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The Macedonian Stock Convert (MSE) is not running successfully fap turbo robot. True, some of the parameters which we use to measure the success of a stock exchange have lately improved in the MSE. For representative, the annual money volume has increased together with the number of minutes. But this is a far cry from winner fap turbo robot.

Who is to blame? Is the current direction of the MSE rough?

I do not think so. Really, I think the MSE has an supreme management team, doing their best to united new dealing proficiencies and to list new firms fap turbo robot. The jobs lie elsewhere.

A stock shift is a very grand financial commercialise. It is a extremely efficient and visible instrumentate of financing. In the West, it is used to finance most of the takes of potbellies, way above financing accessible from banks. People and firms save some of their income and invest it. The stock switch is meeting grounds for savers wishing to invest their savings - and firms looking for investment funds.

Another function of stock substitutes is to assist governments in financing their internal taking up requirements. Governments deal obligations (called bonds) to investors through the stock replaces in their countries. A stock exchange is, therefore, an indispensable tool for re-financing subject debt.

But a few conditions must reign before a weak exchange functions properly.

The most essential condition is the macrocosm of a healthy, growing economy in the stock exchange’s country. Investors flock to robust economies and shy away from sickly ones.

On the face of it, the Macedonian economy belongs to to the latter category. High unemployment, low savings, retarded increment, a gaping trade and payments shortfalls. But this is an optical illusion. The economy is in much ameliorate conditions that most Macedonians would care to admit. The unemployment figures are inclined. They reflect causes to evade paying social taxes - not real unemployment. The economy is growing, even by official figures. The black economy is getting even faster. The deficits are covered by extended capital extracts from donor states. Macedonia is receiving more world mentions per capita than Russia. It is incessantly convenient to blame the declining economic climate - but the cold, objective figures do not bear this out.

When an economy is acquiring - the gains of companies (including those listed in the MSE) will grow with it. This makes the shares of these companies an interesting buy.

Since no one is buying - we must look for the trouble elsewhere.

A prospering stock switch is linked to the being of the right micro and macro economic management. Macedonia has more than its share of troubles in this value.

The process of translation of businesses with social capital had four basic flaws:

first, it introduced no new management, ideas or capital to the beleaguered firms which were “transformed”. The market simply does not consider that they were translated. The same people run the same shows under a unique hat.

Second, such transformation violates the construct of Hierarchy, a chain of bidding.

It blurs the distinction between labour (workers) and capital (owners). What is wrong with that is that a ship must have a skipper - and only one. Someone must have the self-assurance and the responsibleness. Collective management is no direction at all.

Moreover, innovation convert and revitalization are all prevented. What change could come from the same set of worn out managers? How can thousands of proprietors decide to worsen the shapes of the workforce - if possessors and labourers are one and the same? So, management is adulterated by tangential, non-economic considerations: power struggles amongst groups of workers, social considerations and political ones.

We identified one villain. The other one is high (real) interest rates. When involvement rates are high, three results keep the resuscitation of the stock exchange:

First, firms have high financing expenses (interest payments) - which contracts their profits. Second, it is not worthwhile to adopt money and to invest in shares.

Third, it is more tempting to invest money in bank deposits, yielding high interest rates - than in shares. High involvement rates are the poison of stock exchanges.

The same is true for low savings rates. If people and firms do not save - there is no capital available for investing in stocks.

This, exactly, is the current place in Macedonia : impossibly high involvement rates coupled with passing low savings. There is basic misgiving between clients and their banks. They choose other ways of keeping their money.

But all the above is far from depleting the list of pre-conditions for the proper functioning of a stock exchange.

Investors must have apropos, accurate and full selective information about the firms that they invest in. This will permit them to reply in real time to developments in the company and to prevent losses. This will also make it difficult to cheat them - which is were we come to the question of accounting standards. Only lately have the accounting rules in Macedonia been revised to conform to the Western systems of rules of accounting. Even now, the similarity is very slight. Macedonian firms maintain a double accounting system. One set of books is tax-driven. It is thought to show losses or benefits at the whim of the management. An elaborate scheme of hidden allows lies at the heart of the typical financial program lines of the Macedonian firm. Another set of books - if they are kept at all - meditates reality. This is an enormous barrier to foreign investment - and foreign investors are the driving force in every modern stock change.

The trust of investors in the stock substitute is based on legislating to protect their property rights against the firm’s management’ against the authorities and against other investors who might wish to rig the market or manipulate the prices of lines.

But legislation without an active judicial and law enforcement systems is like a stock exchange without money. To enforce dimension rights in Macedonia takes ages and even then the outcome is not certain. Laws, regulations are in their embryonic stage and some of them seem to have had an abortion: they were hurriedly and unwisely copied direct from legal codices of other countries (Germany, Britain).

Last - but definitely not least - is the creation of a fair, transparent and non-corrupt marketplace. The stock exchange, the banks, the regulatory authorities, the police and the courts have to be above suspicion. For the market to be utterly able - it must be utterly free of any ulterior considerations and motives. Corruption distorts the market’s allocative mechanisms and powers. It is well discernible in dealings in the stock exchange for all to see. A stock exchange is, after all, the showcase of the local economy.

But there is a problem which pillars above all other troubles and it is almost endemic to Macedonia. It helps to explain much of the predicament of the stock exchange in Skopje. It is the fact that the market is missing its most essential player: the Government.

Investors - both foreign and domestic - look for the Government to be live in the local stock exchange. Governments throughout the world use their stock exchanges to sell shares of state-owned enterprisingness to their public. The stock replace becomes a mechanism for the distribution of the national wealth - as embodied by the state owned enterprises - to all the citizens. As we said before, governments also use the stock substitute to borrow money from their citizens.

The Government of Macedonia does neither. It completely ignores the MSE. Not one company was privatized through the MSE. Not one Denar was borrowed from a Macedonian citizen through it. A government’s activity in the stock change is proof that the government believes in it. Therefore, if it does not operate in the stock exchange - it proves that it does not consider in it. If the government does not trust in the stock exchange in its personal country - why should the investors trust in it?

There are a few additional structural characteristics which are considered to be the trademarks of a healthy stock change. But those are the by-products of all the above mentioned conditions.

A stock exchange must be liquid so that investors would be able to convert their shares into cash easily and inadvisably. It must include many investiture options - professionally put, it must be varied. This will allow the investors to pick out from a variety of investments and also to reduce their risks by dividing their money among a few types of investments.

The management of the stock exchange can help it by presenting capable trading proficiencies, computerized trading and settlement organizations and so on. The faster investors meet their money when they betray their shares - the more they will be inclined to operate in the stock convert that allows them that. The easier it is for them to liquidate their assets by meeting buyers - the more they will choose to work in that stock exchange.

Investing in the stock replaces in the markets of the emerging economies has been an awkward decision in the last three years. Stock replaces from Russia to Hungary and from Lithuania to Poland have jeered wildly since the end of 1993.

They resembled a roller coaster in their performance, going up and down by tens of percents annually. There are exceptions to this rule. The Ljubljana Stock exchange, for instance. The dealing volume there has gone up 10 times since December 1993 - and the market capitalisation is up 30 times. But this is because of the performance of the general economy in Slovenia. In Croatia, the government is privatise its holdings in state owned companies by auctioning shares to the public through the Zagreb Stock Exchange. This has helped it a lot.