing over to an Air Jamaica place (read full article).

The real interesting part about the article was this piece in regards to on-going meetings between the two airlines:

"Virgin has said the two airlines remain in discussion on areas of cooperation to expand their partnership."

We all knew that the JLP had planned to rid the country of the 'Air Jamaica burden' during their term (it consumers as much as 10% of our national budget and has never been profitable) and my well-placed sources have said that we could see something as early as next year summer, but some things have to be worked out.

They also said that Virgin had expressed interested but originally wanted a 1-year review period. With this piece of news mentioned in the article, I am convinced that Virgin Atlantic is seeking a deal to privatize Air Jamaica and keep the name of the national carrier (there is precedent for such deals within the airline industry).

I personally would welcome this deal or any other privatization deal other than giving it back to 'Butch' Stewart, unless he repaid all the debt he gave it back with. Mr. Stewart is known to have been a big donor to the JLP this past election and it would be rather controversial if he in fact got Air Jamaica.

I understand that there are a number of interested parties and I hesitate to guess a few others but only a few people could afford to get into the airline business, much less benefit from it directly through tourism.

Michael Lee-Chin, with his new tourism investments in Portland, would benefit and certainly has the money. Is he interested? Could he strike a partnership deal with Virgin and share the ownership?

Cash Plus, the "not a financial institution but we pay out money every month" investment club is also awash with cash, but has little experience in the industry, and I personally don't expect it to be around for many more years.

A US Private Equity firm could certainly buy the airline and most certainly would turn it around. The size of the deal is tiny compared to many others that have happened and I know Jamaicans involved in private equity firms in the US, although I have never once heard anything like remote interest.

All I can say is that there is reasonable buzz involving the following words:

- Air Jamaica
- Privatization
- Virgin Atlantic

Lights Out! - Paulwell and Spencer resign

2007-11-14T06:35:00.000-08:00

Stop the presses - Paulwell and Spencer resign!

I know a ton of people that are saying "About damn time!" and who could wrong them! Paulwell has probably been the most scandal plagued Minister in the history of Jamaican politics, and while I have met him personally and liked what he said, some of his actions have been damaging to Jamaica.

He drives a hybrid, wants more Jamaicans to drive hybrids so we can cut our oil bill and put that money towards other things, I agree with his vision for Port Royal and I love that he liberalised the telecommunications sector - but...

As for Kern Spencer, the weeping one, he better be consulting his lawyers because I feel that this will fall heavily on his shoulders, whether or not he was taking orders from higher up. What I really want to know are the names of the companies and individuals who got rich off this scandal - point them out please.

Jamaican politics is as dirty as any other and the people who benefit the most are the politicians and their cronies - the people getting rich off the taxpayers who are struggling for the most part. How can someone who truly loves Jamaica and want to see it progress participate in such a blatant rip-off of public money?

Where did the money go?

2007-11-07T06:56:00.000-08:00

So the light bulb scandal is going to be the first big case against the PNP - Kern Wept - Former State Minister jolted by Cuban bulb saga.

So the person in charge of the distribution of free light bulbs from Cuba was crying while the new Government outlined how the Cubans had supplied volunteers and money for them to distribute the bulbs - which somehow ended up costing the Jamaican Govt. under the PNP some $270 million.

Does crying in parliament while a case is being made that fraud was committed amount to a guilty plea?

I really want to see how they explain this one because it stinks more than Trafigura, and we all know what happened with that money.

Story come to bump.

2007-11-03T06:55:00.000-07:00

This past summer Red Stripe was the primary sponsor of a magazine that contained some very racist remarks, never mind that the remarks are things said in private all the time - a company has no place in seeming to support such bigoted views.

This is what actually prompted me to start this blog and write my first web article at NowPublic - Racist Comments from Red Stripe in Jamaica?. I felt that our companies and government had to be held to a higher standard and I could use the web to show that I wasn't the only one with a certain opinion.

Since then, Red Stripe has issued an apology through the Jamaica Observer - Red Stripe Says Sorry, but an earlier blurb in the Jamaica Gleaner even went as far as saying that some people are still upset about the big brands' faux pas and they should get over it - simply disgusting.

3 days after posting the first story, I was contacted by a PR person from Diageo who then put me in touch with Mark McKenzie - at least someone was on top of things while Red Stripe was not taking any inquiries - Jamaican companies still have a lot to learn clearly. Red Stripe had felt that little harm was done because it was "only a few magazines to adults in Jamaica", to which I replied that it was all over the web and nothing is limited to a country anymore thanks to the web and social networks like MySpace and Facebook.

