Sunday, 27 November 2011

The last bike ride this autumn and the first snow (?) this winter (?)

I rightly presumed the first weekend of November was the last opportunity to enjoy warmth this autumn. On Saturday, 5 November day-time high topped almost +15C, while on Sunday it hit less than +10C, but only then I found time to take my bike out of the garage and set off for the last, short trip this autumn. I covered less than ten kilometres, yet the trip brought about many thoughts. To the right – a commuter Radom-bound, almost empty train. How long since I last travelled by train? Didn’t I get too used to carrying my arse in a car? And who the hell cut down on number of Warsaw-bound trains in the morning in the new timetable, effective from 11 December?

I cycled along the tracks towards Jeziorki up a dirt track that according to some maps is a street. Burrows and traces of tyres indicate some desperate drivers might have ventures here, but these were probably only local farmers in their tractors, on their way to plough their fields. How long before a civilised road is built here? Which expressways and motorways scheduled to be opened before Euro 2012 will indeed be opened? Would it be possible to finish the construction of S2/S79 roads before next winter? Will the southern bypass of Warsaw be completed by 2020. Will we have decent roads out of capital by the end of decade? Will the construction of S7 expressway linking Warsaw with Kraków be put back by more than two years?

Fallen leaves rustle beneath the wheels. Instead of cycling at the side of actual road, I decide to ride on the bumpy roadside. This option is safer for me and for drivers. Why so many people, totally unaware of traffic regulations and dangers they might cause, often physically incapable of cycling on a busy road, get on their bikes and ride? Why so many do not have front, nor rear lights on their bicycles? Why so many do not have any flashy stripes on their clothing? Why must there be so many accident involving cyclists and pedestrians in the period of year when days are shorter?

The riot of colours on the trees. Trees have shed their leaves quite late this year, as September and first days of October were very warm. Then the weather has taken a turn for worse and warmth has become a scarce commodity. What will the coming winter be like? Prophets of doom would predict the harshest winter in this millennium (incidentally the third in a row), but early attack of snows and frosts in November has not been brought off for some reason…

Lukoil (Russian brand, watch out, invaders coming over!) petrol station. Unleaded 95 petrol cost three weeks ago 5.20 PLN. Last Sunday I was lucky to fill up my car for 5.28 PLN per litre. How long before high fuel prices begin to be a drag on Polish economy. Remember February 2009. USD/PLN rate hit then 3.90, but price of crude oil hovered between 30 and 40 USD per barrel. Petrol cost then some 3.20 PLN per litre. Now USD/PLN is some 0.50 PLN short of reaching the same rate and amid the current turmoil it is conceivable to that it even hits 4.00, but prices of crude oil remain absurdly high. If you assume costs of commodity makes up half of petrol retail price, it means that if USD/PLN rate is the same as in early 2009 and crude oil price in USD is three times higher, retail price of petrol should reach some 6.40 PLN. Imagine this… No room for interest rate cuts, inflation pressure may even send them rising and increase cost of borrowing. We have the nail to the coffin, now where’s the hammer?

I don’t even know if I can sincerely say we’ve had the first snow this winter, but just for the record some photos taken on Thursday, 17 November. Temperature in the morning ten days ago dropped to –4C, air was humid and as a result I beheld a considerably thick layer of hoar-frost on my car (to the right – a good examples of the bogey that winds up drivers who don’t keep their vehicles in garages). I left earlier to bring the car to a roadworthy condition. Instead of some ten minutes, the whole operation took my car and me only three minutes (I scraped the ice off side windows, while the car defrosted its windscreen, rear screen and side mirrors – accolades to the wise scientist who invented defrosting devices).

Traffic on ul. Puławska was quite sparse (I noticed on colder mornings number of old, rickety cars is lower), so I reached P&R Wilanowska much earlier and decide to walk from Metro Centrum to my office - mere 3 kilometres on a brisk, frosty morning give a decent dose of oxygen for the brain. As I walked out of the underground station it seemed to me the world looked a but whiter. As I sauntered some three hundred metres west, surfaces of all objects looked much whiter and it didn’t look like hoar frost, hard rime or ice.

