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Monday's Top 10 with NZ Mint; The crime of the century II; the war on house building; home equity grenades; unfunded pensions; "sustainable oil"; dairy oasis; Dilbert

Posted in Opinion

Here's my Top 10 links from around the Internet at 10:00 am today in association with NZ Mint.

Bernard will be back with his version tomorrow.

As always, we welcome your additions in the comments below or via email to bernard.hickey@interest.co.nz.

See all previous Top 10s here.

 

1. 'Crime of the century II'
The scandal engulfing the international financial industry is yet another sign that too many business leaders no longer respect the rule of law. David Rohde is on to it, and it is just a matter of time before voters turn the tables on the way the public policy is made and enforced. I have no problems with some people profiting (even handsomely) from good ideas and hard work, nor do I expect or want society to be some regulated egalitarin model benefiting freeloaders. But I certainly don't want lying, cheating, immoral thieves and thugs winning all the wealth by any means, and getting away with it. We need to ensure such behaviour is identified as criminal, and treat it as such.

I do not believe all bankers are evil. I admire business owners who innovate, create jobs and strengthen communities. But theft – whether the perpetrator is clad in a business suit or blue jeans – is theft.

And let’s not kid ourselves. Our ethical decay stretches beyond Wall Street. It spans industries, political parties and groups. In April, systematic bribery by executives of the U.S.’s second-largest company – Wal-Mart – was reported across Mexico. In June, American sports officials accused cyclist Lance Armstrong of engaging in a massive doping conspiracy. And Jesse Jackson Jr. appears to be the fifth member of Congress to be embroiled in an ethics scandal in two years.

Around the world, a globalized economy is creating planetary-sized profits – and relentless pressure. A May survey by Ernst & Young of 400 chief financial officers around the world found that a growing number of them were willing to pay bribes and falsify their firm’s financial performance to survive the financial downturn.

Even more troubling is that Barclays seem to have made a deal that in return for fessing up, they won't be prosecuted - in the US. James Stewart at the NY Times has the "too big to indict" angle. I hate deals like this. But this may not be the last word: from the same news organnisation is word that the US is in fact preparing to bring criminal charges against a range of banks, including Barclays.

2. New reality
Bernard caused a stir last week by noting that coffee bean prices have fallen sharply recently, as have milk prices - but the price of your latte hasn't changed. Things like coffee and milk are commodities, and they rise and fall in long cycles. We are expanding our monitoring of some important commodity prices, displaying them in NZ$ and US$, based on about fifty key series published monthly by the IMF.

Coffee beans are one of the items covered, and you can check the facts in detail about both Arabica and Robusta beans here ». It seems that for both beans, the high prices our merchants were paying recently weren't the high over the past twenty years, and the cycle has some way to go before it reaches its low. Chocolate (cocoa) prices are falling too.

3. Back from the dead
The Lehman Brothers failure was the trigger for the GFC. It was a huge shock. But consider this: it didn’t kill the company. Having emerged from bankruptcy in March, the 162-year-old firm now lives with one goal: generating as much money as possible to pay off former clients, creditors, and trading partners, ranging from Goldman Sachs and the Abu Dhabi Investment Authority to the New York Giants football team. Even this zombie-like existance is gigantically impressive in its own way.

On April 17, Lehman made its first payment to creditors, US$22.5 billion, which was 53 percent more than the company had said was likely in previous regulatory filings. Lehman has more than $21 billion in cash on hand now, though not all of it is available for the next payment, due in September. Facing claims of US$300 billion, the company estimates it will end up giving creditors US$53 billion, or 18¢ on the dollar, over the course of the next six years.

4. O' oh
There has been a noticeable improvement in the US housing markets over the last few months. True it's not linear, but the trend is improving for sales of both new homes, and existing homes. There are still deep problems with values with many being under water. But if the price and volume trends keep improving then they will slowly get out from under the burden. Or so you would think. But there is a new kicker emerging, surely to hamper any improvement.

The Semi Annual Risk Perspective from the US Treasury warns of the coming dangers of home equity loans.  During the initial years of home equity credit lines, borrowers must pay only interest. Borrowers can also pay down principal if they wish, but many homeowners, short on cash, haven’t done so. But these easy terms are about to get tougher. What’s known as the initial draw period for home equity lines of credit is coming to an end for many borrowers. Soon, they will have to pay principal as well. See page 20.

Approximately 58 percent of all HELOC balances are due to start amortizing between 2014 and 2017. Home equity borrowers face three potential issues: (1) risk from rising interest rates because most HELOCs are adjustable rate and interest rates have been very low (see figure 20); (2) payment shock because loans will move from an interest only period to fully amortizing; and (3) refinancing issues because collateral values have declined significantly since these loans were originated.

5. Affordability 101
As regular readers will be well aware, the New Zealand housing market has been strangled by regulation, to the point where it is impossible to build new affordable houses especially for first home buyers. Builders have abandoned the business, instead focussing on the much smaller high-priced end of the market where there is an ability to pay for all those imposts. (In NSW, their regulators are even considering just taxing everyone to pay for their rule-making.)

