Weekend Links 21st – 22nd Sept

ScreenHunter_01 Apr. 02 06.19

Global Macro/Markets:

  • Global Equity Funds Record Biggest Inflows Since at Least 2005 – Bloomberg
  • Fed’s Guidance Questioned as Market Misreads Signals – WSJ
  • Emerging markets catch a break in the no-taper decision.  – NYT
  • Market Unhappy After Bullard Suggests Possible Octaper – ZH
  • JPMorgan Guilty Admission a Win for SEC’s Policy Shift –Bloomberg
  • Hank Paulson warns of regulatory conflict  – FT
  • Buffett Says Federal Reserve Is Greatest Hedge Fund in History – Bloomberg
  • Missing the forest for the QEs – The Economist
  • Our chat with Jeremy Grantham – WSJ

North America:

  • Hurdles Are Still High for a New Fed Front-Runner – NYT
  • Homebuilder and mREIT stocks nosedive – Housing Wire
  • The Era of Cheap Gasoline is Over – OilPrice
  • Pricing Glitch Afflicts Rollout of Online Health Exchanges – WSJ
  • Don’t underestimate this Fed’s dovishness – Gavyn Davies
  • Pushing off the taper increases the importance of the new Fed chair.  – Economist
  • AAR: Rail Traffic increased in August – Calculated Risk

Europe:

  • Merkel fights for majority in tight election race – Irish Times
  • Latvian Adventures – Krugman
  • Austerity seen easing with change in EU budget policy – WSJ
  • Nazi Murders – and what to do about them – Yanis Varoufakis
  • How a German tech giant trims its U.S. tax bill – Reuters
  • Despite Merkel’s Popularity, Angst Creeps In – WSJ
  • Banks in Spain, Italy look for relief in accounting – WSJ
  • EZ GDP since Q1 2008 – Cigolo
  • Venizelos to Asmussen: let’s ’reorganise the figures’ – Enetenglish

Asia:

  • Japan LDP Considers Draft Bill to Put Government in Control of Fukushima Cleanup  – WSJ
  • Rajan Surprises With India Rate Rise to Quell Inflation – Bloomberg
  • Hedge funds are coming to China –  Dealbook
  • Japan Condo Sales Running High on Abenomics – WSJ

Local:

  • Abbott: Open for business – And Multinational lawsuits – The Global Mail
  • NT government wants GST to remain at 10% – TheOz
  • ‘Remember what happenned to Skase’ – SMH
  • Victoria the most expensive place to retire – TheOz
  • Palmer leads in Fairfax, recount looms – TheOz

Other

  • Rover challenges Mars life theory  – BBC
  • Pope Says Church Is ‘Obsessed’ With Gays, Abortion and Birth Control – NYT
  • Do Syrian Rebels Have Sarin? –  Consortium News
  • The quality of Jobs: The new normal and the old normal – NYT
  • iPhones 5C/5S launch: Record crowds at Apple’s 5th Ave. Store – Apple 2.0 – Fortune
  • Playing starcraft 2 might make you smarter – TechCrunch

Comments

    • Just spotted this on housing

      http://www.canberratimes.com.au/act-news/tenants-buy-way-out-of-eviction-20130920-2u5r7.html

      ‘The move was criticised by public housing and welfare advocates, but former housing minister Joy Burch pushed the new rules through, arguing the accommodation should be provided to needy families, not middle and high-income earners.
      Research undertaken by Housing ACT in 2012 of its tenants paying full market rent found 208 tenants in public housing were on household incomes of more than $80,000.
      These included 43 tenants who declared income of more than $100,000.
      Three households earned more than $140,000. One household was occupying a government-owned house despite having an annual income of more than $240,000. The latest round of research has found more than 100 households with gross annual incomes of more than $100,000 living in government-owned properties.
      A couple with a child would not be considered for social housing if they earned more than $49,000.’

      • Yes, it is reminiscent of the good old USSR way of doing things. New & flashy (by the Soviet standard that is) housing units did not go to those with most money (that is not a communist way of doing things you know). Who should receive them was decided by a “fairly conducted” lottery. But somehow those who ended up receiving these units appeared to be well connected to the Communist party…. I wonder why … could it be that the lottery was rigged?

      • “The move was criticised by public housing and welfare advocates”

        These advocates are clueless, aren’t they (or, more likely, are they connected to those well-off residents and hence stand to benefit from status quo)?

        The governments should sell the public housing stock to “bring the budget back to surplus” unless the following questions are adequately addressed;

        (1) Who decides (makes the rules of) who will benefit from public housing and How?
        (2) How to enforce these rules?
        (3) What are the compliance costs of enforcing these rules?

      • These advocates are clueless, aren’t they […]
        So from a bit of quick googling, the “advocates” were worried about:
        * keeping a mix of socio-economic groups in public housing (ie: trying to avoid creating slums)
        * providing a disincentive to people moving into higher-income jobs

        There’s some validity in the first, but it’s better addressed by having public housing spread throughout the community, IMHO, rather than trying to have the community spread throughout public housing.

        The governments should sell the public housing stock to “bring the budget back to surplus” unless the following questions are adequately addressed;
        Once the public housing is sold, where do you propose the people who need it live ?

      • @drsmithy

        You are missing my point. My point is that there needs clear accountability for those who decide who will benefit from public housing (otherwise they will just allocate them to their mates, as they did in the USSR).

      • You are missing my point. My point is that there needs clear accountability for those who decide who will benefit from public housing (otherwise they will just allocate them to their mates, as they did in the USSR).
        Well, I don’t disagree with that at all, but there does not _appear_ to be evidence it is happening (at least from the reading I”ve done).