To this day there is still a group on Facebook that is called Amistad and Friends and contains a graphic that says "Boo - Red Stripe". Mark McKenzie sent me a letter that outlines the results of the investigation. You can read the letter from Mark McKenzie here.

Whoever said that blogging is a waste of time?

Virgin vs. the JLP Govt.?

2007-11-02T08:55:00.000-07:00

Sorry for being away for a little while - work has been getting real busy.

I couldn't help but agree with a recent Jamaica Gleaner Editorial that spoke about "shooting from the hip" by two of the new Ministers - Mike Henry and Karl Samuda - Petulance as Public Policy

Virgin had it's first flight land in Jamaica recently and Henry refused the invitation to attend! That comes across as so childish, worse for a person holding such a high position.

Virgin paid good money and has a legally binding contract, they are going to be integral to tourism - our lifeblood - and they have brought over 70,000 passengers to Jamaica through MoBay since starting service before the agreement with Air Jamaica.

Why would you want to diss a company that is so vital airlift and foreign currency earnings in Jamaica?

The role of Air Jamaica

2007-10-19T10:08:00.001-07:00

An interesting letter showed up in the Gleaner today condemning Air Jamaica for sponsoring a wedding promotion for Barbados: Air J forgetting its mission

However, the writer is clearly misguided as to the mission of Air Jamaica - to generate revenue and profits, eventually not needing the Govt. to prop it up.

The airline is the national airline of Jamaica but it is also a Caribbean airline. The past has proven that Air Jamaica cannot be viable by only providing airlift into and out of the island of Jamaica - so why would anyone complain when Air J tries to expand its routes and revenue?

The writer focuses on the subsidies from Jamaican taxpayers, which is fair, but to say that Sandals or some other hotel in Jamaica should benefit is the exact opposite of the argument made when Butch Stewart owned the airline - that he was using it to benefit his hotel chains and his pals! You can't have it both ways.

The more routes Air Jamaica can fly profitably, the more we should encourage them to fly them - and get them into private ownership ASAP. If taxpayers did not subsidize the airline at this time, it wouldn't exist so we have a choice:

No airline and no tax payer money vs. let it fly to other Caribbean islands and earn revenue so it needs less subsidies from taxpayers

Govt. Ministers and Corporate entities

2007-10-13T11:55:00.000-07:00

It would seem that the Jamaica Observer is taking a swipe at the Jamaica Gleaner in this article. The way the Observer frames the story, "a prominent Jamaican businessman" has made his private jet available to Government Minisiters from both parties throughout the years and that has only continued today.

The plane was used to get Audley Shaw to Antigua for the opening of a new Sandals resort, and he praised Sandals, even though Sandals is currently fighting a legal battle with the Government - and at no charge to the Government.

I doubt that anyone glosses over the fact that the Jamaica Observer is owned by that very same "prominent Jamaican businessman" - Gordon 'Butch' Stewart - and the paper could never say anything even remotely negative about him (editors have "moved on" because of such incidents) BUT....

I agree with the Observer that there is no conflict and it is a kind gesture because if Butch used to always lend out his jet and suddenly, because he is in a legal battle, he stops - he would be behaving like a child on the playground who says "Is my ball so you not playing with it again" and proceeds to leave.

Butch would also be snubbing the very same party that his party helped to win the elections - the Observer was very anti-PNP by any measure - and I hear he contributed nicely to the party as well.

The Gleaner is behaving like a PNP mouthpiece by making it seem like there is a conflict when it is merely the continuation of a tradition. I could understand if someone was saying the tradition was wrong in the first place, there is no doubt that Sandals has benefitted greatly from previous PNP relationships, but Sandals has seen a MASSIVE increase in competition because of the same PNP.

At the end of the day, the man can lend out his plane to help the country save some money and not have it seem like some bribe for his legal fight with the Government.

Shaw did not promise to double pay right away?

2007-10-07T11:50:00.000-07:00

So the Nurses Association was making all this racket about promises to double pay by Audley Shaw when he became Minister of Fiance and how they had him on tape. The Gleaner today has an article with "excerpts of the speech" and while it does say that he would seek to start by doubling pay, it never once gave a timeline!

Read the article

I doubt Shaw really forgot he made that comment to the NAJ so I don't know why he would go and say that BUT I certainly can admit that I thought the issue at hand was the timeline he promised - upon winning the election. Clearly the paper got it wrong in the first article.