Just how stuffed it is can be seen by relating the level of new dwelling consents to the number of households in the country. There is an obvious relationship between the two - the more households, the more we need dwellings. In the absence of new building, we get this foolish competition for the existing stock. This chart dramatically shows the impact of the strangulation. We are doing nothing to reverse the trend, so who knows where it will end up.

6. Gulp!
I'm into really big numbers today and that means talking about China and the US. Sorry about that. But here are some really big and scary numbers related to the US pay-as-you-go Social Security system. Larry Kitlikoff, the US professor, who has make a career of stoking intergenerational tension, has pointed out some key work by the actuaries in the US Social Security Administration. Here is the key point: (yes, everything in this analysis is in trillions - and it's unfunded!)

Table IV.B6 is a long-run balance sheet for Social Security. It shows that the system’s US$88.9 trillion in liabilities exceed its $68.4 trillion in assets by US$20.5 trillion.

The liabilities are the present value of the system’s projected benefit payments, whereas the assets are the system’s US$2.7 trillion trust fund plus US$65.7 trillion in projected taxes, also valued in the present.

The US$20.5 trillion fiscal gap separating Social Security’s liabilities and assets - its unfunded liability - is enormous; it is 1.4 times U.S. gross domestic product and 34 times annual Social Security taxes.

 

7. China data doubts
Chinese economic growth is slowing according to data from the official Chinese statistics agency. But China-watchers are sceptical - they think things are slowing even faster. The FT has the story:

Doubts about Chinese data have a fine pedigree. Li Keqiang, who is widely expected to succeed Wen Jiabao later this year as premier, confided to US officials in 2007 that gross domestic product was “man made” and “for reference only”, according to a diplomatic cable published by WikiLeaks.

Mr Li said it was much more useful to focus on three alternative indicators: electricity consumption, rail cargo volumes and bank lending.

That advice has come back to haunt the government because electricity production has been unusually weak this year. Electricity output growth was flat in June, whereas industrial production – which accounts for about 40 per cent of GDP and usually correlates quite well to electricity – was up 9.5 per cent.

8. Sustainable oil?
The big growth in oil extracted from shale rock means the US will not need to import any crude within two decades, the former boss of BP has said according to the BBC. Lord Browne told a conference in Oxford, England, that the US would be "completely independent of imported oil, probably by 2030". He also said the amount of shale gas in the US was "effectively infinite". He said that the development of shale oil and gas was "quite extraordinary", and that the world was now entering the "latest age of primary energy".

Browne's message was probably not what the organisers really wanted him to say. It was an academic gathering of leaders promoting the message of scarcity - trying to ration "natural resources that are finite". Bill Clinton was the keynote draw. I bet they don't invite Browne back.

9. Phew!
The international dairy industry is in a mess - strikes, droughts, subsidies, 'insurance', and predatory supermarket buying policies are all buffeting the industry so hard, many farmers are in despair in most countries. But not in New Zealand, for some reason. Well, actually it could be "for good reason". Willy Leferink has some useful observations. Gird yourself for an envy attack.

10. Milton Friedman
It will soon be the 100th anniversary of Milton Friedman's birth. He effectively established the 'Chicago School' of economics, which had a huge influence in breaking down national barriers to commerce. Some say that effort has gone too far; some are continuing the work. But the one thing Friedman knew was that we need to constrian capitalists with rules and morals - it's not market capitalism when monopolies and oligopolies rise. It's a bit long for this format, but here is Milton Friedman at his most persuasive.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current Comment policy is here.

90 Comments

#9. Id give the guy a

#9. Id give the guy a D-.
 
 California milk producers council
 
In the first five months this year U.S. milk production was 3.5 billion lbs higher than for the same period a year ago and fluid milk sales were 0.7 billion lbs lower, a decrease of about 3.1%. The good news is dairy exports in all forms seem to be keeping pace with the additional milk production. 
 
 Manufacturers’ stocks on hand of nonfat dry milk were 53 million lbs higher this year than a year ago; butter (and other butterfat products) stocks were 94 million lbs higher; stocks of dry whey were 2.5 million lbs lower; cheese stocks were 20 million lbs lower. That is a mixed picture, for sure, reflecting the absence of a well conceived and well organized U.S. export industry that is made up of hundreds if not thousands of individuals and firms in many cases competing for the same business and sometimes not getting any of it. 

Keep beating the housing

Keep beating the housing drum, DC.  Because Godzone has now achieved the full four conditions for a Housing Cartel:

  • Land banking in response to -
  • Land lockup and regulatory craziness by economically clueless TLA's
  • Cheap credit (by historical economic norms) which tips petrol on the fire
  • And of course licensing of residential practitioners, and by trade - the re-creation of Mediaeval Guilds, no less.

