Apparently Labour was to blame for the global financial crisis

Written By: - Date published: 9:00 am, July 5th, 2018 - 65 comments
Categories: Amy Adams, capitalism, Economy, making shit up, Media, national, same old national, spin, the praiseworthy and the pitiful, you couldn't make this shit up - Tags:

These sorts of debates do my head in.

Essentially because they are so removed from reality that anyone with any sense would know that Labour was not responsible for the last global financial crisis.  But apparently the opposition spokesperson does not understand what happened in 2008.

Does this seem a bit harsh?

Well it is one of only two interpretations there can be for this tweet put up by Amy Adams last night.

I mean how stupid does she think we all are?

Does she not recall that the global financial crisis happened in 2008? That event which brought the world’s economy to its knees, all through the avaricious greed of Wall Street and a bunch of merchant bankers?

Apparently not. Such evidence of memory failure should mean that she should never be trusted with the Finance Ministry. I mean how could you risk having someone whose recollection of a major event was so bad?

The other possible interpretation is that she does understand but is willing to say anything, anything to attack the Government.  And she is happy to ignore all the evidence showing that the housing crisis is something that developed on steroids from about 2012 after immigration surged as part of National’s only economic growth policy.

But I suspect we will be having these debates over and over and over and over again in the next few years.

65 comments on “Apparently Labour was to blame for the global financial crisis”

  1. Blazer 1

    August 2010-
    ‘Prime Minister John Key says he is concerned that New Zealanders could become “tenants in their own land” and that is why the Government is looking at overseas investment rules around land sales to foreigners.

    A TV3 poll released tonight showed 75.5 percent of voters want the rules tightened, with only 8 percent saying they should be relaxed.’Stuff.’

    National all talk no action.

  2. Gosman 2

    The trend was for lower consents from the early 2000’s (And especially from around 2003). The GFC only hit NZ in 2008

    • bwaghorn 2.1

      The Aussie boom played a part in that kiwis were flocking over to oz chasing big $$.
      And no it wasn’t Labour’s fault they were going it was just big pay packets nz couldn’t compete with plus the sheep factor.

    • Tricledrown 2.2

      Gosman the value of consents didn’t decline till 2007 building costs were rising but land availablility was becoming a problem by 2007.
      The economy under labour grew by volume by 3 times what National managed before and after with much lower unemployment.
      Much higher savings govt investment as well.
      Nationals govt books made to look much better than the totals.
      Due to massive returns from ACC prepaid future funding account the Cullen Fund and kiwisaver disguising Nationals, $110 billion borrowing for tax cuts around elections

    • Tricledrowm 2.3

      Gosman consents issued don’t equal numbers of houses built.
      a consent is a piece of paper not houses built.

  3. Enough is Enough 3

    Greg can you read a graph?

    It looks like a downward trend from about 2003/2004. It plateaued out about the time the GFC began.

    I am surprised by this graph. I would have expected growth over the early to middle part of the decade with a steep decline around 2008.

    • dukeofurl 3.1

      The are cherry picking by firstly using monthly totals, then only Auckland.

      Amy Adams of course wouldnt have a clue about housing , so some ambitious and
      dishonest person in the nats staff/Collins office has done it for her. ( Adams ‘disappearance’ over last 3 months is telling is this her ‘breakout hit’)

      The biggest decider of housing back then was likely interest rates movement and the Reserve Bank here signalled a slow down a bit before the GFC by sharply raising rates to ‘ create a soft landing’.

      If you overlay the interest rates on this data it will likely mimic some of the swings

      • Enough is Enough 3.1.1

        I am not disagreeing with any of what you say.

        I’m just pointing out the graph in no way supports Greg’s proposition that the GFC caused consents to decline. The graph shows things consistently going downhill from about 2004, (which is kind of what Adams was saying).

        • dukeofurl 3.1.1.1

          Consents can be different things. I was involved in some around that time period. A good percentage are not progressed or a particular month might have an apartment block consent with say 75 individual units. A new subdivision might be released and theres a rush of consents for the sections in the next 6 months. The slowdown was mainly because interest rates were rising and the supply of land was drying up. I know developers who were passing on some sites because of rising prices at the time.

          they are using fine detail for a reason, all the other measures, say 6 monthly show them in a bad light

          We saw that with the SHA’s a scheme under national, these werent building consents for homes, but the first step. Huge numbers of sites got the RMA/SHA consent, a smaller fraction got the site consent to create a subdivision and even smaller numbers of homes that were completed. Dont remember details now but it was something like 1/10

        • dukeofurl 3.1.1.2

          Enough , they have used a monthly graph to specifically muddy the drop. yearly or 6 monthly consent issued are a better measure.

