PO Box 2 Blackball

Paul Maunder's blog


John Key

On not meeting Barack Obama

I saw a French film a long time ago about the Sun King, Louis XIV, also known as Louis the God-Given or Louis the Great. There was a scene of Louis as a child being told sternly to never touch his face. The incident has stayed with me. Here was a boy and then a man who never touched his face in public. Touching of the face is usually a childish act of reassurance, to make contact with the oral centre. A king doesn’t require reassurance. There would be other behavioural matters of speech, dress and so on, and to be king required Louis to learn this public image.

Obama became, and remains, a public image, that of the first Afro-American (albeit a recent migrant) to become president. This required him to be extra presidential, to stay calm, to never, no matter what the provocation, no matter what the failures, to show grief or anger. And the provocations and the failures were huge: Netanyahu humiliating him, the Republicans refusing to be reasonable, Palestine remaining a mess, Guantanamo not closing, having to bail out the bankers rather than the mortgagees, Syria erupting, Afghanistan remaining problematic, Medicare scraping through in diluted form, gun control failing… And he killed a lot of people through drone strikes and expelled more illegal immigrants than his predecessor. But he stayed cool. He never touched his face. He was obedient to the system. (His successor, Trump, is a disobedient lunatic, losing the plot on every occasion.)

Now Obama has become a charismatic figure. He can’t speak about politics or judge his replacement. Instead, he has become royalty, above it all.  The playing of golf by these leaders, is, it is reported, a chance to escape the immediate presence of their security people, who, given the spaciousness of the golf course, have to resort to hanging out in trees and other possible places of concealment.

Obama and John Key seem to genuinely get on. They were both brought up by their mothers and both have a migrant parent. John Key as well, never got angry or sad, never touched his face as it were. He’d learned not to need reassurance. Obama has written two books and is a literate man. Both books are explorations of the migrant child. In the first he searches for his Kenyan father and details the struggles of the white solo mother with a coloured child. The other book is a study of senate politics and I was impressed by the migrant boy’s willingness to learn the ropes and play the game. Key’s mother was a Jewish refugee and he in turn learned to play the broker game, then the political game. I suspect that neither, in fact, had a particular ideology to push, neither had  a passion. They suspected such extremity. Obama, as writer, enjoyed the oratorical and oratory plays a role in US politics far more than it does in NZ. Key never indulged in verbal flights of fancy.

But having done their stint they now stand, like royalty, above the fray. Earning big bucks is easy: $400,000 an appearance for the orator; the broker can sit on boards. Not touching the face has its rewards.

It’s interesting to compare this with the experience of the Cuban revolutionaries who earned their mana though fighting in the mountains, through long marches in rain and mud, tormented by mosquitoes and asthma, depending on the peasantry for a meagre diet, wounded and exhausted but finally victorious, driven by anger and grief at injustice. Touching the face was not an issue. Liberty or death was the issue.

Royalty disdains such melodrama.

Becoming Teflon John

They say about John Key that nothing sticks, and he looks set to become a long serving prime minister, with the opposition unable to damage his standing, or find the wedge that splits open the political middle ground.

The biography on Key produced before the last election was an informative read. We know the basic story: single Mum working at nights, state house, mediocre school student with the ambition to be prime minister, wanting to study economics but Mum saying accountancy was a better option career-wise; and the young graduate, who can’t remember noticing that great ethical battleground, the 1981 Springbok Tour, then seeing a TV documentary on currency trading and saying to himself, That’s what I want to do.

So, what does a currency trader do? The Foreign Exchange market (FX for short) exists ‘to facilitate the exchange of one currency for another’. [1] It’s necessary for multinational companies ‘who need to pay wages in different countries, buy and sell between countries and for mergers and acquisitions.’ It also means we can go on holidays in different climes and change our money at the airport. But this practical use is only 20% of the market volume. The other 80% of trading is speculative, to put it bluntly, gambling by large financial institutions and wealthy individuals, ‘who want to express an opinion on the economic and geopolitical events of the day.’ Right now, they might want to hasten the downfall of Venezuela for instance, or influence the UK referendum on whether to belong or not to the European Union.

