Ron Kitching is the sort of guy it pays to take seriously on economic and business issues, having founded what was in its time one of the largest drilling companies in Australia, Glinderman and Kitching. G&K maintained its leadership by being at the technological cutting edge of innovation in the industry, driven by Ron. He is also the author of one of the best books on free market economics on the market, “Understanding Personal and Economic Liberty.”
Ronny tends to express his disgust with the way things are on some occasions with a cynical humor that really gets the message across. Ron drew my attention to an article in ‘portfolio.com,’ by Michael Lewis, who chronicled the excesses of Wall St in a book, “Liar’s Poker.” It is a long article but worth reading, as the author is a former insider who got out in the late 80s, as he was convinced that it was all going to fall apart long before now.
So here is the take on the subject from the author of “Organic Nuclear Energy,” and “Stock market made easy”: -
Nearly every morning about 6 am I meet all of the old blokes below at the paper shop. Nothing official it's just that we all turn up about that time. We are known as the G8. Most are Labor devotees. But we are all good mates. At our early morning political discussions we make major decisions concerning State, National and World affairs.
I have decided that we should make some money using the models recently used on Wall Street, to finance our activities. Here below, it is formalized. Our efforts would be certainly better than the elected Politicians State and Federal. All good clean fun.
We lease two thousand cows.
We sell three thousand of them to our publicly listed company, using letters of credit opened by The Secretary’s contacts at the Commonwealth Bank, then execute a debt/equity swap with an associated general offer so that we get all four thousand cows back, with a tax exemption for five thousand cows, due to the drought. The milk rights of the six thousand cows are transferred via an intermediary in the Reserve Bank to a Cayman Island Company secretly owned by the majority shareholder who sells the rights to all seven thousand cows back to our listed company.
The annual report states that the company owns eight thousand cows, with an option on one thousand more. We sell one thousand cows to buy a new Premier of Queensland, leaving us with ten thousand cows to finance the activities of the G8. No balance sheet is necessary. The public then buys our bull.
Next year in a public float people will be able to buy shares in our 100,000 strong herd on which we already hold a million options. These funds will be made available to buy the next Prime Minister. We will then restore order.
Our cows are virtual cows and do not eat grass, thus they do not create carbon dioxide. For our unique enterprise, the Australian Government has granted us a billion carbon credits. We will sell tranches of 100,000 for $1,000,000,000 being the derivatives of these credits to the British Government, which is keen on saving the world from the imagined hazards of carbon.
This will go into the Cayman Islands account and will finance future activities. The advantage of our virtual cows is that they do not take up any space so that more land can be made available for National Parks. At a future date the G8 are going to look at reviving the wool and fat lamb industry. So there is plenty to do. G8 Executives are:
Ronald Kitching AAIOB - (Aged And Infirm Old Bloke) President.
Herb Everett. FOPLA - (Fellow Of the People and Lay About.) Treasurer and CEO Aircraft Fleet.
Leslie V. Clarke K A F S. - (Knight of The Australian Fabian Society.) Secretary General.
Ray Hoare WKOCA - (Well Known Old Cow Accumulator.) Stock Curator and Inspector.
Richard Headon OBE - (Over Bloody Eighty.) Office CEO and Senior Auditor.
Rev.Dr.Graham Whitfield BNKS - (Brand New Knees and Shoulder.) V. P. and Machinery Inspector.
Sidney Morton WKOP – (Well Known Old Painter.) Vice President to the Treasurer
Robert Smith AOCM - (A Retired Old Coal Miner.) Assistant to Secretary General