Not PC had the usual interesting commentary on the US economic recovery ….. of 2016
Of special interest are the two YouTube embeds there, the one with Peter Schiff being the most interesting, in talking about how interest rates need to go up to but cannot.
I recently took a look online at some fantastic houses near our old neighborhood, and where a couple of friends live. We could actually afford some of the $US 1million + homes, especially with fixed 30 year mortgage rates of 4.43%. It’s astounding – until you see the graphs of house price falls (the real estate sites are far superior to those of NZ) in that area and combine that with the likely income problems of the Chicago-Illinois economy and the tax burdens.
The Federal Reserve really is in a hell of a trap, but then so is the Federal government, and more than a few State governments.
Just a heads up on two issues you might find quite interesting in the Labour caucus.
1) Next Tuesday the union based MPs will challenge Goff’s position on the tradability of the 4th week of the month’s annual leave entitlement. There is general outrage that in an unguarded media moment Goff bucked the caucus and CTU position that the 4th week was not tradable for cash and essentially supported Key’s position. This issue has brought to a head the growing discontent in the caucus with both Goff’s leadership style and his poor polling. David Cunliffe has a big smile on his face and many in the caucus now expect a move against Goff and King before the election.
2) George Hawkins has been challenged in his electorate by a member of the Engineers union. Nominations close on 1 September. George is threatening a by-election and since the party is broke there is panic in the ranks over this prospect.
It’s interesting human behaviour isn’t it that sometimes people don’t want to look at the obvious both when it’s coming and also as it’s happening.
You’d think the collective genius that really is in Wall Street would click, wouldn’t you.
This is why I’m a very strong supporter of Key’s govt in the area of trade expansion in all directions. I believe we’re at the dawning of a global shift of power from US-UK toward China-Russia. I can well see Shanghai and Moscow replace NY and move into partnership with London as the new global financial power bases.
Tom Hunter an interesting video from that bloke Peter Schiff, I wonder how long it will take the Fed to work out that they have to bite the bullet and raise interest rates ?
More bank bailouts, hmm, that might just upset the normal peasant who has a pitchfork to hand
The amusing thing is we have some on this board who still believe we should have copied that system in it’s entirety.
I’m stunned grumpy, you’ve made a reasoned comment. May your day be better for it.
Personally I thought they should have let those banks crash. The premise underlying a free market is that if your business is viable and well run then it will succeed. If not it will die. Those banks that needed a bailout should have been left to die. They clearly weren’t well run. If the bailout money (well over $US 1 Trillion), or even a significant portion, had instead been given directly to American citizens it would have been a better stimulus method, as they would have put it back into the economy through spending (as you do when you’re struggling to pay your bills) .
If you happened to follow the blogs at the time you would have seen the left calling for NZ to follow the US lead for massive government stimulus. I’m glad we didn’t, as that stimulus would have been funded by borrowing, simply shifting the problem into the future.
A couple of Democrats have put forward a rather surprising article in the WSJ. They background themselves as follows:
The struggle for equal rights has animated both of our lives. Both of us were forged politically during the crucible of the civil rights movement. Having worked in the South during the civil rights movement, and on behalf of the ground-breaking elections of African-American mayors such as David Dinkins, Harold Washington and Emanuel Cleaver, we were deeply moved by Mr. Obama’s election.
I assume this means they’re not racists. Although that is questionable because their article goes on to say:
Rather than being a unifier, Mr. Obama has divided America on the basis of race, class and partisanship. Moreover, his cynical approach to governance has encouraged his allies to pursue a similar strategy of racially divisive politics on his behalf.
They cover the Gates incident in which “police acted stupidly”, and peer into a worse future:
Add in the lawsuit against the Arizona immigration law and it’s clear the Obama administration is willing to run the risk of dividing the American people along racial and ethnic lines to mobilize its supporters—particularly Hispanic voters, whose backing it needs in the fall midterm elections and beyond.
As the Washington Post reported last week, two top White House strategists, speaking on condition of anonymity, have indicated that “the White House plans to use the immigration debate to punish the GOP and aggressively seek the Latino vote in 2012.”
