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23 October 2016

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The economist, Steven Keen, has been remonstrating about private debt to GDP ratio for many years yet banks are allowed to introduce mechanisms such as tap and go or PayWay, which exacerbate the problem.

A casual stroll through any Westfield shopping town in Australia reveals the majority of people are shopping on credit and to quote Marcus Tullius Cicero, a prevalence of credit leads to war.

The Big Short movie provided a fabulous insight into how these scumbags operate, yet nothing has changed since 2007.

And most of this money is owed to the banks.

Makes me wonder why I resigned from the National Bank in 1966 to go to PNG.

Oh yes, that's right, excruciating boredom, I remember now.

This article exposes the willingness of the PNG government and, worse still, its key economic officials, to deliberately view the world through rose coloured glasses.

The use of terms such as "challenges in the short term", allows them to acknowledge the current very serious budget and fiscal problems whilst effectively ignoring their ominous implications.

In this regard, they are singing from the same hymn book as so many other governments and central bankers around the world who, having inflated the largest debt fuelled asset bubble in history, can now only stare at their creation in horrified disbelief.

With total debt across the world now around US$200 trillion, the entire world economy is balanced on the head of a pin.

No-one knows what event will trigger the inevitable collapse, when the debt fuelled bubble finally implodes, but everyone knows it will be very, very painful.

PNG is, like Australia, very vulnerable to severe economic downturns in places like the USA or China. Our politicians know this and so remain resolutely upbeat, in public at least, for fear of inadvertently precipitating the economic catastrophe that they all fear is imminent.

Of course, I could just be another damned fool who doesn't know a Collateralised Debt Obligation from a Credit Default Swap, but history strongly suggests that my gloomy prognostications will turn out to be right.

Tsk, tsk, tsk!

"We are not earning as much as we thought would be earning" (a)

"What we are trying to do is to make sure that we don't keep borrowing beyond our means.” (b)

"We are not as bad as many other countries in the world,” (c)

These are statements from a senior public servant in charge of the national economy...?

It sounds like he's a champion rump-fed, clap-mouthed, knob-head, for (a), (b) and (c), respectively.

Diarrhea, very, of The Human Centipede we call the petty O'Neill government.

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