We Live in Belgium...

We live in
Belgium, a little country right in the heart of Europe. The country is in many
ways a small version of Europe. Most have heard of Brussels, which is not only
the capital of Belgium, but of the whole of Europe. Belgium is becoming a divided
country, with the two largest communities – the Flemish (Dutch speaking) and
the Walloons (French speaking) –  opposing
to each other on different levels, but mostly about financial issues.

This
disunity of Belgium typifies the larger European Union, which is a hodgepodge
of countries with a lot of differences (cultural, languages, ...) and only one
common aspect: the euro. A currency more and more experts are starting to
question!

But not all
things are turning sour in Belgium. Belgians have it for the good life. The
country is widely known for its waffles, chocolate and pralines, beer and fries.
Its inhabitants have a taste for good food and strive for a higher standard of
living. Things like culture (fine arts, music, ...) and folklore are highly
ranked.

But this ‘good
life’ is coming at a cost nowadays, a cost which is rising at a phenomenal pace. A
typical shopping list doubled over the last five years, while the bills for
energy, insurance, ... are going through the roof lately. Just last month, they
raised the electricity bill in Flanders with 10%! Americans often think that
driving a car in the US is becoming expensive, with gas prices hovering around
$4 per gallon. Well, over here in Belgium, we’re currently paying around $8 at
the pump.

Inflation
is running rampant in Belgium, although government statics are pointing at modest
increases for consumer prices. Being Belgians, we know better by now. The fear
of a potential runaway inflation is putting pressure on people's sentiment. Luckily, we
have a very open cultural towards gold. You can buy gold not only at your local
coin shop, but also order it at the bank. A simple phone call and the physical
yellow metal is delivered in all forms. And gold isn’t being taxed, like silver
which comes with a VAT of 21 percent on top of the selling price. That’s why
there is a larger gold community in Belgium than in other parts of Europe. But gold is generally well distributed among Europeans.

Being
commodity and precious metals analysts in Belgium, and to a wider range the
Benelux and Europe, we often get the question whether gold is in a bubble.
This is not such an unusual question as many have been riding the gold bull all
the way from the bottom ten years ago. To us, it is clear that gold is most
definitely not in a bubble. We often speak to bankers of all kinds, and they
still concentrate their clients’ portfolios in the classical way: a diversified
portfolio of bonds, equities, real estate and cash. Seldom do private bankers
or family offices allocate more than a few percentage points to gold or silver.

As the
graph below shows, gold is still a marginal phenomenon. Gold and gold mining
shares represent a tiny fraction of what they used to in the 1980s. It is
therefore a fallacy to say that gold is over-owned, that it is a speculative
bubble, etc. Financial assets such as stocks and bonds represent the bulk of all
global wealth. Also in Europe...

So who are these European gold investors? First of all, we have the
impression they are a bit older than average. Many European gold investors have
inherited bullion and gold coins from their (grand)parents, and fully realise
their value. Most of them are not obliged to sell. On the other hand, we have
the impression many younger people are starting to grasp the true value of gold
and what it can do to protect a portfolio. Younger people, who often get their
financial information from top-notch financial blogs (such as Zerohedge) are
mostly more informed about the true state of affairs than mainstream media,
which tend to deliver a lot of noise.

Our conclusion is that it is ridicilous to assert that gold is in a bubble
when it represents a mere 0.8% of global assets. We frequently ask John Doe whether he owns gold and the
answer is always negative, even after a fourfold of the price of gold in euro.

Gold still has a long, long way to go before it is fully valued, or even
overvalued. We continue to advocate euro/dollar cost-averaging into the yellow
metal combined with a selection of quality junior gold stocks. You have
to protect yourself from the fiat currency delirium, even if you’re living in
Belgium.

 >>> Smart Money Europe

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Comments

[Reptil]

ooohh a monday morning bitch slap contest. hèhèhè

link please?

Anyhow.... It seems to have escaped you that I tried to point out that only a small group is responsible for that particular sexring. and that this in no way can be attributed to the belgian population at large. Over here it seems it's predominantly the roman catholic church that endowed in some "transgressions". (off the deep end)

Nevertheless, notwhithstanding, IME there's a notable difference in the management culture of both our countries. Which would (and did) result in different solutions (or lack thereof) to the bank insolvency crisis. In no way the dutch management are more equipped to tackle this, since part of the same "group think". However, blunt as dutch are, critisism from the lower ranks is more vocal, and accepted throughout society. That also results in some rudeness, now and then.