 
So to turn things around, it would be necessary to inflict three types of loss, on various powerful groups:
 
- loss of unearned capital gain on land being banked (recall that your average 600 sq m section at dairy-land prices of $30K/ha, is worth $2,600 allowing for 30% in roads and reserves)
- loss of power by myriads of clip-board-toting regulatory minions within the TLA's, DBH and other economic deadweights (let's elide the terms and call them 'deadbeats')
- loss of market position by the new overlords of the building trade guilds, plus the materials suppliers (recall there's a Duopoly in materials...)
 
One way out might just be to go all-out for factory-built houses:
- great QC possible
- cuts out the Guilds
- economies of scale (see the Productivity Commish)
- type approvals from the stoopid TLA's
- but it still leaves untouched the Land Bankers and their enablers in the plannerating and zonifying departrments of the TLA's....
Class of 2012 - Discuss!

And of course licensing of

And of course licensing of residential practitioners, and by trade - the re-creation of Mediaeval Guilds, no less.
 
I don't know about re-creation - they are fully fledged and operational in the UK. The Renumeration Authority, New Zealand Medical Association etc. are guilds in purpose. 
 
Irrespective of nomenclature the barriers to entry have just risen/got harder. Read this article.  

Not sure why you're so upset

Not sure why you're so upset about residential building practitioners being forced to have some rudimentary knowledge of the building process.  Sure you may have to pay more to have someone slightly compotent to do your building work - but it's half the price of rebuilding 5 years down the track when the shoddy workmanship by cheap clown builder has started to rot and fall apart.
 
You wouldn't buy a car which had zero research/development or safety standards put into it, just 'cos it was 10% cheaper than a proper one.  You wouldn't visit a self trained unregulated doctor or dentist 'cos they were a bit cheaper.  Why are people so keen to have the cheapest, most incompotent twit to design and build their biggest investment?
 

Bob - who designed, approved

Bob - who designed, approved and signed off those leaky buildings? Professionals, and a good number of Master Builders, is who. The only house-build I ever 'potted' to the Council (even then I was nice about it, didn't want 'guts for garters', just the issue sorted out) was by a Master Builder. Skew-nailed balustrade through monlithic cladding, apparently sans wrap/paper?

Those who were willing to do

Those who were willing to do the cheapest job.  My point exactly.  Not professionals - 'professional' implies a 'profession' - minimum standards required to be part of profession and protected from unregulated competition etc.  Any profession that is completely unregulated (like the NZ  building industry in the 90's and 00's) is not a profession.  Master builder is just a marketing term.
Council 'signing off' buildings is a classic.  No one can inspect and make sure that buildings are built to code for the price that council's charge to do that job.  They have undercut everyone who could do the job properly, done a shoddy job and ratepayers/taxpayers will pay for it.   

A bit paranoid.   I'd rather

A bit paranoid.
 
I'd rather go to a doctor that is qualified and regulated than go to one that isn't - no matter how much they assure me they are 'top notch' and medical qualifications are just an unneccessary fee collection exercise.  I'd rather have a car that meets some safety standards than one that the manufacturer tells me is safe.  That's like trusting banks to ethically self regulate etc.
 
How is someone with no knowledge  of the construction industry going to tell the difference between builders who all claim to "have a lifetimes service, have taken extra care and top notch materials and processes, even served under a succession of master tradespeople."?  They all claimed that in the 90's before building shoddy leakers in the scramble to provide the lowest price in order to get the job.
 
If you want unqualified designers and tradespeople building your house that's fine - but when it leaks or collapses that should be at your risk - don't suddenly expect the same recourses you'd get if someone qualified and licensed had done it. 
 
 

So because you had a bad

So because you had a bad experience etverything should be deregulated and anyone should be able to have a go at anything - even if they've got no qualifications.
 
Hang on - then you start going on about how there should be apprenticeships (what is that if it is not proof of competence - qualification)
 
 

re 8 - actually, those who

re 8 - actually, those who would ascertain what the truth might be, are more likely to invite contrarian views.
 
Only those who have a pre-held wish for a certain outcome, shut down the debate.
 
http://www.energybulletin.net/stories/2012-07-15/energy-economy-and-impending-rite-passage
 
http://www.energybulletin.net/stories/2012-07-15/energy-economy-and-impending-rite-passage
 
Browne has a pre-held wish for a certain outcome. He's not the only one..........

The Keiser Report is a good

The Keiser Report is a good place to get info on Banking corruption.
Ian Fraser explains the history behind why Banking regulations are not enforced in the UK
http://rt.com/programs/keiser-report/episode-313-keiser-max/
Ron Kirby talks about Libor and other price fixing schemes. The Libor price fixing is only part of the fixing that goes on in the Global Financial system.
http://rt.com/programs/keiser-report/episode-314-keiser-kirby/

8. Why use the word

8. Why use the word "sustainable oil"? its an oxy-moron. Otherwise this would imply re-usable into the far future...it isnt. Organically produced bio-deisel is probably sustainable. 
Even if the myth of US oil independance was true and looking at the EROEI it isnt....thats only the US....so they will be fine (they wont) but little NZ is still screwed...funny as.....not.
regards

Some people swallow the

Some people swallow the nonsense uttered by Bjorn Lomborg. Some believe in sustainable finite resources. Sometimes they're the same folk.

