Thursday's Top 10

Thursday's Top 10: The story of Potash; The Fed is everyone's central bank; Rupeemageddon; China's zombie banks; Dilbert

29th Aug 13, 12:06pm by Bernard Hickey

This daily collection of links and comment was previously sponsored by NZ Mint. We'd welcome a new sponsor.

Here's my Top 10 links from around the Internet at midday today.

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.

My must read is #1 on Chinese consumer debt. My apologies for the slightly truncated nature of today's Top 10. I'm moving house to Brooklyn in Wellington. We finally bought one from our Auckland 'winnings'.

1. Chinese consumer debt - The FT's Debt Dragon series has its third part on consumer debt.

Until now most of the debt has been State Owned Enterprise or Local Government Debt.

Now China is trying to foster a consumer society, which would be good for New Zealand which sells protein and tourism to Chinese consumers.

In the West much of our consumer society has been fueled by debt over the last decade, while in China consumers are heavy savers.

So on the one hand getting Chinese consumers to borrow more is good. But on the other hand...

Chinese household debt to disposable income is still only 50%, while America's is 100% and New Zealand's is closer to 150%.

Here's the FT:

To buy his Shanghai house, Mr Dai, 30, took out a hefty mortgage. Monthly repayments now swallow up half his salary. Plus he has the other expenses of Chinese middle-classdom – overseas holidays, shopping excursions, movies and restaurants.

Mr Dai is hemmed in by debt. “Every second month or so, I can’t pay off my credit card bill. I save nothing,” he sighs.

This experience for a young professional, hardly unusual in the west, is a radical departure for China. The older generation, that of Mr Dai’s parents, was famous for its saving prowess. Memories of deprived childhoods in the Maoist era led them to squirrel away most of their earnings even as their fortunes improved alongside China’s fast-growing economy from the 1980s on.

But the young urban Chinese who have entered the workforce over the past decade grew up amid plenty, and their views about saving and spending bear little resemblance to those of their parents. Their willingness to borrow for today and worry about repayment tomorrow is beginning to reshape China’s debt dynamics.

2. Still plenty of urbanisation to go - So says Bloomberg is this good backgrounder. Again, many China bulls say it still has plenty of investment fueled growth to come as it prepares for all the country folk turning up in the city.

3. Chinese mini-stimulus - The Chinese have yet to really kick their habits of debt fueled stimulus spending on construction, it seems in this Caijing piece.

4. Charts of the day - 50 years on from Martin Luther King's speech and things aren't all better. Its's long but worth it.

5. US$100 billion - That's how much US banks have spent on legal settlements and lawyers over the last few years. It's more than they paid out in dividends.

6. The US Federal Reserve is everyone's central bank - So this Robin Hardy in this insightful FT piece.

7. Rupee carnage - The Indian currency had its worst day since 1995 yesterday. This is heating up.

8. The story of Potash - For students of farming and fertiliser this is a cracking yarn from Bloomberg of international intrigue and cartels.

9. China's Zombie banks - Here's a good piece from Reuters on this.

10. Totally Jon Stewart in his Jersey Boy mode.

The Daily Show with Jon Stewart
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92 Comments

by Roelof | 29th Aug 13, 12:17pm 1377735470

#5... it is a shame the fines did not come out of employee bonuses...

should people be able to hide behind the corporate enity.... when much of what they did was bordering on criminal..???

These no fault style settlements go against the cliche... " do the crime ...do the time"/

by Vanderlei Luxemburgo | 29th Aug 13, 3:30pm 1377747052

You're absolutely right Roelof. The notion of limited liability with regard to corporate entities need a major overhaul.

I understand that there is a need for proprietors to be protected from liability to an extent, but Many Many businesses and business people abuse this situation there days ti the detriment of law-abiding people.

It is time to re-examine these laws and amend them so that people cannot hide behind Ltd's or LLC's when they are clearly guilt of wrongdoing.

by iconoclast | 29th Aug 13, 3:52pm 1377748376

How about getting a bit local and domestic - you could go further and follow New York City

According to published reports most bankruptcies in new zealand are the result of Tax Department applications to wind up businesses for unpaid tax liabilities - while in New York if you haven't paid your parking fines they yank your driving licence. Now they are extending it to unpaid taxes. Imagine all the directors and shareholders being banned from driving on roads paid for by taxpayers

Good read - Scofflaws

http://finance.yahoo.com/news/ny-tax-scofflaws-pay-license-161909140.ht…

by Boatman | 29th Aug 13, 12:24pm 1377735873

Re Indian Rupee ... This could be a second Asian Banking crisis in the making, so hold onto your seats boys.

Watch what other Asian markets do today

The Indian Stock exchange has lost US $1,000,000,000 (Billion) in 8 trading sessions, and US$11,000,000,000 has been sold off by foreign invesotrs over the past 8 weeks since June .

Basically the Rupee has lost enough of its value for Indian companies to start breaching their Banking covenants on overseas sourced loans.

The last Asian Banking crisis was sparked when the Malaysian Ringitt lost a big % of its value in a few weeks , this time its actually worse as the losses are bigger and the Indian economy is much much larger .

by Gummy Bear Hero | 29th Aug 13, 12:40pm 1377736848

...... there is of course , a flip side to every coin .... India's is that it's export industries are gonna go gangbusters now .... and importers will struggle ...

