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We review our big stories of 2013 and seek readers opinions about what 2014 will bring

Posted in News

It's 2014 and time to look forward.

The purpose of this story is to provide a place where readers can prognosticate; what do you think will happen to our economy in 2014 ?

More specifically, where will interest rates go in 2014 - and why ?

This is also a place were you can give us your views of what will happen to property prices in the coming year.

And, of course, its election year.

Thank you GBH for the idea.

But before we get into 2014, here are our top stories of 2013.

We are very lucky to have a talented team of experienced journalists, contributors, and analysts.

Related Topics

We have had a big year. We published 3,700 stories plus countless other resources (charts, tables, calculators, database entries, curations, the list goes on ... )

You read 9.3 million pages of content in 2013. And there were about 1.2 million of you who visited (although maybe a few less - we count 'unique ip addresses' in the year and many more of us are now using multiple devices). However many of you there were, you came to visit 4 million times and stayed an average of 3 minutes 20 seconds.

Our videos were viewed 120,000 times and you spend a remarkable 6,800 hours watching our content.

My personal view is that 2014 will be a year when New Zealand interest rates break higher. But I don't know any more than you and I am interested in what you think.

Here are the top ten stories we published in 2013.

#1 - Bernard Hickey's fixed-or-floating review. (This story was read 25,000 times.)
http://www.interest.co.nz/property/62755/bernard-hickey-looks-whether-or-fix-or-float-and-whats-happening-house-prices-he-also

#2 - Olly Newland's view of how to deal with the LVR restrictions.
http://www.interest.co.nz/property/65570/olly-newland-recounts-ways-avoid-lvr-restrictions-and-forecasts-stagnant-rents-are-ab

#3 - The competitive nature of our mortgage market.
http://www.interest.co.nz/news/64687/mortgage-specials-testing-limits-what-commercially-sustainable-banks-back-foot

#4 - Tony Alexander on where he thinks mortgage rates are going.
http://www.interest.co.nz/property/67445/bnz-chief-economist-tony-alexander-believes-some-home-owners-might-be-complacent-abou

#5 - Bernard Hickey on what the RBNZ rate signals mean. (This story was read more than 6,000 times.)
http://www.interest.co.nz/personal-finance/67102/bernard-hickey-looks-what-reserve-banks-ocr-decision-means-mortgage-rates-and

#6 - Tony Alexander warning of significant mortgage rate rises.
http://www.interest.co.nz/property/64796/bnz-chief-economist-tony-alexander-sees-floating-mortgage-rates-hitting-85-within-nex

#7 - Another story about home loan rate reductions and the competitive nature of our mortgage market.
http://www.interest.co.nz/news/63056/new-aggressive-mortgage-pricing-westpac-signals-clear-goal-win-market-share-rivals-big-re

#8 - Westpac economists warning that house prices may fall.
http://www.interest.co.nz/property/66896/westpac-economists-now-picking-actual-falls-new-zealand-house-prices-about-two-years

#9 - A savvy mortgage broker seeing unrealistic sellers in the Auckland housing market.
http://www.interest.co.nz/property/64021/nutter-room-one-buying-auckland-houses-says-mortgage-broker-many-sales-going-auction

#10 - John Bolton on how demand and perceptions are changing in Auckland suburbs. (This story was read 5,000 times.)
http://www.interest.co.nz/property/62269/how-and-why-previously-unfashionable-auckland-suburbs-are-becoming-popular-and-causin

You read a lot of stories, but these volumes pale in comparison to the number of times you used our databases.

For example, our mortgage rate database was read more than 580,000 times; our TD database pages more than 350,000 times.

Our Currencies section was accessed more than 200,000 times, our Bonds section more than 270,000 times - and that is about the same as our KiwiSaver section.

Our Rural section was read 500,000 times.

Our calculators were used more than 300,000 times.

And thank you for the 40,000+ comments in 2013.

We loved every minute of 2013 - and it helped that the overall New Zealand economy strengthened as the year progressed and ends in pretty good shape compared with the past few years.

Now want to hear what you think 2014 will bring.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment in the box on the right or click on the "'Register" link at the bottom of the comments.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current Comment policy is here.

219 Comments

Hmmm, this is merely

Hmmm, this is merely speculation but here goes:
1 German banking crisis finally arrives big time. So far they have bankrupted the rest of Europe to save the German banks. Eventually the truth will come out.
2 Drama will unfold sequentially for currencies worldwide as the USD strengthens. So far India, Brazil, Indonesia, Japan, Australia and Turkey and gold and silver (still a currency in many parts) have dipped. The Yuan, (or is it the Renminbi?), the Euro, and of course the NZD, will follow in due course. Could get quite exciting.
3 Oil and petrol will get cheaper.
4 Interest rates in NZ will rise until some international event happens causing stock markets to fall in the US.
5 The sun will shine.

Happy New Year Rogie ! ....

Happy New Year Rogie ! .... so you reckon the sun will shine , huh ? ....we last saw it on Christmas eve ... hope for us yet ... glad I'm not in Hokitika today ... Ka-Boooooom ..

Same to you. Funny how good

Same to you. Funny how good news isn't newsworthy, only Doom and Gloom. If there is not enough Doom and Gloom then some people seem to need to invent it. Keep up the light hearted banter and let us know what you're finding interesting out there.

Doom & Gloom sells copies ,

Doom & Gloom sells copies , it get's the clicks .... have you ever witnessed Bernard Hickey when he's forced to announce some good news , instead of his de riguer gloomsterisations ?
 
....  it's an awful sight , blood-curdling even .... he squints at you , sucks his face in , and mutters between clenched teeth ... ... gosh , he almost looks like he's David Cunliffe's taller twin brother ... scarey .... truely scarey ...

David Cunliffe is a very

David Cunliffe is a very scary chap. So certain he is right.
 
I hope the Nats are able to find some good ideas from somewhere, they are looking like they are getting tired. I expect they plan to get out the goody bag to limp into a classic worn out and stagnant third term.

Interesting

Interesting predictions....Re:1 put hand in buzz saw try and figure out which one cut you first....
Re: 3 yes as per 2008, GFC no2, oil = $35USD.
Though 2014? not sure.
Crude oil falls off the production plateau?
 
regards

40 000 + comments in 2013 !

40 000 + comments in 2013 ! .... I thought the figure would be 10 times that ....
 
....  hang on a mo' .... did you forget  to count steven's contributions ?

Cant resist a snipe can you

Cant resist a snipe can you GBH.
regards

Gallinago gallinago ? ....

Gallinago gallinago ? .... who could resist them , they're such cute little fellows ....

Very tasty too. Hard to hit

Very tasty too. Hard to hit though, all that zig zag flying they do.

For the record, here is GBH's

For the record, here is GBH's earlier post on this story.
-----------------------------------------
Gummie's 2014 Prognostications :
 
National to narrowly beat Labour/Greens in the 2014 general election .... the Gnats had an appalling 2013 , and yet L/G made little headway against them ... whether it's the threat of CGT , higher income taxes , or we just don't like Cunliffe , L/G are doing it harder than they should be ...
 
 $NZ to peak around 95 cents Oz ... but not necessarily to end 2014 at that elevated level ....
 
.... best performing developed country stockmarket : Australia ... on the back of 1 or 2 RBA cuts to their OCR ... SME's to have a stellar year ...
 
Gold : down .... down ... down .... finally people are listening to Warren Buffett ... gold is a stupid " investment " .... it sits there and does nothing , diddly squat ... in order to profit  you have to wait for someone even stoopider than you to come along and buy it .... and what're the odds of that ....
 
... house prices to continue their upwards trajectory ... LVRs... CGT ...higher interest rates .... banning foreigners ... all BS to appease the masses ... the fact is , Oliver Hartwich is correct , we have screwed up the supply side of the equation for decades , and are now paying the price , literally ... Ollie Newland to finish 2014 with a big " I told you so " grin on his chops ...
 
Mrs Brown to file for divorce ... even if the super city can't roll Len  for his appalling behaviour and his arrogance , the good lady mayoress can .
 
... and one from left field ... a Kiwi or Aussie  rugby player when being interviewed , will spontaneously combust immediately after saying " we had to dig deep " ... and never again will players use that excretiable expression .... horticulturists dig deep ... footy stars play with their balls ... no digging ....

Charles Hugh Smith details

Charles Hugh Smith details the best and most accurate set of projections I have seen yet:
 
http://www.oftwominds.com/blogjan14/trends-to-watch1-14.html
 
They are hard to fault - as an example:
Trend #5:  Junk fees will continue to replace legitimate taxes.  Fearful of blowback from ever-rising taxes, local governments have turned to junk fees as the preferred method of “revenue enhancement.”  These include sharply higher fees for recreation, parking tickets, permits, etc., and a multitude of add-ons to property taxes and other existing tax structures. Local authorities are counting on the taxpayers to sigh but do nothing as long as the fee increases are small enough to avoid triggering political resistance.

And we have seen the rise and

And we have seen the rise and rise of fees over the last decade. Just take care when borrowing ideas about local government from other countries that you compare apples with apples. In the US local government provides more services by way of social services and emergency services than our councils do. So our councils don't have the demand for services squeeze to the same extent as in the US. This doesn't mean that they can't hide a few sins by makiing sure fee-based revenue is healthy.
 
My annual food licence is about double what my local council is legally entitled to charge but it does mean they don't have to be accountable for the public good services that justifies their staffing levels. That would be the norm for the sector. If I lived in Christchurch City that fee would be double again.

I wouldn't call them "junk

I wouldn't call them "junk fees".  Any normal business or person provide a service has costs, there is no reason that those costs should not be related (passed on) to the project that creates them where practical.   Likewise if a business or person is not willing to pay the cost of a good or service that they desire, then I fail to see any possible justification that others should be forced to pay that cost for them.

Only in passing on those costs to the relevant centre can people then look at the costs and say "that's unreasonable amount of cost" for a service.  At the moment, councils just expect everyone to pay, pay, pay and that ratepayers can face an infinite number of rate hikes above inflation rate; and that they (councils) refuse to oppose central government and themselves on unreasonable level of costs/requirements.

I think we had different

I think we had different "junk fees" in mind. Take P.N.C.C. They have chosen to increase 'revenue' rather than control costs. No surprises there - the Council's costs mostly being staff salaries.
 
So the clever Council enters arrangements with the private sector to increase 'revenue' from parking fines. New meters with parking sensors are installed likely under some form of shared cost/revenue basis. The new technology allows wardens to be directed to your vehicle as soon as you are overstaying.
 
Parks are numbered randomly to confuse punters. More parking wardens are employed. Strict two hour parking limits are imposed. And the fine revenue rolls in - much of it from people who have paid - but for the wrong park. Tough - no excuses accepted.
 
There is of course a backlash. Made worse by some Council emplyees who know that by parking before 8.00am the system ignores you all day exploiting that knowledge. And made worse again when it becomes known how many important people including Councillors have parking exemption stickers.
 
Part of the backlash is that the numbers of vehicles using the Council's metered parks drops - some streets are now free of parked cars during working hours. Who is wearing the lower than projected 'revenue'? I suspect the ratepayers more than the private party involved.
 
The political backlash has now seen parking fines reduced and some tolerance allowed - for the time being. 
 
I think such Council fees/fines would be better described as 'extortionary' rather than junk.
 
Which brings me back to Charles Hugh Smith:
Outcome #7:  The trend of the Status Quo “solving” perceived problems by adding layers of immense complexity to systems already suffering from marginal returns will continue.
 
Outcome 7 also perfectly fits with HBRC and their efforts to improve their mismanagement of the Tukituki catchment.

Speaking from a design point

Speaking from a design point of view, the use of randomised numbers is done to -reduce- the number of faulty inputs.

By using a limited and non-related selection identities it is (theoretically!) more difficulty to accidently hit the wrong key (entering park 5, instead of 6) and the Set can be validation checked at point-of-entry.  It also reduces the likelihood of "mindtricks" especially amongst the more CDO of us.   (CDO is like OCD but with the letters in the correct order).
 We see the parks C1, C2, C3.... then we are just as likely to enter C3 as C2 just by the way the human mind processes the patterns.

Sadly, as you have noticed, it seldoms works well in the field - it allows for validation of entry, but often the selection can be a random one of any of the valid options, as the human mind not only plays with such data, that's also how it remembers things, by relating it to patterns and information it already has , and has weighted.   Thus the random numbers seldom "stick" in a persons mind, and they're just as likely to remember a previous one, or one of the others they caught out of the side of their field of vision, of that had a noticable car or absence of car ...pretty much anything that gives that "identity" number higher processing weight than the "correct identity".   This is re-inforced because often "our safe car" in an easily read spot has little or no processing importance behind it, and the very ease of identifying the data results in the brain as treating it with contemptable familiarity (ie dropping the actual information)

I would just add that it

I would just add that it should have been simple to extend validation to assist the user if that had been part of the intent of the design:
 
Yes, you have entered a correct parking space but: It is unoccupied; Has been occupied for more than 15 minutes or; Is about to exceed the maximum parking time allowed.
 
It would appear that assisting the car park user may not have been in the intent of the design brief.

