Weekend Links 31st Jan – 1st Feb 2015


Global Macro/Markets/Commodities



Americas/United States



Latest posts by __ADAM__ (see all)


  1. http://tv-novosti.ru/date/2015-01-30/ntv/16-00 (in Russian)

    Russian media is reporting that the Donetsk rebels (presumably with a lot of Russian help) have encircled 8000 Ukraine army types around Debeltseve.

    If they dont sort that out soon then there is going to be a major catastrophe. They are calling to them to surrender and claim soldiers are now deserting to the rebels (but arent being named or face shown because the government in Kiev is taking reprisals against the families) …..

    There is some local belief that there are ‘Foreign forces’ trapped inside with the Ukrainians, which would make things interesting.

    • No reason Black Ruthenia shouldn’t return to the Motherland. White Ruthenia (Belarus) will do the same when the time is right.

      History hasn’t ended, the Poles need to watch their back when the Eurozone breaks up, they are sitting on a lot of Pomerania and Silesia that should be German.

      • Drove through Geelong the other day. Particularly a suburb called Norlane. It was like some post Apocalyptic suburban ghetto, and made me share some of Gunna’s pessimism for this country.

      • Geelong has turned on the weather for him this morning. He wouldnt get a rousingly popular endorsement at the best of times down here – so I agree with his strategists opting for the moving target approach, and they’ve done well to get him to Geelong when student numbers will be down, and when most of the local Torynuffs will still kicking the stubbies under the bed after the Christmas break.

        And that ride down along the Great Ocean Road – that should familiarise him with the concept headwinds on a day like today…..

        …….Turnitup, believe it or not I suspect that parts of Norlane are trying to gentrify. It is a place where migrants can actually buy a place (some Serbian friends purchased a place for circa 230K, and once on the train it is only 50 minutes to Spencer street for the Melbourne commuting set). The closure of the Ford Plant in about 12 weeks time will be interesting out that part of the world.

      • Yep we drove past the Ford plant and I wondered the same thing out loud. Although I wasn’t aware of the time frame. Scary stuff.

        Must say that I/we were very impressed with the rest of the Bellarine peninsula. We loved Port Arlington, St Leonard’s, Pt. Lonsdale (where we stayed), Queenscliff & Barwon Heads. Those places have a lot going for them, but unfortunately after only one night it was time to catch the ferry back to boring old Sorrento.

        I’ve wondered this before about rural places (and even places like Geelong if you buy a house for 230k)…. Why don’t they market themselves more aggressively, using land prices as leverage (bad pun)? P’raps its a lack of jobs….


    Debt That Once Boosted Its Cities Now Burdens China – WSJ
    … google search title if blocked …


    Even before its latest step, Beijing had put forward plans to slow local-borrowing growth. But China’s local governments have a surprising ability to resist policies. Another central-government priority—reducing excess production in steel, cement and other industries—has foundered due to local opposition.

    “The guys running local government financing operations won’t roll over and die,” says Fraser Howie, co-author of “Red Capitalism,” a study of China’s financial system. “These companies take on a life of their own.”

    Commodity Shipping Measure Falls to 28-Year Low on China Demand – Bloomberg Business


    • Ship gauge at 28-year low raises fears for sector – fastFT: Market-moving news and views, 24 hours a day – FT.com


      The index tracks the price of shipping dry bulk commodities such as coal and iron ore, and is perceived as a useful bellwether for global commodities demand and trade.

      At 632 points at the end of yesterday, the index is 95 per cent below its 2008 peak of 11,793.

      • Mises was a lunatic… makes Milton seem a saint in comparison.

        BTW Mises AET is a planned economy [sociopolitical template], as MPS was funded by corporatist e.g. the foundation to neoliberalism as a knee jerk reaction by paranoid psychopaths.

        “Friedrich Hayek was an unusual character. Although well known to be a libertarian political philosopher, he is also commonly associated with being an economist. And it’s certainly true that at one time Hayek’s focus was solely on economics. In the 1920s Hayek was still within the fold of pure economics, publishing papers and works that were taken seriously by the discipline. However, by the 1930s Hayek’s theories had started to come apart at the seams. Exchanges between Hayek and John Maynard Keynes and Piero Sraffa show Hayek as confused and even somewhat desperate. It was around this time that Hayek discontinued making any substantial contributions to economics. Not coincidentally this overlapped with the time when most economies, mired as in Great Depression, demonstrated that Hayek’s theories were at best impractical, at worst a complete perversion of facts.”


        Praxeology FFS methodological individualism utilized to reduce social interaction to atomistic binary code by which all human events can be rationalized. Good grief… are we all to be influenced by priests – of what ever stripe – till the end of time.

        Skippy… social psychology makes a mockery of this kind of mental wankery….

      • Skippy … something more to raise your blood pressure … an article I wrote back mid – 2013 …

        Suffocating Bureucracy & Failed Institutions | hugh Pavletich | Scoop News


        … where I quote extensively from a brilliant article at the time by Fraser Nelson of The Spectator … reprinted in the UK Telegraph.

        Bureaucracies are gifted at buggering up just about everything they touch.

        It will be most interesting to learn what they have really been up to, as the tide goes out in China.

      • I would also add that the stark reality is that the field of economics, despite its protestations to the opposite, has concerned itself much more with moral and religious instruction than with science. And as with all religious and moral endeavors, there is a tendency towards dogmatism. And so most economists, like all good evangelists of the faith, really don’t do doubt and questing for reality very well. What they do well is certainty and distortions of reality.

        The trick for economists is to cloak their ontological and metaphysical dogmas in the virtuous garments of science. The best of science entails a generous dollop of skepticism and doubt, and the ability to alter one’s theory when theory doesn’t coform to reality. Of course what economists do is just the opposite: they attempt to alter reality to fit theory.

        Some unpacking…

        “The stark reality is that the field of economics, despite its protestations to the opposite, has concerned itself much more with moral and religious instruction than with science. And as with all religious and moral endeavors, there is a tendency towards dogmatism. And so most economists, like all good evangelists of the faith, really don’t do doubt and questing for reality very well. What they do well is certainty and distortions of reality.

        The trick for economists is to cloak their ontological and metaphysical dogmas in the virtuous garments of science. The best of science entails a generous dollop of skepticism and doubt, and the ability to alter one’s theory when theory doesn’t conform to reality. Of course what economists do is just the opposite: they attempt to alter reality to fit theory.”


        Skippy…. its all just so reminiscent of Roman elites setting up temples to garner local political leverage via lower strata citizens and slaves. Thereby augmenting their power in upper tier power scraps with their peers or is just a repeat of the Mayan thingy…

      • Wellie some seem to forget history Hugh and how government became beholden….

        “the overwhelming priority of Volker’s “philanthropy” was focused, not on public spaces but on reactionary ideology. Dismayed by the rise of Socialism in America and doubly dismayed by what he saw as the evolution of government and political thinking towards accommodation and a “new liberalism”, eventually personified by the widespread adoption of the economic views of John Maynard Keynes and the New Deal policies of Franklin Roosevelt, Volker set out to create a new and much more reactionary “mainstream” ideology based loosely around his own ideas of “laissez-faire” capitalism (i.e. a largely unregulated economy) and social Darwinism (the pseudo-scientific notion that in society, unhindered competition would allow the “cream to rise to the top”).

        In truth, Volker was no great scholar or thinker. The ideology he set out to create was built upside down, starting only with a set of foggy conclusions for which he had a predisposition. From these conclusions, it was the task of Volker’s considerable fortune to find a set of justifications, then an enabling ideology or “theory” that gave it all perspective and unity and, eventually, a true philosophical platform from which to launch the whole. But if this task was analogous to building the Great Pyramid, starting from the top, Volker was undaunted. He may not have had a brain but he had money… and he had a personal connection to one of the most reactionary sections of that most reactionary of organizations – the National Association of Manufacturers. Volker’s “associates”, who would all participate closely, included Jasper Crane of DuPont, B. E. Hutchinson of Chrysler, Henry Weaver of General Electric, Pierre Goodrich of B.F. Goodrich, and Richard Earhart of White Star Oil (which through many mergers and aquistions would eventually become Mobil Oil). Moreover, Volker had “influence” at the leading scholarly institution in his home town: The University of Chicago, founded by none other than John D. Rockefeller and created with a certain ideological “bent”.

        In 1932 Volker established the William Volker Fund and, with that, started on the road to becoming perhaps the most significant anonymous asshole of our times. In every way, William S. Volker was the true “father” of Libertarianism and Modern Conservatism.

        For the first dozen years, the fund largely floundered. There is some evidence that Volker may have flirted with Fascism. That ideology though, which attracted such celebrities as Henry Ford and Charles Lindbergh, was thought to have a limited future in America. In the face of Keynesian economics, widespread social spending, and the CIO, what was really required was a return to pre-New Deal economic policy and an anti-communist/anti-union social policy.


        The breakthrough came in 1944, when Volker’s nephew, Harold Luhnow, took over, first the business and then the Fund. In the same year, Friedrich Hayek’s The Road to Serfdom was published. The book was a product of the “Austrian School” of economists, originating at the University of Vienna and first coming to modest prominence at the end of the 19th century in its attacks on Marxist and Socialist economics. Hayek’s book was an almost mystical (and hysterical) defense of laissez-faire capitalism and the “free market”. According to Hayek, market prices created a “spontaneous order, or what is referred to as ‘that which is the result of human action but not of human design’. Thus, Hayek put the price mechanism on the same level as, for example, language.” In turn, any attempt at regulation would inevitably lead to “totalitarianism” and in this, both Marxist and New Deal “socialism” were essentially similar. The theory was perfect . Volker and Luhnow had found their ideology. The cash began to flow.

        In short order, the Volker Fund and its larger network arranged for the re-publication of Hayek’s book by the University of Chicago (a recurring and important connection) despite the fact that it had been almost universally rejected by the Economics establishment. A year later, the book was published in serial form by the ultra-reactionary Readers Digest not withstanding the fact that it was supposed to be a “scholarly text”, ordinarily inappropriate for the readership of the Digest, and despite the fact that it had also had been panned by literary critics. In 1950, the Fund arranged for Hayek to secure a position at the University of Chicago and when the University only granted an unpaid position, they arranged for the Earhart Foundation to pay him a salary. Hayek was only the first of a veritable flood of émigré, “scholars”.

        Recruiting the Homeless

        Hayek’s teacher in Vienna had been one Ludwig von Mises who, in turn, had been the student of Eugen von Boehm-Bawerk (who had gained fame for his attack on Marxist Economics) and who, in his turn, had been the student of Carl Menger, the founder of the Austrian school. Each of these had published several books that were virulent attacks on Socialism and defended “pure capitalism”. It was all very good. Von Mises book was called Socialism: An Economic and Sociological Analysis and it too had been received with yawns when it was published in English in 1936.

        While von Mises really had “taught” at the University of Vienna, his was an unpaid position. The University had turned him down on four separate occasions for a paid position. Not surprisingly, in 1940 the nearly destitute von Mises had emigrated to the United States. In 1945, an unpaid “visting professorship” was obtained for him at NYU while his salary was paid by “businessmen such as Lawrence Fertig”. Fertig was an associate of the Volker Fund and a friend of Henry Hazlitt, the Fund’s friendliest journalist. In all, they would fund von Mises for 25 years and von Mises never would need a “real job”.

