Weekend Links, February 28 – March 1, 2015

Golf at Yas Greece Med Travel



United States



United Kingdom

Terra Incognita


Capital markets

Economics, Markets and Central Banks

Global Macro

 And furthermore

Ritualised Forms
Latest posts by Ritualised Forms (see all)


  1. China Cut Its Coal Use 2.9 Percent Last Year, Will They Peak Even Before 2020?

    As we reported last year, the Chinese government announced in November it would cap coal use by 2020. The new data raise the possibility the peak in coal consumption will come even sooner.

    This reversal on coal utterly refutes the GOP claim that China’s recent climate pledge with the United States “requires the Chinese to do nothing at all for 16 years.”

    India’s Air Pollution Is Cutting 3 Years Off The Lives Of Its Residents

    99.5 percent of India’s population lives in regions with higher air pollution than the World Health Organization’s air pollution recommendations. A study last year found that air pollution in India — specifically black carbon and ground-level ozone — was cutting yields for wheat and rice crops nearly in half. And a World Health Organization report from last year found that 13 out of the 20 most polluted cities on earth are in India, with Dehli, the country’s capitol, coming in at the most polluted in the world.

    • You wanna know why Mig was banned? Its idiotic comments like this 10,000 times a day…

      mektronik ‏@mektronik 11m11 minutes ago Melbourne, Victoria

      Bwaaahaaahaahaa!!! Scotch tape (R3M/no long-term solution) thinks it’s the air killing Indians. Water? Idiot!

      These tweets just serve to remind the blog owners why he was banned and justify their decision. No doubt he was given several warnings.

      • And now idiots like you and R2M are off the leash.
        What a joke.

        What you are looking at is the commercial end of this site, which is a shame as Mig provided a good mirror. WW

      • Can we keep this nice please. Mig’s a product of a very unhappy childhood. Saddening. Insensitive/hyper-sensitive, erratic/focussed, scattergun/incisive. But he made choices, often poor ones. We all do. I chose not to engage.

        That Abe unemployment article. All that dismal household spending is yet to show up. Demographics has got them by the gonads.

      • Demographics has got them by the gonads.

        Isn’t that the same for all developed nations, where most of the populations are aging?

      • WW, Mig could have made (and possibly still will) a positive contribution to the site, but he was a repeat offender at picking fights with pretty much everyone, and posted at least 5x as often as any other member.

        As I said, he was undoubtedly given plenty of warnings to moderate his behavior.

      • No more Mig? Shows I’ve been out of touch lately.

        BTW Yesterday’s cricket turned out to be much closer than one would have predicted after the Aus collapse.

  2. This is what $1.2M gets you in Houston:


    Cantera imported columns, Travertine floors, etc..(See photos in link)

    ..and this is what you get for the same money (not accounting for exchange rate) in North Turramurra


    A lousy 3bd townhouse

    This is what we call the “wealth effect”. We are the dumbest people on this planet.

    • How odd to see my home neighborhood on here.

      FYI that Houston house would have sold for $500k ten years ago.

      Don’t forget the Houston house comes with a $20k yr Property tax bill.

      • Yes, that property tax bill is probably one reason why Houston remains much more affordable than other US cities. Instead of paying state income tax (like most other states), you pay this land tax which is much more equitable (in my opinion). This tax is used to pay for schools, roads, police, fire dept etc.. Therefore, it reflects the value it provides to the community and it varies per neighborhood.

        I’m sure if we had something similar here in Australia, we wouldn’t be in the situation we’re in now. There would be may fewer rent seekers for sure.

      • @2big2fail

        land tax which is much more equitable (in my opinion)

        I don’t think this is matter of opinion, it’s quite easy to calculate:

        Av average texan family makes $60 pa, owns $150k house and pays $3000 in property tax = that equals to 5% of income

        a wealthy texan who makes $10m a year, owns $5m house and pays $100k in property tax = 1% of income – very “un-equatable”

        BTW. $5m buys you a some of the most expensive homes in texas – a castle in G W H Bush neighborhood
        $10m a year makes you “poor” among wealthy texans

      • a wealthy texan who makes $10m a year, owns $5m house and pays $100k in property tax = 1% of income – very “un-equatable”

        I doubt there are many Texans earning that kind of money who only have a single house.

      • @drsmithy

        you are right, but it’s also true that there very few of them who have another “city” house in the same state. Property tax on land and houses outside of towns and cities is significantly lower. Rich people have other houses but usually in other states or countries.

        It’s well know fact that rich people have significantly lower percentage of wealth in real estate compared to average people, this is especially the case in USA and with super-rich.

        Super-rich in Texas like Waltons or Dell earn annually 10 or even 100 times more than their RE wealth in Taxas, while ordinary people earn third or fifth.

      • Oops… wrong wage link for Texas.


        Occupational Area Typical Hourly Wage

        Management $42.43
        Business and Financial Operations $28.52
        Computer and Mathematical $35.38
        Architecture and Engineering $34.34
        Life, Physical and social Science $26.30
        Community and Social Services $18.97
        Legal $32.67
        Education, Training and Library $22.81
        Arts, Design, Entertainment, Sports and Media $19.04
        Healthcare Practitioner and Technical $26.56
        Healthcare Support $10.44
        Protective Service $16.90
        Food Preparation and Serving Related $8.49
        Building and Grounds Cleaning and maintenance $9.38
        Personal care and Services $8.71
        Sales and Related $11.08
        Office and Administrative Support $14.09
        Farming, Fishing and Forestry $9.53
        Construction and Extraction $15.35
        Installation, Maintenance and Repair $17.66
        Production $13.54
        Transportation and Material Moving $12.83

        Starting at Healthcare Support Wages that are below the living wage for one adult supporting one child are marked in red.

        Skippy… tho cheap housing should fix everything up.

    • $1.2M in Houston also gets you a $45,000 tax bill every year for the rest of your life, which makes it a very expensive home.
      Live in it for 50 years and the total cost is $3.45M

      • @PF

        As per 2big2fails comment above, the land tax is also a replacement for state tax. So what you are saying is not quite correct.

      • But there is no state tax in Texas, offsetting it somewhat. (oops, edit conflict with flyingfox who posted the same info above)

        Property taxes in Texas range from 2.4 to 4% depending on area, school district, county etc. So on a $1.2M house, will range from $29k to $48k.

      • doctorx,
        Don’t follow your logic. The property tax is driven primarily by your property value and pay for things like public schools, streets, police, services, etc.. Why should someone on high income pay more for these services? Don’t forget that people pay federal tax on their income.

        Peter Fraser,
        That’s not true. If you’re over 65, you get significant exemptions which reduce your property taxes. Most retirees do not move out of Texas due to property tax. Also, keep in mind, this $1.2M house is not the norm. Houston median house price is $180K. Also, you get a deduction for the property taxes on your federal tax return.

      • Funny but the average person doesn’t pay any state taxes in Australia either.

        A reduction over aged 65 – whoopee.

      • Funny but the average person doesn’t pay any state taxes in Australia either.

        Yes, but federal tax in the US is not nearly as high as Australia’s federal tax. So not paying state tax in the US means you are paying much less income tax, excluding other taxes, than here.

      • “Funny but the average person doesn’t pay any state taxes in Australia either.”

        The average person here can no longer afford a house mate. He’s living with his parents and waiting for the inheritance.

        Median house price Houston: $180K
        Median house price in Sydney $1M

        If you have an idea how to fix this, we’re listening..
        I’m not proposing any radical or new ideas. This has been recommended by experts over and over. The problem is that people want to keep the status quo even though they’re heading for a crash landing and our policy makers are incompetent and self serving. What’s stopping us from implementing this:

      • What our esteemed colleague fails to also mention is that the cost of equivalent housing is Houston is a fraction of what it is here and they don’t pay stamp duty as far as I am aware.

      • Fox its cheaper because so many live near or below the poverty line.

        “Like America, there’s more than one Texas.

        The state is home to at least 40 billionaires and 50 Fortune 500 companies, and signs of great wealth are everywhere. Yet Texas also ranks among the worst states for poverty, minimum-wage jobs and the uninsured.

        If there’s going to be a debate over income inequality, put Texas in the middle of it.

        In addition to having a lot of rich and poor, the state has been a jobs machine. Since 1990, the job growth rate has outstripped the nation’s by more than 2-to-1.

        Over the same time, income inequality has been rising steadily. That tracks a trend in the United States and many developing countries, but income inequality is less painful in a booming economy.

        Texans earning at least $116,500 in 2011 made up 10 percent of tax filers but took home almost 50 percent of the income. In the 1970s, the top 10 percent accounted for one-third of income, according to data from economist Mark Frank.

        The top 1 percent, whose income starts at $414,500, hauled in almost 21 percent of Texas’ total income in 2011. Its share was half that size in the ’70s, Frank said.