  1. A funny thing about those who jump into the great housing bubble is that they appear to reason along the lines of; an outsized investment in roofs is justified because one will forever need a roof over his head. True, but roof is hardly the only item one will need forever; we will all forever need energy, food, clothing, etc. The more one spends his funds to a specific need the less he will be left with for the other needs.

    National median house price in September 2011 = $536k

    What $536k would have bought in September 2011 = 5000 shares of WOW + 5000 shares of WES + 3000 shares of WPL + 3000 shares of ORG + 50000 shares of TLS

    I wonder which pile is more valuable…..

      • And your ROI, cap gains aside? I don’t have a problem with housing as an investment but the current system if flawed to the roots…

      • yeah flawes system indead, owneroccuped house is almost a tax free investment and leveraging is dirt cheap for housing unlike margin (which is also limited), in your example you would not have been able to buy as much shares with the same deposit ( i dont think your buying your house cash 😉 ).

        so far, it s good and safe ( houses do not go bankrupt).

        and using your offset as saving account is pretty good.It s nice to have mortgages.

      • @dumpling

        I think you should stop trading 😉 even with the help of hindsight your portfolio is not even back to his pre 2008 level.You can choose a date jsut after the 50% crash but since this type of crashes happen quite regularly now on share market, it s not too reasonable( but went nowhere since 2009 nop matter what)

        Margin would cost you 3% more and you can only borrow a fraction of shares.$536k would have bought you $2.6M of IP ( and you usually do not NG shares + no depreciation !), even if you bought in 2009 you could be sitting on a nice pactol.

        investment in houses in Australia is hard to beat for the long term.

        of course all that is silly arguments and oversimplified but you get the point 😉

      • @dam

        Well, if your portfolio today is any less than what it was 5 years ago, then obviously you did not know what you were doing, so you should not be trading (unless you learned something new).

  2. Mining BoganMEMBER

    I came in to link that Global Mail story about ISDS. It’s way beyond my expertise but what do we have to gain out of leaving ourselves open?

    There’s a rumour that our Tony was a boxer, albeit not a very good one. But even he should know that a good defence wins the fight for you.

    • MB,
      i also read this article and was outraged that tony was prepared to “bend us over” all for the sake of a few headlines to say he was getting the country back on track.
      Bloody hell even little Johnny back in the day knew the ISDS agreement clauses only benefited american big business and that even if we win the “good ol tax payer” still loses.
      If they want to do business here it should be on our terms otherwise @#$% off!

    • Welcome to open, honest and transparent adult government.

      “Immigration Minister Scott Morrison’s office has clamped down on information about asylum seekers issued by his department and border protection agencies.

      Previously, the Australian Customs and Border Protection Service has issued statements whenever an asylum-seeker boat arrived and the Immigration Department provided collated figures each month, which they made publicly available.

      But inquiries to both the department and ACBPS on boat arrivals are now being directed to the minister’s office. Mr Morrison’s spokesman is declining to provide any information.”

      • Perhaps we are going to see more action and less public melodrama. Cant be a bad thing.

        I find it hard to believe that the arrival of a new boat will be able to be kept compleatly quiet. The information will leak from somewhere.

        I for one would prefer a goverment to quietly go about their business with out the big hoo ha from the peanut gallery every time they attempt to implement anything. The last govt was a good example of populoust politics in action.

        Ill reserve my judgement on their actual achievments.

        At least they are commiting to their promise of a small government.

        http://www.smh.com.au/federal-politics/political-opinion/dont-feed-the-chooks-tonys-taken-politics-out-of-our-faces-20130920-2u535.html

      • “I for one would prefer a goverment to quietly go about their business with out the big hoo ha from the peanut gallery every time they attempt to implement anything. The last govt was a good example of populoust politics in action.

        Ill reserve my judgement on their actual achievments.”

        Let me preface this by saying that asylum seekers aren’t a huge issue one way or the other for me.

        However if a government is elected partially based on a promise to “stop the boats” and the first thing they do is change the reporting methodology then I immediately become suspicious.

        I don’t trust governments of any political persuasion and will always argue for more open government, not less.

        And of course a large part of the previous peanut gallery was the Coalition.

    • They only got sworn in a few days ago….

      I don’t believe a reasonable person would start the hue and cry at this early stage.
      Seems pretty one eyed to me.. Just saying…

      • Mining BoganMEMBER

        *sigh* Nobody ever called me one-eyed when I bagged Rudd and his lot.

        “Open and transparent government”. Something like that. Yet there is messages going out to his ministers to not speak to the media. Much like candidates before the election were ordered to do the same. The boats thing is unimportant and everyone knows it. It’s the secret squirrel stuff that has to be avoided.

        But I can see why they want to do it. Our Tony and his trusty sidekick, the Member for Mesothelioma, have been insulting those nice Indonesians for months now. Probably not a good idea.

      • There is a big difference between open and transparent & attempting to run a govt from the big brother house. & most grown ups don’t expect politicians to mean and do everything they say. Not unless you still believe in Santa and the tooth fairy.

        Of course they will lie, back-flip, and display all the rest of their breeds traits. The thing about democratic politics is that in order to maintain a balanced social order the government must swing like a pendulum between one extreme and the other.

        We have had our feel good spendthrift govt who have championed the cause of the unfortunate and who have relaxed the purse strings and now its time for a bit of discipline and trimming of the fat. In time this government will start taking things to far in that direction and the pendulum will swing again.

        Democracy really is the worst form of government, except for all the others.

      • Mining BoganMEMBER

        Of course they backflip. I only ask for an explanation as to why they do so.

        Look at this rubbish in the free trade agreement with the ISDS clause. That can only hurt OZ. They’re the things that should be out there, not hidden away.

        Secrecy in Government scares me.

      • I’m guessing its actually pp14-15. It’s a two page spread with the headline ‘Toxic Property’, outlining the risks of house price inflation with a low interest rate, high Aussie dollar environment. Plus the unregulated smsf property spruikers get a mention.

