Have another brain wave. Declare New Zealand has a future as an important international financial hub. Then do, ummm, well nothing really. So…
Loading ...Have another brain wave. Declare New Zealand has a future as an important international financial hub. Then do, ummm, well nothing really. So…
Loading ...This entry was posted on Wednesday, September 1st, 2010 at 6:00 am and is filed under economy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
Guess hes a tad busy at the moment but don’t worry old fella, he’s got another term (or two) to get it started
The government is in dreamland until it gets some comprenhensive and sensible financial legislation in place… The easy answer is a “special economic zone” but they don’t even seem to have the sense to promote that…
Once he gets the mess you lot sorted, and that may take another term, watch for things to happen. It took Labour 9 years to empty the coffers so filling them again won’t happen overnight. Some privatisation and a few asset sales in the next term will help speed the process up.
The Great NZ Wall St Bailout
Re. Southern Canterbury Finance. Why the **** is the Jonkey Govt paying 100c in the dollar to bail out millionaire investors of Torchlight and the millionaire owners of Torchlight? The multimillionaire owners should be taking a sharp haircut, some sharp losses, and paying out their own investors out of their own pockets! Why has the risk been passed on wholesale to the taxpayer?
And why is the Govt paying out on huge yields to bond holders who bought their bonds at steep discounts, who paid 80c or less in a dollar, now being paid a full dollar back of tax payers money, sometimes only weeks or months after bondholders first purchased the bonds?
The richlist looking after the richlist with hundreds upon hundreds of millions of our tax payers money. The same people who want to pay less taxes will now happily accept our tax money.
Yet when it comes to the Govt finding a million bucks to run a community service, help the elderly look after their homes, or provide sexual abuse counselling…oh, look there’s no money! Fend for yourself!
Yeah of course there is money, the capital is sloshing around like an ocean controlled by rich list gate keepers, and it is earmarked to go to the investor capitalist class of this increasingly socioeconomically unequal society.
I tell you what a better SFC scheme is. The first $50,000 owed to any individual ma and pa investor in is paid back in full. 90c in the $ on the next $50,000. 80c in the dollar on the next $50,000. 70c in the dollar on the next $50,000.
Down to a floor of 50c in the dollar for every dollar above $250,000 the investor is owed.
I simply cannot believe that NZ is now conducting its own Wall St bail outs. And here, like there, the tax payer is going to foot the bill for Jonkeys high finance friends at 100c in the dollar.
The big millionaire players take a risk, you lose some money, isn’t that the capitalistic market driven system the NAT Govt adores? Or is this one instance you really want the nanny state to look after you and bail you out?
And lets not forget we are talking about giving 100c in the dollar back to large South Island rural investors too – i.e. National’s electorate, and National will want pay back for their generosity with tax payers funds.
I really hope Red Alert covers this issue…The Standard is all over it.
Hah. Where is personal responsibility?
To John Key and Bill English, I am expressing my thanks and gratefulness (and no envy) as a working poor taxpayer for the opportunity to give my contributions to these corporate and financial beneficiaries and for underwriting their upkeep and lifestyle.
Loota they are paying it because it is a least cost settlement, and its the law- and if they dont they will get sued and either lose the case or pay lawyers more than the original amount over many years of appeal, or probably both.
If Labour were any decent opposition however, rather than the bunch of whining amateurs left over from the days of enabling Helen, they would have held Treasury to more rigorous scrutiny when it advised it was acceptable to allow SCF continue in the guarantee scheme- with plainly substandard accounting and “investments” in place.
@Chris 73 – so you’re saying that he’s relaxed about it and needs another 9 years to think about it?
Oh well, Goff is going to kick butt next year and save the country
Of course we’re going to be a financial hub, China is going to own everything some day
Phil Goff reckons that SCF’s fate was “sealed by the Government’s failure to get a proper economic recovery”.
Phil Goff is just as responsible for the SCF payout, having been an active participant in the Labour government that set up the guarantee scheme in the first place!
Shame on him for this opportunistic nonsense.
As for the Silly Ideas poll, what a load of trite nonsense. For each of these inanities there is a similar lesson to be learnt from Labour’s failed initiatives – any one recall the great lightbulb fiasco? Go back a decade or two – what about the ‘knowledge economy’?
Surely the Hon Pete Hodgson has more responsible ways of spending the taxpayers money than this drivel.
1, Good on Labour for wanting to protect people from losing their money!
2, Oooh touchy about the polls, keep em up Pete
3, These polls are freee, freeeeee, frrrrrreeeeeeeee. The MPs pay for this blog themselves
!
