Mangled Thoughts

What for.

The banks’ senior economists are Keynesians. Some of the commentariat are hard Leftists, while the rest, to be polite, are not equipped to analyse and commentate on economics. The Right’s fighting response, superbly demonstrated by Turnbull, blowing bubbles, is not funny it. Taken all together, nothing stands between Rudd and his stupidity, a second mega-$42b shopping strip trip.

This will be spread out over several items. This one starts with some essentials.

Banks’ Keynesians

It’s not to pick on him in particular but Saul Eslake is media friendly, he pops up with alacrity,  and typifies the banks. They have stuffed their economics bureaus with Keynesians and the result is, the banks’ windows into grave matters and their internal advice is filtered and  generated from within the framework of Keynesianism.

For some years now, Eslake has been demanding the Federal Cabinet indulge in a bit of the ’shop till they drop’. I recollect him saying, ‘Now is the time” for Costello to commit a tremendous increase in Government consumption. There are several problems with it, besides the destructive fallacy of consumption drives growth.

First, Costello had committed major increases in his budgets. Didn’t Eslake notice, or was he ignoring the fact and if he did, why? It is still pertinent. There is, however, more to it.

Eslake was calling Costello to surrender surpluses, and throw budgets into deficit. What Eslake’s demand reduces to, though I am not implying he meant it, is that Treasury should engage in inflation, print money. The RBA was already causing great damage with its monetary expansion. The killer detail is:

How Costello could  manage to escalate Government consumption while maintaining budget ’surpluses’ each year.

Inflation affects prices sooner or later, they rise to absorb the created money. As wage rates, for instance, nominally rise because of inflation, the tax burden rises too - most taxes must because they are indexed taxes. The increase in tax revenues can support greater spending; that this should be done is another matter. As for surpluses:

The trick is to keep spending less than the rate of inflation. A surplus neutralises some of the created money, and remains neutralised so long as it is not used for spending again. Following solid economists, if the amount is large enough, it can cancel out some of the rate of the inflation, though not the full rate of inflation, while the damage it causes is not eradicated by it - this is the work of recession. 

Costello ran surpluses because all that he did was to sign his name as treasurer to spending less than the growth in tax revenues that resulted from the Reserve’s reckless monetary expansion. As Brookesnews pointed out, and warned of as they did it, the Reserve expanded the money supply at a reckless pace. This raised spending and nominal incomes which then raised tax revenues. So long as government spending lagged behind the growth in revenues a surplus was bound to emerge.

What’s worse

1. Small spending Cabinets with a large deficit.

2. Large spending Cabinets with no deficit.

The problem is what drives deficits, consumption. So, Rudd had his December 2008 $10b spend-up, and now tacks on another $42b, both on top of the annual budget. Before consumption can be enjoyed, there must be production and this means savings. Rudd is escalating Government consumption at a time when production is in contraction. He is taking Australians savings and diverting it into spending, when accumulation of savings is required.

No solid economist has railed against deficits per se, so long as they are serviced out of tax revenues. Next, without increasing consumption, in face of recession, the budget can go into deficit. With contraction, of course tax revenues falls. Trying to maintain a massive Government in the face of this certainly does not leave much scope for a balanced budget. Multiplying it in the face of recession is downright destructive folly, destructive of savings.

Costello, in the good times could have lessened the burdens, got off the back of savings. Instead, Costello presided over a near exponential increase in Cabinet spending. Turnbull is not demanding Government spending be slashed. He is all for massive Government.

Costello is wrong on a related matter. George Bush did not cause the recession. Neither did, as rotten as they are, Rudd and his Cabinet.

Time for some solid analysis from an economist

Eslake, receving special mention a number of times:

How confusion about the money supply is damaging the US economy

Economy Swamped by Confusion as Money Supply Goes Wild

Is monetary policy killing Australian manufacturing?

The above is only a beginning point, next week, more will be unfolded. For today, a few more comments and that is it for today:

Turnbull is dedicated to increasing Government consumption. He never attacked it when Costello was Treasurer. He has stated enough to show his position, Government must remain on an obesity diet. He supports additional spending in the form of the euphemistically named ’stimulus package’; disagreeing with Rudd on the numbers, it should be less than whatever Rudd believes it should be. He simply doesn’t have a clue why Rudd’s Keynesian policies should be savaged, and the Cabinet with it.

Turnbull is up a creek in a barbed wire canoe, without a paddle , and they are all of his own making. Rudd is having a real fine time bouncing the rubber ball.

It’s modest Australians, and not those in the sights who will bear the pain of lousy economics.

The hard Left is having a fun time of it, due to the incompetence (buttressed by ignorance) and venality of the sclerotic “Right”. First, there is a troubling aspect of the non-existent economics debate in Australia, typified by comments by Professor (economics),  Professor Neville Norman, The University of Melbourne.

Last week, in a radio ‘discussion’, he asserted there is a risk of recession and it might occur next year, 2010. Reassuring, though, was the boom Christmas spend up that, naturally the media commentariat waxed lyrical over; how splendidly retailers had done, Australia is saved.

However, due to the ‘financial crisis’, Norman continued, things will be difficult for some firms. He recommended investing in service businesses, tradesman is a very good service ‘business’ to be in. This, from a University Professor in economics! Does Norman also hold to the rubbish of the ‘dual economy’, or as McCrann of the Herald Sun put it, the “real economy” and the “other economy” of  financial markets?!