        Texas ranks No. 5 for income inequality. Other measures, such as the Gini index, put Texas among the top 10.

        But there isn’t much complaining here, unlike on the national level.

        “Many people are willing to live with income inequality if they believe they have a chance to better themselves,” said Frank, who teaches at Sam Houston State University in Huntsville.

        Declining mobility

        That’s a big if. There’s evidence that mobility has declined. Children of the affluent are likely to stay near the top, while low-income kids face long odds of moving up the economic ladder, a study reported last summer.

        In Dallas, just 6.4 percent of children starting in the bottom fifth of income managed to rise to the top fifth, according to researchers on the Equality of Opportunity Project. They looked at kids born in 1980-81 and their incomes when they were about 30 years old.”


        Skippy… its a perfict example of neoliberal economics.

      • @2big2fail

        Someone making big money does that thanks to the political and socioeconomic system in which he lives. That system clearly favours some people at the expense of the others so if rich people were smart and not as greedy they would pay as much as needed to preserve the system that enables them to exploit others.

        Unless you think a person making 100 times more than average earns that because he/she works 800 hours a day or it has IQ of 10000 (or some combination that gives 100 times). And remember 100 times average is not very much for rich class. Last year Bill Gates was making $43000 (US average wage) every minute he was awake, clearly not earned by hard work or hard thinking. You think that is good enough reason to preserve the system.

        Poor people cannot lose much is system collapses, why would they pay. Middle class cal lose something but as nearly as much as rich.

  3. Michael West scores again in The Age on Profit Shifting.

    Joe is not only the Minister for Unfair Budgets but also the Minister for Corporate Tax Avoidance. Let’s hope he is on the joint removal ticket with Tony.

    • West is a light in the fog. Even when in a lesser role at News. Entertaining back then too. He had a rumour-whispering greyhound.

  4. After Indonesia retreat, GM retrenches in Thailand, too


    The above supports my theory, that GM and other corporations are repatriating production to the US for reasons other that purely commercial ones.

    I have long suspected a carrot and stick being used by US administration, perhaps an unwritten clause in the bail out terms or conditions on getting a slice of the defense ‘pork’.

    Whatever the truth, a high AUD and local wages are only part of the reason for loosing our auto industry.

    Makes me doubly suspicious of the the ‘free trade’ being negotiated.

    • One step at a time coolnik, after the budget disaster the punters are in no mood for surprises and the level of distrust is alarming. Too much of a good thing might backfire then nothing will happen.

      It’s good to see the Treasury Secretary essentially bury Hockey and the Liberal “debt and deficit disaster” shrills. Bet Hockey had a nice little chat with Fraser when this story broke.

      The last line was interesting:

      “Treasurer Joe Hockey this week said proposals such as one from the Greens to change the tax rates on super contributions to reflect income would be considered in the tax white paper process.”

      So Hockey is now willing to have the review look at the Greens proposal after shit canning it earlier in the week. Just as well he wont be around when the recommendation is made to consider the proposal.

      • Not sure that “one step at a time” is the way to go Wing Nut.

        Our pollies have form in only going part of the distance and then stopping. It wouldn’t be difficult to tinker with super based on a populist low vs high income argument that doesn’t address the real issues of inequity in this country.

        Then they sit back and watch as the genuinely wealthy flip further from super to property and pump that bubble even higher.

        What is needed is a balanced package of reforms.

        Perhaps a decision should be made on the amount of savings required, and then have someone other than politicians and their conflicted stooges decide how it is done.

        Plenty of good ideas have been aired here at MB. There are also plenty of smart people in government, treasury, RBA, etc (notwithstanding the gumbies). They are capable of, and in many cases no doubt privately do, understand what is best for the future of the country.

        It just doesn’t suit them to push for those things. I don’t get to be that negligent or lacking in duty of care in my job. The only reason they DO is because everything is driven by the politics.

        That is, the greed and ideologies of a small band of hand-shaking, silver-tongued, out-of-touch salesmen.

      • “What is needed is a balanced package of reforms” and that’s pretty much what Hockey said about the last budget, and in the process, scorched any hope of a politician ever being able to engage the public on the need to reform reform. To get the public back on side, thing have to be taken slowly, the public have no trust in politicians. What you’ve said Slambo makes sense but you’re not dealing with rational human beings.

      • Notwithstanding that Hockey’s was a pretty crap package that he would’ve had trouble selling to a fence post, the pragmatist in me knows you’re right Wing Nut.

        Some change is better than none. I just hope it doesn’t stop there.

      • You can safely assume super would have been part of the myriad considerations in the White Paper.

        Greens, which demonstrated no interest in implementing substantive policy measures whilst in Governemnt with Gillard, now starategically release policy immediately prior to official White Paper.

        Headline grabbers, not serious policy makers.

      • drsmithyMEMBER

        Greens, which demonstrated no interest in implementing substantive policy measures whilst in Governemnt with Gillard, now starategically release policy immediately prior to official White Paper.

        Yes, they did. You just didn’t like any of their policies.

        Much like now.

        Slipping, minebot, your dishonesty is meant to be more subtle.

    • Yes, a 20% rise followed by a 10% fall. Looks like he’s contradicting PF by saying credit growth is strong.

      • Looks like he’s contradicting PF by saying credit growth is strong.

        PF is a card carrying (more like badge carrying) member of the property forum and it’s his livelihood. Who would you believe?

      • Credit issuance is very strong, but growth of aggregate household credit is not.

        Sorry you guys aren’t able to understand that, but it has little to do with any bias, it’s fact

      • Wouldn’t have anything to do with that stratospherically high base then would it Pete? That must make it OK!

      • Jimbo I was explaining a point, what you believe is right or wrong from a moral standpoint is irrelevant.

    • Thanks for posting BB

      Edit: Particularly pleasing hear a balanced discussion of interest rate levels

  5. Would you all just stop it!

    Unhappy childhood? Yes 100% correct. Let me put it this way, I was once incarcerated in my room for 3 months and had to knock to be escorted to the toilet. For 3 months!! I was like 11. But that’s all by the by and not germane to any of this.

    Lev is right, I need a holiday. Desperately. Maybe I’ll come back after that, when ever that is…

    H’n’H sin-bined me for a day but no I had no warning, in fact I didn’t even know until yesterday when I saw his email from Tues or whatever. No matter.

    For all your constant pontifications I believe I’m one of the very few people around here who actually obliges to reasonable requests, I’ve done on FX posts, I’ve done it on “toning down”, I’ve done it on 10 k posts/day — but its never enough for some of you.

    Sayonara b#tchez see in the twitterverse.

    Oh and Wilb, yeah dude I’m keeping tabs on the ASX close action!!

    • Glad to see you back. Sometimes the number of posts annoyed me, but I figured your probably more intelligent than most. i guess at the end of the day we are all similar here, surrounded by a sea of bullshit in the financial and political matrix we live in. Let’s hope there is away out 🙂

      • Don’t want to buy into the Miggins kerfuffle too much. Like a rowdy child – irritating yet you miss em when theyre no loger around. Hope he comes back in a somewhat reduced form

    • The Traveling Wilbur

      Wilb says: sounds like you’re right mate – a break sounds like a good idea. Have a good week or two off (and a day or two off from Twitface wouldn’t hurt either) and see you back here bright-eyed and and bushy-tailed then, if not sooner. In the mean time, do some m, avoid the c/h/i/a and moderate the alc and we’ll all be better for it when you get back. ; ). As incentive, think how strung out Lorax will be by then – it’s amazing that he’s lasted this long without you!!

      Keep calm and carry on.

      • Dear Mig

        Sometimes you appear so angry and can’t keep a lid on your despair.

        That is not fun to watch, you are one of the brightest stars on this blog, but mate the trolls can push your buttons ….. perfectly.

        Life is not (or shouldn’t be) ‘either or’, find a reliable person to vent your anger ‘through’ and save your great intellect for the important issues here.

        Good luck and best wishes.

    • Gunna, now you can understand why Mr Putin had a close military escort standing by when he visited here. The Donesk airport is telling, what is the path from here.

      • Doc X, ah the press, remember the only (public) war which has gone well recently was the Falklands war, from which the press were excluded.

        Now if only we can remove the press from ISIS and politics. WW

    • There is nothing about the Ukraine that gives me a good feeling. I don’t know the specifics like some, but from a distance you can see that someone is looking for conflict and this is going to escalate. The responsible party(s) I guess depend on your point of view, but the end result looks the same… War in Europe and states being dragged in, then from there who knows?

      • it’s going to be the worst war since Vietnam.

        in just a year both sides will look back and think how unconditional surrender at todays’ day would be much better option than continuation of war. Unfortunately, media is there to make people think continuing their “just war” is the only way forward.

