In 2011 Lee Farkas went to jail for financial fraud – John Key - his fellow Wall Street banker - became the Prime Minister of New Zealand – Was that fair?

Lee Farkas story first – followed by that of John Key.

It has become widely recognised that much of the cause of the 2008 Global Financial Crisis was financial institutions - in the pursuit of short-term profit - issuing more products based upon contracts of credit than there ever existed the natural resource collateral to ever clear.

First Major Criminal Conviction Related to the Mortgage Meltdown

http://fraudbytes.blogspot.co.nz/2011/04/first-major-criminal-conviction-related.html

SATURDAY, APRIL 23, 2011

The Justice Department is celebrating this week after finally landing a major criminal conviction in the aftermath of the mortgage meltdown. The Justice Department was able to stick 14 counts of fraud and conspiracy on Lee Farkas in what is reported to be a $2.9 billion mortgage fraud scheme. Mr. Farkas operated a huge mortgage business, known as Taylor, Bean and Whitaker.
Taylor Bean apparently sold billions of dollars of mortgages to Fannie Mae and Freddie Mac and obtained loans from large U.S. and foreign banks that were collateralized with fictitious mortgages or mortgages already sold to others.
As is common with many fraudsters, Mr. Farkas had an appetite for material possessions that led him to spend at least $20 million of other peoples' money on things like fancy homes, classic cars and even a private jet (see the photo to the right). Accordingto the NY Times,

"The scheme began in 2002, prosecutors say, when Taylor, Bean & Whitaker executives moved to hide the firm’s losses, secretly overdrawing its Colonial Bank accounts, at times by more than $100 million. To cover up the actions, prosecutors said that the lender sold Colonial about $1.5 billion in “worthless” and “fake” mortgages, some of which had already been bought by other institutional investors. The government, in turn, guaranteed those fraudulent home loans."

 In anotherNY Times article, it was reported that:

The fraud would last for seven more years, ending in 2009 because Taylor Bean’s principal bank, Colonial Bank of Montgomery, Ala., was itself in danger of failing. Mr. Farkas came up with a scheme to appear to recapitalize the bank, and thus get federal bailout money, but it did not work.  

Much of what Farkas was convicted for was creating fictitious mortgage loans and use the fictitious loans as collateral for obtaining financing from major banks including two large European banks, Deutsche Bank and BNP Paribas. For example, these two banks "thought their $1.68 billion in loans was fully secured by collateral. But only a tenth of that collateral was real." Apparently, the jury found that the scheme to create fictitious loans was ultimately Farkas's doing.

Interestingly, Farkas gave the jury a pretty clear cut case in that he essentially said that he thought he had the right to commit fraud.Accordingto the NY Times, Farkas said the following:

Patrick F. Stokes, a deputy chief of the Justice Department’s criminal fraud section, asked Mr. Farkas if he thought Taylor Bean’s agreement with Colonial Bank allowed the mortgage firm “to sell fraudulent, counterfeit, fictitious loans” to the bank.

“Yeah, I believe it does,” he replied.

“It’s very common in our business to, to sell — because it’s all data, there’s really nothing but data — to sell loans that don’t exist,” he explained. “It happens all the time.”

Seriously?! I don't know how to respond to a statement like that. Maybe I will try for the "understatement-of-the-year award" and say Mr. Farkas has a problem with his ethical compass?!

It sounds like he'll probably have the rest of his life behind bars to try to get it worked out...

John Key - The Unauthorised Biography

Weekend Herald Sat July 19 2008

Into the big time
It was 1995. Again Key blasted through the ranks. His confidence was legendary. London-based senior executive Steve Bellotti visited, and when he asked what the new recruit thought of the company's FX performance, he was direct. "It sucks!"
Bellotti, a fast-talking Australian from Gympie, near Noosa, said: "If you're so clever I'll send you up to head office in London, and if you don't make it in 12 months, I'll sack you."
Key shot back: "If I don't make it in 11 months, I'll quit."Bellotti made him global head of foreign exchange and he revolutionised the "blue blood" investment banking sector. "There was this massive opportunity to cross-sell the firm," says Key.
"We'd go to these fund managers and we'd talk to them about equities, but we wouldn't necessarily leverage foreign exchange - and when we did, they'd say our capability wasn't that good.
"So I wandered up to London and said, 'we're going to go interbank FX - make prices to the other banks'. Morgan Stanley, Goldman Sachs and Merrill Lynch, the blue-blood investment banks, didn't do that," he explains. "We actually took on the big banks, Citibank, Chase, then we went and hired their staff and went to their clients and told them 'look, we've got all those same capabilities as Citibank in FX and options. Plus we had this beautiful thing going because we were the first to supply margin trading to big hedge funds. We had the capability to cross-sell them several products using one bit of margin."
Remembers Bellotti: "I brought him to London and he shot the lights out there too. Within three to four years Merrill Lynch, London, was regarded as one of the premier businesses."Key explains: "I had a whole lot of people working for me who were at the cutting edge of delivering quite complex and new and innovative products. They tended to either be a new product or into a new market, usually the emerging markets, Russia, Brazil, Argentina. I wasn't the guy sitting there dreaming it all up, but I was the guy who was responsible for those people." Did he foresee the problems which resulted in the sub-prime crisis? "Was it hard to predict? Not really."
The products which underpinned the sub-prime boom - then bust - were hatched in 2004-2005, long after Key had left Merrill. Indeed, he says when he went back to London in 2007 he was "horrified" at the level of risk Merrill was running. "It was enormous and I just didn't think that enough had changed to warrant that level of risk."
Back in the late 1990s Key was in his element, working at the centre of the universe for FX. He presided over around 140 dealers trading billions of dollars a day. The Asian markets came in in the morning and New York in the afternoon. "Within two years we went from being 43 in euromoney to number three," Key says.
"He never mucked up," says Bellotti. "Although they lost money, as you do, he never panicked, never stressed out, just did his job."Geoff Massam, a New Zealander then running the IT part of Merrill Lynch's FX business, now with Deutsche Bank in Connecticut, remembers how Key would be on the phone to the Governor of the Reserve Bank, Don Brash: "Though he wouldn't do it in a name-dropping way - he was talking to people like that all the time."
Massam believes Key's knowledge of the global economy would give him a "huge advantage" in running the country.
Although a "great client person" responsible for serving the people who ran the world's biggest pension funds, Key, who worked 12-14 hour days, did not subscribe to the lap-dancing, carousing, money trader stereotype. "We didn't do that, condone that," says Bellotti. "It was all just good clean fun. Sure we'd go out drinking with clients, go on trips with them, skiing to Verbier and St Moritz - but apart from that it wasn't our thing."................Bellotti, like many other middle-aged former traders, now travels the world investing his money - in his case in luxury resort complexes. He considers Key a world-beater."His career's a good lesson in life when it comes to risk management. Most people don't know what risk versus reward - or return - is about. John does. One weighs up the odds, balances the situation, measures the people, balances the evidence. John Key totally understands his environment and the outcomes. He transcends the market, geography and people. This guy is going to put New Zealand on the world stage."Bellotti remembers back to one winter's day, standing in the rain outside the office in the 3pm gloom of Ropemaker St, near Liverpool Street Station, and talking to Key: "There must be more to life than this?"
By 2001 Key was homesick. It was time for the next step of the plan: He flew to New York to see their ultimate boss, G. Kelly Martin, and resigned. "Clearly John you're having a mid-life crisis, let's talk this through for God's sakes," said Martin, who has extricated himself from a business dinner in San Francisco to talk about his former employee. "John faced off some of the biggest clients in the world, including governments," he says. "He worked with the Government of Singapore, the Central Bank of China, some of the big Middle Eastern pension funds, Shell and US Fidelity and Capital. He had a very good handle on a variety of financial products: one of the most senior client people we had."
But Key was adamant. "No, I want to go. That's what I want to do."
"Was I upset to lose him? Oh no," says Martin. "Talented people want to do interesting things and it's kind of hard to hold them back."
But why send him to manage debt markets in Australia? Was he fired?
"No, no, no," says Martin. "He was specifically asked by me to go down to Sydney and give Merrill Lynch another year and a half and help me find out what the strategy in Australia should be. He came up with some very good insights, helped us focus on certain areas, the right clients, and set up in a way that made a lot of sense."
"We joke with each other, we don't know what training we got at Merrill Lynch but we seem able to adapt to make an impact in other areas. But I think if you bring the basics: risk/reward; investment/return you can take those skills to other activities."
That same group at Merrill Lynch are now scattered over the world. One is an assistant secretary of defence in Asia, 25 are CEOs of different industries. Martin himself, now 49, is CEO and president of Dublin-based Elan, the largest biotech company in Europe developing drugs to fight multiple sclerosis and Alzheimers.
"And then there's John who's a very special and unique guy," says Martin."A lot of people have plans but very few execute them. John did."

