They came to Madrid from every corner of the country. Some walked for a month.
“We want work. We can’t accept that millions of unemployed people must go home to live with their parents,’’ said Jorge Balbas, an unemployed man of 24 from Burgos in northern Spain.
The march for dignity was a big one. It was another in an endless stream of strikes, protests, marches, bank sit-ins, and even suicides in Spain. Continue reading
This piece of retro politics shows that those big things on the side of Abbott’s head really are tin, and perhaps even that the space between them is an empty can.
It reminds me of the 1960’s when, with decimal currency approaching, Robert Menzies announced the new currency would be called a Royal. The outcry was so raucous that Menzies was forced to back down, and so we have the Aussie Dollar.
What a shame that two well-liked, and clearly great Australians are caught in the middle of this jaw-dropping piece of politics.
And where’s Malcolm? Hiding in a corner, saying it not important. Nonsense. Time to stand and be counted Malcolm: to hell with cabinet solidarity!
Check out these contributions to the debate:
My post on China at the weekend attracted a bit of interest, so here’s more to ponder …
A visual from Zerohedge:
By now everyone knows that the Chinese credit bubble has hit unprecedented proportions. If they don’t, we remind them with the following chart of total bank “assets” (read debt) added since the collapse of Lehman: China literally puts the US to shame …
And of course the US economy at around $16 trillion is around double China’s. That’s some credit expansion …
And these snippets from the Wall Street Journal:
… weaker economic growth, slower home sales and rising volumes of unsold houses have convinced developers in a number of cities to cut prices to raise cash quickly.
Groups of angry homeowners put up banners and demanded their money back after Hong Kong-listed property developer Wharf Ltd. cut prices.
According to property agency Soufun Holdings, Wharf cut prices of 20 apartments in [the project] to 8,200 yuan ($1,317) per square meter, down from the average 11,000 yuan per square meter it recorded in recent months.
“We aren’t speculators. We just want an explanation from the developer,” said one 35-year-old home buyer, who said he had bought an apartment and gave his surname as Wu. “This is very unfair.”
Mr. Wu said he bought a 120-square-meter apartment in December, for 730,000 yuan. Prices are now 610,000 yuan for a similar apartment in the same tower.
Ooops … 16% loss in 3 months isn’t pleasant …
And then yesterday, well regarded senior business journalist Ian Verrender followed some themes similar to those I pondered on Sunday …
After describing the extraordinary performance of the Chinese economy over the last decade and more, Verrender comments that everything has looked marvelous …
… Until now. While the wheels haven’t exactly fallen off the great China growth saga, what once was deemed the miracle economy has begun to fray around the edges, to endure the kind of pain regularly experienced in the west.
The true test of the resilience of quasi central planning is nearly upon us. Just how China responds to the myriad economic crises now besieging the country will have huge ramifications for the rest of the globe. And nowhere will that be greater felt than here. [meaning Australia].
Verrender comments on the credit expansion and the effect on the mammoth steel industry (remember China produces about half of all steel produced in the world).
Its heavily regulated and controlled banking system has spawned the growth of a shadow banking system where massive but largely unreported debt levels reside. Local governments and state controlled corporations have borrowed to the hilt, investing in largely unproductive assets that have spurred on further investment in steel production.
China’s steel industry now is in a funk …
Hmmm … and he goes on:
No matter how you read it, the outlook for raw materials demand, and hence Australia’s future, appears far less optimistic than this time last year.
No kidding!!
But then he finishes on a sunnier note. (Is this the optimism bias in play):
Rather than a doomsday scenario – a sharp downturn in the [Chinese] economy as it grapples with the legacy of years of uneconomic investment – the more likely probability is that authorities will refuse to allow any kind of harsh adjustment that could provoke political instability.
But can a few central planners control an $8 billion economy? I don’t think so, and maybe he doesn’t either. So to hedge his bets, Verrender suggests:
The alternative could be a rerun of exactly what has happened in Japan; a slow economic decline stretching over decades.
… which isn’t a great outcome either. So, as he says: “China’s leaders are at a cross road” … and so, consequently, are we.
Do you think many of our fearless leaders in Canberra have noticed?
http://www.abc.net.au/news/2014-03-24/verrender-capitalism-suddenly-not-looking-so-bad/5339914
Whilst we’re all distracted by the extraordinary events in Ukraine and Crimea, and the hunt for MH370, things in China are looking dodgier by the day.
In the last 5 years the Chinese have created $16 trillion in credit. That is just an incomprehensible amount of debt. Continue reading
I’ve been asked so many times for my theory on the mystery gripping the world, that I thought I’d write it down.
