Green Shoots, surveys of optimism, an economist believes….

We.re an optimistic lot. Without ascertaining anything in the way of facts, the recession is over. We’ve had ‘green shoots’ for a few months now, and it’s spring. We want things to be better, so they will be. We want to get richer, and nothing will stop that. We have sunk to the point that National Radio, last bastion of correctness  and responsible journalism, is down to reporting : “an economist believes”.

That’s news?  Fact?  We’ve drifted a long way from research, checking and thought. You expect it of Business Editors.They move in suited circles, and it rubs off. Some, like Tim Hunter of the Sunday Star Times, have succumbed to the temptation to have a flutter (sorry, investment) themselves, which goes close to having a vested interest in the system’s continuance. Hard for them to have an unbiased eye.

So what will happen?  Readers here know that I think energy-supply curtailment will curtail the amount of work do-able, and that more and more people want a share of that energy. Meaning that our per-head work available is shrinking. There is one thing I’ll allow – there may be room for efficiencies, and a change in the way we use the energy. There will almost certainly be less sunday trips to the beach, for instance, but chainsaw use will probably not alter.

The question is: will that increase fiscal activity?  To my way of thinking, no. The payment for the trip to the beach just displaced some other discretionary spend. The only way to get better, is to get more efficient, but to do that on the back of a 2 – 6% depletion rate, amidst increasing competition, with existing infrastructure?  A law of diminishing returns. Surely.

Will ‘the economy pick up?  Well, from the standpoint of such a low base, yes. From where we were in mid-08, no. Can’t see how it can. Rev up and bang, then.  I suspect we will stagger up and down for 3-5 years yet, until realism beats optimism. No doubt the reactionaries will then blame the likes of me for being Cassandra’s. So be it. The interesting question for New Zealand is whether we see another election round in the process, or whether the need for new thinking cones before 2011. I can’t tell that one. Here’s hoping, though.

The big problem, is that information comes from the media, and the media are 100% in cloud-cuckoo land at present. A total brain-wash. Converting them wasn’t what I contemplated, when I first started hollering. I just presumes they’d do the research, and present the facts. I guess they have mortgages too. Where’s Seymor Hersh?

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