It’s the same with class warfare:
Mr. Obama has also cynically divided the country on class lines. He has taken to playing the populist card time and time again. He bashes Wall Street and insurance companies whenever convenient to advance his programs, yet he has been eager to accept campaign contributions and negotiate with these very same banks and corporations behind closed doors in order to advance his political agenda.
As good little Democrats they do manage to get some shots off at the GOP, but overall there’s a feeling of regret about the whole “hopey, changey” thing.
None of this is news to people who read right-wing blog-sites of course: it may be that even a Journolista like Jonathan Chait will wind up writing of Obama as he wrote in 2008 of another Democrat president, that perhaps the Conservatives had been …right about Bill Clinton all along?
It would seem that bi-partisan solutions will not be possible so long as Our Divisive President Obama is in the Whitehouse.
Somebody better tell Lindsey Graham before he finds his bipartisanship being rewarded with demonisation.
“The amusing thing is we have some on this board who still believe we should have copied that system in it’s entirety.”
The system isn’t the problem grumpy – it’s the fact both NY and The City failed properly to apply its well-known principles.
For years they allowed financial vapour to become the major part of the liquidity and its been downhill ever since.
Meanwhile they offshored not just manufacturing but also services thus creating what we see now. China can’t stop accumulating the remaining US’ wealth lest it falter, India keeps stealing its service base, Moscow as usual, remains perfectly silent. The situation is untenable and on top of that they have serious and expensive global security issues that they HAVE to deal with.
THEY got themselves into this situation: i.e. they didn’t have to allow vapour to infect the system and there were other ways to deal with 911.
It’s been appallingly mis-managed from start to finish. Starting, BTW, when Bush 41 came to power. And wasn’t he a nice young man. That’s George Herbert-Walker Bush BTW, not his more “successful” offspring.
RightNow funny that, when it was happening I was saying let the cards fall as they may, but others who are normally to the right were saying we could not let banks fail as they were needed for commerce to happen.
All I can see happening now in the USA is the Fed making up credit so that the banks can clip the ticket, and they say the USA has no aristocracy.
Yep, fully agree with the stimulus money, should have been given to people who would have spent it on services and goods they needed.
But, is the Fed completely fucking mad, allowing fixed rate 30 year 4.68% mortgages ?
Bet you a bottle of single malt there will be another large bank bailout as soon as the Fed puts interest rates up when the USA starts to act like Germany in the twenties.
I suspect the decision to bail out ‘critical industries’ (including General Motors) was less about political ideology and more about maintaining the status quo of the ‘ruling classes’. Politicians on both sides are recipients of largesse from big business, and I surmise that their own interests lie in keeping intact the systems they already know how to exploit.
Pete: “I don’t think “people who read right-wing blog-sites” have much to feel smug about. Divisiveness seems to be rampant across the board.” – are you including yourself in this? I include myself among “people who read left-wing blog-sites”.
I often feel a little smug, especially when I leave some in my pocket by mistake. I’m cutting down though.
Grumpy: “But, is the Fed completely fucking mad, allowing fixed rate 30 year 4.68% mortgages ?”
To be fair, much of the collapse was the result of adjustable rate mortgages that began with a low interest rate and after a couple of years the rate was massively increased. The new higher payments were impossible to meet and the borrower defaulted. Due to the expansion of lending to risky borrowers, as part of the drive to increase home ownership among lower income families, this had a massive effect – basically triggering the ‘GFC’. I think there are still a lot of these ARM’s in play in the US, which led a few pundits to predict a second dip.
If the US is to continue with the promotion of home ownership to lower income families, then that 30 year fixed rate is probably a better way to do it than with ARM’s. The government is already intervening in the market, they’re already in the hole for $13 trillion, at least this way will be less disastrous for those low income home buyers.
RightNow yep part of the problem was caused by wanting to get low income people into houses, but, million dollar homes when the people had a income of $30, 000, I did not believe it until some people blogged that they got into million dollar homes at starter mortgage payments of $100 week.
Working on the four times income which should be the rule even though we have gone through that, a person on a income of $30,000 should pay no more than $120,000 for a house.
