g8mandate
A blog geared for eclectic commentary on socio-economic affairs…flavoured with a hint of tongue-in-cheek spice and acidic bite.

Sovereign Debt: We were warned

     Posted on Thu ,27/05/2010 by Preecey

I noticed this article from a January 2009 edition of  The Wall Street Journal by Ulrich Volz http://tinyurl.com/dbf86f

He was warning fifteen months ago about the contagion of  debt not being limited to the Eurozone alone.

According to ING Wholesale Banking, emerging-market governments and corporations need to repay some $6.8 trillion of debt, including bonds, loans, interest payments and trade finance. All these sums mentioned do not include the debt that these countries would need to take on if they were to try fiscal stimulus like the industrialized countries plan to do.

I guess at the time it was just another forecast based on limited credit access…I wonder what we’re glossing over today that we’ll be focusing on in fifteen months time?

European Commission: Financial stats by member territory

     Posted on Wed ,26/05/2010 by Preecey

Here’s an interesting set of stats from the European Commission. http://tinyurl.com/363lxrk If you drill down into the PDF files by Territory you will see Government Debt as a % of GDP. Looking at 2011 forecasts, Greece stands at 134% and Italy 119%…they’re the only Territories above 100% but Germany, France, U.K. and Portugal are all over 80%.
The horrors are going to be with us for some time yet.

World Competitiveness Data 2010

     Posted on Fri ,21/05/2010 by Preecey

Annual chart and commentary from the Swiss International School of Management Development. New Zealand has dropped from 15th to 21st amongst the world’s most competitive nations but that’s still ahead of UK 22nd and Ireland 21st so I guess we’re managing to punch above our weight. The Aussies are sitting proud at number 7 but even they have dropped a couple of slots from last year!

Criteria includes strong economic performance, implementation of efficient policies, low defecits, debt ratios, unemployment, and inflation with high export position. See the global chart here:- http://www.imd.ch/research/publications/wcy/upload/PressRelease.pdf

Also find the school’s introductory video to the research data.


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Euro Zone’s sovereign debt

     Posted on Mon ,17/05/2010 by Preecey

Really interesting perspective on the current Euro-crisis from German based Der Speigel. A graphic of the Euro-zone’s sovereign debt issues should do enough to terrify you! http://tinyurl.com/29bp2jc there are nine graphics in the gallery set. I recommend viewing them all. Makes a mockery of the Maastricht agreement which requires member states to peg budget defecits at a maximum 3% of GDP. Current average defecit = -6.9% and that’s WITHOUT Britain’s(non-Euro) figures being included.

Garth George….read him and weep.

     Posted on Thu ,25/03/2010 by Preecey

As an “En-Zed-centric” commentator I try, as my blog-header suggests, to be as eclectic as possible by not posting issues which solely focus on domestic prattle. BUT one cantankerous buffoon who drives me to distraction, regularly turns my high-minded intentions into ‘Mission Impossible’.

God-botherer, bigot and sanctimonious codger…Garth George…take a bow.

I’m sure The NZ Herald includes his weekly diatribe as a marketing ploy for boosting sales because he’s the kind of excuse for a journalist that you want to read just to inspire you to write to the letters page to complain…a kind of literary Ossie Osborne who you don’t want to miss in case he manages to out-do his last monumental act of grossness!

Mr. George is the kind of geriatric “know-all” who you would imagine as a distant uncle; the kind you only meet once every three years and immediately realise you would prefer his cycle of appearances to be in line with Hayley’s Comet.

Last week’s rant [ http://tinyurl.com/y9mgb3t ]was all about John Key’s government losing its way and how he sees open-cast mining in some unused square kilometre of Aotearoa’s ‘clean and green’, as a perfectly acceptable route for economic prosperity…if condescension was an olympic sport, old Garth would be a gold medalist.

Naturally, opponents of the scheme – Greens, sundry other tree-huggers, bird-watchers, bug-lovers and whale savers – are up in arms.

This week Garth’s dissing Budget Airlines in such a derogatory manner that I’m half expecting (make that hoping)Virgin Blue and Jetstar will file for defamation. [ http://tinyurl.com/ydad5kt ] How the rickety old fool can make such sweeping comments after openly admitting he never flies on a budget airline, only goes to underline his total lack of credibility as a social analyst. Cop this for a quote:-

If I buy a budget seat on a budget airline, then it stands to reason that I’m buying into a budget airliner with budget fittings and equipment, budget staff and budget service, budget training and budget maintenance – in two words budget safety.

