I've come down with some weird lurgy this week. It's giving me nausea and acid reflux. I burp like a baby and can't seem to keep food down. My joints ache, moving around is a pain, and all the old sports injuries are barking. We grow old, we grow old and all that; but you really get to feel it when the joints hurt. Judging from the symptoms, my best guess is that it's the Norovirus. I've been going to work because it's not like I've got a fever or I'm totally incapacitated, but today I was just overwhelmed by this thing. It's a weird thing wanting to vomit and not wanting to vomit at the same time. There are few bodily functions where you simultaneously want to do it and you don't. Ejaculation comes to mind, but that's about it, and it's worlds apart from vomiting in the unpleasantness stakes.
Anyway. Let's really have a spew!
Markets Are Up!
I guess the predictions for a global meltdown were misplaced after all because share markets are up today. Sydney was up yesterday, defying global trends towards the financial apocalypse. This was possibly because going any lower would have made valuations totally 'under', on too many stocks. Jokes aside, BTFD ("buy-the-fucken-dips") is a legit strategy until you find yourself cresting on a bubble like the markets in China. The ASX on the other hand hadn't bubbled at all in comparison to some of these other changes around the globe, and so had less to fall. For all the screaming headlines of "$60 billion lost in a day!", that was roughly a 2.5% drop or so and much of that has recovered. If you bought in on "the-fucken-dip", then you would've done alright.
A lot of commentators are saying this was no Lehman Moment. Maybe that's true, but having experienced the original Lehman Moment, I don't think anybody wanted to chance it, which explains just how much things got oversold in markets outside of China on Monday. Michael Pascoe even had a column yesterday crowing about how he was going to BTFD. Like I said, if you bought in on "the-fucken-dip" this week, then you would've done alright.
The mid to long term is much, much murkier. I'm not the grizzliest of Market Bears, but China still scares the hell out of me. There's still a lot of drama to be played out in response to the share market bubble popping, especially when the people decide what they need to do is string up the market boss. It might be the case that there aren't that many shareholders in China, it's also true that they would have lost a bundle if they were leveraged up to their eyeballs leading up to the share bubble popping. There's still all that Property Bubble out there in China, with all the empty cities, leveraged shadow banking using commodities as collateral, and the commodity prices have bottomed out so you know there are margin calls going on. None of that has changed. There's no reason to think that we're out of the woods with all this China mess business.
Hockey's CYA Republicanism
Out of the blue, WTE Joe Hockey says he wants Australia to become a Republic. It's kind of weird, but I guess it's one way to rebrand yourself as "I'm not with Tony Abbott, I'm not on that team of suck". Uh, WTE Joe, oh-but-yes-your-are!
The other possibility I thought of was that Joe fears the incompetence of this government so much, he even fears the Governor General sacking Abbott's government. In which case, moving to a republic would kind of cover his ass. Perhaps I shouldn't try to guess the motives of the Worst Treasurer Ever.
The Republican debate is one of those interesting things that bring out all sorts of spurious arguments of identity. Admittedly, when Paul Keating was pushing for it, I thought the notion was totally logical and the conservative forces allayed against an Australian Republic were doing so out of zombie loyalties to a crown of a distant land who cared so little about any of us to the point of mutual irrelevance. And while that may be true, in the years since the referendum was lost I've had some time to read and think about all this.
One of the more disturbing things about a Republic - with a President - separate to the Parliament/Congress assembly is that you have to begin asking who gets to call the shots on the military. In America, this is the President and since some time around Lyndon Johnson, has been able to go to war without the approval of Congress. This is a big issue because hidden in it is the possibility of an exacerbated conflict between the Presidency and Parliament. It hasn't come to blows in the USA, but the track record of Republics around the globe are pretty telling. This problem happens far more often than not, and on a long enough timescale, it seems to happen inevitably.
It is such a woeful record that so many Republics fail, and give rise to military juntas that it is worth reflecting on whether the Republican model of any stripe can forestall this problem. Some argue that Australia's democracy is more mature so it won't happen. Yet I have it on good authority that during the Dismissal crisis in 1975 a trade unionist suggested to Gough Whitlam that he order the Army to remove the Governor General. Gough laughed off the idea as lacking in common sense - but Australia's maturity as a democracy hinged on Gough Whitlam's good common sense. These things that inform good common sense are razor thin, and hardly robust at all.
As a centre-left-voting-pinko-pseudo-intellectual, it's tempting to remove the Queen, let the ancien regime be damned. Yet the historian and nascent political scientist in me says this is a dreadful risk to be imposing on this nation. I'm not as gung-ho as I used to be in the 90's about a move to a Republic. Maybe I'm getting old, maybe I'm just sick and tired of an abstract debate when we have actual, real-world difficult problems lying ahead of us. Malcolm Turnbull might ride again as the standard-bearer for the movement, putting in the good fight once more but that alone won't do it for me. I'm so leery of this topic, I don't even want to change the flag.
