Romania 2010: Do we really wantto reach bottom and stop falling?

Part 2

to read Part 1 please press here

      During the last 40 days I have been presenting parts of my prediction for the year to come in many interviews or panels I participated. While stating my opinion, I received the feedback of tens of people, who agreed or disagreed with what I think. Meanwhile the world economic crisis prepares to enter in a new phase, with different characteristics than the previous two phases we all lived during the last 15 months. After the sudden collapse and the continuous drop, we enter now to the fragile stability with some drops of recovery. But these are for the rest of the world, not Romania…
      So, let me share with you what I expect to happen in Romania during 2010…

Part 2: Upside down in just 12 months time… 

From GDP growth +8,9% and 1 euro = 3,4 ron…
      It was just 12 months ago. November 2008. We received the official information about the GDP growth of +8,9% in the first 9 months of the year, while ron was quite strong, maintaining a currency of 1 euro = 3,4 ron. August 2007 was not so far away, when ron reached the levels of 1 euro = 3,08 ron, becoming the only currency in the world which was so much appreciated against euro. People were consuming a lot, creating continuous records from one trimester to another, from one year to another…
      Salaries were up in the sky, unemployment was around 0 in big cities, Real Estate prices were much more expensive than Germany and other countries. The world crisis had started, the new measures of BNR had frozen the residential loans based on a fake salary (the most popular trend back then, if you remember…) but very few seemed to care. I was telling to people that the market will continue falling until 2010, but it was “sweeter” for them to believe “market analysts” and politicians who were predicting that “the crisis will end in 2 months” or “after the elections” or when Santa Claus would bring the Christmas presents. As if people were hypnotized, reaching the level when they try to ignore the truth as much as possible, searching for any promise (by anyone) to rely on.

…to GDP deduction -7,5% and 1 euro = 4,3 ron
      Let us be honest, now we are sure. How did Romania fight the crisis during 2009? By trying to convince its people that the crisis does not exist (in the beginning), then with big fights between the politicians and after with the hope that the crisis will end soon. Anyone who changed behavior? Not really… from its leaders to its citizens, the country started going down, while most of the people pretended that this does not happen. There were also many hundreds of thousands (in the beginning), millions (now) who felt the results of recession and complained (but continued searching for solutions following the old technics, decided to remain the same in a different world). A minority of healthy thinkers got more upset, but this minority of Romanians is not enough so as to become the leading one. (At least I am happy it increases fast…)
      Things turned upside down very fast… The unemployment rate has been doubled in the last 18 months, the salaries are cut off, consumption shrinked, loans are blocked, Real Estate prices fell by more than 30 – 80%(depends on each category), the loans of the country almost doubled in just one year (still among the lowest levels in E.U.) European funds were not absorbed, as the ones in charge are too busy fighting in between.
      So, who could stop the free fall? As always, the Governor of BNR, Mr Isarescu. I am positive that without him things would have been even worse. Not that they are good now. Fighting daily with the markets, he maintained a stability at the exchange rate at the levels of 1 euro = 4,3 ron. For how long though? This costs to the country’s national reserves 1.000.000.0000 euro per month (or more). In the same time, a policy like this should be backed up by political decisions and stability, solutions, support by the public. No… most of people are too busy reading for the drivers of Monica Columbeanu and the ladies who entertained Adrian Mutu, at the night before Romania lost to Serbia with 5-0. They blame the state and politicians, everyone, while they continue searching only for “clever business” and “smecherie”.
      Did you see many people who work in shops becoming more polite to you, as client? Did you understand that they try more, so as to make you consume, so as to please you as customer, increase the sales of their shop and keep their jobs?

(tomorrow: The “Romanian plane” is falling, while its pilots, crew and passengers enjoy the view)