Happy New Year Colin.....this

Happy New Year Colin.....this one should be a doozy...!!

Thanks Christov.   A doozy

Thanks Christov.
 
A doozy year? O.K, but doozy can mean anything form daunting to problematic to excellent.
 
The year is expected to start with positive perceptions so it will begin for most as a doozy year.
 
I expect the year to end problematic so it will still end as a doozy year - but very different to the start.
 
Christov, doozy is a great adjective to use to describe 2014. You are considering entering politics?

I think your right about late

I think your right about late this year Colin.......Bondholders of U.S Debt get pantsed.....not optional......China pay the premium for subsidised exporting.
 The Boj will go crazy mad printo facto....then just crazy mad.
 The Euro are in cahoots with the Fed...some big shit going down this year...I am sure of it.
 Big Question is wheter the Euro will stand another stress test of Political alliance.....you know them froggies can never seem to make up their mind which side their on....the Italians keep their hands in the air just waiting to capitulate to the apparent victor.

It is just a matter of time -

It is just a matter of time - but no one knows how much time that is or which asset bubble will go first. The favoured few might get a little advance notice but I am not sure it will make a lot of difference.

yep, and who's going to buy?

yep, and who's going to buy?  Everyone I think who's bright and playing believes they can get out before everyone else, in the mean time greed rules the day.    The dumb ones, and there are a lot will be,  "wtf was that"? 
regards
  

And the 'bright' ones may be

And the 'bright' ones may be proved not so bright if they were believing the rules will be followed. 

Un-written rules and written

Un-written rules and written ones....look at that Japanese bank thinking it could get away with it...
Going to be more like that I think.
(in fact a lot of commercial melt downs ~ bad coprorate debt)
regards

you've got to allow for the

you've got to allow for the bearucrat factor.

An engineer will look at the requirements and the application and design something to meet the project goals.   eg best way to identify available parks.

An engineers manager will look at accepted design solutions and add whatever is already checklisted as effective. eg the fastest way to add features.

The first one is slow and expensive.
The second one is effective because it says so on the box/brochure (while the first isn't documented AT ALL!).

So guess which one you get :)
 

Agreed.   You get the one

Agreed.
 
You get the one that appears (before incompetence is factored in) to extract the most revenue from residents/ratepayers. 

still on a design

still on a design theme:

actually the one that will jump off the shelf (pricewise) to customers such as councils.  Cuts have to be made somewhere so they can afford higher wages than the private sector...

There is a sort of food chain

There is a sort of food chain involved here.
 
The finance sector is higher up the chain than Councils. Councils not being very financially literate are mostly nursing loses to interest rate swaps (the finance sector is conversely doing very nicely from the same).
 
Wouldn't the best way for Councils to gain more to lavish on employees be to improve their financial management?
 
Or is it that most Council's finance teams already effectively control Council policy, recruitment and budgets? 

Indeed....I get the distinct

Indeed....I get the distinct impression that councils went into "finance" initially to make interest on their rates income but moved to more and more risky stuff to improve their returns (or maybe not see such declines), and it seems are getting burned....
regards
 

It is simple. Most Councils

It is simple. Most Councils want to spend more of other peoples money.
 
But they face backlashes over rates and fee rises.
 
So instead they borrow and pass the costs on to future generations. This requires significant spending on perception management to deceive us that such borrowing is about intergenerational equity. 
 
Lies, lies and more lies.

Yep. regards

Yep.
regards

I know I post this every

I know I post this every three months but the facts about council financial management are:
 
1. Councils can only borrow to fund capital expenditure (roads, pipes, buildings etc) - they can't borrow to fund an operational shortfall. By definition borrowings are always linked to long-life assets so borrowing has the side effect of delivering transgenerational equity. But that's not the reason they borrow; they borrow because they have no capital.
2. Councils create financial plans that are highly detailed for three years out and detailed for a further seven to make a total of a ten-year plan
3. Councils financial plans are independently audited before they are released for public consultation and they are audited again at the end of the financial year.
 
I can only speak from personal experience but council staff (not necessarily councillors) are good at the financial planning/budget management side of things. They don't need to know much about more sophisticated financial instruments although they will hedge against adverse interest movements on their borrowings.
 
Doesn't mean they don't pull a few swiftiies but the swifties are competently executed. I find it useful to think of councils as competent organisations that just happen to exist in a parallel universe from the rest of us.

They are junk in the sense

They are junk in the sense that the quantum is not related to either the true cost of providing the service especially in the regulatory area or related to achieving the public outcome that they are supposed to encourage.
 
Parking fees are a classic example. The rationale for parking fees is to encourage turnover in parking spaces. This makes it possible for visitors to a location to access buildings for a short time (where retail outlets are the obvious example). The second your parking regime creates empty spaces instead of turnover you have failed miserably.

agreed.  If they (council &

agreed.  If they (council & parking fees) were working properly then the funds would be used to construct safe long-term parking for staff in (C)BD accessable areas.  That would free up shorter term parking in the retail areas for customers, rather than create competition and revenue gathering   ... but what kind of council would ever want to increase sales to it's central retailers (there's no power buzz in that!)

Well thats just buggered if

Well thats just buggered if thats the idea. For myself I dont go to the Wgtn CBD as its too expensive to park, unless I take the train.
regards

Good link Colin. I think the

Good link Colin. I think the reason the analysis resonates is because Charles Hugh Smith is from California and like New Zealand California has messed up its sub national governmental system. Localism has failed there. But with localism you will get a mixture of success and failure depending on which local policy mix is the most adaptive and within the US as a whole it is not all failure.
 
The Southern and central States are doing well. They have not priced themselves out of the market with crazy urban land supply rules. They have attracted good businesses like Alabama's airbus factory. Middle class migrants are flocking there to achieve the income and inquality improvements that Charles Hugh Smith complains about.
 
California like NZ needs to have a hard look at itself and improve its local policies and institutions before blaming someone else.

Front page news. Parking

Front page news.
Parking fines are down, causing one Council to lament to the tune of 900,000 dollars.
They were banking on the funds, to keep em a float.
(a float is an old shopping term for the cash register kitty, before credit was norm...at Harveys).
Also the bright sparks in Government give dispensation to the poor repeat sods, who cannot pay the whopping fines at all, an amnesty was given for the poor delinquents, just before Christmas, cos they wasted the money on gas to get to the parking slot in the first place, but had all day to waste, so got fined, but did not care, they were never going to pay, anyway.
So it maybe up to the middle class to fund the poor delinquents, poor Councils and the uber rich, who cannot put a foot wrong.
Maybe Councils and Government may have to think twice, where the money for their wastage is coming from.
So get on yer bike Councils and citizens, follow John Key's mantra.  Cannot go wrong, with a village bike. Follow the trails, follow my "Dear Leader".
Ask Len too.
 
 

We spend billions of dollars

We spend billions of dollars to build roads so traffic can move more smoothly then the Council allows the roads to be blocked by parked cars.
Roads should be for moving vehicles only and all stationary vehicles in car parks only. But then think of all that revenue the council will loose. So we have blocked roads and a bloated Council.
 
Councils use to do all the work themselves but got lazy and get contractors to do the work. Take rubbish bins. The Council tales my money to remove my rubbish but then does not want to do the job so gives it to a contractor. The Council are just the middleman taking a rake off us. If they do not want to do the job they should say so.
 

I've been reading a bit

I've been reading a bit recently on the way cars took over the roads in the 1920s and 1930s, and the way other road users had to be moved out. 
http://paleofuture.gizmodo.com/the-invention-of-jaywalking-was-a-massive...
When you get down to it, none of our core centres of our cities were designed for cars, and it shows with all the adhoc band aids like parking that are needed for things to function.

I think Romania did something

I think Romania did something like ban donkey and carts recently - hence lots of donkey meat passed off as beef in Europe.

I think you'll find

I think you'll find Roger...the Donkey's meat was passed off as Bratwurst in the Germanic Region....hence the sudden popularity of those bloody sausage stands all over the show.
The Octoberfest  made Donkey doodles as popular as turkeys on Thanksgiving......
 Hey It is Friday right...?

A law banning horses from

A law banning horses from Romanian roads may be responsible for the surge in the fraudulent sale of horsemeat on the European beef market, a French politician said yesterday.

Horse-drawn carts were a common form of transport for centuries in Romania, but hundreds of thousands of the animals are feared to have been sent to the abattoir after the change in road rules.
The law, which was passed six years ago but only enforced recently, also banned carts drawn by donkeys, leading to speculation among food-industry officials in France that some of the “horse meat” which has turned up on supermarket shelves in Britain, France and Sweden may, in fact, turn out to be donkey meat. “Horses have been banned from Romanian roads and millions of animals have been sent to the slaughterhouse,” said Jose Bove, a veteran campaigner for small farmers who is now vice-president of the European Parliament agriculture committee.
http://www.independent.co.uk/news/uk/home-news/horsemeat-found-in-britis...
 
Doesn't seem to mention which parts ended up where, but I bow to your superior knowledge of the making of blood sausage, Christov. Sounds like a typical stupid EU inspired law, bloody bureaucrats.
 

Interest rates already

Interest rates already breaking higher. More of the same for 2014as the banks show their proverbial finger to the OCR. Banks record another $5billion dividends repatriated to Australia as the conveyor belt dividend payments head across the ditch. Add to that another $4billion in shared service charges, intergroup interest charges, management fees and royalties.
Wheeler trying to play catch up and trying not to allow the OCR to get too far out of whack with real interest rates. 

1. America will want its

1. America will want its money back, plus interest.
2. Australian Banks will want your money back, plus interest.
3. British Banks, will want your money back, plus interest.
4. Hong Kong banks, will want your money back with interest.
5. Failing that, they will want yer farms, rentals, businesses back as a matter of interest and put in the receiver.
6. Realestate agents will make a killing either way.
7. I will continue to prosper due to my interest, in economics, not what theorists say.
8. A derivative will be remembered well into the New Year, well into the next millenium, as wars will be fought over the principle and the principal. They do not care about the interest, anymore.
9. Finally, A politician will be found, that does not lie.
I believe this will be a first and the miracle will start a new religion, probably called  MAMAONOMICS.
They will have a Dot.com site, already set-up  Len will be pastor, Destiny Chrurch will be defunct, you will be able to download more miracles.
 
 

40 % of the democratic

40 % of the democratic countries in the world will have general elections in 2014 !
 
... and in the undemocratic countries , those who do bother to have polls , 100 % of the Generals will be " elected " ..

Maybe we have found an

Maybe we have found an "honest' politician after all.
One who can save his country and his filching from .........himself.
http://www.thenewamerican.com/world-news/europe/item/17286-putin-vows-to-destroy-terrorists-after-bombings
In genreal, maybe there is no such thing as terrorism. Maybe it is all home made.
A mere distraction, what is a few mere mortals to our " Dear Leader".

Putin Orders Saudi

Putin Orders Saudi Arabia “Destroyed” After Volgograd Terror Strikes
http://www.whatdoesitmean.com/index1728.htm
 
As-Safir said Prince Bandar pledged to safeguard Russia’s naval base in Syria if the Assad regime is toppled, but he also hinted at Chechen terrorist attacks on Russia’s Winter Olympics in Sochi if there is no accord. “I can give you a guarantee to protect the Winter Olympics next year. The Chechen groups that threaten the security of the games are controlled by us,” he allegedly said.
Prince Bandar went on to say that Chechens operating in Syria were a pressure tool that could be switched on an off. “These groups do not scare us. We use them in the face of the Syrian regime but they will have no role in Syria’s political future.”
 
http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/10266957/Saudis-offer-Russia-secret-oil-deal-if-it-drops-Syria.html
 
 
 
 

2014 will see Bank of

2014 will see Bank of Scotland restructure its Australian office shrinking from 7 levels of office building space to a single level, moving most of the staff to Singapore unable to crack the Aussie big 4 stranglehold, not realising that the big 4 has cashcow operations in NZ backing their liquidity and the trick to having a successful Australian operation is to have a  New Zealand office with extensive retail banking to cream the innocent NZ public and a commerce commission with glazed over eyesight ie dumb and blind.

Forecast 2014  - one or two

Forecast 2014  - one or two posters will add some creditability to their comments on interest rates by understanding how they work, and banking profits by quoting specifics profitability matrixs etc such that they may educate a few of us rather than bore -  Hey we all live in hope.

I say, steady on there young

I say, steady on there young man. We don't want any of those fancy profitability matrices here,  thank you very much. This site is purely for the purposes of idle speculation, light hearted banter and pontification. Surely you know that?

I'm sorry Roger, apologies,

I'm sorry Roger, apologies, it's the new pills I'm taking before coming on here - admittedly they do taste sugar coated and likely will prove to be a placebo.

