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Unconventional Economist
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  1. Brexit’s Impact on the World Economy (written June 17), draws interesting implications for US elections)
    https://www.project-syndicate.org/commentary/brexit-global-impact-by-anatole-kaletsky-2016-06
    Opinion polls indicate that British voters back the “Leave”campaign by a wide margin, 65% to 35%, if they did not complete high school, are over 60, or have “D, E” blue-collar occupations. By contrast, university graduates, voters under 40, and members of the “A, B” professional classes plan to vote “Remain” by similar margins of 60% to 40% and higher.

    The threat of such contagion means a Brexit vote could be the catalyst for another global crisis. This time, however, the workers who lose their jobs, the pensioners who lose their savings, and the homeowners who are trapped in negative equity will not be able to blame “the bankers.” Those who vote for populist upheavals will have no one but themselves to blame when their revolutions go wrong.

    • “The threat of such contagion means a Brexit vote could be the catalyst for another global crisis. This time, however, the workers who lose their jobs, the pensioners who lose their savings, and the homeowners who are trapped in negative equity will not be able to blame “the bankers.” Those who vote for populist upheavals will have no one but themselves to blame when their revolutions go wrong.” – Kaletsky

      Bloody economists. The global economy is as fragile as it is because these guys, and the rest of the so-called establishment, led us down the path of rapid liberalisation and globalisation without an adequate understanding the long term political and economic ramifications. Now they’re trying to blame us because their utopian vision of a global market is unraveling.

      • +1000 Bingo. Fragility is baked into any system that is centralized and complex. Before I get howled down as an ideologue, it’s all about entropy and the energy required to overcome & sustain complexity. It’s a law of the universe, not human ideology.

      • RobW – Absolutely spot on!!!!! Amazing now how the chattering elites are saying the ordinary people don’t know what they are thinking so we intellectual class need to over-rule them!!!!
        Dangerous attitudes!!!

      • Not sure how any intelligent person could have ever thought globalisation was going to work out well for us. People are dumb.

      • Babstar????, new blogger, but very insightful. Complexity is the essence of the issue
        Complexity was intended, designed by, to work on behalf of the elite, but is has only backfired, as it always has.This brexit is the start of the new order. Gunna’s note on the elite being out on a limb is the key
        Remember, “Let them eat cake”, weeks later her head was off.

      • babster – it’s not all about complexity when complexity can be broken down into component nodes and variables. Yet in essence James Clerke Maxwell in his work on control theory in engineering shows how systems tend to go out of control the more you try and control them – which is pretty much what has happened with the EU.

        If people are interested in understanding the components of complex systems analysis I recommend you take the free online course from David Feldman that starts this week entitled introduction to dynamical systems and chaos https://www.complexityexplorer.org/courses/61-introduction-to-dynamical-systems-and-chaos-summer-2016

        In terms of the level of debate on #Brexit; it’s interesting that the debate is more political than economic. It’s more about ideas and arguments and positions than facts and numbers. Macrobusiness has posted about the impossible trinity many times; yet never in relation to how this has impacted on the failure of European integration.

        I’ll post the following from my colleague Mike Tian who I asked to give an overview on quora:

        How does Mundell’s ‘impossible trinity’ or ‘unholy trinity’ apply to the failure of the euro area?

        The Trinity referred to here is:
        Independent monetary policy
        Free capital account
        Fixed exchange rates
        You can’t have all three at once. You may have one, or two of these three.

        The Euro is essentially a currency peg. So that’s one of the trinity taken care of. So which of the other two violates the trinity?

        It’s definitely not “Free capital account” — money moves fairly freely through Europe, the current Greek freeze excepted.

        What about “Independent monetary policy”? Ah ha. I think we found our culprit.

        Different parts of the Eurozone historically had very different economic characteristics and cycles. Historically, local monetary policy can accommodate for that. For example, if Germany is strong and Spain is weak, Germany would have a high interest rate and Spain a low one. The Peseta would also probably weaken against the Mark, and the system would reach some sort of equilibrium.

        With the Euro, this process stops working. For example, when countries like Spain, Italy, and Greece joined the Euro, all of a sudden they were getting a much lower interest rate than they were used to, or what the local economy justified. Imagine a Spanish home buyer, used to 8% interest rates, now can take on a 4% mortgage. Of course he’s going to buy a bigger house! The result was a big misallocation of capital leading eventually to severe crisis.

        Trying to have ALL THREE of the Trinity really laid the foundations of the Euro’s destruction.

        Now, people might say — what about the U.S.? Doesn’t the U.S. work much better when all 50 states use the U.S. Dollar, instead of their own state currency? If Europe were a “transfer union” like the U.S., would the Euro work?

        I think it would work BETTER than it does right now. But it would still be far from optimum.

        The difference between the U.S. and Europe is the level of economic integration and internal migration.

        Despite having a similar land area, the various U.S. states are more closely integrated with each other than the various Western European countries. After all, the states have similar cultures and languages. The legal framework is more integrated as well, as are aspects of the infrastructure (e.g. railroad and electrical networks).

        This integration, and having similar language / culture also has a major impact on labor migration, which is extremely important to keeping an economy in balance.

        In the U.S., a firm in New York has no problem hiring a person from Colorado. The question probably won’t even come up in the interview. But I think a German would find it much more difficult to hire a Greek, especially if the Greek didn’t speak fluent German.

        In the U.S., if one state has a very strong economy and was creating a huge number of jobs, it would suck in labor from the rest of the country, especially places where jobs are scarce. Having this “steam vent” in place prevents a situation that Greece finds itself in — 25% unemployment, whereas Germany has 5%. In the U.S., the person living in proverbial Greece would simply move to proverbial Germany and find a job. If you line up the unemployment rates of all the U.S. states next to each other, you’ll find that the difference between them is much smaller than that between all the Euro countries.

        A transfer union would help. The EU could tax everybody, and transfer money from well-to-do places to struggling places. Something like this would at least prevent Greeks from starving and burning their furniture for warmth. However, this still does not fix the problem of the lack of internal migration and Mundell’s Trinity.

        Various economists debate the point. I’ll give a real world example — Puerto Rico. Puerto Rico is a U.S. territory, but geographically isolated and not terribly well integrated into the U.S. economy because of that. They also have a bit different heritage and culture vs. the rest of the U.S., being a former Spanish speaking colony (although everyone speaks English nowadays too). However, in the U.S. Puerto Rico is similar to Greece.

        However, Puerto Rico does benefit from the transfer union of the United States. In fact, if PR were a state, it receives one of the highest per-capita wealth transfers from the government, particularly if their income tax advantages are counted.

        This “fiscal stimulus” from the U.S. government doesn’t seem to have done much for the PR economy. 40% of people are on food stamps, the per capita income is half that of the U.S., the unemployment rate is 2.5 times the U.S. average. True, most people aren’t starving and citizens of the PR are now more prosperous than that of Greece (highlighting the benefits of a transfer union), but it certainly isn’t ideal.

        Now understanding the outcomes from a Brexit is more than an analysis of what changes today in the economic sense or at a political level. It’s a potential critical juncture in the way that the world’s system operates at a psychological level. Systems are self forming, and if you take the above class, can see how they change by their attributes and by their own design.

        In summary, most people vote against change when the system is stable; as many people have a preference to stability and an understanding of systems that is quite low level; and hence try and find easy heuristics to make sense of the changing world around them. Yet from a psychological standpoint, when things are unstable – from an evolutionary point of view – it is always in the benefit of a suffering agent to enact change themself rather than get by in an environment forced upon them – even if the outcome may be worse in the short term at least. That is because if one is in control of one’s destiny or believes so, the brain is better able to deal with stress and duress.

        The pity is, that the level of debate around how to design sustaining systems is so muted, and so hidden in academic stacks of specialists who people don’t even know exist; that the benefit of our expert class in navigating the world through complex points often goes untapped. With a little bit of effort, you will come to learn more about complexity; systems analysis – and hopefully learn enough to keep an open mind on appraising system change; and reflect a new perspective on your position within that system; and help others around you to see new possibilities and narratives.

        http://www.mathematicians.org.au if you are interested in learning more about how these frameworks are applied to Australia’s place in the world.

      • Gillian Tett made an interesting observation on CNBC w/ Steve Liesman…. too paraphrase … the – Market – got it wrong, traders got it wrong, punters got it wrong and economists ultimately got it wrong, and with it the notion that such devices process information better is now battered and bruised…

        She then had nerve to suggest that maybe some might ask an historian, social psychologist or anthropologist about what happened…

        Disheveled Marsupial…. Blasphemy !!!!!

      • exactly right Skippy.

        The biggest cock up in all this is not the people of Britain but the global financial system and its much vaunted (up until 2008) ability to price risk.

        And if they could coq up US housing, if they could coq up Lehman brothers and the counterparty confidence issue if they could coq up Greece to the point Economic scorched earth needs to be visited upon them, if they could cock up Cypriot banks to the point where it was necessary to do a bank raid on savers, if they could cock up the probability of Brexit and its implications, how much certainty should we be allocating them?

    • ErmingtonPlumbingMEMBER

      http://www.dailymail.co.uk/debate/article-3659091/The-day-quiet-people-stood-roared-RICHARD-LITTLEJOHN-praises-spoken-EU-referendum-devastating-effect.html

      Lords without anger and honour, who dare not carry their swords.

      They fight by shuffling papers; they have bright dead alien eyes . . .

      We hear men speaking for us of new laws strong and sweet,

      Yet is there no man speaketh as we speak in the street . .

      The Secret People, published in 1907, which resonates down the ages, never more pertinently than today.

      “It is a glorious celebration of the stoicism and patriotism of ordinary British citizens, grown weary of being taken for granted, treated like cannon fodder and denied a voice in the corridors of power. Chesterton understood their innate conservatism, suspicion of authority and barely disguised contempt for the ruling class”

    • ErmingtonPlumbingMEMBER

      I was just listening to that Scottish independance Shelia on the radio and she is adamant the Scottish people will remain/ rejoin the European Union (where are the “British” going to keep their Nuclear Subs then?)
      This could lead to a unified Ireland as well.
      The United Kingdom wrecked, not by a Vote but by the abuse of the working class by Globalism and Neoliberalism.
      Thacher started this rolling ball.

      • Thats it for mine.

        The Brexit vote has shown the limitations (or one of the limitations) of essentially Monopoly Capitalism. If those uneducated undernourished yobs had had a few extra pounds spent on them this could all have been avoided

        Imagine for a moment if they didnt have the example of what the EU did to Greece and Eire fresh in their memories.

      • haroldusMEMBER

        The United Kingdom wrecked, not by a Vote but by the abuse of the working class by Globalism and Neoliberalism.

        Brother you could be right.

  2. vis this weekends Pascoemeter serve…….

    http://www.theage.com.au/business/the-economy/brexit-bugger-britain–its-the-world-that-counts-20160624-gprgy2.html

    The guy has lost it (not that I reckon he ever had it all that much)…..

    Brexit: Bugger Britain – it’s the world that counts

    http://www.theage.com.au/business/the-economy/brexit-bugger-britain–its-the-world-that-counts-20160624-gprgy2.html#ixzz4CVFi7Yaw

    Date June 24, 2016 – 5:44PM
    Pascoemeter

    I really don’t give a damn about Britain.

    So I thought I’d add an opinion piece revolving around it to your day, given that I am particularly knowledgeable about things I don’t give a damn about

    It’s of minor importance to Australia, worth only a couple of percentage points of our exports. If the Poms want to shoot themselves in their economic foot by withdrawing from a powerful trade bloc, I don’t care.

    What I do care about is filling up my opinion piece with sentiments about places I have told you from the outset I don’t care about

    But I do care about the isolationist small-mindedness that seems to have driven the Brexit vote; the shrinking vision, the reduced hearts and minds of what was once a rather grand outward-looking nation. The danger, as many have commented, is that it gives heart to similar xenophobic, anti-globalisation types.

    Yes, anyone not entirely feeling they get a good deal out of the political mainstream as it has operated over a generation which has included the greatest financial collapse of all time (and the bailing out of an awful lot of large banks by taxpayers), the rise of managerialism and the embedding of conservative mantra as social policy (including rampant immigration without an accompanying overt policy on the economic need for this, or even a statement about how the immigration would even work economically, beyond ‘the more the merrier’ and ‘suck it up’) is………….a small-minded, small-hearted, xenophobic, anti-globalised bigot. We should thank Pascoemeter here. He has gone to the very heart of the issue in one sentence. He supports unaccountable decisions made by the few being driven over the concerns of the many

    The same populist forces that swung the British public – that demonise migrants and, especially, refugees, that push a myth of a smaller, protectionist future being better – are at work here and more broadly in the world.

    That’s a worry.

    And never more so than during an election campaign revolving around two mainstream parties which do not want to go within a bulls roar of addressing Banks, Housing policy, immigration, the rights of foreign nationals to launder money in our real estate market, the rights of large corporates to employ foreign nationals when they don’t want to employ locals, widespread concern about the competitive aspects of the economy in the present and future, and the ability of that economy to sustain the highest privately indebted people in the world, let alone the need to tax the employees of the future to pay for the entitlements of those who own the houses of the present, while they are buying the same houses of those they are supporting with their taxes using the worlds largest mortgages.

    The sense that those who think they are entitled to drive their solutions over us may not have our best interests at heart, and may get out of control once we start, so it is better is that we don’t even start. Is this what the Pasoemeter is saying? That we aren’t mature enough to have the discussion? That only spouting business journalists in heavily loss making media organisations who have the right to ask questions? Should we ask questions about the possibility the entire global financial system has completely mispriced the possibility of Brexit? Are you going to ask that question or are you just going to hector us about being small minded bigots?

    Many of the protagonists know no better. They are people with minds closed to the reality of the world being made a better place by maximising engagement, by welcoming differences and enlargement. There are others, the worst of them, happy to exploit ignorance for their short-term advantage. It sells newspapers. It can win an election. It can give an aspirant power.

    Is Pascoemeter suggesting that many of the protagonists are know nothing small minded bigots, so it is best to assume that all of the protagonists are small minded bigots, and refuse to address any of the issues raised by those questioning the status quo?

    Is he suggesting that the only people raising concerns about such issues as…..

    money laundering in real estate,
    the level of immigration running at 4 times the thirty year average,
    the use of primary school visas to support an entitlement by foreign nationals to by residential real estate,
    the overcrowding of our infrastructure,
    the widespread evidence of malpractice by our financial system,
    the margin generation practices by our corporates
    the use of foreign labour and 457 visas
    the complete lack of an economic narrative about where this country is going
    the complete avoidance of discussion why we have the most expensive houses in the world, or that we have millionaires claiming welfare payments on the basis of not having their own home calculated in the entitlement deliberation, while we have young families paying life deforming mortgages for a roof over their heads
    etc etc etc

    ….is only coming from small minded bigots or those seeking some sort of power advantage (notwithstanding that our mainstream parties are united by a fierce desire not to have most of those issues arise at all during the longest election campaign in a generation) or seeking to sell newspapers (notwithstanding that there are only two sellers of newspapers – his outfit and Uncle Ruperts – and that they are both losing money hand over fist, both desperate for revenues, both clinging desperately to the banking and real estate advertising spend, and that this is supported by the very factors that our mainstream politicians and press don’t want to discuss). Is this what Pacoemeter is suggesting? Does Pascoemeter ‘get’ that any other interpretation of phenomena happening in this world is possible other than that he has a vested interest in criticising?

    The ignorant still view the interactions of nations as zero-sum games. They don’t grasp that globalisation is a win-win process, that the sum of our individual nations is indeed greater than the parts. They are blind to the lessons of post-WW2 Europe and the post-Cold War world as greater internationalism was embraced across trade and human movement.

    Is Pascoemeter suggesting that we don’t engage with ignorance and educate it, but we should ignore it, that we don’t discuss the issues the ignorant are ignorant about and talk them through their concerns, but deny them that discussion? That we ignore the ignorant? And who decides when they are ignorant or not?

    Lets explore that Pascoemeter hypothesis some more. If the interactions between nations are not zero sums games are they 100% win-win? Or could they be 70% win-win and 30% zero sum?

    Or if they are win-win at a national level does this mean that not a single individual in those nations ever loses, or that somehow the decisionmaking processes within those nations send the winnings to one section of those nations while other sections of those nations may experience a diminution of their winnings (we could put that in small print – maybe it is already in small print in those trade agreements we don’t get to look ahead before our politicians sign them on our behalf).

    Do those suspecting that they may not be getting any winnings from the interaction between nations game have a review mechanism? Can they raise concerns? (or are they ignorant and should be ignored?).

    The lessons of post WW2 Europe we about making sure that everyone gets a piece of the pie. The lessons of Brexit (and the general post 1980s experience) is that many feel they no longer are, and that those who used to make sure that all people were getting some slice of the pie are now welcoming suitcases full of cash carried into town by someone they know nothing about. Does that greater internationalism embrace have any downsides Pascoemeter? Or is it only upside in your Panglossian world?

    The lack of confidence in a nation’s ability to absorb migrants, to compete in a wider world, is a little sad. In the end, that’s what Brexit was really about.

    The saddest thing is that if the benefits are so obvious and manifest then the selling pitch has faltered somewhere. Is it a lack of confidence in a nations ability to take migrants or a lack of being able to see the point if all it does is overcrowd infrastructure, contribute to higher mortgages, and welcome dubiously acquired capital flows that nobody wants to talk about? Is it an inability to compete or a suspicion that all that extra competition isn’t actually doing much for the day to day experience, Pascoemeter? Or that the benefits of all that extra competition are going to people sitting in nice offices in nice views telling us what we should think, while the mugaccinos are increasingly frothy?

    There are people in most countries that feel that way. Weak leadership either feeds on or gives in to their fears. Strong leadership resists the ignorance and actually leads rather than follows the fear-mongering minority. Domestically, there is a duty to educate Australians about the massive rise in living standards we have achieved through embracing globalisation and migration.