    • That’s a very public place. Is that a message from the Russian State to opponents, a western intelligence agency false flag execution, novorussians? Just seems odd, surely if you want to get rid of somone “suicide” , “single vehicle accident” will do the job with less questions asked. This appears to be done for effect…

    • I will write something up later in the day. I have just been speaking with people in Moscow and there is a fair sense of shock and a strong sense of ‘This is the administration’

      • One of the problems facing analysis of this and similar issues world wide is the extent of US , UK etc involvement in domestic politics.

        For example, Putin has watch what US has ‘achieved’ in terms of regime change in several sovereign states recently.

        A logical counter to this would be to centralize power. So on just this one point we have both chicken and egg arguments and also with whom the responsibility lies.

        I am supporting Putin for the preservation of peace.

    • The Message of the Nemtsov Killing and the Killing of the Nemtsov Message

      Boris Nemtsov was an overt critic of the Putin administration, both for corruption and its recentralization of power, over the entire Putin era, and more recently for Russia’s involvement in Eastern Ukraine (blame for which he laid at the feet of Putin). He was a political and social figure and his killing is significant for a range of reasons. Within a short period of news of the slaying on the Bolshoy Moskvoretsky Bridge, within a few hundred metres of the Kremlin Red Square and St Basil’s Russian President Vladimir Putin had condemned the murder and offered condolences, and taken the investigation of the killing under his personal authority. No matter how that investigation proceeds and what it uncovers, as well as when, it will need to be handled very carefully.

      This time it’s different

      The difference between the killing of Nemtsov and the numerous other high profile killings in Russia over the last say 15 years or so is that it is an overtly political killing, with no other ostensible explanation whatsoever, and in this regard differs from the murders of Anna Politkovskaya, Andrei Kozlov, Sergei Magnitsky, Alexander Litvinenko or Paul Khlebnikov, which have attracted international attention, and a host of lesser known murders of journalists, financial figures, and judges over the same period. Politkovsksya was an investigative journalist who no doubt had uncovered things unpleasant for the Putin regime but had equally uncovered plenty to make various criminal figures unhappy. Andrei Kozlov, the central banker who was gunned down in 20076 was in the process of closing down dodgy banks, and had obviously traced the links back to someone with the money to have him knocked off, Alexander Litvinenko was obviously a part of the murky world inhabited by security and the oligarchs, and Paul Khlebnikov had pissed off plenty of people in his looks at the origins of the wealth of many ‘elite’ Russians in the immediate post-Yeltsin era. The rest were essentially just day to day criminal activity on the streets of Moscow (where these things happen) or were jailors not giving a damn about those in their jails (Magnitsky) – possibly under direction from above, but not so obviously so that you could discount day to day administrative brutality.

      Nemtsov is different. He had called for a protest march this coming Sunday, he had maintained contact with the Ukraine government, and argued that the Putin government had pushed its own interests in inflaming the war in Eastern Ukraine. A genuine ‘liberal’ in the Russian sense of the word (he pushed for freer markets and a more accountable state and bureaucracy for two decades, in and out of the Russian duma and including a stint as Deputy Premier under Yeltsin, who was believed to see him as a protégé) he was also acutely aware that the advent of market capitalism in Russia had created an oligarchy, which had fit hand in glove with an long standing national predilection for corruption, and had congealed into the Putin regime, from which it showed no sign of evolving any further. He also understood that imposing sanctions on Russian institutions and individuals while welcoming the beneficiaries of corruption into international capital markets, was setting the western world and Russia onto an endless loop in their relations. He regularly appeared in the Russian press and regularly criticised what was unfolding around him, in a nuanced and perceptive manner which may not have made him as popular as other Russian opposition identities, but was arguably more likely to unsettle those in power. The only advantage to having him whacked is a domestic political advantage, and that advantage set against the backdrop of him being a reasonably marginal figure in a political policy sense, against the widespread perception (rightly so for mine) of Russian liberals as being the living refrain of chaotic incompetence of the 1990s, fragmented beyond all plausible ability to produce effective government, and often carrying corruption issues of their own. For mine it isn’t a killing to shape national policy, it is a killing to make a point about Russian politics, and although it is only a couple of hours ago this is what makes it a definitive point in the Putin era.

      Russia’s monolithic power vertical

      Moscow is the sort of place where, once you are there, you tend to assume that there is a big monolithic ‘regime’ controlling everything occurring around you. It is only after you are there for a while that you start to twig to the idea that there are groups within that monolith, and that the pro-Putin crowd, whilst certainly the biggest and most powerful of those groupings, is not the only one.

      The groups tend to represent obviously interests and desire for power, but often have functional groupings (eg interior or foreign ministry, transport or energy groups) or business interests (various industry and industrial holdings/conglomerates) and some regional interests. In almost any of them you will find fairly hard core atavistic thugs of the type often portrayed in TV shows and the like about Russian criminals, but I would observe that in many of them you will also find perfectly decent ordinary intelligent individuals who would like to live in a world where there was administrative accountability and more overt justice, and a world which was more like what they often assume to be the world of Western Europe or (though less so) the United States. These types often find themselves in the situation of simply trying to make the best out of things that they can, with the power dynamic they are part of unable to afford the opportunity for them to change the system. Often that ultimately devolves down to making the best of the circumstances for their families or friends, and can evolve into the corruption that the individuals themselves have abhorred at some point along their journey. It is not a matter of one clique being ‘good’ and another ‘bad’ but rather that any given clique will involve elements of both, with those elements evolving and changing from issue to issue and circumstance to circumstance. The only constant would be the guy everyone calls boss.

      The other thing to bear in mind is that Moscow is a place where gunmen knock identities off, often in cold blood, and regularly appear to get away with it, more often than in other major global cities. Russia (though certainly not alone in this) is a nation with plenty of well-trained people who can organise and carry out a killing when they need to, plenty of people who would pay to use such a service, and an administration, legal system and media well versed in exploring, divining and debating motives, meanings, real and decoy facts, produced confessions and on and on and on. Like everything else in Russia, complexity is a given – even for the most straightforward of things. It will need to be to explain why it would be that in a part of Moscow generally festooned with police, not 500 metres from the Kremlin, and with an individual who would rightly assume he would be under a fair bit of surveillance, 2 days prior to him leading a protest rally, someone has driven up, fired seven shots, and driven off.

      Things done differently

      That sort of environment for the elites tends to make for some positively astounding processes and links accompanying almost any major project, or potential policy change, or, more particularly, the policy response to social and economic change, and over a long time in Russia, it is in the course of watching these evolve that you tend to get some sort of glimpse into who’s interests are untouchable at what point. I recall well the words of one of the first Russian banking types I ever spoke with who told me straight out, ‘Have a look out the window. Everything you see there will be broadly the same as the major cities of the rest of the world – the skyscrapers, the stations the roads and the cars, and the shops on the streets, and the people who buy things in them – but the way they get there is, here in Moscow, unlike anywhere else. To understand Russia, you need to have an understanding of that process. The people who are part of it, hear and see things which others don’t, their understanding of things happening in that world will be different to someone trying to make logic of it from outside that understanding.

      It’s about here that the open killing of Nemtsov comes in. It is a fairly straightforward message by someone for someone within that group of interests which influences decisions – and should be seen as such.

      Plausible, implausible and Russian investigations – the official

      The first assumption, which no doubt will fill many pages in the coming days, is that there was some sort of order from someone in authority to have him whacked. It may be eminently plausible, though anyone proposing it would have to ask what the advantage to the administration actually is. Nemtsov was an influential public figure amongst a distinct section of society in Moscow, but he wasn’t wielding policy power and wasn’t an oligarch with immense financial interests threatening someone. He was one of the more high profile Russians prepared to protest against an increasingly authoritarian (or should we call it security obsessed?) Russian state, and one that was prepared to stand in the face of VVPs surge in popularity following the annexation of Crimea, and (at the moment) seemingly reasonably successful involvement in the prosecution of military activities in Eastern Ukraine, as a face of an increasingly obdurate social movement questioning VVP’s administration, and a movement that can certainly be expected to become more substantial as the Presidential popularity recedes and the economic implications some decisions of his administration come home to roost with the Russian public.

      On the one hand you could say that he wasn’t popular enough to represent a genuine threat to VVP, but on the other you could also say that if you thought the threat his type of politics represented was likely to increase as a threat (and I don’t think the threat of his politics was ever likely to really test the Kremlin) then the time to pressure it would be before it became more overt as a political threat. Even then you would have to wonder, if someone has made the decision to have him killed, if that person would have thought he could become more influential, and greater risk, as a slain ideal than as a living political identity. That could happen.