      • Yeh csfn nailed it – how bizarre that more and more msm are getting worried! Even a call for asic to regulate!!

      • This is extraordinary – and i reckon someone over on the retail thread has nailed it. The non-usury businesses are finally starting to cotton on that low rates don’t mean more money for them any more, they just mean more money for banks.

        Could the great alliance between the media, the usury industry and big industry be starting to fracture?

      • Is this the Chris Joye effect? When he was pro-property (if you want to call it that) so where MSM. Now he is concerned, MSM are following as well?

      • “Is this the Chris Joye effect? When he was pro-property (if you want to call it that) so where MSM. Now he is concerned, MSM are following as well?”

        I am guessing that Darth Stevens may not be impressed with this great disturbance in the Force. We may see some smear campaign that tries to discredit Chris Joye.

  3. Mr Gittins missing the point again.

    “Some people, remembering stuff their heard in the 1970s and ’80s, worry that ”printing money” causes inflation. It does if it causes demand to exceed supply – as would have been the case back then – but it doesn’t when demand is a lot weaker than supply, as has been the case in the North Atlantic economies since the global financial crisis.”

    http://www.smh.com.au/business/qe-inaction-throws-spanner-in-our-works-20130920-2u57a.html#ixzz2fVf724ii

    There are very good reasons why demand remains soft 6 years after the end of a massive debt boom. The level of demand 6 years ago was artificial and not sustainable and all we have seen is a return to a more sustainable level of demand.

    In that circumstance expanding the money supply enormously and inflating the prices of certain assets has been a waste of time and not ‘playing for time’.

    At best the attempt may induce some froth while loading more debt into the system.

    Unfortunately for those still searching for a painless solution to an asset price bubble – the best solution remains right in front of us.

    Stop pumping air into the punctured tyre, allow the prices of assets to deflate and use all the powers of govt to manage the painful adjustment and yes that may mean nationalising banks or setting up new publicly owned banks that advance loans for productive investment rather than asset speculation – the “Real Commonwealth Bank” has a nice ring to it..

    People forget that the reason the last great deflation in asset prices (1930s) was so painful was that the size of government was a lot a smaller and less sophisticated and there was a very limited welfare state to provide income support to the general population.

    People don’t starve because asset prices are falling. Food doesn’t stop growing because asset prices are falling. People who own their assets without debt do not get evicted. Houses that are repossessed can be bought by new owners (perhaps the govt) or let to new tenants at lower rents.

    The government is quite capable of directly supporting the money supply and the level of demand for the daily necessities while the level of debt and the machine that drives it withers.

    That is the power of a fiat currency.

    If nothing else we have a very well developed safety net that is quite capable of depositing ‘accounting entries’ directly into the accounts of the general public instantly. That would seem a more direct and useful action than depositing accounting entries into the corporate accounts of banks and praying that the effect on asset prices conjures up the confidence fairy or some mishapen wealth effect.

    Of course some useful public works are always an option – build houses and roads and transport links etc that make it easier for people to be active economically.

    Clearing out the debts after a clueless asset bubble enabled by the RBA and others is exactly what our safety net was designed for.

    But if Japan is any guide we will be having this debate for another 15 years.

    After all, a direct solution to the problem of excess debt means shrinking / liquidating the primary asset of our mega banks and you can expect that their pet PR poodles, army of retired polly lobbyists and domesticated house economists will be quick to explain what what is not good for our banks is not good for Australia.

    Expect the usual litany of hyperventilated scare campaigns that our current arrangement of banking, money supply management and debt creation is the highest form of human civilisation and any change will be a return to the cave.

    How civilised does it feel to you?

    There is no reason to lie back and let a mountain of debt smother an economy for a generation.

    Debt is nothing more than accounting entries.

    • A peerless comment Pfh007. Respect. Just one little correction:

      “There is no reason to lie back and let a mountain of debt smother an economy for a generation a generation for an economy.”

    • pfh

      Good stuff! That’s more sense in a short essay than I’ve seen from Glen Stevens Parkinson et al in all their history. The Doug Nowland piece I’ve posted below is worth a read.

      Unfortunately the safety net you mention can only work if we keep on selling our assets unless the safety net provides just food and only food that we produce ourselves.

      This whole public works proposal is phoney without first reorienting the economy. In the process of instituting these works we we will stimulate imports that have to be paid for somehow. The only method we have is to sell assets to foreigners at an ever-increasing pace.

      I guess the process is alleviated by, as per your proposal, raising all Govt funds that are necessary from local sources. Of course it also sets in train the other parts of your proposals above.

      If I seem to be arguing with your ideas above…I’m not!

      • “…..unless the safety net provides just food and only food that we produce ourselves…”

        Correct.

        The concern about the external sector is justified but in the event that the necessary asset deflation were allowed to take place the exchange rate is likely to sag as foreign debt peddlers retreat and decline to purchase our IOU’s.

        Keep in mind that wholesale lending for mortgages will have ceased and the Fed Govt will be selling only a limited amount of govt bonds to foreign investors.

        Basically the exchange rate will reflect our capacity to sell goods and services rather than financial claims and assets and that will limit what level it trades at and therefore what we can import.

        We will still import but nothing like what we do now simply because the cost of imports will be a lot higher – it may start to be viable to produce a wider range of goods domestically.

        Fortunately, we have plenty of stuff we can sell so we are much better off than those western countries that have nothing much to sell other than IOU’s.

        Getting used to import prices that are not subsidised by selling the furniture and claims on future income is one of the adjustments.