Which kinda rebalances the country's fiscal position .... with no need for intereference by their central banker or by any busy-body-know-it-all politicians ...

by KH | 29th Aug 13, 12:42pm 1377736929

Yes Gummy. What I think too.

by Stephen L | 29th Aug 13, 12:54pm 1377737651

Except that it's not that easy to think of Indian products. Call centres, software development come to mind; but they don't seem resilient industries to me. The diaspora is their other great industry, but that also runs the risk that some doors will close.

I do suspect they have wasted years of hubris and an overinflated rupee, and not really invested in export capacity; or even significant real import substitution. Hopefully for their sake, I'm wrong.

If NZ had such a depreciation, I share your views that the adjustment would seem easier to me, and in many ways beneficial; albeit with some stresses to those invested in imports.

We have though arguably also wasted years of an overinflated currency and easy foreign money.

by Gummy Bear Hero | 29th Aug 13, 1:02pm 1377738175

Curry powder ? .... cars .... motorcyles ( Indians ! ) ..... clothes / fabrics ..... spices .... chemicals ... farm machinery ... precious stones .... $US 300 billion of exports in 2012 ......

... have a cup of tea ( Indian ! ) , and re-think that bit about India not having many exports ..

Ta ta !

by Stephen L | 29th Aug 13, 1:07pm 1377738448

Hope you're right. 1.3 billion people is a lot to look after. That's a lot of curry powder and tea. I actually would buy a Jaguar car, although are they made in India or the UK?

I spent a few months going back and forth to Mumbai and Delhi from London in 06 and 07, and enjoyed the business dealings. But getting around was hopeless. A business challenge was in sorting out the 28 states of India and all their cross border taxes and rules and nonsense vested interest protection stuff. It's not all that apparent from the outside that they've fixed much of that.

by steven | 29th Aug 13, 1:18pm 1377739088

I quite fancy on the the Royal Enfields they still make...very retro 1950s, a cafe racer, wonderful looking things.

Yep, I think india is reknowned for its internal graft and the mess of its bureaucratic "management"....

regards

by Stephen L | 30th Aug 13, 8:26pm 1377851199

Indeed,

It's important any western company sticks to any such medium or high level rules. I confess though to paying some hundreds of dollars in total of my own money to have someone "manage the administration " for me for some low level but critical services. Never a bribe of course.

by Christov | 29th Aug 13, 1:07pm 1377738451

Saffron my good man......still as good as, if not more valuable than Gold.

by Boatman | 29th Aug 13, 1:21pm 1377739311

There are lots of real problems with India with regards to state inefficiencies , corruption , and a plethora of restrictions on doing any type of business

Its nothing like what we are used to here in NZ with zero corruption, sound regulation , and a fully functional government at all levels.

I stand to be corrected , but India rates something like 132nd out of 150 countries for doing business, while NZ rates consistantly very well in the top 10.

by steven | 29th Aug 13, 1:14pm 1377738853

except of course leaving as is to the free market will collapse its system.

Funny how the right wingers and libertarians are prefectly happy to dole out misery based on tehir own mantra when the misery is someone elses.

regards

by Andrewj | 29th Aug 13, 12:50pm 1377737434

As Grant Williams shows in his latest "Things That Make You Go Hmm", the warnings came loud and clear, and were very explicit in the form of not one, not two, not ten, but many more sequentially imposed and escalating forms of capital controls by the Indian central bank that sought to prevent the conversion of paper into hard currency. Gold.

http://www.zerohedge.com/news/2013-08-28/things-make-you-go-hmm-many-clear-signs-indias-currency-was-set-epic-crash

by Boatman | 29th Aug 13, 1:38pm 1377740280

Apologies ,ostrich , you are quite correct , I asked a friend , Uncle Google, and he confirmed your assertion .

I should have known better as I was working for Standard Chartered PLC at the time , and we had huge exposures in Malaysia which hammered the Stanchart share price.

My recollection of events were distorted by the Malaysian malaise, and its fallout at the time especially when they resorted to fixing the previuosly floating Ringitt.

Either way , I dont have a good feeling about Indias problems especially the risks of contagion from such a big market

by KH | 29th Aug 13, 12:45pm 1377737141

#8. The potash cartel. We have cartels everywhere. But don't say so -- it's impolite.

The Germans way back had an innovation though. Astonishing. The rules for the potash cartel included “in accord with the general welfare of the German people.”

In our plague of cartels in New Zealand, we don't see anything like that. It's time we bought it in.

by Boatman | 29th Aug 13, 1:15pm 1377738936

Correct KH there are cartels in almost every commodity (even Milk) .

One of the worst is SODA ASH which is used in water purification , and is almost 100% controlled by a US syndicate

by Gummy Bear Hero | 29th Aug 13, 1:23pm 1377739398

... apparently wood ash contains up to 10 % potash by weight .... so if there is a worldwide shortage ( PP : Peak Potash ) , all we gotta do is burn down a few forests !

by Christov | 29th Aug 13, 1:40pm 1377740443

Or four sequoias..... I mean no sense in waste is there..?.

Oh I see Cunny's on the slide to someone else......this "someone else" must be quite some chappie altogether pulling all the Nat voters to root for him.

