Obama's go at bogus bank fees; The peoples' revolution; U.K. pension pains; Separating prediction from fact; The very long arm of the IRD

Obama's go at bogus bank fees; The peoples' revolution; U.K. pension pains; Separating prediction from fact; The very long arm of the IRD

By Amanda Morrall

1) Obama tells off the banks

U.S President Barack Obama's tough tax talk and jobs plan speech was interesting for a number of reasons but my ears perked up when the issue of bank fees (38 minutes into the video) came up. Bank of American customers have been fuming about being charged a $5 a month fee for using their debit cards (the U.S. equivalent of EFTPOS).

Obama chided the banks about nickle and diming their customers without properly explaining all the whys and what fors. He also warned them that the Consumer Finance Protection Bureau would be taking a tougher stance on issues of disclosure, transparency and accountability.

An apparently affronted reporter accused Obama of trying to dictate profit margins to which the president replied that the banks should be keeping their customers based on quality of service and price rather than handcuffing them with products they bought into while effectively blindfolded. Score one for Obama.

2) A Sane Revolution

On the subject of public revolts, take a moment to read this opinion piece from the Economist on the Wall Street sit-in.

It's a lively and unexpected piece applauding the activists for taking a stand, making a fuss and being heard outside of the echo-chambers of the virtual worlds in which most of us now lead our lives.

He quotes from D.H. Lawrence's "A sane revolution" and then build on the themes.

For those too lazy to click and read here an excerpt.

A Sane Revolution

If you make a revolution, make it for fun,
don't make it in ghastly seriousness,
don't do it in deadly earnest,
do it for fun.

Don't do it because you hate people,
do it just to spit in their eye.

Don't do it for the money,
do it and be damned to the money.

Don't do it for equality,
do it because we've got too much equality
and it would be fun to upset the apple-cart
and see which way the apples would go a-rolling.

Don't do it for the working classes.
Do it so that we can all of us be little aristocracies on our own
and kick our heels like jolly escaped asses.

Don't do it, anyhow, for international Labour.
Labour is the one thing a man has had too much of.
Let's abolish labour, let's have done with labouring!
Work can be fun, and men can enjoy it; then it's not labour.
Let's have it so! Let's make a revolution for fun!

Writer adds:

Or do do it for money, equality, the working classes, and international labour. Whatever. Do or don't make yourself useful, but don't waste life clucking at the internet and waiting around til "Parks and Recreation" comes on. Get out there and and stick it to the plutocrats. Stick it to the socialists. Stick it to the fall prime-time lineup. Stick it to not sticking it. Go ahead. Occupy Wall Street. Occupy yourself. Live a little. Woo!

3)  Quantitative easing a pain for pensions

The Bank of England is warming up its printing presses again and plans to put another £75 billion into circulation to kickstart the ailing economy.  The National Association of Pension Funds warns the move will have negative repercussions for pensioners.(See Guardian Money story for details)

So far the £198.3 bln already spent has gone toward buying back gilts – bonds issued by the government. This has the effect of pushing up their value and decreasing their yields which means less money for retirees.

4) Get your game on

It's hard to go a day without being bombarded with bad news.

If it's not Greek debt dramas, contagion fears in eurozone or the ticking time bomb of U.S. debt, it's terrorism or natural disasters.

You'd have to be deaf to ignore the "short-term" noise which is what cooler heads are suggesting investors do to avoid causing themselves unnecessary harm.

Experts are full of advice but how often are they right and is their advice worth heeding?

Forbes Money suggests taking a deep breath, separating prediction from fact and sticking to plan.

5) Tax hounds

I can't escape the feeling that I am being beaten over the head with the immutable fact of life about the only two certainties in life: death and taxes. I base this on the fact that I've been assailed with tax stories lately. Non-stop.

For those who might have missed it, the New Zealand Herald carried this story about the "scary" new powers of the IRD.

And if that doesn't make your blood boil, you might want to read Terry Baucher's latest column also highlighting the long arm of the IRD.

Hope I haven't spoiled your weekend. Think of it as short-term noise and then buy some earplugs or maybe crank up the iPod.

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#5 - What is all the fuss about?  Doing Stage 3 tax at Auckland Uni back in the late 90's we were told the IRD had the most power of any organisation in NZ, they could search, sieze do what ever they wanted to get the tax

And that makes living in their Police State, no privacy, no freedom, acceptable? Because you learned about it at Uni?

my point was, why are we now suddenly 'shocked' by the powers of the IRD?  They have had them for years & years.  It's not like the Government passed new laws giving them power & never told anyone about it.

Actually, over the last year IRD have been granted new powers that are frightening, especially around the access they now have to taking money from your bank accounts (and you won't even know). Plus a compliant judiciary who have bought into the ethic that the individual must be sacrificed to the many, in a complete reversal of the ethic of 1776 and a sanction of 1984, are allowing IRD to write tax policy, effectively, in a most repressive, literal and cruel manner.

The thing that steams my bean is that unless you're making a massive salary and can afford to have an expensive accountant then there's is no incentive to work hard, get ahead but for the love of the work. Also,  I wouldn't mind so much if I could allocate my tax dollars. 

That's because you're a classical liberal at heart, Amanda, who wants to be free to spend your income on what you choose, including charities of your choice. Individuals make better decisions regarding their own, and their families, circumstances, than governments and central planners ever can. North Korea is now rationing it's population to 200grams of protein only per day.

And regarding expensive accountants, now that the classical liberal ethic that existed in the Westminister Rule (1936) is overthrown by our judges who believe the State is your master, and mine, you're wasting your money. Everything they do for you will be classed as tax avoidance: we're all just slaves now, and IRD makes tax policy, not government. I suggest everybody stops using accountants, why bother? Much better to kick the necessary revolution off by every single business person taking their apple box of receipts to their nearest IRD office and asking them to complete their tax return. Destroy the system by completely bogging it down in paperwork and so bring on the national bankruptcy all the quicker. Clean slate - start over.