  4. Doug Nowland

    http://www.prudentbear.com/2013/09/sept-20.html#.Uj2Ogn8to9c

    Concluding remark
    “My chronicling of the Greatest Bubble in History is going on five years now. This thesis is based upon the global nature of current Credit and speculative excess, along with attendant financial imbalances and economic maladjustment. My thesis is premised upon Bubble excess having, after decades, made it to the heart of government finance and contemporary “money.” This implies acute – and intransigent – fragilities, which ensure policymakers won’t have the grit to pull back. As was made even clearer Wednesday, the Fed is foremost determined to push back. And that’s precisely the mindset that has allowed the “granddaddy of all Bubbles” to get completely out of hand.

    I believe the Bernanke Federal Reserve made yet another major blunder this week, and the likely price will be only greater market instability.”

    Unfortunately decades of artificially low interest rates and accompanying “speculative excess, along with attendant financial imbalances and economic maladjustment” has more than made it to the heart of Government finance and ‘contemporary’ money. It has infiltrated into the very core of our societies, our education systems and into ‘us’.

  5. Fron Jake Honeycutt at Seeking Alpha

    Too many economists and policymakers seem to employ this line of reasoning:

    If the economy is down … WE NEED A STIMULUS!

    If the economy is up … it’s not up enough; WE NEED A STIMULUS!

    If the stimulus fails … it’s because we needed MORE STIMULUS!

    If the economy is improving … we’ll fall back into a recession without MORE STIMULUS!

    If inflation is high … unemployment matters more; we need MORE STIMULUS!

    There is, in fact, no way out of this. There is no fairy tale ending no matter how many stupid fantasy monetary theories we dream up.

    • The problem is the theory and system in place. For decades if not centuries we have relied on inflation to inflate debt away. Moreover this has resulted in “growth” which has become the only yard stick.

      This worked because there was a natural increase in demand for everything due to the increasing populations and people could take on debt. Moreover due to the inflation the debt would be inflated away.

      Now debt is high and population growth rates are decreasing even reversing. The only way to have inflation is to reduce the rates.

      Edit: This creates inflation (in certain things) but does not necessarily increase demand hence it has not quite worked for the Fed. Ultimately we end up with bubbles and if taken to it’s conclusion, hyperinflation which will also destroy savers and those on fixed incomes and therefore screwing both young and old.

      Interesting times ahead …

      • ff…yep re population growth but more important demographics. Inflation doesn’t eradicate debt it merely redistributes it. It either steals from savers or from future beneficiaries. Inflation will cause a major default on all the promises we have made to everyone for social security. In future we will be defaulting on one hell of a lot of people!

      • Agree flawse, demographics is more important at the moment but population decline might be a problem for a longer time.

        It’s making my head spin, trying to make sense of things. Good to have MB though.

        We will be defaulting on a lot of things, however while this is obvious, our politicians can’t seem to get their act together…

    • Yes – I think his concerns are warranted.

      Perhaps the biggest reason for concern, that Benanke is being replaced by a fellow true believer, is that this suggests that Benanke is not being replaced from a desire for a change in direction.

      So if they are not changing direction why change Chairmen?

      Probably because Benanke WANTS to go.

      And why might he want to go.

      Because his policies are not working and he knows it.

      Remember that can kicking was not Benanke’s objective – he believed he understood the great depression and its causes and has been trying to apply a remedy.

      The problem is that he was wrong – the US and world economy are not reaching escape velocity. They are stuck on the tarmac surrounded by a large and larger pile of barrels of rocket fuel.

      The idea that the choice is between Benanke QE style and austerity style policies is a false dichotomy.

      BOTH approaches are wrong.

      The solution does involve a lot of work by government (which the austerity crew dislike) but trying to protect and maintain a debt engorged private banking system is not part of it ( which the keynesian crowd like).

      Yellen is the patsy for a huge hospital pass – blokes are pretty good at getting all equal opportunity when there is a mess to be cleaned up.

      Perhaps,hopefully, somewhere deep in the basement of the Fed or US Treasury there are people who know this and they are working on plans to try something very very different.

      After all every day that goes by it gets harder and harder for the Kool Aid to convince people they are on the right track.

      Of course our RBA seems to have a few large crates of the concentrate and are mixing themselves some pretty strong shooters.

      • pfh

        I see what you are espousing and yes these things are the only way out. Unfortunately, because we are so distorted economically socially and personally, I fear that the chances of both implementation and success are infinitesmally small.
        However we should work towards the path you outline. There is no other choice.

      • Plenty of reason for gloom but I remain hopeful that there are a growing number of people who are thinking – if QE and austerity don’t work what might?

        All they need to do is put down their ideological blinkers are start thinking outside of their tribal team mantras.

        And most importantly block out the ceaseless self interested bullocks emanating from the FIRE sector.

        FIRE has a role but it requires massive radiation therapy to restore it to a healthy size and function.

      • “The idea that the choice is between Benanke QE style and austerity style policies is a false dichotomy.

        BOTH approaches are wrong.”

        *sigh of relief*

        Thank goodness, someone (else) who recognises this!!!

        You’re on fire this weekend Pfh. Your above comments have helped renew my flagging hopes for the human race 😉

      • Flawse, Pfh,

        Agree your observations above. I sense the real challenge is less one of enough people putting down the blinkers, ignoring the relentless propaganda and beginning to think (outside the box) for themselves, and more one of exactly how to actually bring about implementation of the “radical” policies … and indeed, multiple interlinked stages of such policies … that would be needed to finally bring about the necessary fair and just outcomes.

        The problem is, I believe, less one of an absence of necessary knowledge, and far more one of very deeply embedded power structures that have every reason to resist the changes, with all the enormous power and (often unconscionable) multifarious weapons at their disposal.

      • “Tis the sorest of all human ills, to abound in knowledge and yet have no power over action” – Herodotus

        From a comment in zero hedge but probably more applicable here.

      • I prefer a more positive approach.

