A series of data points.
Christie is the pseudonym for an accountant. This is from a post about how the tax take is going down. GST is VAT — 15% tax on any good or service. You can claim back the GST you pay on goods and services for your business, but you must pay the GST on any goods or services you provide if your turnover is over 60 000 kiwi dollars a year. Accountants spend a fair amount of the year doing GST and quarterly tax estimates on the net profit for businesses.
So I am now going through the same process for the August/September 2021 GST period, and the provisional tax payments due in October. I thought it would be interesting to do a comparison between the two lockdowns. Please bear in mind that I have few Auckland-based clients, so all of the clients I am talking about are based outside of Auckland and the Waikato. Most are Wellington and Wairarapa based, with some in the South Island. We have just had the second period of lockdowns. We got through the first. We won’t get through the second.
The first thing that has struck me this time is the enormous amount of money businesses have received in government handouts. Don’t get me wrong; I have encouraged every business to apply for them if possible. We were in lockdowns Level 3 and 4 for 7 weeks last year. This year, apart from Auckland, we were in lockdowns Levels 4 and 3 for a total of 3 weeks. Furthermore, when you consider that the entire South Island should not have been in lockdown at all, the combination of the loss of earnings, the waste of perishable stock and the unnecessary government handouts, giving support to businesses that should not have needed it, forms a colossal waste of money. The unnecessary handouts were then added to lost tax revenue for the income that should have been generated during that 3-week period, but was lost.
The second thing is… without exception, everyone’s GST payments are down this time. Some are half what they would normally be. Sure, losing 3 weeks out of approximately 8 in a government-enforced lockdown should have a detrimental effect on cashflow, but it is much worse this time around. There has not been the immediate bounce-back that happened last year.
We are uncertain as to if I can work unless I take the mandated gene therapy. Which I won’t do, for good reasons. As a consequence, discretionary spending has been removed from the budget. Time to re read old books. Time to make the coffee at home. Time to order essentials from suppliers, not the supermarkets, who overcharge.
Point two: from Jim Kunstler. This suggests that the vaccine is being used as a distraction. My kid brother’s firm has to now charter ships to import essential parts — for making toilet paper. Keeping a good stock of consumables is now good sense individually. Having a local warehouse and not relying on ‘just in time’ is more sustainable than having a massive number of trucks delivering things as they finally arrive.
The hand in play for the moment is the spending legislation proposed by “Joe Biden.” It would generate a whole helluva lot more helicopter money from nowhere for nothing, and would theoretically keep the game going a little bit longer — except the process will only generate more unwanted entropy, causing decay in the value of that “money” and canceling the desired effect of spreading it around. That’s called inflation. If the value of money drops hard and fast, that is called hyperinflation. It would be politically and socially devastating, and probably lead to the downfall of the government. The net effect would be a nation bankrupt at all levels and that will segue into an epic economic depression.
If the legislation doesn’t get passed, the USA will perhaps skip the hyperinflationary intermezzo and move straight into a deflationary depression, which is what you get when nobody has any money. When that happens, especially in a system with money actually based on debt-creation, debts do not get paid (mortgages, car payments, credit cards, perhaps even coupons on US Treasury bonds), and when debts are not paid, money disappears. Poof! No money! It’s a vicious cycle. The more money disappears the more money keeps disappearing. None of this bodes well for the winter ahead.
Add to that the growing breakdown in global trade operations. Even many of those goods produced in other lands aren’t making it to the docks, and the reduced flow of goods that happened to already land on the docks can’t get unloaded and delivered to its various destinations because of disruptions in the US trucking sector. To some degree, those disruptions are caused by bonehead government regulations, especially in California, where most of the stuff from Asia lands. The bonehead regulations (like, outlawing trucks more than three years old) can be thought of as typical government “dis-services.”
Now add to that the rising cost of oil, natural gas, and coal — the global economy’s primary resources — and disruptions in the industries that produce these vital resources and you’ve got another layer of disorder being introduced into the system (entropy again). For the moment, government propaganda tries to divert your attention to a possible shortage of Christmas presents as the nation’s main concern. Don’t be fooled. It’s more about total systemic economic breakdown, as in US citizens having no heat and no food. Also, no gasoline and no parts for fixing broken cars (and trucks).
In Auckland, the lockdown is costing 100 million kiwi dollars (depreciating as I write) and the cost of petrol — they have extra taxes — is over three dollars. A litre. That is 12 dollars a gallon.
