Does the Vanguard Social Index ever beat the market? @EricCrampton @JulieAnneGenter

The performance of social investing is so bad that anyone investing other people’s money and having fiduciary duties to the owners of that money should take legal advice. Over the 16 years charted below, socially responsible investing wiped $4,000 off the initial investment of $10,000. Over a lifetime of saving, that is a big difference to the security of your retirement.

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Source: VFTSX Vanguard FTSE Social Index Inv Fund VFTSX Quote Price News.

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Source: VFTSX Vanguard FTSE Social Index Inv Fund VFTSX Quote Price News.

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#WomensBoatToGaza @MaramaDavidson silent on Hamas rocket attacks

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#GMO the most regulated & tested product in agricultural history

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What do @GreenpeaceNZ, #McDonalds and @Forest_and_Bird no longer have in common?

Like McDonalds, Greenpeace globally is a brand. Forest and Bird is a local conservation brand. Until last year, I was utterly clueless as to who its leaders were. That is a deliberate branding decision in the past by McDonalds.

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Greenpeace New Zealand and Forest and Bird were also pretty faceless in terms of who their chief executives were.This meant people were less likely to conflate the far left backgrounds of its leaders and activist support base with their self appointed environmental do-gooders brands.

No more, no longer. Greenpeace NZ appointed the former leader of the New Zealand Greens as its Chief Executive last year. Forest and Bird now appointed the Green MP who wanted to succeed him as leader of the Greens as their chief executive. Both bring political baggage.

I do not wish Greenpeace well with its anti-growth, anti-science, anti-human agenda, so I hope this was a mistake they made last year. I hope I am not interrupting them in making that mistake. Forest and Bird appears to be antigrowth as well so let them make this mistake as well.

How steep is @SteffanBrowning’s anti-science slippery slope?

If the Auckland Council can ban the release of GMOs, can it ban the growing of marijuana for recreational and medical uses? Where does it stop? Green MPs such as Steffan Browning should think more deeply about that before they embrace local democracy in all its fury.

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More on homelessness fell under @NZNationalParty? @CarmelSepuloni @cjsbishop

I cherry picked my previous data on homelessness if the New Zealand sub-Reddit is to be believed and from which I am banned and cannot reply. Plotting the data in full is to cherry pick it. The chart below is simply the first two rows of the source data. The subsequent rows deal with those in emergency accommodation and in temporary accommodation.

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Source: 24 August 2016, Most homeless people working or studying, News, University of Otago, New Zealand, table 4.

When I shared this data on Carmel Sepuloni MP’s Facebook page, she rightly and constructively said

Thanks for your comment Jim. Unfortunately the number living rough has increased since 2001. We want to focus on improving the future, which is why we are holding our homeless inquiries so we can best understand and address this issue:

Rather than pointscoring, the issue is what to do to fix the problem. How desperate is much of the rest of the Left to beat up this issue as the fault of John Key. This is an an important issue that should not be used for point scoring by sufferers of John Key derangement syndrome.

Homeless people are those who I charted above. They are sleeping rough or in a car. They have slipped through the social safety net which is obviously not working for them. If you are in emergency accommodation, the social safety net is working. The issue is making that safety net work better in terms of moving quickly into more permanent accommodation..

How will @nzlabour @NZGreens ration their 100,000 affordable homes?

The Labour Party (and Greens) both plan to build 100,000 affordable homes and sell them within a specific price range. In Auckland, where houses cost in excess of $800,000 on average, they hope to enter the market at the $550,000 point with still quite reasonable housing.

What I ask you is how will Labour and the Greens make sure the affordable houses both are proposing are not snapped up by well-to-do buyers rather than families currently locked out of the market? What will the rationing mechanism be?

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Source: KiwiBuild – New Zealand Labour Party.

How will Labour  and the Greens ration these desirable houses given that they are priced well below the competition? If two buyers both offer $550,000 for the house, which bid will be accepted?

If the next best available house in Auckland is worth more than that because it is not sold by the proposed Housing Affordability Authority, the first bid for these houses will be $550,000 which is the maximum the government under a Labour Party is willing to accept? What happens then? 

