Analysis: Govt Plans To Borrow Again This Year

January 30, 2015

[Opinion column written by Larry Burchall]

Earlier this week Minister of Finance Bob Richards dropped a big bomb!

Speaking on on Gary Moreno’s Let’s Talk show, he told us that he would be back to borrowing in this year. That is bad news.

That’s where Government Debt stands on this day as you read this. You’ll see that between 6th August and 16th December 2013, Finance Minister Bob Richards borrowed a total of $800 million. That big borrow was intended to take Government through to FY 2016/17.

That was the promise stated and implied in the Budget Statement set out in February 2014. [That $166,477,500 – is what I describe as Nanci = NNC = Non Negotiable Costs = Debt Service Costs.]

In Bernews, on August 12th 2014, I wrote that the $800 million should run out by 31st March 2017. That was correct. However, Bob’s bomb blew that apart.

Senior notes that form  bermuda's debt and their due dates as at 28th January 2015

When Bob Richards said that he expected to go back the money markets to borrow more funds in this year – 2015 – he also admitted that the ‘money’ was running out faster than he had anticipated.

That scares me. That warns me.

It scares me because it shows that somebody has either made a major mistake or that nobody knew what was really happening. It warns me that the level and quality of financial mis-management has remained the same or has degraded.  Either is bad. Each is unacceptable.

If, as Bob Richards told us, Bermuda is back to borrowing before reasonable planning projections indicated that there should be a need for more borrowing [or making further cuts], then something is horribly, terribly, wrong, wrong, wrong.

The next matter is how much will Bob borrow?

If Bob has no intention of raising the Debt Ceiling from its current high of $2,500,000,000 [$2.5 billion], then, after allowing for deposits in the Sinking Fund, the most that Bob can borrow will be around $400 million. Anything more than that and he will have to raise the Debt Ceiling.

If Bob raises the Debt Ceiling, it really makes no difference how high an already too high number goes. So might as well be cynical and raise it to $10 billion. After all, in the ten years 2005 to 2014, it went up 1,000% [one thousand percent], going from $250 million to $2.5 billion.

He is highly unlikely to get that $400 million at today’s average 5.12% rate. We should anticipate paying the higher rates seen in the schedule. So figure that the $400 million comes at 7.5% [conservative] and remember that the legally required 2.5% Sinking Fund contribution must be added on.

It works out like this:  $400m newly borrowed at 7.5% = $30 million a year + $400m at 2.5% for the Sinking Fund Contribution = $10 million a year. This makes a grand total of $40 million a year for this new $400m borrow.

Put all the borrowed funds together. Today’s $2,185m costing $166 million a year PLUS soon-to-come $400m costing $40 million a year = total Nanci of $166m + $40m = $206 million a year, starting in this calendar year.

That $206 million is way too high. On a Government revenue base that is stuck under $1,000 million, a Nanci cost of $206 million is absolutely unaffordable.

Add the still to come $30 million or so for the 30 year KEMH contract payments [why this figure is such a deep dark secret, I cannot fathom…]; and we get a final Nanci of $236 million in this year.

That means that if Government’s revenue projection for 2015/16 comes in around their projected $930 million; then over 25% of every revenue dollar goes right back out to priority feed Nanci.

That is a disastrous rate of loss of limited and finite revenue. This increased loss will be happening two years before my entirely reasonable projections said it could be happening.

And still facing us is that we must pay back $180m in 2019, $500m in 2020, etc … [See the chart]

The recent fresh financial fact joins with the three day long fussing, fighting, fuming, and fulminating over furlough days, and the fiasco over the non-meetings of Monday afternoon.

So where are we?  My ex-RN father-in-law had an expression for that. He would have said: “We’re off Gurnard in the fog.”

- Larry Burchall


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Comments (61)

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  1. swing voter says:

    Burchall, I’m instructing you to take over that on-going farcical exercise that is dragging this islands reputation further down the tubes. Make the cuts, cut as deep as you feel necessary to ensure Bermuda survives and recovers from this mess.