And to me bloody banks have a duty to point that out.
But,jeez, people in the USA will go ape if banks have to be bailed out again.
“To be fair, much of the collapse was the result of adjustable rate mortgages that began with a low interest rate and after a couple of years the rate was massively increased.”
Grumpy the bubble started when Greenspan dropped the rates to zero following the dot-bomb bubble and consequently those losses were never worked out of the system. Then serious arbitrage occurred on top of that culminating in the ARMs and CDOs which were a perfect combination if you wanted to tank the system. I’m not necessarily saying that anyone actually set out to do that, but if they had, they did an effective job straight under everyones noses.
It all comes down to the truth, you get “nothing for nothing”. People speculating on property increasing in value without any additional value added. Financial markets trading bullshit between themselves with smoke and mirrors, producing nothing of value and providing no tangible service. Too many parasites, not enough producers.
The US may well recover from this but it will take 20 years. They need to go back to what they do best – solve problems, create, engineer. Let Wall Street implode the way it needs to. The world will turn and the vast majority of people wouldn’t notice the impact if Wall Street and the financial markets disappeared overnight.
The finance company disaster in NZ was a microscopic reflection of the same nonsense. Too many parasites, not enough producers. The parasites eventually kill the host.
“…the powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations.”
Professor Carroll Quigley
Tragedy and Hope: A History of the World in Our Time (1966)
President Bill Clinton’s Georgetown Professor
Chris C has the best of all worlds, He is his own travel agent. This week Tibet ,next week Santorini, the week after The Grand …. He decides ,selects and David Farrar and us,Davids posters pay and pay ,he never even needs to be in NZ doing his job as hes Chris Carter and he can now travel (ON THE SWEAT OF OUR COLLECTIVE BROWS), but he is still a nasty little weasle gay
The finance company disaster in NZ was a microscopic reflection of the same nonsense. Too many parasites, not enough producers. The parasites eventually kill the host.
Yes, we are in effect behaving like a pathogenic virus with all of this rampant greed.
My land lease is supposed to be going up by 600%. It is a ridiculous increase.
I had a big argument with Quotable value over it and they just keep repeating a whole lot of crap about market values etc. But when you ask them about market values relative to what they just go blank. It turns out that land values they are quoting are not based on anything other than theoretical land values, it is artificial and it stinks.
We are all expected to cover the collective arses of greedy bastards that are driven only by self interest, these people are opening the door wide open to socialist ideals but they are to damned arrogant to see it.
Sustainability of resources and markets is not a “greenie” ideal, it is just common sense.
Anyone ever heard of the conspiracy theory about Clinton being the illegitimate son of one of the Illuminati families? Can’t recall which one but either Rothschild or Rockefeller. Don’t know anything about it myself, but its always struck me as interesting the amazing connections and formative influences that almost miraculously arose for an anonymous young man from Little Rock, Arkansas.
Great to read Brian Gaynor in the NZ Hooerald today saying NZ should be debating migration and population growth… Contrast this with its economist-chatterer Bernard Hickey the previous day in the Hooerald. Hickey wrote:
The last thing New Zealand needs is another damaging debate about migration and race in an election campaign. Or at any time.
Read berween the lines. Hickey’s not saying a debate about population isn’t okay, just that it shouldn’t include questions of race and migration. A similar thing is happening in Australia, which has finally got around to appointing a Minister for Population. Only problem is, there’s no policy for him to administer nor does it look as if there’ll ever be.
Australia has – only just – reversed its decline in natural-born population thanks to Costello’s “baby bonus” and the commitment of both parties to things like subsidised childcare etc. But that only means things will remain static. Kevin Rudd wanted there to be 30 million people in the country… 10 million more than now. With static growth in the locally born population there’s only one possible source for that extra 10 million people… but the proponents don’t want you to wake up to that.
So they open up a debate about population (one which is vital to have, IMHO, before the decline in countries like Australia and NZ becomes almost irreversible) but add the rider that we mustn’t mention immigration or we’ll be being racist.