Yes yes quite right there

Yes yes quite right there Roger, we have not the time to troll the enless permutations of the Fractional reserve  diddle.
 While I hold Grant A in the utmost respect I suggest he leaves Stephen Humle and the Bond vigilanties to walk us through the imponderables.
And so to 2014 predictions.....
(1) Er..I'll disagree with GBH and say the Lab Green alliance will sneak home with a treacherous bastard in tow. 
(2)Wheeler will announce the first increase to the OCR by March 31, and begin a campaign to spotlight N.Z.'s private debt levels as reaching unsustainable proportions, given that most people deemed employed are in fact working part time, job sharing or rolling over on work experience schemes at 35 years old with mortgages they are stuggling to meet.
 (3) Fonterra will announce carry forward losses  on hedging mid year to Sept reducing the payout notabley.
(4) small and Medium Dairy operations will be placed under financial strain by their bankers to sell out point.
(5) Olly N will continue the  "ya can't go wron with property Mate" even after you can, Big Daddy will continue the sycophantic accolades toward Olly's prognostications.
(6)Peter Dunne will be exposed as a cross dresser,  floor crosser, doublecrosser, and general lunch tab claimaint at the political trough....gone by November.
(7)Len Brown will change his wardrobe for much bigger suits , so he can appear more humbled by his unfortunate couch experience.......but will remain thanks to crony compadres.
(8)Kim dot.Com will beat the extradition order and go on to embarrass the P.M  for openly lying  about his level of brief on the when and whatfors.
(9)Winstone will realize there are vast numers of aged Asians he 's not yet tapped into providing him with a survival conundrum.  I should think a visit to the ADHB's will give him some perspective.
(10) N.Z.  will enjoy the departure of one of the most dipicable contemptuous representitives the house of Parliment has known as soon as the judge does the right thing.
11, 12 ,13  The USD will make a miraculous comeback by Nov 14, The Boj will take some of the most drastic action during this year not seen in the last twenty.
China will have cause to regret picking a fight with Japan as will the Global economies.
Line in the sand , China want to push it.... trade embargos by alliance groups are prepared and ready to destabilise their ( China's) export monopolies.....(for the greater good of course.)
 Oh and yes the bloody German can is full of worms running out of wriggle.
TPP will become the American dream and backdoor  to re-establish American Market dominance.....Five Eyes, will have a wonky one in kalidescope.
 On the Bright side.....this will continue to be a site of considerable intellectual rank , if all the property pushers bugger off long enough to ge a thread going about not buying houses.
Yay  !!

Oh and did I mention

Oh and did I mention decoupling by the banks in order to bolster their flagging investorship
 We I mean it's all OBR init.......so no harm done right...and Wheeler becomes Bolly incarnate....that utopia of Reserve Bank Goverors...benign insignificance.
.

Look at the flak the banks in

Look at the flak the banks in OZ took over de-coupling, or not dropping fast enough.
Im sure they'd love to break away.....but the PR disaster....ouch.
regards

1/  NZ and in

1/  NZ and in particular....auckland Real Estate will have a good yr. ( the economy is about to move into 2nd gear )
2/ Maybe even rents will go up in Auckland.
3/ New house starts will show an increase... but not enough
4/ Affordable housing might be the political issue for the next election
5/ Nz economy will have strong GDP growth 
6/ Reserve bank will start raising OCR in small incremants... Lots of pressure on them ,in election yr, to be very slow and cautious... ( thou Wheeler looks to be his own man )
7/ $nz will strengthen against both $AU and $US
8/ USA stock mkt will have a correction... maybe a scary one.
9/ Fukushima will make front page news again
10 National might scrape back in on the back of a strong economy.
11/ There will be strong foreign investment in NZ 
12/ Oil prices will stay up there...   ( middle east tensions etc)
We will have the feedback loop of inflationary pressure.....  Reserve Bank pressure to raise interest rates.....  strengthening dollar....  strong inflation in asset prices....which equals a bad headache for the Reserve Bank.
 

Agreed. Auckland Property

Agreed. Auckland Property will have a strong 2014 performance.
1. The big boys, Fletcher Construction and Todd Developments will continue to acquire large chunks of land ahead of the Unitary Plan. Adjoining properties to land already acquired by Fletcher and Todd will be prime targets for acquisition and they will pay premium prices.
2. Neighbours will acquire neighbouring properties to get to the magic 1200sqm to allow for multilevel multiunit development sites under the Unitary Plan, in the 10 metropolitan cities that allow for 18 levels of highrise. Land accumulation will be at the forefront as neighbours and the big boys jostle for a piece of the action.
3. Cheap offshore funding will continue to flood the market with new migrants tapping their networks to get into the rising Auckland property market. Barfoot and thompson real estate agents will announce their top 20 performers and they will have asian origins.
4. Expect another 90,000 new migrants in 2014 and a net immigration of 30,000 as departures dwindle and overseas kiwis return from Oz and Europe. National will open the floodgates, as a desperate government tries to garner the numbers to stay in government and will scrape through to hold power as voters vote with their full wallets. Wheeler will hold the OCR at 2.5% until National scrapes through.

9/ Fukushima is making

9/ Fukushima is making international news at the moment with the "Yakusa involved in cleanup contracts getting homeless people to do radioactive cleanup for below minimum wage and pocketing the difference in middleman fees".
The unexplained steam coming occasionally from the remains of reactor 3 at the moment is probably rainwater getting in rather than the fuel remains buring through the containment.

  This year will see the

 

This year will see the death of local government as we have always known it (or, at least, believed it to be). We will also see Len Brown's back (now there is a gruesome thought).

 

 

As of today 35% of NZ's population live in unitary council areas: Auckland, Nelson, Tasman,  Marlborough and Gisborne. Northland has the nod to amalgamate, Hawkes Bay is well under way and Wellington is in the early skirmish phase. 2014 should see another couple of regions jump on the bandwagon. Manawatu-Wanganui is an obvious candidate given how unpopular Horizons made itself recently. Taranaki and Waikato are both good candidates. The end game is 10-12 councils total and the end of independent regional councils. It won't happen this year but we will hit the tipping point.

 

 

Len Brown's resignation is a close call but I believe he will go and that it will be about the perks of office not moral turpitude. In a nutshell Len has had to set the bar higher than he can jump just to justify sticking to his post. Now that the wider community knows him for the lightweight he is he will not be able to fake his way through the rest of his term. Even the Auckland mayor has little constitutional power so the effectiveness of the incumbent depends on their personal qualities and genuine leadership. Len has lost all his political capital and would have to make it on personal qualities he just doesn't have. It will take him a long time to face reality but by the end of this year he will have no choice.

 

 

Otherwise I don't see LG being overly topical this year. Affordable Cty made no impact in the local body elections so there is little point in political parties giving that moribund equine another flogging during the national elections.

 

Disagree, Len Brown will not

Disagree, Len Brown will not give up his 3 years and his $1million wage as he moves towards retirement from the public scene. Alternative positions in the private sector will also be limited by the stigma of his extramarital affair. He will continue to hold power as he will not have an alternative option available to him.

It's a pretty close call. I

It's a pretty close call. I agree Len doesn't want to go and no-one can make him now. But what Len faces this year is is day after day of sitting in meetings where he has no respect personally and where the mayoralty has no respect. Meetings that used to be friendly and pleasant will become stiff and formal. The standard obsequiousness that Len got just because of his job title will disappear. Political factions on the council, even his own supporters, will do their own thing and ignore him. Invitations to attend openings and other events will dry up. Len will find this atmosphere corrosive; it will take him a while but he will accept reality eventually and want to give it away. Especially if his marriage breaks down.
 
I suspect the Nats would want to help Len find a new job. Auckland is the prime electoral prize and the Nats need all the help they can get given the CHC support that will melt away this year. The Super City is the Nats only visible LG policy "achievement" and if you are really honest there is nothing to show yet for 5 years of planning and operating the merged entity. John Key doesn't want to go into the election with their version of Auckland being known only for a chronic shortage of housing and a buffoon for a mayor. There are a zillion sinecures for mates of the government on the Local Government Commission etc. What about the Family Commission? So finding Len a job is no problem. If they do decide to oil the hinges of the door marked "Exit" it will happen quickly.

I'm with you on the he'll

I'm with you on the he'll keep raking in the ratepayers cash, but the alternative positions won't be a big deal , give the media a couple of months to grab some new scandal and it'll be water under the bridge.

Things will get exciting as

Things will get exciting as popular economist opinions and shortrange crystal ball gazing by the bankers will see the US wean off the QE teat too early, having still not established any actual support or real value underlying their "Growth".  This will form the basis of the Ellison Wave, I haven't bothered to look if this is 2 or 3 step.

This will cause "inflation" to appear from rising cost of foreign money, banks adjusting themselves and passing themselves to the captive market and thus their customers passing on interest costs (especially in 2 - 5yr bracket), cost of imports going up.  The flow on from the 15% gst and minimum wage rising orgy will also make themselves felt as higher prices and illusions of higher income; this will cause RBNZ to go to 3.5% and really tank any poor bugger with debt.

On the plus side, Chinese bureaucrats will continue to stockpile warehouses full of WMP like it's going out of fashion, for the whole year, having not yet fulled the quota written in their orders.  This will offset some of the damage from exchange rate (which I'm putting aside enough in casewe hit a 96c peak)

The rich will get richer,the

The rich will get richer,the poor will have more kids,iwill be made redundant midyear and i probably won't find employment until i retire.

Then start looking for

Then start looking for something else to do now?  I faced that in my 40s.  I retrained in IT, never looked back.
Best of luck.
regards

Iam already going down that

Iam already going down that pathSteven but what i have found is that in my late fifties i find it harder to retain knowledge so at this stage i am looking at the possibility of self employment .

Go to Christchurch or

Go to Christchurch or Auckland, Plenty of jobs on offer. Short of people to get the jobs done. May have to be able to use a hammer and a saw though.

In his late 50s? doing hard

In his late 50s? doing hard physical work?
hrmmm
regards

NG, you can go online and

NG, you can go online and register yourself as a RFA(Registered Financial Adviser). No study required, and you get professional letters attached to your name. Just spend enough time here at interest.co.nz and you can start charging for dispensing wholesale and generic advise. 

That's interesting, a techie

That's interesting, a techie that does not believe that technology would solve peak oil problems ahead? The US have shown that a new technology ie fracking has gone a big way to solving its energy independence. Even the big power retailers acknowledge that solar is a becoming a viable competitor, promising more competitive electricity pricing rather than price themselves into oblivion. My own personal electricity power usage is at a trigger point. Whilst electricity remain at current prices it is still cheaper to use conventional power companies. But any higher and I go solar. Free power to the people. Green Party and Russell Norman, do your jobs, sell those power companies and use the proceeds to subsidise free solar power to the people in 2014.

Ha de haaaaaaa ! .... good

Ha de haaaaaaa ! .... good one Mr Z.z. ... and a happy New Year to you ....
 
... in Amanda Morrall's absence , we are sorely missing the sagacious advice which NG requires ....
 
But one thing I would say ( having found me Gummy self in similar circumstances ) , is to not subtract 65 from your current age , and think that is the total of years you have left as a " productive " member of the economy [ no offence meant to those outside the productive sector ] ... take 85 , say , from your late 50's age , and figure on a quarter century to go of " working " ... which means plenty of time and good reason to continue learning / re-training / up-skilling ....
 
... the most interesting , useful & fun stuff I've learnt has been since leaving the formalised state education system .... Good luck NG , and happy new year to you , too ...

Happy New Year to you as well

Happy New Year to you as well GBH.

Hi, Yes, I dont do belief, I

Hi,
Yes, I dont do belief, I dont pray for solutions, I make them. I do engineering, math and science and enough that I know technology is not going to solve these problems on the EROEI, scale and time frame left, let alone the actual problem.
Yes, note we are talking peak oil and not peak gas.  Now US shale gas there would seem to be quite a few years, shale oil, not reall.  a) Take a look at the US's projections for output, a peak in 2016 then a trial off...and to do that they are investing huge amounts in drilling new wells, its not sustainable.  b) The energy cost to get it to the state as a feedstock its fit to be turned into petrol etc.
Big power retailers, again that isnt transport power and in the US for instance its still heavily subsidised, mind you so is US oil and gas.
Finally, selling the power companies and giving handouts/subsidies so the middle classes can install solar makes no sense economically or socially, as the poor pay to install your system, so no.
regards
 

Steven I have a math

Steven I have a math challenge for you to solve in 2014.
 
Life reproduces exponentially. One single cell organism splits and becomes two. They split and become four and so on. Life consumes resources. Life is earthbound and the earth has a limited amount of resources.
 
Explain using just maths not biology, history, economics or the other lesser forms of knowledge how life continues to exist on the earth 3.5 billion years later.

??? So what's the point of

???
So what's the point of this challenge?  Because from what's there, it's completely pointless and stupid.
You are aware that organisms also die, at varying rates, and their component matter recycled,  right?  Right??

Because if some species can

Because if some species can survive their reproductive exponential growth function then it is possible for humans too. Steven argues he has superior knowledge of these matters because of his physics/maths background. But it seems to me that you also need an understanding of biology, ecology, history etc to make a really informative analysis of this issue.

The maths is a tool used in

The maths is a tool used in the ecology. 
It is possible for some organisms to survive exponential growth therefore humans can is a fallacy.  Does not follow. 
Your challenge is idiotic from every direction.