'Sustainable' should always

'Sustainable' should always be accompanied by the qualifying phrase 'at xxx level of existence'.
'xxx' is best illustrated by example:

  • hunter-gatherer, no metals
  • agriculture but still no metals
  • agriculture plus metals
  • small cities

Y'all get the drift.  (Oh, my bad, that's a Mining term...)
 
So, please, nominate what phase of human existence, and perhaps (if'n yer inclined to be accurate) a recent century, so as to indicate that all-important Level of Comfort at which ye reckon we can be Sustained.
 

I'll bite.   Aim for a global

I'll bite.
 
Aim for a global population of 2 billion.
 
Keep NZ's capped, allow 2 per womb, and collect attrition as a bonus.
 
Keep communication technology, keep what passes the 'sustainable' test, and triage the rest.
 
Educate folk so they know what they're part of - buy-in is the only way to avoid angst.
 
Start now.

Hypertiger is one switched on

Hypertiger is one switched on fella, one of the best. His comments there come from his latest article http://hypertiger.blogspot.co.nz/2012/03/just-lie-back-and-enjoy-mind-rape.html Interestingly what he describes in there is exactly the conclusion I came to with that equation of mine (M.V)+i=P.Q. When you plug some numbers into it you can see that interest in the mechanism through which the wealth redistribution takes place, he just talks about it as yield.
 
I book marked something else hypertiger wrote but the link delivered me to his latest piece. It is worth going through and taking a look at his other pieces.

the Grizzly Bear gets it :-).

the Grizzly Bear gets it :-).

And how exactly do you

And how exactly do you propose to get to 2 billion ... wait is that advertising for pdk branded suicide pills I see?

Tell me if someone broke into

Tell me if someone broke into your house aiming to steal your food what would you do?
Its almost certainly too late now to do that by any "sane" method, so mother nature will do it for us....thats rioting, anarchy and violent death......she really doesnt care.  NZ with 4million might be a lifeboat, however lifeboats get swamped...so it might be machine guns on the beaches...nice thought that.
regards
 

1st para, oil only gets made

1st para, oil only gets made in super-warm periods (from memory) so we have had two?   Look on the bright side we are so screwing the planet that by about 2150 we will have started the third, lucky us. On the other hand humans wont be around to enjoy the new oil of course...we will be long extinct.
For population, in terms of food, the 1920s, we had about 2 billion....but it wouldnt be that "bad" due to advances in learning/education/understanding...I hope...
That would be one graph....the crossing point indicating the approx date.
You would then have to do the same thing for energy.
and any other relevant raw materials.
regards

More ppl consume more....so

More ppl consume more....so yeah we'd have a bigger GDP until the systems underneath buckled/ran out, then we'd be even poorer.....
Which we are hell bent on achieving it seems, makes no sense.
regards
 

You just described

You just described 'Overshoot'.

Re 6 My understanding is that

Re 6
My understanding is that all pensions are essentially unfunded in that whether it is a state pension- National Super - or a private scheme all pension money must come out of current earnings. Current Earnings is where everything comes from. There is no pot of money just sitting there. In the end all pensions are paid by people working today. Thats it. There is no one else to pay them. No Martians, just us.  The crazy deal that we are doing in NZ at the moment is to underfund workers/businesses  in NZ* and instead invest the money in offshore workers and hope that they will continue to want to pay our pensions.
 
* The underfunding cane be seen in our productivity numbers- not good- I
 

Plan B - I am glad someone

Plan B - I am glad someone else is thinking this way. 
The Modern Money Theorists at least acknowledge the issue in the terms you have mentioned.  See Bill Mitchell : When 50 per cent youth unemployment is (apparently) protecting the grand kids  at http://bilbo.economicoutlook.net/blog/?feed=rss2  - it is very long but the  important bit to me was this commentary on an item by Niall Ferguson who was running the same argument as Larry Kortlikoff:
The only problem is whether the US government will be able to provide the real standard of living that the future generations expect.
The US government will always be able to purchase whatever real resources are available for sale in US dollars in the future to fulfil any medical and social security obligations.
That is not to say that the US health system is not in need of serious repair on efficiency and equity grounds....
But that is quite a different line of argument than focusing on the “US government will go broke” lie. The challenge facing the US is not financial. It is to ensure productivity grows fast enough to meet the challenge of the rising dependency ratio and the political demands required to divert real resources from one generation to another. But the political challenge is no different to diverting current resources between competing groups.
 

