Tag Archives: The Australian

Strewth! He’s Got It … “Joyce The Prophet”

28 Jun

At long last.

Well done James Jeffrey, author of the Strewth column.

From the Australian today:

REMEMBER back in 2009 when Barnaby Joyce pondered aloud the possibility of the US defaulting on its debt?

Just to recap in the concisest way, things went badly for Joyce. We found ourselves pondering this yesterday as we listened to the dulcet tones of the ABC’s Eleanor Hall on The World Today: “. . . the [US] Treasury has warned that Congress has only until August 2 to come up with a compromise to lift the $US14 trillion debt ceiling or risk a default and a default would have drastic consequences, not just for the US but for the global economy”.

Is the time approaching where Joyce must be acknowledged as a clear-eyed prophet?

Strewth found him in a reflective mood.

“Maybe they will retract their pillaging of me and hand back the shadow finance portfolio as the sun is blotted out with the return of the migrating pigs,” Joyce mused.

“Alas, Cassandras are rarely enjoyable company in any party. It was hardly the greatest feat of the prefrontal cortex amygdala [utilised for intuition, he explains] to foresee that one, but politically it had to wait for the economic karaoke to bravely sing all together prompted by the big bouncing cheque.”

Amen.

Just as this blog has been proving, with news articles and economic information from around the world, ever since Barnaby The Prophet bravely made the Big Call.

Barnaby was right.

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The Australian Cognitive Dissonance

25 Jun

Interesting front page to The Australian online today.  The following lead stories displayed as shown below:

BUSINESS LEADERS: Boom fracturing our country

PAUL KELLY: Alarm bells sound on economy

GEORGE MEGALOGENIS: Our economy’s fine

IN DEPTH: Stop complaining, our economy’s fine

And this is widely considered to be the premier national newspaper?

No wonder the country’s a mess.

Media Confuses Millions, Billions

11 May

Oh the joy of being an unaccountable media scumbag!  Having the power to destroy the credibility (and ministerial career?) of Senator Barnaby Joyce for a mere slip of the tongue over “millions” and “billions”… yet not even being able to get it right yourself.  In print!

Count the number of times two different “esteemed” media services have got it wrong themselves in this news story, from The Australian, via AFP:

Europe agrees to aid package with EU and IMF funds that could top $1bn

From: AFP May 10, 2010 – 11:08AM

  • Europe to give $630m in aid
  • With IMF contributions aid could hit $1bn
  • Struggling euro expected to surge on deal

EUROPE has agreed a package of crisis aid for troubled eurozone countries totaling “more than 500 billion euros,” ($718 million) which will be topped up by the International Monetary Fund (IMF), a European Union diplomat told AFP.

The fund would be made up of €440 billion from eurozone countries and another €60 billion of loan funds coming from the European Commission, with more again from the IMF, the source said.

Spanish finance minister Elena Salgado suggested the IMF’s involvement could take the package up to €720 billion.

I’m guessing that the total amount they’re talking about – the figure that should be in the headline – is $1 Trillion. And therefore, that the “more than 500 billion euros” mentioned in the first paragraph should have had “($718 billion)” written after it.  And not “($718 million)”.

Cretins.

Is Mr Stutchbury Waking Up?

16 Mar

On February 28th I firmly criticised The Australian’s economics editor Michael Stutchbury’s column, “Chinese Can Fund Our Boom” (see my article here).

Well, it seems Mr Stutchbury may be (reluctantly) waking up to reality, if his column today is anything to go by. Though he cannot yet bring himself to let go of the fantasy entirely:

China Won’t Boom Forever

The big risk now is that, having escaped the global crisis, the Lucky Country thinks it’s bulletproof and the rebound in our iron ore and coal export prices means there is no penalty for bad policy.

The airbag of a US50c-US60c dollar cushioned the economy from the 1997 Asian financial crisis and the 2000 Wall Street tech-wreck. Our new China fortune pulled us out of last year’s global recession.

As a result, Australia is about to enter its 19th straight year of economic expansion, possibly the longest unbroken growth in our history. We appear to be heading into a bountiful decade or two of high commodity export prices driven by the rise of China and India.

But now, no doubt in reaction to Chinese Premier Wen Jiabao’s warning yesterday of a global double-dip recession, Stutchbury hedges just a little on his previous blind confidence:

But this new growth phase is bound to be volatile. And there is a smaller probability but higher impact risk that the mega China boom – like the 1980s Japanese bubble, the 90s Asian boom, the technology boom or the US housing bubble – could burst. We can’t count on being able to avoid a fair dinkum recession during the next decade.