      The general form guide from here would be rumours about officials having overstepped their mark overtly or covertly, actively or passively, in aiding or abetting, ignoring warnings of or awareness of facts about the lead up to the killing or those who were planning it, or maybe who will look the other way as those who have done it vanish from the scene. It could be plausible enough no matter what scenario was crafted around those themes. Maybe an investigation could go further to implicate a rogue element in the administration which for some reason was infuriated by something Nemtsov had done – and it should be remembered he was one of the few Russian identities critical of Russian involvement in Eastern Ukraine, as well as the nationality of the woman he was with at the time of his death, against a backdrop of the involvement in Eastern Ukraine and Crimea being very popular domestically – who have planned and carried out a whacking on some form of patriotic urge. Again it is plausible, but you would have to ask if it is going to help the international perception of the Putin administration right at the point where the Minsk II ceasefire in Eastern Ukraine sees a mild pause in the deterioration of its international profile. As always the rebuttal to this line of thought is that the Kremlin won’t care about international perceptions as long as it controls the agenda and levers in Russia. That too would be eminently plausible and the Russian state has never been slick in the PR game, but my gut feel would be that even the Kremlin wouldn’t want any more negative press than it already has at the moment.

      Plausible, implausible and Russian investigations – the provocation and the wildcard

      Of course the next port of inquiry will be the false flag slaying – the idea that someone opposed to Russia (wouldn’t necessarily need to be Ukrainian, but would be most credible if it was) had had Nemtsov killed to make Russia and Putin look bad. To provoke the Putin administration. Given events in Eastern Europe, and the involvement of the Americans and the reams of writings about the activities of envoys, ambassadors, vice president’s sons, neo-Nazis, Jews, the Israeli intelligence, and enough characters to craft a good James Bond script, you could suppose that none of them could be immediately excluded from calculations, though you would tend to think them more improbable. From there another regular red herring tossed into the milieu in these sorts of incidents is the genuine wildcard. Keep your eyes peeled for rumours, of generally far-fetched plausibility, he was sleeping with someone’s wife, had stolen money from someone, was a drug abuser who hadn’t paid his supplier in some time, or has been mistaken for someone else, or had become part of turmoil within Russia’s often zany ‘liberal’ set, or that the woman he was with had some sort of double life he was unaware of.

      An official investigation could no doubt drag up any of the above, and plausibly even populate a narrative with confessions, caught accomplices or even maybe a gunman. God only knows. One thing I feel confident about is that there will be some sort of investigation, plenty of intriguing headlines and presumably a good posse of interesting characters and plot twists. But none of that will go close to the implications of the murder. To get to that you need to think about the increasing isolation of Russia internationally, the direction the Russian economy is heading and the response to any type of criticism by the current Kremlin administration and VVP as President.

      Meanwhile back at the Kremlin

      The Russian state owns more than half the Russian economy, and courtesy of the national response to the 2008-2009 financial crisis, where it bankrolled oligarchs with cheap loans, is in a position to heavily influence that it doesn’t directly own, and that’s before you get to the authorities and courts (google Bashneft and Yevtushenkov). Russia’s reliance on energy revenues for the budget and current account has been noted since the late 1990s, but only in 2014 did it turn into a serious risk, and by that stage it was a risk that had in many ways been buffered by astute economic management (if not always astute enough) under Alexei Kudrin. That has brought some time to respond to the downturn in crude prices and the financial sanctions which have been imposed on corporate Russia since the annexation of Crimea, along with the collapse of the Ruble which has shaped (or bludgeoned) Russian spending towards domestic producers and away from imports, and enabled the state to continue running a budget surplus. The import substitution has provided a fillip of sorts for the Russian agriculture sector, and no doubt is lending impetus to calls to spend some of the budget on developing import competing sectors in manufacturing and some services. What that does now is enable a nation which has become increasingly isolated internationally to look at something resembling a degree of autarky – particularly given the feeble global demand environment – to support domestic demand (which any government would want to do) and to backstop its strategic capability position (which a government with Russia’s strategic concerns would want).

      At the same time the response to events in 2014 hasn’t been free from pain for ordinary Russians, and although the annexation of Crimea and confrontation with Ukraine have been popular, it could be expected that the popularity of the Putin administration would have to disenchant more as the economic straightjacket Russia finds itself in starts to tighten – even more so if crude doesn’t rebound. The logical outlet for that type of discontent would be the reprise of the pro-democracy marches of 2012-2013, only this time they would take place against a different backdrop. The state, which has been increasingly alert about the risk of interventions by foreign governments (particularly funding from NGO’s and or other sources from outside Russia pushing social protest inside Russia) in Russia for quite some time, and rise of any sort of protest movement is likely to be the rise of a willing recipient of funding from anywhere.

      The message in the whacking of Boris Nemtsov

      This is where the killing of Nemtsov comes in. He had the political background to be able to influence that protest movement into some form of political entity capable of unsettling the balance of powers currently making up the monolith, and potentially take it beyond the widely ridiculed miasma it currently is. Another logical frontman for this Sunday’s protest rally Alexei Navalny is currently doing a few weeks in jail so that prevents him from being the frontman for now.

      More strategically it is showing the powers that make up the monolith that being part of the monolith is a game for keeps and which imposes its own discipline. This shouldn’t be underestimated as it can be expected that as Russia’s economy deteriorates and the balance of powers making up the monolith deteriorates, it may occur to one of those powers to reach out to either the protest movement or possibly even the international world to seek to craft a narrative involving it being a part of whatever power structure may follow the current one (not that it is showing any sign of going anywhere anytime soon).

      That unanimity message will be quite important for the VVP administration to compare with the unfolding chaos in Kiev and Ukraine where a collection of oligarchs which deposed another collection of oligarchs about a year ago is showing every sign of coming apart at the seams. Any rise in, or continuation of (depending on how one sees things) of the chaos in Kiev will remind a Russian public (or have considerable potential to do so) that VVP to some extent has kept a lid on the oligarch set in Russia, and particularly the types of excesses which have been, and are continuing to be, visited on their Ukraine counterparts. Expect to see that refrain pushed in the Russian media (which isn’t to say it isn’t true and that the Kiev government is not every bit as corrupt and dismissive towards its own people as its predecessors were – though sadly that is not the message Russians will be seeing in the international press, which will reinforce the message of the Kremlin at home).

      More disturbingly though the killing of Boris Nemtsov has echoes in Russia’s past, in the purges which followed on from Stalin’s instigation of the murder of Sergey Kirov back in the 1930s, and the intense centralisation of Russian administrative power which followed. I would have thought that a generation of Russians which has become used to pretty easy access the rest of the world, if not the same types of democratic process found in the rest of the world, would be inclined to react strongly against any curtailment of their right to see whatever they like in their media, their rights to pretty much go wherever they like, and their right to think pretty much whatever they want. But a lot of ordinary Russians do strongly value ‘stability’ over democracy and will tolerate the former taking some heavy handed forms as long as it appears to be in control and delivers predictable outcomes.

      The murder of Boris Nemtsov should be seen as a message of that control and a warning to those who would upset the balance of Russian power, but also as a harbinger of the debate to come – be it whispered in small protest groups, or waved about on placards in noisy street demonstrations, or debated in the duma, or even through the media – that Russians can make their thoughts known to those who would lead them or they can’t, and of the costs either may entail.

      • Lots of speculation, not saying much you couldn’t work out for yourself just by thinking the situation through carefully.

        My own suspicion is that Nemtsov was increasingly in contact with the US, which is desperately seeking regime change in Russia, one way or another. The US is notorious for creating internal foment in countries by supporting opposition parties. No doubt the contact between Nemtsov and the CIA was monitored by Putin’s security police, and if it was them who killed him, they felt fully justified in doing so.

        • Well I didnt have the militsia report old coq, and one of the people who i called who lives very close by on Ordynka knew even less than I did from Reuters about the facts. After the basic facts it is all speculation – even in Moscow where the speculation is reaching frenzied levels.

          I doubt Nemtsov had anything whatsoever to do with the Americans, given that he had been a Russian political figure for more than 20 years, he would have been under no misunderstanding about what US contact would mean for the Putin/FSB crowd, and would have been acutely aware that disclosure of those contacts (if they existed) would discredit the movement he was trying to push. Anything American in Moscow is largely discredited. Sure he could be quite friendly and open for international journalists, and was certainly pushing a line which was in some ways pro US interests (to the extent he thought they coincided with Russian interests), but he had been an irritant for a long time and if he had stronger links I am sure they would have received an airing previously.