There is nothing wrong with making the promise - it is doable and they have 5 years to accomplish it. Why then is the NAJ pressing for it right now if he never made a promise for right now? This is not the "free education promise" that talked about fees being eliminated the day after the JLP winning.

I feel it for Shaw and have to wonder why the NAJ is pushing at a time when we clearly have major financial issues. I base my opinions on what the papers report and the first article said he gave a timeline - so I criticized him for such a stupid timeline - now they write another article and have no timeline - so I take back the criticism.

Let us see what the new Government will achieve and I certainly realize that we need to be VERY wary of the initial reports that the media put out - clearly there is some sensationalism going on and I feel that the first article was not written or researched responsibly.

Gangs of Jamaica - Parts 3,4 and 5

2007-10-04T13:49:00.001-07:00

I decided to just let them all fly instead of breaking the continuity of the series because trust me, you WANT to watch the next on each time.

Here they all are.

Part 3

Part 4

Part 5

Gangs of Jamaica - Part 2

2007-10-04T09:21:00.000-07:00

Bwoy, it really hurts to watch this, honestly. I look forward to the JLP making more headway than the last administration, we can only hope.

Gangs and Jamaica - part 1

2007-10-03T22:45:00.000-07:00

I came across this set of videos and felt the need to share. This is part 1, more will follow over the next few days, I just want to take the time to let each one sink in before posting the next.

First scandal for JLP?

2007-10-02T08:53:00.000-07:00

Not really, but a sensational headline gets your attention.

So it turns out that the new Finance Minister, Audley Shaw, made an "election promise" to double the salary of nurses - election promise because it would happen if the nurses voted JLP and helped them win.

Like a true old-school politician, Mr. Shaw told the Jamaica Gleaner that he did not recall any such promise, even though the NAJ said they had 'the tape'.

Story come to bump - Caught! Tape reveals fiance minister's double-pay promise for nurses

Technology today is great! I wonder how many similar promises were made to others and what kind of promises the PNP was making if they stayed in power.

I hope politicians learn from the USA and the power of Youtube - anything you say WILL COME BACK TO HAUNT YOU!

Why don't politicians learn not to make empty promises?

Attacking the roots of problems

2007-09-24T16:07:00.000-07:00

Dr. Garth Rattray wrote an excellent article in the Jamaica Gleaner today titled Putting Money Where His Mouth Is and touched on a few topics, but mainly the fact that the Government's money is our money, the money of taxpayers - something so many Jamaicans seem to forget far too often.

I am glad to see others on the same page with my opinion in regards to education. Dr. Rattray wrote 'Free' or not, if those children don't go to school, they will gain nothing from the 'freeness'.

Prime Minister Golding has plans to spend our money in specific ways and we must be clear that his administration is attacking the roots of problems and not merely applying band-aids to wounds that need major surgery.

We have numerous studies and recommendations from the 1980's and especially the 1990's that seek to pinpoint the root causes of many of the problems we face today as well as offer potential solutions. I do hope that some of these are considered and the money is spent wisely.

If the new Government is not wise when it comes to addressing problems facing the country, it will only serve to fuel the common belief that 'anything free nuh good'.

I want to see the new Government succeed, not because I am some avid JLP supporter (which I am not) but because I want to see Jamaica, my country, succeed and accomplish what I know it can accomplish.

I want:-

lower crime and less murders
a police force I feel I can trust
better healthcare facilities (tools, medicines, etc.)
better educational system (schools, teacher pay, teaching tools, etc.)
reformed tax system
policies that motivate the private sector and private citizens to fund more entrepreneurs
more discipline in society
better family values
lower HIV/AIDS

I know this can happen in my lifetime, I am only 26, let's hope that the new administration is not going to be a 'tax and spend' one nor a 'freeness is the answer' one - that just nuh mek it.

Lastly, since my last post, Don Wehby has formally severed all his private sector ties and now the issue is really put to rest.

"We are going to be their worst nightmare"

2007-09-17T08:38:00.000-07:00

In her first public speech since the elections, Portia Simpson-Miller declared "I am going to let them have sleepless nights...We are going to be their worst nightmare".

Such a statement is not becoming of any leader and has no place in politics. The JLP did not seek to be the PNPs worst nightmare while being in Opposition for 18 years so why should the PNP seek to do this? It comes across as the words of a sore loser - and Portia, after already earning that label right after the preliminary results were announced, continues to strengthen that label.

The new Opposition party needs to work with the Government to make Jamaica a better place, not become an impediment to progress. I hope that she does not seriously plan to be a nightmare and hamper Jamaica's progress.