Private schemes take in money

Private schemes take in money and invest for profit....otherwise what you are describing is a ponzi scheme.  Public pensions use tax hand to mouth so its a pot of work rather than money which is OK as long as there is no bulge in population and we are on a sustainable path....ie we can do it for ever....we clearly are not.
Offshore, totally agree, however who in NZ is buying NZ  goods?  I try to where I can but mostyly I cant affford to, there is no such option and when you see "packaged in NZ" using nz and other un-named ingredients you just know you are getting screwed over by the immoral.
Thats one of the problems of importing foreign business ppl, they bring their (lack of ) morals with them...
Problem with investing in productivity is because NZ is so small we get screwed over for automation....ie high prices and our labour is cheap....it usually doesnt add up.
For instance I looked at a monitoring product, it was $20kUSD on 50% special so $10K USD when bought over teh Internet....when I tried to buy it off the web site I got re-directed to OZ where they wanted the full USD price converted to AU plus a fat margin, in NZD it was in excess of $50K v $14KNZD when converted directly....I still get spammed monthly from them despite asking them to stop....doh.
regards
 

Facts are, I know, boring but

Facts are, I know, boring but have a look at the paper "PensionCommentary 2012-3: We all have to talk about New Zealand Superannuation" at http://www.business.auckland.ac.nz/uoa/home/about/our-research/bs-resear...
It discusses the projected pension costs as a % of gdp.  The numbers may be lower than you think. 

Andrew R, thanks for that

Andrew R, thanks for that pointer.  We do need to take care that we do not transfer the US position to New Zealand because the "entitlements" are quite different.  Social Security in the US is unfunded, as is our National Superannuation,  but if you look at this website  you will see that for an American " benefit payment is based on how much you earned during your working career. Higher lifetime earnings result in higher benefits".  In comparison our system offers a more basic benefit which is tied to the average wage. 

It is arguably fairer to have

It is arguably fairer to have a more basic benefit than one tied to earning as there are many in society who for legitmate and desirable reasons (e.g. motherhood) do not "earn" all their life.

Absolutely.  As a person who

Absolutely.  As a person who has made a contribution to family and community that is not measured in our national statistics I benefit from that.  Another advantage of our system is that if the average wage was to fall then pensions should retain relativity.  On the American system current high earnings are entrenched at a time when many  new entrants to the workforce are entering with reduced wages and conditions.

The accuracy of NIWA's

The accuracy of NIWA's official temperature records are being challenged in the High Court in Auckland.
The New Zealand Climate Change Education Trust is disputing the method NIWA uses to measure the temperature.
At the heart of the case is whether temperatures have risen to the degree NIWA data claims and whether that warming is predominantly caused by human activities.
The trust wants New Zealand's official temperature records to be declared invalid and prevent NIWA using that data to advise the Government and public.
It's also seeking an order that NIWA produces full and accurate temperature data.

 

This will be the continuation

This will be the continuation of the August 2010 opening volley. The trust was formed days before the court papers were lodged, by the same people behind the existing NZ Climate Science Coalition- leading one to wonder to what extent the Trust might have been created as a lawsuit vehical given the timeline.
I see the Flat Earth Society have been outside the court trying to convince the Climate Science Education Trust to join with their organisation.

Ah right, legal expenses

Ah right, legal expenses limitation strategy I assume....make it a not for profit so pay no tax and keep its liabilities away from the sponsors....who otherwise could be held accountable....so much for confidence in thier case.
regards

OMG, Is this what you are

OMG, Is this what you are defending??
Court case against NIWA
http://www.climateconversation.wordshine.co.nz/2012/07/four-go-a-court-with-a-hey-nonny-no/#more-14293
 
The Coalition’s second cause of action is the 11SS. This was the temperature series hurriedly cobbled together in rebuttal by Jim Salinger and James Renwick after we published “Are we feeling warmer yet” — the paper that started the controversy over the national temperature record.
It was funny, though, because we said what are the adjustments and they said of course it needs adjustments. We went: huh?
Anyway, Terry quoted from the email in which Jim Salinger informed James Renwick, at NIWA, that these 11 weather stations were “pristine sites” and therefore formed an ideal temperature series to support the 7SS, which we’d criticised.
Then he itemised its deficiencies. Only three sites began in 1931 and it wasn’t until 1955 that all 11 existed, so they don’t constitute a series. Several stations (I think about five of them) had multiple years with multiple missing months; the literature specifically says such stations don’t constitute a series. The majority of sites were far from pristine — in fact, some were unusable.
When the methodology of Rhoades & Salinger (1993)(RS93) is used correctly, the warming claimed plunges to about 0.28°C (I think!) per century.
Terry described the criticism NIWA offered of Bob Dedekind’s statistical audit of NIWA’s 7-station review. They made two points:
1. He was too strictly formulaic and too rigid in using K=2, or two years before and after in comparing stations. Terry mentioned he had set out specifically to use RS93. I think he meant it’s little surprise he therefore used it consistently.
2. He had an incorrect approach to missing data. I didn’t catch NIWA’s argument here.
NIWA had no problem with Bob’s calculations or the principle of his using RS93. Even with NIWA’s criticisms, his paper shows they make sufficiently significant mistakes in calculating the new temperature series to justify a remedy.
After finishing with the scientific matters Terry moved on to legal issues. They refer to the legal responsibilities and status of crown-owned entities.
1. Is the pursuit of excellence an enforceable duty or something less than that?
2. In research, is good quality mandatory?
3. In the pursuit of excellence, what is the effect of a breach?
4. Mistakes of fact (I’m unclear what this means).
5. The effect of unreasonableness.
6. Whether or not a recent decision concerning Mercury Energy has any effect here.
Some of these questions seem astounding. For example, why do they seem to be considering “good quality” as an optional extra in a scientific research organisation?
The matters arise between the plaintiff’s (the Coalition’s) Statement of Claim (SOC) and the Defendant’s (NIWA’s) Statement of Defence (SOD). NIWA counter-claimed they had no obligation to pursue excellence or to use best-quality scientific practices and also that the national temperature record was not only not official, but they themselves had no obligation to produce or maintain it.
Never mind that nobody else had one, or that every time NIWA needed a national temperature record, say, in official court testimony, or at a planning hearing, or to answer questions in the Parliament, they pulled out the 7SS. It still wasn’t theirs and they still have no duty towards it.
Incredible.

