Spooky how quiet things are... must be a long weekend somewhere.

#2: I would like to see a version of that graph with public debt replaced by total debt.

Ooooh maybe now is the time to contact Kiwibank with RT's proposal that they open an estate agency....
Just a fee. not percentage based.....

AP has a comment,

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/709581...

"A few European nations are exhibiting dangerous weaknesses. That could have fatal consequences for all countries in the eurozone" (Minister Rainer Brüderle)

"Adding to worries, Moody's has issued an alert on Portugal's "adverse debt dynamics", saying Lisbon needs a "credible plan" to reduce a structural deficit stuck at 7pc of GDP rather than "one-off measures".

"The deeper concern is Spain, where youth unemployment has reached 44pc and the housing bust has a long way to run. Nouriel Roubini "“ the economist known as 'Dr Doom' "“ said Spain is too big to contain. "If Greece goes under that's a problem for the eurozone. If Spain goes under it's a disaster," he said. "

@Steven

Nice idea, until the point where it hits the ground.....then a new 'payment plan' would be devised.

@gow
Have to agree.... why wasn't he commenting on the TWG if he had to speak? Maybe there is a 'Grand Coalition' on this.

I think Mr Key was embarrassed when asked to comment.
Are Labour choosing to throw the next election as a matter of policy?
Maybe Mr Goff has a better job offer?

ummm.... setting up your own real eastate agency may be the next best thing to setting up your own religion.

Spot on, Bill and Sam. NZ is right up there with countries like Iceland and Ireland when it comes to net Private debt.

If our government carries on with its operating deficit and borrowing like it is we will get into the zone of fire eventually.

In the 1980's, NZ governments bit the bullet and spent 20 years paying back the debts accumulated by Kirk/Rowling and Muldoon; especially the 9 years of Muldoon. All that debt had certainly NOT "stimulated" the economy; and I doubt it will "stimulate" economies this time either. We are very much in a time of the blind leading the blind.

But at least last time, people had low mortgage debt, houses were affordable and land was cheap. This time, the very generation that will one day have to pay higher taxes and cope with govt spending cuts (as in the 1980's and 90's) will already themselves be NZ's most privately indebted generation ever. Roger Douglas is right to call what is happening, "fiscal child abuse". We were already in trouble with the sustainability of national superannuation even before any of this happened.

I sold a house in Australia in 2004 and the RE Agent's commission was a standard 2%, much cheaper than here.

veedub states - I sold a house in Australia in 2004 and the RE Agent's commission was a standard 2%, much cheaper than here.

In the UK commissions are usually 1 to 1.5%. When I first came to NZ I was amazed at how high real estate commissions were. Real Estate is now the only business that charges a percentage of the sale price. This practice will also eventually stop in Real Estate when capital gains are no longer the norm.

Andy Rogers and anyone else who is interested: I am getting involved in argument HERE about what are the causes of housing bubbles and unreal capital gains, interrupted by disastrous "busts":

http://www.interest.co.nz/ratesblog/index.php/2010/01/29/rbnzs-bollard-d...

Affiliate Marketing is a performance based sales technique used by companies to expand their reach into the internet at low costs. This commission based program allows affiliate marketers to place ads on their websites or other advertising efforts such as email distribution in exchange for payment of a small commission when a sale results.

www.onlineuniversalwork.com

Morgan Stanley's predictions --

http://www.stuff.co.nz/business/world/3276192/World-stockmarkets-tipped-...

I have never understood why estate agency works on a percentage "“ regardless how small.
Do they work harder to sell the more expensive property?

Please explain.

Commission rates in Vancouver. Bottom line we all have a choice in NZ, if we want to sell privately and pay close to zero fees, we can. If we want to list with an agent, we can. What more can you want???

http://www.ianwatt.ca/RealEstateCommissions

Actually on $500,000 a QLD fee can be a max of approx 2.8% and in NZ around 3.5%. NZ agents will need to provide a level of service, professionalism and results to justify their fee. I stand corrected on my prior comment, my QLD fees paid were a tad cheaper.

Last house I sold was in Jun 2006 and I paid $5k on a $520k house in Auckland, so less than 1%.

No-one actually pays the headline rates they start out with any more than anyone pays sticker on a new car.

You have to compare actual commission rates paid rather than their published rate cards.