Mr Chaston...I say Mr Chaston, could we start the poll again and introduce another contender...? I'm proposing "Anyone Else Butt " as I think it would give more balance to the intention of the poll.

by Gummy Bear Hero | 29th Aug 13, 1:58pm 1377741500

... he should plonk Bernard's name in the poll ... swear to goodness , if the Hickster was fronting the NZ Labour Party , I'd vote for him in 2014 ...

Picture in your mind's furtive eye , the newly elected PM of Kiwiland , who do you want ...

.... Cunny ... nahhh ! .... Jones .... nope ! .... Robertson ........ahhhhh , no ...... Bernard ? .... bing-bing-bing .... yup !!!

by Christov | 29th Aug 13, 2:37pm 1377743870

So help me out here GBH....what would Bernard's policies be...? broadly the agenda, I mean.

What we know...... likely have all Boomers arrested on suspicion on non transference of wealth, rightfully belonging to the disadvantaged first home buying Gen X.

Confiscate anything with a resale value, and or directly transfer property to those disenfranchised from the possibility of ever owning it.

Extend the retirement age to 75 while placing all those already 65 into work camps for N.Z. roading.....cap the retirement payout to 76 for those surviving the work camps.

Regulate the banking industry , placing Wheeler in sole charge to determine profit deemed reasonable.

Overhaul the Health system to discard anyone over 65 as they probably add burden to the already overtaxed minnium wage earner.

Hold a collective assembly court trial finding the Boomer Generation guilty of evertyhing from theft to bad parental advice, and sentence them to permanent community service rickshawing Gen X to and from their place of work solving congestion problems on two levels ( if they run hard enough)

I mean i just can't see him winning the popular vote with so many crusties out there...!

by steven | 29th Aug 13, 3:04pm 1377745498

Hmm GBH and think in the same sentence.....hmmm...hard one that....nope cant see it....ideological burb learned be rote maybe, off good ol' mises knee....yep.

regards

by Vera Fayed | 29th Aug 13, 4:25pm 1377750300

(Comment deleted due to use of personal insult. Please play the ball and not the man/woman. Ed. You can read our commenting policy here - http://www.interest.co.nz/news/65027/here-are-results-our-commenting-po…)

by Gummy Bear Hero | 29th Aug 13, 5:38pm 1377754694

... any chance of interpreting steven's comment for me , Miss Vera ?.... I'm sure he's being insulting , usually he is , but it could actually be a complement instead ...

My mind , as ever , is open .... I do wish the surgeons would put the top of my skull back on ...

by Vera Fayed | 29th Aug 13, 6:51pm 1377759060

(Comment deleted, Ed).

by Vera Fayed | 29th Aug 13, 7:01pm 1377759661

Google translate apparently doesn't have a "steven to English' dictionary. I'll have a crack at it for you (no pun intended).

Hamburger hamburger hamburger peak oil hamburger hamburger. No fries.

regards

by Gummy Bear Hero | 29th Aug 13, 7:59pm 1377763176

Nyahhhh , ha ha ha de haaaaaaaaaa !!!!

... good one ... Cheers !

regards

by iconoclast | 29th Aug 13, 3:15pm 1377746143

Work for the Pension Party. Bernard can never stand for parliament. That door is closed. He has shot himself in both feet. His manifesto's are sprayed all over the internet on the NZherald and Interest.co.nz Whenever he stood up to make a speech he would have his past thrown in his face.

by Gummy Bear Hero | 29th Aug 13, 5:34pm 1377754472

... give them their due , the Pension Party are promising ( threatening ? ) to raise the age of retirement ....

And having his pasta thrown in his face has not stopped Winnie " Luigi " Peters from having a successful career in politics .... ( I say " successful " from his personal perspective , not from taxpayers' , of course ) ... so why should it stop the Hickster ?

C'mon Bernard , throw yer cloth cap into the ring !

by scarfie | 29th Aug 13, 3:07pm 1377745655

I think you could cover the field effectively if you included "Butt Crack" along with "Anyone Else Butt"

by Christov | 29th Aug 13, 3:23pm 1377746637

Your on it scarfo, almost...think A E A.

by Learn to Socia… | 29th Aug 13, 3:28pm 1377746937

Re everything

I am dreaming of a change of government. I always vote for Winston Peters, even though I don't agree with him on a lot af topics.

I care about NZ sovereignty, what is left of our 67% pure environment, our resourses being stolen, the Magna Carta, and the freedoms that so many hundreds of thousands (millions!) of our forebears suffered, fought and often died to win for us, and desperately hang on to for us, their descendants! (We are suffering/fighting today, so that some day, our GGGGGgrandchildren can be FREE). It is important. When we read World HISTORY, we are mostly reading about that ongoing struggle, going back in time, all over the globe.

I think that the change in leadership in the Labor Party is a good thing. I liked David Shearer, but am glad to see the tail end of him. He wasn't up to the task of defeating John Key and his bosses, in the next election.

Just getting a change is not enough, as the USA has found with Obama.(We have a choice! We can eat at McDonalds OR Burger King!). We do not want to end up with the Labour version of John Key (Helen Clark etc). I have despised the Labour Party ever since David Lange and Roger Douglas invited the invasive Mind Slime Meme of Neoliberalism to cross our borders and colonize our political landscape. Labour and National have nurtured/fertilized/spread its spores far and wide to almost ever aspect of our society.