As I wandered on west, the layer of white powder was more and more visible and… treacherously slippery. To the right – around five millimetres of flurry or something like this on what used to be ul. Prosta and now is the construction site of second underground line. Later I read on TVN Meteo this kind of precipitation is called snow grains. Whatever it was, it disappeared by midday and I don’t call it first snow in winter 2011/2012. It was observed only in some parts of Warsaw (my parents told me nothing had fallen in the southern suburbs) and had this happened on Saturday or Sunday, these photos would not be put up here.

Believe it or not, I don’t wait for the snows, sub-zero temperatures, or any other signs of winter. Currently North Atlantic Oscillation is very active and draws in warm air and rainfalls from the west. Upsides – high temperatures (today at 19:00 weather station on Warsaw airport reports +8C!) and no risk of snow. Downsides – gales and risk of havoc wreaked by gusty wind, plus low air pressure. Despite the downsides, I’m glad we have this kind of weather, may it stay like this possibly long. Current long-term forecasts show no intimations of winter on the horizon, really bothersome winter is unlikely to come before Christmas. Good news, given that I’m still in for two business trips in the first half of December. Chaos caused by attack of winter and inability of Poles to tackle it when it hits for the first time in a season, wouldn’t rather make the journey enjoyable.

But frosty mornings, despite nuisances, have their charm – to the right – construction site of Rondo Daszynskiego underground station, in the distance, skyline of Warsaw with its new element – Złota 44 skyscraper and two cranes surrounding it. Snapped on 23 November, the coldest morning this autumn (-6C).

Sunday, 20 November 2011

The power of one man’s word

This blog, just like many other in the blogosphere, seems to have seen better days. Once in a blue moon I happen to post more than once a week. Writing on the spur of the moment (usual method of running PES) is now the thing of the past; these days over the whole busy week I try to plan what to write, then change my mind, when I get down to writing.

I was going to give a coverage of my last bike trip this year and upload photos of first snow (actually I am told those were snow grains, not the proper snow) in Warsaw this year, but there is no such word as ‘weather’ in the title of the blog, hence politics from the time to time has to come into the foreground…

Friday saw the second inaugural address of prime minister Donald Tusk, who will go down in history as the first head of government to have stayed on for the second term in office. Unlike his speech four years ago, this one was not filled with visions of land of milk and honey. This time the speech, apart from leaving out many realms such as foreign relations, culture, education and health service, focused on painful economic reforms this government is going to press ahead, to at least try to turn around the Poland’s public finances.

The inaugural address went down astonishingly well with my friends, colleagues at work and my family (truth be told with my parents, as the rest of them, both at my mother’s and my father’s side vote for PiS and worship the would-be saviour JarKacz). Short, yet up-to-the point, with quite specific promises and time frame set for achieving the goals, makes it easier for voters and opposition to bring Mr Tusk for going back on his promises. I have no idea how many of them will be brought off, how many will lead to social unrest and for how many resistance of matter will be insurmountable. I do not find myself capable of assessing whether bitter promises of retrenchments and curbing public debt were just hollow words, but the speech of the prime minister did not smack of ‘mercenary PR’, so characteristic for PO and its leader.

This time Mr Tusk made us come back to earth and face the bitter truth. As a nation we have not lived beyond our means to such extent as many other did, but to save the country from falling apart we finally need to swallow a bitter pill. Let’s just face it – there are far too many untouchable privileged groups in this country that live off other taxpayers’ money – policemen entitled to pension off after 15 years in services, farmers who do not have to pay social security contributions, prosecutors and judges with pension privileges, clergy paying very low lump-sum taxes with pension contributions paid by the state. Plus thousands of other people who retire much earlier than in Western Europe, despite being still in good health. Whenever you get more than you deserve, in overall account it is not for free, just if you do not pay for it, someone else has to fork out money for your privilege. This is called redistribution of wealth. The questions remains, to what extent redistribution is fair? I am of the opinion a well-developed society cannot go without redistribution, as there are disadvantaged people who really need help and who are not culpable of their predicament, there is a need to provide equal chances to children from poor families and help those gifted young people break away from poverty, finally there are forms of getting income that have to be taxed, owing to putting no or little effort in earning – therefore I will probably never approve of lifting capital gains tax or will not be fully convinced to advantages of scrapping inheritance and donation tax.

