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Thread: Recession of 2008 and impact on the DR

  1. #3551
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    Default Yanadu Spider

    Quote Originally Posted by PICHARDO View Post
    Very soon the DR will produce its first factory line manufactured and assembled vehicle in the country!
    I know, the Yanadu Spider.....




    donP

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    And that's the best they could come up with? LOL!!!


    Figures!


    LOL!!!

    LOL!!!


    LOL!!!!!!!!!!!!!!!!!!!!!!

    Sigan calculando! LOL!!!!!!!!!!!!!!!!!

  4. #3553
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    Pichardo; any links on the data used would be nice

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    Quote Originally Posted by PICHARDO View Post
    (...) we'll weather the storm as usual.
    As usual?

    The wastewater/ drainage systems can't even handle a onda-tropical-downpour and thus even the shiny malls get flooded.


    donP

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    Quote Originally Posted by donP View Post
    As usual?

    The wastewater/ drainage systems can't even handle a onda-tropical-downpour and thus even the shiny malls get flooded.


    donP

    Ever driven down 441/17-92/a.k.a Orange Blossom Trail in Orlando during a heavy rain downpour, just from Lancaster all the way down to Sand Lake Road and some patches later down? You have to drive almost in the median of the road unless you want to row, row, row you car gently down the canal... (oops! meant the street)!

    They literally pushed a bobbing car in the water to the side of the road, in order to get a stuck lady out of it!


    So what was your post about again? Unique DR what?


  7. #3556
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    Default PICHARDO-Land

    Quote Originally Posted by PICHARDO View Post
    Ever driven down 441/17-92/a.k.a Orange Blossom Trail in Orlando during a heavy rain downpour, just from Lancaster all the way down to Sand Lake Road and some patches later down? You have to drive almost in the median of the road unless you want to row, row, row you car gently down the canal... (oops! meant the street)!
    They literally pushed a bobbing car in the water to the side of the road, in order to get a stuck lady out of it!
    Ayayayay, PICHARDO, now isn't that something.
    But listen, I know a stretch of mud road in Kenya, you would not believe it..........

    Quote Originally Posted by PICHARDO View Post
    So what was your post about again?
    Well, about the land of glamour malls and high rises...

    donP

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  9. #3557
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    Economist questions GDP figures


    Economist Ernesto Selman said yesterday, Monday 13 August that the Dominican Republic's GDP was overvalued. The vice president of the Regional Center of Sustainable Economic Strategies (Crees) said that according to an alternative set of indicators that he has devised, the GDP could be as much as 36% overvalued since 2006. He told Hoy reporter Ubaldo Guzman: "We used a series of indicators to try and find an alternative indicator and see if the behavior of the economy that has been published by the officials corresponds with the real economy."


    He said that they have developed an alternative indicator based on energy consumption converted into barrels of oil that are imported on a yearly basis. He said that they had looked at this indicator in the other countries in Latin America and they saw that there was a very tight correlation between energy consumption translated into fuels and GDP. Selman then said that in this country (DR) energy consumption translated into fuel consumption has gone in one direction while the GDP has gone in another. He said: "This does not correspond to what is happening in Latin America, the Caribbean or the rest of the world." He added that since 2002 and 2003 they realized that while energy consumption translated into barrels of oil remained relatively equal, the GDP, according to official numbers, has gone up. As a result he is calling for a revision and a change in the way the GDP is being calculated.

    ---------------------------------------------------------------------




    Talk about about clueless people! LOL!!

    Since 2002 the country has moved away from an oil based energy matrix, not only for the power generators dotting the territory, but for the commercial and industrial applications, transportation and even as early as some months ago, residential usage. What was once the Achilles Tendon of our country, now is the very base on a transforming economy.

    In less than a decade LNG gas imports from Trinidad alone come to represent one-half of the nation’s total energy matrix and is increasingly being now introduced in the commercial, industrial and public transport sector. Its impact on the nation’s once strapped power sector has been immense, with annual power sector savings of roughly over $1.2 billion.