There’s nothing racist about questioning whether you want your country to consist of more than a third of people who weren’t born there, many of whim don’t share your values or embrace your lifestyle. Clearly Gaynor understands this, Hickey does not (or is peddling the message he’s been given to peddle).
Actually Rex Hickey doesn’t understand much at all. Fresh from trying to destroy property owners and failing he is now trying to drive interest rates to unrealistic heights. He is a Jouro who makes his money writing rubbish. Worse he did a lot of his learning in the bars in Canberra.
Aussie of course is a country that would barely exist but for immigrants. What they and we need to have a discussion about is not the need for immigrants but the kind of immigrants we really want. What their ethnic background should be for our society and what the rules for a new immigrant should be and the penalties for infringing those rules. How long those immigrants should be requires to stay crime free would be a good start. How long their residence should be before they are entitled to have a new passport.
NZ has a penchant for allowing in uneducated, health impaired people at huge cost to our social services. Services that are paid for by the taxpayer. Auckland DHB’s have a mountain of future costs just from diabetes alone from immigrants and many other DHB’s will be trapped in the same quandary.
Should we not insist that immigrants be healthy and prepay for their health insurance for however many years ahead.
Accidents and emergency are one thing but longterm health needs are another and when we have immigrants that arrive either bringing big families or having them and claiming benefits off people who work and struggle to provide for their own families surely its time to be a bit more Nationalistic.
NZ doesn’t need laborers for the fields, we need educated people.
Wage Gap With Australia No Surprise
By Hon Sir Roger Douglas
It comes as no surprise to anyone that the wage gap between Australia and New Zealand has widened by $40, to $580, per week – Labour’s policies did nothing to stimulate any growth for our country and the National Government’s policies are simply more of the same, ACT New Zealand Finance Spokesman Sir Roger Douglas said today.
“The Government must address four key issues if we are to achieve growth in real incomes – the first being to improve workers’ skills. Skilled workers are more productive, yet far too many students continue to leave school unable to read or write. A comprehensive reform of the education system which puts students’ needs first – as set out in ACT’s ‘Free To Learn’ policy – is needed to ensure a highly skilled workforce,” Sir Roger said.
“Experience is also crucial. Easing constraints to entering the job market – for example reinstating the youth minimum wage – will result in more young people gaining employment. This will enable them to gain experience, and set them up for a far more prosperous future.
“The second issue that must be addressed is capital formation. The Government’s wasteful spending on unproductive investments – such as KiwiRail and interest-free student loans – has seen little return on investment. This has stifled our growth. If we want to see real increases in our incomes, the Government cannot keep throwing money into poor investments.
“Third is improvement in technology. Sound investment in technology will result in huge productivity gains as we are able to produce more with less. Increases in technology investment will only occur when we have strong property rights and when the Government encourages private enterprise through regulation and low taxes.
“Finally the Government must improve our economic organisation – which can only be achieved by improving regulation and getting rid of red tape that restricts business unnecessarily. ACT’s Regulatory Responsibility Bill would go some way toward achieving this.
“If National is serious about closing the wage gap between New Zealand and Australia – as it claimed during the 2008 election – it must adopt policies that address these four key issues. Any failure on the Government’s part to do this will see the wage gap continue to grow,” Sir Roger said.
The Government’s wasteful spending on unproductive investments – such as KiwiRail and interest-free student loans – has seen little return on investment.
It’s too bad the 5th National govt and Liarbore always – both appear to calculate ROI primarily in terms of their own re-election and if the rest of the country benefit then that’s a plus. (As we all know that’s a rare side-effect.)
Newsflash Key: we’re not all fucking stupid. Get your ass into gear mate. Now. Drop that young naive press team who have no fucking clue and stop listening to market horse-whispers and start implementing hard decisions.
Hint: when the lefties start marching down Q St at lunchtime on Saturday morning, half the country is on strike and all the editorials are excoriating you and your party because they think you’re cruel and nasty, then you’ll be about halfway toward the correct solution. Welcome to politics.
Seriously, a very small handful ever get the opportunity to make a real difference and you’re one of them. You’re very smart, capable and very very lucky. Use your political capital to burn back the lefty mindset that cripples industry in this country. The entitlement attitude, the attitude that someone else owes me a living. Burn that back even a bit and you’ll make a lasting difference.
