And now Hanover Finance, New Zealand’s third largest finance company, teeters on the brink of extinction.
The company has basically given the finger to its 16,5000 investors although Hanover likes to call it freezing their assets to reassess the situation. Either way investors can’t get their money and there’s no guarantee there’ll get all of it back either.
Hanover refused to allow investors, naturally concerned by the finance sector meltdown, to take their money out early. Indeed as late as last week Hanover was assuring investors that everything was just peachy.
Unless Rich List co-owners Eric Watson and Mark Hotchin (presently building a modest $30 million mansion to go with his other lavish properties) are prepared to put up funds - which isn't likely - the best bet for investors is that the company be forced into receivership.
After all, can all the mum and dad investors really trust Hanover to sort out the mess, given they are the same people that lent the shambolic Dave Henderson some $70 million for his absurd Queenstown village project?
Yes, Dave Henderson is involved in yet another finance company mess = in fact, he's responsible for some of the mess.
Yes, those amazing free market flyers have hit the ground with a thud – but it’ll be their unfortunate passengers who will be counting the cost.
What has emerged – is that beaneath the glossy magazine advertisements and the prime time television commercials – the finance sector has been engaged in little more than high flying speculation. It’s proved to absurdly wasteful and not sustainable.
The present meltdown – here and around the world –underlines dear old Karl Marx's analysis of capitalism as a system that works blindly, behind the backs of society and without conscious human control.