GET YOUR INVISIBLE HAND OFF OUR ASSETS April 29, 2012 at 8:38pm

Speech to the New Lynn Women’s’ Branch, New Zealand Labour Party, 29 April 2012

David Cunliffe, MP for New Lynn, Labour Economic Development Spokesperson.

- See more at:

http://thedailyblog.co.nz/2013/08/27/im-sorry-mr-cunliffe-what-were-you…

I don't know much about David Cunliffe or Grant Robinson. I like what David Cunliffe said in the above speech.

Please, Labour Party, make a good decision

by south paw | 29th Aug 13, 7:42pm 1377762162

Hugh, Not PC starts wiith a quote from Ayan Rand - a woman of no intellectual significance who operated some kind of quasi cult "school" in NYC devoted to herself as the charismatic authoritarian leader.

Not very credible.

Deregulation was a failure, just look at safety in the Forestry industry today - "self regulation" = lots of dead or maimed workers.

Why are we the public always told we can only choose between Muldoon type totalitarian state control or crack pot Rogernomics derugulation?

by PhilBest | 29th Aug 13, 9:21pm 1377768103

Ayn Rand: "no intellectual significance". I guess to be "intellectually significant" you and your followers had to advocate violence and mass "liquidation" in your cause, i.e. Marx, Lenin, Mao, Che, etc etc

But advocating nothing but pure reasoned argument and expecting your ideas to prevail in the end because truth is on their side, I guess this makes one "intellectually insignificant".

I disagree with Ayn Rand on "altruism" but a lot of what she wrote makes sense. The book "Capitalism: the Unknown Ideal", for example. The title says it. Hugh P and Peter Cresswell are right. Most people wouldn't know real free markets if they tripped over them.

I don't believe for a moment that forestry is "deregulated". The OSH of the current era is absolutely over the top compared to workplace health and safety, say, 40 years ago in your imaginary super-safe, everything regulated paradise.

Environmental regulations are irrational lunacy; if open cast mining was allowed, as of course it always was back in the old, imaginary super-safe regulated era, a whole lot of miners would still be alive. And no-one would have the faintest idea that there even was an open-cast mine anywhere, or would even hear of one at Pike River, if it were not for looney eco Taleban holding mass Gaia-worshipping rallies and hijacking our democracy with their theology.

And were there urban growth boundaries in this so-called "more regulated" era? Was housing more expensive because of regulatory distortions to supply, back then - or now?

Who yearns for the good old days of waiting 6 months for a telephone connection? Or Railways having a monopoly on freight, and losing and breaking stuff all the time? And taking a week to get stuff from Auckl to Wgtn; longer to the SI. And nil traceability.

Who yearns for the good old days of a Drill Press made by an "NZ Manufacturer" costing about 10 times as much in actual dollars even back then 25 years ago, as an imported one does now?

Cresswell is absolutely right about building inspectors - blaming leaky homes syndrome on some alleged "absence of regulation" is lefty propaganda that Stalin would have been proud of. Regulations existed; standards and certifications existed; permits were granted and inspections passed. Buildings leaked. So let's conveniently pretend the regulations, standards, certification process, permits and inspections never existed, and an absence of such things needs to be rectified so a failure like leaky homes syndrome does not happen again.

Cresswell is also right about monetary policy being a central cause of economic boom and bust cycles - deeply ironic, considering central planning of the money supply was allegedly to avoid this.

And those alleged "free markets" in telecommunications and energy? Utter B.S. Politicians selling S.O.E.'s do not ever "deregulate and sell". They sell functioning and guaranteed monopolies, to maximise the selling price. Can someone build a new hydro dam in your region and sell you cheaper electricity than some other supplier hooked into a national grid and having to bid for supply that has pretty much been fixed by regulations? No? There sure ain't a "free market", then.

by Gummy Bear Hero | 30th Aug 13, 8:55am 1377809743

For a good read on the subject of subserving one's life to the dictates of authority , I thoroughly recommend Erich Fromm's " The Fear of Freedom " ....

... and we're witnessing the same effect now , as the NZ Labour Party reject a quiet , thoughtful leader , and seek an alpha male to stand up to the PM , whom they call the " $ 50 million gorilla " .....

Sadly , Kiwis are destined to fall again for a " Muldoon " figure , a know-it-all , I will shine the light , and show you the way type ( and if the " I " fails , he or she will quickly depart these shores for a well paid sinecure offshore , and leave you plebs to your fate ! ) ...

by Gummy Bear Hero | 30th Aug 13, 11:08am 1377817698

If you want to read it , and can't locate a copy , gimmee a heads up , and I'll get my copy to you : Gummy .

by Vera Fayed | 30th Aug 13, 11:40am 1377819600

It's a fabulous read Gummy. I read my old copy so much I wore the ink off the pages. Fromm is one of my personal heroes. It is available online at http://majnown.files.wordpress.com/2011/07/erich-fromm-the-fear-of-freedom-escape-from-freedom.pdf .

And now my old mate, I must say goodbye. I have been banned. Thanks for the laughs. I have hacked the site to leave a final message, before they slam the door on me for good.

(Comment edited due to repeat personal abuse, Ed).

Hugs to Mrs Gummy, I bet she's a Babe.

