Pere Rusiñol
Myron Scholes and Robert C.
Merton won the 1997 Nobel Prize in Economics for developing a new
method for determining the value of financial derivatives: the
scientific basis to ensure the success of millionaire hedge funds (hedge
funds, high risk). Discovered the philosopher's stone, they are being put to work through the Long Term Capital Management.
The results were certainly impressive, but not in the expected
direction: in 1998, the fund lost 4,600 million dollars and had to be
rescued by the government. In 2000, was closed.
The opinions, in economics, are often disguised as truth, especially if
they have a powerful speaker behind the media, academic or business,
but the reality is more complex.
So much so that we have entered 2012 and the public pension system is
nowhere near break in Spain, although since the mid 1990's very solvent
studies - often sponsored by financial institutions - predicted safe and imminent bankruptcy, and the new millennium.
Many of the economic approaches have become hegemonic "not hold or on
its own terms," said Miren Etxezarreta, professor emeritus at the
Universitat Autònoma de Barcelona. In his opinion, it is actually "myths" that can be "valid within their own particular paradigm."
2011 has been a devastating year for some of the "myths" more
widespread than economic, however, in 2012 continue to enjoy good health.'s Office has chosen 11:
1
that the stock market rise is always good
The tendency to equate the behavior of the stock with the real economy
usually leads to a simple equation: if the stock goes up, it's good for
everyone.
But not necessarily so and, in 2011, has again become clear: some of
the programs to reduce business costs more aggressive this year, focused
primarily on layoffs, were applauded by immediate increases in the
park.
One of the hardest was the one presented in August by the financial
giant HSBC, the same day reported a 3% improvement in half-yearly
profits, announced 25,000 layoffs, 10% of the global workforce. That day the shares rose 3.4%.
There are many other examples, such as Cisco, after falling 24% in the
stock market since the beginning of 2011, the mere leaking of a plan of
10,000 layoffs hit him rebound to 3%. In Spain, the experts agree: unemployment may even worsen in 2012, but the stock will rise between 6% and 10%.
There is even evidence that the correlation between stock market and
unemployment could be reversed, says Alejandro Inurrieta, Institute of
Stock Market Studies, who, however, considers that, in reality, with the
speculative boom of engineering over the counter, "the Thermometer
Exchange is no longer anything. " In 2011, the only country where the stock actually rose was, paradoxically, Venezuela: 79%. Orthodoxy emphasizes a fact never the case.
2
If the termination becomes cheaper, firms hire
Spain is the country with higher unemployment across the EU and the
employers and all places of Orthodox studies always show the same cause:
the alleged high cost of dismissal. This despite the fact that Spain is also the country where they are fired.
The first I took the socialist government, with risk of hara-kiri,
approved in 2010 a labor reform to lower the firing cost him a general
strike.
With the new framework, compensation for unfair dismissal fell from 45 days to 33. But above all, expanding the "objective reasons" to fire with only 20 days of compensation and also introduces the possibility of compensation by public money of 40%.
"The great singularity of Spain is that the dismissal is already in
free practice and compensation for the employer that could easily be, in
practice, only 12 days," recalls Albert Recio, an economist at the
University of Barcelona.
The Socialist Government in 2011 expected to gather the fruits of reform, but the hypothesis had no empirical basis. On the contrary, since the adoption, have lost another 404,000 jobs.
But 2012 began as usual, with an enormous pressure, fueled by the PP as
an ultimatum, in favor of a labor reform "urgent" that lowers the
dismissal.
3
cuts calm markets
When, in May 2010, the heads of the European Union (EU) shifted to
drastic cuts and coordinated explained by the need to calm the markets. In contrast, the spiral began opposite: the vast majority of countries that have excelled in cuts
has worsened their rating, risk premiums have skyrocketed and the
markets seem more restless than ever, despite the succession of settings
designed theoretically calm them.
In Spain, Zapatero and Rajoy made a pact in the summer to raise
constitutional extreme discipline, and in November, on the campaign
trail, the risk premium climbed to the threshold that experts consider
next the rescue.
Keynesian economists and critics are unanimous: the drastic cuts hit simultaneous growth and, therefore, multiply the distrust.
"Markets are casting clear messages, but the politicians draw the wrong
conclusions," said the prestigious Pulitzer Prize investor and Liaquat
Ahamed, who believes that the calm will not return without a growth
horizon.
Even the International Monetary Fund (IMF), the traditional guardian of orthodoxy, it is clear. Its chief economist, Olivier Blanchard, just take stock of the lessons of 2011.
Among them: "Financial investors are schizophrenic on fiscal consolidation and growth. React positively to news of fiscal consolidation, but then react negatively when the adjustment leads to slower growth, which happens often. " His conclusion: Settings should be "like a marathon, not a sprint."
4
For a country, nothing is worse than no pay
All economists agree that, for a country, the option of not paying debts is very bad.
But unanimity has begun to crack: Some economists critical of the
school, but moving now among the post-Keynesians believe that the
default-is bad, yes, but not necessarily the worst.
