News / PiS to impose blanket retail tax in Poland [291]

Often the problem is in your own backyard and reluctance of local council to help. Above all the Pole is looked down on and treated as untrustworthy by urzedniki. But of course a lot of the grants that the government has provided, courtesy of the EU, have been wasted as it wasnt properly policed by the urzedy

News / PiS to impose blanket retail tax in Poland [291]

Polonius3, a simple example. Look how Biedronka began in Poland. They started from the beginning, with low prices and goods of a reasonable standard. They destroyed local shopkeepers. Over time they built their reputation and lifted their prices. Ask the average Pole and he'll tell you Biedronka is Polish! Thats how theyve managed to engrave their way into Polish everyday life. The gap in the market could have been filled by anyone. Its always filled by the fastest most forward thinking entrepreneur and entrepreneurs are lacking in Poland. Often Poles dont want to take risks with money, although Id say they take risks in other walks of life, so its not a pure risk averse thing.

News / Why has the US dollar reached almost 3.99 zł in Poland? [56]

Sterling would be much higher if not for the EU referendum, so there's still a chance it will be unwound. I cant see it much below 5,70. In fact I will strongly consider making a purchase there. Last year saw large outflow from emerging markets this year will be no different so zloty should stay weak relative to others.

As for the markets we have touched stocks for a long time. There could be an opportunity presenting itself shortly but it depends on how the central banks approach the matter. As for Poland, last year we disposed of pretty much most of no yielding for profit assets and are sitting on cash. We still have yielding assets and are looking to add but politics makes one sit on the sidelines expecting a better price.

News / Why has the US dollar reached almost 3.99 zł in Poland? [56]

Stockmarkets across the globe are falling and that means people are exiting trades in Asia and CEE, places deemed higher risk. So you are seeing outflows from the currencies. This is aside from domestic policy in Poland. This always happens when stockmarkets in developed nations fall sharply - people move into the dollar and US treasuries as they are deemed safe. The dollar should stop in its tracks in the near future but the euro may move even higher against the zloty as that does focus a lot on domestic issues in Poland since its the most liquid of the zloty currency pairs.

News / Demonstrations in Poland in defence of democracy. [2554]

Banks are cutting interest rates paid on savings and increases margins on current and future loans. They are also increasing charges for running accounts.
VAT will never go away, but retail tax is now said to considered for businesses with a certain turnover and it will be paid monthly. We are supposed to get something concrete by the end of the week PIS have said.

News / Do you believe that western Europe (ie EU) won`t punish Poland if Poland try to go out of EU? [44]


InPolska, most Poles who are working and have a mortgage arent in a position to up sticks and leave for the UK. Generally its the workshy layabouts that are the ones moving to jump on the benefits system. If you stand outside any one of the Polish shops that have sprouted up in England it wont take long for a group of "silownia" loving bald men in cheap tracksuits to start shouting loudly at each other with every second word Ku*** or H**. These people are word apart from the Poles that settled after the war or came in the years following.

News / EU debate on Poland [23]


World didnt exist before 300 years ago ;)
Its a nice fairy tale for Poland to dictate terms to rest of the world. I get it, its escapism in a way for some people. Poland can offer its central eastern location and relative cheap labour and in return getting huge funding and a massive export market on favourable terms in the EU.

Polonia / Polonia outraged by EU interference [196]

I repeat a conscious decision. And so they are where they are.

Polonia / Polonia outraged by EU interference [196]


Corrupting how? Bribes? You have evidence of this? Of course you dont. But even so, lets go with your argument. To be corrupted you must allowed yourself to be corrupted. Again its a choice. Made by the Greeks.


There was massive foreign investment prior to the year of joining the EU. It in fact created a property bubble from which parts of Poland havent fully recovered. It did make a lot of local land and property owners rich if they managed to hold on through the early 00's, as well as many peasants and farmers that found buyers for their land which up til then wasnt worth a great deal.