    So that gerrybuilt 600K 4 bedder in 400square metres, 80 klm from the CBD is a better experience than the brick veneer on 800 our parents bought, 30 klm closer in? Did those miniscule looking mortgage payments of the past provide greater satisfaction than the ones being serviced now with extra hours in the health care sector looking after the mortgagors? As for your thoughts about leadership should we get in touch with Vladimir Putin? There is not an issue he will not discuss with his people, and there seems to be loads that our politicians don’t want to talk to us about. Finally if Australians haven’t been educated enough about the dramatic rise in our living standards (sufficient to feel they have had one – maybe they got one of those dodgy private courses) should we wait until they have been or should we ram some more down their throats while they still don’t get it? Please tell us, oh strong one!

    The world’s markets are suffering a knee-jerk reaction to the UK’s vote to be smaller. The actual decision doesn’t matter much to the rest of us, as long as the knee-jerk itself doesn’t upset fundamentals.

    Dear Pascoemeter, you are a business journalist. Why don’t you ask your local bank about their cost of capital? Is the potential dismemberment about the worlds second most used currency a fundamental in your view? And if it does upset fundamentals how well positioned is the Australian economy, how well do our uber sized debts (to pay our uber sized mortgages) look as a servicing requirement at that point?

    When the immediate shock passes, it will take some years for the UK to extract itself from the European community. The Scots and even the Northern Irish might reconsider their positions and the UK could further shrink. Doesn’t matter to me if what was once a global power becomes a less relevant little island off the coast of Europe.

    Under article 50 of their treaty it needs to be done in les s than 2 years Pascoemeter. The Scots and Northern Irish are almost certain to reconsider their positions. Do you think this could have any international effects? (which may affect fundamentals, such as the pound Sterling, still one of the 5 most used global currencies). Do you think it may impact on the way the EU deals with people remaining within its aegis? Or the companies they control? Do you think that the EU may become a little more focussed on making sure that the people of the EU see their win, and maybe less on ensuring that their counterparties also get a win? Could the small minded people inside the EU, or anywhere else for that matter, now see their elites paying extra special attention to them getting a slice of pie and explaining it to them real well? If all those elites were to go that way do you think that our elites may go the same path or do you reckon they would avoid addressing the day to day experiences of the punterariat a little longer? Do you reckon we (a nation capable of engaging with the rest of the world in nothing but the exchange of dirt) are likely to be more or less significant than the UK (home of the worlds largest financial centre, with generations of capital management expertise) given that we are even further off the coast of anywhere?

    But this caving in to populism in having such a dangerous plebiscite, this lack of leadership, should be a warning to others not to let the lies and myths of the xenophobes and small-world types go unchallenged. The steps backward to a greater degree of tribalism, of embellishing nationalism, can be a siren song for the power-hungry.

    What, so there are no power hungry in the new globalised win-win world? Is explaining things thoroughly to a people really that dangerous? Wouldnt your real power seeker want a piece of that bigger connected power, especially if there were more people to dilute the downsides with? Shouldn’t those lies myths and xenophobes be addressed with rational discussion? Are you saying they should be ignored?

    Samuel Johnson said it first: Patriotism is the last refuge of the scoundrel.

    Yeah, and La Rochefoucauld rightly noted that silence was often contempt.

    But all that said, somebody had best start thinking about the here and now, for the end of cycle shock HnH often refers to is here and all the certainty of the Pascoemeters world is going to be swept away

    • Thanks Gunna

      JHC!!!! Does this bloke listen to himself – I guess not. Does a single part of his brain move when he writes – obviously not.
      This is classic “Strong leadership resists the ignorance”
      “But this caving in to populism in having such a dangerous plebiscite, this lack of leadership”

      Yes Michael!!! We need a STRONG leader. Screw giving the ordinary people a say in how they are governed! JHC wept!

    • I wonder if it occurs to Michael that it is his ignorant BS that is at the core of this uprising of ordinary people who have to live in the REAL world?
      I suppose who cares about them? It’s only the chattering elites who ought count eh!

    • Stephen Morris

      Thank you for dissecting the Pacometer this morning.

      At least we may hope that if the Pascometer is opposed to Brexit then it will be a great success.

      My own contribution (which The Age hasn’t yet posted):

      Let the words of Franklin and Lincoln ring out:

      “They who can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety.”

      And Lincoln:

      “Any people anywhere, being inclined and having the power, have the right to rise up and shake off the existing government, and form a new one that suits them better. This is a most valuable, a most sacred right—a right, which we hope and believe, is to liberate the world. Nor is this right confined to cases in which the whole people of an existing government may choose to exercise it. Any portion of such people, that can, may revolutionize, and make their own of so much of the territory as they inhabit.” (Abraham Lincoln, speech to Congress, 12 February 1848 on the secession of Texas).

      Elitists the world over are in blind fury this morning at seeing the riff-raff, the hoi polloi, the “stinking ignorant scum” rise up and defy their natural born Leaders. But what we have here is the old morality tale of appeasement and resistance.

      When a bully – or in this case a clique of elite bullies – threaten you with vile retribution if you fail to surrender to their tyranny, then the only strategy for long term survival is to resist. Resistance may well incur short run pain. It may incur a great deal of pain. But the alternative is always far worse.

      The people of Briton have shown enormous courage. They will come through this. And both Britain (whether united or as separately independent England and Scotland) and the world will be better for it.

      • Well said. We need some of it here in Australia. We seem so fractured though. With a huge Chinese population, and growing, we aren’t looking for the same things. We don’t have the same background, ideals and culture, or vision of the future.

        We will not collectively vote on anything the same way we would have 10 or twenty years ago.,

        Essentially we’ve given away our sovereignty..How could we have been so monumentally stupid?

      • Richard
        Loss of sovereignty? Who cares (or ever cared)?
        Let nothing stand in the way of our appetite for trinkets!

      • “Let nothing stand in the way of our appetite for trinkets!”

        “Spectators Of Suicide”

        Obedience to the law is free desire
        Under curfew from neon barbed wire
        Wasting away this country, wearing like a born dead
        Free heroin shots for those who never beg

        Spectators of suicide
        Exploding in society’s eye
        Democracy is an empty lie
        Dead like our yesterdays tonight

        The only free choice is refusal to pay
        Life reduced to suicidal pain
        Cigarettes a life-line, it’s safety in death
        Choking on the billboards, advertised and fed

        Spectators of suicide
        Exploding in society’s eye
        Democracy is an empty lie
        Dead like our yesterdays tonight

        You’re gonna shoot us dead with decadence
        You’re gonna shoot us dead with decadence

        https://www.youtube.com/watch?v=rrTGRZZuDTI

    • Yes thank you Gunna. Well written and most enjoyable. I feel better for it this morning. Brexit is the best thing to happen to the world in a long time. It is less about xenophobia and more about the loss of community.

      • Amazing how often that loss of community theme comes up in sea change & tree change towns in Oz, as their communities are overrun & changed just by retirees & city refugees very presence. A lot of disenchantment & moving on is currently occurring looking to find that sense of community somewhere else……

        ‘Influx of dreggy types’. ‘Ice’. ‘Council’s a dud’. ‘Town is dying’. ‘Sub par everything’. – Whether it’s as magnified as much as they perceive it’s hard to argue with their general drift.

        Then when I visit the city no one looks happy anymore. More pretense than actual warmth – for similar reasons?

      • interested party

        Nudge, when you value finance above the welfare of your next door neighbour all the things you list just become symptoms of that behaviour.

        Brexit is maybe the first instalment of society’s rehab.

      • True words Nudge. The suburbs are a version in between. I see it very close to home. I have a child care centre across the road from me – early morning drop offs and late night pick ups of 2-3 year olds. The neighbourhood and high school around the corner a ghost town after 4pm, No-one in the streets no one plays cricket in the street, just lots of old people with many dogs in the park as traffic drags past.Then nothing. The only time we have anything like a human experience (that hasn’t been organised by a government agency) involves a real estate agent yelling at a crowd of strangers.

      • Your bang on Daniel.

        I wonder if it’s car culture or something new.

        I live in the outer suburbs but today was in the inner suburbs and it’s the same there too.

        No one walking around – just cars.

      • We’re seeing the symptoms. IP’s nailed the cause.
        Societies too busy serving money instead of the other way around.

        My city mates say the vibrancy’s gone because of increasing crowd density. Interweb stunting people skills gets a solid mention too. Slaving to make ends meet removing their sense of humour. And the place has become pushy because everybody’s climbing over the top of each other to ‘get ahead’.

        I used to miss it, but now I’m glad I left!

    • True. Now a majority of Brit peasants have rejected the ‘trickle down we all get richer/grow the economy by not funding it properly’ narrative as a con, and the social engineers and manipulators are not happy they are awaking up to it.
      A question: will only the Brits be punished for having expressed a desire for independence, or will the rout be global and we all learn to not question the status quo, or will it be business as usual by next Tuesday?

      • ErmingtonPlumbingMEMBER

        Its not often that “Class Struggle” gets so much attention in the “News”.

        The Global Plutocracy will absolutely punish the English people and quite severely, to make an example of them, to quell othet potential working class uprisings within the other “liberal Democracies”.

      • I would offer the vote was a resounding – NO – against the Financial -IRE sector economic template and unfettered capital controls which scour the orb seeking the next big thing regardless of societal outcomes for those not plugged in… cough the unwashed…

        Dishevled Marsupial…. seems some don’t want a two tiered world w/ extreme vertical top heavy apogee…

    • Clearly he doesn’t get the knock on effects this will obviously have on the Eurozone. Where anti integration sentiment will no doubt spread, at a time when the whole thing is ultimately being held together by the willingness of the German taxpayer to absorb future losses. When Draghi has done whatever it takes and has reached the floor on interest rates, yet peripheral spreads are again widening.
      Anyone with a shred of analytical ability would realise that Brexit isn’t a threat due to its effect on the UK. It’s a threat due to its effect on the Eurozone.
      I remember in 2010 I think, he said a weak US economy wasn’t a problem for Australia because we had a strong China.
      Then at the start of this year he had a go at the bear brigade following the RBS “sell everything except bonds” call and said fears of China contagion were overblown. Because Krugman said contagion effects on the US would be muted, and so the same must apply to Australia following that brilliant logic.
      Now he is saying (albeit without following his argument through to its logical conclusion) that the Eurozone is a non event for Australia and the global economy.
      So together, according to Pascoe about 60% of the global economy is a non event for the global economy and Australia. And he is calling the Brits parochial?
      It’s just classic Australian journalism. All cliche no substance.
      I mean what does the average Australian journo think they mean when they talk about globalisation?
      Do they mean trade links? Or financial links? And which part does the average man in the street get a benefit from? Yes trade isn’t zero sum. But inrush of dodgy money into London realestate is zero sum.
      btw the sell everything except bonds call is looking pretty good right about now.

    • “Domestically, there is a duty to educate Australians about the massive rise in (my) living standards we have achieved through embracing globalisation and migration”

      That small edit of his sentence probably sums it up. A man all snug and warm in his opulent estate can afford the luxury of musing on the noble struggle of the peons.

    • Anyone sitting down and nodding with agreement with this thin apologetic defending the right of elite politicians like fucking Boris Johnson to freely use racial fear and resentment for political ends needs to go outside and find a pond of reflection and take a good hard look at the face of fascism, because you are it. This election spurred gun violence in a peaceful modern country and caused marine le pen to have an outpouring of admiration. If you are on her side, better buy your jackboots now and beat the rush. You’re a disgrace gunnamatta.

      • No I’m not OK. I am genuinely frightened that this shitshow and Trump madness are trial balloons for the nasty politics of the first half of last century. Those who don’t understand history are doomed to repeat the window smashing reality that our stupid economic dead end has engineered for us. It’s time to step back from the brink of this stupidity and instead of simply taking advantage of those who lost from globalisation, give them back what was taken away.

        Johnson and his ilk are letting an ugly genie out of a bottle, you can bet the Hanson brigade are licking their thin, cruel lips over the prospect of doing so here.

      • Uteman, do you assume people voted to opt out on the immigration issue? Plenty here have indicated if eligible to vote it would be to exit, few have used that as their reasoning, and definitely not Gunna.

      • So as far as you’re concerned, if there is any trace of agreement from a right-wing party then it must be bad?

      • Uteman,
        Both you and Gunna voice legitimate concerns about this issue.
        I would have voted for Brexit, for the economic and political reasons that are discussed on this blog.
        From my reading of events and circumstances it is these, and not immigration, that are the causes of unnecessary hardship across the the developed world.
        Yet the knowledge that the underlying causes have manifested themselves into the symptom that is the racism we see horrifies me. Most people see the influx of immigration and blame that for their problems, and so they lash out at the immigrants. To quote Chris Rock “Don’t hate the player, hate the game.” At the moment the players are the ones who are suffering.
        The impressive thing about Bernie Sanders is that he questioned the rules of the game. Hopefully there are some other people who can also go after the game so that more people start to question it. Until that occurs and the voices find a language that can be understood by most it will be the populism of Trump, Le Pen and co that reap the benefits from the building anger.
        If the remain vote had succeeded the hate would still be simmering underneath, and the problems that are associated with it would, in my view, only had been delayed. Perhaps the best thing that can happen is that not much changes, thus people have to look a bit deeper than Euro membership and immigration to try to sort out the problems within modern Britain.
        My 2c.

      • Footsore understands what I am getting at. Jason, marine le pen is not your regular right winger, the French national front are genuine scary nut jobs that don’t rightly fit in the left-right narrative. Reactionary bigotry has a grand tradition on both sides of politics but every time some idiot pokes that tiger a lot of people die. It’s that simple.

      • i understand where you are coming from but i’m afraid you’ll have to harden up as the status quo is not working and people are mad

      • Uteman: anyone who disagrees with me is a racist and supports the National Front.

        There, summarised it for you.

    • I think the vote what what you think it means says more about your perspective than anything else. Attempt to synthesize the motivations of millions down to a few sentences is ambitious to say the least.

      If you think they voted to exit because they are:

      Racist – perhaps you think all white people are racist
      Globalisation – you don’t like the current system and think everyone else doesn’t either
      Dumb – you think democracy sucks and Europeans are so much better dressed and therefore better

      What isn’t said is interesting that no one is calling them cowards.

    • Indeed Gunna, beautifully put.

      We are prisoners of our own short-sighted greed and deserve the gilded concentration camp run by our betters because we are too servile to stand up and drive society in an equitable direction.

      What the “no” voters in the middle/educated/younger class have missed is the certainty that this middle class are the next pip to be squeezed by the elite.

  3. Yanis probably has it about right.

    This will turn the new Deutschmark zone, which will probably end at the Ukrainian border, into a huge engine of deflation (as the new currency goes through the roof and German factories lose international markets). Britain and China had better brace themselves for an even greater deflation shock wave under this scenario….The EU’s disintegration is now running at full speed. Building bridges across Europe is what Europe needs more than ever to avoid a slide into a deflationary, 1930s-like, abyss.

    • Yea that about sums up my feelings about Brexit.
      My external work email is full, my personal email is overflowing, and it’ll likely take me a week just to work my way through my partners only email.
      WoW I cant remember any previous event in the last 15 years that required more immediate attention, even the collapse of Lehman and the onset of the GFC proved to be less chaotic for me personally.

      I must admit I do get a chuckle out of Investors asking me how they can profit from Brexit, to most I’ve responded with the honest answer that our fund profited from increased volatility, Brexit was simply the source of that volatility. Apparently that was insufficient because senior partners are demanding that I invent a post facto Brexit strategy that adequately explains our market out performance.
      I guess it just shows how new the world of finance is to me that such a post facto demand comes as a surprise.
      I hope all MBers enjoy the market volatility while they can because it’s bound to settle down.

      • Remember China-Bob that Lehman happened on a Sunday and was not voted on by over a half a billion people, not to mention it was a slow train wreck unfolding from a few bespoke firms going poof two years previously… or the market was – forced – to eat LTCM…

        Disheveled Marsupial…. Whistling past grave yards is not a good methodology for risk assessment….

      • AtaraxianMEMBER

        After yesterday’s events margin calls on Monday might be mildly epic – even with central banks opening the liquidity spigots.

    • Puts Xi Jinping’s visit to London in 2015 into a different light.
      ‘The UK and China were becoming more interdependent and a “community of shared interests,”…’ – http://www.bbc.com/news/uk-34571436
      Hopefully doesn’t end the same way that England’s partnership with Japan did.

    • After following Yanis through the Greek debacle I find his position in Brexit odd when compared with his earlier rhetoric on the social damage caused by Brussels and Schauble to the EU dream. When he departed I was disappointed but still followed his blogs for a few months until I simply couldn’t understand where he was coming from. I stopped following his blog as many others did so I’m not sure what epiphany has occurred in the last six months for his criticism of the Brexit vote. As an economist he would understand that monetary union equates to surrender of sovereignity, which he was very outspoken over when Grexit was on the cards. Now he seems to have come full circle – I don’t understand the man after reading his commentary last night. He seems to have compromised his views on democratic process.

      • Britain was never even thinking of becoming part of monetary union. Their leave has nothing in similar to greece case.

      • Yeah ok doc but that’s not what I’m saying. I’m just expressing a view that Yanis has been all over the place since his departure.

        Let’s clear up this never ever issue of UK and the EMU. Sure the UK declined monetary union but the matter has always remained on the table even as late as January 2016 …see Bruegel http://bruegel.org/2016/03/completing-europes-economic-and-monetary-union/ ……. and further the tests were the UK to joint the EMU http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=URISERV%3Al25060. It’s important to understand that Sweden was the only one of the three to have unilaterally decided not to join the EMU. UK along with Denmark adopted opt out clauses which delayed their entry to the EMU dependent on various conditions being met.
        “In the negotiations leading up to the Maastricht Treaty in 1992, the UK was granted an opt out clause, leaving it up to the UK to decide whether it wanted to join the monetary union. In 1997, the UK government committed itself to the principle of joining the single currency, but with a number of important caveats.” See http://folk.uio.no/sholden/publikasjoner/outsider-final-draft.pdf for a full explanation.

        So to say the UK NEVER intended to join the EMU is not correct. They simply opted out at the time but left the door open to opt in when conditions were met. This is a clear distinction.

    • Have they asked the Scottish people (again), or do politicians make all the decisions?

      The people are rebelling, listen to them, or it will be violent.