    • BetttyTrump says:

      The government has failed to address this ongoing problem by developing a plan to address our economy. We are in year three of their leadership and still no viable plan as promised pre election, which was partly why they were elected. The OBA sold folks the story that they were better to address and manage our economy. Yet I still await to see a full plan. I did not see. planning in areas I thought the government pledged to cut back on. However, I did. see overspending on travel, capital projects, increased size of the C S.., etc…,

      This problems will continue if the government does not seek ways to generate alternative Revenue sources and Diversified our ecomony. Easy task…….No…….but a start is better than doing nothing……playing “Blame it on the PLP” doesn’t seem to be working Effectively either!

      Bermuda needs a Sage on Revenue Generation, yet government continues to reject it!,,,

      • BetttyTrump says:

        It wAs no big bombed shell……,,,,,,,.AS THERE IS NOT economic plan developed which would move Bermuda towards revenue generating ideas. …… can only anticipates that Mr Richards only solution is to borrow. What sad is that he promised he and only he had ideas to get Bermuda on a different track.

        When will the continued writing by Larry . Burchall. and the OBA take on a different narrative and focus be on growing our economy and Revenue streams……….that’s the only way out……..

        • Observer says:


          Your stuff posted here is the closest to sensible I’ve ever seen from you – but I’m still going to give you a thumbs down because you’ve trained me to do that on all of your posts!

          • BETTTYTRUMP says:

            @Observer I expect tumbs down from all the OBA supporters…..if you call their government out….their first reaction is to reject it….they blindly believe they must not hold their GOVT accountable, especially if one is not apart of their fan club. I know the dislikes are from those diehard OBA FOLKS…..BUT I CARE LITTLE OR NON….I will call it as I see it…when one calls it right seldom do you get support….

            OBA has fallen down on its management of the economy and based upon this article receive a grade F.

            Mr. Burchall a major cheerleader of the OBA continued attempt to write pieces to create fear in folks….or uses his condescending attitude that folks do not understand the economic realities. ….but in reality he should be working with his party to put forward solutions to reverse the backward falling of the OBA, more so their failure to address our failing ecomony.
            So I ask….where is the Economic Plan?

            I know what I write hits at the heart of the OBA fans, thus to click like would project their GOVT in a bad light….regardless the reality is what it is….OBA failure to improve our economy is smacking us in the face big time….

            1. Why do we need to borrow in less than 2 years when OBA and Mr. Richards promised us differently?

            2. Why has Bermuda’debt increased by 50% since the OBA leadership?

            3. Why is the GOVT false hope that by only making cuts, it will save our economy?

            4. Why has the government failed to examine alternative Revenues sources and diversified our economy ?

            So many whys
            ….yet we see this same path of Blame Approach only…as the problem gets bigger and No Solutions. ..

            So YES I expect OBA fans and diehards to click dislike……that’s what they do best…… I do not post for Clicks…I frankly do not care…

            • BETTTYTRUMP says:

              If the OBA fans swallowed the Canary and believe that CUTS is the only solution…..well we are more doomed than I thought…..there has to be alternative Revenues sources… away our largest revenue source the Airport…does little or nothing….really

              • Ringmaster says:

                Our largest revenue source is the airport? What a laugh. Please provide the numbers and facts versus that revenue provided by IB. You can’t, the best you can do is the PLP line of “diversify the economy” with no facts or details or cost/benefit analysis. What new revenue streams did the PLP create in their 14 years? The OBA is trying to get hotels built but the PLP/BIU are hellbent on preventing that. Presently all any Government, OBA or PLP, can do is cut costs.

                If the BTUC refuse to talk about furlough days or layoffs then it will be forced on them by the outside world. The payroll cannot be supported, not the massive benefits such as health and pensions. Without cuts to bring the public sector down to pre 1998 numbers the future is very bleak but the Union executive do not want to face it. It will be the members who will have to take the consequences. If you try and get the private sector to pay more they will quickly vote with their feet as has happened since 2007/2008. That means less revenue, a lot less.