Polonia / Polonia outraged by EU interference [196]

Again Greece wasnt held at gun point to join. Its a basic point you still fail to grasp. The rest after that is completely irrelevant because if Greece doesnt join, it doesnt suffer those consequences. That is life you pay for the consequences of your actions, intended or not.

As for Poland, I have just stated it can muddle along happily now as it is, there is no pressure to join in the next 5 years. They benefit from EU funding while enjoy a floating currency. Yes eventually a decision will be made, but for now there is nothing to gain for politicians to euro bash as nobody expects them to join in the near future anyway.

Polonia / Polonia outraged by EU interference [196]

Poland has to be seen to be saying the right things and making small steps to joining. It doesnt matter what the current government says, because their is always the next one. As long as its possible for Poland to join, it will muddle along in that way. The problem would come if any government tried to make permanent the zloty, constitution-wise, there would likely be consequences. But no sane government would try this since Poland is still a long way off ready to join so there is no threat to an anti euro government currently or near future.

Polonia / Polonia outraged by EU interference [196]


So much BS. Greeks came into the euro with hidden debts. The chose to hide their debts and met thus the entry criteria. Nobody forced them.

Oh and by the way, the Greeks have defaulted half a dozen times over the last couple of hundred years. Of course one can go further back to the original sceptic, Virgil "Timeo danaos et dona ferentes" I fear the Greeks even when they bear gifts.

Everyone, please focus on Poland

Polonia / Polonia outraged by EU interference [196]

If Greece had stayed out of the euro, it could have devalued and not had the problem. Debt was only a couple of points off 3%, a devaluation would have dealt with that. It was their own doing, own wishes to join the euro under false pretences. Nobody forced them. And of course the Greek attitude to work, pensions and reform meant they were never going to be in a position to pay off the bailouts, all of which could have been turned down at every juncture. Yes it would have been painful, but it is they that made the decision to join under false pretences, not the Germans. Just because someone benefits from an action, doesnt automatically mean they are responsible for that action.

News / Do you believe that western Europe (ie EU) won`t punish Poland if Poland try to go out of EU? [44]

For a start Szydlo has officially said she wont budge on Camerons insistence that new immigrants from EU have to wait 4 years before getting benefits. Entirely reasonable demand from the UK, requiring people put something into the system before getting paid out. But I digress. So its unlikely Cameron is going to be smiling in any photos with her as he is already getting bad press in the UK.

On the point of UK leaving the EU, the UK pays in more than it gets out from the EU while London is the financial capital of the world and this is largely down to geography/timezone. So it makes it a focal point for US EU and Asian banking, so you are going to have to do business with London whether EU or no EU for the UK (not saying any transition wont be bumpy). Poland on the other hand doesnt have such a strong hand, its still developing

Polonia / Polonia outraged by EU interference [196]

As I said, the Germans gained from accepting peripheral nations. They had so much more to gain or at least so they thought at the time. They will have had an idea about the debt disappearing, but they were not at fault for the deceit. That was all the Greeks and of course with a helping hand from Goldman.

Its like a bar owner telling his staff to check ID's and not serve anyone under 18. The guy may or may not be 18, but has the correct ID, so gets served and bar sells a few beers. But if that someone gets bladdered and has to have their stomach pumped, whose fault is it really?

Polonia / Polonia outraged by EU interference [196]

The Germans were not privy to any underhand actions by Greece but as I say it was in their interests to get onboard as many peripheral nations as possible. The Goldman swaps didnt come to light much later, some time after 2008 when nations were ordered to restate their accounts as such transactions were banned.

Polonia / Polonia outraged by EU interference [196]

Greece hired Goldman Sachs to lets say diplomatically paper over debt in order to meet the criteria to join the euro. And with the average Greeks approach to work and taxes, they probably deserved the EU's stance towards them. Greece never should have been allowed to join the euro, but then it did suit the Germans to have as many soft nations on board as possible. Still the fact remains the Greeks hid their debts and it came back to bite them.

