Poland and Polish Discussion Group and Forum

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Poland and Polish Discussion Group and Forum
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Government must tackle public debt

03.08.2009


Poland’s national debt has reached 55 percent of the country’s GDP, causing, what the daily Gazeta Wyborcza calls, a ‘chain reaction’: the Polish is weak, servicing foreign debt has become debilitating and debt rises, as a result.



Polish politicians have already created a potential plan to combat the increasing deficit: the Public Finance Act from 1998 and amended in 2005, mandates that the government take on the issue of decreasing national debt if it reaches 50 percent of the GDP by cutting the state budget.



However, the Polish government is severely limited in what can be done to combat public debt considering that it has little control over the budgets of public institutions such as the Social Insurance Institution (ZUS), the Agricultural Social Insurance Fund (KRUS), the National Health Fund (NFZ) or those of local governments. Furthermore, the government learns about the debt of most institutions when it is already too late to prevent deficit.



The Act also makes it difficult for analysts to access official information considering that the Minister of Finance is only mandated to release a report on public debt by the end of May. Analysts expect that, in June 2010, Poland will be confronted with an overwhelming public deficit. The country’s presidential campaign begins at that same time, and the topic of public debt will likely be the most important campaign issue. The ruling Civic Platform could face serious problems if it appears that they have done little or nothing to combat public debt. Current Prime Minister Donald Tusk, of the Civic Platform party, is expected to run for president. (mmj/ps)


It seems Poles are developing bad habits from its US friends.. Now is the time to invest in bank shares etc

Re: Government must tackle public debt

Wait till the crisis - watch the zloty lose value against the dollar as fear rules the market - watch fighting in the streets as the govt is forced to stop funding state-owned industries - watch the misery in the villages as commodity prices nosedive just at the time subsidies are removed - watch the property developers suspend all operations or simply go bust.

Sell all shares!

Re: Government must tackle public debt

Mr Varsovian, this article is for you,

http://matterhornassetmanagement.com/newsletter/?newsletter=20

Happy reading

Re: Government must tackle public debt

It seems that buying gold is the best investment..

hmmm time will tell

Re: Government must tackle public debt

I think short term the dollar will go up, but this whole bubble - growing for 30 years now - will compare with the South Sea Bubble of 1720 and will dwarf the Great Depression of the 1930s. Yes, gold is one answer, but not just yet. Hyperinflation? I think deflation is more likely actually. Look up Elliott Wave ...