        In fact, this was typical of the Fund’s “bait and switch” tactic for developing resumes. In the United States, von Mises was the “famed economics professor from the University of Vienna”. In Europe, he would become the “famous American economist from NYU”.”

        Skippy… to put it bluntly… those that criticize government should reconcile the historical events which shaped it. Best government money can buy sound familiar.

      • @Hugh,

        What you seem to fail at or gloss over is the staffing of government with economists and sociopolitical engineers, that were supplied by the very school[s you advocate. Which in turn were funded by the corporatist et al that your mob[s worship as supreme beings.

        China? They took a page from the Chicago school book and used it to fend off the anglophone lusty looks, in order to cement its geopolitical sphere. At the end of the day that’s all they really care about, not the bloody debt. Its more free market over there than any western economy shezzz…

        Skippy…. at the end of the day its all geopolitics… everything else is just window dressing… Kabuki…

      • “social psychology makes a mockery of this kind of mental wankery…”

        Very true. Economics and politicians could learn a lot from social psychology. But then it would conflict with their mindbogglingly narrow and idealistic view of how we behave and think. It’s easier just to ignore it.

      • @ Hugh Pavletich,

        Thanks for your interesting articles Hugh , They are always informative.
        Would you be able to write a bit on how NZ managed to change it’s electoral system from First Pass the Post, winner take all to the much more inclusive Multi seat electorates?
        What did make the Nationals & Labour agree to the change?

        Serious inquirery, Aus politics needs to do something similar to become relevant again.

      • Its more free market over there than any western economy

        Exactly. Occasionally I’ve seen conservatives (especially from the US) claim that China has been so successful in recent years because the government provides almost no safety net and most people must fend for themselves (thus the low wages). In the next breath they’ll tell you that Communists are Socialists.

    • China: Overborrowed and overbuilt – FT.com#axzz3QLGdYrol#axzz3QLGdYrol … google search title if blocked …


      … extract …

      By the middle of 2013, the last time the government published any data, outstanding local government debt stood at Rmb18tn, up 80 per cent in just two years. That increase happened even after Beijing forbid local officials from raising excessive amounts of money.

      But even as the economy slowed last year and officials were tasked with propping up growth with even more infrastructure investment, local government borrowing appears to have surged again. Partial statistics on local government fundraising shows they sold Rmb1.66tn worth of bonds in 2014, compared with Rmb900bn in each of the two previous years. … read more via hyperlink above …

    • Bolstrood … There would be others with a much better knowledge of the change from First Past The Post (FPP) to Mixed Member Proportinal (MMP) electoral system that occurred here in New Zealand in the mid 1990’s.

      There are still those here in NZ that bemoan it. Those in the main who favour the strong leader approach. I strongly disagree with them.

      Its greatest benefit as I see it, is that it tends to encourage all constituencies out there to talk to each other and thrash out issues. It also tends to encourage the pragmatic and suppress the ideological approach to politics. That had been a real problem in the past.

      So other than checking out this issue with a google search, I trust some MB reader with a sufficient knowledge of this electoral change history can respond here on MB.

      • bolstroodMEMBER

        @ Hugh Pavletich

        Thanks for repyling Hugh, you’re appreciation of the Mixed Member Proportional system supports others I have spoken to.It sounds like an impossible dream from here in Aus.
        Still the electorate is showing it’s anger & frustration, Last night Qld voted out a 1 term LNP govt. that had 70 seat majority.The fed govt. is reelling in the polls. Victoria recenlty voted out a first term Govt.
        People are sick of being lied to & not being represented by their elected representatives. Voting against the incumbant is a way voters can vent their frustration. We really need a better form of government.

  3. The biggest vulnerabilities for both New Zealand and Australia, is that the events in China “trigger” housing bubble collapses here. I touched on this issue mid last year with NEW ZEALANDS BUBBLE ECONOMY IS VULNERABLE …


    In assessing housing bubble intensity, the simple Median Multiple measure is best (refer Demographia Housing Surveys at http://www.demographia.com and http://www.PerformanceUrbanPlanning.org ) … something I covered early 2009, incorporating a quote from Michal Lewis within HOUSING BUBBLES & MARKET SENSE …


    The Irish housing bubble is of particular interest, when across its major metros, the Median Multiples overall collapsed from 4.7 to 2.8. Australia and New Zealand’s Median Multiples are considerably higher than Ireland’s art its peak in 2007.

    • As China’s Offshore Yuan Crashes To A 2 Year Low, Beijing Warns Its Citizens: “Don’t Buy Dollars” | Zero Hedge


      We won’t go into the specific details of China’s burst housing bubble, the shady underworld of its pyramid scheme wealth-management products, the fact that any hard asset in China is rehypothecated literally a countless number of times, the nuances of its deflating shadow banking system, or even the complexities of its alleged capital controls (alleged, because as a reminder, they only exist for the common folks – the really wealthy Chinese are naturally exempt from any capital flow constraints). We will point out something even more disturbing. … read more via hyperlink above …

  4. Cheap Oil Burns $390 Billion Hole in Investors’ Pockets – Yahoo Finance


    … and the assets related to other commodities ? …

    No Quick Fix For Commodities As Falling Currency And Fuel Costs Encourage Over Production … Forbes


    Commodity prices collapse to lowest in 12 years – Telegraph

      • Peter Fraser … thank you for your comment.

        There were plenty of POSITIVITY FAIRIES in Ireland in 2006 / 07 too … and I would suggest you check out some of the excellent YouTube documentaries “Irish housing bubble,”

        Another useful learning experience is to compare housing bubble vulnerable Australia, with Texas which doesn’t have a housing bubble … and both economies capacity to handle a “commodities shock”.

        With what is going on in China, Australia should be very concerned indeed in my view. While New Zealand certainly has problems, its housing bubble is not so intense and it does not have anything like the structural problems Australia has.

        Thankfully the New Zealand politicians at both central and local level are on to the housing bubble issue … with the essential foundation of strong public support.

      • Not meaning to be rude Hugh, but if you understood the structural differences between Australia and Ireland you wouldn’t bother with that comparison. A better comparison would be the USA, Canada, New Zealand, or Britain but none of the EUzone countries.

  5. The likelihood that Europe will throw Greece out has increased. So Greece can finally recover some sovereignty. Some ‘self determination’. Some Independence.

    The likelihood that Spain turns left with Podemos this year has also increased.

    Thus the likelihood the EU itself will disintegrate over the next few years is a very high.

    70% chance for me.

    The markets aren’t panicking. Drugged by global QE.

    When this shit finally hits the fan, markets will self combust.

    • migtronixMEMBER

      Little did we know that just minutes after our tweet, we would learn that at least one place is already paying homeowners to take out a mortgage. That’s right – the negative rate mortgage is now a reality.

      Thanks of Mario Draghi’s generosity with “other generations’ slavery”, and following 3 consecutive rate cuts by the Danish Central Bank, a local bank – Nordea Credit – is now offering a mortgage with a negative interest rate! This means, according to DR.dk, that Nordea have had to pay instead of charging interest to to a handful of customers, says housing economist at Nordea Kredit, Lise Nytoft Bergmann for Finance

      Oh that why! DKK trade might come good after all — Australia I see your future, and it is NIRP morgages


    • Swiss gov debt negative yield out to 15 yrs, think of it as information vanishing over the event horizon as we approach the singularity.

      Swiss central bank will not be able to service its liabilities.

      Law of unintended consequences No. 1 Nordea Credit in Denmark with latest negative interest rates in that country have to pay some people who have mortgages with them. Strangely their computer programmers never were told to envisage that possibility.

      Perhaps our masters intend to load everything onto the sovereign credit card and cancel all the sovereign debt all at once. Who could resist the opportunity ?

    • Pay people to buy ever more expensive houses, just to keep prices from collapsing?

      Sure. Why not.

      Nothing can go wrong.

      • migtronixMEMBER

        I think the bankers have lost the War on Deflation, and need at least one asset class to keep creating new “money” or its curtains!

        I fear they are scratching around the base of skippy’s Well of Infinite Contracts (TM MMT)

      • Supply economics was founded by the free market posse imo.

        Arthur Laffer. Supply-side economics is likened by critics to “trickle-down economics. lmmao the Arthur Laffer curve…. look at the model…. look into my eye…. its science!!!

        “Supply-side economics developed during the 1970s in response to Keynesian economic policy, and in particular the failure of demand management to stabilize Western economies during the stagflation of the 1970s.[6] It drew on a range of non-Keynesian economic thought, particularly the Chicago School and Neo-Classical School.[citation needed] Bruce Bartlett, an advocate of supply-side economics, traced the school of thought’s intellectual descent from the philosophers Ibn Khaldun and David Hume, satirist Jonathan Swift, political economist Adam Smith, and even United States ‘Founding Father’ Alexander Hamilton.[7]”

        Skippy… all because of ideological rigidity as informed by metaphysical opinions out of antiquity negating the use of tools which would have fixed the bloody problem, but NO, religious belief trumps everything else.

      • It would be interesting to do some analysis on what zero and negative interest rates mean for the economy. I would assume that neg interest rates could lead to out right hyperinflation. This is one for Steve Keen and his Minsky program.

  6. One of the biggest problems we face is a refusal by governments to acknowledge publicly that we’ve been in a global depression since 2008.
    People are willing to put up with a lot of hardships in life to bring their country’s financial situation back to ‘normal’, but with politicians and central bankers at the end of their tether privately and yet telling the public that everything is fine, we are just not being effective against what history will eventually show as the Greatest Balance Sheet Depression ever.

    Even the people running this site will not acknowledge the seriousness of the situation.

    • They seem to have given up. I could never understand their actions in 2008, we all know what needed to be done then when the bank stocks were at their lowest.

      40 billion in govt equity stuffed into each of the big4 and smaller amounts into the others. Half their earnings to be retained for the next ten years to build liquidity.

      They seem to have decided that it was already too late to fix the banks in 2008. It is a lot worse now.

    • The other thing that seems unacknowledged (or unrecognised) is the present state of global disintegration. The background narrative of armaggedon-esque collapse is presented as something that is still to come – a future scenario.

      In fact, it is here, now. If you understand the chaos in the middle east, the state of the EU atm and the tectonic changes underway (particularly with Syriza and soon Podemos), the completely debauched condition of global markets, the overinflated price of certain asset (classes) and the collapse of others, the hot wars underway (or about to begin) between russia/china and the ‘west’, the gargantuan pool of idle, unemployed and completely hopeless males looking (rightly) for change, the madness of austerity that has forever changed (in millions) their positive perception of western liberal democracies (properly functioning welfare states are now scarce).

      The disintegration is occurring around us as we await for it to happen at some point in the future.

      The historical record will report this period as ‘well into the beginning’ of Late Capitalism’s death throes.

      But also the ultimate beginning – the ‘birth pangs’ of the ‘new’.

      • Yeah Ortega, History will look back and laugh at us:
        “What the f*^*^ were they thinking…why did they let it get worse after the shock of 2000?….2008?… January 2015?…”.

      • It’s good to know that there are alternatives out there. I like Pepe Escobar and Paul Craig Roberts. For example. Good antidote for all the bullshit in the ” free press” around us

    • interested party


      To be fair, the boys running this joint are competing with the MSM and are holding their own. I strongly believe that in private conversations with them your view of them would change. If they ventured down the path of calling the truth out, this site would join the ranks of many tin-foil hat wearing sites. If you read between the lines, you can see that they know what is going on but political correctness does not allow them the luxury of open comment that we as readers and commenters do. It is a fine line they are walking on….and do a good job at that.