Ya reckon. I always prided myself on being undefinable but age and experience are positioning me on the spectrum I guess. My tax file sits with me now, and I am making small inroads. Prefer to be planting apple trees. But funny you mention the crate, which serves as my filing cabinet. Revolution chique.:)

As a farmer, the dropping of the QC regime, restrospectively (Double Dipper announced it in May 2010, but the last time you could have elected an existing company into regime, therefore, was March, 2010), has potentially much greater issues for you if you use a company anywhere in your structuring.

See my post here at 4.20pm, 8th October.

To the example given - mom and pop diary company can't sell herd to son - a company can now not sell any capital asset to an associated party (including family), without triggering a tainted capital gain (taxable on liquidatiion of the company). All these transactions you can do with total strangers to no disadvantage, but the income tax act now squarely disadvantages you transacting with your own family.

That's life in the Police State - a police state Bernard wants to give more and more power to. We're way past time in the Western social(alist) democracies for a Spring revolution of our own to classical liberalism - get rid of the politicians, and take the police state powers away from IRD.  (You might find my two comments posts to that thread of interest also).

Child Support is different. What you describe doesn't sound like an audit to me: I suspect your ex has put you up for an administrative review. Under that, IRD truly can do anything they like, including ignore completely all legal structure that you have, and you can't even have professional representation.

I'll go two ways on this, one of which will annoy you :)  The police state powers that I have just described in the above paragraph are stunning and alarming - not even being allowed to have professional representation in the IRD administrative review interview is quite extraordinary. To get to a classical liberal society, those type of blanket powers cannot be held by any government department for any reason. (But on the other limb, if you're not paying the full amount to bring up your kids, and assuming no private arrangements - full sympathy if you have those - then you're expecting me to pay to bring up your kids, and I don't even know you, or them.)

Child Support, as administered by the IRD, is a doddle. You do not have to attend any Administrative Review, if you choose no to; If you do, you do not have to provide any details of your assets or income, if you choose not to ( It will be called for, but just ignore it); any judgement coming from the review that you disagree with, ignore it. Unless you are a PAYE earner, it's a matter for your accountant to ensure there is no source of income to be docked. Then; when your wife takes a legal action against you in the Family Court, for all that you have not paid, you can have that legal representation that Mark notes is missing from your earlied discussions. By now, you will have used up, say, 2 years. During the following 3 years, arrange your affairs so that you, personally, can become bankrupt. The Child Support outstandings remain with your old IRD tax number ( you will get a new one with bankruptcy) and your  Child Support debts , that in theory 'never go away', remain unpaid...

Mmm. In absence of a classical liberal society which is the true fix for issues such as this, I reckon I don't want someone going to so much trouble to welsh out on paying to bring up their own damned kids, Snarly. It's a life choice to have kids, which doesn't end when you split from the ex. And why expect me, a total stranger, to pay to bring your kids up for you?

You can't rail against the welfare state, anyone, then take this stance. You've got to start by being responsible for the seed from your own loins, and paying for them (and loving them, and if you're not paying, then how are you loving ...?)

I couldn't believe what I was hearing with Obama's speech.  In a good way.   

There is an arrogance attached to money and unncessary sophistry which makes it murky for the masses - this is on purpose and at the direct expense of everyone else.  Obama's picked up on this and, like the rest of us, he's had a gut's full.

We all remember as children playing with the spoiled brat down the street who had the best toys.   If you played with him, he may change the rules mid-game when things weren't going his way.  Bullet-proof vests would suddenly appear when none were apparent before.   After a while, no-one would play with him because often he would have a tantrum, snatch all his toys back and storm off.

As adults, they are a bit more polished (but not a lot more).   If you question or disagree with a pronouncement, an amused frown plays on their face - as if you have suggested that sausages actually grow from the ground.    If you politely push, you get a precis of their previous achievements - as if that is an answer in itself.  

Yes, Obama is talking about Wall Street, but looking closer to home the same patterns are apparent here.   Noble exception - Alan Bollard, who seems keen to explain things and appears open to other points of view.  









"As adults" yes very true, I think their are two "sorts of adults", risk takers, always positive always can do...these win well short term but can crash in a big way when things go un-predictable/volitile.....but ppl see the winning and often the "always positives" surround themselves with like minded ppl......where I always fallout is they dont seem to accept the failures/faults as theirs, its always someone eleses failures or inadequacies that caused their fall...yet they are often lacking in depth and knowledge....this is what trips them up.....

Then there are the conservative types, low risk, circumspect....tend to qualify a lot when looking at unknowns and spend a lot of time gaining depth and knowledge.....(thats me btw) but tend to be ignored.....oops ah well.....

When you have money to spend, and have 2 ppl in front of you and one promises the moon in a week or one says maybe and some months, which do you choose?  If you are the former personality you go with the former every time....

Sooner or later of course there are huge f*ck ups......and then the latter get paid to fix the formers mistakes.......funny that....never mind.....in a a few weeks or so I'll get 1 year's solid work or in 6months.........2 years work unfixing it all....


Alan Bollard, I agree, thank god we have him IMHO. If he gets about 12months to get the "living wills" in place we may just not get saddled with the huge private debt that will unfold.....not sure he'll get that long however.


#4 Forbes & Sticking to plan.....as Paul Krugman says, in the last few years listening to the WSJ editorial would have cost you a lot of money....

I am gob smacked by this "quality" (not) piece.....crash and burn comes to mind.


posted in the wrong place :-)