So.... what's it gonna be? Bank run in Belgium, or not.

[Reptil]

IME there's two groups of people in Belgium: the ordinairy worker, office clerk, their family, and there's the "elite". Belgian corporate culture is very hierarchical, often clashes with the dutch. The belgian elite behave like "untouchables", resulting in a very unflexible management structure. This became evident during the banking crisis when Fortis came tumbling down, and had to be bailed out by the dutch insurance branch of the company (which was guaranteed by the dutch state). The belgian Fortis management then subsequently claimed 1.3 billion euros in damages to the dutch state, for compensation. To my best knowledge, that claim never made it.

As far as the "Dutroux" schandal, and the (never resolved) sexring operations, yes, inside the belgian elite, there's a dark part, that is corrupted. It's important however to seperate this from other parts of belgian society, and do a careful analasys. Not all americans are arrogant bloated douchebags, that think "nukes" are a stopgap solution to every problem. To generalise in a positive or negative way (waffles are for damn tourists) is not to the point, IMHO of course.

[RubberMartyr]

Wat denk je over de huizenprijzen in België?

Die moeten toch ook naar beneden komen in de volgende jaren...

[Sudden Debt]

Vorige jaar ook 10% erbij, en dit jaar blijft het stijgen.

Mijn schoonzus is Notaris en schatter van vastgoed en daar krijg ik constant te horen dat Belgisch vastgoed tot 75% overgewaardeerd is.

En onze demografie zit ook al niet goed he. Binnen 10 jaar zit 23% van de belgische bevolking in het bejaardentehuis, en die vertegenwoordigen het meeste vastgoed in België. Tenzij onze afrikaanse vrienden er opeens in slagen alles op te kopen...

Dat moet gewoon naar beneden knallen, en hoe langer het duurt, hoe zwaarder het zal zijn.

Het enige dat het nog vasthoudt is onze tewerkstelling die zeer hoog is en dat is ook dankzij onze demografie.

Maar binnen de 5 jaar hebben we ervan.

Onlangs toonde een jonge gast op men werk me een huis dat hij wilde kopen. 190.000 voor wel... een krot. Ik vertelde hem dat hij nog zeker 100K nodig had voor renovaties, maar hij was ervan overtuigd dat hijzelf wel alles kon klussen...

Ze vergeten ook vaak dat die huizen reeds rot zijn en als je die koopt ze nog eens 50 jaar mee moeten gaan.

[disabledvet]

ahhh.  "free at last, free at last."

[Reptil]

Ik wacht even met kopen. :-)

[Reptil]

Things that make you go hmmmm?

I guess when/if Belgium falls apart in two parts, there'll be a renewed price discovery. I know in Brussels, prices are shooting up, because of the EU burocracy present there. The rest of Belgium? Not so sure...

More pressing IMO, how long will the mortgage tax deduction of the Netherlands hold up?

Here's the IMF whining about it: http://www.nrc.nl/nieuws/2011/03/28/imf-kabinet-moet-hypotheekrenteaftrek-beperken/

Which is totally paradoxal, since their proposal to axe the subsedies will send the housing prices plunge in the Netherlands (compare with the prices in Germany!).

The IMF is a rabid dog, biting the hand that feeds it? http://www.rijksoverheid.nl/documenten-en-publicaties/kamerstukken/2010/11/25/overzicht-bijdragen-aan-het-imf.html

That's 5.9 billion euro...

[Reptil]

Belgian workers (yep there's still production in the EU) not taking it ("austerity" measures to cover up the financial insolvency) anymore from the (illegal) European Commission and staging a protest, only to be beaten back with pepperspray and baton:

http://www.youtube.com/watch?v=2vEdgySRnxk

funny how this never made the MSM. geee I wonder why...

[Herman Strandsc...]

Thanks for the video link to the Red Marxist protest in Belgium. Could only happen in Belgium whereby the Belgumie marxists protest against the EU marxists HQ in their own country.