                • BETTTYTRUMP says:

                  Here we go blindly defending the OBA…..ONE OF THEIR CHIEF DEFENDERS. ..REALLY. .go read up and get learnt it is clear your lacking factual knowledge but only defending for the sake of defending

        • Build a Better Bermuda says:

          And to think where we would be today if we had continued on the PLP’s lack of plan, or if by miracle they had won, changed leadership and gone with the PLP’s current leadership’s lack of plan.
          By the way, if Minister Richards didn’t have any sort of plan, why are we in a confrontation with the union right now about making sure the government can reach its planned expenditure reduction goals, to which we are in the second year of? Landing the America’s Cup will provide a stimulation to our economy for the next 3 years, an idea that came out of the Ministry for Economic Development, now Minister Gibbons needs to focus on what else we can develop in our environment to continue growth after that. They have passed the legislation for gaming to allow our hospitality industry to add one more element of diversity to our tourism product. There is interest for more companies to develop new hotels on the island than ther has been for over 4 decades… course I still maintain a stance of I will believe it when they build it, but at least it isn’t just one person, but about 3 or 4, increasing the odds something might actually happen

          • umok says:

            Bermuda is sinking. The outlook doesn’t look good either. Unemployment may cause high stress levels which could lead to further sickness and crime. If we don’t reverse the downward trend our government may not be able to pay the interest on the debt and our island will collapse economically.

            We need to stop thinking OBA vs PLP and start thinking BERMUDA. There has to be away to turn things around. We the PEOPLE need to fix the issues not government. We keep looking for government to fix the issues but they can’t. They can only change policy and that has limitations. Policy isn’t the panacea to our problems nor was it the reason behind our economic growth in 1998-2008.

            We need to come together and focus primarily on trade, business and tourism. We need ideas, innovation, and people to invest in Bermuda.

            We can fix tourism and get International Business going. We just need ideas from everyone collectively. We should not sit around and wait for the OBA to come up with the magical plan. The OBA nor the PLP can fix our situation.

      • Truth (Original) says:

        Even you don’t believe that drivel.

  2. SMH says:

    Scary stuff. Thanks Larry

  3. serengeti says:

    I don’t know Larry. Here’s another possibility.
    The last tranche was at 4.854%. Interest rates are no higher now than they were then. It’s possible we could borrow – say – $500m at under 5%, and use the proceeds to pay down the 2009 debt, and maybe the 2007 debt. That would reduce interest rate spend overall, and give us a bit more flexibility.

    • Girl on Fire says:

      Possible, but I’m not sure our credit rating will remain the same. We will be seen as even riskier than before, given that our economy has not improved since the last time we went to market and the previous borrowing ran out much faster than expected. Clearly our projections are flawed, which makes our ability to repay that much more questionable.

      I think that possibility you’ve outlined is overly optimistic. But markets can be strange, so you never know!

    • Larry Burchall says:


      Thanks for the comment and suggestion.

      In this new borrowing, the credit rating that Bermuda has – at the time of borrowing and for the near future – is the key factor. Not the ‘prevailing interest rate’ .

      That means that the interest rate will be determined on a different basis than the August 2013 borrow when we still had an A rating. It is entirely possible that going back to the market as early as Jan/Feb 2016, and so soon after taking up $800m, could find Bermuda with a lowered rating. Perhaps in the B grade.

      That lower rating alone might add two or three points to the interest rate demanded by lenders.

      This would mean an interest rate of 4.854% plus 2.00%/3.00% = 6.854%/7.854%.

      Now add the Sinking Fund contribution at 2.5%. You get 9.354%/10.354%.

      Those are the figures, the real figures, to understand and see.

      Do the arithmetic. Calculate 10.354% of $400m.

      Then tell me if you like the number that you see, especially after you’ve added it to the $166m + $30m = $196m Nanci that is already in place.

      By the way, going for the $500m that you suggest means raising the Debt Ceiling – again, and so soon after 2013. That would send a bad message that might be worth another 0.5% to 1% on the rate charged. That would move the top rate as high as 11.834%.