Key chases luck o' the Irish

Wednesday Jul 20, 2005
By Fran O'Sullivan National MP John Key gets a gleam in his eye when he starts talking about New Zealand becoming the "Jersey of the South Pacific". "Why not have an offshore banking industry based here?" he asks.
"In the right conditions you could attract 200 banks to register here - each with a CEO and staff. You could attract insurance companies. Bring back lots of Kiwi accountants and lawyers. Single out clusters - such as high-class yachts - or other special sectors as the Irish did."
Key is clearly on a roll as he lists the options New Zealand could explore if it decided to abandon outdated ideology and take a more pragmatic approach to growing the economy.
The former investment banker knows what he is talking about.
As head of global foreign exchange for investment giant Merrill Lynch he shifted a considerable amount of his business to Ireland in the mid-1990s to take advantage of a 10 per cent tax rate for foreign investors.
The investment was a runaway success.
"We transferred across the aircraft leasing business, the complex interest rates derivatives business, the entire back office for global foreign exchange and a huge chunk of private clients' business," says Key.
By the time he left Europe to head home and stand for the 2001 election as a National candidate, Merrill Lynch had more than 400 staff in Dublin. It now has 700.
It was also paying the equivalent of about $250 million a year to the Irish exchequer for tax and indirectly propping up a swag of top-class Dublin restaurants and bars as its young money-men lived the life of Reilly.
The Merrill Lynch story was writ large across the economy by a raft of other big-name financial investors, and US computer and pharmaceutical firms, which ploughed investment into Ireland.
The example of how the Irish transformed their economy into one of Europe's pre-eminent investment destinations and lifted per capita GDP has stayed in Key's mind.
But as a former money-man, he is also interested in how Jersey built its economy on the back of offshore trusts.
And how Taiwan poured money into its existing industries through increased research and development, singling out particular sectors, such as nanotechnology or cellphone technology, to differentiate its economy.
Key believes too much of New Zealand's foreign investment has been based on investment in existing businesses - not on completely new ventures.
"From New Zealand's perspective there is the opportunity, if we wish to consider it, of saying how can we explore and grow new industries."

If National wins the election Key will be Minister of Finance. Already he is planning a feasibility study to see if some of Ireland's measures can be adopted here to fuel an economic transformation.
"Why not look at the success lessons from other small island economies?" he asks.
The Irish model is perhaps more easily understood here than the Jersey model, with its whiff of tax-haven activities. In post-Winebox days, this might get up the nose of New Zealand First Leader Winston Peters - a potential National coalition partner. Clearly Key's proposals are well ahead the ideas of many in his party who are still locked into the 1980s ideology of neutral tax regimes.
Or even those of his own leader, Don Brash, who retains a decidedly Presbyterian approach to meddling with the economic levers. His is basically an agnostic approach when it comes to playing with the country's balance sheet to obtain particular outcomes.
Key's point is that all options should at least be explored.
He claims the current Government is acting as an obstacle to business and needs to be more user-friendly.
Again drawing on the Irish model, he tells how the Industrial Development Agency "guys" used to attend Merrill board meetings and talk through issues affecting the business. The agency would come up with ideas and adjust rules to help the company - "as long as it was not intended to thwart the opposition".
"It was the complete opposite to the way we operate in New Zealand at moment," he says.
"The government sector was much more interactive, much more user-friendly, much more industry-based and less focused on grants."
He dismisses claims that Ireland's success was based on the republic's ready access to European structural subsidies ("they occurred well before Ireland took off").
The corporate tax rate and the huge investment in educational achievement were major factors, he says.
On top of that, Ireland's investment in a national broadband service to aid technical investment was a standout factor.
"If you get the framework of the economy right the market will sort it out."
Key will soon get a chance to test his ideas as the election gets past the phony stage. National will release its tax cuts package early on in the campaign. Debate will inevitably focus on the size and affordability of the package. But the initial tax cuts will not be radical.
Key has no plans to increase GST to 15 per cent (although he can quickly parrot off the numbers) to offset major personal tax cuts as Labour did in the 1980s. That would also involve adjusting benefit rates to offset the increased cost of consumption.
But it is apparent that Key believes there is plenty of room for a series of cuts, given the size of the Labour Government's spending pledges over the next three years.
Prime Minister Helen Clark and Finance Minister Michael Cullen will soon put their record in front of voters and campaign for a third term in Government based on their experienced handling of the economy.
"Clark and Cullen" - as the Prime Minister often says - have presided over a golden growth period.
But opinion polls indicate voter disenchantment with Labour's old firm. Debate is bound to get nasty as Cullen, in particular, tries to portray Key as an inexperienced politician who is prepared to buy off voters with tax cuts that a contracting economy cannot afford.
In political terms both Key and Brash are relative novices. They have been in Parliament for a mere term, compared with the Labour firm's eight terms.
But voters should be able to look past their relative political inexperience to their huge "real-world" experiences, as Merrill Lynch operative and a former New Zealand Reserve Bank governor.
In Key's case he can also point to the invitation he received in 1999 to join the Foreign Exchange Committee of the Federal Reserve Bank of New York as further evidence of his economic management credentials.
Game on.

John Key Says He Should Be Held To Account For His Part Of The Global Credit Crisis!

Afternoon of 5 Nov 2008
Willy Jackson and John Tamahere interveiwed John Key. Here is an answer given by John Key re what caused the credit crisis. It should be remembered that at about this time in the election campaign he was batting away questions from Labour in regard to his career at Merril Lynch 7 years ago as being that long ago there is no way he could be tied to having any contribution to the current Credit Crisis;
Caller Matty asked John Key what he thought got the world into this position(Credit Crisis) John Key replied;
“Relatively quickly, you had a massive expansion of credit over the last decade or two, so basically the banks have gone and leant miles of money engaged in very risky behaviour, they have done it to to much of an extreme and whats happened is that eventually the chickens have come home to roost and its all imploded and yup, you know Wall St its got to take rensponsibility for its own excesses and its got it wrong, the good news is from New Zealands point of view is our banks haven't really engaged in that kind of behaviour and dont have exposure to the kind of counter parties that fell over, but unfortunately Mum and Dad owe a lot of money, not the government, the governments not at all indebted really, but Mum and Dad are and whats happened is that liquidity to fund their borrowing is drying up”.
John Tamahere asks;
“Ok, oh, exposure to the Australian banks”.
John Key replied;
“Yeh, look I tell you the thing with the Australian banks is, it, um we need to, ah in one sense weve got a bit of strength funnily enough, I know people, I mean I support KiwiBank, we are not selling it, we never going to sell it, but, but I do support the fact that because the Australian banks have quite a big part of our market, because they a bigger, theyre just bigger organisations thay can actually weather these storms a little bit, theres some upsides, I know a lot of people dont like them, but there are some upsides to having them in our economy. Secondly, we just got to make sure that, that wholesale guarantee which allows the New Zealand subsidiaries in their own name to be able to raise capital to be able to operate and weve got work with, not because we are trying bailout the banks, no one should be under that illusion, but if they cant borrow they cant lend and our economy is going into depression if that is the case.”

