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


Nonsense. No one is more in the hands of bankers than the Americans. They have taken trillions off the state and control every industry as those who hold the debt control the outcome.

The world is as it is, if you have no money you need someone to back you. If your idea is not deemed commercially viable then you are stuck. Idealism is nice but money makes the world go around.

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

China hasnt managed that but of course peddling falsities and propaganda is what dictatorships and communism is about.
Chinas growth has been artificially controlled by the rulers and now its blowing up in their face and will likely drag the rest of the global economy down with it.

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


I dont think youll find my foreigners at such demos. Unless maybe teachers or students.
As for plotting to destabilise Poland, I think even Szydlo said that people had a right to demonstrate as it shows democracy is in place. In any case, the government has started to destabilise the country all by itself. These days money talks and if you are taking you have to walk the line, at least officially if not privately.

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

Liberarius, the UK US and Europe have undertaken in QE programs over the past few years to the tune of a few trillions to try to prop up the economy by keeping interest rates ultra low to allow people to borrow invest and expand, without fear of interest rates going up too soon in the future. Essentially the banks got to borrow very cheaply and were supposed to lend this money to those that needed/wanted to borrow. Of course much of this money got leveraged and invested in the financial markets and created bubbles in some areas. The problem faced now as interest rates have started to rise in the US is will those huge leveraged positions bring down the banks again. Since 2008 the too big too fail argument isnt as apparent today, but there will be a lot of pain in some areas of the financial community.

QE was probably the biggest transfer of assets from the taxpayers to the financial industry ever, but its easy to call it a failure now. But you just dont know what could have happened if QE didnt take place. Back when banks were failing everywhere and peoples savings were at risk, the governments had no choice but to bail them out and flood the system with money to try to improve confidence. Apart from giving every citizen a cheque for a thousand dollars, theres not much that could have been done. These days there are more safe guards in place and bigger walls separating investment banking and retail banking, so that area (peoples deposits) should avoid significant problems, but certain industries with highly leverage debt are going to see particular pain if the worst comes to the worst.

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

Most banks didnt charge very much for running accounts, nor ATM fees, until the new government started to threaten bank taxes.
Polonius3 I am interested on your view on Dudas announcement or friday regarding the bailing out of swiss franc loan homeowners who are generally regarded as being better off than the average zloty based loan home owner. I fail to see how they are helping out the average Pole here as it seems they are doing the opposite, as people with zloty based loans and who paid a much higher rate of interest of the so far duration of their loans are getting no help at all and in fact, by the higher margins to be introduced by banks, will be subsidising the swiss franc loan home owners.

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

Some banks have already increased charges and by february will be increasing margins on new and current mortgages. It might means only a 50zl/m increase for most people but it will add 5% to the value of the loan over its life.

As for financing costs, for every 1% move in bond yields it costs 1,000,000zl more in interest on every 1 billion in bonds outstanding. When you consider there are hundreds of billions outstanding, it amounts to a lot. Money that this free spending government cant afford to lose. The bond market has really reacted yet in such a drastic manner, but it has decoupled from germany bonds since october and has been underperforming hungarian bonds (often seen as the anti europe side to CEE). Here is a chart below showing the last 5 months.

stooq.pl/q/?s=10ply.b&d=20160115&c=5m&t=l&a=ln&b=0&r=10huy.b+10dey.b

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

Long term the companies stay and start paying tax (outsourcing isn't a for profit system. They pay wages and make no money to pay tax on).

This is clearly seen in cities/towns that opertare under a stref ekonomiczna, a tax break offered to encourage companies to build factories/warehouses in their region. It provides local work for locals and the companies get favourable conditions to outsource. For towns where there had been nothing going on for years and couldnt compete with the bigger cities, it was a clear shot in the arm. Even if just 3 or 4 companies locate to such a town it means 2 or 3 thousand jobs in a city of 50,000 and that makes a big difference as those wages tend to be spend in the said town.

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


well GBP/PLN reached a technical resistance a little above 6 right at the time the markets started to worry about the UK leaving the EU. The vote has to take place by the end of 2017 and currently the market believes it will take place early/late summer this year, so various hedging has taken place by companies not wanting to be exposed to the risk of a fall the the pound. Otherwise the exchange rate would be at highs like euro and dollar vs the zloty. If things continue in the current vein, we could see towards 5 zloty against the euro. The dollar might have problems of its own later in the year but still likely to stay above 4 zloty.

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

Polonius3 you all wanted solidarnosc as opposed to communism, else it wouldnt have happened. And that meant greater ties with Europe. Nobody forced you into it, you made the play yourselves.

