The Editor, Sir:The absence of any rigorous analysis of the so-calle investment schemes is distressing.
Most of the writings on the subject seem based on some antiquated notions of investing and do not show a true appreciation of the different instruments and techniques which have evolved over the past two decades. Hence, the propensity to put all types of schemes in one basket, instead of analysing their feasibility, separately.
Any campaign to label all these schemes as ponzi or pyramid schemes would be an insult to the intelligence of many of your readers. The changes and the legitimate instruments available in the financial markets have been unappreciated, even by those who left business schools or studied finance two decades ago.
Old measures
The business techniques of finance is really for the practitioner and here our regulators are at a disadvantage as they try to use old and inappropriate regulatory measures to bludgeon investors.
Maybe the myriad interests could take the following approach:
(1) Separate foreign exchange trading clubs from other schemes. Be cognisant of the fact that many private individuals and groups are currently doing the same thing in their homes. (2) Educate the public on the true risks and rewards of foreign exchange trading. (3) The Government operates as an honest broker, takes a new and conciliatory approach to these Forex clubs and partner with them to establish suitable and appropriate criteria for their management and operations.Current banking regulations were heavily influenced by the inputs of commercial banks (4)Treat gains (allowing for write offs) as capital gains and not interest income.All of the above does not mean that I don't have serious concerns about the nature and potential viability of some of the new schemes.
However, the approach currently being taken seems to be biased in favour of the arrogant establishment, creates division and does not serve the national interest, to which we pay lip service.
I am, etc.,
SPENCER GILWYN
Kingston 8