I think this answers PDK's

I think this answers PDK's question.
 

Whatever  -  pretty clear you

Whatever  -  pretty clear you champion shoddy science. Since the truth gets up your nose I'll make a point of posting updates.

Please do, and if you could

Please do, and if you could make sure you include all your sources, just so we can check you are not spinning the facts. I will be accepting your full appology when the court draws its conclusion. Can we assume that you consider the court a fair test of NIWA's integrity at least? Or should we wait to see the result before drawing such a conclusion, in your opinion?
Please do note the previous author decided that fraud and shoddy science are interchangeable terms.
 
 

Sure, I'll apologise right

Sure, I'll apologise right now, 
"Sorry NZ that climate activists have captured the scientific process for their own political ends as evidenced in climategate emails and the shenanigans of the IPCC and that the likes of apologist/activist Nic will do anything they can to hide this . Of course the judicial system is not always beyond political interference and we hope that in this case this does not occur"

How are we going to judge if

How are we going to judge if political interference has occured, by the way? Would its existance entirely depend on a favourable result of this case? Or is there some other way of knowing it has occured? Maybe we should just take your word for it? No, actually I am not very partial to that idea, I won't be taking your word for it.
Remember what I said about references. As far as we can tell the "climategate emails" and "shenanigans of the IPCC" have only occured in your head. I know it appears that these ideas are not appearing in other peoples heads because I am hiding this from them (and they forgot to wear their tinfoil hats), but its actually because other people can't verify them independently and so they don't believe you.
 

To quote you.   " I will be

To quote you.
 
" I will be accepting your full appology when the court draws its conclusion." 
 
So you already know the outcome, how prescient of you, LOL.

Thats right, be very afraid,

Thats right, be very afraid, I am either prescient or omnipotent. I even know you are going to be big enough to appologise, you have to be asking yourself, which one of your thoughts am I controlling right now.
Damn, but now you know that the outcome is a fix.
 

Well at least we can both

Well at least we can both laugh at ourselves, but govt policy based on an activist agenda is not a laughing matter though - sleep well Nic
Cheers.

Another log on the

Another log on the climategate fire.
http://www.youtube.com/watch?v=gPFdhxBbHX0

Now I want you to watch the

Now I want you to watch the whole thing, and then also to ask yourself why there is an abridged video on you-tube. What other testimony was in the un-edited version? And why did this author of the video decide it was important to highlight a couple of statements. Why did he leave out the statements he didn't include?
http://www.youtube.com/watch?v=cAj_lZv4Gxc&feature=related
 

1 & 2) Do business men say

1 & 2) Do business men say follow excellence or do good enough to make a profit and gather enough information to do that? 
In terms of risk managment the data especially when you consider all the global data concurs is good enough to consider mitigation......on the other side of the argument are the deniers with really no science at all.
So NIWA provides the best data it can as long as Pollies know this and its limits they should make good judgements, of course they are not.
Hindsight is 20/20 as they say.
Im not sure here which bits are your opinion or actually what was said....please be more rigorous, also cite URLs.
regards

We can look forward to a

We can look forward to a statement that the NZ justice system has joined NIWA in the climate conspiracy in the near future then.
 

Just like Justice is working

Just like Justice is working for the banks and real estate agencies now http://www.interest.co.nz/rural-news/60146/bronwyn-howell-highlights-important-legal-principles-which-crafar-farms-case-depend
 
The crux of the matter is whether the decision itself will alter expectations regarding future transactions: in which case the appropriate counterfactual is what will occur if permission for the proposed transaction is declined. The Pengxin/Crafar example again illustrates this.....
 
.....Although lower-priced farms might be attractive to prospective buyers, a decrease in values is costly to all existing farm owners: they now anticipate receiving less when selling and can borrow less for capital improvements.
 
I am surprised more people haven't picked up on this.

I think there are some subtle

I think there are some subtle differences, the question is scientific integrity in the NIWA case. 

Well true, but is the outcome

Well true, but is the outcome of any use when the integrity of the Justice system is in question?

