In the last couple of days I have once again started to receive bogus invoices. The covering text at first glance is convicing as it refers to services which my company could conceivably order. The scam is similar to the old telex directory listing invoices in as much as the invoices are for small amounts, which in many companies could be automatically entered in the purchase ledger without checking.
There is also the risk that the e-mails carry spy ware which would assist in further fraud.
Some of the e-mails were sent from addresses which are clearly fake but in some cases they show the domain name of a bona fide supplier.
So in case of doubt delete.
Probably better late than never but both Polish Presidential candidates have addressed the issue of pensions and the retirement age. The PiS candidate has of course gone down the populist route of stating that people will have to work till they die. Which completely misses the point that people are living longer with the Polish male now having a life expectancy almost a decade longer than when the Berlin Wall fell.
The incumbent President announced yesterday that he will present a parliamentary bill allowing workers to retire after “clocking up” 40 years “in harness”. What was not mentioned is the fact that there would not be an entitlement to a full pension for people who retire early and this will only accrue fully to those who work until the statutory retirement age. Now there is a difference between allowing people to retire early and bringing down the statutory retirement age. Just don’t expect the average journalist to understand this.
Which takes me back to the “debate” between the then Minister of Finance, the UK educated Jacek Rostowski and the architect of the transformation of the Polish economy Leszek Balcerowicz. Whilst I had a lot of time for Balcerowicz back then he does rather underline a different approach to economics than that espoused by John Maynard Keynes. JMK famously when asked a question as to why he had changed his mind replied “I don’t know about you but when I notice that the world has changed I change my view of it”. Unfortunately Mr Balcerowicz has not noticed that the whole economic paradign has shifted since he last held power and that red in claw capitalism does not provide all the answers.
However the main point is that the debate, which concerned taking back a chunk of pension funding into the State run ZUS from complacent fund managers, completely missed the point. Which is that there is very little difference between a state scheme based on current taxes paying for current penions, a state funded scheme (i.e. the state invests pension contributions to generate future cash flow) and a private investment fund based pension system. In every case pensions will ONLY be capable of payment if the economy in the future generates sufficient value added to support non working pensioners. In the case of an unfunded state scheme by way of taxes extracted from the productive and in the case of funded schemes only if the investments generate income.
In the case of funded schemes investment can be made within the given economy and hence that economy has to perform in the future. Of course some of the economy specific risk can be spread by investing in other economies. Except that what is a constant is that under performing economies sooner or later face devaluation of their currency (unless shielded by the Euro and assuming this strange currency is still with us in the future) and certainly by a higher cost of government borrowing.
So the real debate is actually how to ensure long term economic wealth and not how pensions are funded. And therefore the choise on Sunday is quite clear. Who is the safer pair of hands? The UK electorate has already decided. The Polish electorate has “two stabs at the cherry”, this coming Sunday in the Presidential elections and in the autumnal parliamentary elections.
Last week Bronisław Komorowski the incumbent President of Poland facing a second round run off with the opposition “stand in” candidate was harangued by a young man asking him how his graduate sister (presumably with a degree in political studies) was supposed to survive on 2,000 PLN per month from her “non” job and how she was supposed to buy her own flat. Komorowski replied that she should: a) get a better paid job and b) take out a mortgage. This reminded me of the response by Norman Tebbit- Maggie Thatcher’s tame rotweiller advising a young man unable to get a job in a Northen town to “get on his bike” and head south. Well as it turns out years later the people heading to where there are jobs were Poles and other Central Europeans.
Actually the key message is that many people believe that governments can and indeed should create jobs. Well the reality is that they can’t. What they can do is destroy jobs. Only entrepreneurs create jobs. When I look at Poland I find that, apart from multinationals, there are a large number of businesses set up by enterprising young Americans, Spanish, Koreans and Vietnamese amongst others who came to Poland and who run succesfull companies. One example I like to quote is Coffee Heaven set up by a young (then) American – one Michael Ovidenko and a UK company brought to Poland by Tesco to set up in store bakeries. As it turned out Tesco pulled out of the idea and my firm put together Michael who had an idea and the UK company who saw potential. Money was raised on the UK AIM market and the rest is history. Now being destroyed by Costa Coffee but that is as they say another story.
Another success story is Allegro, set up by a Dutch citizen leaving e-bay as an also run.
I could cite many other examples including Solaris buses and Raben logistics. Look at major UK companies such as M&S set up by immigrants. What is the common thread? Probably hunger has a role but I guess mainly it is not being bound by local “received wisdom” and thinking outside the box.
Coming back to Poland there are a large number of issues. The key one being education (we don’t need no education – leave the kids alone to quote Pink Floyd). There is no doubt that the Polish system is strong on fact regurgititation. What is is not good at is team work and building social capital. Oh and the mania that you cannot leave school until you are 19 and that 50% plus have to go on to university. Why? Look at succesfull entrepreneurs: Steve Jobs, Alan Sugar, Richard Branson and Bill Gates amongst others. Couldn’t wait to quit main stream education.
So the key issue of the current Presidential elections and the up coming Parliamentary elections should be just what sort of education the government should use OUR money to fund. Not whether in vitro is a good or bad thing or whether the RC church should have a monopoly on ethical education in schools.
Tesco announced today a staggering loss for the last financial year. The loss includes a 3.8 billion GBP write down of property.
This begs a question. As far as I know the UK property market has recently improved.
Which begs the question as to whether Tesco valued its property portfolio on a true open market reflecting land prices and comparative rental values or on discounted future profit streams expected to be generated by the stores? If the latter then that valuation is actually a valuation by default of goodwill (trademark) which in accordance with economic theory allows the company to generate super profit over and above that generated by a no name competitor.
Now unless I am much mistaken you are not allowed to reflect either self generated goodwill or self generated brand value in the balance sheet. And only a significant fall in expectations for future profits could underly such a significant write down of property values. Or maybe Tesco are just admitting that no one will be interested in buying or renting their large hypermarkets should these need to be sold.
Which just goes to show the trap companies fall into assuming values will keep on rising.