Blog description.

Accentuating the Liberal in Classical Liberal: Advocating Ascendency of the Individual & a Politick & Literature to Fight the Rise & Rise of the Tax Surveillance State. 'Illigitum non carborundum'.

Liberty and freedom are two proud words that have been executed from the political lexicon: they were frog marched and stood before a wall of blank minds, then forcibly blindfolded, and shot, with the whimpering staccato of ‘equality’ and ‘fairness’ resounding over and over. And not only did this atrocity go unreported by journalists in the mainstream media, they were in the firing squad.

The premise of this blog is simple: the Soviets thought they had equality, and welfare from cradle to grave, until the illusory free lunch of redistribution took its inevitable course, and cost them everything they had. First to go was their privacy, after that their freedom, then on being ground down to an equality of poverty only, for many of them their lives as they tried to escape a life behind the Iron Curtain. In the state-enforced common good, was found only slavery to the prison of each other's mind; instead of the caring state, they had imposed the surveillance state to keep them in line. So why are we accumulating a national debt to build the slave state again in the West? Where is the contrarian, uncomfortable literature to put the state experiment finally to rest?

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Monday, March 3, 2014

Question for the Film Classification Unit. And Bank Lending.


The usual apologies to Keri for appearing (below) on my blog; needless to say we don’t know each other, and my inclusion of her tweets in no way means she would agree with anything else in here, but two of the themes of this blog are protest against any type of censorship of free speech or expression, and that it is the right of parents to bring up their children, the state has no business in that.
 




 




 




 

How appropriate is it that members of a government body whose views may well be distorted by watching wholly too much porn, get to determine, over Keri, what her daughter should watch?
 

Further, with everything available on the Internet today, perhaps the film classification unit is way past its use by date anyway? Unless parents police this for their children, they’re going to see what they want, regardless.
 

Addendum: Unintended Consequences – Bank Lending:
 

Surprise. Now that banks lending to low deposit borrowers has been mandated at no more than 10% of a bank’s book, banks have found if they want to lend more to such borrowers, they only need to increase the size of total lending, so net indebtedness in New Zealand is going up. (Proof: ANZ’s latest result, as reported by RNZ this morning).
 
Of course, classical libs are not surprised.
 
We need to separate the state from economies, just as once the church was once wisely separated from the state.

 

 
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4 comments:

  1. Nic the NZerMarch 4, 2014 at 11:52 PM

    I certainly agree with the new use of factual analysis (observed since new year), its certainly worthy of a approval.

    Not quite so sure that the facts agree with your case here though.

    One would have assumed that ANZ's lending was all mutually agreed between them and their borrowers?

    Also household net indebtedness has been going up for quite a long time, well before the LVR restrictions were imposed. What makes you think the LVR restrictions are causing something which was happening without them?

    http://www.rbnz.govt.nz/statistics/key_graphs/household_debt/

    If you are concerned about net-indebtedness I think that the LVR policy is a good one promoting stability in the longer term, but its not a magic lever which immediately gives control over the level of indebtedness (in fact if it did we might call the policy autocratic).

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    1. Mark HubbardMarch 5, 2014 at 7:44 AM

      All I know Nic is the report I heard on RNZ which, going over the ANZ result specifically brought up the notion as I've written it. Growing their overall book was the only way the bank could still increase the low deposit borrowers, so a Central Bank policy brought in to 'control' the housing marking and household debt will be adding to the latter and probably doing little to manage the former. I've looked for the item on RNZ but its not a podcast (yet, at least).

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    2. Nic the NZerMarch 6, 2014 at 2:17 AM

      I would be interested to check this out and RNZ is usually fairly reasonable in its commentary.

      What I expect is that the conclusion (net higher indebtedness) does not follow from the premise (LVR restrictions, with banks needing to lend more to create more high LVR loans).

      In order to think about this logically you must look at this while hypothesizing the same borrowers who come through the front doors of ANZ in either case. If we assume ANZ thinks they are all a reasonable credit risk, and wants to lend to all of them, then having an LVR restriction which prevents lending to some of them (who want high LVR loans) then it must follow that the LVR restrictions reduce net indebtedness in the aggregate.

      Unless there is a mechanism where by the LVR restrictions change (and increase) the number or volume of low LVR loans coming through the door then this can't increase the aggregate indebtedness. To conclude that the incentive for ANZ to expand their book changes anything is to assume that they would not want to expand their book anyway (which they clearly would).

      Its also fairly clear that the LVR ratios are working against a housing market bubble and if anything this reduces the volume of borrowers walking into ANZ. This would be because with less credit expansion in the housing market the housing price inflation rate slows, which dis-incentivises further participation in the speculative game of flipping houses to each other in the hope that their price goes up (and lending to support this expands) between flips.

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    3. Mark HubbardMarch 6, 2014 at 8:21 AM

      I mostly listen to RNZ (or BBC) so if that item comes up as a podcast, I'll put a link up ... I suspect it would've been up by now though.

      Can't dispute your logic on this one. The salient point would be if banks want to lend more money to low depositers, then they have to increase overall lending (regardless of effects of that on indebtness).

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