    Not more than some months ago Cheniere Energy had signed a liquefied natural gas, <st1:stockticker>LNG</st1:stockticker>, purchase agreement with the BG Group which roared across the energy world recently.

    Just so you understand the impact alone on oil imports from that perspective:

    Basic Energy (BG) is an operator of generation, distribution and energy marketing in the Dominican Republic, where it is the leader in the private power generation sector. Basic Energy’s managed assets are Compania de Electricidad de Bayahibe (“CEB”), Consorcio Energetico Punta Cana – Macao (“CEPM”), CESPM and EGE Haina. The plants are located in the towns of Bavaro, Bayahibe, San Pedro de Macoris, Haina, Barahona, Pedernales and Puerto Plata. Today, Basic Energy plants have an installed capacity of over 1,000 MW.

    Now, EGE Haina: Basic Energy is a pioneer developer of wind energy in the country and it has put into operation the first wind farm of the Dominican Republic during the second half of 2012. This, the largest wind farm in the Caribbean, coupled with bio-mass and another three solar energy large scale investments in the country, have moved the once oil dependent energy matrix of the Dominican Republic into the most adaptable to current energy fluctuations in the global market.
    The Dominican Republic's oil imports instead of growing with the GDP as it's the usual with developing economies and a regular economic measures of the country's values, it has halted the expansion of oil and actually reversed the trend which is the common ruler for the LA region and the world's at large.

    The grand scale adoption of a diversified energy matrix by the DR, has create perhaps the single most dynamic economy of the whole Caribbean and Central American region. The adoption of renewable sources of energy like a present just initiated a degasification large scale project in one the country's largest landfills. This project will power the first mass transit system outside of the US territory of Puerto Rico. It's indeed a giant leap in the technology embrace this country of less than 10 million people has taken for the past decade.

    The DR is only importing oil because the Chavez sweet deal, to use the money to support alternative energy options for the country. The energy matrix of the DR ten years ago and the matrix of 2012 are two drastically different models!

    But like always clueless people open their mouth and show to all their ignorance and stupidity...

  10. #3558
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    The strange calculation of GDP done by Ernesto Selman
    CHALLENGED report that GDP could be overestimated by 36% SINCE 2006




    Olga Diaz Mora
    It is sad that a renowned economist and former top Central Bank official has ventured to raise through the press an idea that does not stand the slightest to evidence. It was so unfortunately done by Ernesto Selman, current vice president of the Regional Sustainable Economic Strategies (CRESS), on Tuesday August 14 in the Journal Today, saying that "the GDP may be overestimated by 36% since 2006 to date ". I had not referred earlier to the issue, hoping to allow to pass the time wisely and solemn of change of government on 16 August.



    His statement is particularly surprising because Selman was working as Advisor to the Governor of the Central Bank for three years, from 2004 to 2007, more than enough time, we understand, so he could experience the hard work involved in calculating the different macroeconomic variables that derived from national accounts.



    What this economist has said, this is so outlandish that seems not to be a simple miscalculation, which could happen to anyone, but must have another purpose; taking into account the momentous shift in the country with the change of command of the governmental authorities. But we will show that his claim has no basis.



    The first thing to do for a complete economist is to thoroughly investigate the source used. For the experience of the 30-odd years we have laboring with statistical information, we can say that before you post a result or issue on a financial opinion is vital to make a thorough investigation of the source of information and the methodology used to arrive at the result investigated, so as to avoid such glaring errors, like the one made with his strange Ernesto Selman calculation about the alleged overvaluation of the Dominican GDP, based, in its opinion, to the lack of correlation between GDP and energy consumption.