      The northern hemisphere has been in technical depression as you describe….we missed that call ( thanks, China stimulus ) only to squander the opportunity to get our house in order before the next leg down commences……It really has devolved into some Alice in Wonderland stuff now.
      What I personally find fascinating, almost mesmerizing in fact, is the absolute stupidity that these people in power are displaying.

      It is an incredible time to be alive……this era will be etched in history as the age of delusion.

      • Assuming there is any more history.

        Stripped of its ephemera, the history of the human race – at least until the Modern Era – has been a story of psychopaths competing with one another to gain positions of power, then using that power to dominate and brutalise their fellow human beings.

        If that behaviour changed in the Modern Era it was not because human psychology had evolved. It was just that there happened to be an advantage in training large numbers of commoners to moderately high levels of skill to operate the complex – but not fully automated – machinery of the industrial state.

        Having had so much invested in them, the commoners in turn had a negotiating advantage and could demand a better deal for themselves and their children.

        But it has now become apparent that the Modern Era – far from being the wonderful, permanent new world that we of the 20th century imagined it would be – was in fact just a brief historical anomaly.

        With the rise of AI and robotics, the advantage has moved to training tiny numbers of people to very high levels of skill.

        Within a generation most of the human race will be redundant. The Elite no longer need them.

        And we know from the record of history that psychopathic Elites have no hesitation in wasting the lives of thousands – millions, hundreds of millions – of people if it suits their purpose.

        As long as the redundant commoners are allowed to go on living they will pose a threat to the Elite.

        As long as they are allowed to go on living there will a danger of them rising up and overthrowing their Rulers.

        You don’t need to be Einstein to see how this game must eventually play itself out.

      • To highlight your point Stephen…

        “Housing a prisoner costs roughly five times as much as educating a student in California, Washington and Utah. In dozens of other states, the cost of imprisoning someone is far more than double or triple the cost of educating a student.

        Mass incarceration is costly — and it doesn’t work: Comparing the housing of prisoners to the education of students might seem like comparing apples and oranges. After all, a student is spending about a third of a day at school, while a prisoner is being kept alive 24/7.

        In light of that fact, there are two points worth noting:

        First, the U.S. should simply not be spending any money on incarcerating many of the millions in prison all over the country. Since the 1970s, the U.S. has built a system of mass incarceration that is unrivaled the world over: About 25% of the world’s prisoners are incarcerated in America, even though it hosts only 5% of the world’s population. Brutal sentencing practices — lengthy minimum sentences, harsh penalties for minor drug possession, three strikes laws — have filled up our prisons at rates that outpace Russia and China. In other words, every state is spending huge sums of money on people who should either not be incarcerated in the first place or should at least be serving far shorter sentences.

        Second, the U.S. incarceration system is basically an inversion of its education system. As flawed as the public school system is in this country, children routinely emerge with knowledge and skills that allow them to contribute more effectively to society. By contrast, the voracious prison system systematically fails to rehabilitate its inmates. Nearly two-thirds of the inmates released every year return to prison. Those that manage to remain outside of it are often far worse off than before they were incarcerated, as they endure discrimination in housing, employment and political participation. ”


        Skippy…. ” Nearly two-thirds of the inmates released every year return to prison” – talk about your self licking ice cream cones…

      • interested party


        That is a very dark path you are walking….I am not denying it’s existence…….

        You say within a generation most will be redundant…….that should be very obvious to those that think laterally…..and it appears that is not many. While I agree with your thoughts, with colour added from Skippy, I wonder if this tribe of ‘elites’ does understand the ramifications of climate change and instead of acting to mitigate the process they are actively delaying and distorting efforts so as to let the climatic changes do the dirty work. That would allow them to live guilt free futures somewhat. A global genocidal purge may be unpalatable even for that lot.
        This may fill in the details on why we have so much distortion of the facts and figures on Climate Change.

      • they are actively delaying and distorting efforts so as to let the climatic changes do the dirty work

        That very thought has been in my mind of late.

        It’s probably not a conscious strategy. But subconsciously they see themselves escaping the Holocaust that will consume everyone else.

      • Hands up everyone who’s over 50!! Oh no need, we can tell by your endless self pity at the dusk of your time here….

      • migtronixMEMBER

        But, yeah, at 11pm last night I finally managed to get the module working that will replace the existing heap of crap Cerner app the hospital use and which I’ve been forced to hook into. Well after weeks of 12+ hours days I’ve finally got a solution that finally stop these idiots causing me downstream issues. TL:DR I can finally take a f#cking holiday safe in the knowledge no one will call me! F#cking bliss! Worst part is this was supposed to be done by someone else last year but 100k later and not 1 line of code was delivered! Public service ha ha

      • Mig-i,

        You forgot that some time back it was determined that government should be run like a business, a corporate republic would be run primarily like a business…. cough… Citizens United… which leads us to TTP et al.

        Skippy… again your junior chipmunk badge collection is want for a historical addition i.e. decades of corporatist intervention in the political sphere has thoroughly corrupted the process to its advantage.

      • migtronixMEMBER

        Wait till I add the drag’n’drop + mobile friendly version! They’ll be eating out of my hand again wondering why they spend 3 years listening to “experts” (read consultants earning a per diem)

        Idiots all! And I’m talking about the directors of 3 of the busiest ICUs in the country!

      • Just reading comments about psychopaths by Stephen, skippy, interested party etc

        I read an article in the guardian late last year by Naomi Klein or Naomi Wolf, not sure which one, that the psychos have a lot to benefit from climate change. I tried looking for the article by googling but came up with nothing. I did find this though. Reminds me of the Omen part II, profit from human misery.
        http://www.theguardian.com/commentisfree/2007/nov/30/comment.usa. Lots of money to be made.
        What is the image that gunnamatta uses as his avatar?

    • migtronixMEMBER

      Still though, that particular exercise in utilizing the finer arts of examining a rhetorical question to its closest detail, was a right laugh.

    • Mate if the judiciary actually prosecuted and jailed all the wealthy baby boomers that committed financial crimes they’d have no one to play golf with on Sundays.

      It’s only the juniors that get nailed in financial crimes.

    Now before you start thinking of Arthur C Clarke, these things are the new generation of Russian diesel electric submarines, 40kts submerged, operating depth to 300m.
    Heard a couple of winging senators on the radio, Lambie was one, you cant miss her voice, saying we should build the new submarines for Aust in SA, where they have proven they cant even build a canoe.
    Until our sub spec can match that of the “black hole”, we should stick with airborne drones.WW

    • We need subs, they are central to our defense more than any other asset.

      Airborne drones won’t replace diesel hunter submarines in terms of ASW. If in a conflict we can’t stop the Coral and Timor seas from being shutdown to merchant traffic then we are toast!

      • Ah Jason, Anything floating is handled by missiles.
        There is no plausible argument for submarines.

        Soon we will have drone subs which shadow real subs and disclose their position. Can you afford to risk 80 billion on that. WW

  8. and while TestosterTone is riding into those headwinds……

    I notice Fairfax is running this Abbott displacement line heavily….

    Turnbull and Bishop approached to take leadership as senior ministers rally support for the PM



    Prime Minister Tony Abbott prepares to dump paid parental leave scheme


    if I was a Torynuff backbencher I would be wanting advance warnings of those ‘Captains Picks’ TestosterTone keeps rolling off the distribution curve

  9. Crude climbed 7% overnight


    with the decline in drill rigs in the US apparently the trigger.

    If you want to follow the drill rig numbers a journo who has been doing so for quite a while is john Kemp at Reuters

    He has had two illuminating pieces on the drill rigs and factors around fracking this week. He reckons the production really starts to drop after May.

    North Dakota oil rigs drop points to U.S. output decline after May: Kemp


    this is a good read too…..

    Factors that will drive U.S. oil production in 2015: Kemp


  10. I’ve got an interesting weekend planned…or closer to the truth….planned for me!

    As it turns out someone has been peeking at our results and Connecticut’s very old-money wants in. I’ve been given a primer on investor care abouts and topics to touch on and topics to avoid. Interestingly high on the care abouts list is a topic best described as social conscious…what good will we do in the world.

    The senior partners are beyond pissed that I got this invite and are all adding their tuppence worth of advice (very revealing actually… morally bankrupt doesn’t come close to describing their advice).

    Let me share some of the partners advice
    – bring a model as my friend (apparently his daughter is known to have a keen eye for the female form) and make sure you get some pictures …honestly
    – Money is its own morality, without money all other philanthropic efforts go unfunded…we can make you money!
    – Our poor need to understand why they are poor, what critical turn they took that led them to poverty. They can only fix their lives if they understand their problem ( notice that the poor apparently choose poverty)…wow…people actually believe this!

    OK ignoring the above…my topics for the weekend
    – Today’s underfunded boomers are tomorrows chronically poor…. demographics / health improvements guarantee it.
    – Dementia is a huge looming problem so finding / funding solutions is our obligation.
    – Over one Billion Chinese believe that the world owes them an American life style…the world clearly cant sustain this so logically over 100M Americans and the same number of Europeans will need to surrender their lifestyle. So that a few hundred million Chinese can live the American dream…..How does this happen without political and social upheaval?

    – I must admit I’m also coming up short when it comes to ways that our investment strategy (predatory and algo driven as it is) will create any sort of social harmony…one partner wants me to focus on how well paid his domestic staff are. (..are no! not going there)

    I guess I’ll be rereading (mining) some of Stephen Morris’s and Skippy’s posts…unfortunately I doubt their words can leave my mouth without tripping on the way out.
    Humorous and serious ?

    • Humourous: I know half the audience already has dementia otherwise you morons could have worked it out yourselves.

      Serious: If you can’t see this for what it is I don’t want you here, I have better things to do with my life than make “money”

      • Humorous: Probably true but never wise to point it out
        Serious: At the moment for me its about playing catch-up, once I’ve repaired my personal bottom line, I can fund my own dream factory, up till that point making money does have a purpose.

    • Hi CB,

      I’ll leave the moral chasm alone, that’s your issue to embrace.

      As for the lift in lifestyle, then that is entirely possible for most countries including China. I don’t believe it’s the case that for me to gain you must lose.

      Considering we measure the quality of our lifestyle in how much we have in material assets and what services such as education and transport we enjoy, then it’s easy enough to supply that within our system. After all as you spend to buy ‘stuff” I prosper by supplying it and vice versa.

      Whilst we can’t all get rich by making coffee for each other, we can all subsist with a high quality of life by supplying what each other needs, as long as the circle of supply and demand is complete.

      Best of luck with that chicky babe they are going to line up for you. someone has to do the hard yards.

      • @Peter Best of luck with that chicky babe

        Yea they showed me pictures OMG and a relationship story I’m supposed to spin… truth is she’s flying in from Brazil, she’s drop dead gorgeous, so they want to be sure she’s not known on the local scene.

      • You’re a stronger man than I Bob. One of the reasons I resigned from a bank and worked for myself was that I had to give BS talks that I seriously objected to. I knew at that moment that I was unemployable in mainstream commerce.
        I actually find it hard to believe that in this day and age a false front is required in business dealings.

        I just can’t do that, but I hope that it goes well for you.