Done with general assessment of the address, let’s drill down into details. Around twenty minutes past midday Mr Tusk said: Chcemy po pierwsze wyraźnie zwiększyć i unowocześnić daninę, którą w tej chwili pobieramy w niewystarczającym stopniu od wydobywanych bogactw naturalnych przede wszystkim miedź i srebro. (Firstly, we want to raise and revamp the tax levied on extraction of natural resources, particularly copper and silver.)

KGHM is a partly state-owned company dealing with extraction and processing of copper. In terms of market capitalisation it is the biggest company listed on Warsaw Stock Exchange. Now get the load of this… The chart shows quotations of KGHM on Friday.

Red circle marks the abrupt reaction to Mr Tusk’s declaration – price of KGHM shares plummeted by roughly 5% within less than five minutes. Number of transactions was twenty times higher than before the words of new tax. Then we saw a double-dip formation (blue circle) that portended a rebound that did not last long. Around half past four market saw the second wave of sell-off (green circle), just after five KGHM stock fell by more than 10% and trading was suspended (violet circle). Friday close price was 13.83% lower than Thursday one… Note also the volume (blue bars at the bottom). Turnover was low until the announcements and than it escalated in moment when price was going down – this shows the strength of the downward trend…

The sell-off soon prompted the questions about beneficiaries and victims of the turmoil. Government members avow that information about the content of prime minister’s speech did not leak out, Polish Financial Watchdog, for sake of good order, should carry out an investigation. In such situation, investors with inside knowledge could have sold their shares in advance, before the price plunged and speculators could have shorted them and rake in profits very quickly. I hope this will all straighten out and politicians will think twice before the say something that would swing the market…

Sunday, 13 November 2011

Daleko od Wawelu - book review

Spent the last two days of the shorter working week (i.e. Wednesday and Thursday) on a sick leave. I had been fighting the illness since late October, but surrounded all the time either by sneezing and coughing parents at home or by sneezing and coughing colleagues at work, I finally gave up and came down with some sort of cold. Unfortunately for my employer, I was not the only one to be absent at work at this time, but if they wanted an open plan, they should have taken into account that they would create excellent conditions for germs to fly around. And so they did…

Actually feeling a bit off-colour and staying in bed for three days has even done me good. The first day, when I had a fever did not actually bring the coveted chill-out, but then I finally found time to read books and watch films I had planned to read or watch since months.

One of them was the book written by Michał Majewski and Paweł Reszka - Daleko od Wawelu (“Far from Wawel”, where Poland’s late president Lech Kaczyński was buried). I first heard of the book in October 2010, just upon its publishing, as it was mentioned in “Polityka” as a good account of Lech Kaczyński’s term in office. As the book was reviewed mostly in liberal media, I thought it would focus on presenting the demerits of late president, yet, to my surprise, the picture of the Lech Kaczyński is anything, but one-sided.

As the authors declare, the book, compiled over many months was set to be given some finishing touches in April 2010. Before final editing, authors were appointed to talk it over with Mr Kaczyński himself, yet the final meeting was postponed until mid-April 2010 in the run-up to visit in Smolensk. Needless to say, it has never been held. Shock brought about by the Smolensk disaster put the publishing plans on hold, but a few months later authors decided to make a few technical amendments (e.g. putting past tense instead of present, for “technical” reasons) and print in the book in its pre-Smolensk shape and under a different title.

Mr Majewski and Reszka have aptly drawn a picture of Lech Kaczynski as an ordinary man, as many of us having feet of clay. They carried out several interviews with people who knew the late president well and put their accounts together. The profile of the late head of state is delineated in an unbiased way, giving credit when it was due, and pointing at weaknesses, when necessary. The picture of Lech Kaczynski which emerges from the book shows a man full of contradictions, driven most by emotions. As someone claimed, you could tell about Mr Kaczynski that he was a kind-hearted, affable interlocutor, great speaker who could deliver a speech ad hoc, meet people in a provincial town and talk to them spontaneously, or you could call him hot-tempered, dogged, disorganised, suspicious or indecisive and in both cases you would not depart from the truth. Lech Kaczynski changed moods very quickly, shouted at people and fired them, just to forget about such brawls after two days…

The biggest problem of Mr Kaczynski was, from what I inferred from the book, the fact he was extremely pliable. It is commonly known that he was steered by his brother, who had laid out their plans in politics, and wife, who toned him down, yet this was not the real case. The late president was surrounded by droves of people working in his office who competed with one another at work and used their positions to pursue their own goals. Mr Kaczynski apparently could not tell a sincere man from a mercenary bastard and often trusted too much those who did not deserve it.