    In reaching its conclusion poor and inconsistent, Selman used, according to his research, statistics published by the Economic Commission for Latin America and the Caribbean (ECLAC), without investigating in depth the methodology used, ie, must take into account that the coefficient used by ECLAC barrels convertion for the volume of energy consumption in each country was not a constant, leading to large variations, as in the Dominican case.



    Wrong conclusion


    The economist concluded erroneously that the Dominican GDP was overvalued by 36%, using a very simplistic correlation of energy consumption, the main indicator of a sector such as energy and water, which contributes only 1.5% to GDP weighting insufficient to measure an "overvaluation" of GDP.
    What he should do (Selman) was first to ensure the most direct and reliable sources, such as statistical data from 100% of the financial statements of companies in the electricity sector and that are published by the Central Bank. With these figures verify the correlation between the behavior of the volume of energy consumed in the country and the real GDP growth had been found, to their surprise, that this correlation during the period 2004-2011 is 0.97. In other words, this indicates that in the country currently exists a strong correlation between the amount of energy consumed and real GDP, which is radically strange calculation of this economist, as seen in the following graph:






    Contrary to what was stated by my friend Ernesto, at regional level, shown in the following table published by ECLAC that comparing the share of value added of the electricity, gas and water in the GDP, the Dominican Republic shows a weighting similar to the average for Latin America and maintains a constant corralation, reflecting their growth is also in harmony with the evolution of the total GDP.



    We believe that any economist who has a minimal knowledge of the methodology of national accounts, SCN93, which is applied worldwide, could argue that the level of GDP can be measured only by the degree of correlation with the amount of energy consumed as in the measurement of GDP involved countless indicators that have greater participation and could impact more on their assessment and their evolution.For example, in a period of GDP growth could be related to activities heavily dependent on energy consumption and at other times might be affecting economic activities that are not closely related to energy.




    Graphic


    As an example, in the second graph shows that in 2000-2003, the Dominican economic growth was influenced by the dynamism of the telecommunications and tourism, activities that are intensive in the use of energy, and therefore the correlation coefficient energy / GDP was 0.77, unlike what happened in the past seven years (2004-2011) in which the coefficient is 0.97, meaning that there is currently a high correlation of nearly one to one.
    As demonstrated in everything technically raised above, that the overvaluation of GDP can not be sustained in the correlation with a sector that weighs just 1.5% of GDP, the statement of my friend Ernesto Selman makes us think that, given the unfortunate timing that this economist has used to publicly report his strange calculation, it seems that his real intention is to try to reduce the level of total GDP for different ratios presented in GDP increase. Such is the case of the debt / GDP, which would rise and would involve a debt overhang of the country. In the case of the tax burden, it would decline to imply that there is mandate for fiscal reform, and to the contrary will present a GDP per capita of U.S. $ lower, which could demonstrate a lower level of welfare of the general population. All these changes would entail many difficulties nationally and internationally.
    Boasting of friendship that unites us Ernesto Selman, after three years of joint work in the Central Bank, and the protection and good treatment he received from the Central Bank authorities, especially the Governor, we would reiterate that his strange calculation of GDP suffers from inconsistencies and to be expressed slightly through a media, does nothing but create false expectations. It seems that this friend colleague pursues one goal: "fish in troubled waters" and show that you do not need a tax reform to integrate it. But what a poor service to the country! VEREDES THINGS, SANCHO!
    The author is an Economic Advisor to the Governor of the Central Bank.

    El extraño cálculo que hizo Ernesto Selman del PIB - listindiario.com










  11. #3559
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    Since 2002 the country has moved away from an oil based energy matrix, not only for the power generators dotting the territory, but for the commercial and industrial applications, transportation and even as early as some months ago, residential usage. What was once the Achilles Tendon of our country, now is the very base on a transforming economy.
    Really Pichardo. You import and consume 55,000 bpd of oil. So how have you moved away? To be sure, you are swapping diesel for nat gas in the power plants, and you are building wind and solar farms to meet increased electricity demand.....but you are not moving away from oil anytime soon.

