Economic lies about the “rock star economy”
The business media is all in an excited state over the fact that the headline growth rate for the New Zealand economy is at 3.6% for the year ending June.
What they don’t tell you is that because of the artificial boost to the population as a result of the government opening the taps for new migrants the actual annual per capita growth rate is only 0.7%.
“We are seeing low-quality growth in what New Zealand produces,” says CTU Economist Bill Rosenberg commenting on the June GDP growth statistics released today. “Not all growth is equal.”
“Much of the growth is driven by the rising population, with high net immigration. Per person, GDP rose only 0.7% over the year – well below the 1.6% per year average since 2012 (after the recession ended), and far below the 2.6% per year average from 2000 to 2007, before the recession began.
The record population growth in the year to June was enabled by the government approving a near record number of new residents, a record number of students, a record number of temporary workers. It was helped along by a decline in New Zealanders escaping to Australia.
The economy has also had a boost through the renewed growth in New Zealand household borrowing. At 163% New Zealand has now surpassed the household debt to income ratio record achieved just before the world financial crisis in 2008-10.
The government has also significantly expanded the number of tourists being admitted from China by easing the visa requirements significantly. This adds to spending and the extra demand on the tourist sector is accommodated through relaxing temporary work visas.
There is more spending, more hours being worked and more production in the economy as a consequence but it is shallow. There is no productivity increase. There is no increase in incomes for workers.
The wealth being created is being siphoned off by those at the top.
The government’s policies are continuing to feed the asset bubble in housing which is creating a dangerous threat hanging over the whole economy when it comes crashing down. The longer a bubble is inflated the bigger the crash that follows will be.
(This blog was updated September 16 after the official GDP numbers were released)
It was Goebbel who said: “The essential English leadership secret does not depend on particular intelligence. Rather, it depends on remarkably stupid thick-headedness. The English follow the principle that when one lies, one should lie big, and stick to it. They keep up their lies, even at the risk of looking ridiculous.” (with credit to Wikipedia)
NZ Inc., its CEO and cow-towing minions use the sycophant press to push the lies. They all look ridiculous.
MOSA all this week a rout of the global stock market has begun again so we are going for another crash.
15/9/16. The senior financial advisors on CNBC actually warning this morning that the market has many dangers, amongst the most danger is that the stocks are massively over valued with expectations as the companies have artificially priced the stock based on pure air and no evidence of values.
Most investors are now realising this and are beginning to pull their money out and the banks have no leverage or tools left to hold the market up so it is just a matter of time till big bust and flight comes to us.
I suppose Mike Treen could have used words like ‘dire’ and ‘dreadful’ but he didn’t want to raise our hopes. 🙁
The amount of money most of us have to ‘pull out’ wouldn’t raise a flat mattress by even a millimetre.
Looks like the prudent thrifty oldies are in for a scalping, let alone a haircut. ‘Twas ever thus.
Best investment for hard times ahead? Life-jackets for underwater mortgages…
Yes, – Colman Brunton is not accurate and should be scraped.
“The government’s policies are continuing to feed the asset bubble in housing which is creating a dangerous threat hanging over the whole economy when it comes crashing down. The longer a bubble is inflated the bigger the crash that follows will be.”
Yep, and when National are removed from power, and the house of cards comes tumbling down, you can predict the response: “This happened under their watch! It’s their fault!” The mask will come off to reveal the monster, yet those who remove the mask will be blamed for the monster’s deeds.
It sure is “rock star”, AC/DC type, I reckon, a HIGHWAY TO HELL kind of economy we have jumped on, hell-bent to head over the cliff.
The Blighted Future will replace the slogan “Brighter Future”.
Government actively use what is known in the accounting services industry as “Creative accounting” it is as simple as that folks.
Some will call it a form of propaganda and we all know NatZ are very involved in Propaganda.
How many NZ houses can you buy with US$125 million?
http://www.zerohedge.com/news/2016-09-12/supervisor-massive-fraud-wells-fargo-leaves-bank-125-million-bonus