It is basic economics that if you price at less than the market clearing rate which in Auckland is somewhere near $800,000, people will queue to buy what you have unless you raise the price. The exercise of building 100,000 affordable houses makes no sense unless the purpose is to undercut what the market currently supplies.

As the houses are to be sold by a government agency, there can be no black market nor dilution of quality to even up supply with demand. How will a deadlock in price bids be resolved if the maximum bid for an affordable house starts at $550,000?

Labour acknowledges the possibility of flipping by restricting resale for 5 years. But what stops investors just waiting 5 years as there is any significant price gap between these affordable houses and the private market alternatives.

What stops more affluent buyers living in these houses because they so much cheaper than the competing options in Auckland? If you miss out in bidding on one affordable home, do you go back to the end of the queue for the next that is built or get some priority?

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.@NZGreens do not understand business: minimum wage for contractors version

The Greens are most upset that a Labour party private members bill to specify a minimum wage for contractors was voted down by one vote in parliament yesterday.

If you earn than the minimum wage as a contractor, that is a signal wrapped in an incentive. Your poor hourly earnings is a signal to you that maybe you should get out of that contracting business and go back to being an employee where you will be paid at least the minimum wage.

Many small businesses make no profits at all in the first year or so as they build the business. The founders of the business get by on savings, which they anticipated when they drew up their business plan. No one expects a business to make an immediate profit or always be profitable.

Contractors are entrepreneurs chancing their arm. They need crisp signals about whether they are succeeding, failing or could succeed if they try harder or do something different. A minimum wage for contractors masks those important market signals of success and failure.

If your dream of owning your own business is not even paying the minimum wage, maybe it is time to get out of the contracting business.

Just how anti-science are the Australian @Greens?

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Source: Denying Problems When We Don’t Like the Solutions | Duke Today

I am not sure that the Australian Greens earn brownie points for referring to the scientific consensus on global warming as follows

Current global climate change is primarily caused by human activities contributing to increased concentrations of greenhouse gases in the atmosphere, and is already contributing to disruption of human societies through sea level rise, extreme weather events, desertification, harm to health, wellbeing and other effects. This is the overwhelming consensus of the international scientific community.

The Greens then give their opponents a free kick regarding their views on coal:and their commitment to science-based risk policy:

No new coal-fired power stations or coal mines, and no expansions to any existing power stations or mines, plus the development of programs to assist coal-dependent communities to make the transition to other more sustainable sources of economic prosperity.

There is no attempt to refer to science to justify this blanket prohibition against a specific energy source.

The views of the Australian Greens is no more science based on atomic energy:

    1. The world should be free of nuclear weapons and the nuclear fuel chain.
    2. There is a strong link between the mining and export of uranium and nuclear weapons proliferation.
    3. The use of nuclear weapons, nuclear accidents or attacks on reactors pose unacceptable risk of catastrophic consequences.
    4. Future generations must not be burdened with dangerous levels of radioactive waste.
    5. Nuclear power is not a safe, clean, timely, economic or practical solution to reducing global greenhouse gas emissions.

If there is any basis in science with this blanket opposition, I am sure the Australian Greens might have mentioned it.

Do the Australian Greens refer to the scientific consensus on GMOs in their policy platform as a helpful reminder or is there just have an ever rising demand for more evidence

    1. Genetically modified organisms (GMOs), their products, and the chemicals used to manage them may pose significant risks to natural and agricultural ecosystems.
    2. GMOs have not been proven safe to human health.
    3. Scientific evidence produced independently from the developers and proponents of the GMO must be undertaken and form the basis for assessing and licensing of GMOs. GMO assessments must be broad, independent and scientifically robust.
    4. The precautionary principle must be applied to the production and use of GMOs.

Unlike the New Zealand Greens, at least they do not simply reject the possibility of GMOs, the Australian Greens prefer the tactic of never being satisfied by the evidence.

The only thing I can find on the position of the Greens on fluoridation and vaccines is from a Victorian upper house MP who is half sensible on these issues. On fluoridation she says on behalf of the Greens

The Greens policy is quite clear on this. We do not have a policy for or against fluoride. Our policy supports the right of communities to determine the introduction of fluoride into local water supplies.

Not expressing the opinion on the wisdom of not putting fluoride in local water supply hardly shows a strong commitment to science-based public health policy.