Thanks also to Waymad and Christov for lightening things up, and giant raspberries to you scarfie - I'm off to spend truckloads of unearned income.

by Gertraud T. | 30th Aug 13, 11:52am 1377820340

Vera - don't go, I need somebody to comment on steven's, so I can put my tick on yours........

by Gummy Bear Hero | 30th Aug 13, 12:14pm 1377821676

Agreed : You're an integral member of our little family here at interest.co.nz , Vera .....

... don't leave me alone with steven & PDK !!!

by Snodgrass Thro… | 30th Aug 13, 1:13pm 1377825224

I think when stevens boss finds out what he really does all day he's going to get Very Fired

by Andrewj | 30th Aug 13, 12:03pm 1377821004

So thats where everyone is going. I was woundering where Wally had gone too, he had a few warnings too many perhaps.

You should have insulted me I would have considered it a complement, I mean what so wrong with taking a little time to get there?

by Gummy Bear Hero | 30th Aug 13, 12:17pm 1377821844

... wow , Wolly got banned ! ... he was an original blogger here ... the lad should have been granted a life's free subscription and double immunity ....

I miss his free for all banter !

by Christov | 30th Aug 13, 12:47pm 1377823664

Wooly..? AKA..Wally....?Bernard's T.V. debut soundbite got banned...? no way hose b..?

Dear Ed...ahem

Just wondering if you could post a list of all banned persons since the sites inception..?

To gain an insight to their personality types.

It may aid those of us in need of behavioural modification assisted, or otherwise before we stray beyond the fenced parameters...er , so to speak.

I fully appreciate that abuse is open to interpretation, it's just, not having felt it, even when it may have been intended, could render me in the status the abuser suggested I was in..

There was this chappie here once lawn something...anyhoo, he was extremely hostile to say the least, but I chose to engage with him over several months until he exploded and said goodbye forever (no crap) his parting words.

I'm not sure what my point was, but that is what medication is for...oh yes , the list , s'il vous plait

by moa man | 31st Aug 13, 11:19pm 1377947972

That right Mr Christov?

I think your memory may be impaired

by tor lawn | 25 May 11, 9:45pm

Mr Christov,

I await your

your evidence ...

or apology ...

or you can run off to Mr Hickey and Co. and complain.

The first option will prove you are right, and i will retire.

The second will restore your honour and you can admit to making false accusations.

The third will make you a coward.

.....................................

by Christov | 30th Aug 13, 12:05pm 1377821128

Damn it Vera...you can't go...! not like this..!

I'll be alone with Mr Big and the wardens, and what if GBH goes off on another taffe course...? It'll be back to me being pasted while on the site instead of pasting on the site.

If you must go......you will be missed by many of us.....travel well, stay well,

I shall raise a glass to you this very evening......Cheers Vera Fayed.

by Gummy Bear Hero | 30th Aug 13, 12:27pm 1377822436

Perhaps if the moderator puts down his book on " Classic Dishes of Inner Mongolia " and reads another of Fromm's classics instead , " The Art of Loving " , he will forgive the banned , and admit them back into the fold ?

.... and then fry up some yak's gizzards with an improved peace of mind ...

by Gareth Vaughan | 30th Aug 13, 5:26pm 1377840360

For the record folks, neither Wolly nor Vera Fayed has been banned.

You know that we welcome robust debate but draw the line at personal abuse as outlined in our commenting policy here - http://www.interest.co.nz/news/65027/here-are-results-our-commenting-po…

"We'd again like to reiterate that abusing fellow commenters, the authors of articles published on interest.co.nz, or people interviewed and quoted in our stories, won't be tolerated. Play the ball and not the man or woman please."

by Gummy Bear Hero | 30th Aug 13, 6:20pm 1377843659

Bless you , my son , for clearing that up ..... heartened we are , that our friends Wolly & Vera can still roam as free as the Inner Mongolian yaks around us ....

... now , what would you like to yak about .... some lightly fried spleen in a tempura batter ?

by Christov | 30th Aug 13, 8:50pm 1377852623

Hey that's great news Gareth...I love you and want to have your baby...so ummmm were is Wolly then....? could we ping him...?

by powerdownkiwi | 30th Aug 13, 12:45pm 1377823506

now, remind me, what is John Key, again?

by Gummy Bear Hero | 30th Aug 13, 12:54pm 1377824086

" Who is John Key " , not " what is " ..... probably he is the finest Prime Minister this splendid land , girt by sea , has ever had .....

by Christov | 30th Aug 13, 1:11pm 1377825103

Now GBH...you know full well the kind of mass debating that's going to provoke.

by Gummy Bear Hero | 30th Aug 13, 1:19pm 1377825580

As Mr PDK himself would say , we are indeed in a prosperous era , with the greatest government we have ever enjoyed , and the most remarkable PM , the golden Key to our future ....

by Gummy Bear Hero | 30th Aug 13, 6:26pm 1377844010

Cunny may be a well experienced politician , but he alienates people , he gives off this arrogant / smug aura ..... sort of like Kevin Rudd in Australia does .....

...after an intial " honeymoon " period , where everyone worships the very ground he floats across , you can't quite putcha finger on it , but for some reason you've come to hate the guy with a fervent passion ...

