"The government's economic policy message is still not getting through to many Finns, despite an early-year communications operation.", YLE
So are you the one who is still confused about the government stimulus plan?... "the Stimulus", what's that?, well it's not a bone, so what is it? here a definition adapted from the "Big Picture site"
Q. What is an Economic Stimulus Payment?
A. It is money that the government will send to taxpayers.
Q. Where will the government get this money?
A. From taxpayers.
Q. So the government is giving me back my own money?
A. Yes and No, they are borrowing it from Institutional investors: Pension fund indirectly you, and others.
Q. The government will be able to maintain good job level?
A. you can dream. They will never replace the private sector.
what they can do at best is to replace job that will be lost, especially in the construction sector hence they will build bridge and obviously Opera (Politicians don't lose job)
Q. So the government is selling debt, who will buy that?
Anybody in fact, You can buy debt(Bond), if you have lost sense of reality. government bonds that gives you 2.4%/year until 2012 - needless to say it will be the worse investment at this moment.
Pension funds have big liabilities and need to have secure investment, thus they will probably be pushed, because of regulation, to purchase those bonds hence indirectly it's your money that will be used to fund part of the debt in this case. (-correct me if I'm wrong here-)
It might as well be country such as china or even Russia (though I doubt since they have their own stimulus to kick in), so any country that needs to have Euro exposure and put it in a country that won't default on its debt.
Q. What is the purpose of this payment?
A. The plan is that you will use the money to purchase a high-definition TV set, the latest gadget and travel to Thailand, keep paying high rent... thus stimulating the economy.
Q. But isn’t that stimulating the emerging market economy?
A. Shut up.
11 comments:
Well, minister asked us to speak politics in the pub. I told him we do and one has made some notes as well.
http://www.alexstubb.com/fi/blog/?f_comment=yes&id=1320#commentform
Another thins I wonder is that when you make a crime you are being taken to jail, aren't you.
But financial crimes are no ones mistake or crime, it is all about wrong politics with George Bush or some other meaningless opinion ...
I think one has utilize stupid politics with very dangerous way but they will never get paid for that.
Justice for all ....
They should be even scared that big brother is behind the door in any day.
One has to remember that the main role of politicians is to keep the society cohesive, fair and stable.
Unfortunately sometime Politicians forget that and work for their own interest or their ideologies.
Some striking example were in Ireland,Iceland and Spain where politicians decided to turn a blind eye on what has destabilized the whole country : Greed, Corruption and ideology.
Now it is the people will pay for that.
You can put banker in the same bag as politicians as during boom time they collect a fortune and are portrayed as genius ....now they managed to destroy the foundation of the financial system, yet they will not pay back the fortune they literally robbed.
To summarize, Banker+Politicians = Donkey.
In Finland, it's a mix bag. Certainly people at the helm of the country have an agenda. For example they are going to build an Opera, while at the same time, there is massive queue for public healthcare, isn't that amazing? though the media doesn't seem to worry, as most probably there will be recipient of those entertainment...
So a time where hospital should be created instead of wasting the money for hearing herrings screaming non sense for an hour or two to please a disconnected layer of the society that have been tagged as the elite ...
Housing Finland last year you were sounding like you worked for the european central banks big buisinesses and the elite. You sounded like you were part of the plot to bring about the one world currency etc.
Now you sound like you are going to the other exstreme.
I think part of the solution to this situation is to see that fascism is alive and well. I find it hard to believe that our corporate parents were so imcompetant. I think part of the solution is to see that here in Europe there was a degree of resonsibility and care taken with finances so that they tend to be well managed just as you were saying last year, while also seeing that things are not now as bad as you are now believing them to be as you blame all the people you were supporting earlier.
Dear Andrew, banker and central bankers are different.
I have the utmost respect for Jean-Claude Trichet, the European central bankers as its forecast and suggestion on economic outlook have always proven right, which is total opposite the prediction made by Finnish Finance ministry back in September
Back in September, I put my outrage in one article
http://housingfinland.blogspot.com/2008/09/super-k.html
in this blog , since I though their forecast were a piece of nonsense, at the same time I said as well that Russian trucks crossing Finland is something from the past, and we won't see them for a quite long time (1-2 years at least).
So, most probably, you misunderstood me as you just have to look at my past articles since it is a stamp of the view I had.
I am sorry but I do not see that the economy will grow the way you think. We are only half way in these mess, at best.
Few countries will not survive this meltdown if not bailed out by the IMF or the EU and I'm not sure whether Finland will be or not part of them.