I agree with watching the new Government like a hawk but I also want to see the new Government go back and investigate the many improprieties of the PNP Administrations past, especially with word of missing computers and shredding of files at some ministries showing up in the local papers.

She does make a valid point in regards to the plans to cut lower-level Government jobs while adding to the Cabinet. Could these new positions be rewards for contributions brought to the party?

Conflict of Interest

I was waiting for the "conflict of interest" point to be raised about Don Wehby. While I believe that he would make a fine addition to the Ministry of Finance, Peter Bunting is quite right to point out the Wehby is still the CEO of GraceKennedy's financial services - he is only on leave for 2 years.

Bunting resigned his position before going back into politics and Wehby should do the same, otherwise it is unfair to other financial institutions and puts GraceKennedy at an unfair advantage that no one can deny.

Full Article in the Jamaica Gleaner

$1 trillion of debt for the Gov't - what do we do?

2007-09-13T17:23:00.000-07:00

I reader of this blog pointed out this story to me - Gov't debt hit $1 trillion in July.

The PNP certainly represented the borrow and spend political party and the JLP could very well be the tax and spend party - either way, the spending clearly needs to be curtailed.

The article states that "public debt, as reported by the finance ministry, has been growing at a rate of 13 percent each year, over the last five years" which is made worse by the fact that the economy has only grown in the low single digits under the PNP.

The JLP have indicated that they will rationalize Gov't spending and get rid of excesses it finds - but at the same time it has promised to make education free so it could end up being a mere exercise of moving money from part of the budget to another but not actually reducing spending.

The most immediate response must be to institute policies that can help the economy grow faster and cut back on spending. The short-cut of course is to raise taxes but I don't see that being a wise decision - instead they should focus on collecting more of the outstanding taxes.

In fact, lowering taxes might encourage more people in the "informal economy" and people trying to dodge taxes to actually pay, most likely increasing overall collected taxes.

The debt itself does not concern me as much as these two things:

- the rate of new debt accumulation

- the interest rates being paid on the debt

Debt by itself is not always bad but the rate of accumulation and the interest rates can cause it to grow so much faster and eventually become even ore burdensome.

A $15 Billion deficit will greet Golding

2007-09-09T20:54:00.000-07:00

Check the article in the Jamaica Observer - quite a shocker to many indeed.

The real question now is what will Bruce Golding do. He has very limited options, all of which affect his credibility:

Print more money
Raise taxes
Borrow money
Break his promise
Trim expenses

Whether or not he wanted to offer free education to the population, he would be facing a problem, the free education promise just makes it that much worse and that much more immediate.

I have seen where even JLP supporters thought it foolish to promise free education right away. A 3-year phase-in or even next year would have been more reasonable - it seems that it was just an election promise typical of a politician interested in getting votes and finally winning.

If he just prints more money, that leads to inflation - which has been under control under the PNP. For those who don't understand economics, it is simple: Too much money chasing too little goods means an increase in demand, which leads to an increase in price - basic supply and demand.
If he raises taxes, he could very well see a riot worse than the gas riots. Jamaicans are already over-taxed. What could he tax without incurring their wrath? Bauxite? Tourism?
Borrowing money to plug a financial hole in a national budget is nothing new, even America does it quite often (their debt is over US$9 Trillion as we speak) but organizations like the World Bank and IMF (whom I hate) don't lend for things like education. He could however issue Government bonds and the international market will lap it up - Jamaica has a great repayment record on debt. Don't forget though - when you mortgage your house, the bank owns it.
Breaking his promise would ease the pressure to find the $2.2 Billion needed to provide free education but doesn't solve the deficit problem.
Trimming expenses where what the MOUs were for. He could get rid of all those over-paid consultants, halt costly projects and redirect funds. He could also hold all payments on Government contracts until the Contractor General rules on which ones were legally obtained versus which ones circumvented the law, in which case they should be cancelled. I bet that would save a pretty penny.

I hope he does the last one and I fully expect the Government to issue more bonds to cover the deficit like any other Government. There is no crisis, lots of Governments face deficits - I just hope we try not to spend more than we make in the future. Fiscal discipline is vital to the health of a country.

How come we just hearing about this deficit? Do you think it would have come out had the PNP won?

The goal is more important than the role

2007-09-05T21:21:00.001-07:00

I would love to pass on a great article I read today by John C. Maxwell, author of books such as The 21 Irrefutable Laws of Leadership.

The key statement was profound and yet so rare in application:

Recognize that the goal is more important than the role

He was focusing on the fact that sometimes a person has to be willing to take a different role to achieve a common goal for all parties involved.