Yep. If we applied our

Yep.
If we applied our intelect then, yes it should be possible to stop growing "calmly'  and plateau...trouble is most dont want to or dont yet realise they have to, and I think too many wont.
regards

Except, mathematically we can

Except, mathematically we can see that expotential growth gives a doubling time of which the last doubling fills or uses up 1/2 the resources.   So we dont need to model it all just identify the critical item / timeline that sets the limit, all else is moot.
So fossil fuel use is that limit.  Consider its all gone by 2050 but to get to 0 we dont have an output of 72mbpd 1 day and the next 0, we see a decline.  This has been well modeled in say coal use in the UK, it peaked in about 1913 and despite efforts of WW1  and 70 years it declined to zero.
Take a look at the Oil output of the USA and how it peaked in 1970 (ish) finding and puting alaska on stream give a wee hump...until that also declined.    Right now we see shale drilling that will do the same.
We as humans could survive our reproductive decline if we chose to, all we'd have to do is have 1 child,  per couple however religion, culture, taboo, politics all mean its looking very un-likely.  Sad as we have the brains.
PS Maths, all you have to do is go look at limits to growth and its revisit, its all there modelled already, looks pretty ugly.
regards

steven. If you are going to

steven. If you are going to argue stats try and be accurate. The UK has massive reserves of coal (c 3 thousand million tons) they just, foolishly, choose to import (40 m tons per an v 16 m domestic). It took and olde plonker like me about 4 minutes to find these official figures.
NZ has thousands of years known supply of coal - that we, foolishly, choose not to dig up either.
Ergophobia 

http://www.forbes.com/sites/w

http://www.forbes.com/sites/williampentland/2011/09/07/u-s-called-king-o...
Have a look at that production graph.
in fact its a good piece....
Answer me this, if there was so much coal, why has the production dropped since 1913?
Surely during WW1 when 1 in 10? enlisted men was sent down the mines did the coal production not rocket?
Have a look at 1994 when the mines were privitised, great increase in production eh?
Now lets say indeed the coal left is capable of being extracted, why doesnt it make sense to use cheap polish caol and leave the coal in the ground for when its scarece and hence costs more?
Do you understand EROEI?
Then consider the coal grade....steam coal was/is the best and lignite or brown coal the worst....
These days Solid energy was looking at our south island lignite reserves which are the boottom of the barrel....the dregs....
Why didnt that go ahead?
regards
 
 
 

(1) it's not a closed system,

(1) it's not a closed system, for the duration of observation energy input from solar, gravity and nuclear forces can been pouring in

(2) recycling.  (you up for some solent green then?)

cowboy, exactly right. The

cowboy, exactly right. The Earth itself is an energy producer. The rotation of the Earths metal core creates a magnetic energy field. That magnetic energy field protects the Earth from the solar flares and damaging radioactive particles gets deflected by this energy field.

Hmm, what a silly Q.  To

Hmm, what a silly Q.  To start with the expotential function relates to doubling time use of resources, therefore doing some math for what you want isnt solving the relevent question. If you want to do it, fine as,
We actually have numerious examples in biology/history of a species growing expotentially and once the resource it relies on is consumes it collapses.
So the Q in terms of a society of just math?  doesnt exist as we cant even model the world's economy let alone anything else thats part of that Q.
For the math we dont need to model it mathematically and it simply doesnt matter, for you to think so is, well astounding.
 
regards
 
 
 

What a silly Q.... For the

What a silly Q.... For the maths we dont need to model it mathematically... WTF. Did you even try to answer the question or just write before thinking.

I did answer it.  I cant help

I did answer it.  I cant help it if you you are having a silly troll moment or cant see you dont need to model it in that detail or that even you would understand what I modelled for you even if I could....and frankly I suspect a bunch of PhDs would struggle to do what you ask.
The point is to break it down and model the important part, nothing more is needed to figure out the ourtcome.
So,
Our society and popualtion numbers need this economy and it has to grow. To grow it needs cheap fossil (transport) fuels, therefore if we cant grow that fossil fuel output cheaply or even at any price we can see that the economy will stop growing and shrink and therefore also our society and population.
That growth ratio seems to be 4% economic growth needs 2.5% more crude oil. We have been on an output plateau for 5~6 years and oh look our econmy has stagnated for that time period expect for the growth in debt.
Take away that debt expansion and where will our economy go?
regards
 
 

Well Brendon, population

Well Brendon, population ecology does talk a whole lot about carrying capacity of a species in a particular place. 
For humans, take our particular place to be planet Earth.  For most of human history, human population was low and reasonably stable world-wide (ie at our carrying capacity).  Then we starting digging things out of the ground ... metals, coal, and most importantly, oil... resources which have allowed human populations and resource/energy usage to increase massively  - far far above what our human carrying capacity would have been if we did not have those resources.
Steven reckons that those resources are increasingly under pressure, and I agree with him.  And guess what happens when (and it's when, not if) resources deplete - well then it turns out that the human predicament will be no different from any other species that has prospered under a windfall and finite resource.  ie the earth's carrying capacity for humans will decline... and that's when you get into the economic and social implications, not nice. 
Steven is right... go to the science and the answers are there.    
 

Brendon , you seem to miss

Brendon , you seem to miss the point, as we expotentially grow in number we in turn displace , consume , into extinction all before us accidentally or otherwise.
As we clear land to feed the expotential growth , and remember that in itself is underwritten by consumption of energy resource, we  begin the process of our own extinction whether complete  or reduced to a level  where the resilliance of supply might support us albeit in an altered fashion to life in mass consumption as we know it today.
3.5Billion years Brendon has seen a lot of extinction, some by catastrauphic event , some by consumption of upchain predatory , some by displacement from environment to where their species can no longer survive .
 The one thing you can count on is we are the only species that does not self moderate to suit supply and demand needs because we somehow picture ourselves above all before us in a Godlike manner, and yet our unchecked proliferation is destined for  supply problems of biblical proportions.
 We in our short tenure have done more to change the earth you speak of, have done more to cause the extinction of so many species, have taken and  consumed all before us with an indifference for those who may one day  be in need of it.
 Look about your home , your yard , your town , give it some thought.
We the species in the name of divinty are our own worst enemy .
 Question for you ...what do you suppose would be the observations about us from those that follow us, assuming they are capable....? headshaking shit, or do you believe ..we...are ...infinite.

I am pretty sure I have

I am pretty sure I have pointed out to Brendon before that the numbers show we are already past the sustainability point population wise, we hit that 50 years ago when the rate of growth of the world population turned negative. Pointless debate when that fact is in front of you but I suspect it is just a wind up for Steven.
 
Good post there Count.

Ok maybe I was being a bit

Ok maybe I was being a bit troll like. But I think we have establish the problem is more than just exponential maths related to one growth variable. It is also the function of depletion of non renewable resources which if cannot be replaced will cause overshoot.
 
It seems some species if they survive extinct events like climate change and predation can stabalise their exponential reproductive growth function before they exceed their carrying capacity.
 
What is humans carry capacity and is it the same as in hunter gathering times when we last had a stable population. Can we stablise our exponential growth and stop depleting non-renewable resources before we exceed our carrying capacity?
 
Most of the above commentors predict not. But I think there are so many factors that no one can be certain of the outcome.  It is the certainty of some of you above that started my whole troll like questions.
 
Scarfie I know you are an intelligent chap, but sorry that comment went over my head. Could you explain it in more detail. I am not trying to be difficult or argumentative I genuinely don't get it.

Most organisms will continue

Most organisms will continue to reproduce until they are limited by physical constraints. The balance you speak of is usually the result of a species being constrained either by lack of further energy to fuel reproduction, or balanced a predator-prey relationship (which again is subject to food availability vs reproduction). Essentially every organism when supplied with surplus energy will reproduce until they hit a physical limit, overshoot this limit and then die-back to the carrying capacity. Reproduction is an innate biological imperative.

The carrying capacity of Earth is subject to resource availabilty. Scientists have estimated the upper limit of long-term (sustainable) carrying capacity of earth to be somewhere between 0.5-2 billion. Humans have obviously shot past this limit in the last few centuries due to having learned to harness exogenous energy sources (fossil fuels) and used them to produce more food then would otherwise be possible. Industrial agriculture is massively energy intensive. In this respect we are already well into overshoot and as these fuels decline over the coming century (coupled with ongoing population growth) there will be more and more pressure on food price and availabilty. Are humans smarter than yeast? From where I sit I think the answer is 'probably not'.

Well we could be smarter than

Well we could be smarter than yeast if we tried, but when the shakedown comes the smart money would be on the yeast surviving where the humans may well not

Well this may not be eloquent

Well this may not be eloquent as I have other things to move on to, but I will give it a bash.
 
A good question to ask could be at what point in an exponential growth scenario do you get to past the point of no return? I would propose that the Seneca Curve (very similar to the Hubbert Peak) is an appropriate way to graph or model growth effects. But the way in business modelling you will find the Seneca Curve called the Sigmoid Curve and the same principle as to when to recognise a problem applies.
 
So the question might be better phrased: where on the Seneca Curve is the sustainability point reached, or if overshoot occurs then where will it fall back to?
 
The utilisation of denser forms of energy, first coal then oil, has resulted in exponential growth of the popularion. But not just exponential, for over 200 years the rate of growth increased year on year without any real pause. Rate of growth being the key as opposed to absolute growth. The increasing rate of growth is what gives you a hockey stick front side to the Seneca Curse.
 
The important indicator in my mind is when that rate of growth turns negative, that is from increasing year on year to decreasing year on year. In terms of the Seneca Curse it become mathematically an inflection point. You could say that the growth phase has now entered a peaking phase as eventualy in a decreasing rate of growth scenario we will hit zero and after that negative growth will occur.
 
In world population terms that inflection point was around 1961. The good graphs that were around when I worked this out for myself have now disappeared from the internet. Every year since 1961 the rate of growth of population has declined, althoug absolute growth still increases but just as a slower and slower rate.
 
So draw youself a Senca curve on top of a world population graph and tell me what you see. I see that the time to act was 50 years ago and in fact even 50 years ago was too late. 1961 wasn't peak oil but I would put good sums of money on the fact it was peak EROI. Quality is already past its peak and quantity will eventually follow.

Thanks Scarfie I think I

Thanks Scarfie I think I understand it now.
 
Belich in "Replenising the Earth -The Settler revolution and the Rise of the Anglo-world, 1783 -1939" found that booms in populations and the rise in new mega urban areas such as Chicago and Melbourne , London and New York did not correspond to the various break throughs and new energy forms of the industrial and agricultural revolutions. It was more of a cultural event based around waves of boom mania followed by a resource export bust recovery.
 
But it is debatable what causes the boom and how we will survive the bust...

Brendon sometimes it pays to

Brendon sometimes it pays to note who you are discussing with to help you evaluate the veracity or integrety of their position. I have introduced MBTI to these forums on the odd occasion as it is a very useful tool to understand how people think and even predict behaviour. MBTI is also correlated with temperament.
 
I tend to give greater weight to the Rationals, so described because the Intuition combined with thinking gives the greatest ability to form a rational and logical argument. There are a disproportionate number of rationals on this forum but this is matched by a disproportional number of Guardian types. I recommend you read up the type description for fellow INTP's and INTJ's such as I know/suspect: Plutocracy, Kakapo, Justice, Count Christov, Steven, PDK, Iconoclast,  Stephen Hulme. Alter Ego is likely an ENTP so include him/her. There will be others but ENTJ's are like too busy to bother with a forum like this.
 

Aaaaaah, but how many of

Aaaaaah, but how many of those have you verified?  Can't just assume based on what they've written here.
As it happens I'm on the borderline between INTP/INTJ, so you've got that right.  But then I could be lying about that.  I see no reason why you should just take my word for it. 
Also, skepticism about any system based on taking a complex continuum and dividing it into discrete categories, blah blah blah.

Lol. Nothing is ever certain

Lol. Nothing is ever certain but the best application for MBTI is careers advice. Not what to do but more eliminating careers that are unsuitable. The caution is you have to know what you are measuring/evaluation to understand the strengths and limitations. Rational types usually identify themselves by what they do or say but a couple of those mentioned have confirmed with me by private correspondence.
 
Jung and Myers-Briggs were INTP's :-)
 
I have a suspicion that pschological disorders are a manifestation, or dominance, of the negative aspect of each type. Totally speculation though.
 
If you tie it in with lesser known and respected tools such as the Guilford Model of Intelligence and nine types of intelligence or even enneagrams then a more complex but useful picture occurs.

I've long suspected that we

I've long suspected that we have a background in the same organisation.

Very interesting, we all make

Very interesting, we all make judgements of others and the use of various tools/conceptual models can help. Not sure what that has to do about my reference to James Belich's book. What cateogory are historians put into?
 
I think Belich's argument that the Anglo's population/urban booms are cultural events is a interesting idea that might help us look at our current problems. He desribes ponzi land sale schemes where earlier settlers gain from inducing more settlers coming, boosterism advertising -the land of milk and honey, where crops grow to double the size, chain migrations etc. I think it was Roger Witherspoon? saying there still is this effect in Nelson. What does the top 20 Auckland realestate agents being Chinese/Asain mean? Is Bigdaddy a modern version of those 19th century land and migration boosters?
 