EDIT and I may add that those protesters probably work for the EU in one form or another.

[Arch Duke Ferdinand]

""Belgium is becoming a divided country, with the two largest communities – the Flemish (Dutch speaking) and the Walloons (French speaking) –  opposing to each other on different levels, but mostly about financial issues.""

...Canada has the same mess....

Eastern Canada with a Dead Manufacturing Industry (plus Canada's Wall Street Financial Industry and Political Power in Ottawa) 

While Canada's four Western Provinces have all the natural resources w/ only 12.5 million citizens.

Today, the four western provinces are considered the safest quadrant on our Planet....

http://seenoevilspeaknoevilhearnoevil.blogspot.com/2011/03/why-canadas-four-western-provinces-is.html

[Reptil]

This is an unavoidable development: As nation states are being hollowed out by the politicians that are supposed to represent the people within that judicial union, and it's being replaced by supranational government (European Union, North American Union), there's going to be a redefinition of communities and regional cohesion. This can be seen throughout history, and will undoubtedly happen in the larger nationstates on the planet too. An effect unforseen by those pushing for a larger union, but a direct result of their (illegal) actions.

As for Canada: I have some relatives and business associates there, they're still enjoying the idea they're citizens of a souverign state. I seriously doubt this is going to continue. The signs of the contrary happening are visible: http://www.globalresearch.ca/index.php?context=va&aid=8323

[disabledvet]

we have a (shredded) Constitution in the USA.  That's "the problem."  It's that idea of a "right" as part of an actual contract between gvnt and citizen.  that includes "cost of xercising said right."  the "answer" is same:  war, war, war ("someone tell that pastor to shut up!") to "tell us how it is."  btw  "the Constitution considers all people as citizens"--not just 'mericans.

[Reptil]

Ok, no one could answer this question; are the Belgians going to do a bank run like this?

http://www.guardian.co.uk/business/2011/mar/27/dutch-bankers-bonuses-axe...