    • I assume they would be stuck with the Euro as their sole currency. You would think there would be little appetite for that scenario given what has happened to the PIGS.

      • Yes the Scots and N Ireland need to look at the treatment handed out to Greece by Tusk and Schauble before embarking on an independence from Britain/stay in the EU push. The world is drowning in oil which is pretty much the only card they can play so I can’t see the sense in the argument. Cool heads need to prevail.

  4. $A bounced last night,
    Everyone must be considering hiding here now, not just the Chinese.

  5. http://www.theautomaticearth.com/2016/06/brexit-the-system-cannot-hold/
    (Via ZH)
    “Finally, this was of course not a vote about the -perhaps not so- United Kingdom, it was a vote about the EU. But the only thing we can expect from Brussels and all the 27 remaining capitals is damage control and more high handedness. It’s all the Junckers and Tusks and Schäubles and Dijsselbloems are capable of anymore.

    But it’s they, as much as David Cameron, who were voted down today. And they too should draw their conclusions, or this becomes not even so much about credibility as it becomes about sheer relevance.

    Even well before there will be negotiations with whoever represents Britain by the time it happens, the Brussels court circle will be confronted with a whole slew of calls for referendums in other member states. The cat is out of Pandora’s bag, and the genie out of her bottle.

    Many of the calls will come from the far-right, but it’s Brussels itself that created the space for these people to operate in. I’ve said it before, the EU does not prevent the next battle in Europe, it will create it.”
    “The Unholy Union depends on people not getting a say.”
    Exactly!!!!

    Just an aside I think the elites and the likes of Pascoe are a bit loose with this labeling people ‘Far Right’ over issues that really do need serious consideration if our societies are to survive.

    • This is about so much more than the European Union. It is about class, and inequality, and a politics now so professionalised that it has left most people staring at the rituals of Westminster with a mixture of anger and bafflement. Tangled up in the moment are howling political failures that only compounded that problem…all the cliches about people you cannot trust, answerable only to themselves…Most of all, Brexit is the consequence of the economic bargain struck in the early 1980s, whereby we waved goodbye to the security and certainties of the postwar settlement….What defines these furies is often clear enough: a terrible shortage of homes, an impossibly precarious job market, a too-often overlooked sense that men (and men are particularly relevant here) who would once have been certain in their identity as miners, or steelworkers, and now feel demeaned and ignored.

      http://tinyurl.com/hpv5j99

      • Very good link. Orwell is the prophet of what is coming. This is the end result of Mrs Thatchers policies of 35 years ago. It takes a long time to impoverish a country but you start by killing its goods producing ability. A warning about what is coming for Australia.

        That said, credits created by the Bank of England will be accepted long after credits created by the ECB are rejected by one and all. The ECB is nothing but a vendor financing vehicle for Germany.

    • Nothing on why we decided that democratic peace theory was only a good policy theory during the cold war huh

    • ErmingtonPlumbingMEMBER

      Well with increasing inequality and an ever smaller percentage of the population “with money”, Plutocracy is the system for them, which is just a nicer sounding name for dictatorship.
      Democracy is not what “People with money” want and the European Union is not a democracy, its a technocratic body that represents Capital not people.

      • This is true about the EU representing capital. Europeans and Brits have known this as they’ve increasingly felt pain since 08. But can the EU change? Can it become an entity that purely and purposefully supports the wellbeing and development of people and community? I’m seeing signs of anger, embarrassment and a retaliation against ordinary people. Hollande has warned the Brits to get out quickly so that the EU can deal with the scourge of ‘eurosceptism’. To me that just sounds like anger seeking revenge. Rather than do the hard yards, ask the big questions, and develop the EU into a haven of economic equality, they will only hasten its demise by criminalising dissent.

        Zizek was right vis a vis global capitalism. What we’re experiencing are the birth pangs of the new.
        It’s just that the new cannot be fascism.

    • 66% turnout for the last general election verses mid 70s for Brexit.

      don’t expect to see many more referendums being allowed anywhere on substantive issues

      • Mining BoganMEMBER

        Exactly. If we can’t play nice with democracy they’ll take it off us and give it to someone else.

        Look at the Pascoemeter rant. Don’t vote how they want us to and they chuck a wobbley. A big wobbley. That was a ‘if you don’t like it here, head down to the nearest Aeroflot office and book a flight to Russia’ moment.

      • hopefully they recognise that this is the vent outlet scenario (democracy) which doesn’t require German tanks keeping everyone who is wanting to revolt in line

      • interested party

        Bogan,
        “If we can’t play nice with democracy they’ll take it off us and give it to someone else.”

        Like some brown people in a desert somewhere……ask H R C for ideas….

    • A global recession / depression will be good for Australian property. The east coast of Australia falling into the ocean will be good for property. Everyone bad is good for Australian property!! Wankers.

  6. If you listen to Uber, its “driver partners” can make a comfortable living—as much as $90,000 a year in some markets. Last year, Uber released a study showing that its drivers earned an average of $17 an hour, above New York City’s living wage of $14.29 an hour. The reality of that claim has been contested before, with drivers saying they’re making closer to minimum wage than a living wage. But now, thanks to leaked internal price-modeling numbers and Uber’s own calculations, BuzzFeed reports, Uber drivers in three major U.S. markets are just barely scraping by.

    As of late 2015, drivers in Houston, Detroit, and Denver were all making less than $13.25 per hour after expenses. (Because drivers are independent contractors and not Uber employees, they shoulder the burden of costs like insurance, gas, maintenance, and their cars’ leases themselves). In Detroit, drivers are making $8.77 per hour after expenses. By comparison, Walmart pledged to raise its own minimum wage to $10 an hour earlier this year, CNET notes, though contract work like driving for a ride-hailing start-up, Uber would argue, provides flexibility that an hourly-wage-work job doesn’t. BuzzFeed’s calculations are based on a two-week period in late 2015, reflecting earnings after expenses (including Uber’s commission from fare), but do not take into account taxes.

    The average numbers cited by BuzzFeed likely contain a wide range of earnings, which vary from driver to driver and can go up or down depending on how Uber decides to price rides. More experienced drivers are more strategic about managing expenses or doing more trips per hour, BuzzFeed notes, making better use of their time. And in January, Uber implemented a series of fare cuts across 100 cities in the U.S. and Canada, intended to spur user demand and thus benefit drivers. Some drivers, unhappy with the fare cuts, protested. All three of the cities in BuzzFeed’s report had their fares cut, though Fortune reports Detroit’s fare cuts have been partially reversed.

    Uber seems to be actively improving its relationships with drivers, rolling out new driver-friendly policies like charging users a fee for keeping their drivers waiting. But its business model still depends on ensuring that drivers remain independent contractors, without access to costly benefits like health care or retirement plans. In April, Uber paid out $100 million to drivers in a class-action settlement who claimed they had been deliberately misclassified as contractors when they were really employees. Had they really been employees, Uber would have been responsible for a range of costs, including Social Security, overtime, and paid sick days. The settlement let Uber keep its contractor-based system in place, but ultimately highlighted the precariousness of the underlying economics of Uber’s business model: if Uber struggles to pay its drivers adequately in even its most profitable markets, its capacity to raise prices will be limited by its ability to create local and regional monopolies. As long as Lyft and other competitors remain in the game, Uber will have to continue burning billions to subsidize rides and fuel its global expansion.

    http://www.vanityfair.com/news/2016/06/leaked-documents-reveal-how-much-uber-drivers-really-make

    • TailorTrashMEMBER

      I watched the white men of Africa leave in the 60 ,70,s and 80,s ……many of them 3rd and 4th generation African born ……they left Such places as Kenya ,Zambia,Rhodesia , Mozambique and Angola …….often under threat for their lives ……they hated to leave what they felt was their homes ..( even if how they got those homes could be questioned ). I cannot understand how the white men of Australia can sell out their homes under no threat but out of pure greed ………when they no longer own their own country one wonders where they will flee to ? ……..

      • interested party

        “ I cannot understand how the white men of Australia can sell out their homes under no threat but out of pure greed “

        Hypnotised fools acting on subliminal guidances.

        When there is a constant staccato of propaganda that you are subjected to….it becomes the obvious action. How often do you hear the FIRE sector call out that you don’t have enough for retirement……. that your house is valued at x$…. interested in selling?…… that you need to get ‘ahead’ like life is a race or something.

        Remember this….. money is wealth, you are judged by your ‘wealth’ , and you are falling behind the ‘Jones’s’ next door.

        Now repeat after me….. money is wealth, I am judged by what I have, and I am coming last…….let’s say it again…… money is wealth, I am judged by what I have, and I am coming last……

    • Why do you think Putin is in China? He is making it clear to the Chinese that they can’t seat on the fence over what is possibly coming. If NATO (USA and its vassals) destroys Russia, China will be next.
      So WW3 on the way unless the “elite” finds another way to reset the debt.
      Hope you don’t really think NATO is promoting regional stability there?

    • We could use the NBN as a weapon of war.
      If a nation gets too upitty and above its station in the world, in come the FttN NBN to remind it of what a second rate country it really is.

    • The NBN we have is truly a deterrence weapon. Normally a country invade another country when the targeted country has attractive assets. So AFP is right we can’t reveal the secrets of how to build such effective weapon.

  7. Just a summery of what neoliberalism is and reconciliation wrt time line in question… too refresh…

    “The main points of neo-liberalism include:

    THE RULE OF THE MARKET. Liberating “free” enterprise or private enterprise from any bonds imposed by the government (the state) no matter how much social damage this causes. Greater openness to international trade and investment, as in NAFTA. Reduce wages by de-unionizing workers and eliminating workers’ rights that had been won over many years of struggle. No more price controls. All in all, total freedom of movement for capital, goods and services. To convince us this is good for us, they say “an unregulated market is the best way to increase economic growth, which will ultimately benefit everyone.” It’s like Reagan’s “supply-side” and “trickle-down” economics — but somehow the wealth didn’t trickle down very much.

    CUTTING PUBLIC EXPENDITURE FOR SOCIAL SERVICES like education and health care. REDUCING THE SAFETY-NET FOR THE POOR, and even maintenance of roads, bridges, water supply — again in the name of reducing government’s role. Of course, they don’t oppose government subsidies and tax benefits for business.

    DEREGULATION. Reduce government regulation of everything that could diminish profits, including protecting the environment and safety on the job.

    PRIVATIZATION. Sell state-owned enterprises, goods and services to private investors. This includes banks, key industries, railroads, toll highways, electricity, schools, hospitals and even fresh water. Although usually done in the name of greater efficiency, which is often needed, privatization has mainly had the effect of concentrating wealth even more in a few hands and making the public pay even more for its needs.

    ELIMINATING THE CONCEPT OF “THE PUBLIC GOOD” or “COMMUNITY” and replacing it with “individual responsibility.” Pressuring the poorest people in a society to find solutions to their lack of health care, education and social security all by themselves — then blaming them, if they fail, as “lazy.””

    Disheveled Marsupial… or putting the cart before the horses….

    • Good summary, Skip. It’s a little off topic, but for an economic system that has choice and personal responsibility at its core, why is it so hard to buy a computer made ethically? Why is it so hard to get information about the environmental impact of manufacturing of computers, or the wages and working conditions so I can make an informed and ethical choice about what I want to buy? Why does asking these questions seem to annoy some people so much?

      • RobW, “Why does asking these questions seem to annoy some people so much”.

        Because people don’t want to accept responsibility for the results of their buying stuff cheap, they want to be able to feign ignorance.

  8. “This is, in other words, the beginning of the end of Europe as we know it.

    This vote is also the grimmest of reminders of the power still held by the older generation, not only in the UK but around the world. Young Britons—the multicultural generation which grew up in and of Europe, the people who have only ever known European passports—voted overwhelmingly to remain. They’re the generation that just lost its future. Meanwhile, Britons over the age of 65, fed a diet of lies by a sensationalist UK press, voted by a large margin to leave. Most of them did so out of a misplaced belief that doing so might reduce immigration, or make them better off, or save them from meddling bureaucrats. In a couple of decades, most of those voters will be dead. But the consequences of their actions will resonate far beyond the grave.

    In calling this vote, David Cameron has opened up a true Pandora’s Box. The forces of narrow-minded nationalism have tasted a major victory; they will want more, much more. The economic malaise that has beset all of Europe for the past decade will work in their favor, as will the growing inequality that can be seen in almost every country worldwide. International institutions like the European Union, born of an idealistic belief in peace and prosperity, have become avatars of unaccountable power, and are much loathed by the suffering European middle classes.

    The result is that we are now entering a world in retreat from progress, a world of atavistic nationalisms and mutual distrust, a world in which we demonize foreigners and prefer walls to bridges.

    In November, the U.S. will have its own plebiscite, and will likely vote along similar lines to Britain. The cities, and the young, will vote for progress, inclusion, and unity. Meanwhile, the white, rural areas and the old will vote for a sepia-tinged dream of a past in which equality was something only straight white men really qualified for.

    Before the Brexit vote, I didn’t believe it could happen here. But Britain is significantly more cosmopolitan than America, and we managed to shoot ourselves (and all of Europe) straight through the heart.

    So, be afraid. The arc of the moral universe might bend towards justice, but it gets there in a very, very messy way. And after taking many steps forward, the world has now taken a giant step back”

    Tell the Swiss

    http://fusion.net/story/318538/england-brexit-screwed-us-all/?utm_source=twitter&utm_medium=social&utm_campaign=socialshare&utm_content=sticky+nav_mobile

    • “we are now entering a world in retreat from progress”

      That depends on how you define progress. The working class would not consider escalating costs of housing, education, and healthcare, as progress.

      • Typical of absolutist thinking simpletons who posit all change as inherently good and aggressively attempt to beat you over the head with a juxtaposition of a particular change vs bad outcome. Apparently being in a car progressing of a cliff is a good thing and if you are against it you are a bad person.

      • Great comment Freddy.

        Young Australians have to fight population growth.

        Challenge Greens and tell them opposing 2% pop growth a year is not racist. Or vote Sustainable Australia.

        Separate the issue. there are 10 000 refugee’s and 300 000 invited, able, skilled wealthy migrants.

    • Interesting take. I must admit I’m a little surprised that European leaders aren’t leveraging the dynamics of the issue to drive a wedge between the young dynamic productive sections of the British economy and the generation want’s to return to a 1950’s world
      As I see it this is not a vote about nationalism but rather a vote about how we individually and collectively define our nationalism. If I see myself as I’m first and foremost a European citizen than why do I care that some of my countrymen want to keep a quaint yet anachronistic idea of a British identity..
      A few years back there was a similar movement for Texas to secede from the US, it was never going to happen but the US made it very clear that regardless of the outcome all Texans were and would remain US citizens. For me whats missing is this immediate commitment from European leaders to tell all UK citizens that they are Europeans and will remain Europeans with full European rights. Instead we have a lot of knee jerk, if you don’t want to remain than F-off talk even from major European leaders, this talk itself point to a lack of European identity among it’s leadership and that’s what’s really sad for me.

      • China-Bob….

        It was actually the young that voted to leave and the old to stay… w/ the London area being the most pro stay….. everywhere else wanted to go….

      • skippy

        You got any analysis to back up your assertion that it was the young that wanted to leave?

        The Guardian contains some analysis which suggests that “[a]lthough the average age of an area wasn’t the best predictor of whether it would opt to leave or remain, it’s clear that densely populated urban areas with a lot of young people such as Hackney and Islington in London voted overwhelmingly to remain in the European Union.”

        http://www.theguardian.com/news/datablog/2016/jun/24/the-areas-and-demographics-where-the-brexit-vote-was-won

      • The EU was hardly about creating a single European identity. It is/was about creating a captured market for excess German capacity, and tying the Germans to their historic rivals the French.

      • @triage…

        The information I sited was from a breakdown on an MSM cable news channel [CNN (Amanpour) I believe], which supports your statement about urban / city demographics i.e. the only few places the younger age cohort supported remaining was in major CBD’s and inner rings of city’s like London, everywhere else, and I mean everywhere, especially to the east of London longitudinally voted heavily to leave.

        With that in mind its not hard to deduce that anyone not directly benefiting from FIRE sector beanies, does not see the long term benefits wrt remaining, which imo is telling that rumor control has it that there has been a 100% spike in people looking to move to Ireland.

        Disheveled Marsupial… seems the metadata collection on this gambit was grossly inaccurate…. probably observer bias compounded by a bad case of yes men syndrome…

    • The problem with your writing is that you assume the Euro-zone was created for the reason of improving the lives of those who are participating. This grand “project” however, was never about improving the lives of those within the union, rather it was all a bit of strategy devised for increasing power of the global elite.

      Have you ever thought that maybe us plebs were having our leg pulled this entire time? When they continue to smash the Euro further this year (economically, politically and through through the socially engineered migration crisis) and shift power to the East you will see how this was really meant to play out. As economies start to implode and people panic, they will seek relief from the only source that will be provided to them in due course. Through the IMF and the Chinese and Russians who were “good” all along. They will “save” us from our corrupted Western Elites, even though in reality this is all a smokescreen for consolidating power into a one-world government.

      Of course 99% of people assume that this is ludicrous. I mean, the Bilderbergers, banking and royal families would never actually devise anything in all their secret little meetings would they? Nah, they just sip champagne and laugh merrily. Or so the average pleb thinks.

      • George and EP,

        I don’t believe that is mig’s writing! The last 2 paras are from the link, so I guess the rest is a C & P from it. That’s how I read it and checked the link after your comments.

        Oh, and his last comment of “Tell the Swiss” who aren’t EU members.

    • “This vote is also the grimmest of reminders of the power still held by the older generation, not only in the UK but around the world. Young Britons—the multicultural generation which grew up in and of Europe, the people who have only ever known European passports—voted overwhelmingly to remain. They’re the generation that just lost its future”

      The smartest thing young people could have voted for was leave. Their passport and citizenship is the most valuable thing they have, I can’t believe you’re treating it so flippantly. Your generation is being conned. You’re lucky you’ve got wise old heads that voted leave FOR YOUR BENEFIT.

    • ‘”They’re a bunch of opportunistic Trots hiding behind a gum tree trying to pretend they’re Labor,”‘
      Lol.