The ALP now regret that they knifed Julia Gillard !

by iconoclast | 30th Aug 13, 6:45pm 1377845126

He was adored by all the school kids and all the Sunshine Staters who have had a touch of the sun, but the voting adorers wanted him back as the ALP leader so they could have the personal satisfaction of grinding his smug face into the dirt themselves. The dumb apparatchiks knifed Julia to put Kev back in thinking he was so much more electable. Little do they know. Regret - good description

by Gummy Bear Hero | 30th Aug 13, 6:51pm 1377845468

...... if he'd gone to the polls within a week or 3 of ousting Julia he may have stood a chance ... but in the glaring media spot-light we're all seeing Kev as he really is , very much in love with himself , and a pathological hater of the studios' make-up staff ....

And he waffles on & on .... Tony Abbott was correct to ask can anyone shut this guy up ..

by Christov | 30th Aug 13, 1:09pm 1377824988

now, remind me, what is John Key, again?

A fifty million dollar turd in an Armani that would have you believe he had it tough. that you too can aspire to have 50 mill through honest endevour, (insider trading ) excluded. That you too can reach unparalelled levels of self importance untill you are surrounded by a halo of your own smug.

Needless to say his cronies have some way to go on their smug emissions.

by Brendon | 30th Aug 13, 6:43pm 1377844986

Hugh I do not know much about Ayn Rand, but Neoliberalism isn't my cup of tea.

But your description of kiwis unnatural worship of Daddy (or Mummy) is so true.

We give too much power to our Muldoons, Clarks and Keys.

by powerdownkiwi | 30th Aug 13, 8:19am 1377807555

Any Rand is useful as an example of flawed thinking, as is Julian Simon, and a host of paid think-tank shrills nawadays. You can use it as a mirror for your own thinking, in a continuum of retesting (and if one can't do that, one has no right to opine).

The trend described - Muldoon era to now - can be simply summed up as: 'efficiency gains'. Nothing more, nothing less. Ideology is irrelevant, the driver was the need for efficiency, and it either had to be pursued, of the society would fail.

But - you can't put a dam where the Roxburgh Dam is. You can'r dam the Waitaki is dammed. Those cherry-picked options are off the table. So there is a fettering to a 'market', no matter how 'free'. Ideology, meet physical planetary limits.

Leaky homes? Were a result of human arrogance at most levels of society. Again, not ideology. Just self-importance placed ahead of the fact that rain still happens, mostly in the direction of down.

Yes, money supply has to match the available planet. Which means it has to be restricted, commensurate with the reducing availability of Roxburgh and Benmore sites.

by steven | 30th Aug 13, 11:47am 1377820064

As a fiction novelist, yes sure her work is.....uh...interesting...

She is indeed of no intelectual significance in terms of economic rigor. Now I wont argue she has had an impact on economics, but here work shows little academic capability, political, sure...hence doesnt justify the term intelectual in this context. Huge negative impact, yes sure....

But your defence fo her fictional work sure was interesting.

regards

by steven | 30th Aug 13, 12:02pm 1377820968

Maybe try reading all of it,

"Texas production in 2012 was still 1.4 mb/d below the state’s peak production in 1970, and I haven’t heard anyone suggest that Texas is ever going to get close again to 1970 levels. Production from any individual tight-formation well in Texas has been observed to fall very rapidly over time, as has also been the experience everywhere else."

"Optimists may expect the next century and a half to look like the last. Benes and coauthors are suggesting that instead we should perhaps expect the next decade to look like the last."

Maybe you should realise making such ill-informed comments make you look silly to someone who has some knowledge in the subject.

Maybe why no one is paying you much attention down in Chch? How can anyone consider what you write on "demogrphics" is soundly based when you demonstrate just how un-sound and clueless you are in areas you clearly know nothing about and dont intend to correct.

regards

by powerdownkiwi | 30th Aug 13, 12:35pm 1377822934

Good read, Hugh.

Interesting indeed, even more so if you'd bothered to read it.

Most of us have indeed come to the conclusion - years ago in my case - that the timing would be pickable, inevitable, and followed with spin/noise (that article is neither).

C&C (conventional oil) peaked or plateaued in 2005, as long predicted, and hasn't gone back. Unconventional oil (Yergin's 'The Quest' is an arms length away as I write this, an intelligent appraisal historically/politically, tragically myopic otherwise) has been fudged in, to obscure the raw graph, as has (in the IEA case) "yet to be found oil".

http://earlywarn.blogspot.co.nz/2010/11/iea-acknowledges-peak-oil.html

Most folk give up discussing when the ship will sink, at some point. They get on with donning lifejackets. This is where they've gone:

http://www.resilience.org/

Which is exactly the approach I've been taking for the last few years. Getting resilient. You should be very worried by that article, Hugh.

by powerdownkiwi | 30th Aug 13, 12:43pm 1377823404

Now THIS will be very interesting. Hughey stuffed up, and two of us spotted it.

Watch the ticks - any that Hughey's post gets, can be assumed to be owned by idiots, illiterates, or idealogues.

Maybe we need a poll - you don't get to use a 'tick' is you are guilty of one of the three 'i's.

Aye, aye, aye...... sorry, the eye's clearly don't have it. I'se sure of dis.

by steven | 30th Aug 13, 1:52pm 1377827523

ticks, yep....interesting, when I first came in here I thought I'd find many ppl interested and knowledgable on economics, finance, management etc. I was I think wrong on that. It seems its few, otherwise lots of ignorance and/or lots of right wing and libertarian politics from ppl frozen in their minority views.