Well I just flew with Virgin on a round trip from Auckland to Wellington and there were seat-belts, flushing toilets and a fully coherent flight-crew who managed to land a Boeing 737 in a howling gale without losing a single wheel.

NZ Herald…anyone who starts a piece with “why oh why” and pontificates  like a conclave of cardinals (mostly from a pulpit of ignorance) is worse than irritating…the geezer’s obviously dangerous…can’t you just farm him out and do us all a favour?!

$1m = 1 pixel

     Posted on Thu ,18/03/2010 by Preecey

Been way too long dear reader! Hope to be back in the saddle very shortly.

Couldn’t resist this one. Just puts into visual perspective the profligacy of the U.S. financial situation.

http://i.imgur.com/C5hAo.gif

pitiful isn’t it?!

The measure of analysis

     Posted on Tue ,23/02/2010 by Preecey

If you are arrogant enough to believe that your views on life are so interesting and attractive that, for the posterity of man, you must divest yourself of their gem like qualities on a blog; then graciousness is not high on your ample set of life-skills….and I should know!!!

However, every now and then a scribe with erudite insight catches a mere blogger off guard and renders him momentarily incapacitated…why? Because a blogger (like me) tends to believe that he is the only one who “sees, hears and tells it, as it really is” and that anyone paid by the media to commentate on the same couldn’t possibly apply such self-effacing equanimity.

To come across one such example in a week is rare, to find two…downright ridiculous! Step up Tracey Barnett and Tapu Misa.

I have to admit I have sheepishly admired Tracey Barnett for some time and her excellent web site is one of the few I link to here at g8mandate.  Last week on her web-site (and replicated as a piece in the N.Z. Herald) Tracey admitted to feeling an ire which serves as fuel-rods to most bloggers’ overheated note-books.

She tells of the “out of whack priorities’ that platform “the facts”, as manipulated by the baying hounds of the media and that commentators are so beholding to the zeitgeist of the daily “feed” that true analysis is deemed to be inconsequential, at least when compared with the massed adrenalin rush of championing winners and stringing up losers.

See the entire piece here http://traceybarnett.co.nz/recent.htm

If you have read the narrative, you may note that Tracey referred to a sampling of the media’s take on the waning popularity of Barack Obama’s “doomed” Presidency.  She noted that Obama had in fact achieved a 96.7% pass rate for the rate of bills passed in congress during his short tenure which was higher than any other President in five decades of recording such data.

She asked:-

“What would have happened if pundits used the  rate of bills passed in Congress that the President had come out to support?”

By this inference Tracey is arguing that an outcome can be manipulated to prove just about anything, providing you start with an appropriate set of analytical data…which somewhat clumsily leads me on to the second piece of journalistic insight in a week!

Cut to Monday’s N.Z. Herald and a header entitled “It’s time to measure what really matters” by Tapu Misa  http://tinyurl.com/yfmflzp

It was as if Miss Misa was carrying on where Tracey left off.  This time it was the analysis put forward by economists regarding the substantiation of measuring our societal worth based on the sole data exhibited by G.D.P.

Tapu noted how the Commission on the Measurement of Economic Performance and Social Progress had reported that for all the spectacular corporate results of the last ten years, it was in fact a “decade of decline for most American’s”.

I guess when it comes to analysis…it all depends who is doing the measuring, what kind of sextant they’re using and what set of charts they’re referring to…and (as Tracey Barnett might say) which of the myopic sheep out there commentating, can be bothered to find out.

N.Z….international financial hub??

     Posted on Tue ,16/02/2010 by Preecey

I noted that John Key recently fell off his well upholstered fence and actually forwarded an innovative economic proposal. According to Audrey Young in the N.Z. Herald  http://tinyurl.com/ydhpzbg

“Prime Minister John Key wants New Zealand to become an international financial hub specialising in the administration of overseas pension funds”.

Key thinks N.Z. could replicate Luxembourg or Ireland in accommodating “back office” and administrational tasks on non-resident funds registered in New Zealand. The fund’s subscribers would attract zero tax but the management of the fund would render appropriate fees for New Zealand’s finance sector.