Sorry, but this line of

Sorry, but this line of thought is simply bizare. While I agree, that the outcome of the court decision could influence the market value of farm sales or even the decision it is ruling on, it doesn't actually make the court biased one way or the other. They need to make a decision based on the law, as written, and there is no question over the integrity of the justice system in NZ.
Fortunately we don't have to concern ourselves with this problem when looking at the case around NIWA, the NZ justice system does not influence the existance or not of climate change, or the measurement of that which NIWA has conducted so far.
 

Its not the measurement but

Its not the measurement but the adjustments to the raw data that NIWA has made....and the court can throw thier method out and tell them to re-do it......better.
This isnt an argument on law its an argument on politics...and taking money, time and effort away from NIWA being productive.
Im hoping the Court throws them out as an obvious malicious scam....of course the funders have hidden themselves behind a vehicle to avoid paying NIWA's expenses...
regards

I doubt that the court will

I doubt that the court will even question if it could be done better actually. That question is certainly valid looking at a scientific paper, but I don't think is a correct test in a court case. Of course the people funding this case are not interested in applying this test, they are more interested in delaying tactics, and would prefer a trial by media or as close to it as they can get.
The question for the court is basically if the results are being manipulated towards a policy agenda, e.g did the methods have a particular result in mind, not if any studies have drawn the most accurate, or even correct, scientific result. In terms of adjustments then, I expect the court to question, why were they applied, not could they be done better. Its a subtle difference and one I expect to be lost on many here. For example the Lindzern satellite paper  which was published eventually in 2011 should pass the court test I think, though its been a failure of scientific literature and could only get past review at the very margins for this reason.
I don't anticipate that the NZ courts will get this wrong.
 

Surely we owe this much to

Surely we owe this much to the 'sceptics', to actually show some impact, and a necessity to act. Obviously there is more than one dimension to efficiency, and sometimes efficiency in one direction (e.g financial) creates inefficiency in other dimensions, (e.g pollution).
 

Double.  

Double.
 

The thing is, who get's to

The thing is, who get's to decide to decide what a decent job is? To put this in an absolutely concrete example, among the specific issues the Climate Education Trust are sueing over is that when the Wellington temperature station was moved from Throndon to Kelburn (inland and so colder) the recorded temperatures dropped by an average 0.79 degrees (this is pretty trivial maths). The Trust are claiming NIWA is committing fraud by allowing for the change in weather station position when looking at termperature change over time (which actually sounds to me like NIWA have been doing a careful and diligent job).
As this is the sort of basis for the case I would suggest that they are going to make a fuss regardless of what NIWA, regarding any result that shows any warming as indecent.
I also suspect given the construction of the Climate Education Trust, that the people invovled will just keep coming back in other ways to try and force NIWA to spend money on lawyers rather than research.

However NIWA should be highly

However NIWA should be highly above board on this.  If they have "fiddled" the numbers they should be sacked.  Now I think its un-likely and this vehicle is probably being funded by the Heartland Institute or similar aiming to dis-credit even just one pillar of the AGW arguemnt, even a small one such as NIWA.  They then can use this to tar and feather the bigger pillars...doesnt matter how right,  legit or moral just as long as they can keep their heads and others buried in the sand.    Also even if they (deniers) lose its no great thing as NZ is so small it can be ignored...
Provided NIWA have been mathematically and scientifically sound this should prove good proof for rational ppl however....we just have to hope NIWA has done it properly....or reasonably...ie I dont think they have to prove their method is the best or most accurate only that its substantially and acceptably sound and rigorous.
Interesting that even I think their brief says there is some warming, the argument now is its minor....that the earlier figures were manipulated to exagerate the later numbers so a steeper trend...
regards
 

Correct on the reasonable,

Correct on the reasonable, "resonsable and probable grounds" is the burden of proof the court would use in a civil case.

It is public knowledge (from

It is public knowledge (from the Heartland's filings with the U.S. government) that the people behind the NZ Climate Education Trust have received grants from the Heartland Institute. But if I had to make a guess, it is if the Climate Trust's records were to see the light of day, it will turn out the the people funded by Heartland have all been 'freely donating their time', and the Trust has received no direct funding. This seems to be the major model at the moment, which let's such groups say we are concerned individuals acting as individuals.

Blast, double post.

Blast, double post. Apologies.

#6    Anybody who promises a

#6    Anybody who promises a pension and does not prefund it is doing an evil thing.

No 9 With regard to the US

No 9 With regard to the US corn crop, will that not affect next season, not this one. It is high summer over there, ie the crop has a long way to go before harvest. The crop in the silos, from last year, will be the crop being eaten right now, and I would imagine like NZ it would have been forward purchased.

