Monday, 11 May 2009


Cactus has the flu. That means she has had an awful lot of time to think over the weekend and as a result she has picked the wings of the fly that is NZX and she has done it with academic precision and elegance. If we were NZX we would send Cactus some tamiflu anti viral and some flu vaccine so she doesn't get the chance to think too much again. Or they could just send her a few cases of Krug and a decent shag or two. Otherwise the Barbed Barbie is going to keep on their case until there is some action.

Its a mammoth read - but the guts of it is as follows.

Executive Summary

1. NZX is privy because of their Regulatory position to information that makes them a trusted source.
2. NZX charges for dissemination of this information to the marketplace and generates 45% of its operating revenue in this fashion.
3. NZX is spreading its Regulatory role of a trusted source collector and disseminator of this information into commercial publications it is planning to purchase.
4. NZX has had no permanent Head of Supervision for a year and it is arguable that this person is truly independent anyway.
5. NZX claims that its Supervisory and Commercial operations are "quarantined".
6. NZX Supervisory staff have been financed into an employee share scheme. The NZX CEO is according to the latest accounts, the third largest shareholder in the company and has a sole financial incentive to increase the earnings per share to receive more shareholding.
7. The Securities Commission has previously raised issues of conflict with respect to NZX.
8. The Securities Commission is over stretched and under resourced, more so due to recent finance company issues.
9. The Securities Commission has called internationally for
"independent, strengthened, and well-funded regulators for implementation at the domestic level" due to recent subprime crisis issues.
10. The NZX CEO has a new politicised role and is seen by political advisors as having large influence on John Key.

We reckon Cactus is on the money. As she tends to be. We wait with interest the response from the MSM.

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