Is it time to call 'Fraud' on media and public servants proven to have been 'making money' for just parroting hand me downs they had no understanding of?

Is it time to call 'Fraud' on the majority of media and public servants proven to have been 'making money' for just parroting 'hand me downs' they had no understanding of ?

Iain Parker June 30 2013

Chris Trotter - New Zealand political commentator - had an article published nationwide by Fairfax Newspapers - June 28 2013 - 
( http://bowalleyroad.blogspot.co.nz/2013/06/making-money.html?showComment=1372377634650 ) – which proposed – in the main;

“The funny thing about money – given how vital it is to our lives – is that hardly anyone knows anything about how governments create their currencies, and even fewer understand why banks are allowed to ‘make’ money at all. Indeed, a recent British survey revealed that most people assume that a bank’s lending cannot exceed the value of its deposits. The idea that banks can, by means of a simple accounting entry, create hundreds of millions of dollars, tends to be greeted with considerable scepticism.”

end quote

New Zealand Prime Minister and former international investment banker - John Key -17 November 2012 - said;
“Our (Govt) debt to GDP levels by then will top at just under 30 percent - in other words - um - we'll be relatively lowly indebted compared to countries like America and Europe. But - I put it to you - we are a small open economy. We have high levels of private sector debt. We- mum and dad - have borrowed that debt effectively from foreigners - because their local bank has sourced that from foreigners.”

Chris Trotter has portrayed himself as having a better understanding than most of the internal dynamics of just from where - and what - currently circulates as New Zealand's money supply - and sadly he is correct - but still his article contained many misleading inaccuracies:

Chris Trotter said;

“But the truth of the matter is that only two things in this world “make” money: governments and banks. (If you’re ‘making’ money and you’re NOT one of those two things, then you’re a counterfeiter.)”

end quote

This statement displays a lack of knowledge of the fundamentals of money as a 'system' - as invented and intended - many thousands of years ago. The 'money system' was invented to improve upon barter – or raid - as an easier 'means of distribution' of 'goods or services' if scarce in your realm of influence. 

A 'money system' is a 'circulatory arterial system' made up of several layers. An accountancy system of 'contracts of credit' for 'future exchange of goods or services'. A 'monetising' of 'natural resource collateral' on the other side of a 'balance sheet' that must 'circulate' in the correct amounts - under the correct pressure - to keep the 'economic body' healthy. 

When size and trust allow it can be 'accounted' in the heads of trading partners as 'memories' only. But when on a larger more complex scale - involving more traders - a 'ledger entry accountancy system' is employed to keep the layers of the system in 'balance' and a 'token of exchange' is agreed upon as a 'go between' transferred to 'clear' - 'contracts of credit' - when the 'physical real trade' is proven complete. 

At this time - having served the 'productive purpose' for which it was authorised - having allowed the 'production' and 'distribution' of a 'goods' for 'consumption' - or built a 'physical asset' providing an ongoing 'service' - if there is no other 'real' productive purpose for it in the economy - in the interest of keeping the economy healthy - the 'token of exchange' needs to be 'retired from circulation' to maintain 'value' and 'confidence' in the system.

If a trade means immediate swapping of real physical goods or services available without trading partners leaving the line of sight of each other – no 'token of exchange' is required as the 'contract of trade' is immediately 'cleared' by whats clearly 'real' and 'readily available'.

When 'trade' requires a 'delayed clearing' of the 'contract of trade' out of line of sight of a 'trading partner' – a 'contract of credit' is required to be 'cleared' at a later time. It is this 'contract of credit' that is the 'essence of money' of which a physical 'token of exchange'- is agreed upon by trading partners - as a 'go between' - that 'represents' the 'contract of credit' - to be transferred at a later time to 'clear' it - after the delayed 'real physical trade' is 'proven complete'. 'Money' is a 'transfer'-'payment'-'settlement'- 'clearing house'- system.

If a person trades their 'services' for 'tokens of exchange' agreed upon by a wider community to 'represent' and be 'accepted' later as 'payment' to 'clear' other 'contracts of trade' - you have in-fact 'traded' and 'cleared' a 'negotiable contract of credit' within a 'money system'.

Thus 'money' is in-fact 'created' every day - in many forms - outside of governments and banks without being 'counterfeit'.

Chris Trotter seems to have confused 'counterfeit' with 'fiat'.

'Ponzi counterfeit money system fraud' is when a trading partner - or an administrator of a 'money system' - pursues short-term 'profits' from the soliciting of - or authorisation of - 'contracts of credit' - knowing that the 'clearing' of them was never possible in the normal course of business or within the boundaries of sustainable 'natural collateral'. They have 'made money' which they gained use of first while having no consideration for keeping in balance what is 'fiscally possible' with what is 'physically possible'.

'Fiat' is when a government decrees what form the 'token of exchange' will take - to be - 'lawfully accepted' as 'legal tender' in its boundaries of influence to 'clear' 'contracts of credit'.

The New Zealand Government currently decrees that we surrender the administration of 'our money system' to a foreign international private central banking network to 'issue' entirely as interest bearing loans. The interest and fees the private bankers charge are supposed to add up to fair reward - after running costs - for their acumen in keeping the 'money system' in 'sustainable balance'.

Despite history being littered with chapter upon chapter of slave-minded selfish monopolist's subverting and perverting the social intent of money as invented - the New Zealand Government swallowed the spin - that these private institutions - if allowed to administer the money system - they would do it for the greater good of humanity and not keep repeating their pyramid scamming crimes.

Surprise - surprise they did it again. 

It is the New Zealand Government that are currently far more 'a party to counterfeit fraud' -on a global grand scale never seen before - far in excess of any of its citizens and businesses of legitimate enterprise – who are in-fact being eaten alive by the financial trickery sector it co-ops.

Chris Trotter said;
“A reasonable policy, you might have thought, in the light of New Zealand’s over-valued dollar and the damage it is doing to the economy. But, no. The Green co-leader’s QE proposal was decried by politicians, journalists, bloggers and bank economists, as tantamount to “printing money”.

end quote

It is not dropping the value of the New Zealand dollar that will alleviate the distress of the average battler – but addressing the ever growing internal and external inequities caused by the entirely interest bearing – private loan based – money supply system – that we currently suffer.

Sadly it was both the Likes of Chris Trotter and Russel Norman's inability to articulate the various forms of 'monetary easing' that have incorrectly seen them all being referred to as 'printing money' - that might have seen a great opportunity missed to educate wider society to the pyramid aspects of the current private money supply system we suffer. 

Far more born of private bankers 'printing debt' as our money – than would be the government administration of a 'non interest bearing primary money system' of 'sovereign dollars' to fund our 'primary economic base of necessity of life infrastructure' to then be provided as a 'national dividend' as a 'public service' at the 'cheapest possible cost'.

Chris Trotter said;
“Sadly, the cacophony of ill-informed criticism directed at Dr Norman’s QE proposal was sufficient to bring about its withdrawal.

As I watched the Greens back away from their perfectly reasonable and generous plans, I wondered why we have heard no similar outcry against the QE being practised by this country’s Australian-owned banks.

