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90 seconds at 9 am: Australia abandons surplus goal; NZ to follow?; US growth expands, manufacturing up, house sales rise; gold takes tumble; NZ$1 = US$0.833
Here's my summary of the key news overnight in 90 seconds at 9 am, including news that Australia’s government said it’s unlikely to deliver a pledged budget surplus this fiscal year as weaker growth and a strong local currency reduce tax receipts.
This is a setback for Prime Minister Julia Gillard before an election that is due in late-2013.
As you will know by now, New Zealand's Q3 growth was way below expectations, and a target surplus here is looking unlikely as well.
However, growth in the US was higher than originally reported. Revised data out overnight shows that the American economy expanded by 3.1% to September, up from an expected 2.8% growth.
Supporting this expansion were reports out from the Philly Fed that manufacturing in their region grew more than expected. And US home sales have hit a three year high.
There is nothing to report on the fiscal cliff negotiations; they seem to have stalled for now.
Equity markets are ending the year on a stable note. Commodities are generally rising with oil up. Dairy prices were up marginally in the last Fonterra auction, but down a fraction in today's USDA report.
But gold has taken another tumble, now down to US$1,640/oz.
Related Topics
The NZ$ starts today pretty much unchanged at 83.3 USc, 79.6 AUc and the TWI is at 74.4.
This is our final 9am update for 2012. Merry Christmas from all of us at interest.co.nz, and we hope you have a fun holiday break. We return on Monday, January 14, 2013.
30 Comments
We're ending the year on a
We're ending the year on a high note , David ..... with the economy puddling along quite nicely ..... and with the knowledge that even if the politicians are granted their 1.8 % pay rise ( back-dated to July ) , Novopay will probably screw it up , any way .....
....... happy times , friend ..... Merry Christmas to one & all .....
Gummy .
GBH..the very best of food
GBH..the very best of food ,wine, family, and friends intentions upon you this Christmas.
Thanks for the humour, the positivity. the balance you brought as the occassion arose during the year .
Stay Well...I'll raise a glass to you Xmas eve, and look forward to seeing you around the trap in the New Year.
Cheers Mon Ami.
David, Gareth, Amanda, Alex, Bernard, Bruce, and others thanks for some great reads during the year , some insightful opinions, some good banter. Your tolerance also has been appreciated where topics may blur into comedy and so forth.
A most excellent Christmas to you all, look forward to seeing you , or not as the case may be when the New year fog rolls in.
To the usual suspects...Wooly, Walter Kunst, PDK, Steven, OMG,Scarfie, Iconoclast , A.J.,Omnologo , Notaneco, Stanley G, Ralph,Chris J,SoreL,Stephen H,Stephen L, Kermit , Mike B, Plan B, Cas Observer, S.K. Big Daddy, Dukey, Vanderlei L, Waymad,Colin Ridden, plutocracy, Anarkist, Ostrich, WTF,MIA, Chairman Moa, Kin, Elley, ex agent, Snippy, Midget Kiwi , Kiwi Dave,speckles, Nakonui G,HGW,Hugh P, Phill B, Ergophobia Chris M..............oh crikey, I know i'm missing stacks but you get the idea...! You have all made enjoyable reading on many occassions
My best wishes to you and thanks , we had the odd laugh , and that's gotta be good for us.
I'll try to get back for one last Friday Yay, if you hear a bang and feel a little scorched , I may not get to it.
All the very best upon you , enjoy your family, and all that we find little time for during the year.
And wishing you Christov, and
And wishing you Christov, and everyone else out there, a great Christmas and Merry New Year too!
Are you guys still putting up
Are you guys still putting up some fresh articles and 90 @ 9's over the Xmas-New Year period , Gareth ? ....
..... some of us don't have anywhere else to go ...... this is " home " ....
Merry Xmas : Gareth / Amanda / David / Alex , and of course , how could we ever forget the big guy , Merry Xmas to Brendon ..... ? ..... ooops , Bernard !
Yes, we plan to keep the
Yes, we plan to keep the updates coming. Should be a Top 10 every business day. Full service resumes January 14.
Have a good one Gummy, and
Have a good one Gummy, and watch out for fiscal cliffs.
All the best Gumster. Thanks
All the best Gumster. Thanks for making us laugh, repeatedly. Joyeux Noel.
My highlight was his mioos
My highlight was his mioos and boon dairy farmer,
He seized her , in his strong manly arms ..... Clarabell felt a flush upon her cheeks , and a quiver of expectant excitement rippled through her udder as he raising the cups to her fulsome teats ..... she knew she could not hold back , she must offer up her milk , all of it , to this strong irresistable masculine force .....
..... ah , the romance of the 5 a.m. milking !