On vaccines, this Victorian upper house green MP is not too bad at all:

I want to begin by stating that the Greens join health and scientific experts in absolutely supporting vaccination as a safe, proven and critical preventative health measure. The elimination of horrific diseases such as polio in Australia is testament to the incredible effectiveness and importance of vaccines…

There is also a group of people who might be called ‘hesitators’. They are not strongly opposed to vaccination, but they have heard that there might be some risks and they are thus unsure about them. These people do not perceive a strong risk of their child contracting any of the horrible diseases that immunisation prevents, so they think that on balance it might be reasonable not to vaccinate or to delay vaccination until their child is older or they simply have not yet made a decision either way. Hesitating parents may not realise that in some areas the local vaccination rate is getting well below safe levels and thus the risk of an outbreak is increasing.

This is far better than her New Zealand counterparts who do not seem to have an opinion on this vital public health issue. Indeed, the New South Wales Greens moved in the state parliament to tighten up a bill on exemptions from vaccinations.

Changes to the NSW Public Health Act in 2013 prohibited unvaccinated children from attending childcare unless their parents held “a personal, philosophical, religious or medical belief involving a conviction that vaccination under the National Immunisation Program should not take place” and they had discussed the matter with their GP”. The NSW Greens moved an amendment to remove personal, philosophical and religious beliefs as a grounds for exemption. This is one of the few times I can say something nice about a green MP.

Many on the right have their doubts about climate change science, much of which is actually delivered driven by solution aversion.They do not like the costs of the solution so they attack the rationale for it for tactical reasons. Cass Sunstein explains:

It is often said that people who don’t want to solve the problem of climate change reject the underlying science, and hence don’t think there’s any problem to solve. But consider a different possibility: Because they reject the proposed solution, they dismiss the science. If this is right, our whole picture of the politics of climate change is off.

The Left picks and chooses which scientific consensus as it accepts. The overwhelming consensus among researchers is biotech crops are safe for humans and the environment. This is a conclusion that is rejected by the very environmentalist organisations that loudly insist on the policy relevance of the scientific consensus on global warming.

What is worse is this rejection of science is not based on solution aversion; that the costs are high. It is a plain rejection of science on principle by the green left rather than for tactical reasons such as by the right on global warming.

What is more worrying is all the science that is rejected by the left will make us more prosperous. Only when the solutions make is poorer does the green left support them such as with global warming and carbon taxes.

In many ways what divides the left and right onn science is a question of values: the value placed on progress, on the Great Enrichment, on the Great Fact and on the Great Escape.

The Greens are no more than a reincarnation of the 19th century British Tory Radicals with their aristocratic sensibilities that combined strong support for centralised power with a paternalistic concern for the plight of the poor:

  • 19th century Tory radicals opposed the middle classes and the aesthetic ugliness they associated with an industrial economy; and
  • Like the 19th century Tory Radicals, today’s green gentry see the untamed middle classes as the true enemy.

Many Greens think they are expressing an entirely new and progressive philosophy as they mouthed the same prejudices as Trollope’s 19th century Tory squires; attacking any further expansion of industry and commerce as impossibly vulgar, because it was

ecologically unfair to their pheasants and wild ducks.

Neither the failure of the environmental apocalypse to arrive nor the steady improvement in environmental conditions because of capitalism has dampened the ardour of those well-off enough to be eager to make hair-shirts for others to wear.

True to its 1960s origins, environmentalism is a mix of bureaucrats and hippies: a global, little-brother government that keeps the lower classes in line and a back-to-the-earth localism imposed on others but presenting no real threat to the inner city green elites’ comfortable middle class lives.

Where will land come from 4 @NZGreens housing plan? @GarethMP

The Greens are at it again proposing to build 100,000 affordable houses without ever explaining where the additional new land will come from.

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There would have to be an amendment to the proposed Auckland unitary plan to free up more land for there to be a net increase in the supply of land in Auckland.

Unless there is that such amendment, a government plan to build 100,000 affordable houses in Auckland and elsewhere will simply be competing for the same fixed supply of land. If the supply of land is constrained from expanding by much, the only thing that will happen is that the price will go up with more money chasing the same amount of land and housing.

Just how anti-science are the @NZGreens?

