NZs road to recovery. Great. Just the right thread then. This is it folks "Electric cars will be exempt from road user charges for four years, the Government said today as it moved to encourage people to use them." Now aint that a turn up for the books. I might be forced to stop rubbishing the govt. OK, how do I do a conversion on the old heap so I can drive taxfree. YES TAXFREE. for 4 years. I could save at least, 5 bob.
Come on Minister, don't chicken out now, scrap the gst as well and let's have us some real progress.

"Bollard said consumers and governments should save more and not to return to their big spending ways in a hurry." To encourage this, Dr Bollard has lowered NZ interest rates to historical lows. A huge inducement for people to save; and of course calculated to penalise profligate spenders to the max.

Its amazing that with such clear messages being handed out by the Reserve Bank, NZers have returned to pouring their nest eggs into housing, spiced up with generous servings of debt financing. Dr Bollard must shake his head in bafflement at this Pavlovian behaviour.

Obviously even monkeys can get the Swine.

W.Kunz you may have to stay at home.

W.Kunz : when will the great unwashed masses realise that LOTTO is a giant rort. Run by the Gumnut. Profits to the Gumnut, A small portion to charity, well and good. But basically, a tax on the poor and silly, too silly to do the math and understand the odds. God bless the great unwashed masses.

PHILLY I agree, Bollard should raise the rate, no point in dropping it...though there maybe no point in that either (as banks are apparantly raising deposit rates anyway).....businesses need low cost credit right now not mortgages...and they are not getting it from what I can read.

regards

http://news.bbc.co.uk/2/hi/uk_news/england/west_midlands/8105787.stm

flu is well loose.....

Anyone notice this from Denninger?

Eek:

In an edict released jointly by nine government departments, Beijing said government procurement must use only Chinese products or services unless they were not available within the country or could not be bought on reasonable commercial or legal terms.

Well, I can't say I'm surprised. After all, we did pretty much the same thing with our stimulus bill.

Of course this reminds me of a pair of gentlemen by the names of Smoot and Hawley.

For 50 points does anyone remember them and what they were best known for?

And for the other 50, what was the ultimate outcome of those policies and why might that be undesirable now?

this from
http://theautomaticearth.blogspot.com/

dairy farmers and exporters note #28

Stoneleigh: People have been asking how we see the future unfold. In case you wonder what we stand for, much of our view of what's to come can be found in the primers on the right-hand side bar. Here is an additional brief summary (in no particular order and not meant to be exhaustive) of the ground we have consistently covered here at TAE over the last year and a half, and before that elsewhere.

1. Deflation is inevitable due to Ponzi dynamics (see From the Top of the Great Pyramid)
2. The collapse of credit will crash the money supply as credit is the vast majority of the effective money supply
3. Cash will be king for a long time
4. Printing one's way out of deflation is impossible as printing cannot keep pace with credit destruction (the net effect is contraction)
5. Debt will become a millstone around people's necks and bankruptcy will no longer be possible at some point
6. In the future the consequences of unpayable debt could include indentured servitude, debtor's prison or being drummed into the military
7. Early withdrawls from pension plans will be prevented and almost all pension plans will eventually default
8. We will see a systemic banking crisis that will result in bank runs and the loss of savings
9. Prices will fall across the board as purchasing power collapses
10. Real estate prices are likely to fall by at least 90% on average (with local variation)
11. The essentials will see relative price support as a much larger percentage of a much smaller money supply chases them
12. We are headed eventually for a bond market dislocation where nominal interest rates will shoot up into the double digits
13. Real interest rates will be even higher (the nominal rate minus negative inflation)
14. This will cause a tsunami of debt default which is highly deflationary
15. Government spending (all levels) will be slashed, with loss of entitlements and inability to maintain infrastructure
16. Finance rules will be changed at will and changes applied retroactively (eg short selling will be banned, loans will be called in at some point)
17. Centralized services (water, electricity, gas, education, garbage pick-up, snow-removal etc) will become unreliable and of much lower quality, or may be eliminated entirely
18. Suburbia is a trap due to its dependence on these services and cheap energy for transport
19. People with essentially no purchasing power will be living in a pay-as-you-go world
20. Modern healthcare will be largely unavailable and informal care will generally be very basic
21. Universities will go out of business as no one will be able to afford to attend
22. Cash hoarding will continue to reduce the velocity of money, amplifying the effect of deflation
23. The US dollar will continue to rise for quite a while on a flight to safety and as dollar-denominated debt deflates
24. Eventually the dollar will collapse, but that time is not now (and a falling dollar does not mean an expanding money supply, ie inflation)
25. Deflation and depression are mutually reinforcing in a positive feedback spiral, so both are likely to be protracted
26. There should be no lasting market bottom until at least the middle of the next decade, and even then the depression won't be over
27. Much capital will be revealed as having been converted to waste during the cheap energy/cheap credit years
28. Export markets will collapse with global trade and exporting countries will be hit very hard
29. Herding behaviour is the foundation of markets
30. The flip side of the manic optimism we saw in the bubble years will be persistent pessimism, risk aversion, anger, scapegoating, recrimination, violence and the election of dangerous populist extremists
31. A sense of common humanity will be lost as foreigners and those who are different are demonized
32. There will be war in the labour markets as unempoyment skyrockets and wages and benefits are slashed
33. We are headed for resource wars, which will result in much resource and infrastructure destruction
34. Energy prices are first affected by demand collapse, then supply collapse, so that prices first fall and then rise enormously
35. Ordinary people are unlikely to be able to afford oil products AT ALL within 5 years
36. Hard limits to capital and energy will greatly reduce socioeconomic complexity (see Tainter)
37. Political structures exist to concentrate wealth at the centre at the expense of the periphery, and this happens at all scales simultaneously
38. Taxation will rise substantially as the domestic population is squeezed in order for the elite to partially make up for the loss of the ability to pick the pockets of the whole world through globalization
39. Repressive political structures will arise, with much greater use of police state methods and a drastic reduction of freedom
40. The rule of law will replaced by the politics of the personal and an economy of favours (ie endemic corruption)

This is whats happening in the UK

http://www.dailymail.co.uk/news/article-1193646/100-000-people-month-red...

please note this

Only the public sector was insulated - seeing an increase in overall employment by 15,000 to more than six million.

In stark contrast, private sector employment fell by 286,000 in the same period, to 23million.

Thats a recipe for revolt.