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Nats warn of credit downgrade

Written By: - Date published: 7:39 am, October 1st, 2011 - 17 comments

The Nats have indulged in a long series of boastful posturings and dire warnings about the risks of a credit downgrade, many of them as recently as August 10th.  Now that they have suffered not one, but two separate credit downgrades, Mr Smile and Wave has some explaining to do.

Nats’ muddling earns credit downgrade

Written By: - Date published: 7:19 am, September 30th, 2011 - 107 comments

National has borrowed $37 billion in less than three years and delivered no growth for it. In fact, it has repeatedly failed to meet its growth projections and GDP per capita has fallen. That failure has now resulted in the credit rating agency Fitch downgrading our credit rating. Makes a lie of the Nats’ line that we’re in better shape than in 2008. Will Bill English resign?

Update: S&P downgrades us too. English’s resignation letter being drafted on 9th floor to stem political fall-out for Key.

A Smidgen of Truth Escapes the msm

Written By: - Date published: 1:19 pm, September 29th, 2011 - 15 comments

It’s not often that ‘bald truths’ escape the filtration of the msm. The video below is an example of one of those rare moments.

Muddling through question time

Written By: - Date published: 7:10 am, September 29th, 2011 - 23 comments

National did not cope well yesterday when their economic record was held up to the light. John Key was all at sea as he tried to dismiss new statistics showing 47,000 jobs have been lost under his watch. He cited instead another statistical series, which he has previously rejected when it showed 56,000 more people are unemployed under National.

Counterpoint

Written By: - Date published: 6:05 pm, September 10th, 2011 - 12 comments

I’ve just read Vernon Small’s piece today and I actually learned things from it, other than opinions plucked out of thin air by the author. Small explains the fiscal and economic challenges now existing that the next government will have to cope with and, with a nod and wink, tells us National is going to push out its date for getting back to surplus.

Free trade suckers

Written By: - Date published: 10:45 am, August 30th, 2011 - 38 comments

Free trade is meant to be about opening up markets for our exports so that we can improve our trade balance and, ultimately, become less indebted as a nation. Yet the opposite seems to be happening. Darkhorse shows that this is the experience of all countries that lower their trade barriers in a still largely protectionist world.

Vampire Economics: The Reserve Bank Act

Written By: - Date published: 1:03 pm, August 19th, 2011 - 50 comments

I came across this blog called Howdaft written by Darkhorse recently. It consists of five posts written in June. Five of the best pieces of leftwing economic thinking you’ll see anywhere – something we’ve been short on recently. I’ve tried to contact Darkhorse, but no luck. If you’re out there, drop us a line. In the mean time, here’s one of the posts.

Don’t sell into a down market

Written By: - Date published: 7:34 am, August 9th, 2011 - 34 comments

Before the government launched its asset sales policy, the Treasury told it that “significant participation by foreign investors” would be “essential” to provide “pricing tension”. In other words, if they can’t sell to foreigners at a high price, they wouldn’t get the revenue they want. So, the second global financial crisis should scupper the plan, eh?

Keynes vs Hayek debate at the London School of Economics

Written By: - Date published: 12:28 am, August 6th, 2011 - 25 comments

BBC Radio 4 in the UK has a very interesting debate pitting followers of Keynes vs those of Hayek

Hickey’s prescription for the currency

Written By: - Date published: 12:26 pm, August 3rd, 2011 - 36 comments

The neoliberal myth is that government economic policy doesn’t really matter, it can’t affect the economy – apart from being an anchor on growth. The truth is, government is the biggest actor in our economy. What it does matters. Bernard Hickey has listed 10 ways that the government could act to get the exchange rate down.

PSA launches myth busting campaign

Written By: - Date published: 10:56 am, August 2nd, 2011 - 57 comments

The PSA is launching its election campaign this evening.   Our big challenge is to break through the government’s narrative (now reaching  mythic proportions)  that NZ is sinking under debt the likes of Greece  tooand the only solution is to cut public spending and sell assets. As the well informed readers of The Standard know, NZ’s […]

Political crisis, not debt crisis

Written By: - Date published: 11:00 am, July 29th, 2011 - 10 comments

The media are reporting the chance of the US defaulting as a ‘debt crisis’, as if the problem is too much debt and people won’t lend to them. It’s not. The US is still borrowing at half the cost we borrow at. The problem is the debt ceiling. A purely political invention that lets lawmakers cut taxes, add spending, and then refuse to allow the resultant borrowing.

Corporate debt is the problem – not the answer.

Written By: - Date published: 8:47 am, July 11th, 2011 - 160 comments

We keep getting told that government is the problem and that the private sector is the answer. But the reserve bank numbers clearly show that it is the problem. When are the private sector going to deal with their burgeoning debt levels?

Bill’s Magic Numbers

Written By: - Date published: 8:12 am, June 12th, 2011 - 16 comments

Bill (and John and the entire National caucus) have been telling us that we are required to borrow $380 million each and every week.  Apparently we aren’t.

So, borrowing to save makes sense afterall…

Written By: - Date published: 9:59 am, June 8th, 2011 - 29 comments

Do you remember back in the day when Bill English didn’t want to put any money into the Cullen Fund? Remember how we were smugly told that borrowing to save was foolish? Well, since then the Cullen Fund has made a fortune and, we know learn, the government has been borrowing to build up savings for the Christchurch rebuild.

Chart o’ the day: the Savings Budget

Written By: - Date published: 10:14 am, June 6th, 2011 - 19 comments

Net International Investment Position is how much New Zealand owes foreigners and foreigners own of New Zealand assets minus the reverse.

The great debt myth

Written By: - Date published: 12:02 pm, May 31st, 2011 - 55 comments

This government’s got a real talent for manufacturing crisis to suit them.  The debt disaster is a classic – in order to get out of debt we have to cut public spending to the tune of almost $1billion and sell assets.

There Is An Alternative

Written By: - Date published: 7:18 am, May 16th, 2011 - 66 comments

The run up to the budget has all been about cuts.  How many?  How deep?  Like lemmings we’re accepting National’s framing, and marching even faster to our economic doom.  But, there is an alternative. Instead of slashing spending, we can raise government income. Here’s how.

If only smiles were dollars

Written By: - Date published: 10:26 am, May 15th, 2011 - 38 comments

The minor party debate on Q+A was very interesting. Rahui Katene was self-contradictory and vague, like the Maori Party always is. Peter Dunne was pathetic. Roger Douglas slammed the government’s borrowing as did Russel Norman, who pointed out the other three had all voted for National’s debt-increasing tax cuts for the rich.

Cunliffe addresses Key lies

Written By: - Date published: 4:53 pm, May 11th, 2011 - 56 comments

Key’s pre-budget speech was hugely uninspiring and mis-leading.

Cunliffe rips his claims apart.

Debt explained

Written By: - Date published: 7:33 am, April 27th, 2011 - 7 comments

The same scenario of tax cuts, national debt, and public spending cuts is being played out in New Zealand, Britain and the USA.  Here’s the right wing argument in a nutshell…

Choices, choices

Written By: - Date published: 11:32 am, April 1st, 2011 - 21 comments

In the last Budget, National cut the corporate tax rate to 28%, which costs $400 million a year and comes into effect today. It also cut $200 million a year from early childhood education and tertiary funding in the same Budget, while borrowing billions. When the government cuts public services it is because it chooses […]

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