Portia and the PNP would do well to heed this advice and realize that the common goal is a better Jamaica and their role is now 'Opposition Party'. While contesting seats in court, it would still be best to now accept that role and begin to move forward with that common goal in sight.

Bruce Golding has already spoken about this common goal, now Portia needs to shake the hand that has been extended and begin the process of working together for a better Jamaica.

Finally a sensible speech

2007-09-05T06:26:00.000-07:00

Portia rightly was criticized for her remarks immediately after the election, clearly not on par with what is expected from someone holding the title of 'Prime Minister'.

One must always be careful when speaking to a nation, especially in regards to election results. She knew that her words could cause trouble and yet still spoke in a way that came across as a sore loser.

She has now conceded and the speech was much better. I have no problem with the PNP qualifying the statement and reserving their right to challenge the counts as well as the legality of sitting MPs with dual-citizenship, it is their right under the law and I respect the rule of law, even though I don't agree with it.

I hope she has learnt from her mistake and will not hasten a speech next time without properly thinking through the potential consequences. I am quite sure she lost some supporters because of that initial speech - it should have been handled better for sure.

Going forward, it will be interesting to see what happens if the PNP really do go to court because it will expose some interesting things about our politicians, and maybe pieces of their past.

I am still waiting on the final count but the one thing the PNP must note - a large portion of the Jamaican voting population clearly do not want them to lead this country and that is an indictment of their previous terms.

If they in fact manage to get enough seats somehow to form the Government again, they had better take note of this because clearly many people are not pleased.

Also, the JLP must also take note of the fact that they did NOT win by the landslide they predicted, which also means they are swimming upstream too and need to win people over to their policies OR change their policies to fit with what the people want.

Either way, Jamaica is in for an exciting 5 years - I just hope it won't be all a stalemate like Democrats vs. Republicans - we actually want our Parliament to get things done.

Closest election ever

2007-09-04T06:46:00.000-07:00

So my analysis in the last post did not have an option that explained such a close election. 31 - 29 seats in favour of the JLP (for now according to the PNP) is going to make for a very interesting government if it stays that way.

This is the narrowest of majorities in the history of Jamaican politics and it means that compromise will be the order of the day over the next 5 years. Voting along party lines to amend or pass laws would simply not get anything done - 2/3 majority is often the requirement.

So what does this result mean?

I think Bruce Golding hit the nail on the head when he said that "It may very well be that the people of Jamaica, in their own profound wisdom, are sending a clear message to all of us that the time has come for constructive engagement among the political forces of the country." - Jamaica Gleaner

The pretty equal split of the popular vote and the distribution of seats in Parliament send two clear messages:

A large number of Jamaicans are unsatisfied with the PNP
A large number of Jamaicans do not like the JLP's plans for the country

Keeping this in mind, both parties will have to make compromises to be able to get a clear mandate next time.

I can honestly say that I prefer a narrow margin like this, similar to the U.S. Congress with Democrats holding 1 seat over the Republicans. For too long we have had ineffective Opposition to keep a governing party in check and now that the JLP has a slim lead, and could well lose a few seats if the PNP can in fact prove the case for dual-citizenship, Jamaica is better off.

With such a narrow victory, Parliament is going to be a place of compromise, and that is what governing is about. It should never be "my way or the highway" and it will force real debate and engagement of the Opposition in order to secure enough votes to be a productive Government.

This will also prevent any party from adding debt to Jamaica's books without consent from the other party.

I look forward to the final result and expect that however the numbers turnout, the slim majority will remain, in any party's favour.

The last question is how the PNP will be affected if they in fact go ahead with the dual-citizenship probe. There is a distinct possibility that they could pick up 4-5 seats, they only need 2 seats to form the Government and the Jamaican Constitution is very clear.

Some people will feel that the PNP is using that to stay in power - but as much as I hate the law, it is the law and should be enforced. The PNP however, in enforcing this law, had better enforce ALL the laws of the land, including capital punishment (granted, the Privy Council has been the one blocking capital punishment, not the PNP).

The Democrats and Republicans in the USA have gone to court many times and demanded recounts. If Al Gore had gone to court over his loss, there would be no Iraq War or so many other scandals - so in that case it would have been welcome to see a legal challenge.

In that light, you cannot fault the PNP. The JLP however must be confident about winning in court because fielding candidates with dual-citizenship would not have been smart, knowing full well the possible consequences, or maybe they expected to win by such a large margin that losing 4 or 5 seats would still leave them in power. If they lose their first election in 18 years because of this, it would certainly be a major blow to the leadership and the decision-making that lead to these candidates being nominated.