The media commentariat, the idiot “Right” and their anti- free market think tanks the CIS and IPA reflects the abysmal state of what is passed of as the advance of economics in universities. Though, one is certainly not saying one doubts Professor Norman is on the same plane as the likes of Professor Saunders (CIS) and Professor Sinclair Davidson ( CIS & IPA). These two are so unbelievably bad that, to repeat, when I mention their names in the company of other senior economics also grounded in what is imparted in the Universities, they break up in fits of uncontrollable laughter, and so do some heavyweight businessmen.

Professor Norman continued: he regrets his predictions because they have all been bad news. This induced a bit of head scratching over a puzzle. What predictions worth bothering with has he made? To my recollection, none. If he had, he would have long ago commenced attacking the RBA for its criminal Keynesian monetary expansion which sent Australia into recession before 2007, with data throughout 2008 confirming the fact. What Norman’s statements did remind one of is the Delphic oracle. In his mitigation, at least his comments are somewhat more intelligible than the incoherent straining of the CIS and IPA.

I’m not taking Norman the economist lightly. The Professor has a CV that makes those of the developmentally arrested, petulant schoolboys ’s engaged at the IPA and CIS read as those of a 1^st day fresher. Readers can check for themselves here. Neither is it to single out Professor Norman. He is not a-typical of the Universities. That’s the depressing problem.

Australia has been long now in recession. Recession hit before the bursting of the stock market bubble mid last year. Stoock market bubbles are a phenomenon caused by Keynesian monetary expansion. Economic laws cannot be defied without peril, and bursting bubbles are only one nasty, late symptom.

Here’s the latest analysis of another recession we did not have to have but for Keynesian, criminal bastards:

 Economic commentators still clueless about the recession

 ”The latest Australian Industry Group performance of manufacturing index report began with the statement: “Manufacturing activity fell for a seventh month in a row in December”. And still our economic commentators are at a loss as to what this really means. They shouldn’t be. The report is telling us that Australia is in recession and has been for some months. The report found all of its 12 sectors were not only contracting but had fallen below 50. In other words, the sectors showed negative growth. We should not be surprised, therefore, to find that capacity utilisation had dropped to its lowest level 1992.

“Falling back on the fallacy that consumption drives the economy, the authors assert…”

Bingo, that is what professor Norman is asserting, the consumption fallacy. What, Norman, of savings and so production? What of capital theory, and the power of money? To save time:

Government spending makes recessions worse

“Laissez-faire economic ideas (deregulation, tax cuts) are currently out of favour but the fact remains that the Krugman and Keynesian policies of bailouts, deficit financing, and public works have never really worked. They didn’t work in the U.S. in the 1930’s; they didn’t work in the 1990’s in Japan.

“They don’t work because they prop up unsustainable investments in the private sector rather than clear the way for new entrepreneurship…”

What a turn up for the books, ABC radio, Brisbane. The Western Lines drew attention to an interview by ABC’s Steve Austin. His guest was Austrian economist Peter Leithner. Due to the format, Leithner’s explanation is stripped by brevity but he makes some essential points crystal clear:, monetary expansion is the cause, and Rudd’s consumption policies will compound the damage, greatly. He naturally stressed this plank of keynesianism will liquidate what is required, savings.

Western Lines,   Rudd crashing the Australian economy

We will leave this item at that. It is leading into something, but the above is very important to consider, before resuming the item tomorrow, with the attack on the second leg, the “Right’s” non-defence of capitalism.

Readers should attend to the other recent articles on Brookesnews concerning the recession. The media is flooded with, to be polite, misleading commentary and the problem with it is, it is very nasty in its force.

It has been in recession for a couple of years, certainly. The fall in financial markets and rising unemployment are late symptoms of the fact. It hits first manufacturing, which is still contracting and there is something else about this that is worrying. Taxes, indirect (regulation is a tax) as well as explicit taxes can wipe out advantges in manufacturing, and this is cautionary:

When a firm announces it is closing, it cannot be gainsaid why without an in depth analysis. Last Thursday evening, for example, it was reported that two textile mills in Geelong were closed during the preceeding two weeks. One firm was an investment of a US company that folded. What happened to bring it about?

The company that owned the other firm, had been gradually transferring production to other countries over months, including, above all places, New Zealand. In this case, the idiots in the CIS and IPA might automatically, in their dumbed down, mechanistic, over simplifications of intricate matters, say fiat that there is no comparative advantage for those operations in Australians. That regulation can wipe out comparative advantage, however, gives an indication of how intricate it is; so again, what the explanation is cannot be known without a thorough study of the case, and it requires what the idiot “Right” are not possessed of, a thorough grasp and mastery of economics to work through it.

Even more amusing is, the “Right”, particularly when their stellar guru Peter Costello was Treasurer (which is a euphemism for a highly paid book keeper), is responsible for increasing and intensifying regulation (Costello also believes regulation is the rule of law - music to the ears of statists and fascists. The IPA and CIS, far from defending free markets (besides them being entirely incompetent to do it) actually supplied advice on how to strangle enterprise through regulation, and continue to do so. Amongst their many virtues, the sterile “Right” are also liars - there are some of the Left (except the diseased and hard Left types) who would be ashamed of such dishonesty, of criminal force.