      Do the arithmetic.

      Larry Burchall

      • Creamy says:

        Interesting response. However Bermuda’s debt rating currently is AA-, stable outlook. To get us in the BBB range we would need a four -notch downgade. It could happen in theory, but is not very likely to happen before the end of this year, is it?
        Also, serengeti’s suggestion wouldn’t involve adding to the debt ceiling, as it contemplates paying down amounts equal to the new amount borrowed.
        As for your point about the sinking fund – again, that is being paid on the debt which serengeti suggests could be paid down using the new loan.
        The other advantage, not mentioned by serengeti, is that maturity dates would be pushed put.

      • serengeti says:

        We have a AA- rating, and have had it since 2012. Not sure why you think we are likely to have a multi-step downgrade, even given the events of this week.
        If the $500m were used to pay down existing debt everything you said about the sinking fund and the debt ceiling would be moot points.
        Do the arithmetic.

      • Build a Better Bermuda says:

        I think a question that hasn’t been asked is, is he planning to do this because they are going to be out of money from the $800m, or is he doing this because he knows that $800m isn’t going to get us across the finish line he set and is getting some extra as a buffer? As everybody knows, it near impossible to stick to a budget, especially with a lumbering bureacracy the is governments, this up coming budget will give us a clearer picture. The upcoming America’s Cup and being struck by 2 hurricanes this past season, will of course have reeked a bit of havoc to the plan the Minister Richards had developed a couple of years ago.

  4. Concerned says:

    Larry my Bye – you have just made my eyes, head and butt hurt… it isn’t a win win situation as CF thinks poor him it is US TOGETHER in a HELLUVAh situation.

  5. San George says:

    Don’t borrow anymore money Bob. Cut the civil service.


    • Boss says:

      Totally agree..start with those on work permits….lots of money there….if the hotels can do it and law firms than the govt must follow that formula….

      • Cardine Alice says:

        Culling work permit expertise won’t solve the bloated gravy train problem. Most are highly specialized providing international credibility in regulatory roles. And they don’t cost anymore than locals. And probably save money and reputation.

        Making people unemployed in a recession isn’t necessarily an end to civilization as we know it. Many countries have had collapses of economies which has lead to migration, with many returning with new international experience and qualification. And sending money back home to prop up the economy! Thankfully Bermuda has friends and passports that allow our youth to work elsewhere. That is a very fortunate position to be in that many other “economic exiles” don’t have.

    • Triangle Drifter says:

      Start with the non performers, no matter what level or how many years at the trough. Of them, the people who created & approved the unsustainable pension scheme should be first to go, after their pensions have been dropped to a realistic level first of course.

    • Build a Better Bermuda says:

      Unfortunately the only effect way to cut the civil service is through attrition, anything more drastic would produce a more negative effect to the overall economy than benefit to government expenditure reduction. Less jobs in the CS would mean less expenditure on the government books, but it would also mean more strain on things like financial assistance and less money going into the economy through items like basic services, utilities, groceries…

  6. Rockfish #2 says:

    As awful as this is. What else do you think Government should do under the circumstances?

  7. Family Man says:

    And we’re still spending $200-$250m more than we have every single year. How long will that $400m new borrowing last? Less than two years.

    And these clowns are bragging about saving $10m by not hiring the people they thought they were going to hire. Kind of like I just saved $10k by not taking that round-the-world cruise I was dreaming of.

    And now they’re “looking for savings of $6.5m” from the civil service. Even ten times that amount is not going to be enough.

  8. cromwell says:

    There are lots of solutions but apparently not politically acceptable and correct to the socialist culture of post slavery in Bermuda.

    Emancipation demanded responsibility and financial balance in both our personal and government life which takes discipline, physical and financial.

    In the present political environment where there is little trust and where political parties are distorting the truth it is very difficult to make rational financial decisions which will be acceptable to all Bermudians.