After the collapse of Wall St. I really think that NACT wouldn’t have been able to implement it anyway – people are waking up to the fact that the financial economy doesn’t actually create any wealth.
@pdm
re-writing history I see.
Will help to empty the nations coffers and pass it all to the wealthy just as happened in the 1980s and 1990s.
@Loota
The big capitalists always look for a government bailout and will always get it. They want it so that when the small people try to make themselves better and things don’t go according to plan they’ll lose out and be forced to work for the big capitalists. This keeps the authoritarian hierarchy intact.
@Grant
If Labour had any sense when they introduced this legislation they would have ensured that finance companies couldn’t get it and that it had a 1 year limit on it.
Of course its a least cost settlement mate. Its least cost to the rich because they get 100c in the dollar back from the tax payer for every single dollar they tipped into the mess.
These multimillionaire speculators should be taking sharp haircuts for every dollar they put in over $50,000, while ma and pa investors with smaller amounts in there should be fully protected.
I do find it amusing how the Right Wingers have to defend this massive transfer of tax payer wealth to the rich while thinking it funny that finding a million dollars to save specific community services or fund sexual abuse counselling is just too hard to do.
What an inequal, unfair, one eyed society the NATs are supporting.
The bail out is exactly what the labour party should use to beat the GOV up with.
But will they?
No because the labour Party has by and large the same centre right economic view that the Nats do
If in the last 9 years the Lab Gov had done something about the stupid pseudo competition in the Electricity Market and re nationalised it
If they had actually supported Unite’s campaign for a $15 an hour min wage
and had at least had a go at reforming the ECA. Then we might have a lab party worth voting for. But what do they do.
Have a leader who publicly supports rogernomics. FFS
Hint the word ‘labour’ should give you a clue where you should be
It’s the Green Party for me till you guys get your act together
I know it not good SCF, but I come from and live in South Canterbury, and most of the crap in the media is rubbish, Hubbard been out of the powerless in SCF for a long time, since he got sick he had the reins over to a CEO from a bank and well, he screwed it all up back in 2007,2008.
But yes, it shouldn’t be bailed out but if you did you effectually destroying much of NZ economy/income and which in turn would destroy Auckland income (those fancy bankers and ceos don’t work the tossers, just rent seekers). SCF would be one of the biggest lenders in the South Island so if you kill SCF you kill the south island which nearly half of the NZ economy gone just like that.
Really what it killed which killed all the other fiance companies was lending to the residential property development boom!
At least Hubbard is willing to go done with his ship, or save it from sinking, you idiots up north (auckland) have NO idea what he has done to try and save SCF, a lot of his own companies and assets where put into SCF to try and save it.
Well, at least he got guts to sink with SCF unlike you bloody Blue Chip and Hanover.
Bloody jafas
Loota, the Labour party introduced the guarantee scheme so pretending it’s all a National party conspiracy puts you firmly in the paranoid category…
I believe the Government should be deferring the first payments till the 8th and then amending the Act under urgency on the 7th to remove any compensation for interest – only paying out the principal…
If they let the whole of SCF collapse they would be a fire sale and then you could have a good piss and moan about 50+ farming companies and prime NZ wide CBD properties being sold to foreigners for cents on the dollar…
Essentially SCF is now an SOE (to be liquidated) your usually all in favour of SOEs…
A few questions remain:
- Why was SCF given an extension..?
- How much would bridging finance till Dec 11 have cost the government..? If less than $600,000,000 why wasn’t it done..?
- Has anyone been deliberately mislead via disclosures and prospectuses (prospecti?)..?
If those questions can be answered satisfactorily then (barring the payment of interest) the Government has done the right thing given the self imposed legislation – which should never have been passed – but thats a different story with questions for Clark and Cullen – or extended – with questions for Key and English…
@Spud
I hope, come the next election, you remember your predictions and when you do make sue you visit this link
http://www.youtube.com/watch?v=lb8fWUUXeKM
@Chris 73 and this is for YOU when Labour wins the next election: http://www.youtube.com/watch?v=utweW1-dIuM&feature=related
Note the colour of their clothes, Oh yeah!
JMH:
Oh. Back to the name calling, then JMH?
Let me ask you, who admitted SCF into the extended guarantee scheme in April, was that during Labour’s watch or National’s watch?
And can you really be “paranoid” when they just agreed to pay out $1.7B of tax payers money to bail out some high speculating finance types at 100c in the dollar?
That’s not paranoid mate, that’s perspicuous.
Red Bed said
Everybody lets slow down and think about reality here.
So you’re saying that if SCF went under, all the sheep in famer’s paddocks would instantly die and all the cows in the paddocks would instantly stop producing milk?