        The power structures of the few, not matter how deeply embedded, are NO match for the many when the methods of the few are exposed to the sun.

        It is worth keeping in mind that only a few years ago, the RBA its role and its policies were almost completely beyond question.

        Wholesome technocratic high priests communicating in dephic communiques to the assembled masses of tea readers and RBA-ologists.

        Contrast that with the widespread scorn that greeted the RBAs risible attempt this week to characterise reasonable concerns as ‘alarmist’. The shrillness of the defenders of the RBAs position is a clue that the curtain is drawing open to a wider audience.

        86% clearance rates on high volumes in Sydney with property selling well over reserves puts the RBA’s feeble attempts to deny what is going on in proper context.

        The RBA have drunk the debt machine Kool-Aid and remain entranced by its froth and bubbles.

  6. Aho!

    When Bernanke took teh job I thought he was either the ‘Greatest American Hero’ for taking on the job heading into the obviously coming GFC or he was just a complete utter academic idiot.

    Obviously he was the latter, an academic idiot, but in that he is not alone!

    • Darth Bernanke is no idiot, flawse.

      What we are witnessing is his elaborate plot to turn the western world to technocrat-led-dictatorship. His grand design is to rule the world by appointing his apprentices to the heads of states of major economies without elections (I mean nobody cares about Zimbabwe, right?).

      The recent examples of Darth Monti and Darth Papademos *should* serve as warnings, but I am afraid that the Dark side clouds the vision of most…..

    • PS

      What do you make of Lindsay Tanner’s back flip on his position on FHOG? Prior to the GFC, he spoke publicly that a FHOG or the like would only inflate house prices and would do little to “help” first home buyers. Then, in office, he was crapping the lines of “extraordinary times require extraordinary solutions”.

      Do you believe that Lindsay Tanner suddenly became an idiot after the commencement of the GFC? Or, could it be that he received a memo from Darth Bernanke? Was not he appointed to a consultant of an investment bank after his retirement from the parliament?

      People in the west might be so stupid that they do not even realize (even after the fact) that they are being ruled by dictatorship.

      • “special adviser to financial firm Lazard Australia” according to Wikip.

        Wasn’t he the high and mighty moralist at the end (sadly morality seems more and more the refuge of the failed) – but it never stops these grubby party politicians from jumping into bed with whichever financial corporation thinks they can use them to peddle influence.

        Sickening, but not surprising.

      • Yeah. My guess is that after a few more cycles like we had (and after a few more technocrat-led-temporary-administrations after each of the crises), the predominant argument will become along the lines of; why do we keep appointing technocrat on a temporary basis only? After all, they did a better job than the elected ones and we will need them after each future crisis anyway. Should not we appoint them on a continuing basis to save some public funds on elections?

      • Of course even in financial advisory sell out land there is a pecking order:

        per wikip. Peter Costello: Costello is a managing partner of BKK Partners, a boutique corporate advisory run by former Goldman Sachs JBWere managers. He also chairs the advisory board of specialist corporate advisory firm ECG Advisory Solutions.

        The most cursory of glances will reveal why there is very little expectation of change from the debt and usury world we find ourselves enmeshed in.

    • A great read – Burnside’s decision to engage is admirable (and once again Tim Costello shows himself as an extraordinary human).

      But for mine it still comes from the perspective of a rich white guy trying to understand why ‘Pauline Hanson’ type anger exists, and the answer is more simple than just hate or lack of engagement. The asylum seeker debate is a proxy (a very sad one) but it could equally be something else (and has been in the past eg aboriginal benefits etc).

      We have set up our society to reward lavishly those that are engaged in the FIRE mezzanine, while those busy doing the work of acting with integrity and keeping the place working and clean are treated like nobody and kept in a new form of debt servitude.

      The great tragedy of Howard and Peter C. was instead of doing something about the inequality of the FIRE sector and the harm it was doing, they just fed the beast and channelled the angst to a suitable host. The great folly of people like burnside is they are focused on the misdireted anger rather than putting their efforts to the reason the anger is misdirected.

      • AJ – 100%

        Try building a shed too close to one of those rich white guy’s back fence and they beat the so called outer suburb ‘bogan’ when it comes to unleashed hate, venom and nastiness.

        They are superb at waxing on and dispensing morality about issues they do not have to live with or can ‘manage’ with their substantial financial resources.

      • But….but….the Burnside household must be full of Boat People. Years ago he and his wife were lecturing the rest of us on the ABC about how cruel and terrible we all were. They were taking ‘refugees’ into their house to live. She was fluffing up pillows and getting the place ready showing what wonderful human beings they were compared to the rest of us.

      • Yep, truly sickening listening to the privileged explain to us what good hearted people they really are, must do wonders to ameliorate sucking up several thousand a day in fees from those unfortunate enough to need a barrister.

        They stand shoulder to shoulder with Banksters as the only two parasitic professions that I would ever regard as being better off nationalised.

      • @ Gripper. Knowing a fair few lawyers and barristers, this is not generally the case. Ofcourse there are people like that but most a providing a service and are taking their clients instructions. The problem is human nature.

        I know someone practising family law and the stories he tells is amazing at times. People knowingly spend a fortune just to piss the other party off; against all advise from their lawyers and barristers.

      • ff I’ve had a LOT to do with lawyers over a period of 40 years in business. In that whole time I have met two that I would describe as personally honest. I have met none who were not part of the general corruption that constitutes our system of law.
        If you get a science degree in this country and you are a particularly bright spark you can expect your income, eventually, after many long years, to be about half that of the average, not so bright, reasonably incompetent suburban lawyer of average intelligence.
        How did this situation come about? Why is it so? It’s come about by the same process as all the undeserving others that get noted here day after day. The beautiful game that lawyers have going is that they make up all the rules, and they are the judges as to the application of those rules and they are the punishers for anyone who crosses the line of their interpretation of the rules. At the same time there are no bounds on the degree to which they abuse their clients, steal from them, or act unethically towards them. Please don’t recommend the Courts or the Law Society as methods of appeal. I’ve dealt with both in that regard and they are both just a disgrace. It’s all just one big club and they all drink down at the local wine bar together.