Some must think the ticks are easy ways to add weight to the weightless argument. Or the blindly ticking of those who write no matter how illogically against others whos view point they are against...oh its vera v steven, I'll tick vera......tick vera.....tick, tick, vera.

I'd hoped for better....mind you we could have the loopy lefties in here in droves as well, so thank heavens for small mercies.

regards

by Gummy Bear Hero | 30th Aug 13, 1:55pm 1377827736

" Peak Ticks " is it , now ? .......... haaaaaaaaaaaaaa !

by steven | 30th Aug 13, 2:01pm 1377828067

No, I expect the peak tickers to be able to grow their output yet for some years......until their investments become worthless and they drop off the Internet, too poor to pay the monthly charge.

regards

by steven | 30th Aug 13, 7:21pm 1377847282

Look at that GBH, 5 ticks, not 10 mind, maybe you are losing your edge old son...

regards

by Gummy Bear Hero | 30th Aug 13, 7:28pm 1377847723

.. unlike you , my friend , I do not live for tiicks ...

Keep counting them steven , if you choose to , but kindly let the rest of us get on with enjoying this wonderful life ....

regards

by KH | 30th Aug 13, 2:05pm 1377828318

PDK. Using 'idiots, illiterates or idealogues'. Is that what you call 'shooting the messenger' ?

by powerdownkiwi | 30th Aug 13, 7:09pm 1377846573

KH - nope. They'll be shooting themselves. I'll just scorekeep.

by steven | 30th Aug 13, 7:22pm 1377847343

cant be, they have no message

regards

by Gummy Bear Hero | 30th Aug 13, 7:24pm 1377847491

.. sorry , what ... what're yer trying to say ?

by steven | 30th Aug 13, 1:56pm 1377827775

Note the bit on Texas, no one expects texas to exceed its 1970s peak. Yet the pundits expect the USA will be awash with oil and an exporter again.

So if its not texas greatly exceeding its 1970s peak (and for a long time) where will this excess be coming from to make OPEC moot?

Does not compute.....does not compute.

regards

by Gummy Bear Hero | 30th Aug 13, 12:42pm 1377823347

... oh ! ... so " The Oil Drum " is shutting down .... deemed irrelevant in a world where fossil fuels abound , and " peak oil " is just another Malthusian fantasy ....

by steven | 30th Aug 13, 1:24pm 1377825880

The great thing about a rational market is, some can exit in good time, I have. The rest, many, will be the sacrificial canon fodder....left in the market(s) unable to sell as the stockbrokers and large blood suckers sell first.

If the micro-trading glitches are any example its quite probable when it happens it will be over and at the bottom in a day.

"Malthusian fantasy" its maths GBH, something I can but assume you skipped in school? left before the expotential function was shown to you?

No way can infinite divide into finite, GBH the only answer is 0, the only question is when. Given its a doubling time issue, the zero pops up very very fast....

regards

by Ms de Meanour | 30th Aug 13, 2:48pm 1377830929

I followed up one of the links in the article under discussion, to this. It's a really good and clear explanation of an economist's view, as opposed to the monstrous caricature of economics that is espoused by so many here

http://www.econbrowser.com/archives/2005/07/how_to_talk_to.html

by Christov | 30th Aug 13, 3:01pm 1377831670

Very good link MdM....and yes communication seems to be the consistent failure to connect on this site, like many others.

Get a better look at Cassandra's Dress for those interested in checking out the link.

I'd guess for many here , myself included , lay explanations have more impact, particularly with terminology references used.

by steven | 30th Aug 13, 4:17pm 1377836277

I read it earlier

regards

by dh | 30th Aug 13, 9:23pm 1377854610

I think there is a flaw in that article in as much as it suggests that while rulers of countries might have a short term interest at getting the oil out, corporations are going to take a longer view to maximise profits. That is predicated on the corporations have an eternal sole property right to the oil in the ground so can wait to maximise profits, in the real world this right tends to be limited by licences for a limited period of time (so need to get the oil out at the time) or licences that will lapse if unused (so have to be getting the oil out to maintain the licence) or non-exclusivity (so the possibility, if you find usable oil, that someone else might sink a well drawing on the same basin).

All of these naturally work towards not saving the resource for the more valuable future.

by Plutocracy | 30th Aug 13, 3:38pm 1377833885

You do realize that the article you linked to clearly states that peak oil is still a problem right!? Here I was thinking you were scientifically illiterate.

People need to face the fact that the fundamentals have changed. Cheap oil is a thing of the past and we should be looking for ways to mitigate and improve our society in a time of contracting resources and economy. There are studies which have looked at the depletion rate of the shales and these seem to indicate a peak at around 2020. The smartest thing to do would be to use this 'last hoorah' of production to prepare our society for the inevitable shift away from fossil fuels.

Now we need to start thinking about societal / infrastructure arrangements that can function well in the long-term for a time when we will likely not have the current abundance we enjoy now. Listening to comments like yours and your petty 'Malthusian' clap trap does your credibility no favours. Same goes for PDK when called people 'idiots' etc. Real physical limits exist in this world and we are fast approaching them. The world is in recession and yet oil still sits over $100 per barrel, does this indicate abundance to you?

People who believe that we are about to return to 'normal economic growth' are likely going to be disappointed. It's time to start thinking ahead rather clinging to a system which will inevitably fail.

by Christov | 30th Aug 13, 3:59pm 1377835175

Yes of course I did Plutocracy...I am well documented here on the subject of finite rescource.