Every month, New Zealand’s privately-owned financial institutions conjure billions of dollars out of thin air in the form of mortgages. No printing presses are required to ‘make’ this money – a computer does the job in a fraction of a second. And, when the mortgage is granted on an existing property, adding nothing to the nation’s stock of material assets, is the effect inflationary?”

end quote

New Zealand banks are not Australian owned. If you go to their annual reports – Shareholding Interests sections - where their 20 largest majority stakeholders are documented – you will inevitably find both New Zealand banks and their so-called Australia parents are in-turn majority stakeholder owned by the same very few private institutions that just happen to be the very same few private institutions who are the international money 'wholesalers' who hold the very few international banking lisences in existence. 

If you follow the ownership trail to the very end - they in-turn belong to the family trust funds of the worlds ultra-inter-generational-wealth-families.

The internal domestic banks of New Zealand & Australia earn profits by soliciting loans at a higher interest rate than they know they can refinance with at a 'discount' cheaper interest rate with the international 'money wholesalers' – who truly are the institutions - and their owners - as 'market liquidity underwriters' - who can buy into everything below them for nothing – but no body can buy into them – you have to be born into them.

As for the massive increase of money as debt supply of recent decades not showing up in the Consumer Price Index official measure of inflation - despite household debt v expendable income rising from 30% odd to 160% odd over the same period - this below government interaction re the subject makes very clear how the figures were 'doctored' to hide the greedy private banker fueled housing bubble beyond what our economy - or those on the average wage - could ever sustain in the normal coarse of business;

http://publiccreditorbust.blogspot.co.nz/2013/03/failure-of-interest-rate-inflation.html

20 February 2012 Deirdre Kent put this Official Information Act question to New Zealand Minister of Statistics;

- Despite the fact that section prices tripled in fifteen years to 2007, land is not now included in the Consumer Price Index. This means that the official measure of inflation is unreliable as it is far lower than the actual figure.

and received this reply;

Today I received a letter back from the Minister of Statistics, Hon Maurice Williamson. I had heard that land went out of the CPI but couldn’t remember when or why so I sent in an Official Information request. The Minister dates the letter 14 Mar 2012 and says;
Dear Ms Kent
Thank you for your letter of 20 February regarding the exclusion of the price of land from the Consumers Price Index (CPI) basket of goods.
I am advised by Statistics New Zealand that land (i.e. residential section) was included in the CPI until the June 1999 quarter. Following a review of the CPI in 1997 land was excluded, taking effect from the September 1999 quarter.
The 1997 review by an external advisory committee confirmed the CPI’s main purpose as being informing monetary policy setting, and that the CPI should be focussed on the concept of acquisition. The reason given for excluding land from the CPI from 1999 was that it was considered to represent the investment component of home ownership (with dwellings representing the shelter component).
The September 1999 quarter CPI information release explained it as follows: A dwelling provides shelter over a long period of time. Over time land is not consumed and so can be considered to represent the investment component of home ownership. As investment expenses are outside the scope of the CPI the rebased CPI excludes expenditure on residential sections.
Information on the sale of land is available from QV (www.qv.co.nz) and the Real Estate Insititute of New Zealand (www.reinz.co.nz).
I trust this information meets your needs and thank you again for taking the time to write.
Yours sincerely
Hon Maurice Williamson
Minister of Statistics.

End quote

I have recently waded my way through the transcripts of the 2013 Budget Debate speeches of the five Members of Parliament spread throughout my Taranaki region – Andrew Little – Johnathan Young - Shane Ardern – Chester Burrows – Tariana Turia – all of whom - if they have any knowledge of the internal dynamics of how New Zealand is currently funded – and the detrimental impact upon every aspect of daily life of every citizen – they sure are not letting on. Most blame the Global Financial Crisis as to why they cant deliver upon election promises and most lashed out at the Green Party's Russel Norman for talking 'voodoo economics' when mentioning having a 'real' conversation about how our nation is 'really' funded.

The exchange between New Zealand Prime Minister John Key and Leader of the Opposition Phil Goff  (November 9 2010) regarding the NZ dollar was very enlightening:
Labour leader Phil Goff earlier reiterated his party’s proposals on monetary policy, saying it should not just be reliant on the current objectives and the current tools.
“Clearly the [NZ] dollar is at such a high level that it’s helping to destroy the manufacturing industry in this country at the moment,” Goff said.
“We have to take that seriously and I would expect the government, with its army of bureaucrats, to have some answers, so far we've seen none,” he said.
John Key later retorted that Goff was talking about "the same army of bureaucrats that worked for Labour when it was in power".

Matt Taibbi - http://www.rollingstone.com/politics/blogs/taibblog?page=3 - who is now widely acknowledged in international circles as one of the hardest working investigative journalists looking into international financial system corruption – described in a recent speech how he had begun as a political reporter until one day he turned to a fellow Capital Hill reporter and asked if they were 'frauds' for just writing what they were told without knowing if its actually how it works. I would recommend any New Zealand media commentator watch that speech here;
Matt Taibbi 2013 Public Banking Institute Conference Speech (first 30 odd secs are a bit shaky)

and several of his now world renowned articles:

http://www.rollingstone.com/politics/news/everything-is-rigged-the-biggest-financial-scandal-yet-20130425

“If true, that would leave us living in an era of undisguised, real-world conspiracy, in which the prices of currencies, commodities like gold and silver, even interest rates and the value of money itself, can be and may already have been dictated from above. And those who are doing it can get away with it. Forget the Illuminati – this is the real thing, and it's no secret. You can stare right at it, anytime you want.”

http://www.rollingstone.com/politics/blogs/taibblog/you-f-ked-up-you-trusted-us-talking-ratings-agencies-with-chris-hayes-20130621

“I don't often get angered by the things press spokespeople say. Most of these people have difficult jobs and are often forced to be the public faces of policies they had nothing to do with creating.

But in this case, S&P just a few weeks before had sworn before a judge that its reassurances about objectivity, integrity and independence were not legally binding, vague, and so generalized as to be essentially meaningless.

Yet when I contacted this company, they sent me exactly, and I mean exactly, the same reassurances about objectivity, integrity, and independence that they themselves had laughed at as "mere puffery," "vague," and "so generalized that a reasonable investor would not depend" on them.

Then they went on to deride the plaintiffs in their lawsuit for not being smart enough to do their own research and make their own assessments about the meaning of an S&P rating, and the value of its reassurances of independence and integrity. Yet us reporters are apparently still expected to take such assurances at face value, which if my math is correct means that in their eyes, we must be even dumber than the investors in the products they rate. What a bunch of assholes!”

end quote

And of course New Zealand media and public servants if you want to know the truth from a New Zealand perspective – my very own;
http://publiccreditorbust.blogspot.co.nz/2013/04/universal-public-credit-public-policy.html

International Green Movement replacing International Labor Movement in challenging pyramid aspects of current private international supply side of money.