        We have a serious problem that seems to escape those in power. Even relatively wealthy people in this country cannot afford to access a lawyer. Few small businesses can afford to engage a lawyer in their defence. The distortions that this has caused in our society are immense. Yet Burnside et al are happy to go along with, and be the major beneficiaries of, the destruction of the civil rights of a society in order to enrich themselves.

        You cannot be a lawyer in this country and be an ethical person. You would go mad.

    • dumb_non_economist

      aj & pfh,

      I don’t agree, I’ve seen plenty of this from people who are doing well, nice homes, private schools and overseas holidays etc. I don’t believe it’s a money issue, it goes much deeper than that.

      And look just above to see dam and Gripper’s responses! MB, not so common after all!

      • Well perhaps, but you are missing the point. The article was about taking back the Hanson votes. My point is that anger is directed at this easy target by cynical politicians, we may do better to look at why people were voting for Hanson instead of rushing to curse them with the tag of racist and then trying to heal them of this affliction.

      • dne,

        My point was simply that there is a lot of ‘care and concern’ from people who do not actually have to deal with the consequences of their care and concern and a quickness to attribute racist and ignorant motives to any who disagree.

        For me the issue is quite simple – how many refugees can we permanently resettle and provide the services that they require to adjust and integrate – english language skills, skills and training, trauma counselling etc.

        At the moment we take about 14,000 per year.

        I suspect that it will be quite a stretch to double that number – say to 30,000 in the short to medium term. Having relatives and friends working in community services I know that they are already flat to the boards dealing with their current work loads of dysfunctional lives and damage. Who will be providing the services the people require?

        Mr Burnside between cases?

        We could take 30,000 and still be exactly where we are now.

        What gets my goat is not that people express concern about refugees but that they refuse to engage with the logistics of what is involved and the stress on those whose job it is to deal with the issue.

        Many an average Joe gets this point because they know from personal experience just how stretched many public services are already.

        They just don’t express their frustration in the terms set out above.

      • Pfh007

        Well said, the ‘gauche caviar’ set really are sickening with their disingenuous moralising.

        & I agree with you on the refugee issue. Even the political left, via spokesman Bob Carr, admitted at the end that a large proportion of these people are economic refugees.

        & while I sympathise with their predicament I just don’t think its practical to have an open door policy.

        There must be hundreds of millions if not billions of people around the world, living in really bad situations, dealing with violence, poverty, hunger etc etc.

        Is the answer to bring all of them here? I think not, all we are doing is treating the symptoms anyhow.

        Promoting change through the multifarious NGO’s working in this area seems a much better and lasting solution. Even though it is a slow and thankless endeavour.

        People also conveniently forget that the majority of the liberal first world countries, that champion human rights, freedom and the individual. ( the ones the oppressed refugees & minorities are so eager to get to ) Have been founded on the protestant values and work ethic. I find it really galling that these chardonnay socialists, and others on the far left love to demonise the older Anglo-Saxon protestant male as some breed of bigoted fascists who should be banished in shame. Especially considering the freedoms and benefits we all enjoy as citizens of this fine nation were established by old Anglo-Saxon protestant males.

        Obviously they are not infallible and diversity should be embraced, but we should not forget the great gift bestowed upon us by the founders of our nation.

        If you disagree there are plenty of people in camps around the world eager to swap places with any of us.

      • dumb_non_economist

        pfh,

        In general I don’t believe logistics is the issue (not directed at you in anyway), it was handled in the 70s/80s by the Gov of the day and opposition and the international community. What did Howard do at all in trying to get any regional framework in place? Nearly every argument I’ve had over this issue logistics have NEVER been mentioned, it’s ALWAYS ethnic origin/religion, queue jumping, potential terrorist (early days) etc. Now, after “saving” people from drowning excuse from Scott Morrison that’s what gets thrown up without much conviction I might add. I’m not saying everyone, but in general.

        On the last “Insiders” before the election at the end each panel member gets to make a call on whatever takes their fancy. That toad Pearson then talks about the Christian Copts in Egypt and what they are experiencing with what’s happening there and notes that Sydney has a sizable community and we should consider what we can do in accepting them into Australia. Now, I wonder what the difference is between them and most of the boat people, why his concern for them and not a zap for the others.

        From a gov perspective I just cannot for the life of me see a logistical argument, we are spending 100s of millions each year to make sure we keep them out of this country regardless of costs for pure political purposes, what attempts have been made to MAKE this an issue at the UN? Our main argument is it’s the problem of the countries between us and the source that should be looking after the problem, not us.

        I don’t know what you expect Burnside to do, he’s a lawyer and is using his skill and ability to help these people as best as he can, to give them a voice.

        I heard very little nashing of teeth when boats sunk. I bet we wouldn’t be having these discussions if they were white and christian.

        dam,

        I care naught for you opinion, in fact having you disagree just informs I have little to worry about. Why don’t you take your european muslimphobic attitude back home from where you came?

      • dumb_non_economist

        Shemwatson,

        You mean that when Carr made that statement it had no connection with the Gov change in dealing with them? Shit, I didn’t know that, thanks!

        Carr knows there all economic refugees, fcuk me dead, how could he, it has nothing to do with the American Civil War!

        The FACT that over 90% have been found to genuine seems to have been lost here.

        Is there anything else Carr believes in that you accept so readily?

      • Dne,

        I agree there are plenty of uglies heating the air with dopey arguments but the issue is purely logistics.