    • Thats ironic given Labor seems to spend half its time pretending to be a light and fluffy version of the Coalition.

    • Classic Keating:

      They purloined the name Greens. We’re more green than they are,” he said.

      “Ratting on Rudd with the ETS scheme and walking away from the Malaysia Solution, things that required a bit of courage … they could’ve been the Yellows.”

      but more seriously:

      “Governments have tucked themselves away and let central banks lower interest rates in the hope, like lighting a match, if you strike it enough there might be a flame,” Mr Keating said.

      “The model has to change. That means a bigger role for government in things like infrastructure, the provision of important public services.”

    • Who da nown that the Hawke Keating years were the golden age of Australian politics. The watermelon greens exchanging the closet, for hiding behind the gumtreem.

    • Would Greens winning Higgins change anything? Even if they won ten more seats?

      Guardian visas? No, 457 visas? No, Population growth of 300 thousand a year? No, Foreigners buying realestate? No.

      GenY may as well vote LNP.

      The situation of young Australians voting Green is laughable.

      • FiftiesFibroShack

        It wouldn’t change much if Gen Y all voted Green, but Gen Y all voting LNP would be a disaster for them. They would get more 457s, more foreigners buying real estate, more dodgy schemes allowing high net worth individuals to buy their way in – all equalling downward pressure on their earnings and upward pressure on their expenses.

        You don’t seem to realise there has been a class war taking place for the last 30-40 years. Brexit, Trump, Bernie, all symptoms of a political and economic ideology that will only ever end in a large section of society being squeezed. Those who benefit the most would sit back and chuckle as you blame all on “socialists”.

        Face it, you’re part of the problem and don’t even know it.

  9. “Embattled Assistant Treasurer Kelly O’Dwyer has taken the extraordinary step of forcing Twitter to dismantle a social media “joke” account that compares her election campaign in Higgins to the disastrous 2013 loss of Indi by fellow Liberal Sophie Mirabella”

    What could possibly go wrong with that move?

    http://www.brisbanetimes.com.au/federal-politics/federal-election-2016/federal-election-2016-under-fire-kelly-odwyer-scuttles-twitter-joke-while-peter-costello-rushes-to-her-aid-20160625-gprqtb.html

    • That is a panic move.
      Hopefully it backfires and brings more attention onto the profile.
      I’m assuming that there is a cached version out there somewhere.

      • It may just backfire. According to the SMH Fairfax own the CC and that LNP staffer claims on a statdec she reps the CC owner!

    • Were these the ones?

      Does Soph have a position on Foreign Nationals buying Australian Real Estate? Does O’D?

      What have O’D’s achievements as a polly been?

  10. could it be that the elephant in the room and the root cause of all this turmoil is excessive global human population? too many heads migrating all over the globe looking for a quiet place to live without too many other heads… ?

    about time global leaders acknowledged the human population is expanding exponentially and needs to be arrested before chaos truly takes hold. http://www.populationinstitute.org/

    >check the clock at the link !

    Finally, if Australia’s youth was given a chance to over-throw the boomer over-lords that are making our society an inequitable living nightmare, I suggest they’d vote with similar enthusiasm as we saw with brexit. The trump effect is similar in nature…. its a protest against establishment more than anything, and the Australian system is as broken as any of them.

    The issue at the heart of JJJ’s Hack feature the other night will only get more and more vocal until there are riots on the street or the government listens…

    • “They” probably realised that – the population thing – some many decades back.By the 60’s ‘what was going to happen’ became clear, so we had two obvious attempts at population control – The Pill and the China 1 Child Policy ( yes, Pol Pot and his like did their bit as well) but the result is a calamitous society. In effect, we are a generation missing, all of us. The produce of the 60’s and China never arrived, and so we have a generation gap that is so apparent today. It’s why The Young and The Old are so far apart – because in ages they are! In their 50’s today, men are still being fathers for the first time when they were grandfathers in the past etc. Have the attempts at population control worked? We don’t know, except for the fact that there are more of us now!. But what we do know is that a generation of young men who would historically have fought each other over one reason or another – the traditional mehtod of population control – didn’t. Will they now? Perhaps…..

      • Population control will never be successful while capitalism asks for endless economic growth at all costs…

        Look at our government, if they can’t entice young’ns to breed faster, then they import more people from the immigrant pool…. they keep the level of population growth at the optimal rate to ensure sustained demand for real estate so as all their (and their boomer mates’) nest eggs do not erode in value…
        they have the whole system stitched up and it actually SUPPORTS higher population growth FFS!

      • @bendy wire

        “they have the whole system stitched up and it actually SUPPORTS higher population growth FFS!”

        Including promoting a non racist multicultural society that can’t or won’t even question population growth.

        The situation is easy to see through. The whole of Australia have been conned by the right. Far outclassed.

      • ” But what we do know is that a generation of young men who would historically have fought each other over one reason or another – the traditional mehtod of population control ”

        WW2 killed 60 million people all up. Global population growth is 90 million a year. Wars kill a tiny tiny fraction of population.

      • “The whole of Australia has been conned by the right. Far outclassed.”

        You’re not wrong there, Richard.

    • Population growth is at the core of every single problem Australia has.

      Vote Sustainable Australia.

      NOT GREENS, who don’t oppose the highest rate of growth in the western world, mainly made up of able, skilled people from affluent countries..

      • I will admit I like many of SAP’s policies, but there are some issues that are important to me they completely ignore. Over all I’m impressed.

      • RobW

        Stop mass population growth and there’s no problem not fixed.

        We can tweak the issues that are important to you after population’s controlled. Failing population control, none of anything else we do or want matters. That’s the harsh reality the dumb Greens are ignoring.

      • drsmithyMEMBER

        Stop mass population growth and there’s no problem not fixed.

        Tell us more about how stopping population growth will fix rampant corruption. Will it be the incredibly unlikely outbreak of honesty and goodwill, or just straight-up magic ?

      • drsmithy

        “Tell us more about how stopping population growth will fix rampant corruption. Will it be the incredibly unlikely outbreak of honesty and goodwill, or just straight-up magic ?”

        That’s easy. Give us one problem and we’ll fix it. Give us 100 and we’re overawed. It’s a psychological fact that when you jam too many rats in a cage their society falls apart and crowding is the only issue they deal with. How do you think average humans can deal with corruption when it takes them an hour and a half to get to and from work?

        In addition, populating with rich, mostly corrupt migrants can’t be helping can it?

        Do you actually think this stuff through, or you just look for holes in any argument against your BS socialist one world fking garbage? Most of us don’t want it mate because it’s hurting us.

        Address it now, or it will become violent and the least able will suffer the most. Time to use your brains instead of some moronic idealism that never made sense in the first place.

        Got any other problems that “can’t be fixed” with population control?

        Magic. LOL.

    • “Finally, if Australia’s youth was given a chance to over-throw the boomer over-lords”

      Not by voting Greens. They don’t oppose it.

      While youth vote for Greens without question, young Australian lives continue to be destroyed.

    • MichealMEMBER

      Population growth was not a problem before the introduction of hygiene and antibiotics.
      Large families are encouraged due to high mortality rates not because of external economic policy.

      • Yes, that and the petrol engine. Look at a population graph and it starts going exponential at the start of the industrial revolution and medical advances.

        A simple petrol engine does the work of thirty men. Average age of death has tripled in the west.

        We should be controlling it or it will control us in the most devastating way. Instead the Greens say nothing. How is that progressive? Get rid of these idiots and let a real environmental and fairness party evolve.

  11. Original John

    Wow, just wow. Read Gunna’s piece on brexit plus a lot of commentary from Europe etc, spoke with a German partner ladt night over dinner about it and got a lot of feedback from Singapore and Hong Kong based business people. Universal comment from people I spoke with: how did the markets and everyone get it so wrong? Will it really be as bad as they say? If it is, what will be the impact on China?

    • The market rely on the polls too much. There is no guarantee polls are always correct… even the Britexiters didn’t really believe they would actually win.

    • SweeperMEMBER

      The markets never have a clue about the likely outcome of events. Which means asset prices never reflect likely outcomes. They only reflect the opinion of what the average investor thinks the opinion of the average investor is. It’s the probability v uncertainty thing. If prices reflected likely probabilities why the huge swing between 15 Jun and 20 June. Surely the probabilities didn’t swing to the same extent. So what happened? Random guesses on what the average investor believed the average investor was thinking changed. Probabilities were always unknowable. Just like probabilities on the likely future return of sub-prime mortgages were always unknowable. Markets are inherently stupid.

  12. I have to say it’s disappointing to see that most people here (including Gunna whom I usually respect his opinion, but not on this occasion) are seeing this as a nationalist anti-establishment vote. The reality is that people who championed the leave campaign lied to their constituents, used scare tactics (now the Polish are taking your jobs, wait until the Turks are here), and – this is the most important – portrayed the bad and changing economy as a consequence of the EU membership.
    This is very reminiscent of the “Let’s make America great again” campaign championed by Trump.
    The problem with democracy is that it works when people are well informed to make decisions, but could lead to disastrous consequences when people are ill informed (or simply ignorant).
    Over the next few years, I suspect that the British people will realize that they had been lied to and sold a illusion, but it would be too late to turn things around. Do you remember the Arab Spring in Egypt and how every one was excited and thought that people finally took control of their destiny? Well, that honeymoon did not last long did it? If people think that Nigel Farage and Boris Johnson will bring prosperity to the British people and turn things back to the good ol days.. they are going to be disappointed.

    • Good point. Also Egypt was a double wammy.. At first they thought electing Muslim Brotherhood would be the end of all their troubles, but that seem to have left a lot to be desired… So they then welcomed the coup of the military, and it turned out to be even worse.

    • EU has always been a trade-imbalanced disaster destined for failure. The PIGS nations are all a one-way ticket to bankruptcy, and will run for the hills at the first opportunity. When they do it will have nothing to do with the propaganda or scare tactics you speak of.

    • interested party

      You do realise these people who lied are …….politicians, right?

      I would like to add to your comment though. I suspect that the migrant/asylum/refugee issue would have been close to the front of peoples concerns (nimby-ism ) and find it notable that the UK played a leading role in creating much of the ME mess that has spawned the human tide that is pushing into Europe….. and that the vote gave them an out on the future troubles that will envelope much of EU. Have the Brits washed their hands of a problem they helped create?

    • If people think that Nigel Farage and Boris Johnson will bring prosperity to the British people and turn things back to the good ol days.. they are going to be disappointed.

      everything in the media has told me that they don’t expect that, but why put up with the bullshit status quo

    • Dead right. Watching the BBC today and seeing a conservative “leave” supporter outright saying the movement of labour from the EU will not stop after brexit had the show presenter very nearly lose their shit. It’s a massive con job that has gone horribly wrong.

      • interested party

        Uteman
        “It’s a massive con job that has gone horribly wrong.”
        No, it’s not.
        It is human behaviour running to a script that is visible if you step back away from the noise.

      • Where the ‘loon pond’ is now 52% of the British electorate apparently. Attempting to paint half the population as welfare queens didn’t work so well for Mitt Romney; I’m quite impressed by many in the ‘remain’ camp’s ability to keep shooting themselves in the foot over and over and over and over. They failed to win hearts and minds; it’s as simple as that.

      • moderate mouse

        @LD….How absurd to compare the Remain camp to Romney’s flaccid scapegoating – it has so much more in common with the Leave campaign. Two-thirds of those who voted Leave identify as Tory voters – people with natural raisin-hearted loon pond tendencies. The other third were dragged over by capital-L Loon Ponders who had thrown away the dog whistles and picked up the megaphones – and you clowns are cheering it in! Be under no illusions, this is a triumph of the Hard Right, not some Fourth Way revolution. Why do you think the UK is being congratulated by Trump, Marine La Pen and the like, while everyone else shakes their head?

      • Yes! It’s obvious we should immediately shoot anyone with any sort of conservative leanings – in our judgement they are just loons and worthless. Perhaps some could be rejuvenated in re-education camps for a few years but overall loons can’t be changed. So probably best not to try to draft them up – just get rid of the lot – all 52 % OF THE POPULATION.

      • moderate mouse: I’m frequently painted by people on this blog as being a raving lefty. I really don’t like the LNP in its current form, for example. However, the painting of those who support Brexit as stupid/racist/etc… has been consistent, and I’d argue you’ve jumped on board.

        This is doing nothing but fanning the flames. For a large percentage of the population, things are getting worse, and for too long they’ve been dismissed as stupid/racist/uneducated/etc…

        The remain camp failed to explain itself well, and instead many in that camp (I’m looking at you, Guardian newspaper) decided that they would simply insult those they disagreed with instead.

      • moderate mouse

        @LD….what can I say? When people vote for fools and charlatans offering simple solutions to complex problems, and when those solutions consist largely of blaming foreigners for your woes, the logical conclusion is that, yes, they are both stupid, and racist. Deal with it.

      • … and there you go again. Unable to admit that Brexit vs Bremain is a debate with valid arguments on both sides. Instead, you’re just insulting people. And the Bremain camp lost to some degree because of this. Deal with it.

      • Flawse you are a fatuous dickhead. Jo Cox was shot and stabbed by a lunatic leaver pal, not the other way around. Nobody has advocated violence except the dickbag reactionaries usually responsible for it.

      • Know IdeaMEMBER

        Good lord! One murderer supposedly supports Brexit and suddenly the implication is that all those supporting Brexit are murderers (or at least advocates of violence). Stupendous logic. Go to the top of the class.

    • People have already been sold an illusion, that’s why we’re seeing things like Brexit and Trump. What you’re seeing are the consequences of having a failing economic and political system. People know they’re being screwed, but due to the complexity of economic and political systems they don’t entirely understand the causes or culprits. Hell, even interested parties can’t agree on what has gone wrong with the global economy, or why. At any rate, a failing system is fertile ground for change, and there will always be groups that will seek to exploit that to further their agenda. Look what happened during the last depression.

      What’s important to understand and accept that the status quo won’t be maintained. If those in power are not flexible enough to see it coming or offer a new direction, others will.

      • interested party

        RobW
        Think on this…..

        We as a global people, have just lived through the largest expansion of personal wealth in the history of mankind. People had opportunity to distract them; granted… it was debt based so a false benefit to most…. however, it was opportunity so people voted accordingly. What was in their best interest was the vote… always has been and always will be. Now that these opportunities have vaporised, leaving a very long bitter aftertaste that requires a lifetime of servitude to erase, people will again vote for their personal best interests….. which opens up the question as to what group voted which way, and why.
        The groups that appear to have voted ‘stay’ are those who benefitted from the financialization of their countrymen and wish for that lifestyle to continue…. but thats begs the question of ‘can this actually be achieved’ when debt is consuming social structures as we speak.
        The other side of the vote have had enough of the servitude but also fear for the availability of dwindling jobs and also have fears for the migrant issues.

        It comes down to this.
        All was good and dandy when the music was playing, the dance floor was full, and there was plenty to go around. Now, the music has stopped…. and the music can be described in one word.
        GROWTH…. and it is over.
        What we witnessed in the brexit vote is nothing more than a contractionary impulse and is the first of many. We really do live in interesting times… incredible actually….. we have front row seats to the commencement of a great unravelling of unions, deals, bargains, and agreements… centuries in the making.

        Welcome to the age of msilabolG………that’s globalism backwards.

        It should be noted that the only biological organisms that successfully group in large numbers are those that employ anarchy as a social structure…… see D Orlov for an accurate interpretation. We as humans do not employ this and yet we congregate in ever-increasing numbers that appear to be inherently unstable ( unless distracted) ……so we get the swings from left to right and back again…. getting fleeced from one side , then fleeced again on the other. Maybe that’s why we are called sheeple?

        Il’l add that the vote ( in the near future ) will likely be taken from some… or many….. if the interests of the powerful ( they are not ‘elite’) can be continually challenged by the peons….. and that is when it gets really interesting.

  13. Brexit: Why I tend to be supportive of it, even if I don’t think it will necessarily deliver the outcomes those voting for it may want

    OK, the rant I posted on the Brexit thread the other day may have seemed a tad Libertarian, and I am doubtful about what the Poms may do from here. But what I support, and will continue to support, is the right of peoples anywhere to voice their grievances. If that voice is cornered into a position where it is voiced in a form which looks to many like small minded xenophobia, or is suppressed and unheard, then I would always take the voice. Suppression is subjugation, subjugation is denial and totalitarianism.

    Focus on the punters and their malcontents

    Let me say from the outset I too am doubtful about Boris Johnson and Nigel Farage. But just the revolt they have led will tie them more closely to those who have voted in favour of Brexit, than those whom they have beaten were to a nation which has genuinely surprised both its leadership and (more disturbingly) the global financial system – I actually suspect the least surprised were those at the core of the EU, whom I am reliably told looked at the early result from Newcastle and knew they had major, major problems, well before the result was beyond doubt.

    I buy the line that the voters for Brexit were the less educated, the poorer, the older and the most ‘threatened’. What I find myself wondering is why those in power with the funds and with the access to address the education, the poverty, and the ‘threat’ didn’t pick it well beforehand and address it (for a fraction of the cost it will now incur). OK if they have voted on issues associated with immigration, then that is distasteful, but that vote should be considered in the context of how much power they have to deal with it and what that immigration means to them in their eyes. It isn’t as though the Brits haven’t taken countless millions of migrants, is it? I played cricket in the UK in teams composed of almost nothing but Pakistanis and Indians, and I worked in places (including banks) where everyone was from somewhere else. It isn’t as though there isn’t a long history of migration into the UK which has ultimately panned out just fine. If migration is the issue there is something about this particular type of migration as it has been experienced in the recent past or currently, which is aggravating it. It isn’t immigration per se. I think the claim about anti-immigration being the basis for the Brexit vote is a convenient front (even where it has been voiced by Brexit voters themselves), for not delving into (and addressing) a whole range of social issues which may have been impacted by immigration, but which the body politic hasn’t wanted to touch, or hasn’t thought was significant enough to address.