"There is something worse than not paying: what we see in Greece,"
says Eric Touissaint economist CADTM Belgian center that specializes in
debt, adding: "The setting has a terrible social impact, but also
implemented to avoid harm banks, even knowing that the debt is so high
that you can not pay. "
2011 has been an important year for the erosion of the myth, even for
conventional economic school that has accepted a Greek debt relief, and
hence a partial default in the eurozone, up to 50%. But two experiences have won many integers as counter-examples, despite their singularities: Argentina and Iceland.
Now, ten years from the spectacular bankruptcy of Argentina.
The crash was loud, and hundreds of thousands of people lost their life
savings at a stroke, 'but very soon the economy improved, and since
2002, all exercises, except two, have recorded growth above 8%, "growth
faster economic in the Western Hemisphere over the past nine years and one of the highest growth rates in the world ", according to a recent report by CEPR post-Keynesian, based in Washington.
Closer, in Iceland, something similar happened on a smaller scale: the
Icelanders have already rejected in a referendum twice, the last, last
April 5000, paying millions of dollars that the United Kingdom and
Denmark advanced to its citizens trapped in the collapse of an Icelandic
bank. Technically, this is a debt of Iceland that its citizens refuse to pay.
Despite that, Iceland grew by 2.5% in 2011, the Eurozone only 1.6% -
and the unemployment rate has fallen 1.5 points since the referendum in
April that the country is supposedly condemned for refusing to to pay.
5
It is impossible that the euro has reversed
It seemed a myth but a reality even for his critics: the supposed
strength of the euro did not imagine that any country would stop. And much unless there is a risk of collapse.
But suddenly, just as it marks the 10th anniversary of his birth, the
hypothesis of shipwreck of the single currency has begun to be
considered as a possibility, even among those who believe will never
happen.
In September, two major investment banks (UBS Swiss and Japanese
Nomura) surprised with studies on the effects it would have for Greece
leave the euro.
He was the starting signal for the demolition of the myth, at least in
theory: some central banks have begun to calculate the effects that
would restore the old coins and so did several multinationals.
Also academic centers: one of the papers has been the most sought after
French economist Eric Dor Leaving the eurozone: a user's guide.
Jean-Claude Trichet, for eight years at the European Central Bank had always considered "absurd" the mere hypothesis.
But in November he replaced Mario Draghi, who on December 19 cover of
the Financial Times was warning himself from the effects of a breakdown
of the euro. "The ECB president breaks a taboo," said the bible of the City. And that still echoed the echoes of the EU summit that supposedly saved the euro.
6
propels economic inequality
For decades it was a mantra of the orthodox economists, the economy as a
whole benefits from the rich to gain more and more, but increasing
inequality.
But after the crash, data have emerged, several economists (David A.
Moss, Robert Reich) have pointed out that the two moments of greater
inequality are registered in the U.S. 1928 and 2007, just before major economic wallop of contemporary history . The parallelism is highest: in 1928 the richest 1% totaled 23.9% of U.S. wealth, in 2007, 23.5%.
Reich wrote that when the differences are so acute, there are two
simultaneous phenomena that end up leading to the crisis: the purchasing
power of the middle class "is only kept on credit, creating a debt
bubble" and the most rich do not have any ability to invest in the
productive economy, but seek higher returns to speculative formulas, also fat bubbles.
In 2011, two major studies have been reported to show how inequality soared in the West. Then divided. Why inequality is increasing?, The OECD found that the gap between rich and poor is at the highest level in 30 years.
The U.S. Congress, meanwhile, released a macro studies reveals that the
richest 1% have seen their disposable income after tax 275% in three
decades, the percentage of middle class is limited to 40% and, between
the poorest 5% in only 18%.
Concern over rising inequality has expanded the scope liberal: Martin
Wolf, economist reference the Financial Times, he dedicated one of his
last thoughts of 2011: not only is "unfair" but also "inefficient," he
said .
7
It is not possible to raise taxes on the rich
After World War II, the top rate of income tax in the UK came to be 95% and in 1979, still stood at 83%.
But Margaret Thatcher won the West and began a period of systematic
lowering of all progressive taxes with an argument: if the rate is high,
the wealthiest find ways not to pay. Then left the majority even theorized in Spain: "Lowering taxes is left."
The myth has lasted three decades, but in 2011 it became clear that
something can be done, although the vehicles used by the very wealthy
are being left out.
The vast majority of EU countries, almost all with right-wing
governments has once again raised the upper reaches of income tax and
taxes were recovered on large fortunes (or equity).
The trend has also come to Spain's Socialist government tax Heritage regained just before leaving office. And the new government of the PP will rise to seven hit points of the employees income tax exceeding € 300,000 gross per year and up to six points on capital income.
The paradox is that the turn of 2011 he implored particularly rich
themselves: In the U.S., Warren Buffett demanded that the taxes will go
up, shocked that their employees pay rates higher than yours. And in Europe, the billionaire owner of Publicis led a similar show in France demanding millionaires pay more.