        Not so much money but the staff resources and the capacity to integrate people into a meaningful adjusted existence.

        There is a limit to the number of permanent resettlements that can be absorbed without creating a social mess that will take decades to repair.

        Unlike the 1970s there are now few low skilled or manufacturing jobs.

        Parts of Sydney and Melbourne are only slowly recovering from the mass migration of low skilled migrants in 1970s destined for a manufacturing sector that died by the time they arrived.

        in Sydney we have DOCS staff in short supply and burnt out just dealing with the multi-generational mess created by the welfare state outer urban ghetto model of the 1970s.

        Teaching people English and useful skills takes time and people with the necessary skills

        Despite the so called empty bed rooms the rental vacancy rate demonstrates there is no oversupply of housing to house a significantly larger intake.

        We should take as many refugees as we can absorb – even if that involves significant discomfort. But lets be clear the discomfort will be felt by people in outer suburbs who also are low skilled and already struggling to find opportunities in an economy that has been hollowed by the preferences of many in the inner suburbs for free flows of capital, goods and services and a rampant FIRE sector.

        But what is the figure?

        15,000
        20,000
        25,000
        40,000

        And keep in mind that this figure should be deducted from the standard migration number.

        Whatever the figure is the people should come from refugee camps around the world.

        We could fill the number without blinking.

        Anyone arriving on a boat should be removed to a refugee camp and someone from that camp gets a place instead.

        The boats will stop and we will continue to lead the world for permanent resettlement of refugees.

      • Some good points in this discussion. There isn’t a simple solution to this issue because of our socio-politico environment. Our very generous welfare system means that we will always be attractive.

        The fact that our population is concentrated into congested cities means we have logistics problems. Yet we could actually do with manual labor in the country (fruit picking?).

        We are a very expensive country to live in therefore many can’t support themselves for long. Similarly it is a big task in dollar terms to help these people out. There are also cultural and religious issues.

        However some of what I said prior applies equally to Aus citizens as well. How many of us are taking advantage of the system and then pointing fingers later?

        The linked mini doc is about food stamps in US

        http://www.zerohedge.com/news/2013-09-21/food-stamp-nation

        I would love to see a similar doc about welfare here.

      • dumb_non_economist

        pfh,

        How many of these people in those camps you mention are displaced because we went to war in their home country for 10+ yrs? How many are from countries that we have applied sanctions on that have destroyed their economies

        I would guess that a fair number would also be well educated (in the case of Iranians).

        Shit, as to the number, kill immigration!

        I don’t know what the answer is, but I disagree with you that the “numbskulls” are a few, but actual the many, but I guess that doesn’t change the issues.

      • Regardless of weather or not you believe we should accept refugees is irrelevant.

        Unless your espousing anarchy, then its pretty obvious that things need to get be done in am orderly lawful fashion.

        If we do decide to accept more refugees it offer to be done the right way.

      • dne,

        i don’t know how many refugees are in camps because of something that Australia has done or supported etc – but probably more than enough to exceed our target each year without anyone from a boat being accepted.

        What is the basis of a refugee claim by a well educated Iranian?

        Perhaps they are Iranian Kurds or Bahai’s or Zoastrians as they tend to get a raw deal compared to the shite persian majority.

        The number of numbskulls and the weakness of their arguments is irrelevant – I am interested in reasonable arguments.

        Though you may prefer that all migration is replaced by higher refugee intakes the reality is that such a policy would be doomed for the simple reason there are lots of migrants and former refugees who want a family reunion and migration program.

        The key point remains that there is no discussion of what rate of refugee intake is sustainable. Which is fairly predictable as there is no such debate for migration either.

        Lots of emotion and moralising by both sides and not enough analysis.

        But for all that I support a large increase from the current 14,000 – perhaps get to 30,000 per year over the next 5 years for permanent resettlement and reduce regular migration by the amount of the increase.i

        But none who arrive by boat.

      • If we do decide to accept more refugees it offer to be done the right way.
        I seem to have missed the post where anyone even vaguely suggest it be done other than “the right way”. Could you quote it for me ?

      • What gets my goat is not that people express concern about refugees but that they refuse to engage with the logistics of what is involved and the stress on those whose job it is to deal with the issue.
        Your argument seems to be based on the premise that these “logistics” are fixed at current capacity levels.

        I imagine that “they” think perhaps some of the money funneled into parental leave or negative gearing, or, heck funnelled into finding creative ways to make Australia less attractive than death, could instead be used to expand the facilities for dealing with refugees. However, “they” might believe in crawling before walking, and thus feel that the debate first needs to be redirected from its current “OMG the brown muslim middle-class economic refugees are invading us” tone before anything approaching a rational discussion can be hand.

        What is the basis of a refugee claim by a well educated Iranian?
        Maybe it would be similar to the basis of a refugee claim by a well educated Jew during WW2 ?

        But none who arrive by boat.
        Why ? What makes their claims to persecution automatically invalid ? Why are they any different to someone who walks off a plane and claims asylum ?

      • dumb_non_economist

        pfh,

        To be fair I think you should state your reasoning against those who arrive by boat. It’s obviously not a number or logistical issue.

        The educated Iranian was in response to your comment on the lack of low skilled jobs.

      • dne,

        None by boat?

        I have no doubt that the majority who arrive by boat are legit refugees.

        But I say accept none because people die in their hundreds making the attempt and accepting a claim made by someone who arrives by boat has and will continue to encourage others to try.

        Better they stay in camps in Malaysia – funded by Australia – and wait until their name is called.

        If there are 50,000 in camps in Malaysia and Australia draws 5,000 of my proposed higher 30,000 intake per yearfrom Malaysian camps the wait will be 10 years.

        Keep in mind that we currently take approx 14,000 – every boat arrival reduces the number of places offered to refugees in camps around the world.