As the “deal” may have some legs Craig Stobo “Chairman of fund management administration business Appello Services” has quickly jumped in to claim it was his idea all along and explains in today’s N.Z. Herald how relatively simple it would be to put in place. http://tinyurl.com/yknkzyz

Apart from looking to replicate the erstwhile Financial-Hub of Ireland which is currently lining up on the grid just behind Greece, in the qualifying event for the I.M.F. grand prix; and the deplorable record of New Zealand’s ability to regulate its own financial funds, everything seems to be relatively breezy for N.Z. to step up to the plate!

For me…what would really clinch foreign funds to align themselves with N.Z. would be for a slice of “managed” revenues to go towards the much vaunted Robin Hood tax. Imagine the International kudos N.Z. would reap if we could be the world’s first territory to augment this noble plan?

I urge you to view the Robin Hood website. http://robinhoodtax.org.uk ..it features a video with Bill Nighy portrayed as a squirming bank manager which is priceless!

Lesson in freeing debt…agility is the key.

     Posted on Mon ,15/02/2010 by Preecey

Despite bankers,  real estate agents and used car salesmen telling us thru clenched smiles that…”everything in the garden is rosy so its O.K. to buy up large again”; there remains a stoic band of non-believers who refuse to be drawn into the “hall of mirrors”. Obviously I have been picketing the “fairground” entry for some months but its gratifying to see that I’m not entirely on my own…here’s a wry snippet from a colleague in London.

It is the month of January. It is raining, and the little town looks totally deserted. These are tough times, everybody is in debt, and everybody lives on credit. Suddenly, a rich tourist comes to town.  He enters the only hotel, lays a 100 Euro note on the reception counter, and goes to inspect the rooms upstairs in order to choose one.

  • The hotel proprietor takes the 100 Euro note and runs to pay his debt to the butcher.
  • The butcher takes the 100 Euro note, and runs to pay his debt to the pig farmer.
  • The pig farmer takes the 100 Euro note, and runs to pay his debt to the supplier of his feed and fuel.
  • The supplier of feed and fuel takes the 100 Euro note and runs to pay his debt to the town’s prostitute that in these hard times, gave her “services” on credit.
  • The hooker runs to the hotel, and pays off her debt with the 100 Euro note to the hotel proprietor to pay for the rooms that she rented when she brought her clients there.
  • The hotel proprietor then lays the 100 Euro note back on the counter so that the rich tourist will not suspect anything.
  • At that moment, the tourist comes down after inspecting the rooms, and takes his 100 Euro note, after saying that he did not like any of the rooms, and leaves town.

No one earned anything. However, the whole town is now without debt, and looks to the future with a lot of optimism…..And that, ladies and gentlemen, is how the UK Government is doing business today.

Amusing annecdote but don’t quite know how it works without the town being the size of Warkworth and its inhabitants all being fitted with skateboards!

Housing N.Z….which way is up?

     Posted on Fri ,12/02/2010 by Preecey

As New Zealand’s socio-economic barometer appears to function predominately on the meteorogical pressure of housing sales and house prices, I was somewhat bemused to read in today’s NZ Herald http://tinyurl.com/yd9v8fc how Anne Gibson quoted Shamubeel Eaqub, an economist at NZIER, on the 17% fall in January’s house sales.

“The volume of sales is very similar to the lows we saw in 2008. This is deeply worrying”

Why bemused? because only a month ago the same guy was being quoted (again in the Herald http://tinyurl.com/yc59ts5 ) as saying

“House prices are showing renewed over-valuation….. a correction in the housing market is necessary to reduce the economy’s vulnerability to house price movements”.

So we’re deeply worried that sales are down, while at the same time advocating a correction in the market? Confused?

Well let’s see what  Barfoot’s Real Estate M.D. Peter Thompson, was quoted as saying in December:-

“Housing had returned to being viewed as a sound, medium to long-term investment option”.

While a month later, again Mr. Eaqub is quoted as saying:-

“There is suddenly a flood of unsold homes”.

Guys guys! Lets get the ducks in a row…up, down, soaring, plunging…any phrase we should bet on here? Can’t wait for February’s instalment.