Except a huge quantity of

Except a huge quantity of crop now goes to ethanol so much so that stored crops have been run down...be that as it may the futures will be rising feedstock for ethanol will come from where?....NB I wonder how Russia's crop is this year.
What is interesting of course is the USA has a high drought while the UK is almost washed away, ditto Japan....Last year I think tennesse or texas has record rains...UK hit and dry, Russia hottest since records began....no one it seems wants to accept  the effects of AGW as real....uh hello...
""An act of nature in the United States"
NZ farmers should maybe wake up to how farcical their representatives make themselves sound...caring for teh environment.....year right.
bleh........
With attitudes like that why do I bother buying NZ produce I wonder....
Overall world crop comment here,
http://www.stackyard.com/agriservices/arable/crop_market_update.html
regards
 

The Recovery is here! Sing it

The Recovery is here! Sing it out:  Spend, spend , spend ....
"But like ice before the flame, consumers’ caution is slowly melting. The
0.3% increase in the June electronic card transactions report does
not sound like much, until one considers that petrol prices were
down 6% in June. Core retail spending (which excludes petrol
and cars) rose 0.9% in the month of June, following on from 0.8%
increases in April and May. All told, retail card spending during the
June quarter was 1.8% higher than the March quarter, suggesting
we’ve had another period of decent growth in retail volumes (which
rose 4.2% through the year to March 2012)."  
So says Westpac .... http://www.westpac.co.nz/business/economic-updates/economic-research-and...
Boom times are about to explode ...
 

Powerupkiwi how can we

Powerupkiwi how can we achieve a population of two billion on the
Planet

Just continue the status quo

Just continue the status quo and wait a few generations.

Powerupkiwi how do you rid

Powerupkiwi how do you rid the world of billions of people do
You have any criteria or race based
Method to achieving this vision of
Yours

Colin Riden has what will

Colin Riden has what will happen. But it will happen before 2050. Mother Nature doesn't give a stuff about a species having a high opinion of itself, she just ceases to supply enough nutrient, and they crash from overshoot. Well documented. this.
 
If we were an intelligent species, we'd agree on a one-chlld crash programme. Even that might be too late now.
 
I suspect we will have an all-in war over the remaining resources, and we can see the jockeying for position now. China vs the rest, Russia the swinger, is my guess. Pieces picked up by the survivors.
 
 

PDK: "If we were an

PDK: "If we were an intelligent species, we'd agree on a one-chlld crash programme"
 
yep, but, ain't gonna happen while this is going on
Taxpayers forking out $2000-plus a week to a select group of benefit-dependent parents with more than 10 children. see Herald article
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10819669

Easy to bash these people

Easy to bash these people from the beneficiary angle Iconoclast, but there is a risk to being off the mark. I have someone close to me that is one of those statistics, probably only through the top ups for the extensive number of children. For one thing they were/are all home schooled so there is a saving to the taxpayer, those now of working age do so and do it well. The oldest into their 30's now with children of their own. Because of a solid upbringing it is highly unlikely any will ever resort to crime. They are all intelligent people and well balanced because of the close family environment they have. Both parents are university educated and simply made a decision that chasing money wasn't important to them. While now more aware of the financial world, they were unfortunately the victims of naivety in their younger days. When I go to visit it is a bit like going to see the Oracle.Lol.
 
Quite frankly when I experience their family I am jealous of what they have. When you leave and are back in the rest of the city It feels a bit empty.
 
I suspect that once you go above 5 or 6 children then the mother is motivated and engaged.

Parasite only if taken over

Parasite only if taken over the working life of one individual, but what if the overall outcome of having those children making a positive contribution. I am not talking simply production here, but the social benefits that might accrue from having these guys amongst us. I am not necessarily sanctioning it, just offerening a different perspective. Like the other thread on this topic, one has to be careful about what constitues a parasite and who the worst parasites really are.
 
On the population question, having a breach of what is sustainable might be excuseable if the net result is a good pool of above average and aware people. Lets face it this bunch know how to survive on less than the average share of resources. The footprint of this family is quite likely lower than some of their neighbours with conventional families and lifestyles. I think the one vehicle does less than 1000km per year.

I can't argue with anything

I can't argue with anything you say. Would still be worth doing an analysis of their energy consumption compared to the average though, because that is the ultimate measure of who is a parasite.
 
What I really refer to in my previous post is what you refer to as "achieved". If you have 10 children with a lower footprint than the average 2 child family, and those 10 are actively involved in promoting a sustainable lifestyle compared to the 2 that work in the opposite direction, is that a net gain toward the objective? BTW Dad has always worked(from home), it is the top ups they qualify for. With a masters degree in philosophy it would be interesting to put the two of you together:-)

Surely the bigger problem

Surely the bigger problem population wise is that Mother Nature has little to do with the other end of the spectrum these days - that being end-of-life, as opposed to beginning.  Those here on blood pressure and/or cholesterol reducing meds - raise your hands.  Such life-prolonging meds didn't exist 50 years ago.  The first patient ever treated with dialysis was in 1945.
 
The planet probably needs a far greater number of young, healthy, fit individuals given 'work' (i.e. survival) will swing back toward a greater need for labour intensive activities.
 
I read somewhere that North American indigenous tribal elders often walked off quietly into the night in the middle of winter to die of exposure when they were no longer able to contribute to the work (i.e. survival) effort.
 
The elephant in the room isn't youth - that's for sure.
 
 

Is that your answer.so then

Is that your answer.so then if colin is
A prophet what shall we do follow colin
Or you

Why don't you think for

Why don't you think for yourself?
 
Monty Python did one of the better appraisals of followers........