        DrSmithy,

        You say there is plenty of money if other waste is cut.

        That is certainly the case but money is not the problem – its the integration and adjustment of large numbers of unskilled, traumatised, culturally unfamiliar people into a modern and arguably unbalanced and dysfunctional economy.

        Those social mistakes of the 1970s are still going strong in most of our capital cities even though people having been trying to solve them ever since. The 70s mistakes were in turn an attempt to solve earlier mistakes.

        If I had a magic adjustment and integration wand I would be the first to wave it as a diverse population constantly being injected with new migrants is a major strength but over do it and the results will be counter productive.

        As I keep saying the stress of the adjustment and any mistakes is not felt by the highly skilled and educated middle classes.

        Unless you are actually proposing we run large temporary protection camps like the ones that most refugees live in where they are just sit and wait for years and years until they go home or someone offers to take them.

        But we tried that and no one liked kids and people living in camps.

      • “However, “they” might believe in crawling before walking, and thus feel that the debate first needs to be redirected from its current “OMG the brown muslim middle-class economic refugees are invading us” tone before anything approaching a rational discussion can be hand.”

        Hmmm, I would encourage them to give the rational arguments as to how larger intake can be successfully supported and integrated a whirl as this debate has gone on for years and rarely do the supporters of a larger intake even try to address the issue.

        They may find doing so will put some of the concerns of some people to rest.

        Especially the thousands and thousands of people already here with low skills and other barriers to employment ( language, literacy etc) who cannot get work or support services to improve their skills.

      • @Dr smithy

        “I seem to have missed the post where anyone even vaguely suggest it be done other than “the right way”. Could you quote it for me ?”

        Here is a quote from one of your own posts.

        “But none who arrive by boat.
        Why ? What makes their claims to persecution automatically invalid ? Why are they any different to someone who walks off a plane and claims asylum ?”

        If that comment isn’t in favour of arriving by boat. ( Which is unarguably a chaotic, disorderly, illegal and wrong way to arrive) then I don’t know what is.

      • You say there is plenty of money if other waste is cut.
        No I didn’t say that. Though, I do expect it to be true.

        I say your assertion that no-one “engages with the logistics” is false. I also say your implication, that the people voting for parties based on their promises about how mean they can be to refugees are motivated by logistics concerns, is questionable (at best).

        It’s like me saying that the people yelling “stop the boats” haven’t contemplated the effects that has on the people currently using them to flee persecution. Most of the time it’s true, but there are a handful of people like yourself who offer alternatives paths for humanitarian intake, like Australian-run refugee camps.

        That is certainly the case but money is not the problem – its the integration and adjustment of large numbers of unskilled, traumatised, culturally unfamiliar people into a modern and arguably unbalanced and dysfunctional economy.
        A large part of that integration is simply a matter of money.

        Something like 10% of the immigrants we receive come from China. A place at least as “culturally unfamiliar” as anywhere refugees are likely to be fleeing. While the Asian Invasion certainly looms large in the mind of some, it does not appear to attract quite as much fear as the boat arrivals across the board.

        We keep hearing on the news how all these boat people aren’t really unskilled peasants, but skilled, middle-income economic refugees. That seems reasonable, given the resources to get from their home country to a position to get on a boat would be relatively non-trivial. It also, however, suggests that these people will not be quite the wave of unemployable sponges they get presented by.

        Or, in more concise terms, some people need to get their story straight and decide if boat people are middle-class economic migrants jumping the queue, or ignorant peasant foreigners who will end up sucking down welfare for the rest of their lives.

        As I keep saying the stress of the adjustment and any mistakes is not felt by the highly skilled and educated middle classes.
        That stress, however, is driven by far larger and more significant factors than a few fractions of a percent worth of refugees.

        Hmmm, I would encourage them to give the rational arguments as to how larger intake can be successfully supported and integrated a whirl as this debate has gone on for years and rarely do the supporters of a larger intake even try to address the issue.
        I’m pretty sure their arguments are to increase the resources for dealing with refugees.

        Some say we should sacrifice “skilled” immigration headcount for refugees. An argument I find quite a bit of sympathy with.

        They may find doing so will put some of the concerns of some people to rest.
        I doubt that the “some people” who are concerned about the logistics make up a large proportion of the complainers.

        Especially the thousands and thousands of people already here with low skills and other barriers to employment ( language, literacy etc) who cannot get work or support services to improve their skills.
        Any of those who voted Coalition clearly don’t have any serious interest in having their “low skills and other barriers to employment” problems addressed, because they voted for the party that demonstrated little interest in doing so, and is in many ways ideologically opposed to it. It follows, therefore, that their complaint against refugees is not motivated by that concern.

        Let’s not forget the major parties are all fairly pro-immigration of the kind that induces “stresses”. So people who have voted for them are implicitly in favour of immigration despite the logistical problems you are saying concern them. That leaves other motivations for them to be so worried about boat arrivals, but so unconcerned about plane arrivals.

      • Drsmithy,

        You main point seems to be that the points I am raising are not the points being raised by others who are opposed to boat arrivals being permanently settled.

        You are keen to debate racists and xenophobes, and you appear to believe the country is full of them, rather than engage with the issues I have raised beyond – ‘more resources and there is no issue’.

        i will let you get on with the job.

    • It is time to peel away the slick marketing facade and smash the banks apart.

      Perhaps we need to not just limit market power but limit geographic markets as well. Max 5% market share, max 5% geographic market.

      Do we really need to wait until our idiot party politicians and their corporate owners blow the place up with debt again?

      • “Do we really need to wait until our idiot party politicians and their corporate owners blow the place up with debt again?”

        I am afraid we do. Maybe I am lacking imagination, but I just cannot see a way out. Can you? I have been trying to reposition my portfolio so that it will suit the post-bust world…..