I read John Wilder, even the stuff I don’t understand or when he gets somewhat paranoid. Such as taking down the banking system. Then my son emails me and tells me to look at Canada, where people are talking about raiding money — or encouraging people to spend.
Bay Street economists estimate businesses and households are sitting on upwards of $170 billion in excess cash. It’s an eye-popping figure the Trudeau Liberals are taking notice of, with no less than five references in the Fall Economic Statement to “unleashing” that money.
“I do see the cash mountain, in both Canada and the U.S., as a serious source of potential upside to next year’s growth,” Doug Porter, chief economist at BMO Capital Markets, wrote in an email.
“I believe there is a strong case for a powerful comeback next year – if you open it, they will spend.”
While much of the focus of the fiscal update was on supports to get businesses and workers through the immediate challenges of COVID-19, the document did cast an eye to the recovery period with a pledge to commit up to 100 billion in stimulus over three years.
Of course, that additional stimulus, when it comes, would only add to Canada’s mounting debt pile – which is set to push past1.2 trillion as the country goes deep into deficit spending battling the pandemic.
So it’s easy to see why our savings accounts are creating such a stir.
There is a chance that there will be confiscation. Our Didact’s Iszreali friend comments about this: the best way forward is to not pay the game. A better way forward is to not owe money on what you own. I would recommend having your pills and food in advance. During the lockdown you could only pick up a month at a time of anything.
The best way to avoid confiscation of your property is… not to have it. I know it sounds puzzling, but if you have very little, it won’t be confiscated. Here I am supporting minimalism. I’m not saying you should not have stuff. I’m saying you should have as little as possible. Having minimal possessions means that you have very little that others can confiscate.
This one is very easy for me to recommend, as I practice it myself. I have very little in the way of material things. I’ve been called “cheap” by my family, ex-wife and other people. I take it as a compliment.
Another option is to geo-diversify. Honestly, this is where I fall down. This means that your assets, in any way or form (be it money, stocks, gold, real estate or whatever) are not only in one country. The rationale is that if your property is overseas, it cannot be confiscated that easily. I’m not the authority on it, but looking it up, asking around and getting good advice will probably go a long way. On that note, if you apply for a second citizenship (I started looking into it ~1.5 years ago), that can really help. The best advice I can give here is to consult as much as you can with multiple people and read a lot. Or ask Didact – he’s done a lot of research into this issue.
I’ll save you the prepper’s speech, but do note that one needs to be at least somewhat prepared for the coming disruptions and troubles. Roosh suggested one month of supplies, and I actually stock up on 6 months of medical supplies for myself. This is your call.
And our local government has just what people are warning about. They have taken land, legally acquired. They have reversed settlements set up as full and final. This undermines property rules, and makes any investment or improvements less likely.
“Buying Fletcher Building out of Ihumatao has formalised Jacinda Ardern’s worst decision as Prime Minister.
“It is the equivalent of the US President siding with Antifa over the businesses they vandalise.
“It’s now clear, if you own land and someone squats on it, the Prime Minister won’t defend your property rights, she’ll use taxpayers’ money to buy the land off you.
“In the case of Ihumatao, it’s apparently okay because future housing on the site will be ‘a sensitive development that recognises the special characteristics of the land.’
“Perversely, that precisely describes what Fletcher Building went through years of consultation and design with mandated iwi to try and deliver.
“It will be a miracle if this hotchpotch of an arrangement ever builds any houses, given this Government’s track record.
“The gravest issue is the terrible signal this sends agitators who decide to disregard private property rights and the legally binding treaty settlement process.
“Already we’re hearing and seeing rumblings of Ihumatao-like actions, such as the occupation of Shelly Bay in Wellington.
“Thanks to Jacinda Ardern there will be more – why wouldn’t there?”
David Seymour, ACT NZ
IF that is not the case, then there will be the inadvertent destruction of your employment by government policy. I’m quoting ACT again, because they are terse and accurate on these issues.
“Labour must stop seeing employers as the enemy and avoid doing further harm to the productive sector,” says ACT’s Small Business spokesperson Chris Baillie.
“The Government was told its latest minimum wage hike will have a ‘disproportionately large’ negative impact on the number of jobs created over the coming year.
“As a small business owner myself, I know how difficult it has been for SMEs to deal with the virus, the lockdown and a recession. Employers can’t afford one the highest minimum wages in the world, five extra days of sick leave, a new public holiday, and ‘fair pay’ agreements.
“No business I know of can increase its productivity by 6 percent year after year. As a result, annual increases to the minimum wage inevitably mean fewer hours being offered to staff or higher prices for consumers.
“Labour Minister Michael Wood was told to increase the minimum wage by a smaller margin and introduce it later, but he chose to ignore that advice.
“MBIE advised that hiking the minimum wage during a recession has ‘significant negative effects on the employment’ of the workers it is meant to help.
“The end result is that 9,000 more New Zealanders will end up on welfare at a time when we’re already forecast to lose 84,300 jobs over the next year.
Chris Baillie, ACT NZ
The context of the increased access to money is that we are building bubbles, and the ANZ is beginning to get worried.
Housing unaffordability is an enormous problem in New Zealand, with especially significant consequences for our young and most vulnerable – and trends continue to move in the wrong direction. Making meaningful progress is urgent, and change needs to be bold to reverse the tide. Broadly, we need to release land, build more houses and better align supply and demand settings. Even sustained stabilisation in house prices would require a monumental shift in the market, and would be a vast improvement from the rapid house price inflation we are seeing currently. But it’s not just policy that needs to change – we need to change our expectations too. Policymakers and the public both need to be willing to accept house price stabilisation or even gradual real house price declines. Not only would this help affordability, but a managed supply-induced decline in house prices is a much better outcome than a painful correction, which is a risk under the current market structure.