Hard News by Russell Brown

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Hard News: Unwarranted risk

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  • Rich of Observationz, in reply to James W,

    That's not economics, it's accounting:

    Say I own a grocery store.

    It's worth $100k. I have a ($100k) mortgage that costs me 8%, so $8k a year. (finance cost)

    The store makes $10k a year (profit) , but I only draw out $5k of that (dividend). So it's costing me $3k in cash, but I'm salting away $5k a year in the stores bank account (retained earnings)

    If I sell the store and pay the mortgage off, then I ostensibly save the $3k cash. But I'm losing the $2k a year of net retained earnings, so in reality I'm losing out.

    That's basically the situation. You could also try modelling it with matchsticks.

    Back in Wellington • Since Nov 2006 • 4218 posts Report Reply

  • BenWilson, in reply to Russell Brown,

    The thing he is responsible for, however, is the Auckland Council's demand for a 12% return on assets.

    So yeah, I suspect things are getting a wee bit complicated for Len right now.

    Yup, there's a much bigger picture than that 12% for him to think about, and even within such a narrow constraint there's good reason for concern. Union busting activity, and intensified industrial action could go very sour for the business of the port. Not just the port either, but all the businesses that rely on the smooth operation of it, a very large number of which are in Auckland.

    Auckland • Since Nov 2006 • 8027 posts Report Reply

  • DeepRed, in reply to BenWilson,

    Yup, there’s a much bigger picture than that 12% for him to think about, and even within such a narrow constraint there’s good reason for concern. Union busting activity, and intensified industrial action could go very sour for the business of the port.

    Especially if the ITF hauls out its port-of-convenience ICBM. Still no update on the ITF website, most likely due to timezone issues (it’s HQ’ed in London).

    The southernmost capital … • Since Nov 2006 • 3907 posts Report Reply

  • stephen walker, in reply to Russell Brown,

    that blog post is six days old. why haven't Auckland Councilors put up a resolution demanding that ACIL and POAL comply with their obligation under the Local Government Act 2002? the only sacking that needs to be done is by Auckland Council of non-complying ACIL directors.

    tokyo • Since Nov 2006 • 628 posts Report Reply

  • Sofie Bribiesca, in reply to DeepRed,

    Attachment

    Thanks for that link. A petition is there if anyone is interested. A piece of my Auckland heart breaks off every day and I will blame this Government and it's ways. Is the protest up Q street this weekend?

    here and there. • Since Nov 2007 • 5724 posts Report Reply

  • Ross Mason,

    Well explained. Rich of Understanding

    Upper Hutt • Since Jun 2007 • 1459 posts Report Reply

  • nzlemming, in reply to James Butler,

    Gold has no intrinsic use

    It's a bloody good electrical conductor and it doesn't corrode. Which is why computers have enough in them to be worth harvesting when they're junked.

    So it does have intrinsic use. What it doesn't have is intrinsic value

    Edit: Oh snap, Richard Stewart. Read the whole thread, Mark...

    Waikanae • Since Nov 2006 • 1701 posts Report Reply

  • DeepRed, in reply to Sofie Bribiesca,

    Is the protest up Q street this weekend?

    It looks the part. And it looks like a show of global solidarity too.

    The southernmost capital … • Since Nov 2006 • 3907 posts Report Reply

  • DexterX,

    Chocks away here goes.

    Something Len and other Councillors, who are allegedly left (left of centre or who purport to be concerned about the plight of workers and their families) could have done is get Council as a whole to reconsider the decision to ask for 12% and Len could have grown some gonads shown leadership and appealed to both parties POAL and the union to continue to meet in good faith on the basis that POAL don’t lock out or make the workers redundant – until Council reviews the decision – Len could have promoted this approach as being in the wider interests of Auckland and in the National interest to keep the Auckland Port working.

    Len appears to be basically saying, “It is not in my job description” – what a lame cock he has become or always was. What is the defining moment of his mayoralty thus far?

    I am mindful the situation is being dealt out by the same (sort of) people at local and central govt who gave us the RWC opening fiasco and the mammoth super city merger overruns.

    I would like to see some form of opposition be it the press by OIA, Labour, NZ First, Mana or someone investigate and publish the core of the Council decision to ask for the 12% return – was a feasibility study or review done to ensure that this goal was achievable and the what achieving the 12% entailed – what was required to get the return – was it based in reality – did the Council and the Mayor sign off on a default position/direction to POAL of – “How do we get 12%?”, “I don’t know”, “Lets phuck the watersiders”, – “OK good plan” – “Go for it” – “All in Favour?”

    I feel the union has been set up and under what I suspect was the guidance of CTU Prez walked right into it – Helen Kelly and fiasco seem to go hand in hand – the union hasn’t perhaps seen what was really at stake. The union should have played a different game.

    Was the figure of the 12% POAL return requirement pulled out of the same dark murky dung covered recess using the same black ops methods as the pre-election opening the books bullshit statements and the recent Bill English statements – guessing or misguided optimistic outlooks with no foundation.

    I am well tired of general thrust that was NZ under the Lange/Douglas & Bolger Richardson govts where the climate of work and the provision of “public service” was driven generally by management/cabinet expectations that were not founded in reality or had regard to the public interest. A situation where everyone except management types were beaten up to achieve a sub optimal outcome – the over reliance on consultants etc, etc – Yet here we as a nation at this very same place being forced to drink the same old cup of cold sick and it is promoted as a cure – asset sales and all.