...... she was spent , fully exhausted .... she had given her all , and knew that she had satisfied her man like no other could ...... she pressed her blood engorged ruby red lips up against his ear , and whispered " moooo ! "
Moos & Boon : The Dairy Chronicles .
Have a great Xmas and New Year all, Im off to the UK for a few weeks. Thanks for all the great comments and the education.
All the very best to you and
All the very best to you and yours, Count, and to all other posters - and not forgetting Interest.co, which is a refreshing venue for views which would be subject to pc censorship pretty much anywhere else.
Next year is going to be interesting ;-)
Merry Christmas & a Happy New
Merry Christmas & a Happy New Year!
I wanted to send some sort of holiday greeting to my friends and colleagues, but it is difficult in today's world to know exactly what to say without offending someone. So I met with my lawyer yesterday, and on advice I wish to say the following:
Please accept with no obligation, implied or implicit, my best wishes for an environmentally conscious, socially responsible, low stress, non-addictive, gender neutral celebration of the summer solstice holiday practiced with the most enjoyable traditions of religious persuasion or secular practices of your choice with respect for the religious/secular persuasions and/or traditions of others, or their choice not to practise religious or secular traditions at all.
I also wish you a fiscally successful, personally fulfilling and medically uncomplicated recognition of the onset of the generally accepted calendar year 2013, but not without due respect for the calendar of choice of other cultures whose contributions to society have helped make our country great (not to imply that New Zealand is necessarily greater than any other country ) and without regard to the race, creed, colour, age, physical ability, religious faith or sexual preference of the wishee.
By accepting this greeting, you are accepting these terms:
This greeting is subject to clarification or withdrawal. It is freely transferable with no alteration to the original greeting. It implies no promise by the wisher to actually implement any of the wishes for her / him or others and is void where prohibited by law, and is revocable at the sole discretion of the wisher. The wish is warranted to perform as expected within the usual application of good tidings for a period of one year or until the issuance of a new wish at the sole discretion of the wisher.
Best regards (without prejudice)
Name withheld (Privacy Act).
I wonder whats the end game
I wonder whats the end game for gold....
Is it the inflationistas hoping to make a killing on its rise, ie un-earned speculation/gambling? (added and some are now exiting?)
Around the developed world we see little sign of inflation so this realisation is why the price is dropping? Though china etc seems to be seeing some which is interesting in itself....but otherwise its looking like a long time low inflation or deflation aka japan....in which case gold holding its value seems likely?
If youbelieve that its something to "trade" for food in a zombie apocalypse scenario then surely the old backstop, pb is far better?
just curious.
regards
The reported inflation rate
The reported inflation rate is low, but is the real inflation rate that low?
including or excluding
including or excluding housing?
Why would you not include the
Why would you not include the cost of housing?
This was my attempt at being
This was my attempt at being facetious, probably didn't come across in the comment too well :)
Of course you should include all costs that you would reasonably incur into inflation even if the CPI does not. It is also fair to say that AKL real inflation is higher than the rest of the country as living in AKL becomes more expensive relative the the rest.
So if house prices are
So if house prices are severly down in say invercargill?
regards
Depends on how you consider
Depends on how you consider house prices in inflation. If a person does not move then their housing price is not factored into their inflation. However, most people will move at some point so it should be included somehow.
I would suggest smoothing the increase over the the average length of time of occupation. This would include all housing costs: the mortgage, improvements, maintenance, buying and selling costs etc. A total cost of owership model. As we are looking at inflation, it is only the change in these costs over time that we are interested in. This will then give you a true inflation cost.
Note that your personal inflation costs can be manipulated in a number of ways so that you come out better by moving less often, arbitraging prices (a la Bernard Hickey) timing the market or renting instead of buying.
Well you either accept the
Well you either accept the data (after cross checking of course) or what your imagination thinks it is.
You could of course look at proxy data, things like is un-employment up or down?
The biggest for me is, are wages rising....no they are not...ergo some things are inflating and some things therefore have to deflate, overall we have no inflation....and that is one of the biggest.
Then there are things that mask or could fool you into thinking inflation is rising, such as exceptioanly cheap interest rates is encouraging speculation in commodities and housing, hence some bubble. Or OEPC's inablity and wish to keep oil prices down....at $112 a barrel do you really believe that they wouldnt pump faster to get more $s?
Up to you really....
Im going with the data.
regards
It is the official "data"
It is the official "data" that I am questioning...
OK, well mostly I do not,
OK, well mostly I do not, most anything else of course than the offical data has no mathematical basis or foundation to make sound decisions on.....
So sure you buy gold who will you sell to? think tulips, in fact I think whenever you see any item that is "appreciating" without good cause you have to consider if its a bubble or not and you are gambling that you can sell.
Housing for instance is only doing very well in a few areas....and really its value has to be under-written by the futire ability to pay for it. Otherwise really you are gambling that there will be a bigger fool than you.
