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**objennasweene** · 01-01-2006, 07:00 AM

It's awefully unrealistic to expect LF (or any other mortal) to undo 4 years of damage in 3 months. What I think important are:

1. The good intention: This alone puts him light years ahead of HM, who never had real intention to fix anything for the benefit of average Dominicans.

2. Expectation management: LF has successfully projected (at least until now) an image that he is walking the walk. Sure, it's too early to see the results, but he has already started purging the police force, forcing them to return stolen vehicles, reduced public payroll and cracked down on tax evasion and turned up patrol to fight crime.

3. Regaining credibility: While no govenment is ever totally trustworthy, LF has brought back some modicum of credibility, which was completely bankrupt under HM. The fact that he has managed to shore up Central Bank reserve, lower exchange rate from 45 to 31, reduce interest rates, induce more foreign investment..etc in 3 months is no small feat. We should keep in mind that the success of economic policy of any nation depends largely on the public confidence. Alan Greenspan was successful and persuasive in his rate cuts/increases because the public believed in his rationale. No so with Malkum. This is the critical difference between US and DR, where RD$ dropped the further the PPH tried to talk it up. While in the US, when John Snow said there was room for US$ to devalue (or words to that effect), it soon did in the international market.

One crucial test is whether LF will manage to lower prices across the board to reflect the benefit of a stronger RD$, if not, I expect the economy to stagnate as purchasing buyer for Dominicans and foreigners alike continues to drop.

Purchasing already stagnating. Gringos wintering over in other islands this year, and property values have declined in 2 months by 30%.The stupidity of dropping the exchange rate so rapidly has just forced many people to look for better alternatives. I tell people not to come unless they are prepared to pay double for electricity and gas., and triple for gas oil for the planta , four times what they paid last year in restaurants and five times more at the hardware stores, and the list goes on and on.

01-01-2006, 07:00 AM	#7
objennasweene Join Date Nov 2005 Posts 465 Senior Member	It's awefully unrealistic to expect LF (or any other mortal) to undo 4 years of damage in 3 months. What I think important are: 1. The good intention: This alone puts him light years ahead of HM, who never had real intention to fix anything for the benefit of average Dominicans. 2. Expectation management: LF has successfully projected (at least until now) an image that he is walking the walk. Sure, it's too early to see the results, but he has already started purging the police force, forcing them to return stolen vehicles, reduced public payroll and cracked down on tax evasion and turned up patrol to fight crime. 3. Regaining credibility: While no govenment is ever totally trustworthy, LF has brought back some modicum of credibility, which was completely bankrupt under HM. The fact that he has managed to shore up Central Bank reserve, lower exchange rate from 45 to 31, reduce interest rates, induce more foreign investment..etc in 3 months is no small feat. We should keep in mind that the success of economic policy of any nation depends largely on the public confidence. Alan Greenspan was successful and persuasive in his rate cuts/increases because the public believed in his rationale. No so with Malkum. This is the critical difference between US and DR, where RD$ dropped the further the PPH tried to talk it up. While in the US, when John Snow said there was room for US$ to devalue (or words to that effect), it soon did in the international market. One crucial test is whether LF will manage to lower prices across the board to reflect the benefit of a stronger RD$, if not, I expect the economy to stagnate as purchasing buyer for Dominicans and foreigners alike continues to drop. Purchasing already stagnating. Gringos wintering over in other islands this year, and property values have declined in 2 months by 30%.The stupidity of dropping the exchange rate so rapidly has just forced many people to look for better alternatives. I tell people not to come unless they are prepared to pay double for electricity and gas., and triple for gas oil for the planta , four times what they paid last year in restaurants and five times more at the hardware stores, and the list goes on and on.
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