Note this analysis doesn't discount the booms being unsustainable for lots of reasons, including environmental ones. But just makes the analysis more nuanced.
 
If New Zealand is stuck in this economic model of two modes -migration booms and resource export bust recoveries. How do we get out of it.
 
I would suggest we need to stop exporting our young and replacing them new 'higher capital value' migrants. To do that we need affordable housing, more investment on local infrastructure, vocational education focused on local needs not the global marketplace, a clampdown on migration and foreign investment in property etc.

Sorry Brendon my response was

Sorry Brendon my response was not in direct relation to your post but just a general comment that I think is relevant to the article heading up this thread or to Interest.co in general.
 
I haven't read Belich although did watch the TV series on The New Zealand Wars. I also saw critique at the time on the the series an the conclusions it reached.
 
My immediate response to any reliance on Belich is that he field of expertise is very narrow and that just because he is an academic does not make his proposals or theories accurate. I can't comment on his growth theory but with what I know now would say someone like one time resident of these forums (he was kicked but continues his work on facebook and his blog) Iain Parker. Belich would argue the Maori wars were in some part won by Maori, or the result at least a stalemate. Iain has tracked the way Maori lost to the bankers and the Crown in that did not reverse the loss of land to the crown, a right obtained by the Crown under the treaty. Off the point though.
 
But remember all growth has to be supported by energy (food is energy). Without putting a great deal of analysis into it I would comment that Melbourne, New York and Chicago were transport hubs and thus highly interconnected. I don't think they can be viewed accurately in isolation.
 
This is a very general series of statments that give a macro perspective to your housing question. Unaffordable housing is a one way trip. Three quarters of New Zealand currency is issued into circulation as lending on residential housing (RBNZ figures). To make housing affordable you have to break the money supply, or the money supply has to break. There is no other permanent answer, just tweaking at the fringes and perhaps temporary alleviation of the symptoms. New Zealand can't exit the international money system unless we first have energy independence. We import 50% of our energy requirements via oil.
 
If you want to solve the housing problem solve the energy problem first :-)

Scarfie the Maori wars TV

Scarfie the Maori wars TV series was based on James Belich 1979 Doctoral thesis. He went on to study colonial societies. He has written a two-volume work A History of the New Zealanders, consisting of Making Peoples (1996) and Paradise Reforged (2001).  He expanded his area of research to colonial societies in general with Replenishing the earth (2009).
 
His work is highly sourced. I have my own interpretation of his work, but it is probably best to read his books, they are highly readable and make your own conclusions.
 
I see energy as one of the constraints on growth. Imagine a production possibility field with a series of less than constraint functions, with energy being one of these. And then a maximising function determining where in the field to produce. So energy limits growth but not all growth is limited by energy, other constraints have kicked in first.  
 
For instance in my area of work psychiatric medications have gradually improved over the last 15 years of my working life. The limits to this is more about how medical research is structured globally rather than energy input.
 
 

 

Yes, my way of looking at

Yes, my way of looking at things economic is that there are a number of positive and negative feedback processes going on. If the positive feedback processes dominate then a trend emerges which continues until a constraint is reached. Then, following a trendless period, the negative feedback processes take over for a while, these return the activity to a mean but also let loose a number of positive feedback processes that carry the activity past the mean towards the opposite extreme. The thing is that you don't usually know exactly what these processes are until sometime later.
 
 

Energy is the feedstock for

Energy is the feedstock for everything. By its very definition energy is the ability to do WORK. Work = feed, build, produce etc). Nothing happens without work (energy). I cannot stress this enough - energy underpins everything. Our modern and complex society functions due to a large surplus energy supply.

Of course the main ingredient for providing this energy has been the fossil fuels (otherwise known as stumbling upon half-a-billions years worth of stored solar energy). We have entered a phase where the RATE of energy we have available has stagnated (and will likely decline rather than grow). Whether this plays out of 5 years or 10 years is irrelevant, the data currently suggests energy contraction in the not-too-distant future. People from all over the world will be doing what they can to accumulate resources (real / tangible) over the coming years.

NZ really needs to get it's s*** together and consider the long-game for once!

I introduce MBTI in an effort

I introduce MBTI in an effort to get non-rational types some kind of insight into the clarity with a rational can see the big picture.

Hi Scarfie, I cannot resist,

Hi Scarfie,
I cannot resist, but then, why would I?...it is all debatable.
Unfortunately economics, is being manipulated, so  having an opinion, is actually pissing in the wind, because we do not have any control over the levers being pulled, pushed, by the vested interests and the hidden agendas, being dished out today.
Being a party to it, is surely insanity. 
In response to your observations, we are not only spied on by the NSA, etc, we are apparently should be psychologically evaluated by the masses, who read more into what we write, then may agree or disagree with our point of view.
I hope they know better, when they vote.
Now, if only you could give a sane response about our Political masters, maybe evalutate them, I would be delighted to hear more.
I would love to be a fly on the wall at some of the meetings that have taken place in the past to evaluate our discussions, should they actually read this blog.
Do you advise them, or do you revile them. Do you care, what they do and think.
Seriously, I would like to know?.
Or am I just nuts.

You make more sense than most

You make more sense than most around here Alter Ego. I desribed politicians and the political process to someone not so long back. Politician: A stupid person whose full time job is the convince people more stupid than them (most people) that they know how to run their lives better. We don't stand a chance really.
 
This song by Kora seems to have it nailed down.
 
Or perhaps these MBTI descriptions are more your style, I think you will see the political process described well in amongst that.
 
Oh and I craft brew my own beer so I can work on becoming accomplished at pissing into the wind.

Scafie, Thanks for the

Scafie,
Thanks for the links.
I have tried to make sense of the situations facing us all today, but still come up blank.
I shall investigate further.
But as my mother used to  say, 'A little knowledge is a dangerous thing'
Maybe that is why Christchurch should listen to another old adage of mine.
"Woodwork teachers, should not the cabinet make, they should stick to their knitting'
I made it up today.
 
 
 

In terms of mans impact on

In terms of mans impact on the planet, surely looking into behavioural science is going to give some answers. It does for me anyway. MBTI isn't the only tool but still a very useful one. Type behaviour to a particular circumstance can certainly be predicted with some degree of accuracy, how else would manipulative types succeed otherwise?

Count to answer your question

Count to answer your question I do not dislike my culture. I note my Anglo culture went on one of world's biggest growth spurts from the 1800's to mid 1900's. In NZ that meant altering the environment in ways that took 1000s of years in Europe but only 10s of years here. But in recent generations we have calmed down and are making efforts to live within our environmental constraints. Will future generations be shaking their heads at us the 2014 generation? Maybe but if things go pear shape then I think many earlier generations will get the finger pointing treatment before we get it.

Cheers for your thoughts on

Cheers for your thoughts on it Brendon...appreciated.

Christov, the largest

Christov, the largest extinction event wiping out the dinosaurs saw the rise of man. Human history suggests that our history began when the dinosaurs ended, but there are carvings and cave drawings that depict man hunting dinosaurs which would date humans being around during the reign of the dinosaur and existed during the extinction event wiping out the dinosaur. There are suggestions that the Spinx in Egypt predated the pyramids by tens of thousands of years.
Drawings of man and animal dieties in greek mythology, bird men in Indonesia, in Egypt and in Mayan statutes and carvings suggests DNA engineering in our historical past.
I liken humans to cockroaches. We will adapt and we will survive.

.... hang around our inner

.... hang around our inner city streets late at night and you'll meet a few humans who're evolving back into cockroaches .....

On behalf of ZZ, exactly.

On behalf of ZZ, exactly. Humans are like cockroaches and therefore will survive.

Almost god like in your

Almost god like in your belief we are indestructable.
Interesting piece on our origins. Genetically it seems its east africa and genetically it can be traced back to 1 or2(?) women....so we came extremely close to extinction, at least outside east africa.
On top of that we have never been through a super warm period and are living in a time where we are changing and consuming our environment faster than at any other time.  Agriculture will become more and more risky.   At present we use about 40% of the world's surface area to produce food, looking at the UN's la la land prediction for the middle-end of this century we'd use 120% of it...
Then there is the food chain, we are destroying it....what we are not eating out.
Various countries have nukes and enough to poison the entire planet, down to maybe the coackroach.
So really the numbers do not add up for us as a civilisation, now sure we as humans may well survive scraping an existance out, quite possibly in NZ, but what you see here today is peak civilisation.
Alternatively we have the intelligence to not implode our civilisation, but like all those civilisations before us we wont.
regards
 
 

Is not the manner of our

Is not the manner of our survival, or existence, the important issue?

K/T boundary largest

K/T boundary largest extinction event??  Humans hunting dinosaurs???  That's quite the fantasy world you live in. In fact, there is so much hilarious wrong in this that I'm going to have to share it with Fundies Say The Darndest Things.
 

Ummm... ZZ, dinosaurs went

Ummm... ZZ, dinosaurs went extinct 65 million years ago, most commonly believed to be the result of a catastrophic asteroid impact.  Homo sapiens have been around for less than a million years.  If you believe the overwhelming scientifc evidence (and I do), there is no way that they could have inhabited earth at the same time.  Where exactly are those cave drawings that depict humans and dinosaurs together? 

I too would like to see these

I too would like to see these cave paintings.  If they also contain flying saucers I'll hurt myself laughing.
It's like a bizarre hybrid of Erich von Daniken and the drivel from Answers in Genesis. 
 

Kakapo and Young tel, may

Kakapo and Young tel, may seem to be fantasy but hey go watch Ancient Aliens, they have a new series out and the body of evidence ignored by conventional science is rather over whelming.

Oh, you.  Ancient Aliens is

Oh, you. 
Ancient Aliens is fiction designed to appeal to the ignorant and gullible.  Do you also think Bigfoot is real because there's a reality show with a bunch of idiots running around with infrared cameras pretending to hear things rustling in the undergrowth?
You might enjoy America Unearthed, while you're at it.  More made-up ahistorical illogical nonsense than you can shake a stick at.  Watch a couple, have a go at spotting the misleading editing and logical fallacies.  It'll be good practice for you.

Kakapo, actually I have

Kakapo, actually I have watched all of the mentioned. But I particularly enjoy Ancient Aliens as it is providing an alternative explanation to a myriad of actual sculptures, carvings, paintings and scrolls, providing dates and identifying locations and narrated by individuals from different countries with a string of degrees and represented by a number of museums. 

So you managed to watch all

So you managed to watch all that without realising how you were manipulated by the bogus evidence and misleading editing? 
So, about the assertion that the copper used to 'fuel the Bronze Age' was mined in Michigan by the Minoans, great seafaring civilisation that they were?  Were there any tiny logical flaws in that theory that jumped out at you?
 

Kakapo, you brought up

Kakapo, you brought up America Unearthed. I did not.

Well, you said you'd watched

Well, you said you'd watched it.  So I'm curious as to what you made of it.
I'm a fan.  I particularly enjoy the hilarious stupidity, bad acting and pointless speedboat montages.

Not a fan, it did not come

Not a fan, it did not come across very well as I was looking for a specific event of Chinese mega vessels that apparently reached the shores of America but there was no coverage which sort of disappointed. My preference is Ancient Aliens. Recently I have been watching Big History which trys and relate the Universe to the big moments in history but some of the episodes falls over with the credibility issue and does tend to be repetitive.

Oh come on

Oh come on

Zany with respect , you watch

Zany with respect , you watch too many doco historical's edited to prick the interest of Mans Rise. ....many findings are still under intense scrutiny by far more learned than we.
 Please just go back and read what I said without your interpretation of it.
 Do you believe we the speciies are infinite...?  Do you not accept we the species will need to cause more extinction of rescouce and lifeforms to continue our expotential proliferation.
 Do you not think the the role divinity has played in our devlopment through the ages has given the larger portion of global population the right to exist at any cost.
The rise of man is one thing to be studied and admired , the gluttony of modern man while having the free will to choose not to do so is the begining of our demise. 

Well written.   regards

Well written.
 
regards

steven, empires used to

steven, empires used to extend to the limit of how far you can run and that is why the empires of the mayan and the incas were so much smaller than that of the mongol/chinese empires which was biggger due to the discovery of the horse which shortened the communication distances. The horse was so important as a technological advancement that even today we measure our modern vehicles with the equivalent horsepower.
You cannot measure the limits of technology that is yet to be discovered, eg In the horse age you would not be planning your empire on the basis of the discovery of the motor vehicle that run on oil. Therefore your maths can be out of date by a technology advancement. Due to collective learning via the web, human discovery time for new products has been shortened considerably.

Collective learning? Do you

Collective learning? Do you mean learning stuff like man did not land on the moon, that jet planes spread mind altering chemicals, that 9/11 was an inside job, that the Holocaust did not happen, that Elvis is still alive
There are some things that are pretty much self-evident, all of the above other than the Elvis bit, yet people can be convinced they are not.
So much for collective learning then, eh
 

Hi Steven.  I'm a scientist

Hi Steven.  I'm a scientist and also thinking of retraining in IT.  I'm apprehensively looking at the green grass on the other side of the fence at the moment.  I'd relly like to ask you a couple of questions about your experiences.  If you texted me your e-mail address, would I be able to contact you?  My phone number is 0212 954 281  Regards Pat.