This is just starting so let's watch it play out. I just want to say thank you to my fellow Jamaicans for helping to make it one of the less violent elections.

What does it mean if 'X' party wins?

2007-09-03T07:27:00.000-07:00

I spent the weekend thinking about the elections today and what it would mean if the PNP or JLP won - as in what signal the voters were sending to the politicians and the rest of Jamaicans. Here is my simplified opinion.

If the JLP wins...

The JLP has campaigned as the party of "change" and so if they win, it should mean that the voting public really wants change in the approach to governance and the direction the country is going.

The JLP also promised a lot of "freeness" so people could be sending a clear signal that they believe education should be free - a throwback to Michael Manley and the PNP in the 1970's.

Bruce Golding thoroughly beat Portia Simpson-Miller in the debates - but even George Bush lost the debates and still won the election, and I doubt the debates actually affect the majority of voters.

I believe that the above three would not be the most important reasons for the JLP win, neither the campaign or their ads. If the JLP win, I feel it would be because Jamaicans are tired of the scandals and mismanagement, feel that Portia is cut from the same cloth and will not change that aspect of the Government and do not want an unprecedented 5th Term.

Basically, Jamaicans would be saying that they are tired of the PNP.

If the PNP wins...

The PNP has campaigned by saying that they won't "change course" and pointed out the successes - such as highway 2000 (delayed?), new investment in tourism (tons of hotel rooms and jobs), the half-way tree traffic center (to be completed soon), inflation control, stable dollar, renegotiating the interest rate on debt payments and paying off the IMF.

Of course, there is no mention of the failures:

scandal after scandal
lack of jobs
massive increase in crime, especially murders
low pass rates in education system
finsac rescue of the financial sector

A win for the PNP could be because there are many people who do not trust Bruce Golding because he left the party to form his own and then went back to the JLP (he says he went back on his terms and because they accepted his reforms). The JLP has been a pretty ineffective opposition for quite some time.

I however believe that a win for the PNP would be because people actually believe that Portia will govern differently from her predecessors, address the negatives listed above and continue the positives. Her first year would prove that to be true or false.

Conclusion

This election is among the closest ever in Jamaica, and rightly so - the country definitely needs change in some areas, but also needs to continue the progress in others. The manifesto of the JLP had some great ideas, and some bad ones, while the PNP seems to be lacking as many great ones. It is my hope that whichever party wins, asks Jamaicans for their opinions and works with everyone for the betterment of the country.

Just because it is not your idea does not make it a bad idea - I hope the politicians see it that way.

I also hope that they never forget that they are elected by the people, for the people and of the people - so involve the people.

The true costs of Free healthcare

2007-08-30T07:04:00.000-07:00

I read an excellent article in the Gleaner today by CaPRI and I found it very informative and quite clear in explaining what the true costs of the various healthcare plans proposed by both parties would really be.

Read Full Article

Essentially it boils down to the fact that we face a shortage of medical staff and salaries already account for 70% of the health budget. The majority of the costs that we would face with the reform will not come from the elimination of fees - those only account for 0.39% of the budget - it will come from salaries of the people to staff clinics, hospitals and any new medical centres that are constructed.

The article also mentions that KPH has 4 operating theatres and only runs 1 because it doesn't have enough specialists to use the others!

Before we start adding new things to our healthcare system, it is important to figure out the following:

what can we adapt?
what can we fix right now?
what needs to be removed?

The smartest thing these politicians can do in my opinion is to first make sure that places like KPH are functioning at a reasonable level - then we start adding to the system to make it better.

It is foolish to build on top of a broken system - solidify the foundation first and then your house will last far longer. I look forward to hearing how they will reform the current system to increase efficiency, deal with the staff shortage and get hospitals operating properly.

'Value' and 'Values'

2007-08-19T13:03:00.000-07:00

My father is fascinated with ethics, currently conducting research on the subject, and I recall my 'Business Ethics' class with a smile.

One of the most famous business thinkers of the 20th Century is Peter Drucker, a brilliant man certainly by any measure. His influence on management has been profound to say the least. I mention him because he once said the following:

"A developing country can easily import technology," Drucker noted. "It can easily import capital. But technology and capital are simply tools. They only become effective if properly used…by competent and effective management."

I believe that every single one of our politicians and businesspeople need to take this to heart. In our effort to build a better Jamaica, we must not lose sight of our values.

Jamaica cannot achieve glory with just new technology and capital - we also need "competent and effective management" - in most cases, by our Government.

