Wednesday, June 25, 2014

US Lead War in Iraq Will Not "Stimulate" US Economy

As the US continues to slide economically with dire consequences for the Trinidad and Tobago economy, economist will postulate that escalating sectarian conflict in the Middle East which could trigger another US lead war will be economically beneficial for the US. 

The above however is false -as wars and military engagements drain limited economic resources that could otherwise have been utilized more productively. Ultimately wars only serve the economic interest of the politically connected military contractors and the military industrial complex at the expense of taxpayers.

Although in the short term higher oil / gas prices will increase T&T's revenues; after the dust settles the US will be deeper in debt and further compromised economically.

Saturday, June 14, 2014

An Underlying Cause of Child Neglect and Abuse in T&T

While Trinidad and Tobago remains shocked and dismayed by the recent spate of child abandonment and abuse incidents many religiously look toward the government as the messiah. Yet they fail to recognize that the family and societal dysfunctionality is as a direct result of a parasitic state apparatus sapping productivity and purchasing power thereby placing major strain on the family unit.

Consider that inspite of the growth in the budget, the scope and presence of the various regimes of the last 51 years the society and the culture in Trinidad & Tobago is in decline. Why is this? It is because the growth of government comes at the expense of the individual and the family. 

Tuesday, June 10, 2014

Putting The Phoenix Park Gas Processors Limited IPO In Perspective

Once again given the limited investment options caused by onerous, unnecessary securities regulations and the excessive liquidity in the T&T economy caused by Central Bank monetary expansion (legalized counterfeiting) everyone is clamouring for the upcoming PPGPL Initial public offering (IPO).

Although the business model appears sound buyers should be cognisant of the potential downside risks that are not being mentioned. Prudent investors would be wise to note the following: 

1. ConocoPhillips would not have disposed of a top performing asset to begin with inspite of the rationale provided for the disposal. Often times when the going gets tough energy majors bamboozle clueless governments like the T&T government to overpay for assets that they deem to have outlived their usefulness.

2. Petrochemical plants and infrastructure are normally amortized over 20 - 25 years which is consistent with their normal useful life. Coincidentally PPGPL is 25 years old; granted they would have been doing on going upgrades / maintenance, however PPGPL's infrastructure may likely need major turnarounds / maintenance soon.