One out of four for accepting the consensus position in the sciences of climate change, GMOs, vaccines and fluoridation. A rather disappointing scoreboard for the New Zealand Greens.

Let us start with the good: the position on climate science from the Greens policy platform:

We must act according to credible science on climate change, which demands urgent action to reduce greenhouse gas emissions as soon as possible, and sustained action to safely remove excess greenhouse gas from the atmosphere.

Let us move on to the bad which is GMOs, quoting from their platform

The Green Party believes that Genetic engineering should occur within a contained laboratory setting only. Our food and our environment must be kept GE Free. To this end, the Green Party will:

  1. Ban the commercial release and field trials of GE organisms.

  2. Prohibit field-testing or production of GE foods within New Zealand.

  3. Work towards a ban on GE food imports.

  4. Require safety testing for any imported GE food or commodity that is allowed to enter the New Zealand food supply.

  5. Allow gene technology in secure containment to continue to be used subject to assessment by the Environmental Risk Management Agency.

Now let us move on to the ugly which is vaccinations, again quoting from their platform, which is not to mention it at all. Greens health spokesman Kevin Hague said

Our official position is influenced by the fact that we do not have a firm policy on it as we don’t have consensus from our members. However there are some key points on which we all do agree;

  1. Immunisation is an individual medical choice, and should never be mandatory. Nor should it be promoted in a way that makes people feel pressured into being immunised, or immunising their children.
  2. Parents should have access to impartial information which provides them with information about the risks and benefits of immunisation, so that all individuals (and parents in the case of children) can make an informed decision about immunisation.
  3. Parents should not be penalised for not immunising their children, nor should there be incentive payments or rewards or access to other goods and services, or any linking of immunisation to benefit entitlement.
  4. Some parents will choose to have their child immunised against some diseases, but not others. No parents should be forced to make a decision between their child having all immunisations or having none.

That strike two so now let us move on to the decidedly ugly which is fluoridation

The presumption that parents know the best interests of their children requires very strong evidence before it is overturned. Of course, you do not have too tolerate their unvaccinated children coming to school to infect your children. It is another thing for the Green Party of New Zealand to see both sides of the fluoridation argument:

C. Fluoridation of Community Water Supplies

The issue of fluoridating community water supplies requires a difficult balance between the public health effects and the rights of individuals to opt out altogether or avoid excessive intake. The Party membership has indicated that when considering fluoridation proposals, the Green Party caucus shall:

  • Have particular regard to the public health benefits of fluoridated community water supplies.
  • Have particular regard to the potential public health risks of excessive fluoride consumption via community water supplies.
  • Have regard for the ability of individuals to opt out.

The Green Party will:

  1. Support the use of ‘opt-out’ options by local authorities for residents living in areas with fluoridated public water supplies, where shown to be feasible.
  2. Commission an independent study on the impacts of fluoridation to public health.
  3. Support education initiatives to advise caregivers of the potential for babies to develop dental fluorosis when mixing formula with fluoridated water

Green Party of the New Zealand – health policy.

One out of four is not good enough considering how prissy this Greens are about scientific consensus on climate change.

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@metiria house prices won’t drop 40% by raising taxes, banning foreigners

Just increase the supply of land. Extending the capital gains tax and banning foreigners from buying land will do no good. An average house price 10 times the average income in Auckland is not a demand-side problem.

Source: Is Your Town Building Enough Housing? – Trulia’s Blog.

There are plenty of examples of US cities with different land supply restrictions but common national surges in demand for housing such as prior to the GFC. Cities with liberal land supply experienced only small increases in house prices.

Source: Regionally, Housing Rebound Depends on Jobs, Local Supply Tightness – The Long-Awaited Housing Recovery – 2013 Annual Report – Dallas Fed from Federal Housing Finance Agency; Bureau of Economic Analysis; “The Geographic Determinants of Housing Supply,” by Albert Saiz, Quarterly Journal of Economics, vol. 125, no. 3, 2010, pp. 1253–96.

The Greens should follow ACT and the Labour Party in calling for the abolition of the Auckland urban limit and changes in council finances so they can fund the necessary infrastructure quickly.

Yes Prime Minister on a minister of manufacturing @jamespeshaw @julieannegenter