However, I’ve digressed; back to another ruddy recession we did not need to have but for keynesian snake oil and the ignoramuses of the “Right”. Making it all the more criminal is, it was predictable, and it was predicted by Mr. Gerard Jackson and Dr. frank Shostak. Their advice and warnings were ignored, again thanks to the cretinous “Right” and their comfy dole offices called the IPA and CIS (they are dole offices, a wealthy man’s version of not compensation for being forced out of paying work but a real good bludge for a pack of lying parasites, and not one of these swines would be offered a real job in a real firm, they are forever unemployable).

Some headlines

It’s a bit thick for one of the immediate culprits for the recession to wring his hands while engaged in pouring out more arsenic, Mr. Glenn Stevens of the Reserve Bank of Australia. This is mystifying:

“The most striking economic fact of the past several months is not continued US economic weakness, but that China’s economy has slowed much more quickly than anyone had forecast,” he said.”
RBA chief Glenn Stevens warns growth in China is slowing, Herald Sun, 10/12/08

Not that China is in recession, though this is a mystery for Stevens. What are the other two “striking things”?
Assuming Peking hasn’t swallowed keynesian snakeoil, that production in China, and not only consumption goods but also capital goods, would be hit by the criminal actions of central banks in other countries, recession would set in, in China and it is. Manufacturers are cutting their stockpiles of iron ore, as production of finished materials is scaled down, as production of other goods is scaled down. Australians detect it, they are witnessed the share prices of even the giants in mining smashed. So, all we have to do now is turn to Brookesnews and read, for example:

The US dollar and China’s impending recession, part I, and Part II, Jackson

Will the US economy suffer a downturn?, Shostak

Did Bernanke learn the lesson of the Great Depression?, Shostak

In the same report:

“Despite his gloomy assessment of China’s present position, Mr Stevens believes Chinese authorities are moving policies towards stimulating growth after years of trying to slow its overheating economy.”

So, Mr. Stevens, China should commit keynesian suicide, which is what Obama and the Stalinist Democrats will do to the US, and Rudd and Swann are down the road to doing to Australians? So, if China does as Stevens suggests, it won’t turn out as he suggests:

“So there is a good chance that China’s economy will be looking stronger in a year’s time than it does today,” Mr Stevens said.”

Then there is:

“But NAB chief economist Alan Oster is tipping the Federal Government will need to spend another $25 billion in fiscal stimulus over the next six months to offset the downturn in China and keep the Australian economy out of recession.”

If consumption, government consumption drove growth, and can deliver recovery, why before this recession, the umpteen billions of dollars the Kennett Cabinet, then Bracks and Brumby blew on games and other scams should have seen Victorians in the height of prosperity. It should also be noted various Ministers in the Howard Cabinet multiplied consumption by a large factor - where’s the economic paradise that, according to these geniuses, all Australians should be luxuriating in?

Terry McCrann

In Saturday’s Herald Sun, McCrann declared it is official, Australia is now in recession. This after:

- Until September, he maintained Australia wasn’t in recession, indeed doing rather well, with the RBA turning the monetary screws the right way.

- In September, no longer able to ignore what was by then unmistakeable, he decided NSW was in recession, that Victoria was uncertain, but the WA mining boom would save Australia - ignoring, amongst other things, not merely the weight of manufacturing in Australia but also that it supports mining operations.

- Then, when the mining boom came to an end, shortly after, he declared the now Australia wide recession was entirely predictable.

What difference does an official government statement make, by also blanks in economics, escapes me. McCrann repeated, “it was all predictable”. Now, I could have missed something but McCrann, as also the RBA, and the commercial banks’ economists, and the IPA and CIS, are noteable for one thing, not one of them predicted the recession. Their records are as barren as their economics.

Reduction in consumption is not recession

This is the ‘explanation’ the above are giving for why Australia is only now, they claim, in recession, or according to other snakeoil salesmen, could slide in recession. Consumption doesn’t fall in recession.

The reason for this item should be plain. The news was not only awash with the above garbage, all last week to Tuesday, and is still pumping it out. It is awash with the no longer mere fallacy but, because of its destructive force, the lie the Government must follow the keynesian progrom and spend, spend, spend. The man in the street believes it, not that this is novel. It has been ground into school children over many decades, the best part of a century. This is dynamite, because taken with the ignoramuses pretending to be economists, the Rudd Cabinet far from being deservedly eviscerated for his multi-billion squander, reinforced by Bracks’ announcement of an extra $40b spending, is applauded for it.

The man in the street doesn’t wish to be sunk in recession, and as daily speech shows, they are very concerned that Australia comes out soundly and consistent with the school room indoctrination, it must meen massive consumption by governments, matched with make work schemes.

The “Right” is responsible for what is a disastrous state of affairs. Turning to Monday’s edition of Brookesnews, the editor has rightly found this more than irritating, so it is timely one can link:

“If this lot had a grasp of basic capital theory they would be forced to conclude that directing spending to consumption will surely make matters worse because business spending is what keeps the economy afloat. Therefore an expansion in consumer spending could come at the expense of manufacturing.”

The country is in recession yet the commentariat still cannot spot what is wrong

Malcolm Turnbull’s savage attack on the Keynesian spending spree of Rudd and Swann is to complain it lacks “quality spending”. Whatever that is supposed to mean, it is abysmal, but there is nothing between his ears, nor Julie Bishop, too many Liberal MPs and their advisers.

