Published Date: 23 June 2008
Stagflation takes first bite
“The flaws inherent in our out-dated debt-based financial system have been exposed as stagflation impacts on New Zealand’s small, vulnerable economy. The combination of inflation with economic stagnation has already taken its first bite” said DSC Leader, Stephnie de Ruyter, “and looks set to make a meal of us”.
“As food, oil and electricity prices continue to rise, incomes and profits are shrinking, leaving ordinary New Zealanders struggling to feed their families and meet their financial commitments.
“The folly of the Reserve Bank’s legislative target of price stability (i.e. control of inflation) is all too real. The focus is too narrow to be effective in managing the difficult conditions New Zealand faces, but is symptomatic of the blind faith in neo-liberal globalisation which typifies successive governments’ monetary policies.
“As economic conditions deteriorate, the Reserve Bank will be powerless to act appropriately. And New Zealanders will suffer the consequences.
“Is the situation really that dire? The Royal Bank of Scotland certainly believes so. It today advised clients ‘to brace for a fully fledged crash in the global stock and credit markets over the next three months’. The bank’s credit strategist, Bob Janjuah, said ‘a very nasty period is soon to be upon us – be prepared’.”
Ms de Ruyter noted that New Zealand has a real and present opportunity to step away from the impending global meltdown.
“There is an ethical alternative to the failing system: a social credit economy which serves of all New Zealanders. The solution is at hand. All that is lacking is the political will to deliver it. The time is right for orthodox economics to be replaced by social credit monetary reform” Ms de Ruyter concluded.
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