    The vote was about economics primarily

    Mostly I see it revolving around poverty. If not direct poverty of people, then the risk of poverty, and the poverty of opportunity for people to address their circumstances. You can see a lot of it in the UK. I lived there two years more than 20 years ago, and was surprised then at just how accepting the British were of the poverty in their midst, my regular trips back never brought me to the view they were doing something about it (even at the peak of ‘Cool Britannia’ you only had to go somewhere outside London or the centre of the newly gentrified centres of larger cities to see very confronting poverty). From there I tend to see the Brexit vote as simply an avenue for expressing public discontent about poverty. The migration issue (such as it has been played) has essentially been played along two avenues – migrants compete for jobs (particularly semi skilled or unskilled jobs) and tend to have the effect of suppressing wages, and migrants represent a further social welfare spend requirement (and in the UK it is a pretty parsimonious spend). Ultimately the immigration (and I certainly don’t think all/most Brexiters voted on immigration grounds) functioned as a subset of economic policy. And it is here that the UK body politic has failed, and that (most importantly) the EU has shown itself to be utterly powerless to provide a better economic backdrop for its people over the last 10 years (at least), if it is not a genuinely worrying socio-economic threat in its own right.

    I think the Brexit vote revolved around economics, was the first remotely plausible opportunity many Brits have had to deliver a message about economic policy as they receive it in a very long time, and was rightly identifying that the EU has been a spectacular economic failure for many people living there, and has shown itself as an institution to visit financial and economic hypocrisy on an epic scale (to the people of Greece, to the savers of Cyprus, to the workers of Spain or Portugal, or the taxpayers of Eire for starters – but in countless other ways – in the interests of upholding the rights of bondholders and mainly German and French banks, against the backdrop of EU monetary policy serving Germany first and other parts of the EU second). And it is that right to protest that I support entirely, unreservedly. Against the backdrop of a world which has increased the take of the 1% for more than a generation the real tragedy of the Brexit vote is that nobody has gone to that 1% and suggested they need to reverse their take or there are likely to be societal consequences, and that not addressing these concerns is, beyond a certain point, laying the basis for protest, for revolt, and ultimately for some serious ugliness. Some sort of deal could have been nutted out which would have cost far less than the trillions being wiped off markets as those markets reprice the possibility of policy and social revolt.

    Epic level cock ups

    I think there are two epic level political cock ups underlying Brexit. The first was that the British body politic would offer a referendum on a foreign affairs or powers of Westminster v Brussels issue without realising it would be primarily (in the context of mainstream bipartisanship on most economic settings in the UK – invariably revolving around conservative trickle down economics based on discredited DSGE and efficient markets thinking) used to deliver an economic message by people who don’t usually get the chance to throw a political spoke in the policy wheels. The second was that the EU (of any organisation!) which could conceivably not get that this would be the basis of the response to them. Do the players of the EU think that the Pom Brexit crowd are likely to be any less charitable towards the EU than the unemployed of Spain, or Italy or even France, or the savers of Cyprus, or the taxpayers of Eire?

    Where to for the Brits?

    I don’t think that Johnson is, in a social, or underlying assumptions context, any different from much of the UK conservative party. He is a privileged, self-entitled git. More to the point I don’t particularly doubt that he has picked up the Brexit (anti EU) idea as a source of personal power for him (his path to the British Prime Ministership). But he at least has picked it, he has identified that it was a phenomena that was there, and that it was of a magnitude which was significant. The vast bulk of other self-entitled gits in the echelons of British politics (both sides, the British Labour Party is every bit as prone to Euroscepticism as the Tory side) and the British corporate world (or ‘the establishment’ as it likes to think of itself) are obviously so isolated from the punterariat in the nation they run as to not even get that far.

    But if Johnson now assumes power on the basis of Brexit, then he has to deliver outcomes to the people, who have voted in protest for Brexit. And the party he (will?) lead, and the Labour Party in opposition if it wants to return to power, now must deliver outcomes to those people, or run the risk that they will be the next political emasculation. The corporate world in the UK will now find itself revisiting a lot of assumptions (starting with the cost of funds – the most massive cock up of all must surely be the complete and utter failure of global markets to price the Brexit risk) and possibly even working harder on delivering an outcome (or possibly selling an outcome they already provide) about jobs, about skills about remuneration and living conditions for the ‘stakeholders’ they have ignored for a generation – those they employ. But only if they get the chance, and given the path they now face that chance may not offer much scope for better outcomes. I agree completely that anyone in British politics will be profoundly careful about putting something to a vote again in the near (think decades) future – the memory of the Brexit vote will haunt politicians (and not just in the UK) for a long time.

    The example the EU needs to make of the UK

    Unfortunately for the UK (or the English and Welsh, because I suspect the Scots and Northern Irish will want out) the EU now needs to make an example of them, and it will try to do so. Sure, the Poms have their own currency and institutions, and that will help them to some extent, but the motivations of the EU will be broadly the same. Anyone wondering about the example which will be made need look no further than Greece, where the EU has shown itself perfectly prepared to trash life as the Greeks know it to preserve the EUs self-interest. But equally they could look at the way the Irish state was backed into backing Irish private banks when it was obvious they had ceased to be solvent, and the subsequent taxpayer impost stemming from that. Or they could look at the Cyprus bank deposit raid, or some of the chicanery around pressuring Spain and Portugal. While these were no doubt a significant factor in the distaste many no doubt felt for the EU (and I do tend to the view that the Brexit vote was ultimately about economics and the EU), they now become the starting point for negotiations between the UK and EU. The EU could shunt Varoufakis out the way and get a complete reversal of policy put to (and voted for by) Greeks, with the prospect of a return to the economic stone age. They could do the same in Cyprus. Now they need to send a message to a range of irredentist groups across the EU about the implications of voting out (or even trying) with a real model of a nation which has voted out – they need to send the message of there being no way out but the economic isolation and economic impoverishment of anyone trying (or even thinking) out. That is if one assumes that there will not be frantic negotiations to try and keep the UK in the EU in some guise, and therein lay the balance the EU needs to come to – do they try and retain some sort of sway over the UK, in some form of loose arrangement (and hope that nobody else wants it) or do they provide a living breathing economic example of the price to be paid for voting out? I reckon the latter will be the longer road, but I wouldn’t be at all surprised if something was at least tried beforehand.

    Presumably that will make the support they offer the Scots to vote out of the UK of particular interest. They can’t really offer them more than they are offering the Catalonians to stay in Spain can they? And if they try to encourage the Northern Irish to unite with Eire what are they offering? The chance to get taxed to support a bank bailout they never were part of, which reflected a housing bubble and population ponzi of the type they have voted against as Brexiters? The Scots have almost double the per capita sovereign debt of the English, how do they explain that to the Italians and Slovenians (inter alia) whom they have pressured about their sovereign backed debts? Or the people of Finland and Netherlands who tend to have pretty dry economics? Do businesses in Northern Ireland or Scotland relish the prospect of dealing with the Euro (essentially representing German-French economic exigencies) more than the Pound?

    With the English (and Welsh presumably) there will be lots of scope for the EU to pare access to EU markets, and hence to redistribute profits or revenues to businesses inside the EU, but ultimately if they do that what else are they paring access to? And what are they paring their own business to in the UK? It may become a real issue in the financial services world where London is without doubt the preeminent financial centre in Europe. It is probably the one area where the EU could feel significant pain. More disturbingly for the EU the sudden release of London from closer EU oversight now offers considerable scope for the UK (traditionally far less inclined to financial regulation than the EU, and far more inclined to rest on property rights – where it has a vastly superior framework than anything inside the EU) to become more of a home away from home for European banks and financial institutions and reverting to its strength as a capital entrepot centre (along with the financial services and specialities London has, which aren’t matched anywhere else on the continent) and offer unrivalled scope for London to continue laundering money of dubious provenance (or desiring less visibility) from within the EU.

    The issue for the UK from here is to somehow leverage what strengths it has into coming up with a plausibly better outcome for its people – sufficient that they feel less inclined to vote against the obvious preferences of the establishment and their political elites. That is precisely the outcome the EU cannot let them have, for if they do they encourage loads of others across the continent to vote down the EU. I am profoundly doubtful they can, but if they can keep their financial and legal system intact and work out a way to tax it sufficiently to produce politically better outcomes then they may be a show. They are unlikely to do it with the outdated financial models of a previous economic era which have lead the EU (and UK) into a form of zombie economics, where a housing bubble and uber private debt is held up as vibrant economic life. It is this (question and move on from their existing model and come up with something superior) that I don’t think the Brits will do. But I do think the necessity they now face of having to try something (for the economic status quo will crumble quickly if they don’t) will lead to some interesting policy. From there I tend to the view the EU (every bit as wedded to the same economic orthodoxy) will try to thwart anything that looks like it could be a success in the UK.

    The larger implication – it’s the economy stupid, always the economy & at what point do orthodox economics and ideas revolving around efficient markets actually get questioned

    Of course the economic issue is the largest implication of the Brexit vote – the whole financial system model has been held up to question.

    The Western world has run a model since the mid 1970s exhorting (and often pressuring other nations to adopt) the use of markets (on the basis that these are efficient or superior to anything involving regulation or direct control by interests concerned about anything other than capital return). This has been in the experience of most people the adoption of trickle-down economics, and of the increased perception of people as subservient to the interests of capital (through a focus on those people as customers rather than a balance between producers and customers), with the people often accorded a legal status in market economies akin to that of a chattel. Generally this has been without the slightest question being asked about the provenance of the capital, and how it has been acquired in the first place, and of what it may do in any destination it desires. It has been supplemented by the extension of debt which is generally priced solely to provide a return to those extending it, without considering other economic impacts (asset bubbles, intergenerational transfers, economic efficiency, production costs etc), and generally on the belief that markets simply don’t fail when it comes to pricing debt (regardless of the spectacular examples on offer around the world suggesting that it does, and does so regularly). Britain was central to the advent of that model, after the spectacular failure of Keynesian inspired economics in the mid 1970s, courtesy of Mrs Thatcher, and her successors (both Conservative and Labour), the big bang of the City in the late 1980s, and London’s preeminent position as a financial centre.

    Since the 1970s this has seen the increased concentration of capital in fewer hands across nearly all developed economies, all developing economies and in the former centrally planned economies. It has also seen the widespread indebtedness (both public and private) of whole societies, and the marked deterioration of the bargaining position of labour vis a vis capital. In many respects the UK has been at the forefront of this (probably surpassed only by the US).

    The limits of the model

    I tend to see the Brexit vote, and the rise of the Trump (and Sanders) phenomena in the US as political symptoms of the limits of the economic role model we have experienced for a generation.

    Currently that economic role model has an economic zombie of Japan and the EU, the economic marginalisation of much of the US, an ominous debt implosion prospect in China, the denial of some pernicious money acquisition processes across the developing world (from the Middle east to Russia to China and onto most of Africa and South America) and has devolved into the politics of impotence and shrill small (or non insofar as much of the electorate is concerned) issue bitterness across political spectrums around the world. In Australia it has seen the marginalisation of the young (and I reckon young in that sense is anyone younger than about 50) and the stripping of economic vigour to facilitate a housing bubble and debt explosion. That model has ceased delivering real outcomes in many nations some time ago, and replacing the real outcomes have been spurious and specious words – by politicians, by corporate elites, and those who have a position ‘at risk’ from any process of looking at new models. Many of the elites who have come to power in the age of this model and whose power is deeply embedded in the functioning of this model, have no other intellectual answer, and lacking any other answer need to suppress questioning of the model whatever way they can. That of course leads to the voice dispossessed, and loads of politically unacknowledged messages, which can’t really do anything to get addressed but become more and more obnoxious (and where they do become obnoxious they enable the state to openly crush dissent one way or another).

    The near death experience

    That economic model has had one near death experience in 2008. Since that time it has been living on life support as central banks have delivered transfusion after transfusion of cash into the system to keep it viable or plausible – even though most observers have long thought it less plausible than the politburo standing on Lenin’s tomb in 1983. Like the Soviets of that era the system runs long on an ethos of ‘the system is eternal and there is no other’. Unfortunately those transfusions being pumped into the model since 2008 (at least) have been haemorrhaged out as easy money for those with access to debt, and these have in turn have haemorrhaged it out again on asset bubbles (notably real estate) rather than doing anything much productive with it – mainly representing the informed fear that a generations worth of debt saddling has curtailed the worth of investment in productive endeavour, and making speculative gambling on whatever asset class seems doable a less risky venture. They have been able to do this because the model they are doing it under sees regulation (particularly financial regulation) as anathema, and is wedded to the idea that where there is money it will do the most efficient thing, which in turn is always to the best interest of the society in question. The idea that money provision wouldn’t ‘work’ in terms of delivering better social outcomes wouldn’t enter the head of those exhorting the model. The idea that large sections of society have missed out in some way must surely represent, for these people, the idea that there is something ‘wrong’ with those who have missed out. And so it is here – Those voting Brexit are wrong, uneducated, anti globalisation, racist lowlives many of the commentariat would have us believe.

    The Brexit vote and the repricing

    The Brexit vote has delivered a message to those living at the limit of that model. It has raised the bar for those looking to continue the operation of the model inside the UK, and will deliver a warning to those seeking to extend the model in the EU (as well as raise the costs for them). More disturbingly it puts the rise of Trump (whom I loathe) into a context where it may make sense to many people in the US to vote a nutter into the White House, rather than a scion (Clinton) of the model as it has run for a generation (particularly where she is the very embodiment of the sort of speciousness and glib literality of the type which people around the world have increasingly been seeing in their political elites as the model has ceased to deliver economic outcomes).

    But perhaps the most truly spectacular outcome of the Brexit vote, is in the complete misreading of the sentiment and issues at play by the global financial system. The Brexit vote requires the entire political economy of the globe to be repriced (as it will be in waves of volatility over the coming weeks and months). It surely will lead in the coming days to a complete repricing of the Trump phenomena. Indeed it must invariably lead to a repricing of the possibility that many of the underpinnings of the model which has run for a generation will be revisited, when the hitherto assumption was that they never really would be (often because there was no political vehicle to carry that sentiment). More disturbingly for the EU it now must invariably lead to the repricing of EU related risk, or the costs involved in ensuring that the ruling elite there don’t get called out this embarrassingly again. For at the end of the day this was a nation which has voted against being a member of the EU, when the elites of that nation, and the elites of the EU assumed the benefits of the EU tie for the UK were obvious. Brexit implies a repricing of the obvious, which means a revisiting of almost everything in an economic policy sense.

    The cojones and the Poms

    For that reason I support the Brexit vote. I support the rights of people who do not believe their leaders listen to them, or who do not believe their leaders address their circumstances, or do not provide them with much of a choice in the address of those circumstances, or even (in the worst case) hold their hopes of addressing their circumstances to ransom, for a rent, to do whatever it takes to have their issues addressed. Regardless of whether the vote will be a step towards a better future for the Brexit voting Brits, I admire their bravery. I admire their cojones in facing up to an elite which has told them repeatedly that they either ‘suck it up’ what they are given (or what they aren’t given) or face a dire alternative, and saying to that elite ‘we will take the alternative’. Yes I think they are taking an enormous risk, but I think the world has reached the limits of the economic model we have run for a generation and needs to start taking some risks. Regardless, I think that the process of repricing and revisiting policy assumptions which I think will flow on from Brexit will lead to a greater focus (or pricing analysis) of the circumstances being experienced by many who have been marginalised – and I think that offers scope for the improvement of the lives of the many (no matter where they are) rather than the 1% who have soaked it up for a generation.

    Gunnamatta 25 June, 2016

    • “London is without doubt the preeminent financial centre in Europe” and this pisses Brussels off no end.

      Naked Capitalist ran a story tonight http://www.nakedcapitalism.com/2016/06/87726.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29
      According to the Lord Ashcroft Pools the Brexit vote hinged on sovereign identity, although the n is 12000 so could be skewed I guess. But I think common people are waking up to the neoliberal agenda and imo they are going to give our election a similar shake in SA where the X factor is lining up for three seat in the reps and similar in the Senate. Come on 2 July!

    • Paddy Finucane

      Beautifully put Gunna,

      I voted remain in the end. Farage and Johnson are fakes, but you are right everyone is a fake and everyone knows the model aint coming back. It is fucked.

      But I am wondering a guy who told me he was happy to be out of writing for a crust would slap out 4 thousand words on a Sat eve in Geelong. That is a very good read. I could probably get that published if you want.

    • Very glad that you cleared up our concerns about some signs of Libertarian tendencies!

      We were getting worried.

      Very good but don’t think the EU as an alliance of neoliberal ideologues and old-school technocratic/bureacratic socialists will take this act of rebellion lying down.

      The EU has a proud history of forcing people to keep voting until they vote for what is good for them.

      Already, a fraction of the 48% are out and about demanding that there be another vote and a few have noticed that the promise of an immediate Article 50 notification has been postponed to some future date.

      Such drama over a decision to leave a protectionist, exclusive trade bloc with a history a mismanagement – most particulary a diabolic anti-democratic common currency zone.

      In essence the EU threats amount to –

      “If you leave we will treat you like Australia and all those other countries in Asia, Oceania, South America and Africa that we also discriminate against whenever we can”

      There is absolutely no reason why the independent countries of Scotland, Wales, England and Northen Ireland (whether in or out of the UK) cannot participate (trade, movement of people) in the broader community of European nations WITHOUT being locked into the club and having the terms of that trade and movement dictated by Brussels.

      Australian and many other countries do it right now. The EU is one of our larger trading partners. So not having club membership is not a complete barrier to entry. We allow lots of EU passport holders to travel and work in Australia even though we are not members of their club.

      We even sing at Eurovision.

      The nasty and vicious language coming from the EU and all their threats are exactly what was dished out to the Irish, Spainish, Portugese, Greeks, Cypriots etc over the last few years. Funny how the EU rules did not apply to the Germans and French when they were blowing deficit smoke in the early 2000s.

      The British have done Europe a great service telling the EU to get rooted BUT they are not free yet.

      Expect a fierce compaign to block their exit by the coalition of neoliberals who like massive corporate owned rent seeker supporting states and those paternalistic big government lefties who reckon if we just let them shuffle paper and call the shots and not bother them with questions from the “little people” we will be perfectly happy driving around in a new model Trabant.

      Ironically, though not unsurprising the most important part of exiting the EU has not been discussed by either side and that is ending the unproductive international capital flows that are the primary tool used by the centralisers (left or right) to oppress and coerce and colonise diverse populations.