Mr Kaczynski seems to appear as a victim of bad people. Not just of his brother, who made him a meaningful figure in politics or the lousy entourage from his office. As everyone realises, late president fell victim of black PR campaigns run by PO politicians masterfully since their victory in 2007 parliamentary election. The purport of PO’s depiction of the president was to present him as a stumbling block that prevents the country from moving forward and an excuse for government’s idleness. The book also sheds some light on the dark side of PO and its leader, Donald Tusk, who have rarely held back from punching below the belt. Recently, the author published a new book, titled Daleko od miłości (“Far from love”), being a similar profile of prime minister Donald Tusk. As soon as I get hold of it and read it from cover to cover, you can expect a review here.

Mr Lech Kaczynski was derided not only in Poland. Foreign diplomats took the trouble to work him out and find his soft spots. In a psychological profile they noticed he felt badly in official situations and was ill at ease during less official meeting owing to his lack of command of foreign languages. They did not hesitate to make use of that knowledge to pound at him. No wonder his ability to pursue foreign policy in a way many Poles wanted (similar to his predecessor, Mr Kwaśniewski) was largely limited.

I was deeply appalled by the overwhelming disorganisation of Mr Kaczynski’s office (kancelaria) workings. The late president could not enforce discipline, the office was run by competing cliques, decisions, due to president’s inherent indecisiveness were taken at hour eleventh, meetings were arranged much too late. Many decisions were taken on the spur of the moment and inspired by bouts of emotions. The book provides a coverage of incident of the ‘Georgian flight’, when the pilot refused to touch down in Tbilisi, slightly different than presented in Gazeta Wyborcza and gives good insight into the president foray into provincial Georgia in November 2008 when someone could have tried to shoot the president. This case, when plans were rapidly changed only due to president Saakashvili’s whim and without providing proper security to the head of state sheds light not only on bad organisation of president’s administration but also is a big question mark for alleged big friendship between the two presidents.

After reading the book, Lech Kaczynski is in my mind more like a tragic character than a mediocre president. I still claim he did not deserve to be buried in Wawel, but the time will not be turned back. The late president was actually a good man, but had no makings for a president. He did not feel comfortable holding the office and it probably would have been better if he had stayed on as professor, instead of stepping back into politics.

Sunday, 6 November 2011

Shame on you if you fool me once...

…but shame on me if you fool me twice. Sometimes sayings that refer to ordinary life apply to politics and economy as well.

Have you ever wondered how many times have Greeks double-crossed their breadwinners from the EU? Greece joined the European Economic Community in 1981. I have to plead I know little about the backstage of entrance to European Communities at that time, but from what I remember at that time a country which applied for a membership did not have to meet any quantitative criteria. From that point being a member of EEC has helped Greece make a big stride, yet not in terms of development, but in terms of standard of living.

Things have changed after the Maastricht Treaty was signed and took effect. It laid foundation for single currency area and set requirements a country which wanted to join it had to meet. Two of them referred to soundness of public finances – each applicant had to keep general government deficit below 3% of GDP and the whole public debt could not account for more than 60% of GDP. These are figures, and whenever statistics are in use, room for tampering can be found. Here’s the rub – when calculating the public debt a country was allowed to legally subtract some of its liabilities. The main method of concealing some of debts was using complex financial instruments, mainly cross-currency swaps that allowed the Greek government to issue bonds in other currencies at “arranged rates” and with deferred maturity. The operation that helped Greeks dupe the EU was brought off in liaison with Goldman Sachs (the bank that rules the world, there is more than just a grain of truth in this assertion). Thus in official statistics the debt was curbed, in fact it morphed into time bomb that would blow up Greece’s public finances in a few years.

