The Economy

 

“Do you not know, my son, with how little wisdom the world is governed?”
Axel Oxenstierna

Count Axel OxenstiernerSwedish statesman Count Axel Gustafsson Oxenstierna af Södermöre wrote that to his son Johan in 1648. Young Johnny was feeling anxious prior to taking on an important European diplomatic job. Oxenstierner Senior pointed out that the world was—as it still is—run by people a lot less switched on than most of us assume.

It’s been all downhill in the intervening three centuries and I wish I’d cottoned onto the problem a bit earlier myself.

…each of these perspectives comes to the same conclusion, which is that our global economy is out of control and performing contrary to basic principles of market economics.
David Korten

Economics 101 from the few who understand

Around the world, those in charge are making a total cock-up of economic management. Here in New Zealand, then Reserve Bank governor Alan Bollard was paid $600,000 p.a. to declare the world’s recession over in 2008; Prime Minister John Key and Finance Minister Bill English have been regularly predicating rosy outlooks upon the overly optimistic forecasts of the same Reserve Bank. They’ve all been peddling fantasy ever since the financial crisis started in 2007. Here I’m posting snapshots from people who really understand what’s going on.

When the meltdown started in 2007 there was a cry around the world of “Why did nobody see this coming?”.

Well some switched on people did, including—forgive my immodesty—One Wild Kiwi. Not because I understood economics all that well, but because I know who does. Hardly anybody listened to the right people, in fact they were derided, abused, and often fired. They were of course correct and if you’d like to know what’s really happening here are some of those people whose views are of value:
Continue reading “The Economy”

I hate to say I told you so

But I told you soPoliticians are like diapers; they need to be changed often and for the same reason. Mark Twain

After the latest financial meltdown the cries were heard around the globe,

“Why didn’t anybody see this coming?”
“Why weren’t we told?”
“What are these economists smoking?”

We were told.

If you were one of those crying out, you were told. You just weren’t listening to the right people. You were told by Nobel Laureate economist Dr Paul Krugman; by Dr Doom, Nouriel Roubini; by people of integrity right here in New Zealand: Gareth Morgan, Colin James and Rod Oram.

Way back, before the New Zealand 2005 general election, the Wanganui Chronicle published a letter from me. I wasn’t prescient. I was just listening to the people who knew what they were talking about:

It was a relief to find that through your editorial column that our biggest problem has been addressed: the balance of payments. Neither the political parties nor the rest of the media are addressing the matters of most concern: what should we do to grow the cake so that we’re all better off 5, 10 or 20 years down the track.

Everyone’s excited by huge government budget surpluses. They’re blind to the fact that the balance of payments is massively in the red. It’s as if Mum has an extra thousand bucks in the housekeeping jar, but Dad’s putting the mortgage payments on VISA and spending the income at the pub and the TAB.

The major parties with their vote buying strategies are hell-bent on creating a big spend-up. They will exacerbate our already frightening deficit. If we’re to gain anything from having some of our money returned to us we must be bludgeoned into increasing savings, retiring debt and reducing spending.

The crunch will come. Don Brash knows it, Michael Cullen knows it. For short term political gain, or maybe because neither of them wants to win this election, they’re prostituting themselves.

A plague on all their houses.

Give me a checkbox on my ballot paper marked: None of the Above.

Those who cared to pay attention could see what was happening very clearly. And now we’re stumbling along at the mercy of the unprincipled and the incompetent. Politicians whose definition of integrity is whatever it takes to win the next election and our enlightened Reserve Bank Governor, Dr Alan Bollard, who declared the current recession over in 2008.

It’s a bit of a worry.

I hate to say I told you so

But I told you soPoliticians are like diapers; they need to be changed often and for the same reason. Mark Twain

After the latest financial meltdown the cries were heard around the globe,

“Why didn’t anybody see this coming?”
“Why weren’t we told?”
“What are these economists smoking?”

We were told.

If you were one of those crying out, you were told. You just weren’t listening to the right people. You were told by Nobel Laureate economist Dr Paul Krugman; by Dr Doom, Nouriel Roubini; by people of integrity right here in New Zealand: Gareth Morgan, Colin James and Rod Oram.

Way back, before the New Zealand 2005 general election, the Wanganui Chronicle published a letter from me. I wasn’t prescient. I was just listening to the people who knew what they were talking about:

It was a relief to find that through your editorial column that our biggest problem has been addressed: the balance of payments. Neither the political parties nor the rest of the media are addressing the matters of most concern: what should we do to grow the cake so that we’re all better off 5, 10 or 20 years down the track.

Everyone’s excited by huge government budget surpluses. They’re blind to the fact that the balance of payments is massively in the red. It’s as if Mum has an extra thousand bucks in the housekeeping jar, but Dad’s putting the mortgage payments on VISA and spending the income at the pub and the TAB.

The major parties with their vote buying strategies are hell-bent on creating a big spend-up. They will exacerbate our already frightening deficit. If we’re to gain anything from having some of our money returned to us we must be bludgeoned into increasing savings, retiring debt and reducing spending.

The crunch will come. Don Brash knows it, Michael Cullen knows it. For short term political gain, or maybe because neither of them wants to win this election, they’re prostituting themselves.

A plague on all their houses.

Give me a checkbox on my ballot paper marked: None of the Above.

Those who cared to pay attention could see what was happening very clearly. And now we’re stumbling along at the mercy of the unprincipled and the incompetent. Politicians whose definition of integrity is whatever it takes to win the next election and our enlightened Reserve Bank Governor, Dr Alan Bollard, who declared the current recession over in 2008.

It’s a bit of a worry.