As for the Centre for Independent Studies, well they get much else completely wrong, but at least they are consistent, with their fundraising extravaganze euphemistically called seminars, on the recession. They are devoid of any notion of the power of money, as well as capital. However, to help Turnbull and Bishop out, here’s a suggestion for “quality spending”:

Send me a check for 2 $million, and I’ll buy a rolls royce and employ a man to look after it, another to drive it, and spend a generous amount on mechanics. It also means spending, obviously, on a multitude of car maintenance products. Now, according to the economic morons in both major parties, this should help strengthen the economy, defend it against recession, and lead to economic growth. As nice as it the wheeze would be, the objection should be transparent, it does nothing at all to yeild what is required. Only savings can do the work.

The pox is the media commentariat who, sharing the same delusions, fear recession is setting in because, well, because consumers might not spend so much this Xmas. Neither the Rudd fascist Cabinet nor the idiot “Right” have anything to fear from the press.

Swann boasted today, “all arms of government are deployed in combating recession.” Great, an octopus, waving its tentacles about. He was referring to not only the Cabinet’s larceny, but also to Glenn Stevens and the RBA’s effort to reinflate, engage in monetary expansion, the very thing caused the mess in the first place, with a 1% cut in interest rates today.

Turnbull and Bishop freely use a queer expression, ‘inflation genie’, and doggedly hound Rudd and Swann with it -’you let him out of the bottle’. It’s scary, on the one hand there are the morons in the Cabinet but then there’s Turnbull, Bishop, Helen Kroger, and a drepessingly long list of dumbkops who believe they are Ministerial talent too.

The whole lot of them share one common belief, they believe there is machine called an economy, and as long as the handle is pulled the right way, it will tick over. This is so abysmal that they should be censored, it is harmful to children but then, that lot are developmentally arrested and so they don’t realise they are an offense to reason and sound economics, as well as to the Liberal Party. “Ga ga” doesn’t do this lot of cretins justice.

As the “Right” struggle to find a clue, Rudd is determined to press ahead with economic destruction day through carbon taxes, as his ministers for the Greens’ cult of death announced in Parliament today. It is disgusting the “Right” fully support it. Making this all the more risible is, Rudd is facing a back bench revolt as these MPs know what thyey face, the fury of ruined Australians matched by electoral annihilation. All the “Right” can do is blow bubbles out of annoyance - because it is Rudd and not they who has the joy of immiserating Australians through carbon taxation and thus destroying Australia.

While these slobs play games with the lives of Australians, other countries are waking up to what the Greens’ great lie, man causes global warming, is all about and what the real force of carbon taxes is. The following item is just one of many reports on the growing revolt against the thuggery:

The Real Cost of Global Warming, By Ben Lieberman (Front Page Magazine, 1/10/08.

Greg Lindsay is still his CIS’s lobbying for carbon destruction day. In the past, the claim the CIS is a free market think tank, rang hollow with comic twist. That lot have given up any pretence to being so. Their desperatefund raising activities, amounting to nothing more than getting between donors/ potential donors and their bank accounts and sticking like an octopus to the latter, gives the game. This lot have helped to wreck the Liberal Party, genuine Liberal causes; have discredited free market economics and have betrayed Australians and Australia with it. What a pack of professional dole bludging bastards; and such as the above (including the Brown Pantalooned Cabinet) is the upshot of their stupidity.

Tomorrow, readers, we return to how the “Right” paved the way for Soviet style central planning which the Rudd Cabinet, through Kim “Il” Carr is now ready to launch against Australians, and again the CIS has a starring role, particularly their No.1 gun economic illiterate and gun coward, Professor Sinclair Davidson - where is that paper, “Sinkers”, in which you attempt indefensible - “Sinkers”, folks, seems to hold the peculiar notion the invers of the J curve cannot be true, and we restate the importance of this, and why Jackson demolished a paper by Davidson and Berg in which they called for Soviet style planning!

The HR Nicholls Society asserted as its “case” for labour free labour markets is, it will raise productivity. This is compeletely false. Relying on their incompetent, beyond redemption, advice, and being idle and illiterate, ministers in the Howard Cabinet, latched on to it and repeated it ad infinitum. The HR Nicholls Society destroying the fight for free labour markets, and capping their success by blowing the Liberal Party out of the electoral waters, lead to the current unamusing situation with Federal MPs unable to eviscerate the Rudd Cabinet over its labour market measures, which reverses any progress back several decades, try 7, 9 or more, the best part of a century. What an achievement, by the nepotistic “Right”.

Free markets clears unemployment. The problem of enduring unemploymet is one of effective minimum wages - ie. rates higher than market rates. Only capital accumulation raises real rates. To simplify, it’s beyond doubt who earns the most, a man using his bare hads to plant a thousand acres, or a man who uses modern machinery. With this in view, in this item two points about the Cabinet’s measure are picked up.

What they are about to do is impose effective minimum wages and effective minimum wages can only be obtained by coercion, which by definition must be criminal in common law too. Gillard, as the ‘Minister for Employment’, is about to not only impose effective minimum wages, but institutionalise long term high unemployment as the consequence. This was a major evil under the old anti-free market and anti-common law Industrial Relations fraud. This will, naturally, compound short term unemployment due to the recession which didn’t occur this year but has been under away for a about three years now, thanks to the RBA and keynesian snake-oil.

Nor should it be overlooked that make work schemes, which will be increased through Rudd’s $10 billion plunder and squander, are not real employment; those engaged in them are unemployed. They are the dole by other names. This is only the tip of the ice-berg but the force is clear and disastrous, real unemployment rates might be far higher than official unemployment statistics indicate. So, the Cabinet is about to add to the woes of the unemployed with a vengeance, but at least Shane Burrows and her fellow thugs of the ACTU will be happy.

