You’ve probably had enough of our ranting and raving about Australia’s retirement system this week. So let’s take a look at international news. That’s always morbidly amusing.
When Putin annexed Crimea, he banned all banks operating under Ukrainian law there. Ukrainian billionaire Igor Kolomoisky’s Privatbankdecided to walk away with the deposits of Crimeans. They will have to seek compensation from Russia. But Russia is only promising up to US$20,000 worth.
We’d love to know how many billion Igor absconded with.
Even more bizarre are plans to turn Crimea into a Singaporean like commercial hub. The local economy minister is reading legendary Singaporean leader Lee Kwan Yew’s book on how to do it.
He won’t like what he finds. Russian economic policy isn’t going to gel well with Singaporean style free markets. At least they’ll agree on policy outside of economics…
By the sounds of it, Crimea could turn into something like China’s special economic zones. It’s obviously fan-tabby-tastic that the Russians don’t want to import their own bureaucratic nightmare of a government.
But consider us sceptical. Any free market zone that lives by the leave of a government isn’t free. It’s a playground for the rich and the corrupt.
Up north, Ukrainian government forces suffered their worst losses since their latest campaign into eastern Ukraine began. 16 soldiers died in a checkpoint attack. The Ukrainian story is far from over.
The Western European economy is much more promising these days. The Italians have come up with a far more ingenious way to improve their debt to GDP levels than any other country in the world so far. The plan is to include cocaine sales and prostitution in economic put out…errr output.
Best of all, nobody really knows what the value of either is, letting economists draw their lines unnaturally high and make indecent proposals when it comes to the figures.
‘Even if the impact is hard to quantify, it’s obvious it will have a positive impact on GDP,’ said Giuseppe Di Taranto, economist and professor of financial history at Rome’s Luiss University.
No doubt the Keynesians are rather excited. With whoring and snorting added to the list of viable economic stimulus, who knows what the next stimulus package might be hiding?
Kevin Rudd and Craig Thompson will reportedly be joining Silvio Berlusconi to head up a panel to answer just that question.
for The Daily Reckoning Australia