Dutch bankers' bonuses axed by people power
An online campaign has overturned ING's executive pay policy, and the mood in Amsterdam is getting increasingly militant about bonuses at bailed-out banks
    ?    Richard Wachman in Amsterdam
    ?    The Observer, Sunday 27 March 2011
    ?   
    ?    Customers at Dutch bank ING threatened to collectively withdraw deposits in protest against bonuses awarded to executives. Photograph Frank Rumpenhorst/EPA
Britain has a rival when it comes to bashing bankers. After a furious row over pay packages at Amsterdam-based ING in which thousands of customers threatened to make mass withdrawals, the Netherlands is now vying for the title of Europe's most bonus-hating country.
A growing Dutch political storm could end with a blanket ban on bonuses to financiers who work for institutions bailed out by the taxpayer.
ING customers mobilised on Twitter and other social networks to protest at bonuses paid to bosses at the bank, one of the biggest in the country. The threat of direct action raised the spectre of a partial run on ING, terrifying the Dutch establishment. Fred Polhout, union organiser at the bank, says: "People were outraged. We heard about the bloated sums being paid again in the City and in New York; but suddenly the issue exploded on our own front door."
Compared with the packages awarded to bankers in the US and UK, the Dutch bonuses were small potatoes. Jan Hommen, ING's chief executive, was due to receive a £1m bonus – a pittance when you consider that Stephen Hester, head of state-controlled RBS in the UK, is in line for up to £7.7m, Bob Diamond of Barclays is to collect as much as £6.5m, and some senior bankers at Goldman Sachs and JP Morgan are looking at windfalls of about £40m each.
"Perhaps we are so upset because we are a small country that prefers to set an example, rather than follow others," suggests Polhout.
So severe was the public reaction to Hommen's bonus that within days he had agreed to waive the award and told other ING directors to do the same.
Now the Netherlands is going through a painful period of introspection and soul-searching. Politicians have voted to implement a 100% retrospective tax on all bonuses paid to executives at institutions that received state aid as a result of the financial crisis. In other words, no banker should get a bonus until the debt is cleared, and they should return payments made since 2008.
ING was thrown a €10bn (£8.7bn) lifeline to stop it going under, while ABN Amro was nationalised. Numerous other Dutch financial firms received capital support, including Aegon, SNS Reaal and ASR Nederland.
On the streets of Amsterdam, there is little sympathy for the bankers. Emma Rohl, who works at an English bookshop in the city centre, says: "They shouldn't get bonuses at all. Why should people be paid vast sums for going into work and doing their jobs? It's utterly ridiculous."
Erick Koenig at a nearby restaurant says: "We rescued the banks from their own follies, and now they expect to be paid extra. I think they should work for free for at least five years."
At a dusty office in a northern suburb of Amsterdam, Henk van der Kolk, head of the country's biggest trade union, FNV Bondgenoten, does nothing to conceal his frustration: "Everybody is angry about what happened at ING. The board isn't in tune with public opinion. What were they thinking of? ING pensioners have seen their payouts frozen, while many employees were awarded a pay increase of just 1%."
Van der Kolk's union is pushing for a law that would ensure that executive pay should never amount to more than 20 times the wage paid to the lowest-salaried employee. As for bonuses, the union feels payouts should not exceed 50% of a director's salary. Hommen's bonus was worth 92% of his €1.35m package.
"Remuneration for bankers was linked to financial machismo, which encouraged irresponsible lending. We want to get away from the bonus culture," says van der Kolk.
But given the payouts to ING directors were relatively small, some Dutch bankers are shocked they have received another public mauling.
One ING insider suggests the country was in the grip of a "typically Dutch Lutheran and Calvinist backlash" which cultivates the view that excessive wealth is somehow morally reprehensible and in contravention of traditional Dutch, Christian values. The source says: "We went through this during the boom when ministers railed against stock options and bankers were accused of exhibitionism, and enriching themselves to the detriment of the nation."
The bankers' response that high remuneration is vital to retain talent and prevent Dutch financiers from defecting to overseas banks is given short shrift by Polhout. He says: "Let them go abroad if they don't like it her;, there are plenty of clever people who will take their place and work for less. Good riddance, as far as I am concerned."
Moderate opinion in Holland seems united in its belief that banks which received state aid should not be shelling out bonuses. And Dutch parliamentarians are saying the same thing, demanding the government take immediate action. ING may have made a net profit last year of more than €3bn, but it still owes the taxpayer €5bn.
The uproar against Hommen's bonuses and those earmarked for the bank's senior executives have forced ING to rethink its position. Hommen promises no more bonuses till 2012/13 when the bank expects to have repaid all state aid. In a letter to Dutch newspaper De Volkskrant, he said: "We have underestimated the signal we sent to society. [We] have [risked] renewed damage to the recovering trust of our customers."
Few doubt a critical factor behind ING's volte face was the boycott threatened by consumers.
A spokesman for the bank admitted the payment of bonuses "prompted a reaction from our customers via emails and telephone messages to our call centres". But he said only a few hundred people had actually closed their accounts.
Now the ball is in the court of finance minister Jan Kees de Jager, who must decide how to respond to a proposal by parliament calling for the return of bonuses by all executives at state-supported banks. On a recent television show, he said such a law would be difficult to implement and would hit bankers on average salaries who receive bonuses of just a few thousand euros. But in today's highly charged political atmosphere, de Jager knows that doing nothing is probably not an option

[Azannoth]

"Belgians have it for the good life" a bit OT, I play this real time strategy game called StarCraft 2(#1 game in its segment) playing with or against French speaking people is LOLz as we would say in the gaming community

It's like they have 2 left hands with 1 of them being tied behind their back is how they play

Maybe this is a far fetched theory but when the French speaking people do everything in life like they play SC2 than I don't want to be in any union with them what so ever(political, monetary, military)

Yesterday I was playing a 2v2 game with my french(speaking) buddy :)

1st he did not speak english, so I could not tell him what to do

2nd he produced like 3 units when I had 20

3rd after I single-handidly won the game against the other 2 opponents he started attacking MY units with the 4 units he had at the end of the game :))))), with allys like that who needs enemies :)

[nicholforest]

Have you thought about what he/she might have been doing while you were busy producing 20 units of nothing? Considering the time difference they were probably consuming wine, food or a 'copine'!!

I imagine the view was very different from where the your 'buddy' was - shame you could not speak French, or you might have found out.