      • migtronixMEMBER

        Ahmen Pete. For me its not the “chicks” its the ENDLESS STUPID PARTY

        I just can’t f#cking do it

      • Oh well survived the first day / evening…dont believe I said anything too stupid. I’ll tell you that the partner that demanded I take a babe was right about one thing, the investors daughter was all over her like a rash although I must admit she is stunning (the arm-candy that is, the daughter..as they say in China…has very nice hand writing)

        Their financial team wanted to take a deep dive into the Algorithm structures but frankly they’re clueless when it comes to combining derivative structures with direct investments to balance risk I tried to explain spatial / temporal sampling theory because it’s essential to understanding how the Z domain filter structures function. They’re probably all back in their rooms Goggling Z domain theory.

        Only tomorrow’s Brunch and I’m out of here, I must admit I pity a life so wasted on creating the continuous party that they never achieve anything for themselves….who cares if the worlds best and brightest beat a path to your door if you cant understand what they have to say!

      • CB
        Well they say that Wall St is where men are chauffeur driven in a Rolls Royce to get advice from people who take the subway.

        Cheers Bob, glad it went well.

    • There will never be a time when one billion Chinese live like Americans. The top will be one or two hundred million. Only half of all Americans live like Americans

      • True, we live better. However if we don’t count dollars in the bank but instead count lifestyle, ability to take time off work for leisure, health, lifespan, access to services, education, technology and amenities the common man is far wealthier than the Pharaohs of the past, and we can offer that to all nations if they have the political will.

      • However if we don’t count dollars in the bank but instead count lifestyle, ability to take time off work for leisure, health, lifespan, access to services, education, technology and amenities the common man is far wealthier than the Pharaohs of the past,

        What about the Pharaohs of today Pete? Lord Blankfein can magic up some “dollars in the bank” and — hey presto! — you’ve got yourself a downtown mausoleum.

      • True Stat, but that’s only half the problem because that leaves over 900 M Chinese that cant possibly realize the dream they’ve been sold AND 200M westerns that loose the comforts their position in society should afford them.

        @Peter I’m always the first to suggest a larger pie is the solution, unfortunately we still occupy a planet with finite resources so there are limits to the realizable size of the pie. The recent (2004-2010) spike in IO prices was caused by China consuming significantly less then its fair share of the worlds resources this process led to the quality of China’s internal IO resources being significantly depleted, at one stage IO was being mined that had less than 15% Fe content…the world cant afford solutions that are this desperate.

      • Wow – you guys are defeatists.

        There is nothing that can’t be built or provided if nations have the political will to do so and share it amongst the populace.

        • Yes, after trashing the external facing economy to fit in a mining boom, and ploughing the proceeds of that into creating simultaneously the amongst worlds most expensive real estate and privately indebted people, while currently using that uber expensive real estate as a shield against any type political or economic reform, leaving us selling the real estate to those foreigners without the wherewithal to buy any non foreign owned productive assets we have left to sell – it is only the will which prevents us from achieving our destiny.

          I hope the crowd down in the real estate Reichsbunker are sending out orders to have defeatists and deserters dealt with appropriately……..

          Ein Volk, ein Reich, ein Mortgage opportunity…..

      • Ah sorry. my fault, for a minute I forgot that you guys enjoy losing.

        As you were, carry on fellows.

      • migtronixMEMBER

        Dementia, natures way of telling you that you have lived too long and over indulged.

        Or… you know… you were pedestrian to begin with (… I wanna say … dumb? Uninterested? Lived for someone else?) ….

        Soooo many of the writers of antiquity I admire most lived past 70. Like Newton. It wasn’t just wealth. See countless emperors….

      • @ FF
        Not really, anyone who trots out Hitler to make an absurd point is a loser in any language.

        I come to talk to adults, the children are hopefully in another section.

    • CB, until you learn this by heart, you are going to spend your whole life spinning your wheels.
      ” Our poor need to understand why they are poor, what critical turn they took that led them to poverty. They can only fix their lives if they understand their problem ( notice that the poor apparently choose poverty)” WW

      • migtronixMEMBER

        HIlarious!! The poor choose poverty but some bogan redneck who bought a place in west sydney for $20k 40 years ago is a f#cking genius millionaire investor!

      • interested party

        WW, good call.

        Moral destitution…….or a growing sense of cognitive dissonance. The jury is still out from my end…….

    • As viewed on Hannity’s Great American Panel some time back, a man that could have been a body model for an old English political Mug cirica 16th – 17th century’s spittlingly said…. Poverty is a mental disorder…. everyone knows that….

      Hannity seemed to blanch a wee bit, even to openly honest was his comrades public utterance, for his liking. Kids have ears you know…

      Yet meta studies going back over 50 years conclusively show the first 5-7 years of a humans life has the greatest influence on the remaining, diet, mental stimulation, nurturing social enviroment, et al.

      BTW been there and done that wrt to your predicament, hence why I left, the incessant chatter of self affirmation is probably a tool in Gitmo.

      Skippy… just be an A typical parochial Australian stereotype and your good too go…

      • just be an A typical parochial Australian stereotype and your good too go

        Actually that’s what worries me most…my kids all laugh their asses off if I even try to speak “proper” Straylian….Hoges is definitely not my style.

    • migtronixMEMBER

      Let me try serious again (still can’t beat humorous)

      “An ageing world is a world facing large scale health and quality of life issues. You’ve seen what the power of software and communication technology can do to enhance the profitability of market participants.

      Get ready for what it can do to your bottom line and the experience of your customers!!”


    • Money is worthless unless it serves a mission, and there will be no greater mission and no greater money to be made over the next few decades than taking care of the world’s ageing population.

      *sage nodding*

      At CBVCNH and Partners, we want our future clients to be able to say – “I just got back from a pleasure trip. I took my mother-in-law to the nursing home !”

      *mild chortling, some throat clearing*

      Ah…within our grasp is the key to relieving the horror of dementia for millions, unlocking a fortune in revenue for investors, and significant savings for government’s and families struggling to keep up with the rising cost of aged care.

      *the audience’s eyes narrow as thin smiles form*

      • HnH, probably the second thing one asks in a business presentation is “where is the source of the money” If there is no money to be made it is not worth doing!
        The problem for the ageing population, and for those who intend to provide, sell, the services to them is that they have no money.

        Providing aged care is a ponzi scheme nearly as ruthless as the housing business. The money has already run out and the aged are being asked to mortgage their house/s to maintain their upkeep.
        For a real time model, look at Greece.
        The wealthy are making their own arrangements for a real time model look at Monaco WW

      • Where is the money ? $9bn in govt funding in this country alone, $120 per resident per day. The potential efficiency gains to govt in aged care are phenomenal.

      • Lot of truth in what WW says, globally Aged care as a business has past the tipping point, it’s only in places like Australia that our housing “wealth” still enables this ponzi scheme to function for those less well to do souls. Without these “saving” the structure of the whole industry must change. Aged care efficiency must improve….bodes not well for quality of care unless we make some major discoveries that enable us to largely eliminate the need for so called “High care”. I’ve got a feeling that structurally we’ll have to find very inventive ways to deliver efficiency….welcome to the Liverpool pathway.

      • within our grasp is the key to relieving the horror of dementia for millions,

        LOL … and all those stupid pharma companies pouring billions upon billions …

        Dementia, natures way of telling you that you have lived too long and over indulged.

      • migtronixMEMBER

        Dementia, natures way of telling you that you have lived too long and over indulged.

        Or… you know… you were pedestrian to begin with (… I wanna say … dumb? Uninterested? Lived for someone else?) ….

        Soooo many of the writers of antiquity I admire most lived past 70. Like Newton. It wasn’t just wealth. See countless emperors….

      • Or… you know… you were pedestrian to begin with

        You are very right indeed mig. You’re genes rather than you were pedestrian to begin with.

    • migtronixMEMBER

      Honestly though Bob WTF is wrong with people?

      If they’re too stupid too see what you’re doing, but aren’t so stupid too see that you’re sincere in trying to explain to them — AND they can they see the transactional acuity — why the f#ck wouldn’t they just aknowledge they’re dumb but still money hungry and see a good thing when its made obvious?!?

      I swear to Their God I just want to live out the rest of my days on beach somewhere, writing philosophical tracts that someone in 1000 years might bother listening to….

      • Weekends work completed… very successfully if the initial partner feedback is anything to go by…for them that means zero’s and lots of them.
        Frankly I’m still clueless as to why “socially responsible investing ” was billed as such an important issue, surely these ethical Hedonists have more pressing personal issues to explore before examining the morally murky waters of hedge fund investing.

    • I’ll watch an 18 hour train journey where the camera shot is a closeup of the track the whole time over test cricket any day! And, btw, test is the best cricket 0.o

      • migtronixMEMBER

        You don’t get it, I enjoy test cricket 😉

        And, yes, I very much enjoy seeing where they f#cked up the track work, or where it’s obvious a deer had recently met it’s end….

        I’m an observation nerd above anything else. .

  11. ‘NSW police plunged into controversy by sensational bugging inquiry claims’

    ‘NSW Police Force seeks 7-year data-retention scheme
    Summary:Australian state and federal law-enforcement agencies have stressed that they are being pragmatic in accepting a two-year data-retention period and not being able to access web-browsing histories.
    If privacy was no concern, Australian law-enforcement agencies have said they would like a wider selection of telecommunications customer data for much longer than two years, including the retention of every Australian’s web-browsing history.’

  12. Central Bank rules will not stop house prices from soaring – John McCarthy – Irish Independent.ie


    … concluding …

    The solution to these problems is to build more houses. The obstacles to new housing construction are manifold and complex. But they include scarce development finance, inviable planning requirements, concentrated land ownership, prohibitive local authority levies and the 13.5pc VAT rate on new homes. It is critical that our policy effort to control house prices is now firmly fixed on these problems and not distracted by side-issues like mortgage lending restrictions, which were designed for an entirely different purpose.

    Dr John McCartney is Director of Research at Savills Ireland

  13. Boilover in Queensland?

    #Galaxy Exit Poll QLD State 2 Party Preferred: LNP 46 ALP 54 #qldvotes #auspol

      • Malcolm has engineered a quite a feat delivering a speech in the US on Good Leadership just as LNP support collapses in Queensland.

        “Leaders must be decision makers, but they must also be, above all, explainers and advocates, unravelling complex issues in clear language that explains why things have to change and why the Government too cannot solve every problem,” he said.”

        Clearly a planning maestro 😉

      • “This really is an extraordinary night. For the second election in a row, Queensland is making history.

        After the biggest defeat in history in 2012, leaving Labor with seven seats in an 89 seat parliament it is now looking likely Labor will win enough seats to form government and premier Campbell Newman will lose his seat.

        ABC’s analyst, Antony Green, says Labor is on track to win 46 seats. They need 45 to form government.

        Green can’t believe the swings he’s seeing and stops short of calling the election. He says it will get down to pre-poll and postal votes.”

  14. Distorted Irish economic data …

    The idiot/ eejit’s guide to distorted Irish national economic data … Michael Hennigan … Finfacts


    The Irish do not work as hard as the Google numbers may suggest … as just one example of many.

    One suspects the Chinese are even more creative .

    There is much to be said for simple and clean measures … for example with respect to housing …

    2015 11th Annual Demographia International Housing Affordability Survey


    Report: housing affordability out of sync with incomes … Hugh Pavletich … Sydney Morning Herald


  15. It looks like Newman has lost QLD.

    We’ve a very, very blue blood from QLD staying with us tonight and she:
    a) can’t believe it;
    b) thinks that they deserve it because Newman is a f**kwit.

    This does not bode well for Mr. Abbott.