This means we don’t use the car unless we have to — because we are paying less in the south island, but it’s still well north of 2.5 dollars a litre.
There is already less money being spent. Casa Kea, despite the issues with my employment, is fortunate: we rinsed the mortgage and have minimal debt. Most people in my caste are living more freely, but are mortgaged. Fully mortgaged.
Which is why they have all lined up for the shot. They cannot afford to avoid it.
Point three: the banks are starting to limit loans (mortgages and any debt at all) to a multiple of your income. BNZ is the bank of New Zealand, ASB is the Auckland (not)savings bank: they are part of the ‘big four’ in NZ. (The others are ANZ and Westpac).
BNZ is introducing debt-to-income (DTI) restrictions across its mortgage lending ahead of being made to do so by the Reserve Bank (RBNZ).
Investors and owner-occupiers won’t be able to get mortgages worth more than six times their gross annual income.
A BNZ spokesperson told interest.co.nz the change will initially apply to borrowers seeking a BNZ mortgage via a broker.
The new policy will take effect from the end of today (Thursday), and will be monitored and reviewed.
Meanwhile, ASB confirmed it’s already using DTI multiples when assessing mortgage applications.
It didn’t disclose the ratio[s] it’s applying or say how long it’s been doing so for.
An ASB spokesperson said, “In certain lending situations, particularly in the current low interest environment, we think it is prudent to consider DTI multiples, and we actively use these today.”
A BNZ spokesperson likewise explained the bank is looking at the overall level of debt its customers take on “to ensure they are in a more secure position with rising interest rates”.
They said BNZ regarded “increased regulatory focus on DTI ratios as a way to deliver a more sustainable housing market”.
I got a phone call today. From someone who does not know how the mandate will go down. I do: it will be personally nasty and worse for our system. The number of people who are going to walk has been underestimated. I was offered another job to do. Because I am reasonably good at that pinch hitting type of thing.
I said: (a) need to get rid of the vaxx mandates and (b) locum rates. Or else. Aaron Clarey has a long post on how the functional universal basic income (UBI) is going to allow people to… ghost. For a little bit. He misses the point that then there will be no economy and then no UBI. But he is correct on this: punishing the productive means they will walk.
Whether employers realize it or not, and whether socialists/democrats realize it or not, they are completely dependent upon the real and productive members of society. The MBA-laden cunt in the HR department does not do ANYTHING. She does not manufacture tires, deliver gas, or even clean the windows. She is bureaucratic, overhead, worthless fat. The same can be said for the millions of professors, teachers, non-profits, and other nanny-nazi busy bodies lecturing the rest of society how to live and how they own them more tax money. That’s nice Tanner the Sociology Professor thinks Steve the mechanic should work more and pay more in taxes. If Steve quits fixing cars, society is fucked. Tanner could literally kill himself and society wouldn’t skip a beat. And as I said before, there has never been a time where more productive members of society are calling it quits. If you want to go Galt and make it count, NOW is the time, especially while there’s a democrat president in office.
And so in understanding this economic/political/sociological perfect storm that has arrived, every productive member of society should have a list of demands from any potential employer, today and into the future. A modern day “worker bill of rights” that will drastically improve working conditions, drastically increase production, but make sure you are never insulted, abused, or enslaved like you’ve been the past 20 years.
1. The elimination of college education when not necessary, and a reintroduction of training programs.
2. The elimination of all political training and a return to meritocracy (as much as that was accomplished anyway beforehand)
3. The elimination of commutes unless absolutely necessary.
4. The inability to fire anyone based on their personal lives whether that is medical choices, gender, politics, sexual relations, social media, etc.
5. The work gets done, I can go home. I do not sit and look busy at my desk because I’m better and faster than everyone else.
It’s not a terribly extensive bill of rights, nor is it one that any employer is going to sign in a contractual sense. But it is a group of standards every productive member of society must hold employers up to before exchanging their labor. And if every producer in this society just decides to take a vacation, and deprive employers and society of our skills, competency, reliability, and production, it will become very clear who is most important in this society and who, precisely, will be dictating the terms going forth.
I know I cannot not work. My Dad finally retired at 85 after his second stroke. I will do something. I’m able to contribute considerably. But the regulators need to disappear. We shall do good. We shall build the kingdom of God.
Within this society, or in Galt’s gulch.