          I have no doubt the US would like a change in the Russian leadership’s behaviour, and may (in their wildest dreams) dream of a changed leadership. But as I have sort of alluded to before the problem is that the average man on the street sees anything proposed by the Americans as code for letting a batch of oligarchs carry on the way they did in the late 1990s – so they have to distinguish between whether they would like a new government which was in some way ‘democratic’ – and which would be highly likely to behave in ways similar to VVP and his crowd [which is very popular] – and whether they would like to push US strategic interests (less Russian government ownership of the state, less Russian control over Europe’s energy mix, more market capitalism in Russia etc) which would be likely to have some negative impacts for the Russian punter on the street and be likely fairly unpopular. Given that, what would they replace Putin and his crowd with? and how would they keep it in place? [given their record in Iraq, the creation of an IS type phenomena of profoundly pissed off people in Russia would have to be on the cards – and should be viewed with the utmost concern]

      • Appreciate the time & background knowledge that went into that. I am always looking for patterns and themes as you can sometimes be overwhelmed by specifics. I always looked at russia as a monolithic state, but this is obviously not true, perhaps this is always true even in a place like North K orea. There also appears to be a lot more ” fluidity” in Russia than appears on the surface, though as you point out it is constrained within and outside some of the power groupings.

        For my mind that word ” stability” is the key. I have heard that often in regard to Russia and it explains how they seem ” alien” to us at times. The trade off historically between an authoritarian state and predictability and or a more chaotic power structure. I use that word .” Alien” loosely because when you peel away the effect of our ” western” propaganda we are like the Russians more than we know. People that are prepared to allow growing authoritarianism as a trade off for material comfort I.e ” don,t rock the boat”.

        So if our oligarchs and state want to take on the Russians in an economic (now) or military conflict ( in the near future?) they Need to be careful. It seems they would be too arrogant to read the situation on the ” ground” properly and I would bet that if an extended conflict were to occur the ” ordinary” Russian will outlast any of us enduring hardship. It would be ironic that if the Western ” leaders” light a fire in Eastern Europe it is they that get burnt when the going gets tough.

      • I doubt Nemtsov had anything whatsoever to do with the Americans

        If that is so, then it would be the very first time ever that an opposition leader in a country in which the US seeks regime change has not gotten covert support from the US.

        Have you read “Confessions of an Economic Hit Man“?

        • Yeah I have, and I’ve personally interviewed a number of participants in the Russian privatisations of the 90s – and dont think there is any doubt that global institutions pushed the Russian government of the day to go longer and harder on privatising (to the detriment of the social fabric of Russia) than Russian politicians left alone would have done. And Nemtsov (a deputy Premier with Chubais under Yeltsin and as governor of Nizhny Novgorod) was a part of all that. While I dont doubt he had American friends and reasonable contacts, Russia has had laws about taking funding from foreigners and has been wary about politicians in that sense for some time now.

          Here is some extra colour on his last minutes from Reuters

          Death threats and a late night dinner before Russia’s Nemtsov was shot dead


          It would appear that he has been spotted (walking around Red Square out of GUM would be easy for that) and that the car has driven off South over the bridge. For mine that is interesting as the South side of the river is fairly crowded street wise and CCTV is almost everywhere, as it is anywhere around Red Square, and if a car has waited for him then it would be almost certain the car details have been noted by security (always heavy on Red Square and environs)

      • Comprehensive view Gunna – thanks.

        “I’m afraid Putin will kill me. I believe that he was the one who unleashed the war in the Ukraine. I couldn’t dislike him more.”

        What is clear is that Nemtsov feared for his personal safety. His report revealing some $30 billion of the $50 billion spent on the Sochi Games was ‘stolen’ ruffled many. His current report (to be published posthumously) was set to ruffle Vladmir Putin who Nemtsov believed was wholly responsible for aggressive action in Ukraine and possibly has intent for similar further afield.

        Events of the night moved rapidly. Nemtsov was shot, his female compassion escaped unharmed. CCTC footage was allegedly seized and obtained by a media outlet which claims footage is clear enough to identiy events. Rapid police response and exceptional access for media, crime scene cleared and, apparently, washed down within hours…swift and merciless.

        Now the world sit back an waits to see this Russian Roulette play out. Nemtsov’s political party, the People’s Freedom Party had the motto “For Russia without Lawlessness and Corruption”. Big call.

        As someone noted Nemtsov ‘received four bullets, one for each child he leaves behind.’ ‘Moscow will not sleep tonight’.

      • While I dont doubt he had American friends and reasonable contacts, Russia has had laws about taking funding from foreigners and has been wary about politicians in that sense for some time now.

        If you don’t mind me saying, that’s a slightly naive view of how US support for regime-changing opposition works.

        They don’t use SWIFT to transfer money to bank accounts, or any other traceable means.

        • If you don’t mind me saying, that’s a slightly naive view of how US support for regime-changing opposition works.

          If you don’t mind me saying, that’s a slightly naive view of how Russian security works – particularly when it comes to their own opposition political identities.

      • If you don’t mind me saying, that’s a slightly naive view of how Russian security works – particularly when it comes to their own opposition political identities

        No, that’s what I’m saying, that any covert interaction he was having, at this sensitive time with the US desperate for a win against Putin, would place him in mortal danger.

        Looks to me like he took too many chances.

        • … are suggesting that a man who has played the game of Russian politics for twenty years, as an opposition to the administration figure, is naive about the security environment he is in?

          at this sensitive time with the US desperate for a win against Putin

          OK I could buy the concept, but have difficulty imagining what form that takes, and I suspect that may be the quandary the US finds itself in. Particularly if you think that the Chinese would be observing how the US handles Russia and factoring in the implications of that for its relations vis China. What do you think would be the situation the US would seek to be crafting in Russia?

      • … are suggesting that a man who has played the game of Russian politics for twenty years, as an opposition to the administration figure, is naive about the security environment he is in?

        I’m saying that I’d be flabbergasted if the US did not reach out to him. Flabbergasted, knowing how they operate and have operated for decades. And all he’d have to do is give them the time of day to put a target on his back.

        As for the situation the US would be seeking to craft in Russia, how about a mood change against Putin that inhibits his regional gameplan? Anything the US can do to diminish Putin’s popularity is a win for the US.

      • And all he’d have to do is give them the time of day to put a target on his back.

        And if you are correct in saying Nemtsov was too canny to play footsie with the Americans, then they could equally have killed him, knowing it would look bad for Putin.

        Any which way! 😯

        I have zero trust in the US or the way they operate.

      • False flag does not have to be straight forward, as seen before.

        I ask first not who scores the most but who looses the most by removal of Nemetsov gang-style and then look at the diametrically opposite side.
        All the roads indeed lead to Rome.

      • Putin Promises to Punish Those Responsible for Nemtsov’s ‘Vile and Cynical’ Murder

        In the telegram to Dina Eydman, mother of Nemtsov, Putin said “Everything will be done so that the organisers and executors of this vile and cynical murder are punished.” He said Nemtsov had left a mark in Russian history, politics and public life and had always defended his point of view honestly.

        Analysts Blame Nemtsov’s Death on Russia’s ‘Legitimized Hate’

      • Chodley Wontok

        Nice work Gunna

        You will be pleased to know Peter Fraser’s sock puppets have loaded that comment up word for word over at Peter’s parallel property universe. They always enjoy your contributions over there

      • Many thanks for the look into the murk, Gunna. Outstanding. It should be elevated to a macrobiz post, not hidden in comments.

        As Wodley observes, your piece is being displayed in another place as opaque and ruthlessly self-interested as Kremlin players – rare praise indeed.

  6. ‘Greenspan: “The Stock Market Is Great”, But The Economy Feels Like In “The Late Stages Of The Great Depression”‘

    ‘Even with a parliamentary committee’s last-minute recommendations, Hollywood pirate hunters will still probably use your metadata against you in court.’

    • Viive.
      Here’s a tip on the local market.
      Mirabella Nckel ASX:MBN
      Massive buying all day Friday, started last thing Thursday. Something is afoot or under foot, or generally about.
      If any one knows what is going on tell me, this is not your common pump and dump buying. WW

  7. Guys, In case you hadn’t noticed, Australia is all out for 151, Probably something to do with Abbott,
    Imagine his humiliation. the K1W1’s will easily win.
    The country truly has gone to the dogs. WW

  8. Mining BoganMEMBER

    A special treat. Two War Nerd pieces.


    “I always found religious debate to be pedantry for the ignorant, a chance to show off by people who’ve only read one book.”


    “After that, the “unnecessary harassment” started…for no reason at all, except that he was doing everything but wearing a big balloon tied to his neck saying “Future Islamic State Executioner.”

    • Hey MB,
      What does your weekly internet tour look like?
      You always put up things that are worth a read.

      • Mining BoganMEMBER

        My partner wonders how someone could spend so much time on a computer without looking at porn. She watches The Block though. I think she’s sadder. *waves*

        “Free time is a terrible thing to waste. Read a book.”
        ― E.A. Bucchianeri

        Except grabbing a tablet is easier than cycling to the library. Which brings us to this quote.

