It is difficult to judge which piece of news was more devastating to New Zealanders this week: the unexpected credit rating downgrades from both Fitch and Standard & Poor’s, or the equally unexpected World Cup tournament ending injury to All Black stand out, Dan Carter. In the short term, neither development had much effect over the weekend: opposition Labour party leadership blew some hot air at the National government, and the All Blacks beat Canada 79 – 15. But the long term outlook for both offers significant challenges.
I’m neither a financial nor rugby analyst, but I reckon the Wallabies (if they beat the Springboks) could be as tough on the depleted ABs as the Aussie banks will be on indebted Kiwis. Another headline last week about the NZ Rugby Union claiming they may not be able to afford the send the ABs to World Cup 2015 brings up an equally interesting question: will England be able to host it? Current austerity measures in the UK are accompanied by civil unrest, and the 2012 Olympics are likely to run at a massive economic loss. How jolly will Ol’ England be after that?
Interestingly, there only seems to be one growth industry creating jobs. This headline from the USA.
Debt is dangerous. Personal debt is dangerous. Household debt is dangerous. Municipal debt is dangerous. National debt is dangerous. I don’t know how else to put it. This next headline is an example of what debt can lead to. I need not go into inflated housing prices, sketchy mortgage agreements, and people with eyes bigger than their wallets. But debt never forgets, and even people who walked away from their mortgages are being tracked down by debt collectors (see above) and the courts.
While I have no overt love of suburbs, I sold my 38 acre farm – among the most sustainable properties in North America – and now live in a suburb with plenty of poverty. We made this choice to demonstrate that living green and living on the smell of an oily rag are highly compatible. Our power bill is pennies per day, our transportation tab is similar, and our grocery bill is falling monthly as we convert a weed-infested lawn into vegetable gardens, food forests and poultry pastures. We have been fortunate that decades of fiscal conservatism has allowed us to do this without going into debt. But we also realize that this is extremely rare for individuals living in OECD nations. Considering that, the best, most sustainable, most genuine effort any government could make to help the PEOPLE live more sustainably ecologically and economically is to offer zero interest loans for energy efficiency measures in the home.
Insulation, solar hot water, Energy Star appliances, etc. pay a far better return on investment than any term deposit or certificate of deposit in any bank. Congratulations to the state of Massachusetts, USA for offering zero interest energy loans. It is time governments around the world followed suit and served the PEOPLE and instead of the BANKS.
Until then, live within your means, save your pennies, avoid debt and pay cash.