Trésorier/Treasurer magazine - N°85 - April/May/June 2014 - (Page 77)

ONLINE The Risk Observatory FR/EN VERSION by Hugues Pirotte (FinMetrics) In Europe, far from "those crazy countries", we have been cultivating also a form of antagonism between the public sector and the private sector. And with the crisis, it seems we have provided a sesame pass to anyone who would have an idea to revamp the system and its rules, as modern alchemists, or to push any further towards the negation of the importance of the private sector. But I am not alone in that debate. The Economist of last week has a full 14-page report on this. We must be careful about refusing simplistic speeches that share the perception that both sectors are antagonists. They need each other. New regulations and taxes are too often created with the main argument just being that it is right to handcuff more the private sector. Whichever ideology we believe in, we must refuse this naïve speech, not because of the latest discussion on a new tax or a new regulation, but mainly because of the values we are promoting in the medium to long run2. It lets people believe that this is the right form of thinking. Of course, the propagators know the difference but they know also that even a biased speech can convince more electors to vote for them in the short run. But slowly, and probably imperceptibly, we 1. I invite you to look at the list of Venezuelan presidents to realise that the history of this country can are tipping towards dangerous logics. After having tacitly accepted the formation of a new paradigm, it will be too late to react. A clash will then be inevitable even if the first detractors didn't really want it. In finance, no one can really negate that some institutions and individuals have been abusing the system and its participants, mainly because of a lack of good governance aiming at reducing agency conflicts. But that shouldn't mean that anything going unilaterally into the direction of more handcuffing is by definition good, and that anyone protesting about trying to find a better equilibrium is devilish. Otherwise, we will end up confronting cynical professionals - accepting the reality and trying to circumvent it as much as they can until the clash - to cynical authorities that don't want really to understand the consequences of their new ruling as long as they look like "politically correct". Venezuelans will then look at us and say, "those crazy countries". If you do not like private sector practices, the grass is not necessarily greener with public sector practices. It might be the case, but only if you decide for it, not if you suffer from it because it was passively accepted. / MAY / JUN 2014 I'm afraid the column of this quarter is somewhat influenced by my first half-life in Venezuela and the events occurring there during the last two weeks, not to say the last 15 years. The link with this rubric should be tangible after a few lines. This article should be read leaving ideology out of the debate to concentrate on the factual analysis. By the end of the 50's, Venezuela went back to a democratic system. By the end of the 90's, this rich country, initiator and co-founder of the OPEC, ended up back in a totalitarian system1 , where the elected president based his success on cultivating hate between classes and on generating a sterile battle between the public sector and the private sector. Today, people are in the streets because they need to queue for food and hygienic paper in a country that is one of the major oil producers in the World, not to mention other mineral resources. But "this could never happen to us...". I beg to differ. The contrast had to be big for Venezuelans to realise that this could go no further. Remaining here apolitical, it had to be big enough to realise that we should care more about (really) helping the poors, but it had also to be big enough to realise that spreading fear and disruption would in no means bring better living standards to the population. The goal never justifies the means and stability needs equilibrium. Tautological but hard to achieve. LE MAGAZINE DU TRESORIER / TREASURER MAGAZINE - N°85 - APR The World around us be indeed described as a continuous oscillation between so-called democracies and dictatorships since its independence in 1819.3. www.nature.com/srep/2013/130926/srep02759/full/srep02759. html4. Source: World Economic Outlook Database, IMF Calculations 2. Those who have played with those naïve speeches will always be faced with even more populist people at some point. 77 http://www.nature.com/srep/2013/130926/srep02759/full/srep02759.html

Table des matières de la publication Trésorier/Treasurer magazine - N°85 - April/May/June 2014

Couverture
SOMMAIRE
EDITORIAL
FINANCIAL HIGHLIGHTS Luxembourg Tax News
INTERVIEW L’impact du nouveau référenteil COSO sur les trésoriers
FOCUS
FORUM
CORPORATE FINANCE
15 MINUTES WITH LCTE
NEWS
THE FINANCIAL RISK OBSERVATORY - The World around us

Trésorier/Treasurer magazine - N°85 - April/May/June 2014