Comes back to what can you do with gold that you could do with say something else? Is the idea to trade in an otherwise depressed or inflation crippled economy? or what? Consider ammunition....its a commodity price, there is no specualtion in it, so its very unlikely to be in a bubble (though its over-priced compared to the USA, so thats a risk). So lets start with gold, its currently $1973NZ per ounce Ammo say 22LR, 25000 rounds, which is more tradeable? which will hold its value better? honesty its hard to know, human behaviour plays a crucial part and that is hard to quantify.
What else is there? tools.....again over-priced compared to USA, maybe I could buy $1973 worth of spades....or improve (diversify) my skill sets, the Govn cant take that....they can take much else....
Which I suppose brings me to full circle, the danger is a Govn....they can take gold....America did it...but then its dense and easy to hide....
What do you want it for?
regards
I agree. Financially-induced
I agree. Financially-induced inflation now is stealing inflation from the future and therefore multiplying our future pain.
Fitch comfortable with
Fitch comfortable with Aussies missing budget surplus.
Fitch Ratings-Hong Kong/London/Singapore-20 December 2012: Australian treasurer Wayne Swan's acceptance today that the government is unlikely to deliver a budget surplus this year (fiscal year 2012-13 ending June 2013) is not surprising and will not affect the sovereign's 'AAA' rating, Fitch Ratings says.
Australia's low sovereign debt ratios mean that it can afford to reduce its deficit more slowly than other 'AAA' economies, with more consideration for supporting its slowing economy and without diminishing its ability to absorb fiscal and economic shocks. We expect gross general government debt to peak at 28% of GDP next year. The median for 'AAA' sovereigns is 52%. Moreover, the sovereign's debt composition is a rating strength. The average duration and maturity of the debt have risen since the global financial crisis and almost all debt is in Australian dollars.
We had already concluded after the budget speech in May that it would be challenging for the government to return the commonwealth government budget to surplus. This is because of its reliance on a mix of revenue-enhancing measures (such as foregoing the company tax rate reduction) and spending cuts relative to fiscal projections, particularly if the economy slowed.
The slowdown in China has already affected the prices of Australia's coal and iron ore exports. Australia could be significantly hit if China has a "hard landing", although this is not our expectation.
Fitch upgraded Australia to 'AAA' from 'AA+' in November last year, citing the country's strong credit fundamentals. At the time, we said that successful implementation of the government's medium-term fiscal consolidation plans would support the ratings.
Thanks, however china not
Thanks, however china not having a hard landing seems a bit of wishful thinking IMHO. A 10% per annum growth means a doubling every 7 years. 5 years after the GFC I look and see a lot of "make work" to keep that meaningless growth trajectory going....ie it isnt real IMHO.....ergo I think there is going to be a (very) hard landing....maybe its 2 or 3 years out yet....so how long can they keep the make believe confidence trick going?
regards...
I just wonder whether they'll
I just wonder whether they'll be so forgiving when/if our govt admits it'll miss its surplus target too...
Whats the trajectory though?
Whats the trajectory though? still up, even in a world economy that is at best aneamic. Look at say, Greece and Spain, they look to be an an un-controlable tail spin. US states are in a bad way, japan a bad way.....so little real positive news.
Of course we hang on OZ, China and our overblown housing market....the first two look like a trigger the latter how big it might be.
regards
Here is my summary of the
Here is my summary of the news.
MP's wages are up. Ditto Bwankers. Hand in the till, snout in the trough. (Depression for most, not for sum)
MP's rentals & houses are up. Ditto Bwankers.
MP's shenanigans are up. Ditto Bwankers.
MP's are Gambling with Taxpayers and mummies money, Casinos benefit. (Others lose)
MP's waste is up, Bwankers and Crony Capitalists benefit. (Others lose)
MP's are on Holiday for next 3 months, others working for next 3 months to pay for those holidays. (Others lose)
MP's flitting around the World, pontificating, endless gassing and worrying how to save the World, from their excess production of killer gases and excess benefits, throwing money around, left, right & Centre. (World loses).
Speakers changed, he benefitted. Ratepayers and Taxpayers will still have no ...SPOKESMAN........though new one appointed.
(Whew....Lucky it was not Hone...annointed, I would really have been...DISSER-POINTED.)
Snivel Serpents having a well earned, well paid break. (More troubles, more strifes, more problems....they created......ever invented)
Petrol tax going up up, as none of the above, over taxed....
So guess what....will all the above....be totally....INFLATED, RINSED, REPEATED.
SAVERS interest , down. Praise the Lord, this Christmas. Halleluyah.
Merry Christmas suckers.
And that is NOT...repeat....NOT to those sucking on the TIT.....benefitting.
PS...how much TAX & SAVINGS does it take to ruin a Nation....ALL OF IT.
