It is interesting how situations can be given different interpretations according to who is interpreting it or for what purpose they are interpreting it.
An example of this is the Global Financial Crisis (or GFC for short). Ever notice how this phenomenon is described as a recession by anyone trying to explain their inability to improve their business performance or that of the country while those who are trying to kid us they have made a difference tell us ‘things are looking up’?
But one thing is for sure; the GFC is not all bad – at least not for all people. Take the banks, for example. To look at their performances you wouldn’t know there was anything amiss with the economy at all. If KPMG’s latest Financial Institutions Performance Survey can be trusted, the last year was one of the most profitable for bankers in recent times. Combined net profits of banks in NZ last year amounted to $3.3B compared with $2.77B in 2010. That is an improvement of more than 20 percent.
So the banks are doing very nicely thank you while the rest of us are seeing our income stalled and prices rising and have to dip into our savings to make ends meet.
But don’t worry; Jianqi is going to sell our top performing State Owned Assets to pay for our health and education. But wait a minute wasn’t education going to be funded by the great charter school scheme? That’s the great plan where McDonald’s Secondary Modern and the Coke Adds Life Intermediate both start churning out a whole new generation of burger flippers and people with no teeth.
Of course the stars of last week’s blog are doing very nicely as well during this ‘downturn’. Figures released by the casino company in February of this year show its profit for the six months ending December 31, 2011was $78.8M. In the previous year it made a profit of $123M and expects this year to reach $140M. It is easy to see why they want more machines. Revenue from their slot machines increased by a whopping 17 percent. It’s harder to see why they NEED them though.
What was that somebody said about ‘harm’? Don’t talk rubbish. I have it on good authority (SkyCity CEO, Nigel Morrison) that Lotto is more harmful than pokies, although given he runs no Lotto games and a shitload of pokie machines, he might be just a tad biased, don’t you think? However in addition to being biased, our Nige is also stupid and he doesn’t do his homework. Had he bothered to check before opening his independently operating gob, he would have found some very handy and interesting figures in the Gambling Helpline New Zealand Report which show that in 2010 NO problem gamblers contacted the Helpline due to their problems with Lotto and in 2011 only six had a problem with Lotto. On the other hand... there is a fist and it should leave Nige with his ears ringing and fully informed about the more than 800 people who contacted the Helpline after having problems associated with their use of gaming machines, casino tables and cards. Admittedly most of those on the gaming machines are accessing pub ones. However it doesn’t take a genius to work out that if pub machines reduce in number while SkyCity ones increase, then the problem gamblers are going to migrate to SkyCity in ever increasing numbers.
So it seems, somewhat ironically, that the financial crisis is affecting everyone except the money people. Am I the only one smelling putrefying rodent flesh here?
We bailed out a load of finance companies when this all kicked off and the insurance companies following the Christchurch earthquake. It is hard to find out exactly how much this has cost but the scheme was originally designed to ‘guarantee’ $133B of deposits. It would appear that the fund has actually paid out at least $2B. That amount of money if added to our health budget would have given us around another 14 percent to spend or 20 percent more for education. It gets really crazy when you consider that bailout fund was also guaranteeing a further $131B. How about guaranteeing expenditure on things that actually matter to most of us, eh?
However we are unlikely to get that with a gnome like Jianqi who, let’s remember also took up an appointment with the Federal Reserve before becoming our PM. (How handy was that?). Thus he is in a perfect position to understand what it is like in the real world (Yeah!). With a mere $50M to his name, Jianqi really knows what a struggle the last few years have been for the rest of us and sees no problem in taking our shilling (or $411,510 p.a. plus allowances) for his troubles.
It’s a wonder to me that he can actually tell when the economy improves. It is hardly likely to make any difference to him either way.