The second point has a black twist. The Cabinet is running the line, labour in itself increases productivity. One ALP member has cited in Parliament today that diseased Leftist, Kenneth Galbraith, as an irrefutable authority - and Stalinist regimes applauded him too. Mind, there is precedent in the ALP, the “Accords” during the Hawke Keating years, in which notional ‘productivity gains’ were supposed to be the trade off for increases in real pay, under centralised wage fixing of course.

Mind, there is an exception that is not a contradiction. In so far as employers are freed to combine factors of production, there can be an initial rise in productivity but no more without capital accumulation. It is also pointed that Jackson took pains to explain from within the framework of prices of labour, an initial but short lived rise in productivity can occur when labour labour markets are freed but then falls off, and this is explained from the theory of the marginal productivity of labour.

Jackson, Labour Market Wars

An exception only. The Cabinet is arguing, to make it plainer, lab our itself raises production and, it follows, thus rates of pay. It reinforces this rubbish by asserting, if Australians expended more time in courses, to acquire ’skills’, they will increase their productivity. Well that clears one thing up, the army of the certified makes machine weilding cropper look like a medieval serf, break. Why, equipped with their papers they should be able to farm 10,000 acres each, or produce twenty thousand tonnes of canned foods each, using only their bits of paper declaring them skilled.

Needless to say, so far up a creek in a barbed wire canoe, the Opposition can only look across the floor as only the completely stumped do, but they blow bubbles well. The trouble is, they are blowing bubbles from within a deep grave. They are in no position to attack Rudd’s keynesian spending spree. They accept the falsehood, consumption raises growth. It hasn’t occurred to them that, if true, then consumers can freely drive it, and that governmet consumpotion is nothing more than polticians dictating what consumers will and will not have and at far greater cost than in free markets, if valued at all.

Consumption is only 1/3 of spending. GDP is false. 2/3 is where it should be expected, on capital goods. This means savings. Bye the way, themselvesd having swallowed the keynesian lies, the Liberal MPs do not see that Rudd’s spending spree can cause real damage, beginning with, it is the confiscation of savings and blowing them away.

The Rudd Cabinet is not only asserting that its ‘labour market reforms’ will raise productivity. It is claiming they will compound economic growth. Employees will be paid, more and so will spend more on goods and services, and this will, what? Yield capital accumulation! And it will be greater because productivity of labour will shoot through the rood. Again, the ‘Right’, being completely stupid, have not eviscerated the Cabinet for these obvious, infantile lies.

Yes, that is correct, the Rudd Cabinet has tied keynesian arsenic and strangulation of labour markets together as the ’salvation’ of Australians from recession. This shows how bad the “Right” are. They simply cannot fathom how destructive Kevin “little Mussolini” Rudd’s measures are, and why they are destructive, and worst of is, they hold to the same garbage.

In the meantime, after a period of deflation, December 2007 to August, it looked as if the RBA is trying to reinflate (try this at home folks, if you wish to spend a long time in Hotel Prison). It turns out, it’s true, and the RBA is working hard at it:

“That the Reserve was desperate to reverse the deflation is indicated by the September figure for M1 which now stands at 243.1 while bank deposits are 202.3 as against 192.2 for July.”

The economy slides into recession while the Pollyannas look the other way,Gerard Jackson.

Between the Rudd Brown Pantalooned Cabinet, the Idiot “Right”, and the RBA, the rotten truth is, together they can really cook Australians, and this before contemplating economic destruction day through Co2 taxes. To draw this out:

Having already written on, the markets had corrected the bubbled, caused by central banks engaged in monetary expansion, the ongoing free fall in markets for capital in US investment is due to the election of Obama and his economic policies. The telling what the future is under Obama and his chums of the US Stalinist Democrats, disaster. I look at what they are preparing to do to the US, and too much of it is what the Rudd Cabinet is all about.

Oh, and Rudd is now working on sacking superannuation funds in order to increase the scale of his spending spree. Can he get away with it? It might be assumed it is criminal, but the gutless blobs of the “Right” are addicted to plunder and squander too. They all call it by that ugly euphemism, ‘infrastructure investment’.

There are some important dis-analogies, but comparing Rudd to Obama is more than disturbing. Just to check, consider:

America is in recession and the Democrats are to make it worse

Yes, Sir, that sums up the Rudd fascist Cabinet too.

Mr. Terry McCrann, this is ridiculous. Having failed to predict the recession a decade ago, because he is an economic illiterate (stick to your strength, as pedestrian as it is, financial commentary), he was certain until September this year that everything is “hunky dory”. Contradicted in September, McCrann sought refuge in saying what he had not predicted:

‘NSW is in recession, Victoria might be at a slight risk, but the WA mining boom will save all Australians anyway’.

He didn’t consider the last claim, the mining boom would carry all forward, a risibly false claim and why it was so. When the mining ‘boom’ blew sky high, he turned around and said, ‘the recession was predictable’. I’m puzzled as to how can McCrann explain his contradiction, because it is no true paradox, as his record shows.

