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  1. #471
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    Quote Originally Posted by winner69 View Post
    Aaron ..you might enjoy this

    America’s drift towards feudalism

    https://americanaffairsjournal.org/2...ard-feudalism/
    Cheers Winner, peoples prognostications are interesting. Not that I care that much about America it is just that with the internet we are pretty much swamped by American writings. My concern is NZ is heading down a similar path. With death and estate taxes gone, no capital gains tax and a reserve bank joining the international bunch of retards pushing up asset prices exacerbating wealth inequality and shutting out the next generations from home ownership.
    It used to be NZers had an equality of opportunity but that is slowly being eroded as it must if fewer and fewer people have a larger and larger share of assets and income. Obviously we are a long way off a feudal society but policy seems to be taking us towards it rather than away to where every kid born in NZ has an equal chance to make a life for themselves through work and or ingenuity.

    Central bank policy basically is a downward spiral, I can't see how they can reverse course, with debt increasing it is hard to see this changing or what an alternative might be.

    Mostly I am gloomy because I am on the wrong side of the trade. Don't fight the central banks is good advice.

    I am voting for whatever party promises to get rid of inflation targeting or setting the target at 0%.

    I need to stop reading this gloomy stuff as I have a lot to be thankful for.

  2. #472
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    This caught my eye due to my need for confirmation bias when reading news. Are assets inflating or is the value of a currency unit deflating? Both correct just looking at the same thing from a different angle. If central banks are never going to raise interest rates then holding currency waiting for a crash is dumb. Currently I am a dummy but still hoping for a significant correction to the debt/asset price inflation/deflation.

    https://edition.cnn.com/2020/01/13/e...ord/index.html

    I post here as NZ is mentioned for it's growing household debt. I wonder if this could be part of our housing affordability crisis?? hmm. ( I use the word "crisis" facetiously as any national party voter knows there is no "crisis") As Brian Rudman explains it is a housing gravy train. (apologies if his article is behind the pay wall)

    https://www.nzherald.co.nz/business/...ectid=12300114

    Also 120 MPs own 307 houses (that they admit to, does this include houses in Trust?) so not a lot of motivation to get to the source of the problem also we can't do much as the world is in a currency war and any rise in interest rates kills our exporters and any restriction in debt ends the ponzi.

    What could end the ponzi scheme? Usually it runs out of mugs to join in but that could be generations away.

    I see Arthur Grimes mentioned in the article discussing how to bring house prices down. Perhaps the father of targeted inflation could suggest getting rid of inflation targeting as it implies a minimum 1-3% rise each year.
    Last edited by Aaron; 15-01-2020 at 08:36 AM.

  3. #473
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    Just wanted to note a small win for deflation.

    A long time coming, sadly it is a pandemic that kicked it off but ultimately a system that requires more and more debt is eventually not sustainable unfortunately deflation will be associated with the misery caused by the virus.

    Possibly savers will be better off in a crisis than borrowers but I suspect bail-ins will happen before borrowers have to sell their security. Also not a problem if the govt pays the mortgage or brings in negative interest rates making savings worthless.
    Last edited by Aaron; 12-03-2020 at 07:30 AM. Reason: deleted link as I read it and it was a but much

  4. #474
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    NZ Reserve bank going full retard. .25 OCR I was concerned the drop in the NZ$ would make Aussie companies less affordable. If I read it right as of 1 second ago you could get $1.02 $NZ for $1.00 AUD.
    Still not happy central banks prefer a currency crisis to people paying back their borrowings as this seems morally wrong to me.

  5. #475
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    Not sure which thread to put this on so I use one only I am reading. I like the conclusion at the end of the article. It reminds me also of the $500mill capital return by AIA not so long ago. Through revaluing the property and borrowing $500mill to provide a return of capital to shareholders. Not quite the same but it does seem odd when the runway is falling to pieces. The CEOs are a breed apart based on their remuneration but a crisis exposes them as regular individuals on a good ride.

    https://www.zerohedge.com/markets/bo...t-term-bailout

  6. #476
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    Not sure what Bill English meant in the herald this morning.

    "Former Prime Minister Sir Bill English appeared to deliver a warning to financial markets: if the stockmarket doesn't fall further the public will realise something is amiss and wealth or capital gains taxes could follow."

    Something amiss? central bank financialization propping up financial markets and house prices? Who could possibly be against that.

    This guy maybe.

    https://www.zerohedge.com/markets/wa...ausage-factory

    or this guy might be onto something. If you can keep the businesses but get rid of reckless overpaid management and shareholders, it might be a positive thing longer term.

    https://www.zerohedge.com/markets/le...ail-out-people

  7. #477
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    Interesting links thanks. Capital gains taxes coming in, of course! Never waste a crisis.

  8. #478
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    Quote Originally Posted by Aaron View Post
    Not sure what Bill English meant in the herald this morning.

    "Former Prime Minister Sir Bill English appeared to deliver a warning to financial markets: if the stockmarket doesn't fall further the public will realise something is amiss and wealth or capital gains taxes could follow."

    Something amiss? central bank financialization propping up financial markets and house prices? Who could possibly be against that.

    This guy maybe.

    https://www.zerohedge.com/markets/wa...ausage-factory

    or this guy might be onto something. If you can keep the businesses but get rid of reckless overpaid management and shareholders, it might be a positive thing longer term.

    https://www.zerohedge.com/markets/le...ail-out-people

    Shareholders are an easy target in NZ. National Party policies have helped channel NZ money into real estate. I imagine Bill English would be happy if farms and residential property kept their value. Is it just shares he has a problem with. They have already lost about 20% of their value plus many dividends have been cancelled - how far have house prices fallen and by how much have rents been cut?
    Last edited by Bjauck; 11-04-2020 at 03:35 PM.

  9. #479
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    Quote Originally Posted by Bjauck View Post
    Shareholders are an easy target in NZ. National Party policies have helped channel NZ money into real estate. I imagine Bill English would be happy if farms and residential property kept their value. Is it just shares he has a problem with. They have already lost about 20% of their value plus many dividends have been cancelled - how far have house prices fallen and by how much have rents been cut?
    It is common sense that sees bricks, mortar and land as the best investment - not govt. policy. Any fool can understand a building, be it a warehouse, office building, shop or even a dumb house - but it takes some sort of expert to understand a business or company; particularly a listed company.

  10. #480
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    Quote Originally Posted by fungus pudding View Post
    It is common sense that sees bricks, mortar and land as the best investment - not govt. policy. Any fool can understand a building, be it a warehouse, office building, shop or even a dumb house - but it takes some sort of expert to understand a business or company; particularly a listed company.
    I totally disagree.It is no surprise that NZ has such expensive real estate for our level of incomes. You need quite a good head for figures to work out cash flow and rental returns and the impact of mortgages? Of course the ability to reduce net income to leverage tax-free capital gains is the icing on the cake. Any fool can see property can be geared to maximising capital gains, which have been substantial and which had been determinedly kept tax-free by governments as to do otherwise would spell electoral disaster.

    And of course the owner-occupied house is the best tax-sheltered investment scheme, if you can afford the deposit to get on the ladder.
    Last edited by Bjauck; 11-04-2020 at 07:24 PM.

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