  9. sobbing_sob says:

    Larry. With a company, labor is mostly considered a variable cost. When markets/revenues fall, staff are cut. Can you explain how a company (in this case, a government) can perform when revenues fall but labor costs remain static. Any additional metrics you can provide around this in Bermuda’s case would be much appreciated.

    Thanks for your analysis. You paint a terrifying picture, and I hope people pay attention to it.

  10. Boss says:

    Why don’t we simply cut the number of govt employees, starting with the significant number off staff on work permits… paint a scary pic so let’s get to cutting..

    Correct me if I am wrong but I think the number of govt staff on work permits is 20% or 1000 opportunities to cut our expenses…

    • Terry says:

      Events of the past week speak volumes.

      And this was basically over “Furlough Days”.

      Imagine getting rid of 25/50-100 civil servants.

      I have seen Hamilton burn 3 times and been subject to it.

      I don’t think Bermuda needs that especially now when things are already hot.

      The horse is out of the stable.

      Time to get a round a big table.


      • Boss says:

        Not if we reduce work permit holders in govt ….lots of fat here

        • Ringmaster says:

          Not so simple. Less work permits = less rents paid (hits Bermudians) = less money spent in stores (hits Bermudians) and so on.

          Since both the PLP and OBA want to revamp Education the obvious answer is abolish the Dept. of Education which must be full of people pushing useless paper around (in between surfing the internet and chatting on cell phones) and replace some with teachers. Have a small Board to set the curriculum, and give the school Heads the responsibility to follow the curriculum. Rather like the private school system in fact. About $50 million saved there.

          • Creamy says:

            I agree. If they fired everyone in the Dept Education and let schools run themselves, I’d doubt anyone would ever be aware that anything changed.

    • Triangle Drifter says:

      Nice thought but what do they do? The assumption is that the jobs that they do are necessary & there are no Bermudians capable of doing those jobs.

      Get rid of the fat in the civil service, no matter who & no matter what level. There is plenty of it. The PLP increased the civil service by 50% since 1998 meanwhile the population has remained static.

      Among many other things the PLP pronised to reduce the already bloated civil service as it was in 1998. Look what happened.

  11. Excellent Analysis says:

    Mr. Burchall,

    Excellent analysis as always. You have been telling “we the people” this for years and your warning seem to go unheaded. This past week’s spectacle shows that we asd a country have decided to avoid your inconvenient truth.

    I sure hope that servcing our debt overhang becomes the topic of the day. What we seem to be avoiding is the truth of what heppens when we can’t say or as you say feed Nanci.

    The events of the past week appear from a financial perpsective as us trying to beat a dead horse or vultures picking at the bones of a decaying carcass.

    Again excellent, thoughtful and correct analysis Mr. Burchall. Thank you for taking your time to try to help us understand the enormity of our problem.

    Oh and by the way Miss Betty Trump–the blame for this situatio does and should rest firmly at the feet of the PLP administration–no one else–try spinning it to meet your fancy but the truth is the truth.

    Let’s tackle the debt.

    • BETTTYTRUMP says:

      Where has the blaming got Bermuda more so the government? Looks like NO No WHERE we are still faced with the same problem and moved NO where…….until you and the government are willing to have a mature conversation about our economy it looks like we will remain going down hill…..yes so much easier to play the “Blame Game”…..rather than putting real solutions in place. ….

  12. Double D says:

    Some should read the article yesterday about how a Barbados domiciled insurance company is now having to move jurisdictions due to the rating agencies cutting the Barbados Government credit rating. Under the rating agencies rules an individual firm cannot reside in a country whose credit rating is lower than the company’s. Keep in mind this particular company has been registered in Barbados for 170 years as well!

    The credit rating was cut, along with 3,000 civil service jobs, due to the government’s inability to get their financial house in order which in turn resulted in an emergency bailout from the IMF.

    Bermuda is not another world anymore and the above can be experienced here in the near future if we continue down the same path.

    • Boss says:

      20% of 5000 = 1000 work permits …..lets do a Barbados….

      • Triangle Drifter says:

        No, 20% of 5000 = 1000 jobs …..lets do a Barbados….