    The POAL was working well, the staffs were paid performance bonuses and the operation of the port was by all accounts competitive internationally and a success.

    The economy felt to me like it was showing signs of recovery.

    It is a mindless waste and the reasons advanced for the dispute are IMHO bullshit, bullshit is about to prevail. Another set of terms and condition and something that worked well has gone for good.

    Auckland • Since Nov 2006 • 1157 posts Report Reply

  • Sofie Bribiesca, in reply to DexterX,

    gone for good.

    Mean while Nurses, Caregivers, Meat Workers,and it is suggested Public service,with Police on the horizon.The wharfies are only lucky in that the world's wharfies supports them. As in the states, we will begin to see Tent cities of the working homeless. Contracted out employment is no job security. It can be on a daily basis that you have work. Nek minit... :(

    here and there. • Since Nov 2007 • 5724 posts Report Reply

  • Rob Stowell, in reply to DexterX,

    bullshit is about to prevail

    Yep. Plenty where I work, too. We're in for a tough couple of years. The unions are about the only organised opposition to unfettered free market rule. The Bosses are determined this is their moment. Cult of management, trickle-down bullshit and look carefully at your rights- they might be disappearing.
    As the man said- "Organise!"

    Whakaraupo • Since Nov 2006 • 1354 posts Report Reply

  • DeepRed, in reply to Rob Stowell,

    The Bosses are determined this is their moment. Cult of management, trickle-down bullshit and look carefully at your rights- they might be disappearing.

    To those who get locked out - look no further than the Synovate dispute, where the union cleverly turned a lockout into a bossnapping. Even the pioneering French never figured that out.

    The southernmost capital … • Since Nov 2006 • 3907 posts Report Reply

  • DeepRed,

    And the joint union-business call for what is effectively co-determination, while well-reported on Stuff/Fairfax and 3News, is glaringly absent from the Granny (at least in its online daily edition).

    The southernmost capital … • Since Nov 2006 • 3907 posts Report Reply

  • DexterX, in reply to DeepRed,

    To those who get locked out - look no further than the Synovate dispute

    However - those that have been locked out by POAL have now been made redundant.

    Auckland • Since Nov 2006 • 1157 posts Report Reply

  • merc,

    Consultants against democracy.

    Since Dec 2006 • 2468 posts Report Reply

  • DexterX,

    From the herald - The Auckland Super City via POAL have money to burn - likely near on $20 million - being 8 mill in lost revenue and 11.5 Mill redundancy payouts - never mind the other laudable other funding goals and projects ( the train set) Len wants to pursue.

    But Mr Brown said his hands were tied by legislation and it would be "absolutely inappropriate for me to jump into disputes or run the port out of the mayor's office."

    Showing leadership and taking a wider view to facilitate a solution is "absolutely inappropriate" - could he explain how so with what is at stake.

    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10790557

    http://www.nzherald.co.nz/employment/news/article.cfm?c_id=11&objectid=10790553

    Auckland • Since Nov 2006 • 1157 posts Report Reply

  • merc,

    But Mr Brown said his hands were tied by legislation and it would be "absolutely inappropriate for me to jump into disputes or run the port out of the mayor's office."

    Jump on in Mr Brown , your bosses are,

    Government intervention into commercial markets first came to public attention with the largely opaque deal with Warner Bros studios to secure production for Sir Peter Jackson's The Hobbit, with John Key negotiating industrial law change and a $20 million sweetener, on top of the $100 million subsidy.
    Last year it was revealed the Government had extended a loan so that several radio stations could pay off their payment to the Crown for radio frequencies.

    http://www.nzherald.co.nz/media-publishing-industry/news/article.cfm?c_id=707&objectid=10790533
    Who are your bosses again?

    Since Dec 2006 • 2468 posts Report Reply

  • Sofie Bribiesca, in reply to DexterX,

    I can't find a way to even email Len Brown,other than filling out a form of complaint and they will get back to you next week. I'm going to go down to the rally in Britomart on Saturday and see what the watersiders have to say.

    here and there. • Since Nov 2007 • 5724 posts Report Reply

  • Bart Janssen,

    Hmmm I own a company and install a CEO to manage it.
    Said CEO behaves like a reprehensible neanderthal.
    I a) boot CEO and replace him with a human being
    or b) have lunch

    Auckland • Since Nov 2006 • 3114 posts Report Reply

  • merc,

    I install CEO to cover my butt, then have lunch.

    Since Dec 2006 • 2468 posts Report Reply

  • DeepRed,

    And it seems the redundancy payouts fail economics forever. All $11.5 million of it.

    The southernmost capital … • Since Nov 2006 • 3907 posts Report Reply

  • merc,

    Redundancy delivers more than 12%?

    Since Dec 2006 • 2468 posts Report Reply

  • Russell Brown, in reply to DeepRed,

    And the joint union-business call for what is effectively co-determination, while well-reported on Stuff/Fairfax and 3News, is glaringly absent from the Granny (at least in its online daily edition).

    It's weirdly absent.

    Edit: Ah. The alliance was noted in the Herald on Feb 17. No report on the drafting of the charter this week though.

    Auckland • Since Nov 2006 • 17967 posts Report Reply

  • DeepRed, in reply to Russell Brown,

    It’s weirdly absent.

    Something for the Granny's three Brians (Rudman, Fallow & Gaynor) to expand upon. Right. Now.

    The southernmost capital … • Since Nov 2006 • 3907 posts Report Reply

  • merc,

    Since Dec 2006 • 2468 posts Report Reply

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