Tuesday's Top 10 with NZ Mint: Do we really need pensions reform?; America's rotten corporate heart; Fake gold stress; Dilbert

Here are my Top 10 links from around the Internet at 10 past 12 pm, brought to you in association with New Zealand Mint for your reading pleasure.

I welcome your additions and comments below, or please send suggestions for Wednesday's Top 10 at 10 via email to bernard.hickey@interest.co.nz.

I'll pop any surplus suggestions I get into the comment stream under the Top 10.

1. Doe we really need to change our pensions system? - Peter Harris thinks not at Policy Progress.

My (admittedly sketchy) understanding of the Treasury model that reaches such conclusions is that it derives GDP growth trend changes through a projection of hours worked and an assumed rate of productivity growth. If that is wrong, I make no apology. My point is that if the public is being asked to buy into major shifts in (effective and efficient!) fundamental life cycle income supports, it should be based on more than “trust Treasury”.

A fifty year projection of trends is not just heroic, its nuts. Think back fifty years. Ignoring the EU, globalisation, China etc etc, consider just two technological changes that impacted trends since then: the pill and the computer. They fundamentally shifted birth and labour force participation rates and productivity. Policy based on projections of 1960s demographic, participation and productivity trends would have produced a (with hindsight) laughable prescription.

Even now, labour force participation rates for the 65+ age group show a steeply rising trend. We need a better understanding and more effective monitoring of factors that are driving the tax base, and changes in the demographic structure might well be one such. But it is manifestly not the only one, and almost certainly not the most important one.

2. If you thought I was bearish - Check this out from Egon von Greyerz at Zerohedge  HT Matt via email

Without this massive increase in debt, the US would probably have had negative growth for most of the last 39 years. Total US debt to GDP is now 380% and is likely to escalate substantially. The coming hyperinflationary depression and the credit and asset implosion that is likely to follow will most probably lead to the end of a 200 year era of growth for the Western world.

If only the excesses from the 1970s were corrected we might have a circa 20 year decline. But more likely we will correct the era all the way back from the industrial revolution in the 18th century and this could take 100 years or more. So after the tumultuous and very painful times that we are likely to experience in the next few years, the West will have a sustained period of decline. All the excesses in the economy and in society must be unwound.

3. The new face of Chinese protest - The New York Times has an interesting piece on white collar protesters in China.

A few days after the Agricultural Bank went public, dozens of former bank employees stealthily gathered outside the headquarters of the country’s central bank. There, after distributing small Chinese flags, they quickly pulled on red and blue T-shirts that read, “Protect the Rights of Downsized Bank Workers.”

By the time they had unfurled their protest banners, the game was over. Within minutes, a flock of police officers had swept everyone into five waiting public buses. By 8 a.m., when the People’s Bank of China opened its doors for business, the only sign of the rally was a strand of police tape.

During the past two years, these unlikely agitators — conservatively attired but fiercely determined — have staged similar public protests in Beijing and provincial cities. They have stormed branch offices to mount sit-ins. A few of the more foolhardy have met at Tiananmen Square to distribute fliers before plainclothes police officers snatched them away.

4. 'High levels of stress' - Emirates 24/7 reports that several tons of gold imported into the UAE from Ghana weren't really gold... HT Gertraud via email

Several tons of gold imported into the UAE by traders and investors turned out to be fake on closer inspection, resulting in millions of dirhams in losses and high levels of stress to the victims.

Speaking to Emirates 24|7, Mohamad Shakarchi,, Managing Director of Emirates Gold, said: "A lot of people in the UAE who tried to import gold at lower prices or through dubious overseas companies have been cheated. We have inspected many consignments from African countries, especially Ghana, and found that there is not an ounce of gold in them.

For importing pure dust or other metals with yellow colour, these traders have paid several million dirhams.”

5. Maybe the bust has started - Property sales in Shanghai, Nanjing and Hangzhou have halved in the first six months of the year, while those in Beijing dropped 40 percent, China Daily reports. HT Reece via email.

