Persiflage & Paroxysm

I still tell the foreign investor to invest in Lebanon because I know it’s a good bet for them. We are a small country so our laws are geared to attracting foreigners and their money, convincing them to stay and spend. Our land mass is small so investment in real estate is a safe bet because there will never be enough land. Demand will remain strong, especially from the nostalgic (misguided) Diaspora who still believe owning a concrete, steal, and cinder block home is a good investment for their future and their children’s future. We have a well developed banking control structure, local banks are prudent and very conservative on risk, the interest paid on deposits is far better than neighboring Europe, and we still have banking secrecy, although how long this archaic and outdated concept will manage to hobble along amid an ever more hostile international financial climate that is demanding ever greater openness and transparency, is anyone’s guess. As for the wide-eyed, hopeful youth o

Monaco is just 2.05 square kilometers in area and has over $100 billion in deposits in its banking system. Lebanon is 10,452 square kilometers in area and has just $118.9 billion in deposits as off May 2012. The banking system we are so proud off seems a little lack luster now that it is compared to a tiny principality. To over simplify banking: Banks make their living from deposit inflows from our economic exiles’ paychecks, our hard working sons and daughters, those working in the Gulf or Africa because they could not find anything better to do at home, or because they found their hard earned skills were unappreciated. The banks then lend that money to the state and in the process make a good deal of money without having to work very hard. Of course, we DO work very hard to pay off the interest on the national debt with our taxes. The state takes the funds and agrees a budget that neither makes provisions to generate revenue nor agrees a proper spending plan to enhance and upg