Jamaica's political history is littered with just the opposite and that needs to come to an end with this next election. We are 45 years old now - no more mismanagement and incompetence. We have made our mistakes already - it is time to learn from them and learn from those of other countries.

Whichever party wins needs to prove quickly that it is in fact competent and effective. Imagine if the winning party sets up a bipartisan tribunal to investigate the mismanagement of the past 18 years and hold those responsible to account?

It would show that the interest of the people is truly at the centre, and not party self-interest (be it interest to protect those within a party or to destroy those in another party).

If the PNP wins, it should create a task force with a JLP member as the Chairman to investigate the scandals that plagued previous PNP administrations - after all does Sista P not say that she is cut from a different cloth?

If the JLP wins, they should create the same tribunal - but with PNP members in strong positions so it does not come across as trying to make the new Opposition party look bad.

Democracy is about the people and I am sure a lot of people would welcome this kind of tribunal and investigation.

Lastly, it better not interfere with the other, more important tasks at hand. The priorities are clear:

Crime and violence
Education reform
Job creation
Health reform

Fix those first, and you start to transform Jamaica for the better. You would also be surprised how many people would return or invest more down there.

We have other options

2007-08-17T12:54:00.000-07:00

I came across a good article in the Gleaner today about some options for 'funding the promises' as expressed by both parties. Read it here.

It however neglected a real option with very little negative side effects: refinancing current debt and applying the savings to social services, re-training, subsidies and tax breaks for companies investing in certain areas.

Imagine that you have a loan of $1 billion at 13% and can borrow that amount of money from another bank at 9%, if you were smart, you would borrow and use it to pay off the higher interest debt - refinancing or doing a balance transfer.

In the case of a country, the numbers are much larger, and so are the savings.

Jamaica could borrow money from a cash-rich country like china at lower rates and pay off the higher interest loans.

'But will we get the money?'

Well we have a great repayment history, decent credit rating, never defaulted, paid off the IMF and show a willingness to repay. We have also borrowed from them in the past - case in point, the new stadium.

The billions saved could do the following:

1) Used for re-training to make Jamaica more competitive on the world stage

2) Subsidies for important areas like agriculture - the USA and Europe does it, so why not us? I also believe in 'food security' as well.

3) Social services like healthcare, modernisation of the police force, better pay for teachers, school refurbishing, no exam fees, and re-establishment of rail service (which could be partially privatized).

4) Tax breaks for companies investing in areas like solar power, ethanol production, organic goods for export, soundstages for film production and pharmaceutical research on tropical plants.

I spoke with JAMPRO representatives (now Jamaica Trade and Invest) many times and they are very clear that we would have many more films shooting here if we had infrastructure. We can learn from Montreal and Vancouver.

Green technologies are going to be in high demand - where better to work on solar power technology than the Caribbean?

A treatment for glaucoma using extracts from marijuana were developed in Jamaica, imagine what else is possible if more pharma companies invested in R&D focusing on indigenous Jamaican plants.

The market for organic goods is growing. Last year I attended a JEA (Jamaica Exporters Association) event focused on promoting this as a great way forward for farmers. Look at the growth of Whole Foods in the USA.

In short, we don't need to choose between borrowing, tax increases or printing money.

New Youtube channel focusing on a better Jamaica

2007-08-16T11:36:00.001-07:00

A new channel has been launched on Youtube called Progressive Jamaica.

The videos will be a mix of interviews with people all over the island as well as questions and suggestions from people who feel that they have something to say to the government, opposition or general public.

Here is the first video:

Be conservative about change

2007-08-13T16:11:00.000-07:00

I recently read an interesting article in the Harvard Business Review about change. The article was titled Managing for the long-term: The Four Principles of Enduring Success. Granted, this was focused on businesses and being great, not just good, but it can just as easily apply to governments and countries.

This is my version, reworded for that purpose, focusing on Principle 4 - Be Conservative about change.

Conventional wisdom tells us that creative destruction is the only way to survive in modern capitalism: Change is inevitable, and it's better to lead than follow it. At least that's the conventional wisdom. Great companies and countries beg to differ. They go through radical change only at very selective moments in their history. Jumping onto every new wave is not for them. They use their core values and principles as guidelines and approach change in a culturally sensitive manner that requires patience to work through.

I hope both parties heed this.

I will discuss Principle 1 in the next post - Exploit before you Explore (emphasize exploiting existing assets and capabilities over exploring new ones).