          NZs sharp increase in interest rates have more effect before 2008
          https://www.rbnz.govt.nz/statistics/key-graphs/key-graph-90-day-rate

          You can see big rises after 5% in about 2004, 7.5% in 2007 and then in hindsight the disastrous steeper climb to 9% in 2008. US rates were falling after 2006

          • Tricledrown 3.1.1.2.1

            Dukeoferl numbers of consents issued don’t tell you how many houses actually built so who ever put the consent figures up is not telling the whole story it may take several years for that consent to be acted on.

    • Draco T Bastard 3.2

      I’m not. John Key was actually correct in 2007 when he said that a housing crisis was developing. It just all disappeared when he and National got power.

      The problem then was the same as it is now: Excessive immigration and a banking system that produces asset bubbles.

      http://positivemoney.org/issues/house-prices/

  4. Hooch 4

    This sort of stuff reminds of a quote from terminator, adapted to suit below…

    “Listen, and understand. The national party is out there, it cant be bargained with, it cant be reasoned with, it doesn’t feel pity or remorse or fear, and it absolutely will not stop…EVER, untill labour are dead”

  5. The massive rebuild in Canterbury post 2011 can only have inflated the stats. Therefore the rate of building outside of Canterbury must have been inadequate to have met the needs of other centres such as Auckland.

    • indiana 5.1

      You make a good point. It would be good then to compare the number of new build consents in Canterbury for the period 2000-2010 and see if that was in decline too.

  6. patricia bremner 6

    Just more right wing garbage. Stats massaged as Collins did to make the crime stats look better in my opinion, selective misleading representation of events by the housing crisis deniers.

    The fact the nats are going gangbusters to denigrate Kiwibuild tells me it is a winner.
    The public agree, as the rate of sign up attests. Let’s do this, Phil and Coalition.

  7. Aaron 7

    Ah, so one neoliberal party is trying to blame the another neoliberal party for a problem caused by both of them over the last 3 decades!

    Wake me up when someone wants to do something real about the problem.

  8. Blazer 8

    Literally millions of new millionaires with chinese sounding surnames have been created since the new millenium.

    Couple this with the effects of massive QE, compliments of the GFC,and stable western nations with very lax criteria for property investment’ by foreigners and …voila!

    What other asset class is safer for a world awash with ‘printed’ money

    • soddenleaf 8.1

      A house, empty, in every major city owned by the same multi millionaires. That’s a tax, a private tax, on our land, infrastructure, our utilities. And do they even pay tax when trading the housing pocketing capital gain…

      it’s nuts that we debate housing, it should never have come to this.

    • Hongi Ika 8.2

      Buying by our little yellow skinned brothers along with QE and financial liquidity since the GFC have created a housing bubble here in NZ ?

      • Baba Yaga 8.2.1

        Is that sarcasm, or an attempt to better Labour’s racism?

        • Andrea 8.2.1.1

          Baba Yaga: “Racism: prejudice, discrimination, or antagonism directed against someone of a different race based on the belief that one’s own race is superior.”

          Maybe the first part.
          Where’s the evidence of the latter part of the definition?

          Or is ‘racism’ the new word to express a dislike of queue jumpers flaunting large sums of money before the usual easily-dazzled eyes? The ones who can blow by the people who have gone short for years to save a deposit.
          The ones who have a huge advantage over the trusting mugs in the low-wage economy. From wherever and regardless of ethnicity.

          That ‘racism’? Okay. Same page. Same hymn.

          • Baba Yaga 8.2.1.1.1

            Hongi’s post fits your definition perfectly. He’s blaming “little yellow skinned brothers” for creating a housing bubble. It’s not only racist, it’s also factually untrue.

        • Tricledrown 8.2.1.2

          Babygaga our resident yapping dog barking madly at every initiative the coalition govt is trying.

          • Baba Yaga 8.2.1.2.1

            Actually I’m pointing out the hypocrisy of the left. Racism is ok when they do it. Sexism is ok when they do it.

      • Grafton Gully 8.2.2

        Why should we sell our homes to Chinese when people like us can’t afford them ?

    • Lettuce 8.3

      Indeed. China has been printing money hand-over-fist to keep pump-priming its economy, creating a vast new millionaire class. However, none of them trust China’s Ponzi-scheme economy to keep rising forever without experiencing a major economic shock at some point (if it does, it’ll be a first economy in human history to avoid a crash at some time). Therefore, the trick is to get some of that printed money out of China into much more stable investments like residential property in Western countries (if those countries are stupid enough to allow “overseas investment” in their housing market).

