It seems the hottest topic in the news here in Jamaica is the financial civil war that has erupted in the past few weeks! It is such a hot topic that it has even almost overshadowed the Local Government Elections that will be held shortly.
Of late many more ordinary Jamaicans have opted to invest their hard earned money in high yield alternative investments schemes in a bid to earned tangible interest on their principals. One of such investment companies, is the locally popular
Cash Plus Limited. This investment company is one of several high yield investment companies that have been termed as risky and unregistered investments entities by the local commercial banks. But why have the ordinary Jamaican, despite the many warnings, leave the apparent safety of the commercial banks to gamble their hard earned money in such risky investments?
Well, my answer is just a layman's answer, not the reliable comments of a financial analyst. Times are hard, many Jamaicans are grossly underpaid, inflation is growing at an alarming rate, the dollar is devaluing every day and the same commerical institutions are offering little or no help to the ordinary Jamaican. But why would I say the commercial institutions are not helping? Well if we compare the the interest charged on loans with the interest paid on savings, there is no wonder why the top management of such banks can get seven digit salaries while your money seems to be growing only from your own input. I may be corrected on this, but the average interest paid on savings rarely goes above six percent per annum, while the interest charged on an ordinary almost never fall below seventeen percent per annum. There is no wonder why an interest rate of ten percent per month would seem attractive enough to take a risk!
As a result, many Jamaicans have taken the leap of faith and have been withdrawing their savings and deducting from their monthly commercial bank savings to take a leap of faith and invest in Cash Plus. This has definitely not gone down well with the leading commercial banks which have launched an all out assault on these alternative investment options, including the famed Cash Plus! It seems the commercial banks attacks started with harsh warnings to the public, which escalated into pressuring the government to act, however, these actions have seemed to do little to quench the publics fire for Cash Plus. This would not deter the banks as the have resorted to dishonoring checks to and from institutions such as Cash Plus and OLINT, considering closing the accounts all accounts relating to these "unregistered institutions" and reports are that they have even gone as far as threatening their own staff if they are found to be investing in entities such as Cash Plus. However, Cash Plus has been vigorously attempting to assure its investors that this latest move by the banks will no bring the company and its subsidiaries down, through the printed media and mass meetings and have begun to explore other means of paying their investors their returns. [
read story]
Who will win this war? Will the banks succeed in bringing down these investment companies, or will companies like Cash Plus and OLINT grow ever stronger? Will the banks actions reestablish themselves as the investment option of choice or will their actions bring an unwanted backlash? As the missiles fly across the battle field, only time will tell. What are your thoughts on this financial war?
Yes, I said it, cold a bite mi! As I stepped out of the airport the cold of late autumn was there to greet me with wide open arms! Not even in my freezer of an office, compares to the cold I feel while I am here. I haven't done anything so far since I came up here apart from trying to stay warm and eat all the food I can't afford when I'm on the Rock! But I have mustered up the courage to head out into the cold, so tomorrow I'll be on the road to soak in some of the frigid weather. Yeaahhh!