Alan.

Agree with Alan, I sold my house and paid agent 3.0% commission, including all costs. No sell "“ no cost to me.

John, what I mean is if don't get asking price and pull out of market won't pay any "breakage fee" or advertising cost. As a seller I insisted to pay agent fee as a percentage .

An agent's fee is 3% or thereabouts. That's a one off, once only fee. How much does your mutual fund charge on the total amount you have invested with them per annum? It's common to pay 2% of the fund's value per annum. So if you have $1mil in such a fund you will pay circa $20k per annum to have it 'managed'. Want to rent your investment property and get a property manager to manage it? It will cost you about 7.5% per annum. Many professions charge fees. Shop around, negotiate, get good value - whatever you decide to pay in fees - it's your choice. It's all about self responsibility. To say "fees are expensive" is too general a statement. A classic example of not taking personal responsibilty for your decisions.

Good man Alan - keep telling that story.

Bernard : Re. Passing that potato compounds the pain (NZ Harold) : Follow grannie's advice and chew yer food properly , greedy guts ................ Never pass a gummy bear : Always stop for a chat .

Wally,

We're working on it. Great idea.
cheers
Bernard

Bernard
When you do you work on moving money to AUST to take advantage of the higher interest rates keep an eye on the cross rate this is where the banks make a killing.

dairy news from the States for those interested;

POWDER MARKET COMMENTS: Hints of possible weakness in the powder markets had been popping up in the press over the past several weeks, but the clearance sale that occurred last week caught almost everyone by surprise. We understand the export market for U.S. powder is weak and the prices available for those sales are not strong, and until recently cheese plants didn't have much incentive to use powder to fortify their vats. The volume reported last week by California plants was a record high, and the price was almost $.25 per lb below the week before. The average price reported by NASS fell "only" by about $.19 per lb "“ which indicates the lowest
prices for the week again come from California plants. The hints of weakness included stories about concern over when and how European regulators would begin to release the huge amount of skim milk powder they have in storage; last month's small drop in whole milk prices on Fonterra's internet auction; the price decreases reported for international prices; re-sales of some product; and the weak sales in October, November, and December (60 million fewer lbs of nonfat dry milk were produced in October and November than in the same months a year earlier, but the inventory dropped by only 8 million lbs over those two months). Does any of that warrant
dumping this huge amount of powder on the market at cut rate prices? Won't that simply depress sales over the next several weeks, or even months? Is that kind of "slash and burn" marketing which affects all producers consistent with the stewardship that supposedly comes with a position of leadership? Aren't plants reimbursed (through the make allowances they receive) for costs associated with manufacturing and marketing their products? If California producers are looking for someone to complain to, give Land-o-Lakes and California Dairies, Inc. a call. Their California plants produced almost 69% of all nonfat dry milk that was produced in the U.S. in October, and 59% of what was produced in November. Ask them if they even heard about whole milk powder (Dairy Market News this week reported that whole milk powder is in short supply in the U.S. and that some is even being imported from Australia to fill buyers' current needs). Ask them if they have something they call a marketing plan, and if they claim they have one you might ask to have them explain if what they did last week was part of the plan, and what affect that sale may have on maintaining good customer relations, price transparency, and industry stability. Surely, some public explanation will be forthcoming, won't it? While you're at it, you might also give National Milk Producers a call to inquire on how they're coming along on developing that great export incentive program that was first mentioned almost three years ago.

Cornell University's Program on Dairy Markets and Policy
Twenty years ago when I was first thinking about milk and dairy product prices, our domestic prices for cheese, butter, and nonfat dry milk were more than double the so-called world prices at that time. Today, our prices reflect the opportunities that exist to sell the product domestically or overseas. Over the past two decades, our prices haven't really come down to world prices. What has happened is that world prices have come up to intersect with our own.
For a very long time, Oceania (Australia and New Zealand) and Europe had been the major suppliers to the world. Occasionally, we had an opportunity to sell some powder "” or perhaps the need to reduce inventories "” but we were only a bit player.
Europe basically set the tone of world prices for commodities with policies that kept their domestic prices high by selling surplus product with export incentives. As low-cost milk producers, Oceania followed by selling product at the market clearing prices. When the European Union no longer could afford the post World War II agricultural policies, it began a process of embracing the WTO (World Trade Organization) goals of removing trade distorting policies. As less product was offered to the world market, world prices came up.
What are the implications?
As low-cost producers, Oceania responded to rising world milk prices over the past two decades by expanding production about as quickly as they could. New Zealand has wonderful pasture-based resources for producing milk, but they are quite land constrained. Land was bid up, making Oceania a high fixed cost, low variable cost producer of milk.
The United States has a very different milk production system based on intensive management and confinement. This is a high variable cost, relatively low fixed cost production system. The total cost of production in both areas is about the same and so is the milk price.

