What I observe in the UK today, is what I observed in Greece, after 2004 and what I was monitoring in Cyprus, during 2008-2013. MSN published today that another company entered administration. There is a pattern that explains this trend. People have money and spend, during good times but then people have less money, spend less and too many companies suffer huge losses. If we observe the current situation, the people have to pay increased bills. So their extra choices are becoming too limited. After they spend the money for the bills and the rent, they have to choose between food and heating. Anything else has become luxury.
As far as I remember, in the main avenue of Nicosia, there was a BHS store. It shut down when I was still in primary school. Their merchandise was expensive and to my own eyes seemed outdated, as well. I noticed that two decades later, it collapsed in the UK, entered administration and shut down. In the last few years too many companies entered administration. Woolworths, Debenhams, Wilko, Bodycare. There is an extremely simplified explanation for that. Higher costs, high prices, losing customers. As I remember, there was a customer mentioning “why pay for washing powder 4 pounds in Wilko since the exact same costs 2 pounds in Poundland? “.
There was an interesting story during the collapse of Cyprus Airways and Olympic Airways. At the time we all struggled to attract investors, in order to save those two companies, there was another part, inside each company, trying to save their own benefits. Trying to save their own (and unexplained..) benefits meant that no serious investors would risk to save them. That was the main reason that the UK government gave British Airways to the private sector. There is a moment you are not able to control everything. Greece and Cyprus failed to receive the message.
The collapse of the banking system in Iceland is an extremely interesting example of proper management. You leave the markets to do their own job and at the same time you avoid transferring those losses and other hidden obligations to the people that had nothing to do with the mess. The law did their job, as well, investigated and punished. Cyprus followed a completely different behaviour, a few years later. The major Cyprus Banks (Bank of Cyprus and Cyprus Popular Bank) invested in Russia and Ukraine but the outcome was extremely poor. In the exact same period the Cyprus government used the Social Security Pot for their own salaries and pensions. That also activated and increased the financial instability, known as Ponzi finance. There were clear criminal activities, implemented by the Cyprus administrations during that period of time. Although, in Cyprus the bubbles of the oligarchs are too strong. They protect each other and transfer the bill to the rest of the population. The population realised a few years later that their property (including their houses) were sold to foreign funds, in order to cover the losses caused by the banking gang.
There are two extremely valuable books, describing what happens in Cyprus. THE GANG (2020) and MAFIA-STATE (2022) both written by the Cypriot researcher Makarios Drousiotis, explaining how the former Cyprus president, Nikos Anastasiadis, was involved in the wrong-doing and money-laundering. Those two books are part of my own collection, next to the Trading Game of Gary Stevenson, just because there is a continuity from “The Trading Game” period to the GANG and the MAFIA-STATE. Anastasiadis was indeed involved in money-laundering and there are too many proofs for that. The worst part is that the collection of evidence includes the Tassos Papadopoulos administration (2003-2008) in addition to the Dimitris Christofias administration (2008-2013) as well. What happened in Cyprus is still kept hidden and the time it will be revealed, in detail, it will show something worse, the involvement of the European Commission and their own criminal activities..
Nicos Rafidhias studied Political Science and European integration before and during the creation of the European Union and the Euro Zone.
LinkedIn: https://www.linkedin.com/in/nicos-rafidhias/
Personal page: www.nicosrafidhias.co.uk
Business page: www.officeofis.co.uk
This article is part of his recent book regarding the boom and bust of corporations and countries.
END OF PART II