        “It is named the “Web” for good reason.”
        ― David Foster Wallace

        There’s about ten sites I visit regularly that gives me heaps of links. Because there’s many things I don’t know I have to google a lot for understanding and follow even more links. I can never escape. Even Snake Plisskin couldn’t get me out of here…

      • I’m much the same. Something interesting always has a link to something else that is interesting. Or, there is a commenter who throws an interesting link up.

        My partner is just into gardening, woodwork and re watching Twin Peaks. She’s the man of the house. As long as it appears that I exercise once a week and stumble across some good music I’m allowed to carry on as I do.

      • Hey MB are you FIFO & no kids?

        “Free time is a terrible thing to waste. Read a book.”
        .. implies you have free time.

        But agree on your readings habits. I describe it to the other 1/2 as 3 dimensional reading….

        You look up one thing, that leads to another and then you wonder how did I get here…..

    • War Nerds on my regular read list. This one from a couple of weeks ago was good read:

      The War Nerd: Islamic State and American Narcissism


      I wish Abbott’s advisers would read just this section if anything:

      “Let’s start with the Sunni Arabs of Iraq, because they’re much more important to Islamic State’s combat power than the foreign fighters. Islamic State grew out of Al Qaeda Iraq, a nasty sectarian militia that massacred Shi’ite Arabs from the South for the crime of thinking they had finally won a chance to control Iraq, where they are the majority. When Islamic State says “Islamic,” they mean “Sunni,” and God help you if you’re some other kind of Muslim. The project is not universalist, but local and sectarian; always was, always will be.

      And it came out of nothing more than sullen resentment at being dethroned as the brutal bosses of Iraq. Until 2003, Sunni Arabs—Saddam’s people—had run the country with no more than a few tokens from the Shia and Christian minorities (and nobody at all from the non-Arab Kurds, whom they simply hated outright).

      Sunni Arabs have never been more than a third of the population of Iraq, perhaps no more than 28% (because Iraq’s Kurds, who were excluded from power when Sunni Arabs dominated the country, are counted as Sunni in religious breakdowns of the Iraqi population). But the Sunni Arabs, who dominated the key central zone of the country, had been in total control of everything that mattered (including Baghdad, the capital and great prize) for so many generations that they came to see their domination, and exclusion of the Shia, as the norm.”

      I doubt Abbott would be able to comprehend this let alone articulate it, it doesn’t easily make for a three word bogan slogan like “Daish death cult, ISIL death cult”. Sigh.

  9. The New Zealand welfare model – higher upfront investment for lower social and budget costs – heading to Australia?

    “And yet, despite this, during his debut appearance as Social Services Minister at the press club, Morrison was more than happy to warble the praises of a central part of Patrick McClure’s recommendations – the move to an “investment approach” for welfare.”


    Skippy… translation: more public money to loot, funnel to friends, political funders, past employers and coworkers or just to the highest bidder….

    • “Skippy… translation: more public money to loot….”

      I only had a brief experience with one of the job network agencies mentioned in Four Corners last week, but I must say nothing on that episode surprised me. They didn’t even find me a job, my current employer simply found me more hours, and the agency took the credit!

      I’d be very surprised if my experience was unique.
      I really feel for people involved in that process. Maybe as unemployment rises and more Australians are channeled through these services the greater the political backlash will be?

    • Saw something remarkably similar to years ago. Brainchild of UWA students I think. A structure similar to that pictured where, in need, all four sides would open out creating verandah shade and maximising airflow.

      Designed as a solution to inappropriate indigenous housing throughout the Pilbara and Kimberley, housing typically not suited to environment or culture.

      • Or was WA? Cashed Up Bogans are becoming an endangered species.

        Anyhoo, at least he invested his money windfall wisely (suped-up cars, motorbikes, tatts, etc). Clever man.

      • Nah, they’re still all over the shop. Probably thin out after August when the gas projects wind up construction.
        The property bubble has already started to show some serious cracks here. Walking around tells a more dire picture than the stats do.

    • Waddya mean ? Read Shiralee’s comment. He *earnt* it !

      I do like the prophetic closing quote, however:

      “The miners will spend the money on cars, bikes, parties,” she said. Mr. Dinnison, meanwhile, said he is committed to mining. “I’m qualified enough now that I’ll always have a job,” he said. “Without mining, I’d be an auto mechanic making $600 a week. I love mining, mate.”

    • I would be very interested to see where this fellow is at today.

      Hell, he’s probably my landlord!

    • @smithy

      Mummy dearest to the defence.


      I think Jimbo’s likeness is now in the dictionary under endangered species.

    • Mining BoganMEMBER

      Well, well, well…look at all you judgymental types. You and your fancy educations that leave you good for nothing more than holding the bank door open while me and my fellow bogans trundle in with wheelbarrows of cash.

      Damo was just saying the other day…well, a few months back ’cause he was laid off…about the reverse racism shown towards miners. He reckons he’s going to raise the rent in his investments so high that nobody will be able to afford to live there.

      Yeah, that’ll show youse smartarses.

  10. Pairgained aganst my will.

    Here is an interesting revelation about Telstra and the the whole broadband situation.

    Over the last couple of weeks our Naked ADSL2+ internet service has been a bit sick. SpeedTest has shown 5Mbits/sec and general dropouts. This is with a Naked ADSL2+ 200m from the exchange. The modem is reporting a 5Mbit line. So, I phone up the ISP support and (surprisingly) get a helpful english speaker. Confirmation that we have been pairgained by Telstra.

    Pairgaining is when there are not enough copper pairs back to the exchange, so Telstra multiplex two customers to a single copper pair. For traditional phone lines this works. It does not work for Naked ADSL2 lines – which require their own pair. That is why you pay a premium – to Telstra via the ISP.

    It turns out that about 2 weeks ago, someone on our street got an extra phone put in. The Telstra technician is not required to check Telstra records for available pairs and just looks for any line at the termination box that is not connected to a normal phone. The technician then pairgains that line – even if it is a subleased to an ADSL2 naked line. Let the customer and the ISP sort it out.

    So, Telstra sell the line to an ISP who onsell the line to a customer at $95 per month for a premium ADSL2 service. Telstra then effectively resell part of that line to someone else – without checking their records. They only fix the “error” if they are caught. There must be countless customers who just blame the ISP and churn to a new ISP or just never notice and overpay for a service that they no longer receive.

    Is this what we expect in a wealthy 1st world country with an economy the envy of the world? The national telecoms provider with a monopoly on our infrastructure is is pilfering from its customers like a petty official in a 3rd world Banana Republic. Class act Telstra. Or maybe that should be Class Action, Telstra.

    I wonder if this would be a defense for internet pirates? Well, I was on Pirate Bay and there was a copy of Game of Thrones. No one seemed to be using it, so I thought I would just grab it. Whoops simple mistake – I’ll just give it back. Illegal downloads delivered by a crooked National Telecoms provider. Crooked from one end to another.

    • That is very interesting – I had assumed that my speeds – much the same as yours was due to distance from the exchange (though I am not as close as you are).

      Of course there is a HCF cable running down the street but that is no help because Optus and Telstra refuse to wire up multiple dwellings (i.e. town houses).

      Probably no Class Action because I don’t recall ever being under the impression that a Naked Line involved a unshared slice of copper.

      But then I didn’t think that ADSL 2+ worked over pair gained copper – learn something new everyday!

      • ADSL2+ doesn’t work over a pairgain – the equipment just downgrades to ADSL1.

        That’s the bad thing – most people would not be able to tell the difference unless they go poking around inside their modem settings.

        I think ADSL2 does mean legally a full copper pair, because the whirlpool forums are full of complaints from people who can’t get ADSL2 because they are pair gained and don’t qualify. If you bought an ADSL2 naked then you bought a full copper pair (I think, but maybe Telstra have a weasel clause in there).

        Anyway, it does point out that FTN would at least solve this problem – which must be huge with the takeup of naked lines and apartments springing up all over the place.

    • Very interesting thanks DarkMatter.

      While I don’t profess to know much about these matters, that’s the whole point – they can pretty much get away with it except for the occasional person like yourself who knows to look further than the ISP.

      Nice way for Telstra to make themselves look good while undermining the competition, who are also their customers.

  11. Wow!! Just Wow…

    The AGW brigade has hit a new low in ideologue discussion with this one.

    How can these two new studies that examine the origins of the alleged global warming pause be taken seriously with contradictions such as “the rise of global surface temperatures has been easing since 1998” and “the pause may persist for years even in our notably warming world”.

    All these guys are trying to do is confirm their bias with these studies and it is clear they are grasping at straws cause they don’t have any real answers as to the record northern low temperatures.

    I suggested in December that a Solar Minimum may be upon us which could last for several decades with record low temperatures having been smashed during this northern winter and still it comes. It may also be the coolest March on record if minimal sunspot activity persists for the next several days.

