These are the days and surviving a recession

Within days of a black president being elected as president of America, and a life of protesting against racism, Miriam Makeba has passed away. I pinch myself to check that I’m really living with these experiences and am so grateful to be alive in this era of exciting times, great times and troubled times. I hope that Obama goes on and becomes one of the great presidents, which is a big ask, but it is very necessary.

Meanwhile downunder, Helen Clark has resigned her leadership of the Labour Party having lost the New Zealand election to probably one of the youngest Prime Ministers in our history. To me amongst other things, she represents the Politically Correct which is ironic, because I know she lost many staunch Labour voters in her campaign by trying to make the National Party and John Key in particular look untrustworthy. The TV advertisements at the end of their campaign were all trying to smear John Key instead of focussing on their successes and their future plans, and in my humble opinion, it backfired badly. When you throw mud, some of it stays on your hands and she should have known better. Several people told me that they decided against voting for labour because they didn’t like smear campaigns.

Now we are heading into the biggest recession / depression in living memory. The 30’s and the 80’s will pale in comparison. The depression is a bad thing, but there are different ways of thinking about it and smart people will do well, or at least survive.

Something that has amazed me for some time is how business has teased people, who should know better, to spend money they don’t have on things they don’t need and keep doing it over and over. Retailers and finance companies ought to take some responsibility for what they have done, but many will because their business will dry up. The finance companies will go broke because they loaned money to people that they couldn’t secure and most of the goods had dropped way below their value, the minute they left the showroom.

Banks forgot about their commitment after the 1987 crash. For a while they started looking at people’s ability to pay their mortgages and required that they have at least 20% deposit. Then as property values increased they suddenly decided to finance people with 100% of the loan, figuring that the property values would keep going up and it wouldn’t make any difference. Of course while the mortgages were being paid they were making a tidy profit.

The retailers (including car companies) figured they weren’t taking any risks because it was the finance companies that were lending the money, not them.

Funny really because we often say that instead of employing politicians, who have a short term focus and often little experience in running a business, we should pay a premium and get successful business people to run the biggest business of all, our country. The rational was that in business anyone that went to the board and said, “Whoops I miscalculated and we have half a billion dollars less than we thought”, would be quickly helped into a new career, but it seems business has been doing the same thing and thinking that they can get away with it.

By saturating the market with things they can’t afford (and this hasn’t stopped) with 18 months deferred payment and interest free for another year or so, all they are doing is compounding the crisis. Who wouldn’t be teased into buying a new 42″ LCD widescreen HDTV with freeview built in, especially when the Jones’ have one next door and you don’t have to pay anything for over a year.

So we aren’t just heading into an economic crisis, we are adding fuel to the fire to make the mess even worse and if our government’s are broke, we are walking straight into the arms of the waiting Chinese Government who would be delighted to buy our failing banks and finance companies.

Has everyone taken leave of their senses? Have you taken advantage of a 100% mortgage? Have you bought products on special deals that you wanted but didn’t need? Come on, be honest.

There is potentially an exciting side to this as well. If you were smart and saved money, or invested in assets or property that you could afford and that made sound business sense, you could be looking forward to exciting times. Many of today’s wealthy families made their fortunes in the great depression of the 1930’s. If you were prudent during the boom, you could find yourself on top when the crunch comes, ready to buy into a business or buy some real estate at rock bottom prices and benefit from this situation. Even now it isn’t too late. What are you going to do now?

Christmas is coming. Don’t take that overseas vacation, pay half of the money into your mortgage and have a local holiday. The domestic tourism industry is hurting and you should be able to have a great time enjoying your own back yard. Reduce your debt as quickly as possible and only have debt in things that will increase in value when things come right. I think it’s called delayed gratification.

While this blog is starting to get a good following, I would love to get more readers and encouraging me to keep writing. If you feel that my blog is interesting I would be very grateful if you would vote for me in the category of best blog at the NetGuide Web Awards. Note that the form starts each site with www whereas my blog doesn’t and is of course https://luigicappel.wordpress.com.

Thanks so much for your support:)

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Election Promises

It’s full on election time, we have had the first debate. One thing that I thought was very cool was that TVNZ ran the debate in conjunction with YouTube. People were invited to record their questions for the leaders of the Labour and National parties on YouTube. The questions and responses, such as this one on Law and Order are also available to view on YouTube which means everyone has easy access to the parts of the

debate they are interested in. Great use of new technology and kudos to TV One.