Someone on MH370 had a sinister plan. We will likely never know what the plan or the objective was.
But to get started, that person (or persons) took control of the aircraft over the Gulf of Thailand. It might have been the pilot, or the co-pilot, or someone else who had the knowledge to fly the plane. Or perhaps a bit more likely, someone who intimidated the flight crew into doing what they wanted them to do.
It flew west, over Penang, and out over the Bay of Bengal. Why? Headed for where? Nobody knows.
Then, after a time, other passengers knew something was up, and just like the fourth plane on 9/11 they ran interference on the original sinister plan. Somehow there was chaos and violence. No-one who knew how to fly the plane ended up being able to to so, probably they were dead.
Somehow the plane was headed south and on auto pilot. It was far enough west to miss observation by Indonesia as it went south. And with nothing the others aboard could do, dead or alive, conscious or unconscious, the plane continued on auto pilot until it ran out of fuel and crashed into the ocean.
Plausible? I think so. Certainly more plausible than most of the theories I’ve heard.
But here’s another mystery to ponder …
Never, at any time, did I hear a suggestion that the plane might have “landed” on the water. Nary a thought that the plane might be found: escape slides deployed and converted into rafts; all who had been on board bobbing around in their yellow life jackets with their lights on and blowing their whistles.
Why? … Because, as far as I know, it’s never happened at sea. (Making the landing on the smooth Hudson River all the more remarkable!)
So here’s the mystery …
Why do we sit, tied in our seats, watching how to take a course of action that, “in the unlikely event of an emergency landing on water” will never transpire. They know it is pointless. We kinda know it will never happen. But the ritual goes on. Thousands of times a day around the world.
Something to ponder there???
I’ve been listening very hard to Joe Hockey recently.
Way back, whilst still in opposition, he made that famous “it’s the end of the age of entitlement” speech in London. Lately he’s been strongly on the same theme. He argues that the Government is out of money and can no longer support much of what has been supported hitherto.
So, Government has no money to support foreign car makers GM, Ford and Toyota; SPC Ardmona; Qantas; or pretty much any business for that matter. Health spending cannot be sustained so we might soon have to pay (more) to go to the doctor. The population is ageing so pensions are no longer affordable and the entitlement age will have to go up to 70 to save money. The public service will have to be downsized (and services cut). You’ve heard them all.
(The vaunted Commission of Audit was due to deliver an interim report in January. It’s likely to recommend harsh Government spending cuts all over the place. But still no report, and it’s now March, the month the final report is due.)
Nevertheless, to this point in his argument, I think much of what Joe says is correct. The so called social welfare safety net has been gamed and distorted over many years, mostly by competitive politics, into being much more than a safety net for the genuinely needy. Joe’s right to call “time”. He’s right to say we can’t have what we can’t pay for.
But then Joe wanders into Wonderland instead of driving the argument on to where it logically ends: we’ve lived high on the hog and we have too much debt; Government services have to go down and taxes up; the economy is changing alright, and living standards will fall. We’re all in this together: get used to it!
Wandering in political Wonderland, Joe seems to ramble on in hope about new jobs in new 21st century industries. (Like what? … have you heard even one suggested?). He struts the G20 stage with fluffy aspirations about 2% more economic growth over 5 years, thus supposedly creating huge numbers of new jobs. He talks vaguely about re-structuring the economy, (but that seems mostly to be code for screwing down wages). He waves around the magic word “productivity” without seeming to understand what it means; without acknowledging what the all the implications of improving it are; and probably hoping no-one calls him out on the subject. He tries to comfort us that everything will be alright, that things will get back to how they used to be.
All of which seems to me to totally miss the points that technology, globalization of the economy, and the rise of Asia (where they can now do everything we can do, better and cheaper, except farm and mine), have changed the outlook for Australia forever.
That’s the reality. Joe needs to face up to it. We all do.
Yesterday Tony Abbott stood in front of a press gathering in Tasmania and asked could anyone think of “another Government program that had caused death”. There appeared to be a polite silence … I was astounded!
Abbott was, of course, making a vain attempt to defend the need for the Royal Commission (translation: totally redundant political witch hunt) into the previous Government’s home insulation scheme which was accompanied with four regrettable industrial accidents causing death.
Does Abbott think we are idiots?
In the same news cycle we were being told of death at Manus Island! The mandatory detention of scared humans seeking asylum has previously caused other deaths too …
And then there were the perfectly foreseeable deaths in the pursuit of “weapons of mass destruction”
I’m sure if you ponder on it you will think of others …
Abbott goes to the top of the class for hypocrisy. Junk politics at it worst!
