NewsWhore
08-28-2012, 05:30 PM
The heavy increase in public indebtedness contrasts with the lack of credit movement in the private sector, according to Diario Libre. Credit from commercial banks to the public sector in the first 20 days of August increased by 49%, or RD$22.39 billion. The increase to the private sector was RD$991 million. That means the government borrowed 22.5 times more than the private sector, according to data from the Central Bank. The previous government borrowed RD$68.5 billion, as of 20 August.
Diario Libre points out that meanwhile the private sector increased its savings by 7.7 times as much as the public sector saved. The government increased its savings by RD$1.9 billion, but in the private sector savings were up RD$14.68 billion.
The newspaper makes the point that when the Central Bank softened its monetary policy to reduce the cost of borrowing, it was the public sector that went on a borrowing spree. The total credit of the commercial banks to the public sector climbed to RD$68.5 billion as of 20 August of this year, both for loans in pesos as well as in dollars, which is only comparable with the spike registered in April 2010 when the country was in full spending expansion and indebtedness with the IMF agreement, which reached RD$71.785 billion. In the meantime, on the savings side, the reverse is happening. While the government has increased its balance in savings and current accounts by RD$1.9 billion, the private sector has increased its savings by RD$14.7 billion, which is to say that the private sector has saved 7.7 times more than the public sector.
More... (http://www.dr1.com/index.html#8)
Diario Libre points out that meanwhile the private sector increased its savings by 7.7 times as much as the public sector saved. The government increased its savings by RD$1.9 billion, but in the private sector savings were up RD$14.68 billion.
The newspaper makes the point that when the Central Bank softened its monetary policy to reduce the cost of borrowing, it was the public sector that went on a borrowing spree. The total credit of the commercial banks to the public sector climbed to RD$68.5 billion as of 20 August of this year, both for loans in pesos as well as in dollars, which is only comparable with the spike registered in April 2010 when the country was in full spending expansion and indebtedness with the IMF agreement, which reached RD$71.785 billion. In the meantime, on the savings side, the reverse is happening. While the government has increased its balance in savings and current accounts by RD$1.9 billion, the private sector has increased its savings by RD$14.7 billion, which is to say that the private sector has saved 7.7 times more than the public sector.
More... (http://www.dr1.com/index.html#8)