      One way to combat this might be to declare that anyone who owns a property in New Zealand, regardless of how many days they’re in the country per year or their immigration status , is considered a New Zealand resident for tax purposes. Therefore they must pay New Zealand income tax on their verified worldwide income (with all double taxation agreements observed in the interests of fairness of course). It would be interesting to see how many foreign speculators chose to retain their New Zealand properties if this were the case.

  9. CHCOff 9

    In a somewhat sad state of affairs, but wasn’t Mr Key at the time orbiting around the circles that triggered the global crisis via the faulty derivative packages & the like into the global economy?

  10. Blazer 10

    John Key made the biggest $ windfall of any deal he has done in his life when he sold his Parnell property and retained 500 sq m of it.

    No wonder he resigned…the ultimate inside trade.JK…’no comment’.

    • indiana 10.1

      Wow! if thats your conspiracy theory, then I have one that Kiwibuild is a Labour’s version of a ponzie scheme, where they will earn the interest on the deposit made to buy a house that may not get built!

      • Lettuce 10.1.1

        The only way that’s going to happen is if New Zealanders are stupid enough to re-elect a National government that cancels Kiwibuild and leaves it to the (very) “invisible hand of the market” to build the houses we desperately need.

  11. Blazer 11

    Key 2007.

    ‘We also want to ensure that every young New Zealander who works hard and is disciplined about saving can expect to own their own home and thereby have a real stake in the economic future of this country.

    Today, I want to talk in some depth about the declining rates of home ownership in New Zealand. ‘

    ‘This problem won’t be solved by knee-jerk, quick-fix plans. And it won’t be curbed with one or two government-sponsored building developments.

    Instead, we need government leadership that is prepared to focus on the fundamental issues driving the crisis. National is ready to provide that leadership. Earlier this month I announced our four-point plan for improving home affordability:

    Ensuring people are in a better financial position to afford a house.
    Freeing up the supply of land.
    Dealing with the compliance issues that drive up building costs.
    Allowing state house tenants to buy the houses they live in

    ‘The Government’s own research into home affordability has stated in no uncertain terms that, “The RMA process needs a revamp to reduce delays associated with objections.” That’s because delays result in major uncertainty for people considering developing housing.

    They also cost money directly. A one-month delay on a $12 million project adds $100,000 to its cost. This increased cost in turn increases the required profit margin for houses and thus the price of those houses when they eventually come to be sold. This is just one more way that the RMA hits first-home buyers in the hip-pocket. .

    National is committed to simplifying and streamlining the RMA and doing it fast. We will introduce our RMA reform bill in the first 100 days of a National Government. Those changes will be made into law within six months.

    Furthermore, any changes we make to streamline and speed up the process of zoning or land release will require developers to build on that land within a reasonable timeframe. This will prevent the land-banking that is currently choking off the supply of land.
    Since I made those initial announcements, various experts and independent bodies have come out with even more evidence to support our approach. I intend to go over some of that evidence in this speech.

    Over the next 18 months or so, in the lead-up to the 2008 election, I will be announcing plenty of new policy in these areas.

    National will look for long-term solutions based on a sound understanding of the economic forces that have led to the contemporary low home-ownership rates. ‘

    • Leaps 11.1

      Yeah right!
      That’s the longest Tui ad I’ve ever seen 😉

    • Stuart Munro 11.2

      Yeah I remember that. Key talked a good game on housing. Did fuck all to fix it though.

    • smilin 11.3

      Amazing how he never meant a word of it .And no one even saw it as being a lie that should have cost him the election

      • Blazer 11.3.1

        When a home owner sees his own property in Auckland increasing by $1000 a week, year in year out,he feels pretty good….and he/she votes.
        The finance sector,advertising,insurance,RE …all absolutely love it.

  12. tsmithfield 12

    What the graph shows is a steady decline under Labour from around 2003. Then a gradual recovery under National. This recovery occurred despite backdrop of the Global Financial Crisis, which makes National’s management even more remarkable.

    • Blazer 12.1

      Do you moonlight as a comedian.
      National sat on their hands and watched as property prices exploded.
      They did borrow about 100 billion in their term…remarkable??

      • tsmithfield 12.1.1

        All I am doing is pointing out what the graph indicates that is in plain sight. Afterall, that is what the article relies on.

        In fact, I suspect that a third variable such as immigration trends is more likely to explain the graph than any particular party that was in power over the period.

