Friday, November 30, 2012

Some LIES about the Philippines’ 7.1% Q3 2012 GDP growth

Want to contribute to the economy? Eat this!

1. Noynoy did it!
Whatever growth or positive economic outcomes occurred has nothing to do with the administration’s policies. 
They’d like to portray it as a matter of instilling confidence in investors via some anti-corruption program, which does nothing to remove corruption as much as it simply eliminates political enemies.
Besides, all the inflows and increased activity are indicative not of growth but of a bubble brewing thanks to easy credit here and abroad. And bubbles inevitably pop, with no increase in the general well-being of a people.

2. Growth is consumption-led
Since when has draining your wallet made you feel richer?!
Granted, consumption levels may indicate the prosperity occurring in a country, but only in as much as income levels increase previously, by which the consumption can be afforded.
And such income often comes from abroad, wherein such foreign trade, including BPO companies and OFWs, has nothing to do with government policy except to the degree government stays out of the picture.

3. GDP is a reliable indicator
The GDP formula is composed of consumption + investment + government spending. This aggregate means nothing in itself. The degree of consumption and of government spending does not indicate sustainability of such. And investment is only as good as it comes from savings and it reflects actual preferences, which again has nothing to do with government policy except to the degree government stays out of the picture.

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Don’t believe what you hear about the economy taking off. It’s a bubble.

State-guided growth is a bullshit concept, and the illusion of such can only come about via savings-less loose money, the bubbles of which don’t last and wreak havoc in the long term.

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