Response to Shaw/Davies debate

2007-08-11T18:01:00.001-07:00

The Jamaica Gleaner was quite happy to say that Audley Shaw "commanded" the debate - read here

But it does not take a genius to ask two questions:

Why are we going to borrow funds at a time when our debt burden is so heavy?
Why the hell would we ever go back to institutions like the IMF, IADB or World Bank?

I am certainly not interested in loans with lower interest rates but tons of strings attached. It is these same organizations that lent us money in the 70's under Manley and forced him to charge exorbitant interest rates to the farmers when they borrowed from the Govt.

These same institutions also gave us money to build schools but wouldn't let us build roads to access them.

One of the best examples of money with strings attached is the University of the West Indies Hospital which has more than one generator in place to provide electricity and they have wanted to replace the current system with one streamlined system. They originally received donations from various countries (US and France included) to build the various original systems and were required to spend the money with companies from those countries.

The problem now is that none of them are interchangeable - a more expensive proposition. There is a reason Southwest airlines flies the exact same type of plane - interchangeability lowers maintenance costs. It also makes replacement easier.

Jamaica does not need more debt. I agree with Shaw that we can use our funds better, reduce waste and stimulate more investment (foreign or local). I however disagree with a platform that seems to say that we should:

borrow our way to growth
sell out to the highest foreign bidders
add more debt to Jamaica's current debt

That cannot be a smart policy. When a person is in debt, they tighten the belt, try to increase income, negotiate the interest rate and pay it off - then avoid running up the credit card again, preferably cut it up.

Jamaica paid off its credit card to these organizations - don't run it up again.

"Not fit to be raped" - What did the Mayor of Kingston say?

2007-08-11T10:01:00.000-07:00

I could only read in utter disgust about such a display of crass behaviour, especially for someone who holds the office of "Mayor of Kingston".

Clearly I was not the only one who felt disgusted when Desmond McKenzie referred to Roger Clarke as "not fit to be raped" during a debate:

Letter to the Gleaner

Of course it is suspect that the Jamaica Gleaner article about the incident made no mention whatsoever of McKenzie's remarks, instead focusing on the statement by Clarke that sparked the retaliation - the the "JLP would rape the country". Jamaica Gleaner Article

I thought that reporting in a democracy was supposed to be fair and provide a balanced viewpoint. Shouldn't this cause me to question the journalistic integrity of the paper?

Also, who is "fit to be raped"? Show me one such person.

UN Millenium Development Goals

2007-08-11T09:55:00.000-07:00

Many people are not aware of these 8 goals set forth by the United Nations in 2000 with a target date of 2015, known as the Millenium Development Goals.

Eradicate extreme poverty and hunger
Achieve universal primary education
Promote gender equality and empower women
Reduce child mortality
Improve maternal health
Combat HIV/AIDS, malaria and other diseases
Ensure environmental sustainability
Develop a global partnership for development

You can get more in-depth information on each of these goals by clicking here.

Interesting interview

2007-08-11T07:59:00.000-07:00

I came across this interview and is representative of the new 'citizen-journalism that the digital age allows. The interview is with a young man from Standpipe in Kingston, Jamaica.

'Basher' talks about politics, his stuggles, education and his dreams.

Welcome

2007-08-11T07:22:00.000-07:00

Thank you for visiting this blog, this is the official launch of what I hope to be an influential blog regarding issues facing Jamaicans in Jamaica today.

I am concerned about the future of my country and as someone born in the early 1980's, I feel that the mainstream media does not represent the views of young people adequately - hence this blog.

In the digital age, I do not need to depend on letters to the editor of a newspaper, hoping that it will get published (depending on their agenda and their advertisers). Some of the letters in fact have been planted - but I believe in freedom of speech.

I can launch my own column and influence those who read what I write.

I want to foster discussion so please comment and do not think that I do not want see opposing views - discussion is what makes democracy great and if we do not foster that, we lose the greatest value of democracy - the ability to ask questions.

What does A.O.C. stand for? - Agent Of Change

Some may think it brazen of me to use that but I do intend to be a true agent of change because Jamaica needs to move forward, reclaim some of its past greatness and climb to new heights - because we can.

Only one thing guides my posting, our National Pledge:

Before God and all mankind, I pledge the love and loyalty of my heart,

the wisdom and courage of my mind,

the strength and vigour of my body in the service of my fellow citizens;

I promise to stand up for Justice, Brotherhood and Peace,

to work diligently and creatively,

to think generously and honestly,

so that Jamaica may, under God,

increase in beauty, fellowship and prosperity,

and play her part in advancing the welfare of the whole human race.