And the NZ Herald has regular features talking about the different offerings on a topic, from each party. Today’s topics are law and order. I was telling my wife about the Act policy which I like.

Key things I like are that you serve the sentence you are given and 3 strikes and your out. I think this policy is based on the system that made many of the streets in New York safe. The first time I went to New York and wanted to go to the Cotton Club, I was told that taxi’s would take me there before dark, but they wouldn’t come back to pick me up because it was too dangerous in Harlem and taxi drivers were being murdered. In recent years the Zero Tolerence policy has made the area much safer.

They also said that if you are sentenced to 5 years in jail, you should serve 5 years. This is something that we have been asking for for years. The problem is that parties make all these statements, but they have very little credibility because they never seem to follow through. I am thinking that one possibility is using our political system to vote for a party like Act on the party vote to give them the legs to push through one of these policies.

Law and order is an election issue and in my humble opinion Helen Clark and the Labour Party want everybody’s vote and are saying they are against gangs and organized crime, but sympathizing with the reasons people join them. The National Party doesn’t seem to be much better. John Key is saying that he wants to lock up recidivist criminals and will build a new prison to house them. In my humble opinion young gang members who go to jail will add to their ‘mana’ (in simple terms Maori for honor or power) within the gang and will be heroes when they come out. They will be looked after ‘inside’ by their gang family and life won’t be too bad at all.

My wife said, “It’s all very well them saying these things when they want to vote for you, but after the election all the promises go out the window”, well actually she said something more colorful, but she’s pretty much on the mark. How many times have we been conned by politicians, voting for them on the basis of their election promises and then when they get in they have loads of great reasons why they couldn’t go through with it, usually blaming the outgoing parliament.

The addage is that it doesn’t matter who you vote for, a politician will always get in. It’s funny really that at election time we elect people that mostly we don’t trust to keep their promises and give them a mandate to run the biggest organisation, our whole country!

More on Mugabe

I sit here in the comfort of my living room with a coffee and having read the newspaper and being grateful for the good fortune to have been born in a peaceful country and to be living comfortably in another. I read the morning paper online to the news that Mugabe receives welcomes and hugs at an African Summit after the sham of the latest election.

I have met several people from Zimbabwe who have come to New Zealand having lost pretty much everything, who constantly live in fear for friends and family that didn’t have the wherewithall to leave or refused to leave their homes that they spent their lives building. It is impossible to imagine what it is like in Zim right now. Mugabe has engineered another election and is of course the victor. South Africa which fought for the rights of coloured and black people seems to be torn with the fact that Mugabe kicked out white people and that he is now having people beaten, tortured and killed for trying to use their free will.

President Bush and others including our Prime Minister Helen Clark are calling for sanctions. The problem is that weapons supplied to Mugabe’s regime come from China and other countries such as South Africa and they are unlikely to cease this lucratuive trade, although how he manages to pay for them in a country that is essentially bankrupt, beats me. The people of Zimbabwe are worried that they will now be tomorrow’s news and will be forgotten. China has also refused to deny Zimbabwe’s attendance at the Olympic Games, which is understandable having been the subject of boycotts and ‘political intereference’ themselves in the past and they don’t have a great track record when it comes to human rights.

Many people painted their fingers red or deliberately invalidated their votes to avoid voting for Mugabe. There are stories that the Zanu PF were out in force with a project they called ‘Show Me Your Thumb‘ and beating those who hadn’t voted. There are now rumours that voting lists have been obtained by the Zanu PF thugs which will be used to punish those who did not vote for Mugabe.

So what happens next? In my humble opinion, the result of boycotts and sanctions will simply make the situation in ZImbabwe more desperate. More people will die and the country will be washed in rivers of blood followed by disease and starvation while Mugabe languishes in his oppulence. There won’t be much to save before long.

I’ve asked the question before, why do people rush into Iraq to ‘save the people’ and not into Zimbabwe. I know the answer is oil. Come on world, lets not sit back and watch this continue. I challenge the people of the United States, the most powerful country in the world. You, who managed to leave your countries for a better world, who said, “we must not forget” after World War ll. New Zealand, as always will play our part, but we don’t have the might to do more than condemn and send in a few supporting Peace Keepers. We are after all a country smaller than many of your cities. We played our part to bring down Apartheid but this needs worldwide support. This sort of despot should not continue to play his games with the lives of human beings.

Final question. How does he manage to travel the world with impunity? Why is it that an ‘accident’ doesn’t happen to him? Is there a reason that his presence is tolerated? Am I missing something?