Merryl Lynch credentials

National leader John Key recently cited his work experience at investment bank Merrill Lynch as a the kind of experience that suited him to be PM.

Key was a top money trader at the bank before he entered politics. While to some extent that is history and he can't be blamed for that company's difficulties neither should we accept that this experience is good for the country. It is the high risk, short term, make-money-at-whatever-cost mentality of such banks that got them into trouble and will get NZ in trouble if we follow the same strategy. The only credentials that Merrill Lynch offers John Key is the fact that he has the same DNA as investment bankers, he is wired in the same way, he has the same primary motivation and if allowed to lead the country will head us on the same precarious path. And if i may add another metaphor to my colourful mix "a leopard can't change its spots".


As Micheal Cullen said just last week

"He [Key] has got a short-term profit-maximising mentality, and that is what has brought Merrill Lynch and Lehman Brothers . . . to their knees. Do you want someone like that running the New Zealand economy when we are going to be going through a difficult period?" (Press, 17 Sep 2008)

Greed cometh before a fall

GREED and Capitalism

Another American bank falls over and Alan Greenspan of the Federal reserve says it is a 'correction in the market' the like of which happens about every 50 or 100 years. It is the worst correction since the 1929 stock market crash which lead to the Great Depression. In NZ finance companies are toppling over at record rates. Investors have lost millions and house prices have slumped. Is this just what you have to put up with in a free market economy or is it a sign that the free market actually needs some regulation and intervention?
There is a common factor in all of this and its the old deadly sin of greed. It is greed that causes banks to make ridiculous loans to people who can not afford them. Its greed that drives consumer demand for high interest rate returns and high risk investments. Its greed that causes people to speculate on the property market pushing house prices to extraordinary levels. No doubt greed will be a factor as people now seek to take advantage of other peoples misfortunes, in lawyers fees for extended legal battles, mortgagee sales, and further speculation in the property market. Its a high risk game with few winners and lots of losers. Free market capitalism is a natural ally of human greed and for this reason alone we need a third way in the economy that allows for enterpise and industry to be rewarded but greed to be kept in check.