    • Tricledrown 12.2

      ByTsm land availablility the cost of building houses increased at a rapid rate after 2004 making houses and house building more expensive.
      The value of new builds didn’t decline till 2007 their were big shortages of labour materials and land with low unemployment in Auckland mainly.
      Numbers of consents don’t tell the full picture numbers of consents completed.
      As usual someone is only telling part of the story.
      The housing shortage in Auckland has been well documented as starting in the early 1990s.
      Looking at stats nz the slow down in NZ started about mid 2007.
      Unemployment was still around 3. 6% up until 2009 when National took power.

      • Herodotus 12.2.1

        During 2007-8 activity dropped part due to the collapse of the second tier finance coys and then with the reluctance of the major banks to fund developers and those building companies. In many cases the trading banks were diverting working capital that was intended to be used in constructing land/houses/appartments etc. to now reducing debt levels. In summary there was few companies with the financial means to continue development. It took until 2011-12 until banks were open to providing adequate capital again.

  13. Gabby 13

    What’s the big spike around 2003 down to shmitty?

  14. cleangreen 14

    Good logic Micky.

    While Gosman is running his/her campaign to plug the cracked walls of the national Party machine I for one think that Amy Adams is just carrying out her well used policy of repeating the lies under the national party belief that if you repeat the lie long enough it becoms the truth so anything that national says now should be ignored.

  15. R.P Mcmurphy 15

    you dont need a graph to know that as Winston Peters opined the nationals party is an amalgam of amateur backbenchers. I would call them manques and parvenus. they dont read books and dont give a toss about history unless it is something the nationals research office has cooked up for them to read out at night when the heavy hitters have gone home and then wait for the tame print media and the hoskins and garners of this world to repeat for the masses edification.

  16. Oberver Tokoroa 16

    Twisted Capitalists

    National through Paula Bennett and Billy English have maintained for several there is no housing crisis in New Zealand. An utter total lie. Ref: Salvation Army and numerous other Sensible Community Groups.

    So no matter what Amy Adams says, National stands as the party who deprives Hundreds of thousands of housing.

    And garnishes that tradjedy it with absolutely UNaffordable Rents. Further iced with very low wages.

    The Greed and the callous behaviour of National is the reason why National is gagging out nonsense via Amy Adams is because they are wetting their pants over the mess they have created at every opportunity since 1980s

    The Public know – that National will get you nowhere – unless you are very greedy and and within a cabal marked “Very Very Wealthy”.

    Don’t let your advisors twist you with a mirage of numbers. I know you don’t like Kiwis, unless they are Capitalists. But guard your soul against dishonesty. Trust The Salvation Army and Other Community Groups.

    Do not trust national creeps or trolls.

  17. Rozgonz 17

    Interesting, so now you acknowledge there was a GFC after failing to do so for the 9 years National was in government.

Recent Comments

Recent Posts

  • Milestone in Police recruitment
    A milestone in Police recruitment has been achieved with the deployment of more than 1,000 new constables around the country since the government was formed. Deputy Prime Minister Winston Peters and Police Minister Stuart Nash congratulated graduates of Wing 321 ...
    2 hours ago
  • Government ropes in livestock rustling
    Justice Minister Andrew Little today introduced a supplementary order paper (SOP) on the Crimes Amendment Bill to crack down on livestock rustling. ...
    1 day ago
  • Small business the focus of Australian talks
    Efforts to progress a seamless trans-Tasman business environment will take another step at a ministerial roundtable meeting in Sydney tomorrow. Small Business Minister Stuart Nash and Australian Assistant Treasurer Stuart Robert will co-host a roundtable meeting of senior government and ...
    2 days ago
  • Andrew Little – Speech to Amnesty International event to mark the 70th Anniversary of the Univ...
    ANDREW LITTLE - SPEECH TO AMNESTY INTERNATIONAL EVENT TO MARK THE 70TH ANNIVERSARY OF THE UNIVERSAL DECLARATION OF HUMAN RIGHTS ON WORLD HUMAN RIGHTS DAY, PARLIAMENT, WELLINGTON ...
    3 days ago
  • Tax reforms focus on fairness
    New tax legislation has been introduced to Parliament to ensure greater fairness in the way the tax system shapes commerce, investment decisions and social policies. Revenue Minister Stuart Nash has introduced the Taxation (Annual Rates for 2019-20, GST Offshore Supplier ...
    1 week ago
  • Preventing death and injury on our roads
    Police Minister Stuart Nash and Associate Minister of Transport Julie Anne Genter are encouraging road users to be alert to a new safety campaign launched today by Police and the NZ Transport Agency in the lead up to the Christmas. ...
    2 weeks ago
  • New comms centre improves public services
    A new digital services and communications centre opened on the Kapiti Coast will help transform the way Police connect with the public and work to make communities safe. Police Minister Stuart Nash has officially opened the Police Digital Services Centre, ...
    2 weeks ago