News / Do you believe that western Europe (ie EU) won`t punish Poland if Poland try to go out of EU? [44]


All starts and finishes with money. Monies paid by the EU to Poland will at some level have to be reimbursed prior to leaving. They wont be able to agree on this. So its a non starter. If Poland walks away on its own terms it will be hit with sanctions and shakes hands with Ukraine. Its simply suicidal and there are no benefits for Poland in this.

News / Do you believe that western Europe (ie EU) won`t punish Poland if Poland try to go out of EU? [44]

Sorry a change in constitution requires 2/3 of parliament voting for it, something that will be required to join the euro. Prior to that, talk was that the people of Poland who need to vote on it via a referendum and then it would go to parliament if the referendum achieved a 75% vote. This second part was just discussion but the first part is set in stone. And I presume leaving EU would demand similar approach.

News / Do you believe that western Europe (ie EU) won`t punish Poland if Poland try to go out of EU? [44]

There is no mandate for any member leaving either the euro or the EU. In Polands case accepting the euro would require a change in the constitution and 75% referendum vote (its highly unlikely that 75% of voting Poles would vote for such). Id suggest similar would be required to allow the government at the time to address the situation in Brussels. But even so, there is nothing in the EU framework to cover this. There is also the financial aspect to consider and neither side would be able to agree on numbers. A pipe dream for communists nothing more.

Polonia / Polonia outraged by EU interference [196]

Its nothing to do with the EU! S&P is warning of a repeat of what happened in Hungary if events continue on the same path as the government is currently pursuing. If you held onto to Hungarian bonds at that time you would have been marked down a lot of money! More so all ratings agencies want to look whiter than white and on the ball more than ever.

Polonia / Polonia outraged by EU interference [196]

This is the last part of the report:

OUTLOOK

The negative outlook reflects our view that there is at least a one-in-three possibility that we could lower our ratings on Poland in the next 24 months.

We could lower the ratings if we perceived a further weakening in the independence, credibility, and effectiveness of key institutions, most importantly the NBP. In addition, we could lower the ratings if public finances deteriorated beyond our current baseline scenario as the revenue and expenditure balance becomes more negative.

On the other hand, a reversal of the government's efforts to change and control Poland's key institutions, as well as sustained strong external performance, leading to further reductions in net external debt could lead us to revise the outlook to stable.

So its clear S&P is quite willing to change its decision or upgrade its rating if it believes present instabilities are not added to or corrected. The argument for them is that the events that have taken place bear a similar resemblance to what took place in Hungary before its debt crisis. Thats what triggered the crisis in Hungary. There bonds yields doubled to over 12%, a huge move, at the height of the crisis but since that Orban have toned done the rhetoric and returned to promoting growth and increasing FDI. Now bonds yields are only a little above the levels of Poland.

Polonia / Polonia outraged by EU interference [196]


Its is because of these failures that the agencies are taking notice of political change rather than simply economic, the ft ran a piece on this in relation to the poland downgrade.

Ratings agencies specialise in risk. And the risks for making investments in Poland is higher. If the risk of not getting your money back increases, you demand a higher return, hence Polish bond yields have gone up. Investors have voted with their feet. They dont feel as secure as sometime ago. We all remember the Hungarian debt crisis a few years ago.

Polonia / Polonia outraged by EU interference [196]


Fitch affirmed Poland's Long-term foreign and local currency Issuer Default Ratings at 'A-' and 'A', respectively, with stable outlooks (outlooks lower than that of S&Ps at the time)

The agency noted that the stable outlook reflected the assessment that upside and downside risks to the rating are currently balanced. That said, Fitch warned that any relaxation of the fiscal stance that worsens the government debt trajectory and weakening of policy credibility or economic performance, could trigger a negative rating action.


The EUR/PLN rate is much more relevant since the majority of business is with the EU and this touched a multi year high of 4.50. The dollar rate itself is at a multiyear high and means the country benefits less from falling oil prices.

