Argie pinko cops one in the chook

The time is fast drawing near for the Argie pinko who has been freely spending other peoples money to have to pay it all back:

ARGENTINA has finally run out of wiggle room in a billion-dollar showdown over foreign debts unpaid since the country’s world-record default a decade ago.

The stakes couldn’t be higher for President Cristina Fernandez after a US federal judge in New York late on Wednesday ordered her country to pay immediately and in full everything it owes.

Fernandez has referred to the liabilities as “vulture funds” and blamed them for much of Argentina’s troubles.

The total owed is $US1.3 billion ($A1.26 billion) and has to be paid by December 15.

The judge has also barred Argentina from paying other bondholders until it satisfies the judgment, putting the president’s back against the wall.

If she doesn’t reverse her longstanding position and pay up, she risks triggering another historic Argentine debt default, this time totaling more than $US20 billion.

“It is hardly an injustice to have legal rulings which, at long last, mean that Argentina must pay the debts which it owes. After ten years of litigation this is a just result,” US District Judge Thomas Griesa concluded.

Cowboy Liquidators

Georgina Bond has an article at NBR about dodgy liquidators. I can tell you that from a recent investigation that the activities of numerous liquidators have come to my attention. I agree with Georgina that something needs to be done to rein in the predations of these rapacious liquidators.

The theft conviction of Nelson liquidator Pat Norris demonstrates why the laws regulating insolvency practitioners need reform, lawyers suggest.

Patrick Dean Norris, 55, is perhaps best remembered for the lurid headlines of two years ago when he made intimate recordings of his ex-wife and put Pink Batts in her underwear drawer.

Last week, the former Kawerau mayoral candidate was found guilty of theft by a person in a special relationship after a two-week, judge-alone trial at Nelson District Court.

Norris will be sentenced later this month.

The conviction relates to allegations he banked $80,900 from the liquidation of Auckland-based Astra Enterprises into the trading account of his company Norris Management Services and used the money for personal and business expenses.

The Crown said there was no evidence any creditors of Astra Enterprises had been paid.

Judge Michael Behrens QC found Norris ?engaged in a blatantly dishonest course of action? ??instructing his staff to create invoices for an amount to cover at least $80,000 after the Companies Office visited to inspect the Astra file.

Norris, who represented himself at the trial, has indicated he is likely to appeal the decision.

One lawyer I spoke to recently told me of one liquidator whose modus operandi is basically stand over where they confront directors, lawyers,?accountants? essentially who ever they identify as a potential target and demand cash/assets/recompense for turning a blind eye, and failure to do so will result in them visiting the Police to lay a complaint.

?[I]t is Bell Gully?s view a person convicted of a dishonesty offence should not be permitted to act again as a liquidator of a company.

?This is particularly so where the dishonesty occurred in the course of a liquidation, such as here, where Norris stole funds from the company and its creditors,? Mr Tingey says.

The Insolvency Practitioners Bill, before Parliament, would redress this by disqualifying any person convicted of a crime involving dishonesty from being a registered insolvency practitioner, unless the court orders otherwise.

Yet there will still be deficiencies, Mr Tingey says.

?The bill only introduces a negative licensing regime, excluding people from acting as a liquidator if they are disqualified in some way. It does not introduce a positive licensing regime, requiring minimum qualifications for an individual to act as a liquidator.

?As a result, it would not appear to prohibit someone such as Mr Churchill from acting as a liquidator. Indeed, it would appear to allow Mr Churchill to register and hold himself out as a registered insolvency practitioner,? Mr Tingey says.

?The label ?registered insolvency practitioner? implies that the practitioner meets a minimum standard of proficiency, when he or she may not be qualified at all.?

The Norris case illustrates why the bill should contain a positive licensing regime, with minimum standards for individuals to be able to hold themselves out as registered insolvency practitioners, he says.

It is real wild west stuff out there. As I said I have come across numerous examples since picking the scab off the industry. There is a real rapaciousness out there and I have seen evidence where company directors with relatively small cashflow issues have been picked clean after seeking restructuring and insolvency advices from the cowboy operators.

Forgive Student Loans?

Winston Peters is proposing to forgive student loans. The Greens also propose to write off student debt.

Andrew Sullivan blogs a simple video why this is a stupid idea. It is an American video, but everything holds true for NZ:

Will Labour criticize Len Brown for his negative creditwatch?

Len Brown, he who can’t be trusted with a credit card without “hamming it up”, has now run the Auckland Council into murky waters with his financial management of the city.

With a inner city rail loop he can’t fund without massive rates hikes or monstrous debt, he has now affected the overall creditworthiness of Auckland Council, meaning it could become more expensive to build roads, community halls, parks and more thanks to his loopy rail ideas. (Worsening credit ratings mean it’s more expensive to borrow money)

When central government suffered a credit downgrade, Phil Goff and David Cunliffe were all over the media criticising the government for a financial situation partly inherited from Labour and party inflicted by a global credit crunch.