1. The Christchurch rebuild

1. The Christchurch rebuild will be slower than expected, no CBD anchor projects will be started let alone finished.
 
2. The slow progress on repairing/replacing earthquake damaged homes will become more apparent as the cosmetic insurance claims have already been fixed and the bigger claims are tied up in multi party disputes.
 
3. House prices continue to inflate on the back of no genuine supply side reforms.
 
4. Housing and private debt levels will be a major election issue.
 
5. The government's books will return to surplus.
 
6. The two main party's election campaign's will be a lolly scramble, but instead of National promising tax cuts to the well off and Labour promising transfer payments to the poor, they will both compete on offering new infrastructure projects to benefit the wider public.
 
7. Labour will narrowly win on the back of a 10,000 vote swing against National based on a poor Christchurch rebuild.
 
8. Steven will not make his own predictions he will just criticise others.
 

Brendon, Yours is the first

Brendon,
Yours is the first serious prediction that I could not find too much fault with.
As I see it they are fighting for three major electoral groups
1.  Christchurch which has deserved much better than it has received and will still be a sore as yet unhealed.
2.   Auckland which may as well be a different country still with only promises and its immigration and housing bubbles unpricked.
3.   The rest who may not matter much as they will split down the middle unless they get inspired by something in the pocket.
 
 
 
The Nats think they can win Auckland with platitudes aplenty, Labour know they can win Auckland by getting their potential voters out.
 

"they will both compete on

"they will both compete on offering new infrastructure projects to benefit the wider public.". Given the small surplus - if they make it - National would either have to promise way into the future or admit that it is OK for governments to borrow for infrastructure - in which case why were asset sales so essential? I think they have backed themselves into a credibility corner which will make it tough to compete in this area. Shame, we are a bit overdue on some spend in this area to up the level of service.

Happy New Year

Happy New Year Kumbel
 
Agreed Labour potentially can win the infrastructure provider battle.
 
If Labour looks like they are winning that argument then National will switch to saying lowering government debt is what got us through the GFC.
 
Of course Labour /Greens could counter that lowering private debt is needed to make NZ safe. But that is complicated and hard to sell to the sheepies.

Be interesting hearing

Be interesting hearing National arguing that lower government debt is what got us through the GFC given the amount of borrowing that has occurred since 2008.  (Also begs the question is the GFC over yet.)

Andrew - I think the

Andrew - I think the statement reflects the fact that, despite the increase in borrowings to cover the Chch earthquake costs,and a desire not to hit the austerity button (or the money printing one as some others did), NZ's debt has remained very modest compared to most of the other majors OECD countries (and has a good chance of running surpluses within the next two years that even the super star Australia won't manage for at least 5 yrs).
 
Because of this, from personal observation of the Chinese and other global CBs buying our debt, NZ's long-term rates have been held at levels far lower than otherwise would have been the case compared with others that could only find those buyers by getting their CBs to print money and buy the debt I.e. They now have a major risk over-hanging their economies that NZ doesn't (well in truth we do indirectly through how they handle it, or mis-handle it as I suspect, but we'd have it hundred times worse if the RBNZ balance sheet was at the 25% of GDP that others are at, or worse).
 

Been away however see the

Been away however see the spin does not go on holiday...so Grant A lets play your game... how much of the 60b increase in debt by the current government relates to Christchurch related EQ expenditure..also please provide source for your assertion.
 

No idea speckles, could find

No idea speckles, could find out (isnt it about $10 bln) but its irrelevant what it's been spent on, the fact is they've spent more than they've earned. English didn't go down the austerity route (we still have pretty much all the entitlements etc that are being cut in many European countries for example) but did avoid big public borrowing fresh spending, and did cut a lot of what was deemed wasteful govt expenditure? Facts are, they kept the debt at a comparatively low level around 35% compared to  90% in the UK, 100% in the US, 127% in Italy and 200% in Japan. What source it's cold hard fact, google it....is its news to you Speckles, although I'm struggling to understand what's controversial about it, it's plain old numbers.

yep no idea have you, net it

yep no idea have you, net it off against the the insurance proceeds by the Government received and we get...you google it.
NZs economic fortunes have been entirely different to the countires you note over this period post GFC yet the rate of change in our debt over that time has increased radically. 
Interesting that you see no need to be accurate on anything except when we talking about bank interest rates and their margins... then we can be uppity demanding sources.
The hypocrisy is striking.
 
 
 

What aspect of what I said

What aspect of what I said are you querying ? What part was I not accurate about ? I just love guys who claim others have no idea and then go on to state nothing specific...what has insurance claims got to do with it...Chch will be rebuild from Govt and private sector investment/spending, and money from insurance claims..what's that got to do with it...address the debt issue please which was what I comment on.
 
Yes all countries were all different situations, one that National had to content with was the massive spending commitments that Labour implemented in its last year or so in a failed attempted to get another term that contributed to that deficit and the increased borrowings - many will claim National failed in not turning those around, others will say with a GFC upon them immediately, the timing to do so was wrong..I agree with the latter but it did mean a growing debt.

Grant A what danger do you

Grant A what danger do you see of NZ's high private debt becoming public debt? In say a financial crisis event like Ireland or Greece had?

Brendon, NZ total household

Brendon, NZ total household debt including consumer credit is $201 billion. Total Housing stock value is $700 billion. As Grant A has indicated, only 30% of households carry any debt. Therefore 70% of NZ households are GFC resilient.,
There is no chance of NZ private debt becoming public debt. NZ private debt is an asset on a banks books and is a saleable asset to another bank. The interest earned from private debt is the banks income stream.
What can become NZ public debt is depositors cash deposits in banks. These are unsecured liabilities on a banks books. NZ cash deposits are around $120billion.
From a financial perspective NZ household debt is actually quite low. Most commercial organisations would carry a higher debt to asset ratio.
Why there are screams of panic is due to household disposible income to service the debt. What these statistics do not factor in is that there are 250,000 property investors that do not rely on their own personal disposible income to service the debt. Nor do the statistics measure the overseas income of new migrants and we have perhaps 300,000 recent migrants over the last 5 years that have likely still have some form of overseas income.
In other words, our statistics is garbage. Garbage in equals garbage out.

Leverage. High LVRs Think

Leverage.
High LVRs
Think Ireland, not blindly praying that it wont fall apart, which you seem to be doing a lot of.
 
regards

No venture no gain. Fear is a

No venture no gain. Fear is a mind killer. Falling apart is a time for action rather than inaction. 

I like your optimistic style

I like your optimistic style , Mr Z.z. .... I'd sooner fall over the cliff with a dream in my heart and a gleam in my eye , than skulk in the dismal safety of a cave with friend steven , nibbling on tofu and wearing a tin-foil hat ....
 
... we're all headed for " Boot Hill " eventually .... may as well shake things up and have some fun before we get there ....

Agreed GBH, Agreed.

Agreed GBH, Agreed.

Yes, think Ireland, Maybe you

Yes, think Ireland,
Maybe you noted Grant's abhorance of the OBR?
regards
 

The difference with Grant A

The difference with Grant A and the rest of us, can be explained by a simple analogy. When there is smoke, most of us would think there is a fire somewhere, do not know where and do not know how big the fire is, but lets think about it and look. With Grant A, when there is smoke he would say, there is smoke but there is no fire, there is only smoke because that is all I see. There cannot be a fire because he cannot see or feel the heat of the fire, therefore only smoke and no fire. He is unable to make the connection.

No I don't think it's the

No I don't think it's the "rest of us" ZZ, I think it's a small group of you. I must say any of my former colleagues of 2005-06 who read your post would be falling over themselves laughing their heads off. Back then I had a "Dr Doom" type reputation and an obvious frustration that they couldn't see the wood for the trees, they just humoured me.
 
Although it's got nothing to do with this thread on debt, let me be clear what I think bearing in mind that no one has any idea of how it will play out. I think that there a good number of  sources of a major crisis sometime in the future that will impact most if not all countries but no guarantee of it. Roger's link of Soro's comments about the China risks is a massive one for NZ. My point on interest rates is that the only thing that is going to stop the RBNZ from hiking rates this year is one of these blowing up and how do you set monetary policy, indeed your own view expoused on here, on the basis that something may happen when you have no idea on timing, no idea from where, and no idea of the extent of the crisis if indeed it does occur ? 
 
NZ's property market is at unsustainably high level (prices 5.5 times disposal income - 7.5 in Akld) and only barely affordable currently because of record lower interest rates that are about to rise barring that crisis...Hugh's the expert there...although only 30% of Kiwis have mortgages a decent percentage of them are highly leveraged and will not stand a say 2% rise over 2yrs if the crisis does not come, but when it's had to CBs have still raised rates, it just means an annoyance to some, (a lot of relief to those living on fixed interest), but terminal for others. That ratio will change and it won't be because of a steep rise in wages. Only 30% of NZers have mortgages but across all debt NZers are highly leveraged (140% of income) which is also sitting at very vunable levels...one of the reasons in my view that any rate hikes will probably not go much higher than the bottom of previous cycles where the RBNZ used to have cut down to (4.50 - 5.50%) in previous recessions ...an indictment of how bad the borrowings have got to for some.
 
So I'll leave you to the fire fighting, the conspiracy theories, the institutional assassination, but please don't confuse me with someone who thinks the world isn't a place full of potential risks.
 
 
 
 
 

Nice post Grant. As I see it

Nice post Grant. As I see it NZ is at stage two in the housing/banking ponzi scheme. That is, we are able to pay the interest at current levels but income is not sufficient to pay down the principal. Stage three is where you have to borrow more in order to pay the interest.
 
A major shock to NZ (think foot and mouth disease or miltary conflict between China and Japan) could push us to stage three but I think it unlikely.
 
More likely we stagnate at stage two with high house prices but income sufficient to pay the interest on the debts. This could go on for years (Japan has managed this for pretty much 25 years).
 
Most likely in my optimistic opinion is we somehow manage to get back to stage one, where income is sufficient to pay interest and principal. Why do I think this is most likely? Well, NZ is a small economy and is socially robust enough to cope with siginificant reform without us all turning on each other. We have proved this in the 1990s and I believe the level of reform required is far less socially disruptive than that period.
 
There will of course be bumps along the way.
 
This article covers the economic philosophy which I believe underpins the way forward - steady reform. Whether John's Key's "Reform at a pace Kiwis can go along with" is fast enough remains to be seen. The danger is you miss the moment to make significant change in, for example, the ridiculous salary levels in the mid and high levels of local and government administration.
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/102944...
 

Roger many thanks for that

Roger many thanks for that link, I found that very interesting. The Chinese have had a multitude of centuries of culture development and periods where they dominated the world in terms of their advancements, yet here they are recognising that they have to change and looking for the the best fit. We have much to learn from them in many areas.

Grant A, the disconnect is

Grant A, the disconnect is not only a gap it is a chasm. The analogy does not even suggest that you are blind to risk. It is that you are blind  to what you cannot do the maths on. You believe you have all the variables covered and your math is accurate. I have no doubts your math is correct but you are clearly missing important variables in your maths. Yes you see the smoke. We all see the smoke but where there is smoke there is usually a fire. Record profits for each and every bank plus transfer priced costs to engineer profits and one of the highest interest rates around the world is the smoke. If there is smoke then there is a fire, ie big rip off going on somewhere. Where is the fire, ie where is the record margins being made and to what extent is the ripoff, ie how big is that fire? I smell smoke but I do not know the industry well enough to identify where your missing variables are but I have no doubts there are also big gaps in your banking expertise.
With respect to your colleagues, they are correct, you can't see the wood for the trees and the Dr Doom label is appropriate.

ZZ - you've been successful.

ZZ - you've been successful. We will never agree on each other's intellect, and this post of yours proves it to me. We have given it a fair shot so I will not debate you on these subjects in future as I note many others don't as well. I will leave you to debate it with your few like-minded  posters or newbies who hopefully will be quicker earners than me. Good luck.

Grant A, not too sure why you

Grant A, not too sure why you have conveniently forgotten the Aussie owned NZ banks tax avoidance to the tune of $1billion that had to be paid to IRD. Also UK banks manipulation of Libor plus 1% or HSBC money laundering. Nothing unusual about banks penchant for greed and pushing the limits of legalities. Like I said if you smell smoke then you can betcha there is a fire somewhere.

Correct Grant A: The irony of

Correct Grant A: The irony of ZZ is, he's an exploiter who desnt enjoying the role of the exploited

It is kind of unusual for me

It is kind of unusual for me to be agreeing with both ZZZ and Grant at the same time, but I think they both have valid points. 
 
The thing I would add to the debt/ house prices discussion is that in every country I have been able to find national figures for (New Year's wish- national level Australia housing stock) debt and housing stock value, the amount house prices increases directly equals the increase in household debt. 
 