For many years Greek sovereign bonds were treated as safe investment. When banking crisis in 2008 reached its zenith, many banks in Europe, including Dexia lost millions on toxic US mortgage-market-related assets, but then received capital injections. This money was parked in safe havens. One of them were Greek bonds. Collapse of Greece’s public finances came to the light in September 2009. From then on, Greece has faced insolvency many times. For the first time it received a bailout package in May 2010. Over 100 billion Euros let the country avoid bankruptcy then, but this was just the first injection of never-ending drip of money. To borrow money on preferential terms from the EU and the IMF, Greece had to implement painful austerity measures. Greeks, pampered by overgrown welfare system, went to the streets to protest against dreadful retrenchment programme. The country repeatedly came to a standstill, strikes exacerbated economic contraction and debt-to-GDP ratio soared.

In most European countries the crisis was sparked by excessive expansion of deregulated banking industry, mainly consisting in reckless mortgage lending. In Greece banking sector stayed relatively healthy. The overgrown welfare state and lack of competitiveness of Greek economy were the nails used to close the coffin of Greece. Many privileges, despite social unrest, can be scrapped, but structural changes are will not be easily brought in, given the mentality of Greek society. Big grey economy and widespread claimant stance (postawa roszczeniowa) will be a stumble block. Greece must not only cut ridiculous expenses, but also take steps to boost its tax revenue base. Tax evasion must finally be severely punished, wages must finally be linked to efficiency. It sounds simply, but Greece has to get to grips with bigger challenges. In needs to carry out structural reforms to make its products and services sellable on global markets. It would be easier if they could be sold at lower prices, but as long as Greece is a member of the Eurozone, devaluation of currency does not come into play.

Solidarity is a glue that stick together the European Union. Poland is also a big beneficiary of this. As a poorer country we receive lots of money to modernise the country. A big leap being made in infrastructure development can be put down the inflow of EU funds, but life is not only about taking, but also about giving. One country should not sponge on other, as Greece has done. And if other countries bail one country out, it should not come up with ideas such as the one to call a referendum whether to accept another tranche of bailout package, subject to another dose of painful reforms.

Someone finally should bite the bullet and pull the plug on Greece. I would simply let it go bust, let banks write down or write off value of Greek bonds (most creditors of Greece are capable to absorb such losses, although it would be a blow to their shareholders). I would even let it start from scratch. But even in such scenario, I seriously doubt if Greeks would learn from their mistakes. They would rather be taught that if creditors let them get away with not meeting their obligations, that they can carry on living off other countries’ backs.

The Euro, as a currency, as well as the Eurozone, are political, not economic undertakings and for that reason no one will have the courage to kick out Greece from the eurozone. Admitting one’s defeat is a bitter pill to swallow, but in my view, this painful solution would in long-term turn out to be best, and less costly than pumping next billions into a bankrupt country.

Tuesday, 1 November 2011

All Saints' Day

Year by year, I dare to claim the first day of November is called ‘All Saints’ Day’ because it takes patience of a Saint to survive it. Having spent almost 24 years in this world I still can’t grasp the concept of rounding up all people on cemeteries around one day. Maybe the incongruity is no bigger than distributing visits over the whole year, but these visits result in throng, throng and once again throng. Jammed roads near cemeteries, crowds of people walking from one grave to another, hundreds of candle- and flower-sellers putting up their stalls outside cemeteries, drivers struggling to park their vehicles – these are main types of entertainment on that lovely day.