So far, your Administration has backed down on every single issue where its scented strong opposition and that wouldn’t be a bad thing if it wasn’t for the fact that on every single issue your rationale for pursuing the path was sound. No balls, Johnny. Grow some, now.
For interested readers, that naive young press team above comes from Hooten’s comments on RNZ Monday politics @ 11:20.
This week he said that apparently, “party central” originally was not intended to be a place where people had a beer but a showcase for NZ products. The public have never before heard this fact which is fucking crazy because if they had, then people would have been much much much much much more supportive of “party central!” Fucking d’oh.
Apparently Key’s press team consists entirely of young naive Wellingtonians who don’t understand how Auckland works and having lived in both cities I can confirm that understanding Auckland DOES require living there.
Now this is fucking nuts if true. A completely amateurish biblical-proportion cock-up of a critically important issue. From the PM himself. Fucking, fucking, fucking d’oh.
Key IS capable but new to politics which is a complex subtle field requiring a fill lifetime of study and even then you’re only entitled to wear short pants and have to sit at the back. Key’s had about five years. Based on his current performance with McCully and Brownlee as his chief political mentors, he needs to get some new ones, fast.
I’m not surprised old Pete thinks “they’re doing ok with most things”. Personally I think National and Pete are on the same wavelength. They are not sure what is hot or cold, left or right, up or down as long as they stay on the white dotted line and never waver from the center but keep left where necessary.
Good government isn’t about radical change as soon as there is a change of party in charge, that’s high risk and usually causes as many problems as it solves. Carefully researched gradual changes are much more likely to move the country in the right direction. By the look of the polls most people are happy with this approach. A few blog interlopers wanting a revolution will probably never be satisfied. I doubt that bothers the main political players.
“By the look of the polls most people are happy with this approach.”
Pete if you run the country according to what makes most people happy you’ll fail miserably as a politician.
Sometimes bad things have to happen in order to adjust for the longer term. That is something no-one wants but if it doesn’t the result down the road is much much worse. Think of it like you have cancer, and the longer you wait to present, the worse and more hopeless it becomes, even though you don’t want to present.
This is why politicians are paid and get free access to all sorts of research resources. To ensure that such doesn’t happen. They never get it right because they’re human and sometimes they purposely ignore it which also makes them evil, but this is precisely what they’re there for: to lead us into a better future. The fact most voters only ever focus upon a comfortable present for themselves, doesn’t change that duty.
“Good government isn’t about radical change as soon as there is a change of party in charge”
The usual unsubstantiated propagandising crap. British Columbia is a good example that governments can change things if they have the brains and the will and know enough not to be bothered by the never ending whining and wittering of fuckwitted commies like you PG . From the old Rocky Mountain News-
Black Thursday they called it. Government workers from around the province of British Columbia adorned black clothing and arm bands to protest the Liberal government’s slashing of over eleven thousand civil service positions province wide this last week. Some ministries – such as the Department of Highways – have been gutted – losing up to as much as 60% of their staff. Complete office complexes have been abandoned and redundant facilities such as jails and court houses have been shut down – permanently.
Gordon Campbell and the Liberal government swept to power last year (winning 77 of a possible 79 seats in the BC Legislature) on a mandate to set British Columbia back on the road to prosperity. Prosperity – as the Liberals promised – would be built on a platform dedicated to freeing the private sector from crushing taxes and burdensome regulation. Indeed, this last move by the Liberals to help cut 1.9 billion dollars from the budget by 2004 is just one thing in a list of many that has some wondering if the Liberals are actually Libertarians in disguise.
Campbell has even promised to withhold 20% of the salaries of both cabinet ministers and ministers of state until they are able to meet budget and service targets. This may be the first time in history a politician is actually forced to earn his salary?
Indeed, it is rare to see any government – especially in this day and age – taking a step back from the slippery slope. Not only have the Liberals adopted a policy of fiscal responsibility by introducing massive tax cuts (25% on personal income tax alone), reducing the civil service by about a third and reforming and reducing welfare but they’ve also made strides in increasing a degree of social and political freedom as well.