    Check out these US record low temperatures http://www.nws.noaa.gov/view/national.php?prod=RER

    Sunspot activity is extremely low and has had diminishing highs for several months. A 1500 Gauss negatively polarized sunspot appeared during December which indicates our sun may be shutting down as it does every couple hundred years.

    Zeeman Gaus 1500 Explained https://www.youtube.com/watch?v=AN-sUqIrAZk

    And do these new studies say for how much longer should these record breaking cold winters persist for?
    “Eventually we expect temperatures to ‘catch up,’ but it may take longer than five years for that to happen”.

    So there you have it… Global warming should start up again sometime after 2020.

    • MAte, Yesterday I was doing some research into placer gold deposits in the beach sand of the Gold Coast.
      80 years ago Byron Bay and Ballina had a thriving gold industry mining gold from the beach sand.
      They did a good job cause there is hardly any left these days, but what I did learn that only recently, coupla million years ago, the beach up here was 40k to the east and the high tide was 140m lower. Doesn’t look good for the future, unless you live on top of Mt Tamborine. WW

      • Personal anecdote, as young children before Cudgen ruined the beaches around Cabarita we used to catch pippies for dad on the beach.

        Only in the last few years have I been able to find pippies here again, that is 55 years for this part of the ecology to recover.

        Don’t forget they never found the gold reef at Jimna if you are after gold.

      • Big deal.. Both continental and oceanic crusts can have massive vertical displacement over “a coupla million years” not even accounting for erosion.

        For instance Sydney harbour, as well as several other river outlets along the east coast, are actually flooded river valleys. However just to the west atop of the Blue Mountains you will find marine fossils in the sandstone, almost 1000m above sea-level.

        Also when the diamond bearing kimberlite pipes were formed billions of years ago in the Argyles and South Africa they were actually several kilometres above todays surface level. Erosion was the main culprit there, however the Indian Ocean floor is covered in raw high quality alluvial diamonds, however mostly uneconomic.

      • notsofastMEMBER


        I think you will find it was only 20,000 years ago that the sea level was 120m lower than today’s sea level, during the last Glacial Maximum. And it is very worthwhile noting that the last 10,000 years or so of sea level stability is very, very unusual on the geological record. Sea level has in general in the past not been stable and in some periods it has changed very rapidly. Such as the change that occurred about 14,000 years ago during MeltWater Pulse 1A where sea level changed about 20m in 400years or about 5m a century.

        It might also be worth noting that at the peak of the last interglacial during the Eemian, about 125,000 years ago, sea level was about 5 meters higher than it is today. And to think this was all before we had humans causing massive land subsidence due to the pumping of enormous amounts of underground water out from underneath their cities and coastal plains, having heavy buildings in their cities cause further land subsidence and having people remove and destroy natural coastal ecosystems that acted as a natural barriers storm surges.

      • NSF, the variation of ocean level is interesting in a geological perspective, especially when one is endeavoring to find the previous watercourses which would have been a channel for the gold and other heavy minerals out to sea.
        Underwater dredging today can access these deposits, and of course we have the massive dredging required for the new cruise ship terminal. Just keeping an eye on what mineral leases are required.WW

  12. I’ve got a question that may be daft- so please excuse. I don’t understand the machinations of “global” (inter- national) finance.
    If a sovereign state is free to print money in the fiat system – is this a WMD?
    is there any check against a foreign state printing money in order to buy a strategic stake in another sovereign state?

    • Houseless,

      It is not a WND simply because it is easy for a country to defend itself from a currency warrior by regulating the capital inflow transactions that the capital warrior uses.

      A currency warrior can only hold down the value of their currency relative to other currencies if they export capital – i.e buy off shore assets – real or financial.

      The reason is simply – exporting capital is like buying something.

      So if you want to sell a lot of goods (manufactured or otherwise) or services without buying goods or services AND stop your currency appreciating you need to be buying something – and that something are offshore assets.

      So the solution for a country who wants to stop a Currency Warrior from pushing down the relative value of their currency to make their goods and services (i.e. the things that produce jobs) is to STOP or severely limit capital imports that are at core simply the actions of a Currency Warrior trying to manipulate the relative value of their currency.

      Does this mean ban ALL capital imports?

      No – as capital inflows that clearly and directly increase the productive capacity of the economy are a good thing.

      Is it hard to pick the good from the bad?

      No – the bad ones stand out like beacons. Here are some examples

      1. Off shore borrowing by our banks for residential mortgages. These borrowing transactions are ready made for the currency warrior trying to export capital.

      2. Off shore sales of govt bonds – again – selling bonds off shore is like building a pipeline for a currency warefare to export capital.

      3. Purchasing the title to existing land with no serious plans to increase the productive capacity of that land – existing housing is a red hot example but much of the agricultural land is the same – do we seriously believe that we need Chinese, Japanese, British or even USA cowboys to show us to run a cattle farm?

      4. Purchasing the title to existing capital assets like industries, factories, distribution systems. Sure we hear a lot how new ownership will bring lots of new ideas but that is mostly overstated. Generally, the off shore parties are buying nice cosy oligopolies and natural monopolies and the only management skill they are bringing is how to gouge customers more effectively.

      Come on PFH007 – tell us about a good capital inflow?

      Aldi is a good example of productive investment, They have built hundreds of stores and introduced genuine competition. It is a shame that ALDI is the exception to the rule.

      In summary, a state with the capacity to print money holds no WMD with regard to other countries unless the other country is brain dead like Australia.

      A currency warrior relies on exporting capital and a country like Australia exercised some discretion and discernment over only allowing productive capital inflows the currency warrior would have to look elsewhere for a sucker.

      • Great explanation thanks Pfh. You’ve clarified a whole bunch of stuff for me with that post.

        On the downside, I’ve just realised that as a country we’re even more stupid than I thought.

        Cue Graham Kennedy crow call.

      • Not sure I agree completely.
        Take for instance the whole Mining Capex boom of the last decade. Most of this money came from abroad, most of this capital was for the development of “productive” assets (an operating mine. The importing of this capital pushed the exchange rate to obscene levels which adversely affected the viability of other Aussie manufactures.
        None of this was avoidable if Australia “allowed” this investment, to not allow the investment sends out an equally confused message.

        IMHO the solution was to ring fence areas like the Pillbara and declare these regions SEZ’s (special economic zones) i.e.not really part of Australia. For this to work not only would the capital need to be constrained the labor would also need to be constrained and completely imported. (as in 457’s on steroids)

        Problem is that everyone wanted their mines/ gas-wells opened like yesterday, so they bid up the prices of everything and I mean everything this new capital flowed into Bogan pay-packets car truck and machinery purchase/leases and lots of equity windfall gains for those holding mining leases. NONE of this was avoidable by simply having capital restrictions. on financial cash flows. Of course the cherry on the top was SWF’s buying Aussie bonds at prices above USD parity. Today these SWF’s are looking at 30% losses on their investments with this “value” of this having flowed through to Aussie battlers by way of increased purchasing power, of course it decimated Aussie manufacturing so they have a new LCDTV at the cost of their job (or their neighbors job). What’s unfortunate is that most Aussies I talk to think this was a good trade, my new TV, your problem….a bit naive but accurate.

        • I keep coming back the the flawse type line about there though…..

          The mining companies appear Australian but in the main they arent – they are global capital operations which are just located in Australia for as long as the ore is there. They didnt give a rats toss about nailing the AUD exchange rate to the roof. The failing of the mining investment boom was the failing of government (both sides) to shape it to serve Australian interests. The miners bought off the media, decapitated Rudd (and I am sure that decapitating the guy made plenty of sense [I wasnt here], but he was leading towards shaping mining to some form of Australian national interest at the time he was knifed) and pushed the line in the media that lots of high paying short term jobs in the construction phase and some royalties at the production end was all that the Australian economy should be expecting from the mining investment boom – and then to keep mum about the fact that the cost for this was the euthenasing of the externally exposed side of the economy. though they werent to blame for the national obsession with turning that income – such as it was – into a major real estate debt/GDP issue

      • China Bob,

        That is a legitimate question – re mining CAPEX – as generally speaking investment in the development of mines is a lot more productive than much of what passed for ‘Oz investment’ over the last 30 years.

        My position is that while productive too much mining investment in too shorter period is not in the national interest because of the lasting damage it causes to overall structure of the economy.

        A short boom that causes a lot of damage over the mid to longer term.

        Plus as we are starting to see right now, the mining industry are just as bad as everyone else at making wise investments that stack up. The industry (hello 3d1k) was talking about a 30 year boom as much as anyone.

        The most sensible approach in my opinion is to regulate the rate of mining industry expansion during boom periods with as little picking of winners by government as possible. This is why I talk about tradeable export volume licences for mineral exports.