Visits to cemeteries make an opportunity to ponder upon the place of death in contemporary culture. Remembrance is being pushed aside – just take a look – everyone suddenly remembers about the departed around 1 November and as soon as they come back from cemeteries, they forget, until the next year. Just a week ago when my mother and I drove to Piaseczno to tidy up my grandparents’ grave, they were hardly any cars outside cemetery gate. Today cars were parked everywhere, within the distance of one kilometre from the cemetery. Oddly enough, traffic away from cemeteries is quite sparse, but beware…

Long weekend around All Saints’ Day is a time when too many people depart this world. From Saturday until today’s afternoon death toll has hit 47, 476 people were injured in traffic accidents. This weekend will go down as one of the most tragic of all. Everyone says weather is to blame. In most parts of Poland the day is warm, visibility is reasonably good, it doesn’t rain nor snow, so drivers tend to put their foot down. The higher the speed, the more tragic accidents are. When the weather gets bad, drivers slow down, there are more prangs, but far fewer people die or are injured. Today I saw one smash-up, typical rear-ending, quite hard to understand for me, but from what I’ve observed over the past weekend, drivers’ behaviour this year is even up to the mark, the biggest dangers are posed by reckless pedestrians. Such thoughtlessness, recklessness and inattention have I never seen. Walking in the middle of a road, trespassing onto the road just in front of an oncoming car, swerving, standing on a road and staring at God knows what, staggering. No wonder pedestrians account for about 50% of this weekend’s fatalities. If my observations are right, in many cases they also caused accidents. Another plague are of course cyclists, usually elderly people riding their bikes loaded with kilograms of stuff they carry to a cemetery. The wobble, don’t see what’s going on behind them. So beware of them as well.

Not breaking the old tradition, my family visit the graves earlier. We went to Bródno in mid-October, a week later to Piaseczno, as our visit coincided with my grandfather’s death anniversary and on Sunday we went to Prażmów and again to Piaseczno. As yesterday my father was busy and I was at work, last visits were put back to today. In the morning we visited cemetery in Konstancin where my father’s family rest and then went again to Piaseczno. Fortunately, the tour was ticked off by midday and in the afternoon I could enjoy a walk on a lovely autumnal afternoon (temperature of +13C, four degrees cooler than a year ago, yet still balmy).

To the right – a symbolic grave of three boys, aged 20 – 21, killed in an accident on 15 September 2011. The inebriated driver of BMW 735 drove at almost 200 kmph, so as it lost control over the car and it went into a skid, the Burak Ma Wózek shattered into pieces. One of the passengers, who hadn’t fastened safety belts was shot out of the car and miraculously survived. Three other ones died at the scene. The accident was the local “issue of the day”, but later the coverage of it ceased. As my mother’s friend learnt, the driver was a son of a local policeman so no wonder the case was covered up. Maybe I am insensitive, but I don’t understand why so many people feel sorry for the drunk idiots who killed themselves. I feel sorry for their families and feel a big relief that they didn’t kill anyone else. And I can’t see the point in making an altar out of rear lamp and parts of bumper of the written-off car. So many people cry after three sods, while many valuable people die in loneliness…

Then I strolled west to Stara Iwiczna, to visit a small, cosy cemetery, with beginnings traced back to first half of nineteenth century. I noticed the local society has put up a symbolic grave for priest Andrzej Kwaśnik who used to be a rector of the parish in Stara Iwiczna for 12 years. He died tragically in near Smolensk on 10 April 2010.

Heading back home, I snap another nightmare outside cemetery gate. This is just a small cemetery and cars are parked everywhere. The worst thing is that everyone MUST take their cars, normally kept in a barn unused and go to a cemetery by car, even if they live within a walking distance from it. My neighbours came there by their clapped-out car and thus covered almost one kilometre in a car, rather than as they should – on foot.

Around that day, I came to think about Karol, whom I had lent 1,000 PLN in May 2010. Needless to say I still haven’t recovered the money. I decided to call his mother to find out how he was doing. I called her on her mobile, from mine, without withholding the number. There was no reply. Yesterday I dialled their landline number and in case they had caller ID detection on, withheld my number. The one who picked up the phone was Karol. Now I know he stays at home and is alive. It finally sank in to me that I’ve long got over the loss of money, but I can’t get over being duped…

And finally yesterday, while being on a loose end at work, I browsed profiles of famous people who passed away over the last year. And… the read was a bit shocking. Out of 24 people, two were hated by millions and killed (Osama Ibn Laden, Muammar Gaddafi), two committed suicides (Andrzej Lepper, Edward Żentara) and one was a drug- and alcohol-addict (Amy Winehouse). The list is lightly dejecting, but uplifting is the news that over 200 lives were saved today