    In less than a decade LNG gas imports from Trinidad alone come to represent [B]one-half of the nation’s total energy matrix and is increasingly being now introduced in the commercial, industrial and public transport sector. Its impact on the nation’s once strapped power sector has been immense, with annual power sector savings of roughly over $1.2 billion.
    "Once strapped power sector".......Still strapped and growing worse by the day is more like the reality.

    Electricity sector in state of emergency
    The vice president of the State Electricity Companies, (CDEEE), Ruben Jimenez Bichara, has repeated his warning about the economic crisis that is affecting the CDEEE, saying that the electricity sector is in a state of emergency.

    He has said that the level of debt owed by the electricity generators is close to one billion dollars, and that the CDEEE was going through the biggest financial crisis in its entire history.

    Rubén Bichara:


    --------------------------------------------------------------------------------


    Not more than some months ago Cheniere Energy had signed a liquefied natural gas, <st1:stockticker>LNG</st1:stockticker>, purchase agreement with the BG Group which roared across the energy world recently.

    Just so you understand the impact alone on oil imports from that perspective:

    Basic Energy (BG) is an operator of generation, distribution and energy marketing in the Dominican Republic, where it is the leader in the private power generation sector. Basic Energy’s managed assets are Compania de Electricidad de Bayahibe (“CEB”), Consorcio Energetico Punta Cana – Macao (“CEPM”), CESPM and EGE Haina. The plants are located in the towns of Bavaro, Bayahibe, San Pedro de Macoris, Haina, Barahona, Pedernales and Puerto Plata. Today, Basic Energy plants have an installed capacity of over 1,000 MW.

    Now, EGE Haina: Basic Energy is a pioneer developer of wind energy in the country and it has put into operation the first wind farm of the Dominican Republic during the second half of 2012. This, the largest wind farm in the Caribbean, coupled with bio-mass and another three solar energy large scale investments in the country, have moved the once oil dependent energy matrix of the Dominican Republic into the most adaptable to current energy fluctuations in the global market.
    The Dominican Republic's oil imports instead of growing with the GDP as it's the usual with developing economies and a regular economic measures of the country's values, it has halted the expansion of oil and actually reversed the trend which is the common ruler for the LA region and the world's at large.
    And where did you find all this?

    Basic Energy is a mid sized Texas firm that services and repairs oil rigs. Last I knew, they do not manage power plants whether they be wind, solar or otherwise and they are not involved in generation, distribution and energy marketing in the Dominican Republic.

    The ticker symbol BG is for Bunge Corporation and they have nothing to do with managing power plants and they are not involved in generation, distribution and energy marketing in the Dominican Republic.

    Last I knew, BG Broup, British Gas Group (BG.L) was an E&P company.

    Perhaps you can provide some clarity.

    The DR is only importing oil because the Chavez sweet deal, to use the money to support alternative energy options for the country. The energy matrix of the DR ten years ago and the matrix of 2012 are two drastically different models!
    You are importing oil because you have to, not because of Chavez' sweet deal. As I stated above, the DR imports and uses 55,000 bpd of oil. No amount of alternative energy is going to supplant that need for a long long time. Sorry to further burst the bubble, but other than some wind and solar projects, the vast majority of your energy needs are still satisfied with fossil fuels....much like in 2002.

    As a postscript, the IMF is getting ready to ride back in to rescue you again with another loan. As you will recall,the IMF had been funding you in return for certain promises, i.e pay the energy ditributors no more than 45 days in arrears, raise rates on electricity, etc. And, as you will further recall, Leonel decided to suspend the IMF Stand by agrrement in March so that he did not have to implement those taxes so close to the election. In return, the IMF stopped providing loams to that dynamic economy you keep referring to. Without those loans, the government has been unable to pay the distributors and thus we have a serious arrearage again in the electricity sector.

    But, don't worry. Very shortly (September), the IMF will be back and new loans will be written, rates will be raised, and then the DR can go happily on its way toward the fiscal cliff.