    • The neo-fascist klepto’s and their austerity madness in Qld and Canberra is headed for disaster.

      Abbott is certifiably insane. The knighthood to an ageing greek royal was plain loony.

      There is a clear sense that people are terrified of him.

    • Never been prouder of Queenslanders. Didn’t expect to see this result tonight, but this is an emphatic rebuke of a(nother)terrible government. Newman got what he deserved. Abbott next.

    • At my location:

      Number of days over 30C for January 2015: 12. Average for January: 4.2 days.
      Annually: 10.6 days.

      But obviously your anecdote is much more important than mine.

        • I’m not in Melbourne, but Geelong is highly reminiscent of late July today.

          Just crossing the divide is what is needed for something warmer at the moment. Most of Australia has had a fairly hot summer but the southern littoral has had persistent onshore south westerlies except for a few days near the new year.

      • Ah Lorax, if it is so frigging hot down there, how come you and Marshy dont just have cool showers instead of all this solar hot water nonsense. Or is it maybe as a result of Marshy still chopping down trees and causing a localised heat bubble on his farm.
        You know the old saying, if it is hot in Lismore (pick any town) it is Cool in Gatta. Magic day here.


      • migtronixMEMBER

        How does it help to know you’ve been having an awesome summer when here it’s been winter the last week and last night was an incredibly sh#t night.

      • migtronixMEMBER

        But but don’t worry Lorax when it’s 35 here next Saturday after winter leaves in a couple of days, I’ll report back how awesome it is. People will be out in St kilda like nobody’s business.. Actually St kilda fest is coming up.

      • If the Liberals hold on to Abbott, they’re gone in the next election.

        If they get rid of Abbott, the ‘Leader Merry-Go-Round Disease’ will take hold (from Labor) and they’re gone in the next election.

        All this is win/win for the Australian people.

        The political class need to listen carefully to what is being said by the electorate and reflect that in their policies to win/hold govt.

        After all, isn’t that what ‘democracy’ is all about?

        We have a country of plutocrats running the government for big business.

        ‘Plutos’ not ‘Demos’.

        And now, after the biggest economic boom in 100 years, all we have to show for it are massive cuts and a looming recession.


        Debt servitude.
        Unproductive economy.
        Cuts to essential social services.
        And a Neanderthal PM.

        The Australian people have been dudded.

    • Yes, I did my part up here yesterday, a long time since I voted Labor, I usually vote independent on principle.

      Such a shame, LNP are far better managers, we can feel that at the coal-face but they just can’t understand that most people view their favouring their family and political friends in dealings with public money as corrupt practice.

      They are the same corporate types who made me retire early. I can stand any amount of nonsense but will not tolerate being lied to.

    • This is what happens when you begin to believe your own lies (eventually). I just think this is how all (yes all) Kantian ideologues end up.

      Below a quote (ABC) from Campbell Newman, an insult from the black heart of a believer in ‘trickle down’ economics. A bogus theory dis-proven having no credibility.

      “Our hospitals are working better today, the state is safer with more police and strong laws that protect Queenslanders, and our kids are getting a better deal”.

      Greece was the beginning of a renaissance in politics and economics. The beginning of a great and protracted struggle to reclaim democracy for, of and by the people.

      • Absolutely tony. The Greeks gave us democracy, maybe they can save it for us. We need a new enlightenment.

        Liars, thieves and cheats of all stripes OUT.

        Hey Abbott… TICK TOCK!!!

    • The LNP can win the next election BUT it will take nerve, courage and a big change in ideology.

      1 Ditch Abbott
      2 Rejig front bench
      3 Establish a framework for change (based on Auatralian values of fairness and a fair go) to take to the next election
      4 Propose policies that are futuristic – NBN, affordable housing, taxation reform, spending aligned to national needs…

      Listening to the LNP commentators this morning I cant see them getting their act together.

      • It would require a complete metamorphosis of core ideology. That wont happen. They would practically have to become Syriza. Abbott would have to become Tsipras, Hockey / Varoufakis (would need to loose some blubber).

        Wont happen.

        • That conjures up some bizarre thoughts. Just imagine Kevin Andrews repudiating national debt….. or Christopher Pyne arguing the people are suffering for no point

      • Can.either of the majors form a clean government? If so, they should push for a national ICAC. Flushing the system wull be the only way of establishing change. Tony Fitzgerald’s influence on the result is not receiving as much play as Tony Abbott’s, but his speaking up would have swayed many away from the LNP. It also showed the value of only speaking when you have something worthwhile to say.

        • Its that prospect which for mine makes the next federal election sort of mouth watering.

          I could imagine – given that I think the Torynuffs are approaching unelectable and that the ALParatchiks remain unelectable after the last election – that it would be a good environment in which to put a coalition of the willing to drive change and shatter the grip the politico housing complex has over the nads of the Australian body politic.

      • @gunna. After watching Shorten on the insiders this morning I agree. My wife – who knows nothing about the political scene – asked me, “is he reading those answers?”. It’s not that he’s unelectable, but he’s not going to enthuse the public in any way with a dull, same-again political persona.

        Seems to leave a very real missing piece in the political landscape, which is someone who can appeal to the peoples grievances. I can’t see anyone currently in the field who could step up and do that, which suggests a pretty attractive niche for an interested party…

    • Queenslanders will reget this return to bankruptcy. But at the moment they don’t care.

      What % influence did the following have on voting

      Newman Governemnt
      Abbott Government
      Alan Jones on behalf of the Labor Party
      Inclement weather
      Imposition on a Saturday when you’ve had a gutful of politics

      There seems to be several Queenslanders here, I’d be keen to know.

      • LNP on the nose everywhere, but especially Abbott. Voters are waiting with sledgehammers. There has to be a change this week.

      • Did you vote? I agree Abbott is on the nose, but I’m interested to hear why those that did vote voted the way they did.

        Abbott’s at the Press Club tomorrow…

      • I’ll repeat this comment for 3d1k’s sake.

        Queenslanders are not “returning to bankruptcy”. They never escaped from bankruptcy.

        It wasn’t that the LNP policies were “tough”. It’s that they were stupid, self-serving, corrupt and counter-productive.

        The sale of strategic monopolies and tax farms (Iike the toll roads now sold to Transurban) to paper over a chronic budget shortfall may be “tough” but it’s also pointless.

        Far from improving the problem it makes it worse. As we have seen in one jurisdiction after another, as soon as borrowing capacity is freed up through the sale of such assets, the corrupt politicians then turn around and spend it again in their attempt to buy votes in the following elections.

        This may be seen in the history of public debt in the United Kingdom which reached a nadir in the early 1990s (following the massive Thatcher sell-off, much of which was actually “good” privatisation aimed at improving efficiency in contrast to Australian privatisation which is almost always of monopolies and tax farms). But by the mid-2000s – before the GFC – the ratio of public debt to GDP had surpassed its level of 1979!

        It may be seen in the Howard/Rudd era where Howard’s debt reduction – achieved in good part through the one-off sale of Commonwealth assets like airports, residual Telstra, radio spectrum and other monopolies – was spent, first by Howard himself in his desperate attempt to win the 2007 election and then by Rudd thereafter.

        Even Newman had announced is intention to start pissing the proceeds up against the wall even before he had received them.

        $5 billion was to be sunk into a megaproject – a hole between Dutton Park and Victoria Park – precisely the sort of project that wins politicians lots of friends amongst big contractors and financiers (who have campaign donations and directorships to offer in return) but does little for the economy.

        The problem lies not in the People but in the system of government.

        Under the corrupt system of non-democratic elective government, politicians are “adversely selected” to be megalomaniacs intent on pursuing their own schemes rather than the interests of the subject they rule.

        The Labor Party will be no better. They will do nothing to address the underlying problems. They will spend their time trying to appease their own influential minorities while ignoring the interests of the People.

        Elective government is government for the wealthy and the well-organised.

        Unless the system of government can be changed we are doomed.

      • Thank you Stephen. It is apparent that democracy as we have it encourages parties and voters to gorge on a feast today to be paid by taxpayers of tomorrow.

        It’s destroying itself.

      • A return to bankruptcy ? Not sure what you mean by that. I think we have just avoided exactly that outcome. The complete bankruptcy of our democratic system. Voters were at least astute enough to recognise that Newman was prepared to trash the reforms of the post-Bjelke Petersen era that he could only see as annoyances, impediments to doing business *his* way.

        I have had some dealings with Newman and his wife, and they are both decent people in their way with a genuine desire to give back to the community. I think most people saw that in him when he was working in City Hall, and were prepared to give him the chance in higher office when it became clear Bligh’s ALP crew were taking voters anger over the privatisation issue for granted.

        But at the same time, Newman just couldn’t fathom what all the fuss was about the Executive branch interfering in the judiciary. He also carried over the same blinkered approach to financial management which simply cannot countenance the existence of government debt (sustainable or no) or government ownership of assets.

        Everything about the LNP approach seemed rigged from the outset – the stacked audit including Peter Costello and Doug McTaggart (Chicago School of Economics alumni); the heavily marketed public consultation process on policy priorities which was then swiftly ignored (and which was telling him clearly a year ago that voters didn’t want assets sold, and would countenance higher taxes).

        He put the legal fraternity offside, the medical fraternity offside – quite an achievement for a conservative leader. It is telling that the LNP retained most support in developer heartland, the Gold Coast.

        The worst of it was the saturation of spin, spin, spin which seemed like a constant rebuke to people’s genuine concerns.

        Ultimately Newman was his own worst enemy – the antipathy had been building up for over two years and so he didn’t do himself any favours by so cynically calling an election during school holidays. It was transparently self-serving and seemed tricky, and reeked of contempt for due scrutiny.

        Abbott was a secondary issue for some, but you’d be kidding yourself to write it off as a factor altogether. It would have been impossible to stop the kind of antipathy that Abbott invited in the past month from leaching over into any political equation involving the LNP brand.

        Alan Jones doesn’t get much exposure up here – so it was strategically a pretty stupid call on the Courier Mail and LNP’s part to bring more attention to it. That said, Jone’s morning diatribes were surprisingly vicious (not sure why would you think he was siding with the ALP on that ? Pretty far fetched conclusion if you know Alan Jones )

        Queenslanders waited a long time to rid themselves of the Bjelke Petersen era cronyism; it is pleasing to see them quash its potential re-emergence.

        EDIT: That Murdoch would twitter that this was an “okay” government speaks volumes for his lack of comprehension.

      • interested party

        I am in Qld.
        75% based on distrust and failure to explain basic economics to public. Debt levels and ratings not understood.
        10% based on a growing hatred of big business pulling strings and pollies being puppets to oligarchs and not the voters……..public servants????
        2.5% Jones has a spotty following ……scattered…….Laws is bigger I think?
        Sunny where I voted
        2.5% cannot deny that feeling though
        10% on naked tribalism…..red vs blue…..blind ineptness…………you cannot breed that out of some people

        More of these outcomes in the future….stability has vanished….chaos is the new stability.
        Stephen Morris has posted today……..very relevant.




    The situation for Greece cannot get worse, they are below zero as is.

    But if Greece exits the Eurozone, it appears the situation for GERMANY is ruinous.

    Still, the mutant euro con benefitting only Germany is going to end.

    “Germany has room for fiscal manoeuvre. The message from Greece’s election is that Merkel should use it before it is too late.”

    Its already too late. Look over there MERKEL!

    They’re called “PODEMOS”!!


    Tick Tock.