        The government sets the volume limits for a period and then auctions off the rights to export those volumes. The rights and transferrable and will find their way to the miner who most wants to export.

        This allows the government to set the overall maximum rate of growth for future periods, earn income from the auction, and leave up to the miners to trade the licences to work out who is doing the exporting. States still get to charge their royalties.

        A sovereign wealth fund approach is essentially a form of currency warfare. It is trying to have your cake and eat it. Dig up minerals but export the capital so the exchange rate is not affected.

        I would be a hypocrite if I suggested that Australia seek to defend itself against currency warfare but then seek to do exactly that to other countries.

        Plus as you point – handing large slabs of cash over to the management of sovereign wealth funds is likely to see a lot of dud investments.

        Better to leave minerals in the ground to future generations than convert them into bucks and hope not to squander them.

        Gunna, is pretty close to the mark when he notes that most of our mining companies are owned off shore and that is a pretty good reason why the mining industry and its shills will never talk frankly about what is in the national interest as their interest is to rip up the mineral assets and flog them off as fast as they can.

        The Federal ALP ran into problems with mining because it did not confront the fundamental issue – which is that you can’t have a hi-speed mining sector expansion without causing damage to the overall structure of the economy. In any event they were not event talking about trying to neutralise the impact on the economy by exporting the additional capital generated.

        They thought they could have their cake and eat it with a resource rent tax that was as much ‘rip rip wood chip’ as what the industry wanted to do. It might have worked had they been able to grab the cash and pump into a sovereign but it was just too easy for the miners (and the LNP) to paint it for what it was – a central government ‘no negotiation with the states’ grab for cash.

      • @Pf
        No disagreement from me wrt your plans / intentions but in all honesty the expansion of Aussie mining was never about Australia it was always: China’s will be done and the markets will be done.

        Look no further than the price of IO. it started the decade in 2000 at under $20 / tonne and ended the decade having reached $180/tonne. That’s an insane price signal so naturally this change in price forced Australia’s hand. It is also wroth mentioning that the price was not really determined by BHP/Rio because the majority of the IO (at the time) was Chinese ore and the price reflected the difficulty to process sub 20% Fe ores.

        Australia amoungst other countries (notably Brazil and West Africa) were sitting on undeveloped 60+% Lump ores this enormous Aussie Capex investment occurred for three reasons
        – Proximity to China (equals lower shipping costs AND better ore shipping fleet utilization…the shippng point was very important for expansion)
        – Aussie gov’t indicated it was willing to have these mines developed
        -Low risk of nationalization or other African style strife

        You know as much as people talk about the collapse in IO the truth is that export volumes are still increasing. This year China will import almost a 1000 Million tonnes of IO.. thats up from less than 100M tonnes pa when the whole expansion started. So as much as you guys like to paint a picture of collapsing Chinese demand the truth is it has stabilized at around 800M tonnes of steel pa. (with maybe 50 to 70 M tonnes exported).

        Bottom line is these Aussie IO mines are not dud investments, they’re shipping enormous amounts of ore (over 5 times their pre 2000 volume) and shipping the ore at over $60/tonne (3 times the pre 2000 price) That’s one heck of a sustained growth rate 15 times dollar value in 15 years. Sure thats not as good as $120 ore which is not as good as $180 ore but lets get real its a @#$%ing commodity there is nothing high tech about IO Australia just happens to be lucky enough to have mountains of the stuff.

        The story with LNG is no different except to say that it got an additional boost from Fukushima and the whole Oil linked pricing, If you ask me $150/ barrel Oil was also all about China’s economic expansion and the demand side pressure this created. There was no planning and no way to plan for this the capital markets were simply reacting to demand driven price signals, the miners plans were also just extensions of the demand signal, they certainly did not build capacity ahead of this demand spike.

        Personally I find governments (the world over) are incredibly inept at understanding markets and responding appropriately to changes in demand, so any minerals export license plan would quickly become the focus of corruption if for no other reason then to gain licenses that would be all locked up by the incumbents …I know you suggest competitive Bid’s for export licenses but that kinda ignores the problem that mines are enormous capital investments, so the investors need to know for sure that they’ll be allowed to export what they develop….otherwise Australia would be no better than West Africa where every despot renegotiates mining leases the moment they gain power( (as a result of which the real capex expansion of African mines never happens)

        Bottom line: The Chinese dog was wagging its Australian tail …not the other way around,

      • China-Bob,

        Yes, the demand from China was unprecedented.

        But so what?

        You seem to be saying that just because China had enormous demand for commodities, Australia lost any ability to manage how it responded to that demand.


        Not sure why a public auction of tradeable export volume licences is prone to corruption.

        Hold auction.

        People bid

        The people pay money.

        No different to auctioning off anything else.

        As for the industry requiring certainty – how much certainly do they need?

        The govt announces the volume licences will be for XX hundred of millions of tonnes (or some gradually increasing amount) for the next 10 or 20 years.

        All companies know the total volume that can be exported and they can bid for it or buy licences on the secondary market.

        Sounds like plenty of certainty to me and the risk of corruption a hell of a lot less than the current model of money greased lobbying for railways and other forms of corporate wealth-fare

      • @Pf
        European Carbon credits was a license system similar to what you are proposing, and it’s not like that was gamed (cough cough).. IMHO Incumbents will always game any license system, imagine Rio failed to win licenses at competitive bid, they would simply tell the gov’t that they are going to close all their mines (suddenly the licenses are worthless so Rio buys them cheap. This is exactly what happened in Europe with carbon credits power stations told gov’t to issue more credits or they would stop producing power, Some countries issued Carbon credits to their companies so that they could trade them internationally these countries then did nothing to police their own industries..

        As an aside: Some years back when the whole mining craze starting I was talking to an owner of a Chinese steel mill. My question to him was, If China needs this capacity why doesn’t it simply draw up plans to invest and build the required mine capacity? His response was: Why dump that risk back on to the Chinese gov’t when the worlds capital markets will gladly strum up the cash if Chinese IO demand simply generates the right price signals. Today we can see the mine over capacity that has been created (as a result of free market forces) and with it the strong likelihood of 10 plus years of minimal returns on iO investments, I’m not sure it was worth the 5 to 10 years of extraordinary prices …we wont know the answer to this until we can see where IO prices settle for the next 10 years.

        However I can only say it again Chinese IO demand was not about Australia this demand exists irrespective of Australia’s actions so Australia’s best play was to capitalize on the demand and build capacity before other nations did it ahead of Australia.

    • Urk. This will not end well. Moral hazard times a bazillion.

      There’s no point being prudent if money is taken from you for doing so, and given to those who have not saved.

      At this point, it’s just insane wealth redistribution. Consume less then you produce? Fine, we’ll take it from you and give it to people who produce less than they consume.

      If continued, this is how civilisations fall.

  13. February 25 – Wall Street Journal (Andrew Browne):

    “China’s superrich are nervously watching as the Chinese currency weakens against the dollar. Because of the extreme concentration of money at the apex of Chinese society, national stability rests to an extraordinary extent in the hands of just two million or so families. They are the top 1% of urban households, and already, their confidence in China’s future under President Xi Jinping is shaky. Many are fleeing with their cash–not all of it, but enough to bid up prices of luxury real estate from Mayfair to Manhattan to Mission Bay, a waterfront area of Auckland, New Zealand”

    And Sydney.

    That and much more, Peripheral Fragility.


    • Yes, it’s happening, rats fleeing the sinking ship, and it just serves to prolong the agony of those who seek to buy a home in our major cities. In between the specufestors, rich Chinese refugees laundering their ill-gotten gains, and incompetent FIRB and APRA, they don’t have a chance.

      • Strangely it reminds me of the Grazier that put a trench around the haystack filled with diesel to scare the mice once lit, smoke instilled fear causing panicked rodents to flee haystack, blindly traversing burning diesel to death.

        Skippy… sadly the Grazier never measured the distance the mice could travel whilst ignited. Seems it was enough to make to the homestead….

    • StomperMEMBER

      F*** my great aunt had a waterfront property at Mission Beach, Auckland. Missed being rich by on lineage and a generation!

    • Mining BoganMEMBER

      There’s been a show on Oz history on Sunday nights. It’s been not too bad. Tonight’s episode closes with the gold boom finishing.

      What are the chances they’ll discuss the land crash that followed?

    • Gold to Australia!, the little country that could.

      I wonder if Tony and Joe are going to use this as evidence of their superior economic skills.

      Regardless, someone should make a short montage of how we did it, ala the Karate Kid

    • Sure it undercuts the pimps – no wonder they are scared about the interwebz. Do wonder how long it will take for the tax office to start cracking down on this behaviour?

      With you screen name you might just be apt to go undercover on their behalf. 😉