Preamble and declaration of principles of the Knights of Labor of America - 1885 - went on to become the founding ideal of the International Labor Movement throughout the world - actually implemented at times in every nation of Anglo-Saxon influence - but seemingly now long since forgotten by Labor Party's in them all;

http://www.chicagohistory.org/hadc/visuals/V0010.htm
TO THE PUBLIC:
The alarming development and aggressiveness of great capitalists and corporations, unless checked, will inevitably lead to the pauperization and hopeless degradation of the toiling masses.
It is imperative, if we desire to enjoy the full blessings of life, that a check be placed upon unjust accumulation, and the power for evil of aggregated wealth.
This much-desired object can be accomplished only by the united efforts of those who obey the divine injunction, "In the sweat of they face shalt thou eat bread."
Therefore we have formed the Order of Knights of Labor, for the purpose of organizing and directing the power of the industrial masses, not as a political party, for it is more - in it are crystallized sentiments and measures for the benefit of the whole people, but it should be borne in mind, when exercising the right of suffrage, that most of the objects herein set forth can only be obtained through legislation, and that it is the duty of all to assist in nominating and supporting with their votes only such candidates as will pledge their support to those measures, regardless of party. But no one shall, however, be compelled to vote with the majority, and calling upon all who believe in securing "the greatest good to the greatest number," to join and assist us, we declare to the world that are our aims are:

And we demand at the hands of Congress:

The establishment of a National monetary system, in which a circulating medium in necessary quantity shall issue direct to the people, without the intervention of banks; that all the National issue shall be full legal tender in payment of all debts, public and private; and that the Government shall not guarantee or recognize any private banks, or create any banking corporations.
That interest-bearing bonds, bills of credit or notes shall never be issued by the Government, but that, when need arises, the emergency shall be met by issue of legal tender, non-interest-bearing money.

end quote

The International Green Movement are now stepping up to champion equal economic opportunity where it appears the International Labor Movement now fear to tread;

GREENING THE DOLLAR MONETARY REFORM PLANK
Approved by the Platform Committee on July 11th, 2008 in Chicago.

http://www.monetary.org/greening-the-dollar-green-party-monetary-reform-plank/2008/07
To reverse the privatization of control over the money issuing process of our monetary system; and to reverse its resulting concentration of wealth and income; and to place it within a more equitable public system of governmental checks and balances; and to end the regular recurrence of severe and disruptive banking crises (such as the current so called “Sub Prime” mortgage crisis) the Green Party will move to:
A) Nationalize the 12 regional Federal Reserve Banks, reconstituting them and the Federal Reserve Systems Washington Board of Governors under a new Monetary Control Board in charge of the U.S. Treasury’s Comptroller of the Currency division, presently responsible for U.S. Government oversight of banking. All new money is to be created and initially put into circulation only by the U.S. Government. The private creation of money, or credit which substitutes for money will cease.

B) The Monetary Control Board will redefine bank lending rules and procedures to end the privilege banks now have to create money when they extend their credit, by ending the fractional reserve system in an elegant, non disruptive manner. Banks will be encouraged to continue as profit making companies, extending loans of real money at interest, but no longer creating what passes for money by loaning their credit.

C) The new money that must be regularly added to the system as population and commerce grow will be created and spent into circulation by the U.S. Government on infrastructure, including the “human infrastructure” of Education and Health Care. This begins with the $1.6 trillion the American Society of Civil Engineers warns us is needed to bring existing infrastructure to safe levels. Per capita guidelines will assure a fair distribution of such expenditures across the U.S.A., creating good jobs; revitalizing regional and local economies and the local governmental bodies serving them, from school boards to states.

(As this money is paid out to various contractors, they in turn pay their suppliers and laborers who in turn pay for their living expenses and ultimately this money gets deposited into banks, which are then in a position to make loans of this money, according to the new regulations).
end quote

NDP convention in 1995 and the Canadian Green Party convention last year both passed resolutions calling for a return to government borrowing from the Bank of Canada instead of the private banks. It would be in accordance with those resolutions for both parties to put this key monetary policy reform on their parliamentary agendas.
http://www.policyalternatives.ca/publications/monitor/ugently-needed-change-monetary-policy
An Ugently Needed Change in Monetary Policy
Borrowing from Bank of Canada would make governments debt-free
by George H. Crowell
National Office | The Monitor
Issue(s): Government finance
June 1, 2011

Through the publicly-owned Bank of Canada, which was established in 1935, the federal government can borrow money, essentially interest-free, and make such funds available not only for its own use, but also for provincial and municipal governments. Such borrowing helped Canada get out of the Great Depression, and to finance our participation in World War II. Continuation of this practice until the early 1970s played a key role in creating Canada’s post-war prosperity, as well as launching Medicare and other national social programs.

For the past four decades, however, our governments at all levels have increasingly been borrowing instead from the private banks, and paying steep interest on those mounting debts. Each year, governments across Canada now pay some $60 billion in interest on their debts – interest payments that need not be incurred.

This enormous debt burden deprives our governments of revenue that could be used for much-needed improvements to social and economic services – and also to help civil society groups that work for the public welfare. Such organizations depend largely on government funding, but are repeatedly told there is never enough money available.

Governments themselves also use their deliberately incurred borrowing debts as an excuse for cutting public programs and services instead of preserving and expanding them. At the same time, however, they keep cutting the tax rates on wealthy individuals and corporations who don’t need tax relief – and many of whom evade the taxes they owe, anyway, through tax loopholes or by hiding their wealth in offshore tax havens. There also doesn’t seem to be any shortage of funds for unnecessary new prisons, for unjustifiable military interventions, or the wasteful purchase of new weaponry.

One of the organizations that has tirelessly called for a return to government borrowing from the Bank of Canada is the Committee on Monetary and Economic Reform (COMER). Since its formation in the 1980s, COMER has produced reams of statistics, reasons and arguments for reviving the lending powers of the Bank of Canada. It has shown how the massive interest-bearing debt now carried by our federal and provincial governments could gradually be replaced with interest-free debt.

Such a change in monetary policy, combined with crucial changes in tax policy, would make available tens of billions of dollars that are urgently needed to rebuild our public infrastructure, protect our environment, and strengthen Medicare and other social programs so vital in meeting human needs. Such expanded government spending on worthwhile projects would also create jobs, stimulate additional economic activity, and significantly increase tax revenue.

To start a campaign for the monetary reforms needed to achieve these national gains, COMER recently issued a “call for the renaissance of the Bank of Canada.” The call is directed at civil society organizations. It urges them to join with COMER in demanding that the federal government revive the power of the Bank to provide funding to all levels of government, mainly with interest-free loans, as was done between 1935 and the early 1970s. These loans, of course, would be for needed public investments, primarily to protect and improve social programs and repair and build public infrastructure. (Go to the COMER website – www.comer.org -- to read the full text of the call.)

COMER has been dismayed that civil society groups have not pushed for these changes in monetary policy on their own, since it could make abundant funding available to meet a wide range of the social and environmental needs for which they advocate. This is perhaps because they are unaware of this possible answer to their funding shortages. The COMER campaign hopes to raise their awareness as it calls for their endorsements.

Of course the COMER people have to be realistic. They know the monetary policy changes they propose challenge the power of the private banking system, and they know this system has the support of the new majority Harper government. But the enhanced status of the NDP in the new Parliament (and the election of the first Green Party candidate, leader Elizabeth May) heightens the prospect that a revival of the Bank of Canada’s lending powers will be more frequently and effectively raised in the House of Commons. (Maybe every time the Conservatives cite the debt as an excuse for cutting social programs and services.)

Significantly, the NDP convention in 1995 and the Green Party convention last year both passed resolutions calling for a return to government borrowing from the Bank of Canada instead of the private banks. It would be in accordance with those resolutions for both parties to put this key monetary policy reform on their parliamentary agendas.

Indeed, it may be essential for the opposition to take this stand in the House, if only to deter Harper from making the Bank of Canada even less beneficial to the public interest. This could happen if Harper decides to act on his earlier support for the creation of a common U.S.-Canadian currency, or to bring Canada into a proposed new global currency system – both, of course, controlled by the private bankers. Such a loss of monetary policy independence would gravely impair the Canadian campaign for monetary justice.

Right now, however, the renaissance of the Bank of Canada, though very difficult, is not beyond achievement. Particularly if the campaign garners the support it deserves from the civil society groups that now suffer so much from the Bank’s disuse.