Finland trading partner are all but collapsing, and it is not a budget surplus that is shrinking in an alarming rate that will change the equation.
If the Baltics are not bail out and soon, if Russia doesn't recover and soon and if Sweden continue its currency devaluation game...then you will see double digit unemployment figure in this country, within a year, with all the characteristics it brings.
I'm sure that government will work hard to avoid that: they have no choice.
Another point you can support someone that later deceive you. I suppose Obama could be in that camp depending on its future action.
In this blog I have highlighted that you got to be pragmatic and not stay fanatically stick to one idea: the world is changing so you should too, in term of skills, investment (as I said housing will most probably fall for the next 5 years, if you don't change your view, you will lose big...same will apply to stock market, give it a year or two)...
funny how your mind reading skills are so inaccurate.
If i talk about deflation not being likely you tell me i am talking about hyperinflation coming and if i suggest that things will not be as bad as you are saying you tell me i am talking about growth.
In some part I used "You" addressing any reader in general, in the end...
i have said before i dont do future predictions but here is an example of the way Finland alters what we might expect is going to happen in ways that might not be so clear.
http://newsroom.finland.fi/stt/showarticle.asp?intNWSAID=21014&group=Business
Rents are rising. Not what you might expect but if people dont want to buy their own homes at the moment you will expect that. Anecdotally people are buying up cheaper rental flats and renting out with low interest rates - better than bonds in my view. But bonds last year were very highly profitable as price rose dramatically as yields fell dramatically - i suppose. That cannot now be repeated though.
Currently you can buy an older one bedroom 30 m2 flat in lauttasaari for around 135,000 on a mortgage of around 3.5%. A ballsier person than me could now perhaps create a property empire and wait for a recovery. Money in the banks is not entirely safe and a rental income and a mortgage mean that if inflation returns the ability to become wealthy is clearly there.
Then there is this:
http://newsroom.finland.fi/stt/showarticle.asp?intNWSAID=21012&group=Business
So the banks and even the local authories, who have no interest in prices falling, can create that reality by not supporting elements of contruction spending that might cheapen rents.
For example two years ago in the USA it seemed not possible to me that new house construction would be supported by the government when there was surplus housing. Instead the builders drove prices into the ground by selling like there was no tomorrow and offering all manner of insentives. New home construction spending was so much a part of the economy that perhaps builders were able to lobby their way into helping to create more of a disaster?
But finland is a very highly regulated society - unusually so in my view. Having house agents in the banks is a bit weird and yet given the nature of house agents not entirely a bad thing. And i like Finland and its people and the world from a distance admires the Nordic way also.
Even so it is a reality that Finland cannot 'do well' if the rest of the world descends into a depression.
Then in Finland we talk about a skills shortage for traditional male skills in factories and we talk about an aging population and a need for more working people and we talk also about rising unemployment. That does not really add up.
As i say i dont do future predictions. What i do is examine what i know as best i can and then look to see how that changes.
There are for example a few enhancable own home houses available in Helsinki today whereas there were no attractive ones last year catching my eye i could afford. Flat prices have fallen. And it seems rents have gone up. Our own rent in Tuusula went up in January, and until people start moving out of this appartment building rents are not going to be driven lower.
Are we seeing an increase in houses for rent? Something to look for. As far as I know there are only a very few own home houses to rent in the helsinki area that an ordinary waged person could afford to rent and only a few of those more expensive.
Are we really going to see sufficient supply of these own home houses on the market that it will reduce prices of easy to sell properties?
Can we actually find out the prices houses are selling at?
In the UK and in NZ it is easy to know this. Here it might be protected information for the benefit of market regulators.
It is different in Finland. And because we know there is a difference it is reasonable to say it will make a difference. The only question then is how much of a difference.
About transaction prices:
http://asuntojen.hintatiedot.fi/
>>About transaction prices:
http://asuntojen.hintatiedot.fi/
Thanks. Unfortunately they dont allow online viewing of 'own home houses' or Omakotitalo.
These are available if you phone up the property register and quote the land title number which makes it problematic to do market analysis.
I have been following Omakotitalo via asking price reductions and time to sell - better than nothing but not the same as knowing what was recorded on the sale document - and actually a bit of hard work!
Regarding the Rents, they will go down it's a matter of supply and demand. The supply is increasing as builders and private put their asset in the renting market: they do not want to sell, at price they think are not justified which I think is wrong. The same idea for those people that did not sell stocks at 10 percent lower thinking that price will rebound to later lose 50%, that's the reality of the market...
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