Except in New Zealand. Here, the increase in household debt is only a tiny proportion of the amount house prices have increased by. Now, I'm a data guy, but the economists I have run the numbers by agree my maths is fine, so I will stand by this as a genuine observation (for NZ anyone can do the year on year change in the C18 reserve bank household data). Looking at the C18 figures we also need to rule out redirected household surplus or movement of asset classes. 
 
So Grant is right that there is a massive affordability problem and such a deviation is unstable, and ZZ is right there is relatively little household debt as a problem. The thing is that, compared to any standard understanding of of household debt and house prices, the two are very decoupled for New Zealand, because mathematically it is impossible that it is New Zealander's household debt driving house price increases. 
 
A couple of my pet projects for this year are expanding the countries I have data series of total national household debt and total housing stock value for (sidebar, if anyone is familiar enough with various languages to find that data on various countries statistics websites, I'd appreciate it as my google translate assisted ineffective NZ foreign language skills don't cut it in such technical territory). I've also been having a look at the relatively easy to use statistical spacial analysis options in R, and am kind of looking forward to doing a comparison between the 2006 and 2013 censuses on home ownership/ renting in the Auckland region, as it is something there is a lot of debate about and it would be nice to bring some detailed numbers to the arguement.

I have a theory that one of

I have a theory that one of NZ's primary export industries is actually livestyle blocks and new houses to new residents and non residents. It is based on observing Nelson over the last couple of decades but I have not come across any figures on this. Could this explain the discrepancy you speak of?

Roger, no figures I know of

Roger, no figures I know of are collected on this, but I think there is some support for that view in the reasonable correlation between the inverse of direct capital outflow and house prices (this is distinct from banks raising debt and on lending). If you imagine money flowing in and out of country, at times when it clogs up in NZ like cholesterol are times when house prices increase and this is a pretty strong linear relationship. just to be clear, it is not the amount of capital coming in itself, it is the amount not leaving.
 
However, I need to put a big caveat around that- I haven't looked at those numbers for other countries so I don't know how unusual NZ is in that respect.
 
Once the 2013 census meshblock data is out it should be possible to look at some changes at ethnicity and income and household tenure against price changes compared to 2006, and tease out some information through that combination. That would have to be done noting that Australian/ U.S./ U.K./ European influence would largely be invisible as my understanding is they all get aggregated with NZ European/ Pakeha.

My observation is that a new

My observation is that a new resident in Nelson or a kiwi born returning expat will first of all buy an existing house. Having lived in it for a winter they realise it is cold, draughty, damp, impossible to heat properly and generally does not work very well despite the mild winter weather. They then buy a lifestyle block or section and build a modern house with double glazing. I don't think this "export" is captured anywhere but it is a very significant part of the local economy, and has been for decades. They build largely with capital they bring with them.

You are absolutely dead on

You are absolutely dead on with that, and you might like to add that one of newest imports is housing and farmland, as we have to pay the foreign landlords rent in order to use/occupy them

Maybe it goes something like

Maybe it goes something like this:
 
New resident buys desirable property for large sum, eg a cliff top house with stunning views that was built 20 years ago for $500,000 now sells for $3.5 million. This resets the price of all comparable properties in the area (as happened in Golden Bay and Tasman/Mapua/Ruby Bay). The comparable properties' new prices then reset the price of all properties in the category below them. This process cascades until all properties in the region are revalued upwards over a 2-3 year period.
 
This can only happen if:
1 The local economy is adding jobs not losing them (building work for new residents helps here - a positive feedback effect)
2 New supply is restricted (resource consent application and processes also create work - see 1 - another positive feedback process)
3 Credit is readily available so borrowers can borrow more as required to meet the new pricing (again there is a positive feedback effect on jobs in the region as moving house creates a need for all sorts of new stuff, think curtains, carpets, furniture, catching up on deferred maintenance).
 
This is the Nelson/Tasman economy. The net result is more money owed to the Aussie banks and therefore more interest payments going overseas.
 
The political process is paralysed as any party that fails to keep the house price bubble going will get booted out of office. This leaves the central bank to save the day by cutting interest rates, thereby preventing widespread bankruptcy and repossession but also taking all pressure off the political process to find and implement remedies.
 
There you have the Gordian knot of the New Zealand political economy.
 
 
 
 

dh - good luck with the data

dh - good luck with the data hunt, I'd be very keen to see what you come up with as in the end all that counts towards creditability of view is research and analysis.

I'd love to see some real

I'd love to see some real stats instead of all the speculation, especially in Auckland over the 12 months or so. There was an article on this site a few weeks back which contained the latest bank leverage ratios which, interestingly, had declined. Perhaps an indication that bank participation in Auckland's recent property run up has been somewhat limited. This then raises the foreign investment/cash as main driver. Given Auckland's isolated performance v the rest of the country, this argument has some legs. Just need some quality data.

Agree Grant. As you've

Agree Grant. As you've indicated OCR peak this time round may be at the bottom of past cycles. The debt is the issue. The RB may be forced into accepting higher inflation to offset the huge risks rising interest costs will place on our economy.

True Mike, in the end though

True Mike, in the end though the RBNZ will do whatever it feels it needs to do to stay within their mandate, but I think you're right in that the level of debt will mean the economy will be much more sensitive to the rise (plus last time I looked at the RBNZ stats 70% of Kiwi mortgage holders were either floating or fixed less than one year) i.e. they won't have to take it so far.  My only concern is if they misjudge their timing as too late (and therefore higher than otherwise) is as big a mistake for the over-leveraged as is too early. 

I don't go into specifics

I don't go into specifics (often actually I do) for the following reasons:

(1) very few people bother to read them ( TL;DR )

(2) it gives the lazy debaters some detail that they are too lazy to examine properly something to nitpick over
(2a) which then evolves into a fractal iteration, in which I explain so then they find some basic or irrelevant point to nitpick; or they fall back on buzzwords or taught faulty model and refuse to examine their fallacy of "appeal to authority"
(2b) with the result that an entire major branch of the discussion gets further away from the principles involved until all the resulting effort is trying to refute their refutation of my explaination, and that takes us back to (1) and (2).

(3) often third parties, and often lazy ass lurkers who contribute nothing to the development or explaination of the philosophies and discussion, will actually take the ideas present and then utilise them.  Without even acknowledging their source; philosophically, intellectually, or financially.  
 And of those, it's the phillosophical acknowledgement that is most important, as such ideas get passed off as "advances in science" or "new developments in economics or political ideas" and it is assumed that current "experts" came up with them.  But often those "Experts" are said lurkers or even opponents to progress helping no-one but themselves (take a look at Edison vs Tesla for classic example).  As a more recent example, look at some of the "advances" made by DairyNZ - all ideas poached from their levy base - "their" scientists all "research" things that have been used in practice by the farming industry for 10+ years....yet they try to pass themselves off as the groundbreakers and progressors!!    (3a)  Why on earth should we (the unpaid) provide those people with a free ride??
That, Grant, is why you and others don't get "the detail" any more.

Of course all political

Of course all political parties will cheerfully rewrite history (lie) this year and there isn't much we can do about that. But, for what its worth, what got us through the GFC was
(i) China's mad building boom that kept Australia afloat that kept us afloat; and
(ii) the Cullen fund that took some excess money out of the economy and ensured the govt's books were in good shape when the s--t hit.
 
Our memories are so short we forget that National wanted to refund the surplus of ten years ago as a tax break. If they had had their way the GFC would have been much nastier here than it turned out to be.
 
Happy New Year to you too.

Good points, especially agree

Good points, especially agree about China and I wonder what the cooling effect of the recent Aussie slowdown will have on us in 2014. It affects us at so many levels, migration, currency, trade...

... wondering if Gerry

... wondering if Gerry Brownlee will eventually get a knighthood too , for his " services " to the CHCH re-build ?
 
So when he's hanging  around with the Parkers .... he'll not feel left out .. ..
 
... and Tony Maryatt ???

Gerry yes, no to the hire

Gerry yes, no to the hire help.

He needs to lose a few chins

He needs to lose a few chins and take some pressure off the health system

I suspect he'll be offered an

I suspect he'll be offered an ambassadorship to somewhere or other to go.
Hopefully somewhere important like, say  zimbabwe or the artic....though my preference would be Jupiter.
regards

and now you are trolling

and now you are trolling again and trying to get the messenger shot.  "oh look steven said something would happen and it didnt"
Grow up.
So predictions based on time, no, on events, well for 5 years Ive said what events we face. The unknowns are the actual time they occur as there is a possible time span involved.
a) We know peak crude oil output was around 2006 but that might be exceeded briefly anytime out to 2018~2020 before it declines and steeply.
b) House prices are 60% over-valued, they will correct....
c) Our population will decline in the next 20 years, the only choice is how do we do it.
 
regards
 

Steven fair enough. These are

Steven fair enough. These are genuine predictions, so three days into 2014 and I am one prediction down. For prediction C do you mean 'our' as in NZ or as in the world.

This prediction stuff is all

This prediction stuff is all good fun :-) Reminds me of the saying I read yesterday but now can't find the author to credit it. Something along the lines of:
If you call a bubble and get it wrong you look like a fool. If you don't call the bubble and get smashed in the aftermath you become a fool.
 
Here are mine:
Most people will continue to discuss trivial issues and believe everthing will be hunky dory again if we just to X + Y & Z while failing to grasp that a deeper paradigm shift is underway. A short but great video here of Steve Keen at zerohedge outlining how economics intentionally excludes finance. He understands that the interest component compounds. He has my rework of the Quantity Theory of Money where I introduce interest. (M.V)+i=P.Q
 
While the potential still exists it is likely that any major catastrophe will be contained in 2014.
 
Interest rates won't go up, or if they do the consequences will be so adverse that they will soon come down again, and then some. The FED will expand QE again by the second half of the year.
 
New Zealand, while on the surface perhaps looking rosy, will continue to get smashed around in the backwash of international currency battles.

Agree... 12months is a long

Agree...
12months is a long time though.
regards

Ambrose on top

Ambrose on top form:
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/105462...
 

We enter the year of the all-conquering US dollar. As the global security system unravels - with echoes of 1914 - the premium on the world's safe-haven currency must rise.

The effect is doubly powerful since the US economy is simultaneously coming back to life. America has shaken off the most drastic fiscal tightening since the Korean War, thanks to quantitative easing. Growth is near "escape velocity" - at least for now - at a time when half of Europe is still trapped in semi-slump and China is trying to cool the world's most dangerous credit boom.

As the Fed turns off the spigot of dollar liquidity, it will starve the world's dysfunctional economy of $1 trillion a year of stimulus. This will occur through the quantity of money effect, hitting in a series of hammer blows, regardless of whether interest rates remain at zero. The Fed denies that this is "tightening", and I have an ocean-front property to sell you in Sichuan.

It is hard to imagine a strategic and economic setting more conducive to a blistering dollar rally, a process that will pick up speed as yields on 10-year US Treasuries break through 3pc.

and this
Asia's two great powers are on a quasi-war footing already, one misjudgement away from a chain of events that would shatter all economic assumptions. It would leave America facing an invidious choice: either back Japan, or stand aloof and let the security structure of East Asia disintegrate.
Trade this if you wish. The Dow Aerospace and Defense index (ITA), featuring the likes of Raytheon and Lockheed Martin, has risen 60pc over the past year, compared with 29pc for Wall Street's S&P 500.
Fuji Heavy Industries (robotics) is up almost 200pc this year in Tokyo, and Yamaha (also robotics) has doubled. Equities are pricing in rearmament. Japan raised spending on military equipment by 23pc last year. It has launched an 800-foot long DDH-class helicopter carrier, an Osprey aircraft carrier in all but name.

A great read Roger. Yes the

A great read Roger. Yes the big questions are what the USD will do this year, how the emerging markets fare if there is a USD rally and NZ to an extent. I'm hoping our RB is sensible about how they manage monetary policy this year and don't gallop too far off into the sunset with rate hikes as our banking industry has recently shown signs of. China's credit boom is the number one concern for both us and Australia in my view. Lower real interest rates could be a wise insulation against significant tradables inflation due to a runaway USD, epecially if milk powder doesn't hold up. 

Longer term trends through a

Longer term trends through a glass darkly.

The core prediction is that human populations will continue to grow. Everything else follows.

Pressure for living space will also grow and low population density countries will fill up with former citizens of high population ones. Where this is resisted conflicts will eventually ensue.

Low labour cost low social support economies will continue to displace jobs in high labour cost high social support economies. Consumption in both will continue to be funded by credit to facilitate consumption without production and further polarisation of wealth and power. Ever more cunning ways will be found to maintain consumption happiness.

Resource demand will force new resource development in minerals and food and particularly use of sea linked resources with short term parameters eclipsing longer term concerns.

Squabbles settled amicably or by conflict will be used to decide how remaining resources are distriibuted.

Human ingenuity will continue to develop temporary technical solutions to many perceived problems and will in turn generate new problems of equal scale - (see  The Technological Society by Jacques Ellul). This will continue to be called progress. Ethical and moral progress will continue to be elusive.

Increasingly data will be collected at the individual level, analysed and used to control and direct behaviour by persuasion or if necessary by coercion. Human 'chipping' will increase to facilitate this.