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

The downside of the ratings cut is that the government bonds will go down and that means the yield they pay investors on money lent to them goes up. PIS is wanting to spend money left right and centre and has already said the budget will be squeezed. Todays news will see more money go from the budget to pay the higher yields on the bonds. About 40% of government bonds are foreign owned so there is likely to be a big move next week as not everyone will have acted on the rumours.

A weaker zloty makes good news for exporters bad for importers thats clear, but it will mean no more falls in price of petrol as thats price in dollars and when oil rebounds then petrol prices will rise faster if zloty stays where it is or weakens further.

But the good news is the EU donations Poland gets are sent in euros so they will be worth more!

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

Tax will be official next week they said. They had ten days which makes it a thursday or friday I believe. They had moved away from 250m2 to turnover but until it happens you never know. The swiss franc deal will see banks have to cough up on average about 1 point move on every loan on their books. So for arguments sake its about 4 now, so they will have to move to 3. Thats on average, some will be less some more. But those banks apparently get a 20% discount on bank tax.

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

Doesnt matter what the other 2 agencies as Polish bonds will get clobbered next week. It was sort of known earlier in the week but until confirmed bonds were ok given global stockmarkets were off. Long hungarian short polish is probably a good idea for the year as Hungary has already does it PIS with Orban while Poland is yet to enjoy the "fruits" of the new government ;)

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

Well S&P have just downgraded the zloty to BBB+ and placed the countrys sovereign rating on a negative outlook (from positive). Yes new government blamed.

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

Without foreign investment Poland doesnt exist. Do you understand pension deficit is 250% of GDP. All those huge zus's over the years squandered. Thats what every government should be tackling. ZUS and pension deficit. If they want to do some taxing make the companies assign a larger portion of pay to pensions pot. Its a big step but less controversial than making banks energy companies and just about everyone pay for a coal mining industry that should be closed down.

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

Price controls? Seems like communism to me. At best he is an idealist with zero understanding of how businesses operate.

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


China is moving from a manufacturing export based economy to an internally driven consumer and service based economy. The last decade they have bought vast quantities of raw materials with which to build cities for the their people. They financed this by selling cheap products to the rest of the world. Now that they are done building, they are going to grow internally. It will take time, but thats their goal. So if you want a railway to China, you are going to have to build it yourself.

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


The bank tax even though not officially sworn in is already seeing a blanket increase in baking charges and of course loan repayment margins. The retail sales tax (was to be supermarket tax but now will include almost anything being sold to individuals, full details next week) is going to have a similar effect - higher prices. That in itself gives a one off boost to inflation but doesnt help the lower income class that they are supposedly defending. Tomorrow morning we will get details on the swiss franc loan conversion scheme. Again all savers and loan holders will be made to subsidise poor decisions made by those who took out swiss franc loans. The best you can say is they mean well but dont have a good idea about how to make real improvements that their manifesto pointed to.

Polonia / Polonia outraged by EU interference [196]

Wages are paid according to demand, its that simple. Nobody setting up in a foreign country says ok we are going to pay a third of what we pay locally back home. You pay the going rate plus some if you are new and want to attract the best talent avaliable. If you start losing people you will pay a little more. No business from the developed West is going to pay more than it has to. But Polish businesses are just the same, they pay the minimum (if they do pay or on time at all that is).

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


Ultimately the guy at the top is responsible for the companys bottom line. If profits are increased, he deserves an increase. If we are talking even just ten of millions increases, you have to reward him with a substantial increase or he will leave and work for the competition. Then you have the double whammy of having to choose a new CEO who is an unknown quantity (he may have sector experience but youve just seen your highly successful CEO leave, so relatively speaking its unknown) while your previous CEO who you didnt want to reward has gone to the competition and is likely to improve them which will eat into your profits next year.

Polonia / Polonia outraged by EU interference [196]

Its not governments hamstrung by Brussels its often corruption and a desire to line ones pockets that supresses a lot of local goverments. I had this real experience in a town in Poland. There was a large amount of real estate and now unused office and manufacturing buildings. The town had chosen some years ago to put it up for sale but for years no one was interested. One big problem in Poland is council/business tax on property which is the about the same in Warsaw as it is in the poorest town you can find. This in itself is a major minus for investing anywhere outside the biggest cities. But I digress. I spoke to the councillors and suggest that instead of having a multi million asking price, they could offer the land and buildings for 10% of the asking price and a big reduction in business tax for a number of years, to any investor that signed a contract binding them to redevelop the buildings and employ at least 50% of their workforce from locals living in the town backdated 2 years. Those working people would plough much of their earnings back into the local economy, helping local businesses. Of course to the investor its appeals as it gets favourable conditions to encourage them to invest outside of the top 10 cities.