The Wall Street stock market has broken stride in the last month or so. Through the last quarter of 2013 it kept rising, breaking new highs every few weeks. Just recently the Dow and the S&P have basically gone sideways.
Many have an opinion on why that might be. I don’t, because the market long ago left behind any rational basis for valuation relevant to the real economy and the likely future profit performance of businesses. It’s now all about the freshly printed money slopping about, and the bets traders are making against the market and each other.
So who does know what’s going on?
Well, those on the inside of businesses would have a pretty good idea don’t you think?
Of course they do. That’s why “insider trading” is illegal. But that doesn’t mean that insiders can’t buy and sell shares at various times in various circumstances.
Thomson Reuters and others keep an eye on share trades by insiders to see when they are selling and when they are buying. Goodness knows where the data comes from, but by standing back and looking at trends, you get a broad hint of what the corporate insiders think about the value of the shares they know about. If you were armed with inside knowledge of what was going on in a business and thought the share price was high and likely to fall, you’d be a seller, right?
Well, here’s Reuters view of the last 12 months. The peaks represent a high level of action by insiders heading for the exits.
Look what’s happened in January. Makes one wonder. Could it be why the rise in the market has lost momentum?
Zero Hedge comments:
Of course, we are sure someone will try and explain away this avalanche of insider-selling with “tax-related” factors or “taking-profits” but none of that negates the less-than-optimistic tone that it implies about what the short- or medium-term expectations are from management of the firms that comprise the US equity market…
Hmmmm …
There is no better metaphor for the hubris of those in power than the Olympic Games.
The vaunted Olympic ideal is was that the best sportspeople in the world come together in fun and fellowship to test their extraordinary skills and talents against each other. Winning is good, but not everything. Spectators come to cheer, to marvel at athletic achievements, and to support their favourites.
Nearly everything about this seems to have got lost in the last decade.
The 2000 Sydney summer Olympics was (one of) the last to hold close that Olympic ideal. It was widely regarded as the pinnacle. The IOC was urged to quit whilst ahead in it’s ever growing campaign to always better the last Olympiad.
It cost about $6 billion. But that was before 9/11.
The Sochi winter Olympics (for less than half the number of participants) is reported to be costing more than $50 billion!
Here’s the Guardian last week:
[These] modern mega-events … are just bombastic, statist, commercial, nationalistic conventions, ones that nowadays are so inviting to terrorism as to be choked with military impedimenta.
Particularly after the Volgograd bombings, security is a huge issue (and cost). The Guardian again:
An army of 30,000 is deployed. A further 40,000 police and internal security troops lie in reserve. Missile launchers and tracking devices are commissioned. Air and naval units stand ready. [After Volgograd] this entire force was put on “combat alert” … local civil liberties are suspended and hundreds of “suspects” rounded up.
Not exactly an environment that would induce the average tourist to buy tickets!
Why Sochi? It’s not a big place. It’s remote from an international tourist point of view. There’s not even much snow by the looks of it. Much of the infrastructure and sports venues and tourists will be vastly under-utilised after the event.
So, of course, it’s all about the money!
Just like FIFA’s bizarre decision to hold the 2022 World Cup in Qatar was probably about the money: $200+ billion, apparently???
The Guardian wonders where all this leads:
The athletico-military-industrial complex seems to have a mesmeric appeal to world leaders, an appeal expertly exploited by bodies like the IOC and FIFA … The politics of host nations are of no concern to them. No one calls these bodies to account, because they claim a higher licence from the great god sport.
The bankrupting of Athens and the impending bankrupting (if nothing worse) of Rio de Janeiro shows the horrific cost of these events to less than wealthy cities. The money is generated not by sport but unaccountable bodies making demands on national exchequers in return for prestige. This is what obviates the simple remedy to all this cost, which is to hold these events each year in the same place. They would swiftly revert to sport.
One day the worm will turn. In Rio, the poor (and not so poor) are already rioting against the extravagance. In Sochi, Putin’s gamble with international terrorism is already proving lethal. As so far planned, Qatar will have footballers dying of heat and stadiums left decaying in the desert like Ozymandias’s ruins. It will one day go horribly wrong. Perhaps then a brave ruler will have the guts to walk away from this nonsense.
Nice sentiment (with which I totally agree), but from whence will come that “brave ruler”? It will require things to go very “horribly wrong” for a politician to have such “guts”.
Meantime, let’s see if there’s some good sport to enjoy on TV next month …
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something 2 ponder 