(George Crowell is a retired University of Windsor professor who has been working with COMER on monetary policy since 1994.)

end quote

Recently - for a period of time - The New Zealand Green Party joined the growing International Green Movement in challenging the pyramid aspects of the current internatonal supply side of money  - but unfortunately have since - at present - backed down for political expedience after coming under pressure for their stance - ironically much of it from the New Zealand Labour Party;

Russel Norman – New Zealand Green Party Co-leader - made headlines this week – 19 June 2013 Greens-U-turn-wont-quiet-John Key - for doing a public backflip on looking into alternative ideas to what is currently said to be “Generally accepted worldwide best practice monetary policy” – and New Zealand media - in the main - painted him as a loser.

Russel Norman already having displayed a sense of growing environmental and social injustice - had “come out” - asking hard questions of the current money system orthodoxy after his 21 Feb 2013 International Finance Agreement Amendment Bill third reading - now law - in which Russel Norman admitted to having only recently gained an understanding of just how New Zealand money supply originates and under what terms and conditions;
http://www.parliament.nz/en-NZ/PB/Debates/Debates/7/a/8/50HansD_20130221_00000020-International-Finance-Agreements-Amendment.htm
Russel Norman;
"The other thing that comes out of, I think, the IMF that surprises a lot of people is when the IMF says things like most of the money that is generated is generated by the private banks. Most of us, I think—and I was certainly one of these people, until reading IMF papers—always assume that the Government created the money. That is just because I actually did not follow it closely enough, whereas the IMF is very clear that it is the private banks that create most of the money. What the IMF—or, at least, some of the researchers within the IMF—is now saying is that the Government should use its ability to create money, so that there is some publicly created money as well as the privately created money, most of which is created by the private banks.
This, of course, is a pretty radical proposition, and the IMF, in putting forward this proposition, has certainly been shaking the policy debates around monetary policy all over the world, except in New Zealand, of course, where we are kind of locked into some weird backwater where the Government does not want to have a debate around any of this kind of stuff. But if you read the international literature, it is pretty good."
end quote

I myself was very disappointed that Russel Norman it seemed – after all was said and done – had “come out” before having done sufficient personal research to defend the subject when attacked in public by proponents of the current system - despite how far the debate has moved internationally at the very highest levels of the international supply side of money – about the pyramid aspects of it. But I do not concur with those making comment that anyone admitting such a lack of knowledge of monetary matters so late in the piece should be the leader of any political party.

I say this because there are already plenty of so-called public representatives who have a full knowledge of the pyramid aspects of New Zealands money system arrangements - that have - for various reasons - chosen to make it very much an officially sanctioned cover up that does not take to much looking to prove.

New Zealand Prime Minister and former international investment banker John Key -17 November 2012;
“Our (Govt) debt to GDP levels by then will top at just under 30 percent, in other words, um, we'll be relatively lowly indebted compared to countries like America and Europe, but I put it to you we are a small open economy, we have high levels of private sector debt, we, mum and dad, have borrowed that debt effectively from foreigners because their local bank has sourced that from foreigners.”
end quote

Private corporations now govern America by buying influence over political process. Read this 31 May 2013 New Zealand Parliamentary report to understand how these influences pass down due to the fact that what currently circulates as our entire money supply originates as loans owed to those very same foreign corporations;
http://www.parliament.nz/en-NZ/PB/SC/Documents/Reports/b/4/2/50DBSCH_SCR5862_1-Public-Finance-Fiscal-Responsibility-Amendment-Bill.htm
"The Act does not mention monetary policy. The majority of us understand that in doing so, the bill aims to ensure that governments take explicit note of the fact that fiscal policy and monetary policy are interdependent; and that different fiscal strategies can prompt different monetary policy responses."
end quote

Its become apparent from official documents that the reason our so-called public representatives don't tell us we are being governed under conditions of receivership by foreign creditors is because quote "The majority of us understand" - Well I say New Zealand wider society are far more suffering an officially sanctioned cover up by parliament than any fully informed resignation to what is economic slavery by way of predatory lending from institutions who knew it was never mathematically repayable from the day it was issued.

This is not only evident in the above mentioned report - but throughout the parliamentary debate regards International Monetary Fund(IMF) regulations becoming automatic New Zealand law without passing through NZ parliament for debate;
http://www.parliament.nz/en-NZ/PB/Legislation/Bills/d/f/f/00DBHOH_BILL11131_1-International-Finance-Agreements-Amendment-Bill.htm

Hon BILL ENGLISH: “I intend to move that the bill be referred to the Finance and Expenditure Committee. Our commitments to the IMF are effectively premiums to an insurance policy against damage to our economy from an unstable world....... New Zealand has already agreed to these changes, and adopting the International Finance Agreements Amendment Bill simply puts that agreement into practice......The bill also creates a regulation-making power in the principal Act so that further updates to the articles can be made by regulation. This power will simplify the process by which New Zealand meets its obligations. Once changes to the articles are agreed to by the requisite majority of members of the international financial institutions, New Zealand will be bound by the amendments, which means that we are required to bring our domestic legislation into line with our international obligations.”

Hon DAVID PARKER (Labour) : “I rise to speak to this bill, the International Finance Agreements Amendment Bill, on behalf of the Labour Party. The Labour Party will be supporting this bill to the Finance and Expenditure Committee. The Labour Party supports the function of the International Monetary Fund and the International Bank for Reconstruction and Development, and broadly agrees with the Minister of Finance that these are good institutions that assist the conduct of international economic affairs in a way that benefits New Zealand as well as other countries......I think New Zealanders will have more confidence in our participation in these international fora if they think that Governments are being transparent about changes to those international agreements and the effect of those changes on New Zealand. There is already enough suspicion out there as to the effect of international agreements. We breed further suspicion if we are not open and transparent about changes to those rules......For those reasons, amongst others, the Labour Party opposes future changes to this legislation by way of the statutory regulation-making power that this amendment Act creates. We believe that future amendments ought to come back to this Parliament. If we look back in the history, it has not been an onerous task for New Zealand to amend this legislation through annual amendments or anything like that. It is relatively rare that we have amendments to this International Finance Agreements Act, which dates back to 1975. “
end quotes

You will note that immediately Russel Norman broached the control of the issuance of money subject - most every other New Zealand political party Economic Executive – all of who are - in the main - foreign financial institution higher educated - immediately attacked Russel in the most vicious way as a 'fringe nutter' preaching 'voodoo economics' - this despite Brazil, Russia, India, China, Japan, Argentina etc currently practicing public credit creation and every Anglo-Saxon nation in the past - at which times they enjoyed no better equitable prosperity - having issued 'sovereign dollars' free of private banker interest & fees to fund their primary economic base of necessities of life to be supplied as a public service at the cheapest possible cost.

Russel Norman made clear his views again - and clearly had not yet buckled - in this 27 May 2013 article;
http://publiccreditorbust.blogspot.co.nz/2013/06/new-zealand-green-party-join.html
"In the debate around monetary policy, it is often forgotten that the default position is that the private banks create most of the money and lead the increase in the monetary supply. They then charge interest to the users of the money that they have created......The debate should be: what constraints should apply to the private creation of money given the banks’ irresponsible behaviour in the past; and should the public institutions be expanding money supply as a policy tool, to what extent, and to what purpose? Should the state be allowed to also increase the money supply for public purposes such as refilling the Natural Disaster Fund and to see what effect it can have on reducing the very damaging high NZ dollar?
The answers to these questions aren’t black and white but for my pick I think we need to restrain the banks lending into the housing bubble and use a trial public creation of money to restock the Natural Disaster Fund – both to be prepared for future disasters and to see what impact it would have on the dollar.
It is of course difficult to have a rational conversation around these issues in the current political context (ie Key’s scaremongering) but it is an important conversation for rational adults to have. We do have an out of control current account deficit and if we want to be masters of our own destiny we need to change policy settings as under Key’s plan our deficit and debt increase dramatically."
end quote

What is made clear from Russel Norman's musings of our current money supply being 'partly funded offshore' is that he does not yet fully comprehend just how it works - and is very poor at being able to articulate the various forms of monetary easing - those that only favour the private bankers and those that dont.