    Respectfully,
    Playacaribe2

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    Quote Originally Posted by playacaribe2 View Post
    Really Pichardo. You import and consume 55,000 bpd of oil. So how have you moved away? To be sure, you are swapping diesel for nat gas in the power plants, and you are building wind and solar farms to meet increased electricity demand.....but you are not moving away from oil anytime soon.
    There is no replacement for oil. It's the same baloney we hear daily on how the US Dollar is going to be replaced. There is no method that replaces oil and the dollar which doesn't involve pain. If they want a quick change that will only bring about economic dislocation, political turmoil and social unrest. These quick fixes are mere ideas for public consumption and are clever tactics to appease the electorate of the respective govts behind these moves. The point is that if an entity or structure be it organic or otherwise is forced change immediately, that structure will experience severe shock.

    The global central banks have made it their task to ensure that anything that comes close to such a sudden reset be it economically, energy usage or reserve currency status will be left untouched. Since that's the case the DR will continue to depend on oil imports without which it will experience the crisis that Cuba went through and is going. Wind and solar energy are just pipe dreams. They are very expensive to implement and the maintenance is beyond whatever the DR has to offer. 55,000 barrels is a number which will only drop once the collapse in demand begins in earnest.

    "Once strapped power sector".......Still strapped and growing worse by the day is more like the reality.

    Electricity sector in state of emergency
    The vice president of the State Electricity Companies, (CDEEE), Ruben Jimenez Bichara, has repeated his warning about the economic crisis that is affecting the CDEEE, saying that the electricity sector is in a state of emergency.

    He has said that the level of debt owed by the electricity generators is close to one billion dollars, and that the CDEEE was going through the biggest financial crisis in its entire history.

    Rubén Bichara:
    One can only imagine the response that Pick the Father will give. "Those are strategically placed discourses to force the other side to come to an agreement which will favor the DR negotiating time." It's so laughable to even consider his response to what the VP of CDEEE has stated. The CDE is in a state of collapse but for us PC, CC and others it isn't headline news. We all knew that accumulating such debts would end badly. Maybe the IMF will come in once again and lend them more money to cover this debt.

    The problem with the DR and the world is not a liquidity issue. It is a solvency issue. It doesn't matter how much money they throw at the problem. The DR is bankrupt and broke. They only exist as a going concern because of all the money they borrow. More borrowed money = a rise in GDP. They can never come off of it. The IMF will have to continue lending it money so that "old" monies owed it will be repaid. It is absurd but if the IMF wants the DR to pay back its debts it will have to continue lending it money.

    If the IMF stops lending the DR money, then the DR will not be able to pay. To ensure future payments, they'd better ensure future loans. There is nothing within the DR state outside of this. Like I said, it is not liquidity. It is solvency. The DR state is no more alive than a dead corpse being transfused blood. Sure you can give a corpse blood transfusions and actually circulate blood around its veins giving it the appearance of life and even fool non-medical specialists but it doesn't change the fact that the patient is dead.

    In like form the DR is dead. It is being given the appearance of a growing economy because of the blood (loans) that is being transfused throughout its system. You see brand new METROS, new malls, new buildings but since most aren't economics specialists, they don't see that the entity is dead. There's nothing there that can hold it together in the absence of these loans. In the absence of these loans, aid monies, and remittances whatever real economy is left could not survive independently. As cells need nourishment to live so does the real economy. Since that nourishment is a steady supply of loan money the DR economy continues going.

    That's the crux of the matter. Take away the life support systems and what you have is nothing that can hold the DR economy and make it grow. The DR's saving grace though is the debt forgiveness it has received to the tune of hundreds of millions of dollars in the past and steady streams of new money. Maybe they'll get another pass. It is its history. But, if ever the DR is forced to get religion, then we'll all see what is really there once the tide pulls back

    Basic Energy is a mid sized Texas firm that services and repairs oil rigs. Last I knew, they do not manage power plants whether they be wind, solar or otherwise and they are not involved in generation, distribution and energy marketing in the Dominican Republic.