      The EU should be happy to be cutting off the City of London as they can let the German and French banking systems divide up the EU spoils but there is risk in doing so because once one region starts to block international unproductive capitals flows others might get the same idea.

      Plus what if the international bankers in London and New York started tempting away other members of the EU with promises of easy credit.

      Never been a better time to be a skeptitarian.

      AND there is a massive warning in all of this to Australia.

      Leaving Mr Robb’s and Mr Howard’s FTAs may prove just as difficult as in essence the EU is just a more advanced FTA.

    • OK, the rant I posted on the Brexit thread the other day may have seemed a tad Libertarian,

      I was just thinking to myself, Gunna’s coming around, Gunna’s coming around…. we’ll need to reserve a prominent spot for Gunna in Galt’s Gultch….And you go an ruin it all with well thought words, when you of all people knows that Libertarian-ism is at it’s core just an emotional crutch for the intellectually disabled.

    • Great insights Gunna.
      The flaw in the economic model can be summarized in a couple of words: the inability of leaders to be equitable.
      This economic model and its main flaw are now global. A few nations might be doing a better job at distribution of capital (thinking here of some of the Nordic countries), but overall it is wall-to-wall chicanery with the 1%ers pulling the levers.
      The desire of the plutocracy and vested interests to create an economy built on a fault-line of inequity is always going to be a recipe for disaster. Those who benefit from the current system will try to keep the game going a little longer, with financial punishment their chief weapon of ‘persuasion’. Author Naomi Klein has written extensively on this process – Disaster Capitalism.
      If more and more people awake to how it is they are being duded by the process, protests will increase and an alternative to the current paradigm must necessarily appear. Whether that is a wholesome alternative or unholy one is the question, and that will influenced by the lead taken by the current rule makers. If the 1%ers are prepared to relinquish some power there is the possibility of a peaceful transition to a more equitable environment.

  14. drb1979MEMBER

    SCOTLAND now making noises about talking to the EU regarding their membership. All 27 remaining countries have to agree to start formal talks with Scotland, which Spain is unlikely to agree given it may encourage their own separatist movement. Probably a few noises from EU parliament and Junker but nothing formal can commence without agreement of all EU members

    (and as UK still technically member, as it continues to pay in, it too can technically veto talks with Scotland commencing however I doubt it will)

    Synopsis of Scotland leaving UK;
    Scotland will lose billions of annual subsidies from UK government(the “barnet formula”)
    Scotland will have to pay in money every year once a member of EU
    Scotland will have to spend billions to fund defence/foreign affairs
    Scotland will have to pay its share of UK debt
    Scotland, due to massive structural deficit, wont have low borrowing costs
    Scotland will have to commit to joining Euro
    Scotland will have as much influence in EU as Luxembourg given its tiny population

    Not going to happen.

  15. 2 million Brit’s have signed a petition for another referendum.

    The youth are revolting, against their own interests. Seriously, how can Brexit be twisted into a bad thing for Britain’s youth?

    The elite are super rich because they’re master manipulators.

    • The young have always been attracted to the promise of the BIG solution whether it is on offer from the left or right.

      The EU is a project has plenty of elements of both. It is appealing to the finance and corporate statists who see endless rent seeking and market conquering opportunities and it is appealing to the utopian technocratic bureacrats who believe that they can build us a perfect world if only we leave the job to them.

      Young people are not impressed by the smaller scale, complicated and local. Of problems that have no lasting solutions but remain works in progress of gradual and ongoing acheivement.

      The vision splendid is a young person’s folly.

      • Pfh Youth lack wisdom IMO. They give away a whole lot for very little. Trouble is they only see the gain.

      • ErmingtonPlumbingMEMBER

        Yes, the Young eventually Grow up and many even become less self-absorbed,….its amazing how having kids can do that to ya.

        In our Comsumerist society though, powerfull force’s of propaganda are always washing over us, trying to prevent us all from growing up and taking responsibility for something other than a thing or experience that we want.

        So what that these young pricks have to stand in a visa que when on their way to a drunken Ibiza [email protected] fess.
        As pathetic as senior citizens complaining anout the high cost of Rolling Stones concert tickets,… how [email protected] old is Jagger now?

    • The snippets I have read of young people complaining is that they more concerned about their ability to freely travel around Europe, not of any hard economic reasons.

      • Yeah okay thanks.

        Surely the UK can negotiate limited visas for travel like Australia have. I don’t see too many Brits in Europe other than holidayers.

        What do you think?

      • ErmingtonPlumbingMEMBER

        From Mining Bogans post above.

        Australian-born UK resident Elliott Rossi, who works in marketing, said he had spent the past 10 years trying to obtain Italian citizenship so that he could stay anywhere in the EU.

        “Starting in Sydney and then moving over here on a British visa and getting Italian citizenship, I felt like I’d just been given the big middle finger by the entire country. I was horrified, absolutely horrified,” he said.”

        Yes id like to give Elliott the big middle finger too,…. winging little grub. I hope he doesn’t return.

  16. “Brexit: ‘Not a good day for the Western world’ say Aussie business leaders……It seems to highlight an increasing level of individualism in society where people are only focused on protecting their own selfish interests rather than the greater good and interests of the wider community,” Mr Mullen said. “It’s not a good day for the Western world.”

    I see it exactly opposite to what he has said. Those anti globalisation/corporation hairy hippies decades ago were the smartest. They saw what was coming first.

    • Many of these business leaders don’t live in the real world though. They live in bubble, much like the Liberal politician (Ciobo) on the tv right now telling me how great globalisation is and how i don’t understand how good I have it!

      They don’t get, or care about the increasing number of us that have insecure jobs and can barely afford basic things like rent. Ciobo is going on about how good things are under the Coalition, and how many jobs they’ve created, yet many of us are underemployed. Hell, it was much easier To get work under Labor than it is right now. That might be because of the economic cycle rather than who’s in power, but I don’t like being told how great things are by some smug out of touch politician.

    • A good little read. It made me think that now is a good time to get my own religion up an running. Nachos shall be my holy food. The holy text shall be Hubert Selby Jr’s ‘Last Exit to Brooklyn’, and all bicycles shall be fwdmbb like the Cruzbike. The song of praise is Andy Prieboy’s ‘Build a Better Garden’, the demo version. All sports people get paid the median wage, and administrators of said sport get 90% of the median wage. Those found guilty of corruption, something needs to happen to them. I’m open to suggestions.

      http://cruzbike.com
      https://m.youtube.com/watch?v=2-dx9KaTKxE

    • Its important to distinguish debt according to is quality and not just lumped together as one big sum – as some are want to do. Now how much debt was created with risk tools which magically lowered their risk profile, via slight of hand, and enable more debt creation than would have been otherwise possible, additionally how much of the jumbo / prime debt is subject to impairment because of the forenamed.

      Disheveled Marsupial…. the most concerning aspect is what was/is the purpose of it – ???? – socially productive or per pre GFC a tide that lifts all boats and then goes poof…..

    • interested party

      All good links and they help to colour the subject….. yet they all fail in the simple observation that this whole event is a symptom of the end of growth. Spence talks of a failure of the system ” growth patterns and policies that seem to benefit those at the top disproportionately.”
      This is a simple observation. When growth retreats the strongest will stand longer than the weak and so will be more visible…. and therefore become targets of less fortunate folk.
      The credit bubble bulletin focuses on the financial side of this event and more so on the global system…. zip on the end of growth.

      All the problems we face now and will face in the future have been and will be spawned by out of control growth… in all things financial, economic, and environmentally destructive…. and they will only be revealed in all their splendour by growth stalling or reversing and the beneficiaries of that growth suddenly realizing that the free lunch is over…. and so we get brexit and it’s brothers soon/yet to be born.

      Edit to add….
      I have no dog in this fight. What the Brits do is all part of being human and there is really no right or wrong path. It just leads to the next sequence of events. I just note that humanity seems to be struggling with the end of growth, and will do what a neutral observer may think of as a form of self-harm but in reality is just a small part of a much larger process.

      • Brexit was championed by snake oil salesmen that managed to convince a lot of British people that the EU is the source of all their ills. This message played very well in the minds of those that have a limited capacity to understand the complexity and rapid changes in today’s world (as highlighted by the demographics of the vote). The British will emerge from this and find themselves with some of the same problems that led many of them to vote for Brexit; on top of a multitude of new problems that they did not envision/anticipate as a result of this vote. At the end of the day, it’s tradeoffs that people have to make. No one is saying the EU is great, but one has to look at the cost of the alternatives. Right wing governments in a divided xenophobic Europe is not the answer and major decisions built on fear and lies and affecting generations to come is not smart.

      • interested party

        Can you fill us in on what the source of all their ills is then? It would appear that they reached a point of enough is enough and since the governing body for the EU is Brussels, and there they live a life of extreme affluence where as the people of “limited capacity to understand” surely recognise that the life they live is not in the least bit affluent, then it stands to reason that given the chance they would choose to leave. The fact that more voted to leave speaks of inequality passing critical mass.

        You mention the cost of the alternatives. These costs cannot be calculated as they are yet to be seen but no doubt there are costs to be faced. What the people do know is the costs they are paying now and they can see the money flow to the top. I am not surprised by the outcome in the slightest. I expect more of the same.

        Your fear of a divided Europe is valid. The world is coming off a massive credit high, and most people won’t accept life on a lower rung of the socioeconomic ladder without lashing out at someone.

        “the minds of those that have a limited capacity to understand the complexity and rapid changes in today’s world” ……. consider this. The finance sector must be included in this cohort. They have mis-priced risk countless times and have therefore exhibited a limited capacity to understand the complexity and rapid changes in today’s world….. so on that count I don’t buy that comment.

        This is a predicament that will have an outcome. It is not a problem that has a solution. The end of growth is a mathematical inevitability and this is one event in that process.

      • The Brexit referendum meant different things to different people, that’s the problem. Was it about economics? sovereignty?, inequality?, uncontrolled immigration? refugees? or giving the one finger to the top 1%? all the above? Every one seems to see it based on his/her view of the world. How many of the above reasons will be remedied by Brexit? that’s the question. My view is not much (except for more controlled migration/refugees). Central banks will continue to do what they do, the far right (once in power) are not going to become the champions of workers rights, factory workers are not going to get back their jobs, poverty in Britain is not going to be eradicated.
        I agree with you that the “growth at any cost” is wreaking havoc everywhere and I would not be surprised to see a “reset” of the whole system at some point, but that’s not what was driving the Brexit vote (based on the evidence of the vote demographics).

      • The Brexit referendum meant different things to different people, that’s the problem. Was it about economics? sovereignty?, inequality?, uncontrolled immigration? refugees? or giving the one finger to the top 1%? all the above? Every one seems to see it based on his/her view of the world. How many of the above reasons will be remedied by Brexit? that’s the question. My view is not much. Central banks will continue to do what they do, the far right (once in power) are not going to become the champions of workers rights, factory workers are not going to get back their jobs, poverty in Britain is not going to be eradicated.

        I dont think that anyone thinks the Brexit vote fixes any of that. What the Brexit vote does fix (or starts to fix) is that the elites of this world can deny or ignore (to the punterariat) that address is required of an awful lot of issues which have been swept under the carpet under the general idea that the economy is doing swimmingly (and that malcontents are so few they should be ignored/marginalised).

        Either they address the issues, or work out how to deny punters a vote/say in the running of the place (in however minor a form)

      • interested party

        I have not made myself clear…. my apologies.

        “Growth at any cost” is not what I have expressed….. that is the cause of the predicament we are in.
        What I am saying is that the social undercurrents that gave rise to the circumstances for a vote to take place…either rightly or wrongly….. are due to the limits of growth being reached or recently passed. This situation would have presented itself in some other country if not the UK. The far right that you speak of only exist to feed off the mood of the people, and that mood is governed by opportunity or the lack of…. and that opportunity or lack of is driven by growth.

        I submit to you that the drivers of the vote that you listed are just symptoms of the larger issue and that is growth is over….. debt based, economic based, everything that requires more inputs than it outputs. What has been was unsustainable…… and that means there is a downside. We are at that point.

        Gunna

        How can they address the issue if it is bigger than humanity. As I have stated elsewhere today, we are living through the effects of a mathematical certainty and yet how come people cannot see this?
        Maybe it is the speed of modern life that stops most from stepping back and looking at the big picture.

        Note that your ‘malcontents’ seem to have hit critical mass and can now affect results.
        That raises a few questions regarding the future….socially in particular.

      • interested party

        “How many of the above reasons will be remedied by Brexit? that’s the question. My view is not much (except for more controlled migration/refugees).”

        I agree and will go further. Nothing will be fixed….how can it be when you consider that they are all symptoms of the larger predicament we all face. You can quote me on this…… we will witness some things that will be very disturbing in the next decade or so, and that will be the result of people/groups/nations thrashing about in vain attempts to revive the past when that life has been consumed and now sits in some bank account that has some oligarchs name on it. And we cannot really complain about that outcome because we all tore off into the future believing it would last forever…. and now we will forlornly pine for the past but that has gone under the bridge.

    • Yep, the global punterariat, emboldened by the punterariat of the UK telling their elites to shove it.

      Find their sports fest is stuffed because the elites corruptly sorted out to send it to somewhere incapable of holding it.

      It is going to be an entertaining Northern Summer. Greece is back in negotiations mode for the next tranche too, there is the US Presidential elections,

      All we really need now is for there to be a new round of accusations about FIFA or about the global cricket body (or even a power failure in the Rio broadcasting centre)

      Anyone know some good effigy makers I can invest in?

      • Sent to me by a mate – not sure the origin

        “Brexit to be followed by Grexit. Departugal. Italeave. Fruckoff. Czechout. Oustria. Finish. Slovakout. Latervia. Byegium, Swexit, Polapse”

    • FiftiesFibroShack

      Rio looks like it will be such a shambles that an idea might be to announce there will be no drug testing whatsoever. Let’s see what the human body combined with modern science – unshackled from the tyranny of regulation – can achieve…

  17. Brexit is turning out to be everything to everyone.
    If you’re worried about the unsustainable levels of immigration, then Brexit is for you
    If you feel marginalized by the system then Brexit is for you
    If you miss the glory days of the empire, then Brexit is for you
    If you’re a racist xenophobic backward looking bloke, then Brexit is for you
    If you have grudges against the bankers that brought us the 2008 crash, then Brexit is for you
    If you’re unhappy with NATO expansion, then Brexit is for you
    If you’re unhappy with the way Greece was treated by the EU, then Brexit is for you
    If you have a problem with central banks, then Brexit is for you
    If you’re one of simpletons whose moto is “Let’s make …fill (country) in the blank… great again”, then Brexit is for you
    If you believe there’s a simple solution to a complex problem, then Brexit is for you
    Hell, even if you’re none of the above, but you woke up unhappy on June 23rd, then Brexit is for you
    This is what happens when a desperate PM decides to make people vote on a decision that has enormous consequences for generations to come, just so that he can cling to power. Done in a context of economic stagnation, worst refuge crisis since WW2, technology and outsourcing disruptions on a scale never seen before.
    This is a referendum that did not have to happen. At least not now and not against the backdrop of all the shit that’s happening around us which clearly has clouded people’s judgments.

    • We definitely have to stop these ordinary people loons having a say in what happens. Government needs to be left to people like us who know everything.

      • Don’t worry, when the far right is in charge (thanks to Brexit), we’ll find out how the “ordinary” people are doing.

      • No, I’m saying it was a miscalculation on the part of Cameron to remain in power and not an exercise in democracy. Referendoms of this magnitude need better checks and balances. See links from project syndicate above.

        A country should not be making fundamental, irreversible changes based on a razor-thin minority that might prevail only during a brief window of emotion.

      • interested party

        It may well have been a miscalculation on Camerons part, yet there is an aire of inevitability about this whole process. This release may well prove to be less traumatic than a later more virulent release.

  18. Does Rogoff remember that the 75 Referendum about remaining in the EEC was also an ‘in or out’ affair? It decided ‘in’ yet none of the suggested followup actions Rogoff ‘insists’ are necessary to validate Democracy were done back then either!
    I’d suggest that if Friday’s vote was run on anything but the same basis as the one back in 75, with only 64% of the public voting then, then Democracy is certainly not being observed.
    ” Labour’s manifesto for the October 1974 general election promised that the people would decide “through the ballot box”
    So similar to today’s process with a different political party trying to remain in control and the irony being that those least in favour of Europe back then, were…The Scots!

    • edit: You beat me to it Janet. I would have liked to ask Rogoff and Co of the global FIRE sector mafia and political associates why the massive yes vote for the EEC in 75 has shrunk to a minority vote 41 years later? This must mean a lot of enthusiastic Yes voters of then have become thoroughly disenchanted. And why do the elites like him want to change the rules when the outcomes go against their wishes? Oh poor Rogoff & Co, is your weltanschauung falling apart?
      A vote for the EU is a vote against democracy itself; the founders of the EU deliberately built it on anti-democratic foundations. Those who think that the EU can be democratised are fools.

    • Rogoffs article is deeply undemocratic. As has been most of the commentary that the leave vote was motivated by fear and ignorance. What does that really imply? That an individual’s vote should be weighted according to their formal education and wealth.

    • EU equals…. Ordoliberalism…. is the German variant of social liberalism that emphasizes the need for the state to ensure that the free market produces results close to its theoretical potential.

