When the price of board and paper went sky-high (see the graph below) our three big forestry companies started making a record profits because they had huge warehouses of lumber and easy access to large swaths of forests, which they could use to make more pulp and board for Amazon and China at even higher prices. The three CEOs of these companies were regarded to be business geniuses we a few years over ever-increasing record results for shareholders and ever-increasing remuneration for themselves. The main national newspapers and the leading business magazines had big photographs on their front pages with stories pointing out that these wonder kids were contributing so much to the Finnish economy. To make more profits they closed down factories and laid off workers leaving the government to pay for the cleanup.
These three companies started cutting down huge volumes of trees from our own forests when Russia stopped delivering cheap birch and pine logs by rail (see photo below) because Putin was angry that Finland wanted to have better defenses by joining NATO.
The volumes cut were so huge that the international scientific community, and even the EU, started waving their finger at us saying that Finland’s carbon sink (our forests) is being depleted too quickly. It is obvious that older trees hold carbon, but not for long if the Chinese are wiping their bottoms on it, and newly planted trees take 30 to 50 years to become carbon vessels. What do the CEO’s care about climate change when they get a few million more…
Now that timber, board and paper prices have sunk you would think that these three business geniuses are still making record profits… but no. They are blaming the weak economy and the Greens, at home and aboard, for the paucity of their results… They are not geniuses but simple traders who would rather earn an extra dime at the expense of our natural resources. Forests are what clean the air of CO2 and stop the globe from overheating…
Bankers re not much different. There are three of them but two are big domestic monopoly pests. They have been receiving cheap funding for years from the EBC, our European central banking system, because the EBC thinks that banks have a central role in the economy and must stay healthy with taxpayer handouts. Don’t ask your correspondent why banks receive cheap funding because they do not need it with reasonable profits these last two decades.
Banks also pay very little or nothing for deposits but charge the full interest rate plus the agreed margin for all loans. In fact, when interest rates here were negative, the banks got the right from the authorities to avoid having to pay the negative rate to borrowers. Again, do not ask your correspondent has no idea why this happens, although some say that it may have something to do with banking generous payments to the main political parties at election time…
So, once again there are also big photos of these bank CEOs on the front pages of the main national newspapers and in leading business magazines. They must be geniuses too so long as there is no real competition for banking services.
Ops… we almost forgot to mention that every bank has benefited from generous support from taxpayers – they are still receiving cheap loans from the ECB, and depositors get next to nothing for their banking loyalty…
12-month deposit rates are around 4% and this plus a 1% margin is what house buyers must pay, but if you try to deposit money with a bank here for a 12-month period, they will only give you 1% if you are lucky. None of the main banks are offering any current deposit rates on their web pages. There is a total lack of competition and that suits these geniuses well.