So, while one agrees with some of McCrann’s latest sentiments, it is pointless praising the man when he makes “Johnny come lately” look like a speedster. Sentiments only, because his latest pronouncement is his regular drill, dicta issued absent of economics:

Brumby goes back to the future on protection

Let’s take a real free market economist in action, as a pointed contrast:

Brumby urges Rudd to repeat the Whitlam disaster and flood the economy with ‘cheap credit’

What’s worse for McCrann is: I do not have Jackson’s mastery in economics - depth in theory and history of, but by attending to fine economists, their theoretical work - applying to it, oneself has managed far, far superior commentary than McCrann (and, blast, I’m still waiting for Davidson to refute what is otherwise true, the inverse of the “J curve”).

Why, even what McCrann attempts I dealt with swiftly today, but MacCrann’s genius is always manifested in the incoherence of his drivel. MaCrann stands in heavy company, the likes of Professor Saunders of the CIS, and Professor Sinclair Davidson of both the CIS and IPA and the expensive ‘childcare centre’ called RMIT. They all are good advertisments for hindsight driven by clowning around (this is what passes for learned wit for Davidson and Saunders, though Davidson takes a jaundiced view of wit - for him it must be augured by smearing his superiors such as Jackson).

You see the point readers, illiterates pretending to be masters in economics - the media, CIS and IPA, Davidson, don’t simply make a mess of grave matters. It is because they don’t have a clue as to what they are supposed to be analysing that the likes of Brumby, Rudd, Turnbull, Bishop, Peter Costello, David Kemp, Swann, Penny Wong, Glenn Stevens and the RBA exist and trample over Australians. Well done, McCrann, you blithering, hypocritical idiot. The likes of McCrann ensures that that lot of criminal cretins have oxygen.

I can’t wait for the next instalment, “McCrann saves Australia, the US, and the entire world.” Spiffing, simply spiffing brilliant. Give him a gold star to stick on his next ‘econ’ thesis, written in crayon on butcher paper. Then, then Mcrann can return, satisfied, to his comfy home, the grave. A Zombie’s job well done.

Thus began Jackson in an article. They are degenerating, going from wrong to hopelessly confused.

Westpac released it’s latest economic report, which concludes Australia is heading into a recession but in the 2nd half of next year, recovery will commence. Australia has been in recession since before 2007. The problem with Westpac’s report and forecast is it commits the same fatal flaw to which the RBA and the commentariat are addicted to, keynesian snakeoil, of the report the fallacy consumption drives growth and, conversely, reduction in consumption means, what, recession - this fallacy is behind the hysteria of the commentariat. This fallacy is the meaning of the Westpac–Melbourne Institute Leading Index.

The report commences with a lapidary statement, “it fell 3.5% in August 2008 to 1.1% in September 2008″. It continues:

“… the first quarter of 2009 is likely to show negative growth following the “one off” boost to growth in the final quarter of 2008 as households potentially spend up to 40% of the $8.4bn which will be paid directly by the
government on December 8 as part of the $10.7bn fiscal stimulus package.”

This is abysmal, and it is not leavened when the contradiction is noted, consumption doesn’t fall off in a recession, it rises. Even more idiotically, there is a glaring contradiction in the report itself, turning on what they define as economic growth/recession, consumption. Asserting because it is falling recession is here, in the next breath it states, consumption is about to shoot vertical.

Leading Index growth rate collapses, Bill Evans, Chief Economist, Westpac.

The media, are clueless, as this by the Herald Sun shows:
Economic growth slumps, boosting recession fears

Next to renewed spending on housing, it sheets the driver as a massive increase in Government consumption. Now, unless the Cabinet and Treasury have their own money forging press, it comes at the cost of one thing, taxing capital and thus liquidating it. It is plain for Keynesians, capital, capital accumulation, and theory of it counts as much as it does for the Centre of Independent Studies and the IPA, they are totally bereft of it. By some miracle, politicians pissing stolen private property up against a wall builds capital ex nihilo, instead of savings.

In other words, Westpac is totally ignoring what the burden of keynesian spending sprees hits. It means they are also oblivious to the real danger, politicians can compound the damage inflicted by the real culprit, kenyesian monetary expansion. The damage has been done, the only policy is for politicians to eschew keynesian aresenic, let the recession do its work in eliminating malinvestments due to the monetary disruption caused by the central bank, and get off the backs of Australians, savers, entrepreneurs and sound production and capital accumulation. Instead, Rudd, playing Father XMas (an insult to the Saint - who wasn’t a little idiot of a fascist slob) is busy plundering Australians and handing it over to armies of parasites, and yesterday it was the turn of the petty tyrants, Local Councillors - billions for them to indulge in collectivist measures they call “commooooonity groups and services”.

Having defected on their obligation, maintaing roads and footpaths and taking out the trash, they plunder rate payers and throw it down the necks of the unemployable. They then have the hide to whine they don’t have the revenues to do their only and bound duty to ratepayers. Now that Rudd will throw billions at them, they will expand their squander and come next year, reach deeper into ratepayers pockets to prop up their new level of ‘happy times for ticks are here again’.

Realising there might be more to it and wishing to save face, diseased Leftist, Geoff Elliot, wrote:

G20 goes short on monetary policy

He must have read Brookesnews, but he still cocks it right up, as he proceeds to a bit of US bashing. Trying to be wise long after the fact, as did the IPA’s Alan Moran is a bit like a cripple running sprints against champs. Elliott, as Moran, did not nail the cause of the recession, central banks around the world and their monetary expansion, which came to an in 2007; worldwide monetary disruption that central banks have been committing over many years until late 2007. As Jackson shows, in the article linked above, from December 2007 to August this year, monetary policy has been deflationary.