No, didn’t think so, the productive economy would still be producing just fine thank you. The world does not end just because a ****ily run finance company goes under.
Any serious business operations who experience real cashflow problems due to SCF going under and not providing lines of credit can be bailed out directly by the Government.
This prevents $1.77B worth of tax payers’ money go straight into speculators’ pockets at 100 cents in the dollar.
Which is of course the real aim here.
Loota
“So you’re saying that if SCF went under, all the sheep in famer’s paddocks would instantly die and all the cows in the paddocks would instantly stop producing milk?”
Really…
But SCF has lent a hell lot of money, especially to the dairy industry, and if SCF did fall mean of these farms would have to shut down or beg to a major bank for a loan, especially at the moment banks are lending squat so the chances are most of the farmers wouldn’t be able to get a loan. So these farms would be forced to shut down for a while and it would be a few years before they back online. Since no money is being earned, therefore no money is being spent.
Plus these farm would be up for next to nothing, and it would mostly like be speculators and asset strippers who would buy them and they would prolong the pain. With farms being take a part and changing many hands.
Of course SCF is not lending all of the South Island economy, but it does lend to a significant chuck, especially back home in Canterbury.
“can be bailed out directly by the Government”
but would they bail them out. Giving the way national is. Ot might bail out a couple of big farms but most of the small holdings would be left to die and would be feed for the vultures…
Loota, Im justifying saving SCF, not the investor who got back 100% in the dollar plus all interest. That a different matter.. The interest shouldn’t been include…
I’d like you to think about this for a second.
If SCF has loaned a farmer $500K to develop his farm, and SCF went belly up, the farmer still has the $500K in cold hard (loaned) cash.
Now since he doesn’t have to pay SCF back, so the farmer is actually in a much better position than before.
In this case, why would the farm shut down?
Now, what if the farmer needs the $500K to keep the farm going, has been promised that $500K and now SCF can’t payout.
Well yes that’s going to be a problem for that farmer.
Easy. If the farmer has got a solid business plan and equivalent collateral in place, the Government loans the money directly to the farmer.
But under no circumstances does the Govt pay our monies to the big shot speculators who helped send SCF under.
pdm
Oh dear ! Where do you get it from.
Coffers are now being stripped by bankers – again.
Asset sales. What rob the cupboard to privatise and have to buy back at inflated costs and greater mortgage.
The old game privatise the profits and assets and socialise the costs.
That game will be curbed as it runs its course but we all pay for the losses caused by a few.
PDM
Who do you believe a country should be run for. Serfdom is not a stable state.
Big economic changes are accelerated by high profits and high debt, particularly when based on cheap energy which is not a growth commodity in a world of finite and shrinking resources and also with growing population.
All these things are against more of the same.
It is not a new story.
Denial may be a strategy to uphold short term profit but time lost makes the eventual outcome much more devastatingly profound.
There is not a financial solution as the problem is the result of excess money.
Those who have been brainwashed to believe social solutions are abhorrent will be in for a painful time. Most world crises are solved by social organisation and action.
Do a bit of reading. Try some history where imbalance of wealth keeps growing.
@Loota
“If SCF has loaned a farmer $500K to develop his farm, and SCF went belly up, the farmer still has the $500K in cold hard (loaned) cash.”
Ummm if the farmers developed his farm then he/she won’t have the money, it’ll (hopefully) have gone to the builders/contractors/tradesmen people who did the work on the farm plus some will have gone to farmers places where they have accounts as well as probably buyingin more livestock
sorry to point this out you
Morning Chris
And the farmer will still owe $500K to the receiver/liquidator/statutory manager/administrator of SCF. So in fact the financial position of the farmer has changed not one whit.
Morning Richard
Thus far I read a tragic string to a slightly amusing but irrelevant-because-old-news post. Where the hell IS Her Majesty’s opposition on the SCF rort?. God gimme strength, I’m off back to the Greens.
@Galeandra
I’d sooner back Labour then the Greens
I wasn’t calling you names Loota just pointing out that if you think SCF is a conspiracy by the Nats to benefit wealthy people you have to believe Clark and Cullen were “in on it”… If you believe that you are paranoid…
Oh dear… One word: Mortgage…
OK that’s fair enough JMH, I accept the fact that things have moved from a conspiracy to benefit very wealthy investment interests to a reality benefitting very wealthy investment interests.
I think the government made a massive miscalculation when re-admitting SCF but I don’t think they went through the loan book and spotted individuals first…
That is the nature of money Loota, wealthy people are going to have a lot of money in any financial institution and if you want to protect “mom and pop” investors the wealthy end up being covered too…