8
Gurus always right
2011 has been a tough year for some gurus whose opinion often elevated to the category of truth.
The most emblematic case is that of John Paulson, the investor that the
crisis had placed the aura of genius after winning in 2007 to 24,000
million dollars by the explosion of subprime mortgages.
In 2011, however, two star funds lost up to 30%.
And Man Group, the world's second hedge fund, suffered a net outflow of
up to 6,500 million of client funds to his poor results.
It has also been played the reputation of Nouriel Roubini, an economist
turned star for having foreseen the crisis just before the outbreak.
Roubini now symbolizes the conflict of interests of the gurus who
supposedly know what to do while direct private consultancies.
The school has insisted Roubini day in and day out at the outbreak of
Greece, while analysts at his consultancy, RGE Market Strategy,
recommended operations against the country.
"So the teacher and advisor form a community of property, his hand
pressed to academic worst happens and your hand collects financial
benefit when the worst is happening," Roubini wrote journalist Xavier
Vidal-Folch.
9
He who makes the payment
Since the crisis began, has been a constant watch was paid severance
exorbitant bonuses to some of the most responsible for the crisis, while
Bernard Madoff became the sole scapegoat behind bars.
But 2011 has been more emphatic if possible, with powerful symbols.
In the U.S., Paul Volcker, an economic adviser to Barack Obama more in
favor of putting into shape the financial sector, went home, as the Democrat who fought the battle in Congress, Barney Frank.
Instead, the President placed in front of his economic council, Gene
Sperling, exasesor of Goldman Sachs, the bank investigated for its role
in the crisis, and appointed chief of staff William Daley, from JP
Morgan Chase, the bank CDS invented, perhaps the instrument most
responsible for spreading the crash.
In Europe, the crisis originated largely in the financial gadgets
created by Goldman Sachs to help hide the Greek debt, and just in this
world, emerged in 2011, alleged saviors: Mario Draghi, former vice president of Goldman Sachs International
has taken the European Central Bank president, Mario Monti, exasesor
the bank, is prime minister of Italy without elections, and Lukas
Papademos, the Greek central bank governor when Greece cooked their
accounts, also directs the Executive Hellene now without elections.
With the 20-N, Spain has joined the trend: the new economy minister,
Luis de Guindos, and his man at Treasury, Inigo Fernandez de Mesa, come
from Lehman Brothers, the bank whose collapse became the best symbol of
the global crisis and that, in Spain, coordinated the IPO of the voting
shares of the Savings Bank of the Mediterranean.
10
The future of private pensions is
The worst year for employment in Spain has created a Social Security deficit of 600 million, equivalent to just 0.4% of GDP. And despite this, the bank of the pension will remain above 62,500 million. In contrast, private pension assets in Spain has lost,
failing to account for the last quarter, to EUR 3,100 million (3.8% of
its value), so that the volume of private funds falls to 2006 level.
If public pensions are threatened by the crisis, even private ones,
according to official figures, in both the UK and the U.S., the hole in
private pensions, that is, lacking the resources to meet their
commitments, has end of 2011 outperformed their respective records.
In the UK, as reported by the Bank of England, the overall deficit of private plans in November amounted to 266,000 million euros and 5390 affected the existing 6533. In the U.S., Mercer estimates that the deficit of the plans of the companies in the S & P 1500 total 400,000 million.
OECD reports have shown that, given the increasing financial
difficulties, managers are increasingly investing in more speculative
vehicles to try to increase profitability, thus putting at risk more
private pension bag.
According to The New York Times, 50% of the income of private equity
funds (private equity) and from the private pension funds, which between
2000 and 2010 have been paid only 17,000 million U.S. dollars in
commissions to managers their portfolios.
11
If it helps the banks lending again
Each new measure to support the financial sector bailout, millionaire
injections, guarantees with a state guarantee, etc .- has been coated
with the explanation that are essential for return flow credit and life
and the real economy.
But three years after incessant support, the credit is at very low levels. In Spain and worldwide.
A recent study from Bloomberg has shown that public support has been well above those known as very high.
After years of legal wrangling, the agency has gained access to the
guts of the aid program of the U.S. Treasury in the form of loans at
very low cost, which have benefited banks around the world. The official program of assistance (TARP) meant 700,000 million dollars,
but, between 2008 and 2010, the actual invoice of the global financial
system rescue U.S. program actually rose, according to Bloomberg, to 7.7
trillion, ten times more than the known.
According to research by the agency, the rain did not address the
liquidity credit in the economy, but to artificially strengthen the
balance sheets of firms-and, therefore, to re-shoot the bonuses of
executives, and lobby for jobs avoid further regulation of the sector.
In Europe, 2011 ended with another sign that this is a myth, while
Greece and countries are asked rescued draconian conditions in exchange
for aid, the European Central Bank offered unlimited credit to the
financial sector to only 1%, with three year maturity and with little
requirements for theoretically help get credit flowing to the real
economy.
The auction distributed half a billion euros to European banks, but
there it was: banks deposited more than 80% of what was achieved in the
ECB itself, in case you need it.
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