6. Ho ho ho - The boss of ASIC in Australia, Graeme Samuel, has lost A$50 million of his personal fortune because a company has failed, the Australian reports. Schadenfreude alert. HT Gareth via IM.

The DFO discount shopping-centre empire is teetering on the brink of insolvency andt he chairman of the Australian Competition & Consumer Commission, whose interest in the DFO holding company Austexx is held in a blind trust, said yesterday he had only discovered the full extent of the group's problems in recent weeks.

"This is most distressing indeed because it affects the interests of my children and grandchildren as beneficiaries of my estate," Mr Samuel told The Australian yesterday. Asked if the Austexx shareholding was his family's most valuable asset, he said: "There's no question about that." Mr Samuel was an executive director of the investment bank Hill Samuel, which became Macquarie Bank.

7. The mad thrashing about goes on - The Fed's impotence is causing people to ask all sorts of dumb questions such as: Could the Fed buy stocks instead. Here's FTAlphaville with the details of what one investment bank (that was licking its lips) has written.

Bank of America Merrill Lynch’s Michael S. Hanson and Ethan S. Harris are on hand to answer all your lingering questions. Including, err, why the Fed can’t just go ahead and buy up the US stock market.

8. Here's why America's current version of big corporate capitalism is buggered - Read this report from Joe Nocera at the New York Times to see the problem with 'star' CEOs like HP's Mark Hurd and the mad shortermism of much of listed corporate America.

Charles House, a former longtime H.P. engineer who now runs a research program at Stanford University, openly rejoiced when he heard that Mr. Hurd was leaving. “I think the sexual harassment charge was a total red herring,” Mr. House told me. He didn’t care. “I was delighted,” he said. Mr. House’s brief against Mr. Hurd went well beyond his outsize compensation and penchant for cost-cutting. As Mr. House saw it — indeed, as many H.P. old-timers saw it — Mr. Hurd was systematically destroying what had always made H.P. great.

The way H.P. made its numbers, Mr. House said, was not just cutting any old costs, but by “chopping R.&D.,” which had always been sacred at H.P. The research and development budget used to be 9 percent of revenue, Mr. House told me; now it was closer to 2 percent. “In the personal computer group, it is seven-tenths of 1 percent,” he added. “That’s why H.P. had no response to the iPad.”

9. Mass delusion American Style - Burning Platform does its thing. This is how many Americans think now. There is a growing mood of rebellion there. Worth watching.

The crony capitalists, Wall Street oligarchs, and corporate fascists who control the puppet strings in this country have benefited greatly from the Big Lie. Over 5 million manufacturing jobs have been off-shored since 2000. These good paying jobs are never coming back. Millions of service sector jobs continue to be shipped overseas.

The global conglomerates like GE, HP, Oracle, IBM, and Boeing continue to rake in billions of profits, distributing millions to its high paid executives, while gutting middle class America. The ruling oligarchs convinced Americans to take advantage of cheap goods and easy credit, to buy electronics, cars, appliances, new kitchens, and take the vacations of their dreams.

This Big Lie has left the American consumer with $2.5 trillion of non-mortgage debt and the lowest level of home equity in history. Retailers like Wal-Mart, Target, Home Depot, and Best Buy reaped billions in profits as Americans whipped out one of their 10 credit cards to buy HDTV’s, economy bags of tube socks, iPads, iPods, stainless steel refrigerators, and Dell computers. Small town America’s mom and pop economy was gutted by Big Box retailers selling the globalization delusion. The biggest beneficiaries of the globalization delusion were the Wall Street banks.

They control 80% of credit card market and have reaped billions in interest at rates exceeding 20%, while sucking $20 billion per year in late fees from the clueless public. Wall Street bankers have rewarded themselves for their brilliance in destroying the middle class by reaping multi-million dollar bonus packages.

10. Totally relevant video - Jon Stewart muses on how extending the Bush tax cuts "will strengthen the deficit monster that's going to eat our babies."