NB, yes I promised a festchrift but, unhappily matters had to be dealt with. The point to the above, is how bad the state of economics is in Australia, a telling reflection on the Universities. After all, they produced the commentariat, the Keynesian gurus in banks, the buffoons in the IPA and CIS. The rotten thing is the force of rotten economics when acted on. Rudd is only about punishing Australians more, cheered on by the likes of BCA and Westpac. Dreadful, deadly, brutal stuff it is but who said arsenic was anything but deadly poison.

Last Friday, Wall Street, share prices tumbled. It wasn’t the financial crisis. The markets have wiped out most of the Central Banks’ keynesian generated bubble and wiped out firms built on nothing more than the funny money pumped out by central banks until late last year. No, US financial markets dropped as the force of the Obama lead US Democrats Party Presidential victory hit home.

Investors future expectations are:

1. Obama’s ‘economic policies’ will kill recovery
2. Destroy capital
3. Will induce a flight of capital out of the United States, a massive flight of capital out of the US.

They see no good future for sinking new capital into the US at all. That is what they firmly stated as they wrote down capital on Wall Street. Americans are in for a very nasty time of it.

A number of investors interviewed late last week wrote down their investments for reason no. 3, pinning it to Obama’s socialist policies - ‘they will grind the US into destitution’. One excellent reason is Obama’s promise to confiscate capital, through capital taxes (to enjoy an orgy of a spending spree - as well as buying the Stalinist Party an additional voting block). Investors in the US are investigating other countries in which to sink precious capital.

Australia could be a beneficiary of that flight but for one objection: the politicians have been strangling economic advantages of production in Australia through regulation and punishing taxation, by ‘each tier of Government’, over decades. This is in addition to wiping out property rights in a manner worthy of Mussolini. Rights in many types of propertry now, at bottom, exist only in name - Henry owns the property. Why, only a couple of weeks ago that boof-headed cretin of the Brumby Cabinet of juvenile, diseased Leftists, Justin Madden, by fiat wiped out more rights of property owners.

For readers unfamiliar with boofhead, he is an ex AFL player who was made wealthy by modest peasants duly handing over club membership fees, buying merchandise, doggedly attending football matches, and firms paying sponsorship to the club he played for. This ignoramus didn’t get wealthy because he’s an entrepreneur. He was made wealthy because of the fans he know kicks in the face.

While wiping out property rights and generally saying hear hear to every totalitarian measure the Bracks and Brumby Cabinets ram down, boofhead whines when AFL clubs’ property developments are opposed and on the grounds of the anti-property rights measures he and his fellow thugs, and their idiot inbred cousins in local councils ram down. To add insult to injury, he sees nothing wrong in robbing Victorians blind to enrich his fellow boofheads and their clubs, and throwing more at all sorts of sports. According to these geniuses, stealing massive amounts of private property and squandering it on sports, and making a lucky few wealthy as the consquence, is generating major economic growth. Not that the congenital idiots destroying the Liberal Party are any better. To the contrary, their only disagreement with Bracks and Brumby administrations is a long standing niggle only - ’spend it on this, instead of that’.

Boofhead, as Bracks, Brumby and the Reverendress Bronwyn Pike has the intellectual agility, depth and breadth of a retarded snail that died in the Simpson Desert half a century ago. This says a great deal about the ‘talent’ occupying precious Liberal seats in the Victorian Parliament and rather many in Federal Parliament are on the same ‘wave-length’ - ah, and so are those buffoons in the IPA and CIS ( who did much to pave the way for the Bracks-Brumby and Rudd administrations - What great ‘guns’ you are funding Mr. Manners, a pack of dole bludgers who have wreaked real carnage in Victoria and Federally).

Having digressed, to continue - and things are no brighter in view of what the States’ administrations and local councils are doing. They keep on doing what they do best, strangling Australians. Now Rudd, and his great central planning schemes, and using the recent ‘financial crisis’ as an excuse to further overthrow free markets and impose Soviet style planning that economically destroyed Russians and millions of East Europeans with them.

The only sound path is for politicians and bureaucrats to cease and desist from pumping down the throats of Australians more keynesian arsenic and do nothing, just get right off the backs of Australians -

Why Keynes is not the answer to the financial crisis Dr Frank Shostak

Monetary policy: Is the fed pushing on a piece of string? Gerard Jackson

Let businesses fail Amit Ghate

There is every prospect the Rudd administration will render Australia hostile to investment. His Fascist aims are solid reasons as it is. Then try his announcement that he will make ‘cartels’ a major crime in Australia. One of his immediate targets is BHP and Rio Tinto and in particular their railway lines. Terry McCrann got this wrong (what else is to be expected from that economic illiterate?) in:

Sharing with foes

BHP’s and Rio Tinto’s railroads are their shareowner’s private property and as part of each company’s capital structure. ‘Cartel-busting’ is rooted in the fiction of perfect competition in which competition is falsely defined as market concentration. Cartel busting is aimed at breaking up economically efficient companies and with it is a destruction of free markets. This is on top of, the Rudd Cabinet is making an obvous attempt to steal private property in the form of those companies’ rail roads. McCrann did not nail any of this at all in his article; it was his usual vapid posturing.

It might be noted that the IPA and CIS have never attacked neither ALP nor, for that matter Liberal Party Ministers for their anti-free market, company destroying ‘anti-cartel’ activism through the ACCC. To the contrary, these clowns have helped governments to impose regulatory strangulation and company busting measures.