Bernard : The Minsky moment can be likened to your call for a 30 % fall in house prices ; in that it should occur , but may not . And even if the event happens , it is unlikely to do so in your time frame . .............The market can remain wildly over-priced longer than you can maintain your short position .

Andrewj,

(60 million fewer lbs of nonfat dry milk were produced in October and November than in the same months a year earlier, but the inventory dropped by only 8 million lbs over those two months).

The harsh reality that no dairy producer or processor yet seems willing to elucidate is that demand for dairy commodities is shrinking while supply remains relatively stable.

PeterR,
Thats OK, lots of empty storage space around the ports this year.

Wally, the bombs gone off. There is a hell of a lot of pressure contained in a whole lot of Bullsh*t, I don't know when its going to escape but Keep your head down.

Andrewj,

Thats OK, lots of empty storage space around the ports this year.

Storing increasing quantities of powder into a falling market didn't work well last time. And I don't know that this time the banks would provide the money required.

The end of this season would appear to be a good time for Fonterra's shareholders to cash in as many shares as possible - provided it is still possible by then.

Don't worry all. Guru Groser came on Morning Report this morning, assuring us in dulcet tones that we have merely to cling onto the coattails of Chinas 10% growth, and in 20 or 30 years, India will be where China is now???? so we should be in there too....

I emailed Morning Report, and suggested that regurgitating such demonstrable horseshit is not reportage, it's mere promotion of spin.

Read: propaganda.

It's about time we had the real debate in this country - whether you can have exponential growth without extraction of finite resources, and if you can't (Brownlees attack on the Doc Estate and Heatleys on the water-space says you can't) what should we do about creating a sustainable system?

Bah, humbug.

Great blog, no comment necessary
In our pride, denial and hubris, we as a nation still fancy ourselve a productive Empire. That is a falsity, a facade, a delusion we cling to the way an addict clings to his illusions: we're not addicted to debt, nosiree. We're just borrowing trillions of dollars every year to get through a "rough patch."

If trillion-dollar deficits are required from now until Doomsday, that's an addiction to debt. Claiming otherwise is the magical thinking of an addict in complete denial.

Let's set aside the pathetic bleatings of denial and the magical thinking which borders on psychosis for a moment and face the painful truth: what will happen should the Federal government stop borrowing and spending $1.3 trillion each and every year? What will happen when the Fed stops spending $1.2 trillion each year to prop up the housing market? What will happen when the Fed stops buying Treasuries to prop up the market for securities which will never be paid back at anywhere close to current value?

What will happen when the nation has to live within its means, without resorting to these trillions in welfare every year?

We all know what would happen: the U.S. economy, addicted to credit, debt and leverage, would crash.

Like an addict going cold turkey, there is no way to restore health except to end the addiction to borrowing and creating trillions in "free money."

What can we say about someone who believes that piling up more debt in an economy alrady crushed by debt will somehow create new demand for more debt and thus "consumer spending"? We would have to say that is magical thinking, the equivalent of thinking that one can eat cheesecake, Big Macs, fries and sodas every meal and not gain weight. It is magical thinking on a scale so colossal that it borders on psychosis--a complete detachment from reality.

Welfare, addiction, denial, magical thinking: these are not foundations of a healthy economy or mindset. They are a "sickness unto death," to borrow a phrase, an alienation, a hubris, and a state of denial so profound that the sanity of the addict/believer must be questioned.

That is the current mindset of the nation's leaders and much of its populace, who prefer the grand illusions of permanent adolescence, a childlike state in which they don't want any new taxes but they also don't want a single dollar of their entitlements cut, either.

Can there be any more profound detachment from reality than this childish demand that we live beyond our means indefinitely?

http://www.oftwominds.com/blog.html

Cheers,
David.