Speaking Of Our Real World Problems...
Former head of treasury Martin Parkinson says the Abbott Government is sleep walking its way into a recession. If things stay the course under this go-slow, do-nothing, collect-the-rorts Government, we would lose 5% of GDP in the next decade, which would be a pretty serious recession.
Pretty sobering, no? He wasn't the only one pointing out the problems we've got. Try this bit:
Economic modeller Janine Dixon from Victoria University had told the summit the Treasury's Intergenerational Report had painted a "rosy" picture of the future, projecting average growth in real income per person of 1.4 per cent, meaning that by 2055 Australians would enjoy real incomes 75 per cent higher.
Her own modelling had real incomes growing by less than 1 per cent per year, meaning that by 2055 incomes would be only 44 per cent higher.
Put another way, it would take an extra 20 years to reach the income forecast in the Intergenerational Report for 2055," she said.
Her modelling has productivity growing at only half the pace assumed by the Treasury, whose assumption was based on the unusually high decade of productivity growth that followed the economic reforms of the early 1990s.
Melbourne University economist Ross Garnaut said if her estimates turned out to be correct, the budget would "never get back to surplus".
Reserve Bank governor Glenn Stevens said Australia's economic growth rate had mostly started with a "two" instead of a "three", "despite the lowest interest rates in our lifetimes".
Dr Parkinson said if economic growth remained nearer to 2.5 per cent than 3 per cent, as much as 5 percentage points of gross domestic product would be lost over the next decade.
"If this is not happening because our population growth is slow, it means willingly accepting the impact of a recession," he said.
"The loss of GDP from a recession is about 5 or 6 percentage points."Just as an aside, I don't know what to make of this new trend of one-sentence-pragarphs being written at the Sydney Morning Herald. It's like ADHD Journalism. Complaints about style aside, that's like a who's who of economic boffins saying - nay, shouting - to the government "LIFT YOUR GAME!". And my question to these esteemed boffins is, "WHAT IF THEY ARE SIMPLY INCAPABLE OF LIFTING ANY GAME THEY MIGHT HAVE, WHATSOEVER?!"
Without acting we would be "sleepwalking into a real mess".
I guess we'll be kissing away that 5% in GDP. Still want to talk about Republics? I just want the Governor General we have now to sack this lot, pronto. Maybe it's not Norovirus that's making me want to vomit but simply living under this nauseating excuse for a government.
One More Plea From The RBA
So, at this conference going on, Glenn Stevens, he of the Reserve Bank of Australia had a few choice advice for this government.
Ordinary Australians don't relate to calls for reform emanating from politicians but they do want economic growth to create new jobs, grow prosperity, and provide long-term financial security for their families, Glenn Stevens has told policy makers in Sydney.
However the Reserve Bank governor acknowledged that focusing on growth was no populist option and would mean squaring up to the kind of hard political challenges that both the current government and the opposition have shown no appetite for.
The call for growth came as Mr Stevens repeated his concerns that the Australian economy had entered a long-term plateau, in which trend growth is significantly lower than Treasury and therefore government forecasts assume.
In arguably the most significant contribution to the National Reform Summit, which has brought together business, union, community, and policy leaders, from around the country, the central banker said for economic restructuring to be embraced by voters it needed to be framed in terms of its end-stream benefits for people.
To that end, he told the high-powered gathering that "the general public is much more likely to grasp, intuitively, a conversation about growth".I don't know about you, but I take that to read, "do your jobs properly you stupid intellectual runts". And I think it applies equally to the Opposition as it does to the addled minds that are in power this minute. Collectively, this political caste has to stop playing too much politics, gaming the ideology stakes, and get on with the job of addressing the real issues.
Heydon Hanging On
You get a guy who is biased pretending to be unbiased. He subsequently gets busted for being biased. Yet the same biased guy gets to decide if his bias is a problem. He had last weekend to think it over and said he couldn't. Now that the week's dragged on to Thursday he says he still can't decide whether his bias is a problem in being a Commissioner for a Royal Commission. He says he'll tell us Friday. In the mean time, the ACTU says not only did the guy biased, he misled everybody. That's being euphemistic - what I think they want to say is that he lied.
It just doesn't look good. So why would he opt to keep twisting the breeze any longer than he needs to? Imaginer's misplaced professional pride, but every minute he stays on runs through whatever professional credibility he has left. So he must be hanging on for some other reason right? Like... money, perhaps?
I guess it's just another thing going on in another ring in Abbott's Three Ring Circus Government.
I think it's time for me to give into this overwhelming desire to go puke. Good night!
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