      “Theory

      Ordoliberal theory holds that the state must create a proper legal environment for the economy and maintain a healthy level of competition (rather than just “exchange”) through measures that adhere to market principles. This is the foundation of its legitimacy.[8] The concern is that, if the state does not take active measures to foster competition, firms with monopoly (or oligopoly) power will emerge, which will not only subvert the advantages offered by the market economy, but also possibly undermine good government, since strong economic power can be transformed into political power.[9]

      Quoting Stephen Padgett: “A central tenet of ordo-liberalism is a clearly defined division of labor in economic management, with specific responsibilities assigned to particular institutions. Monetary policy should be the responsibility of a central bank committed to monetary stability and low inflation, and insulated from political pressure by independent status. Fiscal policy—balancing tax revenue against government expenditure—is the domain of the government, whilst macro-economic policy is the preserve of employers and trade unions (Funk, 2000, pp. 20-1; Dyson, 2001, p.141).”[10] The state should form an economic order instead of directing economic processes, and three negative examples ordoliberals used to back their theories were Nazism, Keynesianism, and Russian socialism.[11] The Ordoliberal idea of a social market economy is often seen as a progressive alternative beyond left and right[12] and as a third way between collectivism and laissez-faire liberalism.[13]

      While the ordoliberal idea of a social market is similar to that of the third-way social democracy advocated by the likes of the New Labour government (especially during the Premiership of Tony Blair), there are a few key differences. Whilst they both adhere to the idea of providing a moderate stance between socialism and capitalism, the Ordoliberal social market model often combines private enterprise with government regulation to establish fair competition (although German network industries are known to have been deregulated),[14] whereas advocates of the third-way social democracy model have been known to oversee multiple economic deregulations. The third way social democracy model has also foreseen a clash of ideas regarding the welfare state’s establishment, in comparison to the ordoliberal’s idea of a social market model being open to the benefits of social welfare.[15]

      Ordoliberals are also known for pursuing a minimum configuration of vital resources and progressive taxation.[16] The Ordoliberal emphasis on the privatization of public services and other public firms such as telecommunication services;[14] wealth redistribution and minimum wage laws as regulative principles makes clear the links between this economic model and the social market economy.[17]

      Wilhelm Röpke considered ordoliberalism to be “liberal conservatism”, against capitalism in his work Civitas Humana (“A Humane Order of Society”, 1944). Alexander Rüstow also criticized laissez-faire capitalism in his work Das Versagen des Wirtschaftsliberalismus (“The Failure of Economic Liberalism”, 1950). The ordoliberals thus separated themselves from classical liberals[8][18] and valued the idea of social justice.[19] “Social security and social justice”, wrote Eucken, “are the greatest concerns of our time”.[20]

      Michel Foucault also notes the similarity (beyond just historical contemporaneity) between the Ordo/Freiburg school and the Frankfurt School of critical theory, due to their inheritance from Max Weber. That is, both recognise the “irrational rationality” of the capitalist system, but not the “logic of contradiction” that Marx recognized. Both groups took up the same problem, but in vastly different directions.[21] The political philosophy of Ordoliberals was influenced by Aristotle, Tocqueville, Hegel, Spengler, Karl Mannheim, Max Weber, and Husserl.[22]
      Criticism

      Ordoliberalism has its critics. According to Sebastian Dullien and Ulrike Guérot, ordoliberalism is central to the German approach to euro crisis resolution, which has often led to conflicts with other European countries.[23]

      Indeed, ordoliberal economist Hans-Werner Sinn of the University of Munich argues in his 2014 book The Euro Trap: On Bursting Bubbles, Budgets, and Beliefs that the “European Central Bank has become too accommodating and that its plans to buy sovereign debt are illegal”. Additionally, he argues that the eurozone bailouts during the eurozone crisis have “created moral hazard, allowing feckless Mediterranean countries to get away with minimal reforms and only limited fiscal discipline”.[24]”

      Disheveled Marsupial…. then to top it all off the vast majority of polies and unwashed have zero clue and just ascribe to some environmental bias rewarded them for some period… wheeeeee~~~~

  19. Attention sidebar Chrome extensions users! I’ve made a couple of updates, there is no longer an on/off switching function for the sidebar, now if you open an article with comments you will have a small ‘show sidebar’ button at the top right you can hit to show the sidebar instead. This doesn’t require a page refresh/reload and is just a nicer solution I think. It’s there all the time, but it’s not obtrusive. It won’t appear on the front page or on an article with no comments.

    Also, there is now a ‘mute’ feature. Previously the filter list was just used to remove comments from the sidebar. Now, if you right click somewhere on an article you will have a “Mute Them!” button in your context menu. If you click this button, comments from anyone on your filter list will be hidden from the main page in addition to not being shown in the sidebar. You can get them back (if you want to) by refreshing the page. This function is separate to the sidebar – you don’t have to be displaying the sidebar for the mute function to work.

    The new version is 0.0.0.6 and is available now, it should auto-update but if you can’t wait, right-click on the extension icon in the top bar of the browser, click ‘manage extensions’, on the extensions tab click ‘developer mode’ and then ‘update extensions now’, then turn developer mode off again.

      • We’d have to run a survey asking users of the extension how long their ‘filter’ lists are. I don’t collect any data from the extension users, I’m not microsoft 🙂

    • I dont actually mute anyone (and dont use the sidebar on my mobile – which seems to be an increasing portion of my daily MB time) – just use the sidebar to keep an eye out for those whom I think worth a read

      • Yeah, my highlight list is longer than my filter list and it’s easy to see highlighted names at a glance. I personally don’t tend to use the sidebar unless the thread is quite long (say 50+ comments), which is why I originally made it switchable. But I was never quite happy with the way it worked, I think it is better now.

    • interested party

      David, thanks for the effort you have put in. One request…. can you repost the link for others.

      • Just at the footy about to watch Hawthorn flog the Suns hopefully, will do when I get home.

      • Welp, not a great game of footy but a win is a win. Link is here for any, erm, interested parties? Note the description in the chrome store probably doesn’t exactly match the appearance any more because I haven’t updated the description this time around. The extension is unlisted so you can’t search the store for it, mostly because I figure if you’re not reading MB you probably don’t need it….so following this link is the only way to get it.

        I will probably get around to posting the source code somewhere one day (Github probably).

  20. Friday event may also influence the vote in Spain. These elections should be watched very closely as they can set the stage for France’s elections and point of no return for EU.

  21. LUCK IS RUNNING OUT FOR THE LUCKY COUNTRY

    In the lead up to the 2016 Australian Federal Election, I’ve put together a piece about the current state of play in Australia. My fear is that the Australian population is blind to the hard decisions we need to make in the future – through a mixture of ignorance and vested interests that don’t want the populace to understand anyway. Have a read through this before you cast your vote on Election Day.

    1. Australia’s success over the last 50 years has been more about ‘dumb luck’ then good economic management.

    Contrary to what the political advertising of the major parties would like us to believe, neither party is a ‘better economic manager’ than the other. The main driver of Australia’s economic growth over the last 50 years has been due to global factors – not local factors. The government departments that actually balance the books run by the same principles regardless of who is in power.

    For the post-war period through the 50s and 60s – Australia’s economic growth was based around rapid population growth that occurred after World War 2. All Western Economies grew very rapidly during this period, as the start of consumerism began. In Australia’s additional benefit, the tyranny of distance and low input factors (cheap labor, cheap land, etc.) meant that many of the first consumer goods were made in Australia. This included Motor Vehicles, Household Appliances, and commodities like Steel. Any economy that doubles its population will experience rapid economic growth by default (7.4 million people when WW2 ended in 1945 vs. 15 million by the time Bob Hawke was elected in 1983). The rapid immigration rates of this period bought millions of ‘working age’ people to Australia, and there were plentiful jobs in factories for these people to do. The societal costs of raising and educating millions of people were actually paid for by other countries – saving Australia billions of dollars. With all these factors in mind, it was not good local economic management but global factors that lead to Australian economic growth.

    Then starting from the mid-1990s we saw a rapid expansion of private credit globally – which of course impacted Australia as well. This rapid growth in private credit through higher mortgages, credit card balances, and car loans fuelled significant economic growth up until 2008. The Howard Government benefited significantly from this private credit growth expansion, because they could cut government spending producing a surplus whilst at the same time still generating economic growth. Many people falsely believe that John Howard and Peter Costello were good economic managers for the fact they produced a surplus, but given the rapid increase in private debt this was inevitable. In addition to this, for the last term of the Howard government (2004-2007) the benefits of the mining boom were starting to flow through to the numbers as well. At this point in time, the Australian economic miracle looks rosy indeed.

    Then the third stroke of dumb luck was the commodities boom that started around 2004 – based on strong international demand for commodities Australia had in plentiful quantities (Iron Ore, Coal, and Natural Gas). Much of this demand was driven by the growth of China, and the fact that global commodity prices rose rapidly at the same time volumes exported from Australia rose as well. Kevin Rudd could foresee that this was only a short term boom, and correctly proceeded to try and quarantine some of the benefit through a mining tax (funds that could be used at a later time to boost the economy during an economic downturn). Ultimately a $40m scare campaign from the vested interests in the mining industry bought down a Prime Minister, and Australia failed to save for a rainy day. There was a small blip in consumer demand leading during late 2008 that led to a fear that Australia would have a nasty recession like other global economies were facing after the Global Financial Crisis of 2007. The Australian Government incorrectly pissed away the $1,000 Plasma TV bonus to every adult in the country – an economic stimulus that that simply was not required at the time. A second burst of the mining boom happened from 2009 to 2013 – and Australia once again made significant money (masking the structural problems that an increasingly aging population causes).

    Unfortunately as the mining boom unwinds, no government of either side of politics as the balls to ‘cut the cloth’ to fit the current income streams. As a result, the government has been running significant budget deficits for the last few years – and these are projected to increase rapidly over the coming years.

    The China growth story is starting to slow, the Private Credit of Australians is maxed out, and the country now faces structural problems with an aging population. All of those immigrants that came to Australia in the 50s, 60s and 70s to ‘make Australia great’ are now in the twilight years and consuming significant portions of the Federal health budget. Without another ‘dumb luck’ boom to save us, Australia could end up as broke as Greece within a generation.

    2. Australia is now effectively a pyramid scheme

    Because of the way the economy is structured, with universal healthcare for all (with no caps on costs into old age) without an economic/mining/credit boom underpinning it – we effectively become a pyramid scheme. Over the last few years, we have become dependent on wealthy immigrants to prop up the bottom of the pyramid. They do this through buying our residential properties, our business, and in the case of rural Australia – large swathes of our farming land as well. Of course in return for ‘investment’ into Australia – these wealthy immigrants get fast tracked visa applications and permanent residency. There are very few checks into ‘how these people became wealthy’ and often we are importing people into Australia that made money in markets like China through corruption and other illegal business practices.

    Many major industries are corrupt and have too much power. The Big 4 Australian Banks make more profit than all of the banks in the US combined! Australian consumers pay some of the highest ‘retail margins’ for funds in the world (typically 2-3% above the reserve bank rate) and a Royal Commission into the banking sector is as relevant as a Royal Commission into the unions. You could take the argument further and suggest that all major industries where a small number of players have significant market power (banking, supermarkets, telecommunications) should have a Royal Commission once a decade anyway to ensure their processes are fair and free from corruption.

    Unfortunately in Australia, the Government desperately needs to keep the ‘status quo’ because they fear that their little pyramid scheme they call ‘The Great Australian Dream’ may collapse.

    3. Healthy economies have the occasional recession

    A bit like a humans liver needs a detox after the festive season, or a rose bush needs the occasional trim to flourish again, healthy economies need to have the occasional recession to flush out bad business practice. Recessions whilst painful in the short term make businesses look at process efficiency, remove unproductive people, and drive innovation.

    We should not fear a recession, and in fact we will come out of the other side of a recession in a much more healthy position. Even the great depression of the 1930’s didn’t last all that long, and I think many of us would be willing to sacrifice 3-5 years of pain if it was for the long term benefit of the Australian way of life.

    The future of our economic growth is through Australia developing products and services that are truly innovative on a world scale – and during a recession businesses often need to think outside of the box to make an extra dollar. Businesses in Australia are bloated and lazy on the whole, and cannot often justify investing in new technologies because “well we still make millions of dollars now, so why would we bother?” I’ve seen this attitude first hand across many different businesses in Australia, and without a recession this attitude will not change.

    4. Australia’s obsession with the wrong things

    In Australia we simply obsess about the wrong things. Instead of investing in industries and business that can create products and services that are competitive on a world scale – we direct nearly all of our private investment dollars into property investment. The fact that the Liberal Parties ‘Fake Tradie’ ad had a poorly paid actor talking about ‘getting ahead through in investment property’ just shows the mentality of Australians. The sooner we stop viewing property as the only ‘get rich’ strategy in town, and start funneling our investment dollars to more productive enterprises – the better off we will be as an economy. Surely a way to create this would be to move the ‘negative gearing’ benefits of investment properties and move them to industries of innovation. No country has ever become an economic powerhouse by simply building houses for each other, and making lattes for each other.
    The quality of our entertainment and news journalism is in decline, with Commercial TV networks increasingly being ‘sold out’. As revenue streams dry up for commercial networks due to competition in entertainment from the internet – the quality and balance of news and journalism found on the mainstream networks continues to decline. It’s hard to know these days when watching the nightly news, or major current affairs shows whether the opinions are balanced or secretly funded.

    Another area that frustrates me is sport. I love sport (as most Australian’s do), but the amount of money we waste on Sport in this country is incredible. Governments waste hundreds of millions of dollars in stadiums that are seldom used (i.e. Geelong Stadium is a great example that is only used for less than 15 major events a year). Every election we see upgrades for sports arenas and stadiums – and all of this comes at the expense of local schools and hospitals. Politicians know that spending significant money on Football/Soccer/Cricket/Motor Racing venues wins more votes than something unsexy like a new wing for a hospital, or a new block of classrooms. And don’t even get me started with how much money people waste on attending/viewing sport as well…

    And the final ‘wrong obsession’ that we have is with food. As consumers we demand that everything at the supermarket be ‘down down’ and rock bottom prices – for our milk, our bread, our meat, in fact nearly every other good. However, in the same breath – we have cafes, bars and restaurants full of people happily paying $10 for a craft beer, and $25 for a gourmet burger. Is the Australian population really that dumb they would rather pay more for one 330ml craft beer – then for 4 litres of milk? If consumer and the private industry will not ensure an adequate income stream for our farmers – then it is the job of the Government to step in and create suitable levies. I think you’d find in a lot of cases private industry has ‘bidden suppliers down’ due to market power, and consumers are enjoying the benefits of lower prices when they could indeed pay a higher price for some products.

    5. Our political system is broken

    Finally, as you go to cast your vote – take a moment to remember how broken the current political system is. How can a political party get 15% of the primary vote but not win a single seat in parliament? The preferential voting system effectively makes it a two horse race, and any party that gets less than 25% of the vote is unlikely to win any representation. Is this really the right model that a society should be using? And who are the true beneficiaries of this mode? You could even go as far as asking yourself if we really even need political parties and politicians.

    What if selecting politicians was a random selection of society like jury duty is? Would this lead to a fairer (and more productive) representation of society as a whole? The current pool of candidates is that thin that a record number have had to pull out before election day due to a range of problems (one had links to extremist Islam groups, another owned a brothel, etc.). I read somewhere recently that 40% of the current members of parliament attend church weekly – yet only 10% of Australians do. This might explain the ultra-conservative mantra that exists on the hill in Canberra.

    Democracies around the world are going broke – because politicians need promise to give the society more and more to get elected into office. No politician has ever won a democratic election vowing to rapidly increase taxes to maintain the countries standard of living. This could ultimately lead to Australia being the same situation as Greece currently is within a generation. All of the major democracies around the world are in similar fiscal doom loops (United States, UK, Many EU countries) and you’d have to ask the question as to whether or not democracy will still even exist in 200 years’ time.

    Looking at our current crop of elected members of parliament – you can a see that the vast majority are just boring white senior men. The representatives elected do not actually reflect society. There are very few representatives of non-white Australian background. There are very few women and very few under the age of 40. There are also far too many with corporate/union links and far too many that have never worked a day in a real job in their lives (i.e. career politicians). The real issue with politics in this country is that the system is not designed to benefit the average Australian, and those people that have the funds, time and energy and gamed the system to maximize the value their vested interest represents.

    Vote wisely this election.

    • Raglan – Thank you!!!!!! Good piece!
      Just a bit you have overlooked (IMO)
      Australia’s growth has been all consumption except for mining as per your general observation. That consumption has been all imported. Despite the mining/commodities boom we could never, not once, cover our consumption requirements through exports. So most of our growth is due to the fact that Australia is a country with a remarkable array of resources, and businesses, that we have been able to sell to foreigners to pay our way. They weren’t ours to sell. They belong to all generations of Australians.
      So the Howard/Costello lot were able to feast on this as per your writing. The Ken Henry/Rudd consumption boost schmozzle was based on the full knowledge that it involved selling out the nation. The hawke/Keating reforms re the FFFFFEFR and open capital markets we merely changes to facilitate the further derformation of an already deformed economy. Malcolm Fraser had no idea and Gough, despite the adulation of the intellectual elite, magnified monstrously the problems we had.

      They are all treacherous bastards who have sold this country down the drain just to maintain their short-term electoral popularity!!!! Just ‘not voting ‘ for them is not enough. There should be some ‘hanging drawing and qaurterings’
      Unofortunately the corruption of our economy and, indeed, our society, its ideals and cohesiveness, is way past being able to be reformed.
      I’m too bloody old but we have to try. As per your piece – for our nation’s sake – don’t vote for either of the bastards! There are others I don’t like but that is irrelevant. Just get rid of this rotten duality centrepiece of our so-called Democracy.

      • I’m only 31 – so I guess I still have time to make a difference.

        I do see your point though – we have sold off our natural resources to the point of making our country a desolate wasteland at some point in the future.

        My personal preference for the future is a little more ‘out of left field though’.

        – We should not be scared of Nuclear. We should actually use our position in the globe (both economic, and geo-stable) to create a best-in-class industry. We could provide a cradle-to-grave solution for nuclear – and generate vast economic income without the need for foreign sell outs. I’m not very pro-Liberal normally at all – but I’ve never understood why we would rather continue with coal fired power stations over nuclear when we have such Uranium deposits in Australia.

        With the proceeds of Nuclear – we could invest in massive Nuclear powered desalination plants and huge pipeline networks. Then the majority of land in Australia able to produce food. Sustainable Agriculture, Nuclear and Knowledge Industries would become our main exports to the world.

        I know it sounds crazy, but it’s probably one of the only avenues that we can rebalance the Australian economy without having to sell things out to foreign investors.

      • Ditto; a well argued and structured piece. And as you will be well aware, it’s not just ‘us’ and that is probably the biggest hurdle. Getting Australia back in it feet in splendid isolation might be nigh impossible if the larger powers-that-be; those who so very obviously dictate what we MUST do, are headed the same direction…and worse.