Mr. Manners, how can you fund the anti-free market thugs in the IPA and CIS . They are supposed to be free market think tanks. Worse, they are on the take. These slobs take taxpayers money in the form of consultancy fees and abet governments to destroy free markets and companies. They have been doing this for some decades now. Compounding their glaringly obvious defects, the CIS has surrendered any pretence to being a free market think tanks and calls for total economic destruction of Australians through Carbon taxation, and has serious conflicts of interests. Can Mr. Manners explain how all this treacherous thuggery is the height of independent, robust fighting for free markets? Can he explain how their intellectual fraud is the height of solid free market reasoning? Good luck Mr. Manners.

So, the Rudd-Swann road to recovery is:

- Destroy what remains of free markets in Australia

- Grind Australians into the misery through taxation

- Throw the stolen proceeds down the toilet

- Declare successful entrepreneurs criminals for merely being genuine entrepreneurs, unlike, for eg., blood-sucking parasites behind ‘alternative energy’ scams

- Impose Soviet style central planning

To cap things out, finish of Australians entirely, impose capital destroying Co2 taxation, with the support of the morons pretending to be Liberal Party MPs, and the completely gaga who see nothing wrong with betraying Australians and immiserating them the CIS.

What does any sane and reasonable reader genuinely presume the prospects for Australians are? Well, investors in the US are preparing a one way flight out of the US. It can occur here too.

The market wobbles seem to be coming to an end. They were only the late sign of what has been in train for some time, recession. The hard left have been blaming capitalism, instead of the anti-free market poison of Keynesianism, - any lie the the diseased Left can sieze on is the truth. Unfortunately, the dunderheaded “Right” and their clunker tanks the CIS and IPA are in no position to eviscerate the Left in public.

Over the weekend, a Professor of Economics and, unmistakably, hard Leftist blamed the crisis on ‘free market ideologues’ It is clear whom he was attacking, the “Right” and their clunker tanks. The ‘Professor’ was more than a tad mendacious. The clunker tanks have not advanced free markets at all. To the contrary, they discredited them. This is apart from, they are voids in free market economics. There it is, the Left are wasting no effort in their attempt to identify free markets with the garbage the Right have poured out, including privatisation.

Worse, the lies told by the Left have taken a stong hold where it counts, the man in the street. Unarmed, the modest man voices the same sentiments. This is a disaster, and all this is why a Leftist professor felt safe in coming out - noting he also feared nothing from the gutless “Right”.

This is what you are spending your funds on Mr. Manners - the IPA and CIS who have handed unwarranted victories to the diseased Left, while simultaneously thoroughly sapping the sound fight for free markets, and this lot smearing, for good measure, genuine Liberals. What a spiffing $40m plus success! Mr. Manners has decided to reward that lot of destructive parasites with more good money! This is bizarre.

Mr. Manners, the Left, much encouraged by the Rudd Cabinet of fascist morons and now the election of that lying, diseased thug called Obama, are now in the business of destroying free markets. In Australia, the clowns you are funding are responsible for this abysmal catastrophe. Thus another “Professor of Economics” and hard Leftist feels free to risk his professorial standing and tell a pack of lies in public, in order to attack capitalism and thus freedom.

It is worth mentioning that though I did not hear that ‘professor’s’ name it certainly wasn’t that liar, Professor John Quiggin. The import of this is, treacherous leftists in Univeristies no longer fear losing their reputations in going public. Consider what this means, Mr. Manners. This is what those clunker tankas are also responsible for.

I apologise readers, for the umpteenth time in a row for brevity. There is still a bit on the plate to deal with, and it is irritating. Tomorrow, Friday, crossed fingers, I will belt out what I have in store.

It refuses to correct its disgusting deception of calling on the apologist for Stalinist regimes and Marxist thug, Burchill, to supply ‘expert’ economic analysis and commentary for its listeners. I emailed 3AW again, yesterday, furnishing material to demonstrate the gravity of what they have done viz Burchill, and also in regards to the rubbish they pump out as expert economics commentary. They are keeping stone cold silent.

On the recession and financial crisis, he was no worse than all the other commentators spewing out arsenic oon 3AW, including Terry McCrann. There is, however, a difference, Burchill is ideologically driven, as Quiggin is.

What is wrong with it? Only that 3AW’s listeners are modest Australians, and they are, quite understandably, very disturbed about what is unfolding. Their uneasiness is not helped by poo flung out as well reasoned analysis and commentary. Right now, that clown, Neil Mitchell, is parrotting the keynesian poison poured out by the dam loads by RBA, Rudd, Swann, and Gillard.

Runnning oracles as economics commentators is itself cheating listeners. Putting on a diseased Leftist thug called Burchill is fraud. It is plain why 3AW is keeping stone cold silent:

- As the incompetents in the CIS, IPA, and HR Nicholls Society, they cannot admit they are completely stuffing things up, and abusing their listeners as a consequence. Indeed, the feebleness of the CIS, IPA, and HR Nicholls Society, and their abject dereliction in their duties as think tanks, is why 3AW feels secure in cheating its listeners, and refusing to seek out alternative sources who can do the work required.

- A vain notion that if they ignore challenges it will all blow over and they can continue pumping out snake-oil. Wrong!

To 3AW, what you are responsible for is called intellectual fraud, and on very grave matters which, if not addressed correctly, can see great damage caused by Rudd and his Cabinet of fascist cretins and ably assisted by the dribbling village idiots that hold Liberal seats.