For those interested, the summary from S&P:

"The downgrade reflects our view that Poland's system of institutional checks and balances has been eroded significantly as the independence and effectiveness of key institutions, such as the constitutional court and public broadcasting, is being weakened by various legislative measures initiated since the October 2015 election," S&P said. "In our view, these measures erode the strength of Poland's institutions and go beyond what we had anticipated regarding policy changes from the general election," the agency added. The rating outlook was also lowered to 'negative' from 'positive', suggesting at least a one-in-three likelihood that the ratings could be lowered within the next 24 months, if monetary policy credibility is undermined or if public finances deteriorate beyond S&P's current expectations. Further, S&P no longer expect Poland's fiscal metrics to improve, but foresee some reversals in Poland's sound macroeconomic management of the past years, for instance by targeting certain sectors with new taxes. The agency also raised the fiscal deficit forecast for 2016 to 3.2 percent of GDP, saying that various spending-side measures, either planned or announced, are not fully offset by revenue-side measures or expenditure cuts.

Its important to note that S&P did add at the end that they could upgrade their rating if the situation changes for the better with less government interference.

Polonia / Polonia outraged by EU interference [196]

After the post crisis years the deficit has been coming down slowly to around the 3% target. Lets see what happens over the next few years.

The level of intelligence on this forum is truely shocking, but this is nothing compared to the blinkered outdated and thoroughly incorrect views of a number of individuals.

Polonia / Polonia outraged by EU interference [196]

After the downgrade the finance minister came out and said Polish economy is in good shape with strong funadamentals when only a few weeks ago the "audit" suggested that the previous govermnet had left Poland in terrible shape. So which is it?

Law / Poland's Zloty 43% undervalued [30]

Before the new govrnment EUR/PLN was in a range 4.0-4.35 roughly. You could happily trade that or make deals based on that. Now its pushing towards 4.50 and weve yet to see bond investors depart, so its possible we see towards 4.7/4.75. Id be surprised if it moves above 5 as Id expect most to see through the 4 years of this government and start to put money to work at some cheap levels. Property in Poland is quite depressed on an international level, although many Poles still struggle to get a mortgage.

News / Do you believe that western Europe (ie EU) won`t punish Poland if Poland try to go out of EU? [44]

When the EU was drawn up there were no set rules for a member leaving the union. They are not going to kick anyone out or let them leave as it will set a precedent. In fact Poland has agreed to join the euro but it has signed to an exact date, this was the condition on joining the EU. Because the UK joined much earlier and was seen as a more important partner, Thatcher was able to avoid the euro clause and also managed to get a right to veto. Poland was late joining so wasnt able to make demands.

Russian and Ukraine exports have fallen throught the floor for Poland given sanctions and war, so its much more dependant on Europe and in particular Germany, a fair bit of manufacturing produce goes over there and it needs a strong Germany to keep that up.

News / Poland's post-election political scene [4080]

The Polish saying "jak ktos cos daje to trzeba brac" makes sense here. While EU money is avaliable it should be taken with open arms. The EU provides many grants for Poland to help the unemployed and young businesses, but this money is often squandered by those people as its not an area oroperly policed by the relevant authorities. Money is also on offer to redevelopment underpriveleged regions and countryside. This has to be used effectively but unforunately a portion of this is funneled off into pockets of people with hands on the money.

News / Demonstrations in Poland in defence of democracy. [2554]

2005-2008 was the boom period after Poland joined the EU. Money and investment were flooding in and driving growth. The years that followed saw huge contractions in world growth and recessions almost everywhere but not in Poland. You could say PO kept Poland out of recession or you could say the EU money which was flowing in to projects such as infrastructure helped to avoid GDP contraction and instead make Poland the only country in the EU to avoid recession (building roads and bridges counts to GDP). This more than anything underlines the importance of EU funding and why Poland needs to maintain this flow as much as possible. What happens in Poland is largely influenced by what is happening in the global economy. When there is concern, people reduce exposure to riskier investments such as Poland. There is nothing that can be done about that apart from striving to be more integrated economically with Europe and thus reducing the countrys risk rating.