Discussions got nowhere and later I was told unofficially by those in the know that they will never agree to such a scheme as the lower the asking price the smaller the backhander involved to those massaging the deal. So basically down to the greed of a dozen or so people, a few hundred people didnt get to work and the town suffered.

Polonia / Polonia outraged by EU interference [196]



With such established competition, the main barrier to entry is huge investment. But it is possible if you have a business model that has a chance of working. In the UK Tesco and the rest of the big four used to make multi billions each year, but Aldi and Lidl entered the market with their discount model and have not only dented the established companies, but have caused massive collapses in the financial health of these businesses. But these were hugely successful businesses in Germany and they had the cash to investment in bringing their model to the UK.


Yes what Hungary did the last few years seem to be a copy sheet for PIS. Hungary was very anti business but have calmed down recently and actually is very likely to outperform Poland as far as investment flows are concerned this year. Hungarian investments have got quite beaten up so they are appealing for those worried about what the government is doing in Poland.

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

ANother comment with subzero foundation. We dont employ anyone directly. And we will be paying largely the same taxes as before.

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


PIS has already lost the next election, they just dont know it yet.

Polonia / Polonia outraged by EU interference [196]


No foreign corporate force any Pole to buy something they did not want. One of the first entrants was Biedronka, probably the most favoured supermarket amongst the lower middle class. Most of them wouldnt shop at any other store under gunpoint even. Why do they shop there? Because it offered cheaper prices than local private shops and produce whose quality was at a certain level. So it gained the trust of the population. And yes its Portuguese owned, so the profits get sent back home. But its the same for any company investing in a foreign land. They operate to make a pofit and remit profits back home. Biedronka and co isnt successful becuase the Poles were tricked. Nobody in Poland had the funding or the capability (i wont say inteligence) to roll out such business. And that leads onto my next point. The majority of Poles have very little savings and are cautious by nature (no entrepreneurial nature on the whole), so even if foreigners left overnight, they would be unable to fill the gap. As most developing nations, Poland needs foreign investment to expand and in return this investment also creates jobs and better conditions as well as access to things people only dreamt about 2 decades ago. So expecting Poland to turf everyone out and do everything for themselves is entirely impossible. The only way they could fund such activity is by printing money by that would create hyper inflation and bankcrupt the country. They in fact did this when under communism and theState bankrolled all business, but of course then we had the one million zloty note and people queued all days for bananas. And the only people who want to return to those times where everyone was the same are those with no ambition to better themselves.

Polonia / Polonia outraged by EU interference [196]

Its the local commies that got the properties for zip or close to. They got to sell them for zero tax as that was the law for props pre 2007.

Real Estate / Building a house in Poland need advice from anyone that has built [100]

Yes a lot of the time when Poles hear "foreigner" then they double the price. They will then ring back and reduce it when you tell them you are hiring the competition. Most of these small builders live from one job to the next, so you can always negotiate a good price. Just dont pay in advance unless relationships are long and well cemented. Oh and watch for alcohol on the building site, its the most important element!

Genealogy / Polish blood only makes up 1% of your "Polishness" [77]

Haha, no. Weve have dealing with them many times over the years, but thats their job. As long as you stick to the rules and pay your dues, you arent going to have a problem with them.

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

People were queuing for fresh fruit all day. The country has come a long way very quickly. You have to expect bumps along the way. Being poor with no future and staying poor with no future is now more of an option than before. Still a long way off Wedtern developed standards but that is to be expected for a story of expansion that really only started since the fall of communism. Just have to be careful not to isolate those that pull the strings. Poland is very good at working the EU system, it should continue to do so and do what is asked (usually within reason) or they will turn off the taps as they did for Greece.

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

Many developed countries have problems getting fair taxes from global giants. Its a compromise and something thats done over time. But while companies are making money in Poland they wont want to leave and thats the key to negotiations. Capitalism isnt perfect but its better than other realistic options. Poland has a huge pension deficit and and Poles little savings, so huge internal investment is impossible.

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

Poland needs external investment to reach its goals of growth and expansion of wealth for Poles as a whole. Some will be left behind but the alternative where everyone has and is equal, is communism and that only works when the world doesnt keep tabs on the treasury's bottom line - something that was possible in the 70's/80's but not in this age.

With the EU you know where you stand. You toe the line, you get the cash - EU does as it says it will. There has been a huge increase in foreign ownership of Polish goverment bonds. This is a sign of trust in the approach Poland has taken over the last few years. Causing arguments and backing away from the EU will see this investment reverse and neither Russia nor China will pick up the tab as they have problems of their own and of course have a less ethical approach to foreign investment.