A review of things you need to know before you go home on Wednesday; business costs go through the roof, average house now $1 mln, less concrete poured in lockdown, swaps slip, NZD soft, & more

Yeah that comment was unnecessary David, this is supposed to be a news article.

If you want to discuss this sort of thing why dont you turn on the comments on articles regarding govt curtailing our freedoms?

The mixture of protestors yesterday reminded of 1981 anti tour protests. There too you could see a tweed skirted granny type happily alongside a bikie. That was a protest about a wrong being inflicted on our nation by an out of touch prime minister and it rose up immediately. Yesterday ‘s event took twenty months to percolate to the surface. That is the rub. The clamp down on freedom has gone on too long for most to endure, even if you have not experienced  the far greater burden placed on Aucklanders. Just about all of those people had been patient and compliant but enough has become more than enough. The perception that the government caused the protraction of the restrictions because they failed to either procure or plan vaccination as early as they should have, is not easy to dismiss. People have turned on this from every point of the compass because they feel they are being punished in order to cover the government’s  inadequacy

The 1% have got wealthy by indebting the 99% for housing that has soared in price, 20% just in the last year in the United States, and also for medical care, utilities and education. The economy has been forced increasingly into debt just to function without wages and living standards rising.

How can one solve this? Taxation will not be enough. The only way that you can actually reverse this concentration of wealth is to begin wiping out the debt. If you leave the debt in place of the 99%, then you’re going to leave the 1% savings all in place. These savings are largely tax-exempt. Basically, I think you’ve left out the government’s role in this wealth creation of the 1%. Finance has indeed grown faster than the economy, and finance and real estate have merged into the Finance, Insurance and Real Estate sector, the FIRE sector.

High finance has absorbed the oil industry, the mining industry, and it’s absorbed most of the government. Financial wealth has become the economy’s central planner. It’s not planned in Washington or Paris or London. It’s planned in Wall Street, the City of London and the Paris Bourse. The economy is being managed financially, and the object of financial management is to make capital gains.

As your statistics point out, capital gains are really what explains [00:20:30] the increase in wealth. You don’t get rich by saving out of earnings and income. Rent is for paying interest. Income is for paying interest. You get rich off the government subsidizing an enormous increase in the value of stocks and bonds by the central banks.

The reason that inequality is occurring is that the largest public utility of all, money creation and banking, is left in private hands. Privatized banking in the West is very different from what government banking is in say, China. Government banking would create credit for public uses, for what the economy needs to grow. In the United States and throughout the West, banks create credit to slow the economy from growing, they make loans not to create new means of production and new factories. They make loans against property already in place – mainly to buy real estate already in place. Some 80% of bank loans in America and Europe are for real estate.

Banks make loans for corporate takeovers to buy other companies. They don’t make loans to build new factories, which is what government money creation in China would do. As long as you leave banking and credit in private hands, you’re going to have banks creating their product: debt. The more debt they create, the more debt service that borrowers, the 99%, have to pay the banks in order to obtain a house. or an education. or medical care, or just to break even.

The more money they pay the financial sector, the less they have to pay for goods and services. As the economy polarizes between the 1% and the 99%, the economy as a whole, shrinks, because more and more of its income is spent not on production and consumption, it’s spent just on debt service. My solution is to restore banking and credit to public hands to prevent the lending that simply finances asset-price inflation.

Second, you talked about taxing. Some taxes are more important than others. As long as the banks and the financial sector write the tax codes, as long as the government lawmakers are basically employees of the financial sector that finances their political campaigns, you’re not going to be able to tax them, or to close down the fictitious transfer pricing that corporations use to pretend not to make money except in artificial enclaves without an income tax.

You have to tax the source of the money that pays interest to the banks. That source is mainly economic rent. It’s primarily land rent. If you would tax on the increase in land values, if you’d have a land tax, which is what the whole 19th century was about – Adam Smith, John Stuart Mill and even Marx. You would not have this increased rent being paid to the financial sector to be monopolized by the 1%.

You’d have to change the way in which the tax code is based, away from earned income and wealth. But that is really not very practical in today’s political situation. You’d have to have a land tax and a natural resource tax to get rid of monopoly rent. You also have to return basic key infrastructure to the public domain, where it was before 1980, so that basic needs can be supplied at low prices, not creating monopoly rent for the 1%.

You have to realize that financiers use this wealth to take over the economy. This has to be reversed, because once you have wealth taking the form of financial claims and loans to other people as debt, you have compound interest. Any rate of interest is a doubling time, and compound interest is always going to grow faster than the economy’s real growth. The way to prevent this isn’t simply to lower the interest rate, which has been done today, to 0.1%. The only solution is to wipe out the overall debts that are stopping economic growth  Link

Almost certainly has. Expect it to be at least 25% down by this time next year.

NZ's Boomer Enrichment Scheme has performed as hoped, indeed! Look at all the record debt foisted on the next generations. Amazing achievement.

Why would this be Audaxes? The sheeple are not lining up for more debt so banks don't need it? 

But sweet and kind and innocent Jacinda said she never lies.

An arrogant, out of touch and authoritarian 'top down' government! 

I was embarrassed getting mine after only 11 years.  They only pay to top up my UK state pension so I'm not robbing you Kiwis too badly.  BTW in the UK it is pro rata to 30 years working in the UK. That makes sense.  How racism gets into the equation I can't fathom. 

Great news. The piss has been taken by this on some migrants for many years.