    • Other than the austerity demands, how does Greece being tied to the Euro differ from a ” poor” US state being tied to the USD?.

  17. “Europe will continue to show its solidarity with Greece, as with other countries hard hit by the crisis if these countries carry out reforms and cost-saving measures,” Merkel said.


    “Please just die. We promise to pay for the funeral…. Maybe.”


  18. Goodbye and good riddance to Newman and (hopefully) his stupid party

    During the QLD election, there’s been plenty of promotion of the coal industry though – the world’s leading contributor to greenhouse gas emissions that cause climate change

    Jayakumar Janakuraj, the chief executive of coal company Adani Australia, even turned up on the campaign trail with LNP leader Campbell Newman.

    The Newman Government has done all it can to promote and defend the coal industry during its term in government.

    One of Newman’s first moves as Premier was to scrap the state’s Office of Climate Change

    To get at the untapped coal in the Galilee Basin – one of the largest stores of fossil fuel carbon on the planet – the Newman government has offered royalty discounts and, to one mining company, a cash loans in the hundreds of millions to back a rail project to get the coal to port.

    Analysis from the Australian Conservation Foundation has said if all nine proposed Galilee Basin mines went ahead, the burning of the coal would add 700 million tonnes of CO2 to the atmosphere every year.

  19. This whole election outcome is related to the recent collapse in the price of oil. How.?
    Until recently many of us believed oil was a commodity of limited supply, and of some value.
    Now we learn that the price of oil is able to be manipulated.

    This oil price collapse example has shed doubt on the other pillars of value of our society, the value of houses, the value of super, the security of a job, the stability in the future cost of living, the diving value of the Aussie Dollar, and for many even the opportunity to get a job.
    Add to that the demonstrated uncaring aloofness of the Qld Govt and the increasing ineptness of the Federal Govt. To say the punters are now spooked and jumping at shadows is an understatement.

    You are going to hear many tales of what happened in the QLD election from the MSM. But this is what really occurred.
    3 plus years ago when Newman stood for election, the punters were all aspiring property developers and real-estate landlords. Many increased their debt and bought new SUV motor vehicles and other lifestyle enhancements to demonstrate their new planned opulence.
    In their commercial or business world everything was go, the income from mining and developments for the coal seam gas construction, was carrying the debt repayments from their non profitable non sustainable “investments”.

    About 2 years ago, for the observant, it started to turn pear shaped,and about 6months ago those still reveling in their castles in the air, noticed the sky was falling.

    First the drought struck rural areas, but no one cared about the people on the land
    Then the price of coal was forced down by oversupply, mines were closed, or temporarily shut.
    Miners were laid off and with FIFO, the effect was spread into many coastal towns.
    Then the price of copper and lead started its decline, and more FIFO miners were sacked.
    Then the price of electricity, gas and water, started its climb. Companies and many restaurants could not afford gas and electricity.
    Then boarded up shops started to appear in the shopping malls and streets of small towns.
    The high dollar and ageing facilities killed tourism for the traditional tourist hot spots.
    Many, unheralded, business closed.
    Newly constructed high rise buildings on the Gold Coast stand empty.
    Investment properties placed on the market fail to sell, or even attract bids.

    Then just before Xmas the price of oil took a dive.
    This dissolved the value of many companies on the stock market, and when combined with the marked down value of the iron ore companies, and include BHP and RIO, the share portfolios of many super funds were now significantly in the red. Many punters, who had spent up over Xmas on the advice of Joe Hockey, now had big debts and no super dividend to pay for them.

    The price of gasoline at the bowser now goes into free fall and the oil gas companies now announce the planned construction of LNG projects will be terminated early.
    (There will be 16 thousand persons made redundant from those projects this year.)

    Now the punters are starting to get the picture that a storm is coming.

    To solve the massive debt hurdle the state has, approx 70 billion, with no income to pay that down, the Govt now says they will sell off assets to get some money back and also to help fund an unprofitable coal mine of one of their new billionaire mates Adani.

    From a punters perspective the outlook now is:
    Job security has gone, thus the threat of default on their debt is now probable.
    Most of their new cars are at the end stage of their free maintenance period. Modern cars are set up such that they have to go back to the dealer for service, and maintenace cost as a brown paper bag.
    The dollar is down 16% so everything we buy which is imported will go up by at least 20%.
    Those with money in the bank find lower interest rates do not allow them to live from the interest of their savings. (this is super critical for retirees)
    Housing has peaked, essentially when Newman was elected, but is now observably in decline.
    (All the budding real estate entrepreneurs are now sitting on losses, fear for their jobs and hope a Labor Govt will provide the next handout)
    Those in the regional towns see youth unemployment running as high as 20% (this has to be a new record for white Australians)
    Then:The LNP team are labeled as setting a new low, by Govt watchdog, Tony Fitzgerald
    And Newman’s mate, Tony Abbott appoints a member of the Royal Family as a Knight and overlooks many eligible Aussies. (an absolute politically terminal action, but maybe endorsed by Credlin)

    So to save their personal skins, thinking hopefully the ALP will, somehow keep helicoptering money into their increasingly vulnerable jobs, they voted for their only alternative.

    Just how the ALP tacks the ship into the increasingly forceful headwinds of
    no cash in the bank
    no royalties from exports
    a falling dollar
    a rising unemployment rate
    an ageing population
    unemployable youth
    the impact of AI and robotics
    union pressure to maintain jobs in unviable industries.

    We are going to need a skipper better than we have ever had for any Americas cup or Sydney to Hobart. First thing, when the crew sobers up, the ALP is going to need is a good navigator. WW

    • It was never intended that Tony Abbott would be the PM of Australia. He was supposed to hold court until the real contender for that position emerged later from the LNP. But, Labor imploded and lo and behold, Tony got in! I’d wager it’s the same with Annasatcia Palaszczuk ( They were Palachooks when I went to school!) She wasn’t a show of actually winning and the LNP would have been sobered by a bit of a hiding. But now you have the unexpected again…and it’s likely to be as much of a shambles as the unintended Abbot Government is proving to be….

      • Janet. Are you a Queenslander, now living across the dutch??

        Yeh something is wrong, if you attempted to run a business like these guys try to run a country, even allowing for the social implications, you would be sacked at the first board meeting.

        The eye opener for me, was the reported high levels of youth unemployment. That is a time bomb, things are moving so fast that these people will never catch up. How that is managed I dont know. You cant just keep throwing money at it as increasingly the money is being quarantined by the super wealthy. There really is less and less going around, despite the printing.
        Good to hear from you.WW

      • migtronixMEMBER

        And the one thing any of these shambles governments will absolutely not touch is all the housing/super perks. They both know what it would mean, a generation turning their backs on the them

      • bolstroodMEMBER

        @ Janet
        Would you be able to throw some light on how NZ changed it’s parliamentry system from the 1st. past the post ,winner take all , to Mixed Member electorates. How were the major Parties covinced to give up their monopoly on government?
        Australia cold use a similar change.

    • migtronixMEMBER

      Bloody well said. Those spooked and jumping at shadows are going to pour even more money into RE as it gains safe-haven from the storm status.

    • WW,

      Everything under the sun is financially front run, the engineers take profit early and rinse and repeat.

      Was just talking to a mate last night about intercity highrise developments, only need about 12% occupancy and they’ve made their bundle.

      Same same for all the fracking stuff in America and here, expand that paradigm to almost everything.

      Skippy… so the question is who created the environment for this kinda action….

      • MAte, the answer is the easy access to low cost (in real terms) money.
        HnH will tell you money has no value unless it is working,
        even if it is bringing in a small return is better that no return, hence all these projects which would stall if money was expensive are on the roll.Sooner or later money will have no value. then we move into forms of currency which cant be easily duplicated. Gold is probably the go. Russia reportedly buying up gold in preparation for a collapse in the USD. This oil collapse is designed to wipe out the USD. It will succeed.WW

      • WW,

        We agree on the miss-allocations of money – capital [tho not one in the same], although we are completely divergent wrt money creation, destruction and quality thereof.

        Probably the biggest divergence is the historical aspect and resulting observations, well over 5000 years of data to extrapolate imo. Persoanly I find the money problem a sub set of more intrinsic issues e.g. ideological.

        I.E. Laws and Rules trump money, so the question is who is making the laws and rules and what agency informs them, what ethos enabled such wild speculation wrt asset valuations after the lessons of the GD.

        Skippy… you’ll have to excuse me when I say the ev’bal is in the details and not the object.

      • Mate, I had to set it out for my own thoughts, you dont get swings like that unless the punters are frightened. Many will be first time labor voters.
        So in summary, Newman was voted in on greed, they all thought the mining boom would last for ever, and housing was just too simple to not be in.(you cant be a capitalist and vote Labor)

        Now, with everything going to pot, and jobs in short supply, fear has set in, and Labor are going to be encouraged to do the helicoptering. (you cant expect handouts and vote Liberal)

        I have no idea what is going to happen, but I made a few quid on Newman being tossed.WW

  20. interested party

    A few things about last night.

    What has been exposed is the complete unwillingness of the Queensland people to accept the tough decisions. Newman was always going to be the political sacrifice as soon as he took office. The preceding Lab gov left the state in a terrible mess and no matter who got in after them, they were toast. This script will play out in the Federal election…….and then state after state after state…..We as Australians have been ‘blessed/cursed with no recession for umpteen years and the veil of complacency rests heavy over us all. The recession that is on the way will be like no other in living memory; and that will fuel the political torment of the Australian people and their total unwillingness to accept the tough decisions.

    Greece is at a point in history where a glimpse of our collective futures will be exposed. The scene has been set, the players are in position. If the new Greek government can block the ECB and Troika without some assassination or threat of military action…..and Greece regains her sovereignty, the future will be much brighter for many on this planet. What will have happened is the ‘elites’ have been turned back, to some degree. This will give people…even Australians….some direction and hope, that change can happen, that we can dissolve this facade of a democracy, and another political system can be built that caters for the common man and not just the .1%ers.

    Watch Greece.!!! Our future is in that country’s fight. If Greece goes down…….these days will be looked back at as the best years in humanities history. Dark days are certain.

    • It wasn’t that the decisions were “tough”. It was that they were stupid.

      The sale of strategic monopolies and tax farms (Iike the toll roads now sold to Transurban) to paper over a chronic budget shortfall may be “tough” but it’s also pointless.

      Far from improving the problem it makes it worse. As we have seen in one jurisdiction after another, as soon as borrowing capacity is freed up through the sale of such assets, the corrupt politicians then turn around and spend it again in their attempt to buy votes in the following elections.

      This may be seen in the history of public debt in the United Kingdom which reached a nadir in the early 1990s (following the massive Thatcher sell-off, much of which was actually “good” privatisation aimed at improving efficiency in contrast to Australian privatisation which is almost always of monopolies and tax farms). But by the mid-2000s – before the GFC – the ratio of public debt to GDP had surpassed its level of 1979!

      It may be seen in the Howard/Rudd era where Howard’s debt reduction – achieved in good part through the one-off sale of Commonwealth assets like airports, residual Telstra, radio spectrum and other monopolies – was spent, first by Howard himself in his desperate attempt to win the 2007 election and then by Rudd thereafter.

      Even Newman had announced is intention to start pissing the proceeds up against the wall even before he had received them.

      $5 billion was to be sunk into a megaproject – a hole between Dutton Park and Victoria Park – precisely the sort of project that wins politicians lots of friends amongst big contractors and financiers (who have campaign donations and directorships to offer in return) but does little for the economy.