Indeed. The fact is, many authorities around the world are predicting the China bubble may burst by 2012. Including some, like former chief economist for the IMF Ken Rogoff, who did predict the GFC in the first place.

I wonder how long it will take for Mr Stutchbury – and many others in the Australian mainstream economic media – to stop publishing reactions to the latest proclamation by an “authority”, and start researching widely in order to  think for themselves?

Perhaps he might take a lead from the Sydney Morning Herald’s Paul Sheehan, and his excellent and insightful article yesterday.

Stevens’ Nonchalance ‘Stunning’

2 Mar

This excellent article by David Uren at The Australian suggests that he may be the only mainstream journalist in Australia who is awake to international developments, and not in awe of every utterance from RBA Governor Glenn Stevens:

If the Reserve Bank raises rates again tomorrow, it will risk repeating the mistake it made in early 2008, when it failed to see the global financial crisis coming.

Now, as then, it is beguiled by soaring commodity prices and believes Australia can shrug off what it sees as essentially local woes in the industrialised world.

In 2008, it was the subprime crisis, and today it is the sovereign debt crisis, focused for the moment in Europe.

Glenn Stevens’s nonchalance about the Greek debt crisis at the recent parliamentary hearings was stunning.

It had been no more than a marginal influence on the RBA’s decision to hold rates steady in February, he said.

“There is a bit of uncertainty about how all of that is going to be resolved. I do not think, myself, at this point, that those issues will directly present a serious problem for Australia. After all, it is a sovereign debt issue for Europe.”

Europe still represents about a quarter of world GDP and its unity and sound finances matter a lot for global financial stability.

US academics Kenneth Rogoff (a former IMF chief economist) and Carmen Reinhart have been among the most influential analysts of the developments of the past two years because of their analysis of crashes in 66 countries stretching back two centuries. “Serial default remains the norm,” they say.

There is often a lag of some years, leading policymakers to believe “this time it is different”.

Rogoff, who did predict the GFC, is currently warning that China is in a bubble, one that he believes will burst within ten years. If so, then so much for the belief that Australia is on the verge of a new China-fuelled mining boom.

Glenn Stevens appears to be in a bubble of his own, oblivious to the ever-growing warnings from leading international economists about the Eurozone crisis, and/or a new Asia Crisis triggered by the inevitable bust of China’s real estate bubble.

A man who apparently does not learn from his epic failures of the past, should no longer be permitted to retain such enormous power over the economy, and the lives of 22 million Australian citizens.

Stutchbury Sees The Angel Too

28 Feb

Brandishing the headline “Chinese Can Fund Our Boom”, The Australian economics editor Michael Stutchbury sees that Chinese cyclical angel descending from heaven too… and joins in the smearing of Barnaby Joyce:

The method and madness of Barnaby Joyce won’t lie down because it strikes at the heart of Australia’s economic risks and opportunities amid the mother of all mining booms…

The opposition finance spokesman has tweaked his reckless claim that Australia could default on its sovereign debt…

His incoherence invites ridicule. “He does not have a clue what he is talking about,” Wayne Swan responded, mocking Joyce’s reference to “net debt gross, public and private”. The Nationals senator was saying “ridiculous, stupid and damaging” things about Australia’s debt position. Swan’s Treasury head Ken Henry has accused Joyce to his face of “a gross oversimplification of economic understanding”.

Doesn’t have a clue, ‘eh Wayne?  Remind us again how your Bachelor of Arts (thence career political hack) compares with Barnaby’s qualifications?

As for Ken Henry’s arrogant comments, perhaps Mr Stutchbury might care to do a little research. He might learn just how many international economists directly refute Henry’s confident visions of a multi-decade China Miracle.

Mr Stutchbury goes on to imply that Barnaby poses a threat to that Chinese angel descending, thanks to his warnings about Australia’s levels of debt:

So Joyce now begins with private debt, particularly Australia’s gross foreign debt of $1.2 trillion, or about 100 per cent of gross domestic product.

At $638bn or 47 per cent of GDP, Australia’s net foreign debt is one of the highest in the developed world and much higher than in 1986 when Paul Keating warned that Australia could become a banana republic.

You’d think that fact might concern Mr Stutchbury. Not at all. Immediately comes the justification:

Continue reading ‘Stutchbury Sees The Angel Too’

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