At the press conference of January 30, held in Trinidad, and discussed in last week’s column, Chairman Duprey of the CL Financial Group had indicated that the credit squeeze caused by German bankers refusing the company credit was a main reason for its troubles. Just prior to that, however, his statements in regard to the effects of the global economic crisis on the group’s business were very boastful. Duprey claimed there were very good business opportunities arising from the global econo...Read more
As promised last week, this week I begin a review of the CL Financial Group meltdown. I shall start with a broad description of the company structure and main operations just prior to the meltdown.
Structure and operations
The CL Financial Group is a holding company headquartered in Port of Spain. It had more than 70 subsidiaries and affiliated companies at the time of its meltdown. The group operates in over 32 countries. The principal regions...
In this week’s column I shall conclude the discussion on Stanford Financial Group started last week. Following that, over the next few weeks I shall undertake a review of the CL Financial Group, Trinidad and Tobago. As we shall see, like in the case of Stanford Financial Group, there are many important lessons to be learnt from the Guyana standpoint in that firm’s financial meltdown.
Lessons to be learnt
From last week’s discussion of the Stanford Finan...
Smelling the stench
In recent years, individuals who have had their ears close to the ground in Caricom’s financial, accounting, business, professional, and other expert circles, could not avoid being aware of the sordid doubts and deep misgivings swirling around corporate governance at the Stanford Financial Group. Even if some persons were inclined to give the group the benefit of the doubt, certainly there were enough misgivings around for prudent persons to exer...
In last Sunday Stabroek I had started a discussion on what I described as the “crisis of credibility” facing actions by the government and its functionaries on economic matters. This credibility gap runs throughout the entire gamut of economic matters, from review and analysis of the current situation and recent trends to the setting of targets, framing of policy proposals/programmes/projects, and the efficient execution of these.
I have so ...
No easy remedy
Behind the sound and fury in public debates, self-serving government pronouncements, and the studied misdirections and deceptions in statements made by various economic authorities, readers should be reminded that presently we are witnessing the confused economic responses of a state, whose essential dynamic continues to be a vehicle for criminal enterprise. As such ostrich-like and make-believe public policies, the real risk of regulatory meltd...
When a sectoral regulatory authority, in this instance for the insurance sector, takes the position that regulatory intervention as prescribed by law would be prejudicial to a party that is involved in regulatory evasion and abuse, because such intervention “would have precipitated the demise of the company to the immediate detriment of policy holders,” it means one of two ghastly things, both of which reveal a deeply flawed legal-regulatory-institution...
The grimness of the global economic environment is so intense that those who shout “make-believe” economics will sooner, rather than later as the saying goes: “have to eat their words.” Last week, (SN February 22) I expressed incredulity that the 2009 National Budget could be so much in the land of “make-believe” as to predict (target) a rate of growth of real GDP for this year at 4.7 per cent.
As I pointed out in that column, this rate of gr...
Economics is essentially a discipline based on commonsensical principles and ideas. These are then expressed precisely, with logic and theoretical rigour. And, more often than not, they are supported with the use of mathematical techniques, and statistical analysis and inference. It is for this reason I believe that when government and its functionaries make economic pronouncements which violate common sense, ordinary Guyanese dismiss these as ‘vo...
In last week’s column I had introduced the first of eleven economic shocks/challenges that rocked the Guyana economy in the second half of 2008. That was the “financial crisis and credit crunch” which erupted in the United States during September-October 2008. The epicentre of that first shock/challenge was the bursting of the US private housing market bubble. In retrospect, we can now observe that early signs of this untoward development passed virtually unnoticed as far back as the latte...Read more
Faculty of Social Sciences
- University of Guyana, Turkeyen Campus
- +592 222-4927