      The problem lies not in the People but in the system of government.

      Under the corrupt system of non-democratic elective government, politicians are “adversely selected” to be megalomaniacs intent on pursuing their own schemes rather than the interests of the subject they rule.

      The Labor Party will be no better. They will do nothing to address the underlying problems. They will spend their time trying to appease their own influential minorities while ignoring the interests of the People.

      Elective government is government for the wealthy and the well-organised.

      Unless the system of government can be changed we are doomed.

      • migtronixMEMBER

        But Stephen, ceteris paribus, why is it getting worse?

        There is no one left who will be candid in an interview, say the way Hewston could say. So the crappy selective process is the same but the outcomes are getting worse. And here I do agree with skippy, decisions like Citizens United are a complete affront

      • Answer: “The New Elite Consensus”.

        The New Elite Consensus is the program of abolishing the ideals of the Modern Era – the ideals of Egalitarianism, popular Democracy and Self-determination – and reinstating the traditional Rule of Privilege with entrenched wealth, corrupt government, and supra-national relationships which transcend community (and even national) self-determination.

        It is becoming increasingly apparent that The Modern Era was an historical anomaly.

        Stripped of its ephemera, the history of the human race – at least until the Modern Era – has been a story of psychopaths competing with one another to gain positions of power, then using that power to dominate and brutalise their fellow human beings.

        If that behaviour changed in the Modern Era it was not because human psychology had evolved. It was just that there the environment changed briefly. It just happened that there was an advantage to be gained in training large numbers of commoners to moderately high levels of skill to operate the complex – but not fully automated – machinery of the industrial state.

        Having had so much invested in them, the commoners in turn had a negotiating advantage and could demand a better deal for themselves and their children. The social norms which so many people take for granted (Egalitarianism, Democracy, and Self-determination) were just the result of – and were contingent upon – very specific features of the economic and technological environment, features which have now changed.

        It has now become apparent that the Modern Era – far from being the wonderful, permanent new world that we of the 20th century imagined it would be – was in fact just a brief historical anomaly.

        With the rise of AI and robotics, the advantage has moved to training tiny numbers of people to very high levels of skill.

        Within a generation most of the human race will be redundant. The Elite no longer need them.

        And we are already seeing the effects, both economic and political in the “New Elite Consensus”.

        This new consensus aims to eliminate Modern Era ideals and to reinstate the traditional Rule of Privilege with its entrenched wealth, corrupt government, and supra-national relationships transcending community self-determination.

        Out with the Century of the Common Man. Back with the restored Rule of Privilege.

        In the field of egalitarianism and equality of wealth, Thomas Piketty and others have done a good job of documenting the return to concentrated private wealth. While median wages in developed countries have stagnated, the wealthy become ever wealthier. The benefits go to the “1% of the 1%”.

        And where money leads, politics follows.

        In the field of politics, the Elite have learned how to effectively subvert the corrupt system of “elective” government through a combination of:

        a) campaign finance;

        b) the promise of lucrative jobs for obedient politicians on retirement; and

        c) the transfer of strategic monopolies into the hands of private controllers, and the alienation of public revenues into the hands of private “tax farmers” (think private road tolling), making politicians ever more dependent on the goodwill of private financiers. A return to the “ferme generale” of the ancien regime.

        In the field of self-determination, local (and even national) self-determination is being abolished in favour of opaque and unaccountable supranational institutions (the EU, the web of so-called “free-trade” agreements) which can be used to impose Elite interests against any aberrant national government which might attempt to oppose them.

        Any sense of local (or even national) community is being swept away. For the Elite, their “community” transcends local and national boundaries anyway. Like the interlocking royal dynasties of old, they think in supranational terms.

        The root of this problem is the lack of genuinely democratic government.

        Had genuine Democracy – with the right of initiative and referendum – ever taken root, the gains of the Modern Era might have been entrenched. But it did not. With just a handful of exceptions, the most that was ever achieved was the corruptible system of “elective government”, which has now been completly subverted.

        Corrupt government and Elite power go hand-in-hand. When small businessmen face economic difficulties they go bankrupt. When Elite businessmen face economic difficulties, they call their friends in government and have the rules of the game changed.

        Wealth -> Power -> More Wealth -> More Power.

        If you care for your children and your grandchildren, look to the system which is destroying their future: the corrupt system of elective government.

        The only remedy is Democracy – genuine Democracy. That is the battle which needs to be fought.

        If Democracy can be won, all else will follow.

        If Democracy cannot be won, any other victories will be short-lived at best, falling eventually to the relentless power of Elite rent-seeking.

        For God’s sake, fight the battle worth fighting! Before it’s too late.

        It’s the only hope there is.

      • migtronixMEMBER

        But you agree democracy won’t necessarily deliver a different outcome, just the process that changes. In the US where they do have public initiated referenda it’s the reason we’ve seen so many States decriminalise pot, but thieving carries on just the same.

        For me this “new consensus” requires that law which created parliament has to be overturned otherwise we can always take it back. Holland was a free state for nearly 200 years and to get back in the Nassau-Orange clan had to promise to uphold the laws as they stood, including freedom of worship etc. The reformation isn’t over yet Stephen and no one is going back to a Pope dictated world.

      • Mig,
        It is also harder to find an interviewer who will let the interviewee speak. It is generally false conflict about nothings then thank yous and good night.

        I don’t disagree with S. Morris, but I also think that thus current system could be a lot better. And it is not just the politicians that are to blame.

      • But you agree democracy won’t necessarily deliver a different outcome

        I don’t agree with that at all!

        The whole point of Democracy is that it will generate a different outcome.

        Anyone who doubts that should spend some time living in Switzerland.

        The main outcome of Democracy is not that it gives the People an opportunity to have a direct input into policy when necessary.

        The main outcome of Democracy is that it removes the incentives which lead to “averse selection” of psychopathic megalomaniacs who destroy society and the economy in pursuit of their own self-interest.

        Purely elective government (without Democracy) is “Government for the Wealthy and Well-Organised”. Gilens and Page have shown as much in their study of US government policy.

        Purely elective government (without Democracy) is Government for the Rent-Seekers.

        Democracy may not be perfect, but the aim here is not perfection.

        The aim here is avoid the Holocaust that will otherwise engulf us.

      • interested party

        Stephen, re-read my post.
        I agree with all you have said…..and Mig’s take on it……

        Watch Greece!!!!
        If that chance of re-setting the playing field is lost, then yes….we are in for a bloody rough time of it.

      • So is representative democracy the problem, i.e ” i think the way you want me to govern somehow miraculously mirrors what my ego wants”.

        Maybe bring back the Greek ” stones in the jar ” system ( or whatever it was), but an electronic version , on any issues with say 10,000 signatures on a petition.

        Or give everyone a 100% to assign to issues on ballot ( that have had 10,000 signatures), i.e 20% roads, 25% hospitals, 55% affordable housing etc.

      • -> Stephen Morris

        I agree that “The New Elite Consensus” makes sense .. from the 20th century point of view. We may not be able to revert to the old world of the elites.

        Requiring large numbers of middle class to build and run the techno society was an anomaly, and clearly that model has run its course. Old world political and economic thinking would take us back to the old order, and most of the entrenched thinking is rooted in the past. However there are a couple of things that may make that impossible.

        The old models were based on the principal that the controlling elite deployed the masses to optimum effect. This still required them to till the land and produce things to create civilization. That was how we got to the amazing modern world, and the fortunes of the middle class rose towards the end.

        Once you get to the AI/Robot stage, you don’t need the masses to make civilization work – they are redundant. Not only are they redundant, but they are also not really worth subjugating. The elite can do as they please. Without the basic equation of (money === human labor), it is hard to see the point in tormenting the poor. It is hard to see why we would need people to be poor at all.

        The next point to consider is that far from being useless, the masses will in fact be of value. As content for Google.

        It may be hard for many people to accept, but the dominant lifeform on earth is now the internet. Humans will be deployed to optimum effect by this creature. In a way, the Metamind of the Internet has supplanted the Ubermind of the elites that previously commanded our destiny. Resources will be allocated, populations rise and fall and the affairs of the world will evolve to allow the Metamind to grow and flourish.

        Think of it like this. Each one of us has opinions, thoughts goals and intelligence. This is the aggregate effect of billions of tiny complex neurons. You could take polar opposite individuals and look at any one of their neurons to see why they think like they do. You would see nothing at all to determine if they were left thinking or right thinking. The neurons are apparently unrelated to the higher functions – yet they are the essential mechanism.

        We are to the internet as neurons are to an individual. Once we get to that point – and that is probably about now – the elite minority of the past will have effectively been replaced. The Metamind of the internet is in a different phase space to the individual – just like the neuron is unconnected to the individual mind.

        Many of our ideas are based on the flawed notion of control. We think we can control complex systems, when in fact complex systems exist in an orthogonal phase space with no known control vectors.

      • What about a single transferrable vote for EVERY piece of legislation?

        Joe Citizen can choose to vote yes or no on a piece of legislation, or they can choose to delegate their vote to another voter. Joe Citizen can also choose to set their voting preferences such that their vote is delegated to the fellow voter of their choice by default, and only changed if initiated.

        This would be a hybrid of elective and direct democracy, hopefully taking the strengths and eliminating the weaknesses of both.

      • At a local level it might be a proposed roundabout or services at a hospital and assigning land to an affordable housing project. At state level bigger proposals etc. Federally , bigger again.

        Top 20 ( by signatures) go onto ballot ( minimum percentage required to then be acted upon), MP’s ( councillors etc) would then be required to allocate available resources ( outside of basic govt running costs, unless this itself is being voted on) based on % won.

        Of course giving power to people that don’t make you jealous, then sitting back waiting for them to implement policies that benefit you more than others might be working for you.

        Or what Jason just said!. ( can someone explain it to me)

      • Jason there are thousands of pieces of Legislation, the voter would quickly tire of being poked on the minutiae of every policy.

        I’d prefer non compulsory voting. Weed out the disinterested, the disgruntled and the I Don’t Knows.

      • 3d1k, perhaps a min earnings per year required to qualify for vote could keep the libs in?.

        Perhaps Jason’s idea could have a % ( of state, nation etc.) required to pass ( in set time period)?.

      • migtronixMEMBER

        Jason there are thousands of pieces of Legislation, the voter would quickly tire of being poked on the minutiae of every policy.

        Or maybe we’d put an end to these “thousands of pieces of legislation” 3d? Why do these people need to dream up that many pieces of legislation — especially if its so boring no one cares…..

        Personally I’d be pretty happy if there was a “NONE OF THE ABOVE” option on the ballot — that would see control come back to you at least…

      • 3d that issue is dealt with through the delegation. Joe (or Bazza) Citizen can choose to delegate their vote to ANYONE of their choosing, someone they know and someone they trust. They could delegate their vote to a family nember or a friend that they know and believe to be someone of good morals who is also smart and interested in policy makin or has some expertise in the area.

        They could choose to vote themselves on specific legislation, or they could choose to delegate their vote on legislation X to person Y and their vote on legislation Z to person Q. Or they could choose to delegate their vote by default to a person they know for all policy and then only take their vote on policies they are directly interested in.

        Advantages of this system could allow a lot of policy expertise to come to the fore. People may wish to delegate their vote on health matters to doctors, infrastructure to economists and engineers.