Just around Christmas of 2001 the Provincial government served their Federal Liberal counterparts with notice that the province of BC would no longer continue to administer nor enforce federal firearms laws. The registration center established by the former Socialist New Democratic Party in Victoria is slated to be shut down by about April 1st of this year. From there on the feds will have to deal with this dirty little mess on their own. And with hundreds of thousands and possibly millions of Canadians already in violation of the lisencing requirements, the future for this hideous law looks grim.
Add to that the elimination of photo radar, the return of the Grizzly bear hunting season which the NDP axed in the wake of European pressure (the season creates overall revenue in the millions of dollars for rural British Columbians) and a willingness to thumb their noses at powerful special interests and you have a recipe for something bordering on a quiet, clean and tidy little revolution.
In fact, it’s not just civil servants who were in for a shock last week. Welfare recipients in the Province of BC got a sudden wake up call as well. On top of closing 36 welfare offices across the province the new government has also come up with much more stringent welfare requirements to get people off the dole and back to work. In all, the BC government sent notice to some 60 000 welfare recipients informing them that they were employable and were expected to start looking for work – soon – before the tap gets shut off for good.
On top of all that the government has shut down twenty legal aid offices, twelve district forest offices, ten highways offices, eight correctional facilities, five probation offices, five energy offices, two residential tenancy offices, two coroner’s offices and one medical services plan office. Inmates in correctional facilities will be expected to double up to account for the cell shortage. Whole forestry departments have been shut down and relocated.
And of course all of this has the statists among us (and they’re still here) ranting and raving. In a MyBC interview New Democrat, Jenny Kwan (one of only two elected to the Legislature) complained: “It’s almost unbelievable, but Gordon Campbell has eliminated the ministries of Environment, Aboriginal Affairs and Women’s Equality, and there is no mention at all of housing,”.
Of course not silly – welfare is being eliminated from our society.
This recent move to reduce public ‘waste’ by the government of BC is a clear indication that the welfare state is coming to a crashing halt north of the border. If the Liberals have their way, by 2004, we will be 2 billion dollars closer to a balanced budget with greater economic, political and social freedom for all British Columbians. Indeed, we will be one step closer to shedding the idea that man should live in servitude to his brothers.
That means for all the delinquents out there who can’t do anything but push papers and play solitaire in their cubicles – it’s time to wake up, smell the coffee and get a real job. Because the free ride is over buddy and we – the producers of this society – don’t feel the least bit sorry for you.
Black Thursday my ass. They should have called it freedom day.
If only Redbaiter, if only. Meanwhile I see the dear Misss Gilliard has had some rather bad news. Latest poll results have her getting a serious arse kicking in the up coming election. It seems the Aussies can even smell a socialist, ” I’m full of leftest shit”, up wind. Perhaps one day, God willing, us poor Kiwis will also get our “freedom day”.
Redpointonepercent, I bow to the popularity of your ideas.
Reid, I more or less agree agree with what you’re saying, but governments also have a duty of care to not do things that are too great a risk. And like it or not they have to manage people’s reactions to changes, doing that successfully can make the difference between success or failure. Education standards are a good example of this, sure, they have a right to impose changes but if they don’t get those involved onside it will always be an uphill battle. Dealing with unions is another, ramming unpopular things through can lead to no-win situations.
People being happy enough with the government’s performance is different to keeping the people happy with reactionary policies.
It was when I had a hand in writing it, V2. Now “policy” seems to be “grab the baubles with both hands and hang on for dear life”.
The questions you raise are excellent ones and having a national discussion about them is not at all racist – after all, they’d apply to all immigrants regardless of race. But even suggesting that NZers have a right to determine the answers risks having you branded a racist.
I sincerely wonder whether those like Hickey, who don’t want to have that conversation, have considered the alternative. As you say, immigration is necessary for economic growth unless we increase our birth rate. So if we don’t choose whom we want to live alongside, we have it foisted upon us. There is no middle ground.
That choice can of course be made from a racist perspective, if you happen to be a racist. But simply demanding the right to make that choice is not, and can never be, racism.