MP's PAY.....NOVOPAY, NOVO
MP's PAY.....NOVOPAY, NOVO VIRUS....MILLIONS WASTED, MILLIONS PILLAGED, MILLIONS BENEFITTED
A plague on all their houses..
Taxpayers......paid....who cares???????????.
(ONLY ME).
Politically Correct
Politically Correct Holiday Party...
Worth repeating, worth sending on.
This may be your last REAL.....CHRISTMAS.
(Signed ....the nay sayer)
Subject: The Office Party FROM: Pat Lewis, Human Resources Director TO: Everyone RE: Christmas Party DATE: December 1
I'm happy to inform you that the company Christmas Party will take place on December 23, starting at noon in the banquet room at Luigi's Open Pit Barbecue. No-host bar, but plenty of eggnog! We'll have a small band playing traditional carols...feel free to sing along. And don't Be surprised if our CEO shows up dressed as Santa Claus!
FROM: Pat Lewis, Human Resources Director DATE: December 2 RE: Christmas Party
In no way was yesterday's memo intended to exclude our Jewish employees. We recognize that Hanukkah is an important holiday which often coincides with Christmas, though unfortunately not this year. However, from now on we're calling it our "Holiday Party." The same policy applies to employees who are celebrating Kwanzaa at this time. Happy now?
FROM: Pat Lewis, Human Resources Director DATE: December 3 RE: Holiday Party
Regarding the note I received from a member of Alcoholics Anonymous requesting a non-drinking table ... you didn't sign your name. I'm happy to accommodate this request, but if I put a sign on a table that reads "AA Only" you wouldn't be anonymous anymore. How am I supposed to handle this? Somebody?
FROM: Pat Lewis, Human Resources Director DATE: December 7 RE: Holiday Party
What a diverse company we are! I had no idea that December 2 begins the Muslim holy month of Ramadan, which forbids eating, drinking and sex during daylight hours. There goes the party! Seriously, we can appreciate how a luncheon this time of year does not accommodate our Muslim employees' beliefs. Perhaps Luigi's can hold off on serving your meal until the end of the party - the days are so short this time of year - or else package everything for take-home in little foil swans. Will that work? Meanwhile, I've arranged for members of Overeaters Anonymous to sit farthest from the dessert buffet and pregnant women will get the table closest to the restrooms. Did I miss anything?
FROM: Pat Lewis, Human Resources Director DATE: December 8 RE: Holiday Party
So December 22 marks the Winter Solstice...what do you expect me to do, a tap-dance on your heads? Fire regulations at Luigi's prohibit the burning of sage by our "earth-based Goddess-worshipping" employees, but we'll try to accommodate your shamanic drumming circle during the band's breaks. Okay???
FROM: Pat Lewis, Human Resources Director Date: December 9 RE: Holiday Party
People, people, nothing sinister was intended by having our CEO dress up like Santa Claus! Even if the anagram of "Santa" does happen to be "Satan," there is no evil connotation to our own "little man in a red suit." It's a tradition, folks, like sugar shock at Halloween or family feuds over the Thanksgiving turkey or broken hearts on Valentine's Day. Could we lighten up?
FROM: Pat Lewis, Human Resources Director DATE: December 10 RE: Holiday Party
Vegetarians!?!?!? I've had it with you people!!! We're going to keep this party at Luigi's Open Pit Barbecue whether you like it or not, so you can sit quietly at the table furthest from the "grill of death," as you so quaintly put it, and you'll get your freaking salad bar, including hydroponic tomatoes. But you know, they have feelings too. Tomatoes scream when you slice them. I've heard them scream. I'm hearing them scream right now!
FROM: Teri Bishops, Acting Human Resources Director DATE: December 14 RE: Pat Lewis and Holiday Party
I'm sure I speak for all of us in wishing Pat Lewis a speedy recovery from her stress-related illness and I'll continue to forward Your cards to her at the sanatorium.
In the meantime, management has decided to cancel our Holiday Party and give everyone the afternoon of the 23rd off with full pay.
We hope that this change does not offend anyone.
In the true spirit of Christmas....mine's a large BRANDY.
Have good one.
Merry Christmas...to all our readers.
Cheers Sorel...enjoy , be
Cheers Sorel...enjoy , be well.
Cannot complain...often
Cannot complain...often do.
Tis why I drink. Though I cannot remember why.
I joined the AA....but they just wanted to insure me. I forget why.
I joined the Labour Party, they just wanted me to work. Forget it.
Then I joined the National Party, but that was not working either. So forgot that.
Then I joined the Conservatives, but I stood out like a sore thumb. so they told me to forget it.
So I drink....and have a laugh.
And party on my own, in my own time, with my own munny.
Cannot win, but I can still whine and dine...so cannot be all bad.
Signed....
A very, VERY, MERRY......
Sore Loser.