        This is anathema to the current system where the public are forced to delegate their vote to someone they don’t really know who has been preselected by a handful of insider powerbrokers. It is a combination of direct democracy and elective democracy. It is elective democracy that is not beholden to parties or factional brawls.

        Of course my proposal, being truly democratic, would be horrifying to any member of the elite or those insiders because it would dilute their power.

        The communications infrastructure and associated technology is there to make this feasible.

      • To clarify a point of apparent confusion, Democracy does not require the People to vote on every piece of legislation.

        Even in the world’s most active Democracy, the Swiss Parliament still does almost all the legislating and the Swiss Cabinet all the administration.

        The essence of Democracy is that the People may choose the form of government they prefer. It may have elements of representation and delegation as well as direct voting.

        The important point is that the People have the ability to override the politicians where necessary. Otherwise – if the politicians have a Monopoly on Power – the system will tend to “adversely select” megalomaniacs who pursue their own private schemes and destroy society and the economy in the process.

      • Stephen Morris
        The Katter Party likely to hold the keys up here. You should be having words in their ears about electoral reform as a condition for their votes.

      • Jason there are thousands of pieces of Legislation, the voter would quickly tire of being poked on the minutiae of every policy.

        Most politicians know nothing of the legislation they pass, because they blindly vote with the party, which is itself a key part of the problem.

        A vote on legislation in parliament should include 5-10 random questions about its key aspects as part of the process. A failure to answer any of those questions correctly would automatically render the MP’s vote as a “nay”. Additionally, all legislation should include a sunset clause.

    • Abbott just now:

      “He has been a good Premier, who led a good government.”

      The lesson is “not to give up on reform, but to make sure that everything you propose is fully explained and well justified.

      “Obviously that’s a lesson that we are determined to learn in Canberra as well.”

      There’s Strayas articulate democracy. Right there.

      The man’s suffering from shock, to be fair.

      Tata Abbott

      • Abbott….”well justified”

        Therein lies the problem for the LNP

        Their policies ARE well understood – It’s just that they are perceived to be unfair and NOT well justified.

        Spending $millions “selling” these policies is not going to change the mood of the electorate.

        ONLY a change in ideology could turn the mood – a change in leader is not enough.

        If they don’t get that they are doomed.

        AND then unless the ALP understand that we require major policy change then Australia is doomed.

      • Lenore Taylor put it succinctly:

        “Newman seemed to think Queenslanders would come around if he just said the word “strong” lots of times. The Abbott government seems to have the same expectations of the phrases “debt and deficit disaster” and “cleaning up Labor’s mess”. But those phrases do not substitute for clear explanations about why the federal government thinks its chosen spending cuts are the best and fairest ways to improve the budget bottom line.”

        Usually when pressed, Ministers fail to adequately explain why they are following a particular course of action and quickly revert to three word slogans. I don’t think Abbott has the ability to create a narrative let alone create one now when all the nation wants is to see the ass end of him.

        “Tony Abbott is making exactly the same mistakes Campbell Newman did”


    • Disagree. If Newman could have stopped himself from meddling with the judiciary and CMC, avoided a couple of key contentious development approvals, appeared slightly less contemptuous, called the election just two months later, I seriously doubt the ALP would have come this close. I agree with Stephen Morris, these weren’t tough decisions being rebuked, they were stupid decisions.

      • Yes. Of course. If Newman wasn’t Newman you mean, and the LNP wasn’t the LNP, different decisions could have been made (see above) and the calamitous result could have been avoided.

        Totally agree.

      • Well, yes – but there have been wiser conservative governments and leaders in this country who knew which fights to pick. All I am saying is this had nothing to do with Queenslanders being unprepared to stomach so-called “Tough” decisions.

      • interested party

        Newman inherited an absolute dogs breakfast regarding state finances……and as he is liberal….not some politician from Switzerland, he had to stick with the libs program. You can argue about the ideology and the failures from that angle all you want and call tough decisions stupid…..that is a whole different argument. To follow the party line, and to attempt to put Qld back on some sort of stable fiscal footing was his job….and he was voted in on that knowledge. How he went about achieving that process is where he fell over……libs=oligarchs…and all that. My Op was more leaning on the financial side of the political problem…not so much as his foolish calls on CMC/Judiciary…..just deserts he got on those.
        BTW, I didn’t vote for Libs in that or this election. They disgust me….in fact, all politicians do that to me.

        I want a political system that revolves around the same ideals of jury duty. We need reluctant, fixed term,one time, public membership in Canberra…..not career con-artists.

    • “…the moment when Eurogroup chief Jeroen Dijsselbloem (he of the “template” foot in mouth disease) stood up at the end of the EU-Greece press conference, awkwardly shook hands with Greece’s new finance minister, and whispered…”you have just killed the Troika,” to which Varoufakis responded… “wow!”

      Varoufakis speaks plainly. Calmly. With his cards on the table. He is not from the political establishment or from the gigantic gene-pool of sycophants orbiting it.

      He is an absolute shock.

      Because of this the banker/lawyer neoliberal plutocrats stand dumbfounded in his presence. They look visibly naked and exposed to the world.

      Make no mistake. This is tectonic.

      The Greeks will probably build statues to Varoufakis.

  21. This page formatting is messed up in Firefox and MSIE, but okay in Chrome.

    I suspect the pic of Hitler by Gunna is doing it. Delete it and see if it helps

  22. Can anyone tell me the simplest way to invest in/buy foreign bonds (unhedged)?

    Im a very primitive investor, I couldnt find any ETFs/managed funds etc

    • migtronixMEMBER

      Doubt you’ll have much luck there Coming, they’re the kind of things Hedge Funds/Superannuation/ Insurance/ Banks buy up.

    • Unhedged international bond funds are pretty rare. Not sure they exist at all in this country at the retail level. You shouldn’t constrain your currency bet to the asset, anyway.

      • thanks guys,
        that’s unfortunate – they would seem like a good investment if we have ongoing deflation.

        What do you mean by “constrain currency bet to asset” kr? what would you suggest the best way to make the currency bet is?

      • migtronixMEMBER

        I know what Ritual meant and was going to say the same myself. Basically holding a government bond is an effective bet on that currency. Much better ways to trade currency moves than holding bonds…

      • Why do you say that? And what would you suggest is a better way?

        bonds at least give a (small) dividend

        holding currency in a trading account gives no income.

        Are the transaction/holding costs much higher for bonds?

        Besides, it would seem to me if AUD is going down, then bond yields everywhere are going down, so its kind of an all-in bet

        Would be interested to hear your thoughts

      • migtronixMEMBER

        Speaking for myself only (not Ritual) — sovereign bonds are the ultimate collateral that “currency” is backed by, so whereas I see what you’re getting at, and indeed yields in the future will be lower, but since its basically a currency move being played out via IR fiddling — you’re better off figuring out the strategy of the currency move – which you can liquidate much more easily – than holding a negative yielding note…

  23. Funnest post election headline I’ve read yet “Turnbull backs PM” – Sky news

    Skippy… is that like the opposite of fronting or like yeah mate I’m back here…. way back here… following at some distance….

  24. Hi All

    Haven’t been on the site for a few days and don’t think anyone else has posted this up yet. This is a proposed resolution that was submitted to US Congress about a week ago


    US Congress House Resolution 41

    Whereas the Federal Government is operating at an annual deficit and is increasing its outstanding debt every year;

    Whereas the Federal Government, as of January 2015, is carrying more than $18.0 trillion in debt, of which $13.0 trillion is owed to the public and $5.08 trillion is owed to Social Security and other trust funds;

    Whereas the Federal Government borrowed 14 cents for every dollar it spent in 2014;

    Whereas foreign governments, individuals, and corporations as of October 2014 own 47 percent of Federal debt held by the public;

    Whereas Social Security’s unfunded liabilities in 2014 are $10.6 trillion over 75 years and $24.9 trillion over the in-finite horizon;

    Whereas the Federal debt held by the public is expected to increase by more than $7 trillion from 2014 to 2024 according to the Congressional Budget Office;

    Whereas State and local governments are heavily dependent on Federal revenues;

    Whereas more than 16 percent of the entire Federal budget goes directly to States and local governments;

    Whereas more than 22 percent of total State and local government general revenue comes from the Federal Government according to Census Bureau’s latest Annual Survey of State and Local Government Finance;

    Whereas numerous State and local government employee pension plans have offered overly generous retirement benefits to its employees and are in dire financial situations with combined unfunded liabilities of more than $4 trillion;

    Whereas many State and local government pension plans have understated liabilities and overstated asset growth rates and have employed methodologies that private sector plans are prohibited from using by Federal law;


    Whereas several State and local pension plans are expected to fully exhaust their funds within ten years:

    Now, therefore be it resolved That it is the sense of the House of Representatives that

    (1) the Federal Government should not bailout State and local government employee pension plans and other post-employment benefit plans;


    (2) State and local governments should immediately institute reforms to their employee pension plans, including replacing defined benefit plans with defined contribution plans.

    • More here

      Congress may have bailed out Wall Street and the auto industry, but it’s apparently in no mood to bail out retirees at risk of losing their pensions.

      After a flurry of last-minute, behind-the-scenes maneuvering, lawmakers Thursday finalized a deal to shore up the government’s pension insurance fund by raising premiums and allowing troubled pension plans covering more than one employer to cut retiree benefits.


      It is a reality that most pension funds and super schemes for employees are at real risk in the event of financial calamity.

      • Of course they don’t want to bail out retirees, that money will be needed to bail out Wally St again.

  25. Ben Eltham brings up three good points about the quirks of the QLD electoral system that would have played a part in yesterday’s result:

    “Why does Queensland swing so hard? In part, the tendency is due to the state’s relatively homogenous electoral geography. Although a highly regional state with many provincial cities, the state’s south-east is an almost uninterrupted mortgage belt of middle class voters. There are fewer blue ribbon strongholds and safe Labor seats – instead, even supposedly safe seats can remain in play with margins of eight, ten and twelve per cent.

    Queensland also lacks an upper house. Many observers have lamented the lack of a second chamber in terms of checking the power of the executive, but it also plays a role in electoral psychology. Voters can’t hedge their bets with different votes in the upper and lower house: instead they get just a single vote to cast where they see fit. When a mood for change takes hold, it can prove decisive.

    Finally, Queensland’s voting rules allow optional preferential voting. This means many voters “just vote 1”, placing only a single preference on their ballot papers. This allows voters to register their approval or disdain in an unadulterated expression of democratic preference.”

    From: https://newmatilda.com/2015/02/01/hero-zero-queensland-turfs-out-campbell-newman



    THE MARCH FOR HOMES brings together campaigners, tenants and trade unionists to demand building of council homes and curbing of private rents … read more and watch video via hyperlink above …



    Demographia Survey Media Reporting & Commentary Search


  27. China factory sector jolts by shrinking in January

    “China’s factory sector unexpectedly shrank for the first time in nearly 2-1/2 years in January and firms see more gloom ahead, an official survey showed, raising expectations that policymakers will take more action to forestall a sharper slowdown.

    The official Purchasing Managers’ Index (PMI) fell to 49.8 in January, the National Bureau of Statistics said on Sunday, a low last seen in September 2012 and a whisker below the 50-point level that separates growth from contraction on a monthly basis.”


    • Nice article. This concept also dovetails nicely with Minsky’s Financial Instability Hypothesis – Stability Is Destabilizing.

      I expect a rejoinder from our friendly neighbourhood mortgage broker, PF, on why they are are all wrong and how Australia is different.