    The ticker symbol BG is for Bunge Corporation and they have nothing to do with managing power plants and they are not involved in generation, distribution and energy marketing in the Dominican Republic.

    Last I knew, BG Broup, British Gas Group (BG.L) was an E&P company.

    Perhaps you can provide some clarity.
    LOL, you got Pick the Father fibbing. GOOD JOB, I missed that one.

    You are importing oil because you have to, not because of Chavez' sweet deal. As I stated above, the DR imports and uses 55,000 bpd of oil. No amount of alternative energy is going to supplant that need for a long long time. Sorry to further burst the bubble, but other than some wind and solar projects, the vast majority of your energy needs are still satisfied with fossil fuels....much like in 2002.
    You damn straight on this one. The DR has no choice and if it wasn't because Chavez basically gives it for free the DR would see a whole lot less cars and a much smaller economy. It would have been better for the DR for that to have happened. By Chavez subsidizing the DR with what amounts to free oil, he has created a problem. Not only his free oil but add in the IMF and they both have created the population boom within the DR. The problem is that it is subsidized. The DR population increase is a direct result of all the credit expansion coupled with Chavez freebies.

    Basically the DR population, a substantial part of it, is operating like a leveraged entity. Once the freebies, the support and the aid is removed you'll have a large percentage of the DR population not supported by any means. They'll be up in the air. So just like leveraging which as the name implies it's supporting alot with a little, the DR population, a good chunk, is not supported at all by anything. It is basically leveraged in that there is the appearance of their being something actually supporting it but the support is not built on sound economic principles. It is credit driven.

    As a postscript, the IMF is getting ready to ride back in to rescue you again with another loan. As you will recall,the IMF had been funding you in return for certain promises, i.e pay the energy ditributors no more than 45 days in arrears, raise rates on electricity, etc. And, as you will further recall, Leonel decided to suspend the IMF Stand by agrrement in March so that he did not have to implement those taxes so close to the election. In return, the IMF stopped providing loams to that dynamic economy you keep referring to. Without those loans, the government has been unable to pay the distributors and thus we have a serious arrearage again in the electricity sector.
    That's another sector as stated where the collapse spoken about by the VP of the CDEEE has been giving free electrical service to the people for decades. Not only have the poor been subsidized but the rich also. How so? If the DR were forced to pay that 1 billion owed full and payable on demand right now, how high would they have to raise rates to make up for the shortfall? There is isn't an amount of money that could cover such a debt being accrued over many years. They'd have to shut down the national electrical grid until they could come clean with what they owe or declare bankruptcy because it is clearly bankrupt.

    Then what? The DR would have no electrical means whatsoever. The DR would spiral into chaos or it would at the best of it crater economically. That's the present state of the CDEEE. They do not have the means to pay the private generators. These guys can hold on for how much longer? How much longer can they like Chavez susbsidize the DR's population's need for electrical service. Chavez can outlive them in this game. The DR govt has played a piecemeal game with them for decades but eventually the piper has got be paid. Maybe the IMF will once again save the day in order to save it self??

    But, don't worry. Very shortly (September), the IMF will be back and new loans will be written, rates will be raised, and then the DR can go happily on its way toward the fiscal cliff.



    Respectfully,
    Playacaribe2
    Definitely, the IMF will once again ensure the DR does not drown into the sea. It is clearly evident that the DR can not function on any front independently. As a sovereign they are insolvent, bankrupt and broke. But if it comforts those here so are most nations on Earth. It is a race to the bottom as evidenced by the death marches being carried out by currencies. The dollar is dying and so is the peso. The peso is doing it at a rate 40 times faster than the dollar. Once its all said and done, we'll be wishing for these good ole days to return.

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