All currency trades exist simply as computer entries. Trading involves betting one currency against another. If I think the NZ dollar will increase in value against the Aussie dollar I buy NZ dollars with Aussie dollars and after 24 hours, during which I hope the rate will have increased, I buy Aussie dollars with my NZ dollars. If the rate has increased by 1 cent in the dollar and I have risked 1 million dollars I’ve made 10,000 in a day. You can also put a forward date on the transaction, say a month’s time. If in the meantime, an election is occurring, or a budget, that would up the stakes.

Currency traders play middle men, buying the million kiwi dollars at a rate acceptable to the seller and then, in turn, buying the Aussie dollars. If there’s a differential of .2 cents, they’ve still made a couple of thousand. They’ll win some and lose some, but over a week, they’ll be wanting to make a profit. Of course, there’s research to help: past movements of the currencies and ‘fundamentals’ to take note of, namely ‘the likely effect of economic, social and political events on currency prices’.  It’s a risky business but huge gains are possible. George Soros reputedly made a billion dollars in one day. There are no rules or regulations and it is the largest financial market on earth, 3.2 trillion dollars being exchanged daily. It’s a global poker game for the wealthy.

John was good at it. Like a poker player you’d have to have confidence, an ability to read the opponent and ways of coping with stress.  Some dealers, in order to relax, opt for the high life: sniffing cocaine and taking a call girl to Acapulco for the weekend; but John married his childhood sweetheart, had a couple of kids and saved his money until he had a nest egg which would see him through.

Now for his boyhood ambition, to be PM. He’d been at the heart of the beast, accepted that that’s how the world works (a poker game for the rich) – of course, there’s other stuff going on, droughts, plagues, wars, Springbok Tours, poverty, but they’re not really important, other than their effect on currencies. I mean, don’t sweat them. When you get to be PM, watch out for the fundamentals and past movements. There’ll be colleagues who get tempted by the high life, just rein them in or get rid of them. It’s sort of fun being with celebs and being one. The opposition’s stuck in some time warp worrying about injustice and beggars and people sleeping in cars and stuff, but it’s not actually relevant – the FX is where it’s happening and people know that. Life’s a poker game, a celeb game, everyone wants to be wealthy enough to not have to worry. And they’re all waiting for the chance, waiting for the button to push. Apartheid went away didn’t it? Making a song and dance didn’t do much. The exchange rate did them in. The wealthy said, Whoa boys, it’s not working any longer. So stop the ethical sweating. It’s a waste of energy.

Of course, as PM you have to take notice of what people are thinking. For that, you’ve got the polling. If they’re really against something, got some bee in their bonnet, well, don’t do it. Doesn’t matter. Win some, lose some. Don’t get into a sweat at the occasional loss. Just keep on eye on the fundamentals. And know that incremental change is worthwhile – the FX operates to the fourth decimal point.

And everyone agrees, really. Is Labour against the FX? Nah. The Greens? Nah. So what are they on about? Trying to sweat the little stuff – workplace laws, environment – stuff like that. Of course, as you move around you do see some shit that makes you think. Syria, ISIS, people who’ve lost the plot, gone sort of primitive, dog eat dog, blood and guts. What war must have been like. Before drones. But the FX’ll sort it out. I mean, it’s dog eat dog, but doesn’t involve fists or rocket launchers. It’s civilised. The only problem is if someone starts attacking that. This Sanders bloke is a bit of a worry, but he’ll go away. Thank God we haven’t got anyone like him in this country.

Right, got to get on the plane again. My daughter’s got a graduation in Paris. Better head off for the weekend. You know, if you’re really smart, you can create a bit of a dynasty. Not bad for a kid from a state house.


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