        Cut the fat not those producing.

      • Creamy says:

        The people to let go are the ones who are not worth employing. You don’t do it by age, height, nationality, race or sex. You do it fairly. You let go the people who are not doing a useful job.

  13. K.Smith says:

    People need to wake up! I do not envy the task that the government has to do to try and turn this around. On one hand we have to do some extreme austerity measures (cut expenditures and ultimately jobs). On the other hand if we do cut jobs we need new positions in the private sector so that we can get these and other unemployed workers into. The issue is that there is none and there continues to be job cuts. I think the goal should be, as I believe it is, is to increase revenue streams by getting more business to the island through tourism and international business. But this takes time. I believe if we start cutting now it only further reduces the government’s revenue stream and makes that debt to revenue and labor to revenue ratio look must worst and may result in a spiraling cycle. Do I believe it needs to be done, yes 100% but when is the question. And please note that I am not PLP or OBA, I am for the party that is able make sh*t happen. Hopefully this article opens the eyes of a few that we are in serious trouble and that if the boat goes down that we all sink together. The expats have a place to go back to if sh*t hits the fan. We do not! So people need to stop blaming the black man and the white man for their troubles and blame us as Bermudians for allowing our government to put us in this mess.

  14. I have to sayit….your numbskull behaviour is appalling to say the least…a girl is charge with importing five thousand dollars a maryjane…with a street value of one hundred thousand dollars….two states of the united states have a one hundred and eighty billiondollar industry !….and I think…where is your brain?….did you forget to turn it on today?

  15. Vincent Vega says:

    Mr Burchall,

    Excellent article. For your next article, may i suggest you describe “the end” of this farce? In other words, can you assist the public in knowing when default may occurr and the circumstances associated with it. The people need to be scared and aware of their reality.

    Vincent Vega

  16. De winna says:

    I know overseas Financial experts who have told me recently that Bermuda’s ecconomy was projected to take a
    hit and its financial structure would decline to the point of politcal and social Chaos’- its come true!
    Even our own ex Premier John Swan warned us several times about the changing global markets that will and have a negetive affect the Global ecconomy,
    The PLP has to be blamed for not paying attention to the financial forcast of the United States and Europe.-infect
    we were told as far back as 1996 that this day could come if we didn’t pay attention.
    The OBA have made a pre election statements and after election statements that it could bring back the ecconomy.
    but it hasn’t happened. — now that the PLP has been voted out for economic failure – all the blame must now
    go to the OBA – BECAUSE THEY SAID THAT THEY COULD FIX IT.– LOL – were about to borrow money AGAIN.

  17. bluebird says:

    Thank you Larry for keeping us updated on our continued dive to
    All those in the streets are the ones that will suffer the most.
    Government is costing more than the Government has in INCOME.
    The OBA has tried to save Government JOBS,but the local economy will not turn around with such heavy taxes and heavy regulations.
    The whole Island lives a fantastic life and life style,but we cannot continue to live this way on other peoples money.
    There will be a re-adjustment in the forseeable future and it will not be pleasant.

  18. Bermyman says:

    Slash the Civil Service, It is the only way, Hunker down and start to pay our debts back. The Government needs to bootstrap their finances and unfortunately the PLP voting Unions are the ones to take the hit. They allowed the PLP government to dig the hole and now they must pay for their ignorance.


    • Boss says:

      Yup, I agree.Let’s slash the civil service – There are tons of work permits that need yo be rescinded – I fully support this concept…

      • Triangle Drifter says:

        Fearful of your paycheck are you? Are you one of those who got a ‘job’ under the PLP & now it is in jeorpardy?

    • Things that make you go hmmm says:

      I’m sick and tired of people saying “we need to slash govt jobs” like it’s an easy fix. Please explain to me how 2000-3000 more people out of work is going to magically fix the economy? Financial assistance will be stretched to the max and crime and social ills will rise also. Of course I’m not saying our current situation is a sustainable one. Far from it.