New Zealand mainstream media senior editors have let New Zealand down no less than Russel Norman who they set out to ridicule.

TV3 Patrick Gower & TV1 Corin Dann just might be the highest paid clowns in New Zealand's economic circus! Radio New Zealand Jim Mora - I am quessing one of the lowest paid clowns - knows who the ring master is - but chooses to sweep it under the carpet?

New Zealand Prime Minister and former international investment banker John Key 17 November 2012;
“Our (Govt) debt to GDP levels by then will top at just under 30 percent, in other words, um, we'll be relatively lowly indebted compared to countries like America and Europe, but I put it to you we are a small open economy, we have high levels of private sector debt, we, mum and dad have borrowed that debt effectively from foreigners because their local bank has sourced that from foreigners.”

TV3 Patrick Gower;
"The Prime Minister lost use of one of his favourite political weapons today, thanks to a policy U-turn by the Greens over printing money to improve the exchange rate."
"Known as 'quantitative easing', it's been done by some of the world's big economies."
http://www.3news.co.nz/Greens-U-turn-wont-quiet-Key/tabid/1607/articleID/302045/Default.aspx

TV1 Corin Dann;
"It is after all exactly the policy that's been used by the US Central bank for the last couple of years to prevent deflation and keep the US economy afloat."
http://tvnz.co.nz/politics-news/corin-dann-greens-had-drop-money-printing-5469780

RNZ Jim Mora;
"Banks have ended up in the position, as Bernard Hickey has said a time or two on the panel, where they have the franchise on the creation of money"
http://publiccreditorbust.blogspot.co.nz/2013/03/westpac-new-zealand-senior-economist.html

You lazy fools - its not 'exactly' the same at all - you have the same problem in reporting on this matter as Russel Norman did trying to sell it as policy - you have not done you research - because if you had you would discover the truth is not hard to find - as documented beyond any reasonable doubt in my research here;
http://publiccreditorbust.blogspot.co.nz/2013/04/universal-public-credit-public-policy.html

What dictates if Quantitative Easing benefits your nation or only private bankers - is if the money trail of your central bank traces back to your public institutions being the lender of last resort or if your public institutions have contracted out that privilege and become just a conduit of the international private banking network.
QE occurs when even if interest rates are heading to zero the economy remains flat because society has no more compacity to borrow money into circulation - so the lender of last resort then simply gets to type some money into their computer and start directly buying distressed assets of all kinds out in the market as direct stimulus. If your central bank - as is the case in New Zealand - has just become a conduit for private banking institutions - the private banking institutions gain heaps for nothing - but if your money issuance trial leads to a public institution - such as in the case of Japan who's government is typing the money into their account and buying up distressed assets - it will internally re-balance your economy.

Japan is now an enviable position it tries to play down for some very interesting reasons;
http://www.webofdebt.com/articles/mythjapan.php
Properly directed, the national debt becomes the spending money of the people. It stimulates demand, stimulating productivity. To keep the system stable and sustainable, the money just needs to come from the nation’s own government and its own people, and needs to return to the government and people.

The IMF is all good with what Japan is doing and what Greens were discussing;
http://www.nationmultimedia.com/breakingnews/IMF-backs-Japans-monetary-easing-30207337.html
Tokyo - "The International Monetary Fund on Friday endorsed the aggressive monetary easing measures taken by the Bank of Japan in April."

The issuance of Sovereign Public Credit - backed by the natural reserves of the nation - is not done to lower the exchange rate - but about addressing our ever increasing internal & external systemic inequities!

New Zealand Green Party backs down on challenging pyramid aspects of current international supply side of money.

Russel Norman – New Zealand Green Party Co-leader - made headlines this week – 19 June 2013 Greens-U-turn-wont-quiet-John Key - for doing a public backflip on looking into alternative ideas to what is currently said to be “Generally accepted worldwide best practice monetary policy” – and New Zealand media - in the main - painted him as a loser.

Russel Norman already having displayed a sense of growing environmental and social injustice - had “come out” - asking hard questions of the current money system orthodoxy after his 21 Feb 2013 International Finance Agreement Amendment Bill third reading - now law - in which Russel Norman admitted to having only recently gained an understanding of just how New Zealand money supply originates and under what terms and conditions;
https://www.parliament.nz/en/pb/hansard-debates/rhr/document/51HansD_20151112_00000020/international-finance-agreements-amendment-bill-third
Russel Norman;
"The other thing that comes out of, I think, the IMF that surprises a lot of people is when the IMF says things like most of the money that is generated is generated by the private banks. Most of us, I think—and I was certainly one of these people, until reading IMF papers—always assume that the Government created the money. That is just because I actually did not follow it closely enough, whereas the IMF is very clear that it is the private banks that create most of the money. What the IMF—or, at least, some of the researchers within the IMF—is now saying is that the Government should use its ability to create money, so that there is some publicly created money as well as the privately created money, most of which is created by the private banks.
This, of course, is a pretty radical proposition, and the IMF, in putting forward this proposition, has certainly been shaking the policy debates around monetary policy all over the world, except in New Zealand, of course, where we are kind of locked into some weird backwater where the Government does not want to have a debate around any of this kind of stuff. But if you read the international literature, it is pretty good."

end quote

I myself was very disappointed that Russel Norman it seemed – after all was said and done – had “come out” before having done sufficient personal research to defend the subject when attacked in public by proponents of the current system - despite how far the debate has moved internationally at the very highest levels of the international supply side of money – about the pyramid aspects of it. But I do not concur with those making comment that anyone admitting such a lack of knowledge of monetary matters so late in the piece should be the leader of any political party.

I say this because there are already plenty of so-called public representatives who have a full knowledge of the pyramid aspects of New Zealands money system arrangements - that have - for various reasons - chosen to make it very much an officially sanctioned cover up that does not take to much looking to prove.

New Zealand Prime Minister and former international investment banker John Key -17 November 2012;
“Our (Govt) debt to GDP levels by then will top at just under 30 percent, in other words, um, we'll be relatively lowly indebted compared to countries like America and Europe, but I put it to you we are a small open economy, we have high levels of private sector debt, we, mum and dad, have borrowed that debt effectively from foreigners because their local bank has sourced that from foreigners.”

end quote

Private corporations now govern America by buying influence over political process. Read this 31 May 2013 New Zealand Parliamentary report to understand how these influences pass down  due to the fact that what currently circulates as our entire money supply originates as loans owed to those very same foreign corporations;
http://www.parliament.nz/en-NZ/PB/SC/Documents/Reports/b/4/2/50DBSCH_SCR5862_1-Public-Finance-Fiscal-Responsibility-Amendment-Bill.htm
"The Act does not mention monetary policy. The majority of us understand that in doing so, the bill aims to ensure that governments take explicit note of the fact that fiscal policy and monetary policy are interdependent; and that different fiscal strategies can prompt different monetary policy responses."

end quote

Its become apparent from official documents that the reason our so-called public representatives don't tell us we are being governed under conditions of receivership by foreign creditors is because quote "The majority of us understand" - Well I say New Zealand wider society are far more suffering an officially sanctioned cover up by parliament than any fully informed resignation to what is economic slavery by way of predatory lending from institutions who knew it was never mathematically repayable from the day it was issued.