        Then there is a final weak link – and that is us…the USA. We are the most global, powerful, incredible, fabulous country in the history of the world. But here is our problem. When we next fall into recession, the deficit explodes to $1.3 trillion, even if we lose only the revenue we lost last time. If we have to add in the extra cost of safety nets, it’s $1.5 trillion minimum, plus the almost three quarters of a trillion dollars of “off-balance-sheet” debt. US total debt will be rising at over $2 trillion per year in short order…All in, we are adding $2 trillion plus a year to an already huge total national debt. In five years we could be at $30 trillion debt. We are into 2020 and we are now facing $30 trillion in debt and people are going, “Whoa, what the hell are we doing?” (and) you think there is angst today…. Central banks and their Governments have painted themselves into the mother of all corners, and they are going to paint themselves into more corners because their belief system and their presuppositions are fundamentally wrong.

        http://ggc-mauldin-images.s3.amazonaws.com/uploads/pdf/160625_TFTF.pdf

    • WOW…. I can smell the Hayekian paranoia through my screen…. its all democracy’s fault….

      Disheveled Marsupial…. file under when the weird go pro…

    • Raglan – no argument from me! Some 30 years ago, as a result of investigating the processes of a product i sold, I hit upon the Thorium story. From that date till now I have never understood why we were not into it boots and all! We could have been the world leaders. Unfortunately now we don’t have the resources and, possibly, the technical competence to launch any programne and the running is being made by the Chinese now pouring massive resources into Thorium research and use.

      I’ve always wondered why a stupid old Ag Scientist was thinking about this stuff and nobody else was! I never saw a single mention of it until it became fashionable to TALK about it a few years ago. We, supposedly, had 60 Billion to pour into the DPF network but we couldn’t finance Thorium research?

  22. ErmingtonPlumbingMEMBER

    “I know it sounds crazy, but it’s probably one of the only avenues that we can rebalance the Australian economy”

    Goddammit Raglan I think your on to something,…like me your an “ideas man”.
    Im thinking atomic blast excavation to bring the ocean into lake Eyre SA.
    It would become a tourist mecca with resort towns all along its shores, with clubs, kerbab stands and tattoo parlors as far as the eye could see,…itd be our very own Ibiza,…a drunken bogans paradise.

    Though its been thought of before,….Good call brother!

    “Proposed uses for nuclear explosives under Project Plowshare included widening the Panama Canal, constructing a new sea-level waterway through Nicaragua nicknamed the Pan-Atomic Canal, cutting paths through mountainous areas for highways, and connecting inland river systems. Other proposals involved blasting underground caverns for water, natural gas, and petroleum storage. Serious consideration was also given to using these explosives for various mining operations. One proposal suggested using nuclear blasts to connect underground aquifers in Arizona. Another plan involved surface blasting on the western slope of California’s Sacramento Valley for a water transport project.[4]

    Project Carryall,[7] proposed in 1963 by the Atomic Energy Commission, the California Division of Highways (now Caltrans), and the Santa Fe Railway, would have used 22 nuclear explosions to excavate a massive roadcut through the Bristol Mountains in the Mojave Desert, to accommodate construction of Interstate 40 and a new rail line.[4] At the end of the program, a major objective was to develop nuclear explosives, and blast techniques, for stimulating the flow of natural gas in “tight” underground reservoir formations. In the 1960s, a proposal was suggested for a modified in situ shale oil extraction process which involved creation of a rubble chimney (a zone in the oil shale formation created by breaking the rock into fragments) using a nuclear explosive.[8] However, this approach was abandoned for a number of technical reasons”

    • ErmingtonPlumbingMEMBER

      Atomic geo engineering,…way to go!

      https://en.m.wikipedia.org/wiki/Qattara_Depression_Project

      “Calculations showed that digging a canal or tunnel would be too expensive. Bassler decided to use nuclear explosions to excavate the canal. Exactly 213 boreholes would each have a nuclear explosive charge of 1.5 megatons. Every one of these bombs would have an explosive yield one hundred times that of the atomic bomb of Hiroshima. This fit within the Atoms for Peace program proposed by President Dwight Eisenhower in 1953.”

      Dwight Eisebhower – Visionary!

      https://en.m.wikipedia.org/wiki/Atoms_for_Peace

      • What I don’t understand is how ‘Fracking’ is accepted and encouraged commercially in Australia, but Nuclear is a no-go zone.

        I would have thought a sustainable Nuclear industry would deliver more to Australia then fracking ever would have – with the added bonus of not destroying a lot of our prime farmland in the short term (next 100-200 years).

      • interested party

        Fracking ain’t accepted… it’s shoved down our necks…. some democracy, eh.

      • Either way.. Why is Fracking shoved down our throats more then Nuclear when to me – it would appear that Nuclear has a much bigger pay off on a global scale.

      • Look at Operations Plowshare proposals

        the wikipedia entry

        https://en.wikipedia.org/wiki/Operation_Plowshare#Proposals

        including

        Oh yeah, brother. This was actually taken to a couple of Federal (and even more State) elections as policy

        ……….and weirdly enough, it wouldnt surprise me at all if it were to come back. I think the global warming debate will see us geo engineering like billyo over the longer term (rather than simply not warming in the first place)

      • ErmingtonPlumbingMEMBER

        I like how it is stated that there was an insufficient economic basis to proceed,….. Not for any of the reasons laid out below.

        There were many negative impacts from Project Plowshare’s 27 nuclear explosions,

        “Project Gnome vented radioactive steam over the very press gallery that was called to confirm its safety. The next blast, a 104-kiloton detonation at Yucca Flat, Nevada, displaced 12 million tons of soil and resulted in a radioactive dust cloud that rose 12,000 feet and plumed toward the Mississippi River. Other consequences – blighted land, relocated communities, tritium-contaminated water, radioactivity, and fallout from debris being hurled high into the atmosphere – were ignored and downplayed until the program was terminated in 1977, due in large part to public opposition.[4]”

        I wonder what kind of ridiculous and fancy ideas the current generation of “Ideas men” are going to come up with, for “peasefull” uses of weponised AI, Nano and Bio technologies?
        I recon the the Chinese are gona come up with some doozies.

      • Well heres one for the Raglan – Ermington – Gunnamatta development company.

        We get some nuclear explosives (hundred or more – I will see if I can get us a bulk discount for some of the old Russian ones). We ask the developed world and China and India for their old tyres. We blast a thumping big channel (maybe ten klm across) from Eucla to Lake Eyre. We line both sides of the channel and around the lake with tyre mountains and cover the lot with dirt (Maybe we will get some dirt from the Russians too). We get a mega scale landscape designer in to create fjords. We build waterside houses and townhouses we sell for megabucks. We create a port in the middle of Australia (large enough to handle the large volumes of nuclear waste which will be coming to Australia for long term storage). We line a number of those mountains we create with lots of solar panels, or buy land alongside and put the solar panels there. We use the solar panels to create epic desalination plants, and get some of those rivers in the area flowing again. Then we say to the Chinese and Indians ‘look fells, you give us the money, we will build the nuclear and solar plants in the centre of Oz where there is tonnes of sun, you guys plug in through a mega sized cable strung from India and/or China.

        We turn the entire ‘Eucla Channel’ coast into an adventure playground the like which every kid in the world wants to visit. We turn the Great Australian bight coast into a large scale retirement village (with no impact on the whale breeding grounds in the bight). We get bird watchers to come to Lake Eyre. We set aside a portion of coast somewhere for casinos, brothels and strip clubs. We use any excess water we can generate with our mega desalination plants to irrigate and farm. We import lots of Poms – (deserting an impoverished homeland) (after getting them to sign a loyalty clause in the citizenship documents – any singing ‘Rule Britania’ or wearing Union Jack clothing sees deprtation)

        I have it all worked out, just trying to rustle up some funds now

        ……..and a nice sunny position somewhere will be reserved for the creation of Chateau Gunnamatta and accompanying white stone palace and pier for my ocean going cruiser

      • Hay Gunna….

        Sounds like Bribie Island without the nukes… tho you still have to be careful of the indigenous after the sun sets….

        Disheveled Marsupial… sux about the bottleneck getting in and out tho…. chortle…

      • And with all of the earth we dig out….. we can create a land bridge to Tasmania.

        King Island will be the new Hamptons……

      • drsmithyMEMBER

        Either way.. Why is Fracking shoved down our throats more then Nuclear when to me – it would appear that Nuclear has a much bigger pay off on a global scale.

        Plenty of people poised to make lots of money of fracking.

        Less so for nuclear.

  23. And surely – there are enough of us on Macrobusiness now to form our own political party in time for the next Federal election ?

    • interested party

      Lol…. can’t see that getting up, mate.
      More splits here than a waterlogged pumpkin.

      • Or…… Ugly People, and Good looking people that invest in real estate…… Hahaha.

      • “More splits here than a waterlogged pumpkin”

        Just turn the whole thing into a reality TV show.
        Leith, David and Gunna trim the potential candidates back over a few weeks.
        An ‘Ink Master’ for the keyboard bashing know-it-alls of Australia.

    • I’ll run if you need a non threatening man child to sit on the back bench for a few terms. Another option is that I could do something to dismiss me from any hope of gaining power within the party, thus providing me with the means to be the moral conscience in the hubris of real politik that will no doubt cripple the party after three weeks of being sworn in. All I ask for in return is a shot at a second term so that I can get that pension. And the occasional spot on q and a, just so I can roll my eyes when other people are talking. I’m sure there are some other things I’d need, but we can bash that out later. One last thing, some other poor sod will have to go on Kitchen Cabinet. I’ve done many shameful things in my life but I do have some integrity.

    • Yeah count me in. I would like to be a backroom man if thats OK – although Senator Gunnamatta has a nice ring to it .

      I will stack branches (and engage in intra party barneying against other members of the Macrobusiness party) and do some of the organisational stuff (like come up with a theme song)

      here is a draft

      Oh we’re from MacroBusiness
      A Market fury we’re from MacroBusiness
      With many in leather you will see us with a pin
      Creating something of a din

      Where the mainstream’s blind
      Their policies we’ll grind
      we’ll haggle and bicker for a win

      oh we’re from MacroBusiness
      we never weaken market and social justice glows
      like the nutters of old
      we’re strong and we’re bold
      oh we’re from Macro

      -red fox and black-
      oh we’re from MacroBusiness

    • ErmingtonPlumbingMEMBER

      Well, now we got a song, you can count me in!,…. I’ll resign my Labor Party membership tomorrow.
      I can pick up the Piss, cook the BBQs, organise the hookers (Male and Female one’s,….we are going to be an inclusive and Non-discriminatory party I trust),… and unblock the shitters when required (Mates Rates of course).
      Taking on these responsibilities,…….. I would need a Party Credit Card.
      😉

      • For which faction are you going to do this mate? Can’t have the lot as I’ll have nothing to do.
        BTW – I’ll need a CC if I am to perform same duties for one of the factions.

    • Can I be the velvet sledgehammer bringing a corporate revenue tax down on the oligarchs and their sucklings, leaving sole traders and citizens exempt.

    • ErmingtonPlumbingMEMBER

      “Beer is living proof that God loves us and wants to see us happy.” – Benjamin Franklin “Wine is necessary for life.” – Thomas Jefferson “My manner of living is plain…a glass of wine and a bit of mutton.” – George Washington”

      In answer to your question,..Yes,…. 6 beers whilst organising the ute for next week.

      • ErmingtonPlumbingMEMBER

        ” btw check out Moses drunk outside his tent wanking on about enslaving others for his protegee….”

        Are you referring to Noah getting caught wanking himself by his son?

        Gen 9:20-25.

        20 Then Noah began farming and planted a vineyard.

        21 He drank of the wine and became drunk, and uncovered himself inside his tent.

        22 Ham, the father of Canaan, saw the nakedness of his father, and told his two brothers outside.

        23 But Shem and Japheth took a garment and laid it upon both their shoulders and walked backward and covered the nakedness of their father; and their faces were turned away, so that they did not see their father’s nakedness.

        24When Noah awoke from his wine, he knew what his youngest son had done to him.

        25 So he said,
        “Cursed be Canaan;
        A servant of servants
        He shall be to his brothers.”

        Pretty harsh call by Noah, Just because he fell asleep after shooting a load all over himself and was embarrassed that his son saw him in such a grubby state.

      • Counterfiat…

        Antiquarian bogans should have been cognitive of the ramifications of doing their own product not unlike bikies selling ice…

  24. Malcolm Turnbull fears sleepwalking voters could deliver his worst nightmare

    http://www.theage.com.au/federal-politics/federal-election-2016-opinion/election-2016-malcolm-turnbull-fears-seepwalking-voters-could-deliver-his-worst-nightmare-20160626-gps6g4.html#ixzz4CffvhSyV

    I must confess I reckon this is where we are heading. Maybe not a hung parliament, but possibly a parliament with a weak majority and incapable of delivering real policy – right at the time (next 18 months in particular) the economy sails over the edge

    If that happens we wont be joking about creating parties next election….

    • So the faux left has a tanty and throws its toys out of the playpen whilst leaving everyone else to clean up the mess…. they helped to create…. special….

    • My reckoning is we will become ungovernable…until one day we all vote for a STRONG leader!!!!

    • and Uncle Rupert has met with Donald Trump this weekend in Scotland………

      Jerry must surely be wondering where it all went so weird…

  25. haroldusMEMBER

    anyone know anything about worm farms?

    my worms seem to be more keen on their newspaper than the veggies.

    and they are committing hari-kiri in the wee down the bottom

    • TailorTrashMEMBER

      Mate ….they need to get on the property ladder and get ahead to the upper levels ……seriously …are these Strayan worms or what ?

    • interested party

      What are you feeding them? They don’t like acidic habitat.
      Is the tub well drained? Too much moisture is not great.
      Is it in the shade or sun? Don’t let it get too cold.
      pH around 7-7.5 is good can push it out to 8 for a short spell.
      If too wet, soil can get low on O2 May need aeration if worms are not very active and is too wet.

      Try a dose of molasses if all else is ok. Bacteria love molasses… and worms love bacteria……and any minerals that have gone through the gut of an animal…worms included…become plant available.

  26. Some musings on the effects of the Brexit vote.

    The majority opinion on MB seems to be in favour of Leave, but we in Australia do not have a dog in this fight, so lets look at it through British/European eyes.

    The majority of opinion makers (the press, the City, Parliament) are clearly for Remain. It is unclear to me whether the majority who voted for Brexit have much political clout at all as they appear to be older, less well educated industrial/rural workers who I would expect to be Labour voters. And UK Labour leaders are for Remain, so are they going to go into bat for constituents they don’t agree with?

    If this hypothesis is correct, how could the Brexit result be overturned? Well some in the press are rooting for a petition to have a second vote. For such a vote to be carried means that over 1 million voters for Remain have to be found amongst the 28% who did not vote last Thursday. Seeing that the 72% turnout is way higher than those voting in General Elections, I would be sceptical that a second vote would see sufficient numbers of Remain supporters be enticed to vote so that the result was overturned. I can speculate that a lot of young voters did not vote last Thursday as the did not feel engaged in the political process, and would change their mind if a second referendum was held, but that renewed sense of engagement would apply to young Leave voters as well as Remain supporters. And a second loss would set Brexit in concrete such that no ‘elite’ could overturn it.

    So where does that leave us? How about ignoring the Brexit result altogether. The referendum was not binding on Parliament and, before the vote, Parliament was solidly for Remain. Ignoring the vote and, in effect, thumbing their nose at Brexit supporters appear to have no significantly adverse political effects. Boris Johnston and his pals would have to be shafted as most of the Leave parliamentarians are on the Tory side. But with a free vote Labour Remainers would produce a solid Remain majority. Of course Labour would have a difficult narrative to spin in the next General Election, but then who would represent the Midlands working class Leave voters, Tories? I don’t think so. And ignoring the vote would allow the current parliament to follow its natural term (four more years?)

    OK Brits, I have solved your problems for you. Gird your loins and press on and bugger the referendum. As a footnote, it may be that trying to press on with Brexit causes such a financial crisis that the UK staying with the EU is the least worst option. I note the Italian banks are now down over 50% in this calendar year, and Italy’s debt is one of Europe’s highest.

    • If the result was mirrored, with the “leave” losing but the same margin as the “stay in” group, would we be having this discussion? The “stay in” group would be arguing they have a mandate and there is no need for another referendum. The “stay in” group had all the help, the money, major political parties (largely both sides), big business, diplomatic backing, big everything behind them, and yet they still lost!

      • Exactly, if remain had got up it would be all forgotten now, and there would never be the remotest consideration of why (eg) 48 or 49% had voted for Brexit. All the focus would be on ‘they lost’

        Thats why the corporatised, ask no questions, we know best world has to keep winning. Its a great model when everyone thinks they have to get onto the model because the model never fails. Its a different model altogether when it needs to be studied closely because it has failed to deliver.

        That said, I dare say there will be plenty of push for a revisit. It doesnt really matter now. Even if Remain get up a second time round, that element of doubt caused by a first Brexit vote could never be washed away. And the costs of ensuring that a Remain vote were to get up have been repriced radically just through that.

  27. TailorTrashMEMBER

    I have one very nieve question on the Uk referendum ………..it is reported that the old people voted for leave while the young voted to stay …..so if it was a “secret ballot ” ………how do they work this out ……serious question ……how can they tell what age group voted which way ? …other than this is some sort of exit poll or post poll polling ….????

      • TailorTrashMEMBER

        Ok thanks …makes sense ……..just not enough Vicky Pollard neighbourhoods to get over the line ………

  28. Rumblings. P Hammond (F Secretary) says UK must keep access to single market. Not doing so would be “catastrophic”. BBC reports “foreign flow of investment into UK is already drying up”.

    Already.

    Political mayhem. Infighting. Finger pointing.

    BRACE BRACE BRACE

    “The referendum has revealed deeper fissures and deeper divisions than perhaps we realised were there.”
    Peter Hennessy – Historian and constitutional expert, Attlee Professor of Contemporary British History at Queen Mary University of London.