      • Triangle Drifter says:

        People on financial assistance at a fraction of their former paycheck & benefits is a whole lot cheaper than having them on the payroll doing nothing, which is what we have now.

        Somebody please justify the 50% civil service inrease in size since 1998 without an increase in population size.

        Stop the bleeding.

        • Reality Check says:

          In case you haven’t been listening , the reason that the furlough day is important is that it reduces the cd payroll without actually firing people . It is in fact cheaper to fire people and then maybe pay them social assistance , than it is to continue their salary . However , unemployed people can’t pay rent , keep their cars running , etc etc etc , and that is bad for the economy as a whole .

  19. Mary says:

    Larry, you wrote an article in The Bermuda Sun some years ago where you explained in laymen’s terms how we ended up going from a position of virtually no debt to the debt position of $1.385 billion in March 2012. Can you post that article here please?

    • Larry Burchall says:


      Thanks for the question.

      I had a quick check and couldn’t find that.

      But on that particular line of thought, if you fast forward to and through December 2012, the Auditor General formally and publicly reports that the previous administration handed on Gross Debt of $1,505,000,000 [$1.505bn] with $97,141,966 in the Sinking Fund account for a net Debt of $1,407,858,034 plus an Overdraft of $69,000,521.

      So the final net Debt that was handed over or accounted for by the new administration on March 31st 2013 was $1,476,858,555.

      Contrast that with the net Debt position of $119,500,962 on March 31st 2004.

      It’s that humongous leap and addition of $1,357,357,593 [$1.358 billion], in just nine years that is so astounding.

      How did that happen, without some financial manager somewhere shouting and screaming – STOP IT!!

      Larry Burchall

  20. tom cooke says:

    Forgive me … for the sake of a dooms day look… what happens if we can’t or choose not to pay off the loans.. because of all the talk last week we are only saving chump change.. how many people will lose there jobs…

    • sobbing_sob says:

      give Furbs and JH a shout on this – they seem to have all the answers

  21. Reality Check says:

    There has been far too much political spin and finger pointing this past week . The BPSU is protecting their own interests . Everyone else , including the non civil service members of the BIU need to pay attention to Larry Burchall’s analysis of the real problem. The BPSU does not represent the majority of Bermudians . We cannot compromise our children’s future just to preserve the massive excesses of the civil service .

  22. Jimmy says:

    Bob hasn’t burned through all the cash. He was originally borrowing as he thought rates were going higher but also had a good piece of legacy borrowing that was short term variable. He now is doubling down and getting all fixed rate. His advisers were and still are clueless and costly but a stopped clock is right twice a day.

  23. EscapeTheDebtTrap says:

    Socialized bank debt and austerity could cripple the Devil’s Isles. This borrowing of fiat currency( because it is not ‘money’) is destined to be a bubble burst. Issue a promissory note(s). This so called austerity is unjust and completely asymmetrical. Worlwide, banks who recklessly lent have been bailed out, while taxpayers have been loaded with even more debt. Fiat currency is false. System is flawed from get go.

    Fractional Reserve Banking – banks create all new money in the monetary system via debt instruments, such as mortgages, government bonds, loans etc.

    They only create the principal, not the interest. So the money supply “principal” is always less than the debt “Principle + Interest”. Individuals that pay their debt and interest have actually dipped into the principal of another person. The system actively creates debtors.
    Private central banks print lend and distribute (money oops) currency as opposed to the treasury department that should be doing it (not lending), as the central banks are private institutions.

    The rich own the debt and the poor owe it. This is because money is a zero sum game, whereby if there were no debts there would be no money under the fractional reserve banking system.

    . Bermuda Inc. has transferred the debt from the ‘company’ to the household.
    Debt forgiveness would be a positive balance seeing that worldwide, banks are stealing from ‘we the people’ through ‘constructive trusts’ and the Roman practice of ‘pledging’. “Not one man in a million could figure this out but if so, we have the cover of plausible deniability.” -author known

  24. John Doe says:

    Larry, based all of this information coming to light, do you have any predictions for the budget in 3 weeks.