This is not only evident in the above mentioned report - but throughout the parliamentary debate regards International Monetary Fund(IMF) regulations becoming automatic New Zealand law without passing through NZ parliament for debate;
http://www.parliament.nz/en-NZ/PB/Legislation/Bills/d/f/f/00DBHOH_BILL11131_1-International-Finance-Agreements-Amendment-Bill.htm

Hon BILL ENGLISH: “I intend to move that the bill be referred to the Finance and Expenditure Committee. Our commitments to the IMF are effectively premiums to an insurance policy against damage to our economy from an unstable world....... New Zealand has already agreed to these changes, and adopting the International Finance Agreements Amendment Bill simply puts that agreement into practice......The bill also creates a regulation-making power in the principal Act so that further updates to the articles can be made by regulation. This power will simplify the process by which New Zealand meets its obligations. Once changes to the articles are agreed to by the requisite majority of members of the international financial institutions, New Zealand will be bound by the amendments, which means that we are required to bring our domestic legislation into line with our international obligations.”

Hon DAVID PARKER (Labour) : “I rise to speak to this bill, the International Finance Agreements Amendment Bill, on behalf of the Labour Party. The Labour Party will be supporting this bill to the Finance and Expenditure Committee. The Labour Party supports the function of the International Monetary Fund and the International Bank for Reconstruction and Development, and broadly agrees with the Minister of Finance that these are good institutions that assist the conduct of international economic affairs in a way that benefits New Zealand as well as other countries......I think New Zealanders will have more confidence in our participation in these international fora if they think that Governments are being transparent about changes to those international agreements and the effect of those changes on New Zealand. There is already enough suspicion out there as to the effect of international agreements. We breed further suspicion if we are not open and transparent about changes to those rules......For those reasons, amongst others, the Labour Party opposes future changes to this legislation by way of the statutory regulation-making power that this amendment Act creates. We believe that future amendments ought to come back to this Parliament. If we look back in the history, it has not been an onerous task for New Zealand to amend this legislation through annual amendments or anything like that. It is relatively rare that we have amendments to this International Finance Agreements Act, which dates back to 1975. “

end quotes

You will note that immediately Russel Norman broached the control of the issuance of money subject - most every other New Zealand political party Economic Executive – all of who are - in the main - foreign financial institution higher educated - immediately attacked Russel in the most vicious way as a 'fringe nutter' preaching 'voodoo economics' - this despite Brazil, Russia, India, China, Japan, Argentina etc currently practicing public credit creation and every Anglo-Saxon nation in the past - at which times they enjoyed no better equitable prosperity - having issued 'sovereign dollars' free of private banker interest & fees to fund their primary economic base of necessities of life to be supplied as a public service at the cheapest possible cost.

Russel Norman made clear his views again - and clearly had not yet buckled - in this 27 May 2013 article;
http://publiccreditorbust.blogspot.co.nz/2013/06/new-zealand-green-party-join.html
"In the debate around monetary policy, it is often forgotten that the default position is that the private banks create most of the money and lead the increase in the monetary supply. They then charge interest to the users of the money that they have created......The debate should be: what constraints should apply to the private creation of money given the banks’ irresponsible behaviour in the past; and should the public institutions be expanding money supply as a policy tool, to what extent, and to what purpose? Should the state be allowed to also increase the money supply for public purposes such as refilling the Natural Disaster Fund and to see what effect it can have on reducing the very damaging high NZ dollar?
The answers to these questions aren’t black and white but for my pick I think we need to restrain the banks lending into the housing bubble and use a trial public creation of money to restock the Natural Disaster Fund – both to be prepared for future disasters and to see what impact it would have on the dollar.
It is of course difficult to have a rational conversation around these issues in the current political context (ie Key’s scaremongering) but it is an important conversation for rational adults to have. We do have an out of control current account deficit and if we want to be masters of our own destiny we need to change policy settings as under Key’s plan our deficit and debt increase dramatically."
end quote

What is made clear from Russel Norman's musings of our current money supply being 'partly funded offshore' is that he does not yet fully comprehend just how it works - and is very poor at being able to articulate the various forms of monetary easing - those that only favour the private bankers and those that dont.

New Zealand mainstream media senior editors have let New Zealand down no less than Russel Norman who they set out to ridicule. 

TV3 Patrick Gower & TV1 Corin Dann just might be the highest paid clowns in New Zealand's economic circus! Radio New Zealand Jim Mora - I am quessing one of the lowest paid clowns - knows who the ring master is - but chooses to sweep it under the carpet?

New Zealand Prime Minister and former international investment banker John Key 17 November 2012;
“Our (Govt) debt to GDP levels by then will top at just under 30 percent, in other words, um, we'll be relatively lowly indebted compared to countries like America and Europe, but I put it to you we are a small open economy, we have high levels of private sector debt, we, mum and dad have borrowed that debt effectively from foreigners because their local bank has sourced that from foreigners.”

TV3 Patrick Gower;
"The Prime Minister lost use of one of his favourite political weapons today, thanks to a policy U-turn by the Greens over printing money to improve the exchange rate."
"Known as 'quantitative easing', it's been done by some of the world's big economies."
http://www.3news.co.nz/Greens-U-turn-wont-quiet-Key/tabid/1607/articleID/302045/Default.aspx

TV1 Corin Dann;
"It is after all exactly the policy that's been used by the US Central bank for the last couple of years to prevent deflation and keep the US economy afloat."
http://tvnz.co.nz/politics-news/corin-dann-greens-had-drop-money-printing-5469780

RNZ Jim Mora;
"Banks have ended up in the position, as Bernard Hickey has said a time or two on the panel, where they have the franchise on the creation of money"
http://publiccreditorbust.blogspot.co.nz/2013/03/westpac-new-zealand-senior-economist.html

You lazy fools - its not 'exactly' the same at all - you have the same problem in reporting on this matter as Russel Norman did trying to sell it as policy - you have not done you research - because if you had you would discover the truth is not hard to find - as documented beyond any reasonable doubt in my research here;
http://publiccreditorbust.blogspot.co.nz/2013/04/universal-public-credit-public-policy.html

What dictates if Quantitative Easing benefits your nation or only private bankers - is if the money trail of your central bank traces back to your public institutions being the lender of last resort or if your public institutions have contracted out that privilege and become just a conduit of the international private banking network.
QE occurs when even if interest rates are heading to zero the economy remains flat because society has no more compacity to borrow money into circulation - so the lender of last resort then simply gets to type some money into their computer and start directly buying distressed assets of all kinds out in the market as direct stimulus. If your central bank - as is the case in New Zealand - has just become a conduit for private banking institutions - the private banking institutions gain heaps for nothing - but if your money issuance trial leads to a public institution - such as in the case of Japan who's government is typing the money into their account and buying up distressed assets - it will internally re-balance your economy.

Japan is now an enviable position it tries to play down for some very interesting reasons;
http://www.webofdebt.com/articles/mythjapan.php
Properly directed, the national debt becomes the spending money of the people. It stimulates demand, stimulating productivity. To keep the system stable and sustainable, the money just needs to come from the nation’s own government and its own people, and needs to return to the government and people.

The IMF is all good with what Japan is doing and what Greens were discussing;
http://www.nationmultimedia.com/breakingnews/IMF-backs-Japans-monetary-easing-30207337.html
Tokyo - "The International Monetary Fund on Friday endorsed the aggressive monetary easing measures taken by the Bank of Japan in April."

The issuance of Sovereign Public Credit - backed by the natural reserves of the nation - is not done to lower the exchange rate - but about addressing our ever increasing internal & external systemic inequities!