A. I am not qualified to answer many of the counter arguments.

B. I have more interest in those who are qualified here, being better able to communicate their findings to an audience that appears to disengage for reason of implied inferiority.

C. I am well documented here on my thoughts on the proliferation of the species ,unchecked.

It has become , round here , like religion , zealotry often works in like minded strong willed individuals who see (in their opinion) the urgency of sharing a message that will have a bearing on the future of man.

The site MdM put up, was moderate in approach without condescension or indeed the impending peril of an apocolytic event, allowing the picture to develop at peoples individual uptake pace .

You know PDK often gets it right when he says Shoot the Messenger, but I'm not sure that he completely grasps why they want to.

by Plutocracy | 30th Aug 13, 5:09pm 1377839351

No shot at you Christov, just the inanity of the situation in which one person is fundamentally disconnected from physical reality (Hugh) and harping rubbish and the other is correct in his fundamental message but is likewise appearing abusive and condescending (PDK). Lift your game chaps.

by powerdownkiwi | 30th Aug 13, 7:18pm 1377847101

Christov @ 3.59

cheers, I'm well aware. I tried being nice, debating rationally, and presuming we might get there societally. That started in 1975, for me. By the mid '80's, I was onboard a LA, pointing out this stuff in debate. Those LA's were sidelined by the 'free marketeers' - folk who are either too stupid to realise what happens and how quickly, or who have a vested interest and a belief - and that's all it is, a belief - that somehow they'll be among the survivors.

That approach didn't work. If it had, it would have, kind of thing. So I've changed tack - and no apologies made. We're out of time, and there's some future generations to champion.

Simple as that, really. We all wake up with our own consciences. Go well

by Christov | 30th Aug 13, 8:41pm 1377852060

All the best to you, as always PDK, you have to do ....what your driven to do ...

I require no apology for that..

Stay well

by Plutocracy | 30th Aug 13, 9:16pm 1377854207

Face it, humans are reactive not adaptive that's how we are wired. I can understand your frustration as you have clearly seen this coming for such a long time but aggression and name-calling doesn't add anything and subtracts from your otherwise grounded message.

You've probably influenced more people through your posts then you realize and I think it would be a shame for you to marginalize your audience before they had the chance to digest what you're saying. As I have said before 'keep banging your drum'.

If it's any consolation there are a lot of people out there who are starting to understand the challenges we will be facing.

by powerdownkiwi | 31st Aug 13, 7:58am 1377892706

Pluto - fair comment. I was reading Maurice Shadbolt's appraisal in 'Boy Roel, Voyage to Nowhere' last night. 1972, and he had it eloquently nailed.

Which means we won't do anything until we're made to, en masse. The 'folk who are starting to understand' get different treatment from me - discussion, demonstration, visits, practical help.

The other end of the spectrum, including some here, have had long enough with the politeness thing. When I first posted here, it was with politeness - long genuine discussions with PB, for instance. Some listened, thought, and good on 'em. The remnants - there were always going to be remnants - I have a diminishing-scale of tolerance for.

While that education process is going on, there's a growing awareness that mainstream 'save the............' environmentalism, even though it is always going backwards, always on the defensive - is actually 'not enough'. You can't 'save the whatever', and keep indulging in the way of life that was the impact in the first place.

Bill McKibbon is a classic example - urging folk to de-share from oil companies. Actually, all you have to do, is not buy their products............ but that is apparently not on the agenda - too inconvenient. It's gonna be an interesting next few years - something tougher than mainstream Green has to emerge, and rules have to get very much tougher, or we're into Mad Max territory and all bets (some call them 'investments') are off.

This one frames the big picture, better than most:

http://www.openfuture.co.nz/unsustainability/meaningofsustainability.html

go well

by Ralph | 30th Aug 13, 4:09pm 1377835781

You do realize that the article you linked to clearly states that peak oil is still a problem right!? Here I was thinking you were scientifically illiterate.

A simple URL link to an "approved" site is all it takes. Amazing. All this time I had thought to get scientific approval would involve at least a secret handshake.

Somehow I'm disappointed.

by Christov | 30th Aug 13, 4:24pm 1377836647

Now come on Ralphie.....I wasn't being capped into the club by that and you know it, your just baiting .....

Yes I am scientifically illiterate by comparison to our resident messengers, but I don't need a science degree to tell you that if the demand from y growing expotentially exceeds the supply capability from x finite.......I'm either going to get real creative or have a lot of dead y's to clean up.

ya scamp.

by Ralph | 30th Aug 13, 4:39pm 1377837598

I wasn't being capped into the club by that..

Maybe just a light hug then - ;). It is like a club though, as you must have noticed.

I do know the theory. But I also know that in theory, theory and reality are the same, it's only in reality that theory is different.

by Plutocracy | 30th Aug 13, 4:49pm 1377838142

Come on Ralph, quit trying to stir the pot! I was just pointing out the absurdity of someone harping on about ''peak oil dead / mathusian that" linking to a webpage that doesn't even support his view! I'm concerned this is indicative of the depth of reading he does - none.

by Ralph | 30th Aug 13, 4:55pm 1377838514

Whaaat, no pot stiring on interest.co.nz?

Have a good weekend.