They even criticised John Key for being unavailable for just over an hour on a radio show, yet Len Brown is absent looking at Chinses tunneling technology to spend ratepayers money on. He’s been gone far longer than John Key was on this issue.

Now that Labour’s loopy rail Mayor is plunging Auckland into a debt crisis of his own volition – it will be very interesting to see what Labour say.

My guess – probably nothing.

Uh-oh Lenny’s loose spending has grabbed attention

Standard and Poor’s are none too pleased with Len Brown’s free spending ways:

Ratings On Auckland Council Placed On Creditwatch Negative, On Increasing Debt Levels

Press Release by Standard and Poors MMS ?at 3:06 pm, 14 Nov 2011

Standard & Poor’s Ratings Services said today that it had placed its ‘AA’ longterm issuer credit rating on New Zealand’s Auckland City Council on CreditWatch with negative implications.

“The rating action follows our discussions with Auckland Council which highlighted their plans to significantly increase capital expenditure, particularly in the area of transport,” said Standard & Poor’s credit analyst Anna Hughes. “At this stage, it is unclear as to how much of this capital expenditure will be funded using debt; however, current revenue and capital-expenditure projections suggest that the council’s debt levels will exceed 170% of operating revenues by fiscal 2013 and reach 200% by fiscal 2015.”

“We expect to resolve the CreditWatch during the next 90 days as the council finalizes its draft 2012 Long Term Plan. Any rating action would not likely exceed one notch.”


Of course Len Brown is in China at the moment looking at Chinese tunnel building machinery…he may as well come home now.

Too big to bail

Italy is too big to bail:

Italy?s government debt is massive, at around ?1.9 trillion, or 120pc of its gross domestic product (GDP). By the end of the year, it will be 2.7 times the size of the debt of Greece, Ireland and Portugal ? the current bailout recipients ? put together, according to Gary Jenkins, an analyst at Evolution Securities. He estimates that rescuing Italy would cost around ?1.4 trillion.

The problem is that the eurozone?s rescue fund has firepower of just ?440bn and much of that has already been committed. Politicians have pledged to boost it to ?1 trillion, but efforts to do so are not going smoothly.

Why Labour’s Asset Sales analogy is crap

Deborah Coddington wrote a blinder in today’s Herald on Sunday. She called out Labour and then explains why their analogy on asset sales is rubbish.

The thing is, New Zealand is a different country today. Our debt situation is still not pretty – private debt sits at $213 billion, public debt $40 billion – but we’re not teetering on bankruptcy.

But frugality is called for. So when the bank says you’re stretched, and you own a house, an apartment and a bach, what to do? You don’t want to sell because the apartment and bach are rented and bring in a moderate income. But you need more money to do them up, so the rentals could be higher.

So you do what National’s intending. You hold on to a majority shareholding of the properties.

Then you tell your family they can buy shares in the remaining 49 per cent of the house, bach and apartment. With their investment money, you improve the properties, increase the rentals and the dividends go skywards.

What about that whining nephew who says he already owns the beach house because granddad built it in 1921 and the whole family contributed labour to improvements over the years? Remind him about the free holidays he’s had, and the rent, power, rates and maintenance for which he’s only paid a fraction. Inheritance isn’t a given.

Labour living in la-la land

Labour’s funny money figures aren’t stacking up and the public knows.

It simply isn’t?believable?that you can reduce revenue, increase spending and then claim that you will pay back debt sooner.

Anyone knows you can’t borrow money and put it in a savings plan and then pretend you never borrowed that money in the first place…well anyone but Labour.

Quote of the Day

The world breathed a sigh of relief after the US “solved” their debt ceiling problem.

Rand Paul thinks otherwise:

The federal government borrowed over $230 billion dollars. In one day. The day after the debt ceiling was raised. By the end of the week $300 billion of the first $900 billion of the debt ceiling increase will be completely gone. Ronald Reagan was right: The government is like a baby – all appetite at one end, no responsibility at the other.


Labour = More debt + more tax + borrow and hope

After saying their tax changes would fill the hole from their reckless?promises – Labour has now confirmed they plan to borrow more – tax more and pray.

Labour has admitted it would borrow more than National in the short term to help fund new policies but is confident its plans, including a capital gains tax, would cut debt over the long term.

Labour are stuck stealing underpants.

Leader Phil Goff this week said Labour’s tax policy would provide a long-term solution to New Zealand’s debt problem. Yesterday, however, party sources acknowledged the plan would see a Labour government borrow more in the short term.

They said that was necessary because it would not generate revenue from the sale of shares in state-owned assets as National planned to do.

Out of time, out of ideas and out of power. Labour should now change strategies to one of STFU and creating as small a target as possible.That way they can attempt to limit the damage this election.