The highest growth industry will be protection of intellectual property rights based on privatising knowledge and former common wealth

Rose tinted specs now...
For New Zealand its all good at least in 2014. We'll worry about the long term when it comes.

1. Obession with property

1. Obession with property will continue, especially on this site.
2. London, Manhattan and that internation backwater, Auckland... property will continue on its rise, allows me to sleep at night:-)
3. More squeezed NZ clients will choose to buy a property in Spain  rather than aussie, partly opt out and chase the sun.
4. Its election year and economic expenditure will be ramped up in Christchurch, the untolded story will be those not in construction will lose out in wealth relativities in canterbury.
5. The election will be decided in Auckland not Christhurch. Socialism, central control will win regardless, run if you are a SME.
6. God willing... I will continue to travel the world for anyother year against PDK and Steve predictions my time doing so is up.
7. Yes interest rates will rise but not as much as the projections, at least not before th election.
8. It is time for a market correction, in which market I could only guess however the market makers will have already decided...when and where :-)

4. Avon River city-to-sea

4. Avon River city-to-sea reserve? I wish, though a recent trip along the river now the clearances are well under way brought home the breathtaking size of the land area and the huge puzzle it's going to be to find any sort of use for flood-prone uninsurable land. As a park maintenance costs would be massive. Goodness knows what else it could be used for: horticulture to keep the environmentalists busy and not moaning (excellent growing soil)?
As you say "those not in construction" and associated (sellers of large utes; landlords) are losing out. Anecdotally I'm seeing the big/medium firms doing well; the muscle (tradies) doing very well in some cases and many others right now hitting the two-years in for contract workers whammy of tax, provisonal, tax, ACC: wallets are zipping across the city. The other game in town is hospo/bars: roaring; fortunes are being made with a good boozer.
5. The election: will be all about both Auckland and Christchurch. And it will be focused on ever-smaller swing slices of each city as polling and effort becomes more strategic and focused  rather than the carpet-bombing policy sweeps of the past.
Predictions for myself: a repair strategy other than the less-than-reassuring, "Move out and leave it to us love. We'll have a look under your floor once the furniture is out and decide what to do then." Other than that a thorough repiling of life's foundations would be sweet: most people I know on this munted side of town are quietly and genteely buggered but carrying on.
 
 

Punters get sick of all the

Punters get sick of all the boring usa property investment vehicles and seminars and start wondering how much their fat kiwi dollars buys in barcelona and hvar.

I have been out to Spain to

I have been out to Spain to have a look. Just take a lot of care. Lots of apartmnets that look great until you notice there are no roads leading to the apartments and they come missing the sewerage pipes. This is where the developer has run amok and built ahead of the Council's ability to complete the waste connections and the transport agency to get the roads in and they are no faster than our own Auckland Council, perhaps even alot worse.

Have u really, when? whats

Have u really, when? whats the situation in madrid/barcelona/non-costa type locations? have u seen spanishpropertyinsight.com

A wee bit of personal

A wee bit of personal observation.
Spain was a nice country, joined the Euro, went mad on building and taking in the sun worshippers.
Now a concrete and legal jungle, all around the coast.
The problem now is like here, crap buildings, thrown up on whim and a prayer to take advantage of the unwary. 
They also are a lot cheaper than our particular crap, thrown up for a song, but even more overpriced today, than a sane person could imagine.
Spain also built places, apartments mostly, but others too, that worked around the law and did not get pre-approval, just hocked off to the highest bidder.
Now they are tearing these down, as they find them, but the suckers who paid for them from the so-called developer are out of pocket, big time.
Thousands more to come down. Apparently.
So beware when you see a bargain. Sometimes they are not. Due diligence is needed.
And Spain has one of the highest youth un-employment fiascos. Something else to factor in.
When I was last in Spain at a friends villa, there were 35 cranes around a golf course, spoiling the view, building apartments for the wanna be Tiger Woods.
Hundreds and thousands empty and jerry built to boot.  All along the coast.
Spain has spoilt some areas with huge growing modules, green house type flaky buildings to feed the expanded nation/euro pop.
It can be seen from space and is the biggest eyesore ever built in Spain. And that is saying something.
 
 
 
 

funny .. how the locals only

funny .. how the locals only see the trees and not the forest while outsiders can see

Trees are a good analogy

Trees are a good analogy icon, was in Mabella not long ago, and Alter Ego is bang on. Take a drive from Gibraltar up to Marbella, rows and rows of half built apartment complexes with tress growing up through them. A sight to behold. No wonder the banks needed a bailout.

Isn't there a parallel in

Isn't there a parallel in what is happening in Auckland
 
The parallel sticks out like dogs-acketts .. but no-one seems to see it happening in our own back yard .. but we can see it happening in some-one elses backyard .. maybe one-day when it's all done and it's too late people will look back and wonder about what they once had
 
Alter Ego says
Spain has spoilt some areas with huge growing modules, green house type flaky buildings to feed the expanded nation/euro population (that sounds familiar) 
 
When he was last in Spain, at a friends villa, there were 35 cranes around a golf course, building apartments, spoiling the view (that sounds familiar)
 
Change the timing and the location and the end result is the same - I see the very same thing happening to Auckland

Spot on.              

Spot on.
 
 
 
 
 
 
 

-the Government does not

-the Government does not reveal what they are agreeing to in the T.P.P. Treaty in a time frame that allows analysis and debate before signing it.
-while some of the worst favouring of multinational companies will be negotiated out, it will still contain provisions that see the effective gutting of Pharmac and us paying U.S. prices for drugs.
-the treaty will not clear the U.S. Congress, leaving everyone else bound by the provisions that the U.S. have negotiated in.
-because it will not clear congress, N.Z. access to U.S. markets will not be improved, but Federated Farmers will still declare it as a great success.

From what I read elsewhere

From what I read elsewhere due to the US elections if it wasnt signed before Xmas or not long after it would be put on "hold"? Plus I think neither the Green's or Labour think much of it so if they get in I think its a dead duck.
I agree the farmers think its a great thing, what surprises me is many others dont.  Mabe enough are in-different, dont understand or simply support National blindly, I mean they  have wallets and votes as well as the farmers.
Pharmac etc, yes exactly and Grey Power is quite a voting block as well...hence Im surprised its even kept alive.
regards
 

Very thought-provoking

Very thought-provoking predictions here:  I'd add another from the ever-reliable Torygraph:  the threats to civilisational stability.  Just as a fundamental assumption of Fish is that Water continues, the whole edifice of global trade rests on similar assumptions:

  • relatively open borders
  • rule of law and contract enforceability
  • active policing of commercial predators (pirates, monopolies, etc)
  • a general rationality

 
A word about the last two.
 
We are seeing the beginnings of the shift from American policing of the high seas, to Asian (Japan, China, India).  Just as the US Marines got started by hunting down and eliminating the Barbary Pirates, so China is cutting its teeth on the Somali pirates (heard about any Suez-transit merchant vessels being hi-jacked recently?  Wondered why not?).  And as AEP has eloquently noted, just as WWI was kicked off, inadvertently, by a teenaged anarchist, similar tensions exist in an arc from the ME and Indonesia, right through to Japan, just awaiting the next misfit.  And there's no shortage of either Tensions or Misfits.
 
I don't think that Rationality is going to be very evident.  We already see exactly this in Iran's (and its client states - Syria/Hezbollah being an odious example) attitude to Israel:  that in a 'correct' world. the latter shall not exist.  And in the Stalingrad bombings, where an autocratic and extremely powerful Putin is facing off a diffuse, embittered and well-armed threat to - well, any unbeliever will do.  Economic predictions do, tiresomely, rely on a large degree of rational calculation.  I suspect 2014 will test this thesis.
 

Thanks for that link. There

Thanks for that link. There is an argument that the key mistake was when Bavaria bowed to Prussia. I'm not German, so I am unable to say if there is any truth in it.
 
Oddly both my father and my wife's parents thought the re-unification of Germany in 1990 was a worrying development. I thought it was a big step forward, but it does seem as if the East Germans (ie the Prussians) have taken over and have already undone much of the good that West Germany achieved. It is eerily similar to how the US went from being seen as the bees knees after the fall of the USSR to a country hated by large sections of the world a few years later.

National will be re-elected

National will be re-elected with a comfortable majority and will not need a coalition partner. -- Well they have to get smart first and i cant predict that.
 
Everyone knows our elections are all about the "Party Vote"
 
If you score over 5% then electorate seats are a waste of time.
 
Giving electorate seats to stupid, no-hopeing third parties is messy and a waste of time.
 
So what to do
 
National to make all their Electorate seats into Independant seats. That is all National Party MP's holding an electorate seat become Independant MP's.
 
An Independant MP can still be a member of the National party and use the National party office they are just standing as an Independant.
 
Now
 
National win, say 44% Party vote and form a coalition government with their 30 Electorate (Independant) MP's.
 
National will also get a share of all wasted votes. So if Colin Craig and Winston do not make the 5% then the winning parties share that vote.
Example
Asume an election with only 4 parties. And National get 46% of the vote, Labour get 46% of the vote. Both Colin and Winston get 4% each so dont make it into parliament. What happens now is that N and L get all the seats, or 50% each. They have raised there votes by the amount of wasted votes
 
So National win 44% of the total vote, plus say a share of say 10% wasted vote of about 4% takes them to 48%. Still not enough but with their, say 30 Independant MPs they have a majority.
 
End result National 85 seats, other parties 65 seats. National win with a majority of 20 seats.
 
Or they could just make, say 10 seats independant and still win easily.
 
Labour and others wont do this because they dont trust each other to remain loyal.
 

Alright then, yet another

Alright then, yet another dopey prediction.
We will all be as high as a kite, soon.
The only growth industry worth investing in.
A  real growing trade.
Blow fags, suck this as an investment.
But it will be taxed, to compensate the State and the Corporations, for the true backy demise.
Internal Revenue is everything, after all, as long as it is controlled by the state, for the state, by the state, no matter what state you end up in.
No need to import other drugs. No need to go elsewhere, for your coma, no need to hide your light, behind a bushel.
http://www.csindy.com/IndyBlog/archives/2014/01/02/marijuana-madness-denver-councilman-retracts-weed-fears-stocks-and-prices-rise-and-pueblo-drug-dealer-relaxes
No need for any more policemen, no need for anymore illicit growing, no need for jails, no need to protect the kids from their wacky backy parents, they can all be doped up together, but legal.
All above board, all the family can join in.  Will keep em all quiet.
All you people care about is houses.
Get with the real world, it is................ smokin.
Where America goes, we addicts, will follow.
Put that in yer pipe and smoke it. Put it on the house.
Probably we will, as most of you have been dreaming, for years.
Just say a legalised  high, from me.
They will do anything to get yer money.
That is my final No1offering, on the subject.
If ya cannot ban it, tax it.
 
 

Yay Alter Ego.........but

Yay Alter Ego.........but ,unless you did not yet know , 20% of the population on Fluoxetine, (prozac), 20 % smoking cannibis albeit illegally. 50 % getting pissed to the eyeballs post payday, 20% of those pissed and stoned, 10% of those pissed ,stoned and on prozac.....leaving a split between the clean living in control freaks and the P users.
I 'd say there's no shortage of high going on , just finding applicable tax policy.
 Now for the real predictions .......who is gonna get pantsed in the Americn Bonds checkmate  when the fed is forced to move, before sinking into the Boj deflation trap.......
Here's an interestin take on that.......http://www.slate.com/blogs/moneybox/2013/10/17/china_bond_purchases_stop_being_wrong.html
And one more...http://business.time.com/2013/10/15/china-got-into-bed-with-the-u-s-treasury-and-cant-get-out/
 China' policy of subsidy exports will come bite their ass,....it will be this year  , there will be a major revision of policy by China for what appeared to them several years ago to be a logical thing to do ith U.S. Fiat overload.
 The savers have copped it, I'm thinking the BondBoys are in for a rough ride with the Fed running out of options as there economy recommences a growth cycle. 

That's what GBH means by

That's what GBH means by bringing in "cultural diversity"

20% of the population on Fluoxetine, (prozac),
20 % smoking cannibis albeit illegally.
50 % pissed to the eyeballs post payday,
20% of those pissed and stoned,
10% of those pissed, stoned and on prozac

.. leaving a split between the clean living in control freaks and P users

No , that is defintely not

No , that is defintely not what I mean by bringing in " cultural diversity " ....
 
.... sheeeesh , you guys have lost the Christmas spirit quickly , and descended back into being a buncha bad tempered anti-immigrant misery guts's .... ummmmmm ..... are you from Australia ?

Not wanting NZ to have too

Not wanting NZ to have too many more people in it pretty much automatically makes you anti immigration, especially on a grand scale.

... that is insane dribble

... that is insane dribble ... name me one country that wants " to have too many people in it " ....

Try the UK, they have

Try the UK, they have recently woken up though.

... they have an open door

... they have an open door policy foisted upon them courtesy of their committment to the European Union .... more the fool them to gift away the rights to their own borders ...
 
But you have proven my point correct , no one wants overpopulation , raegun is talking complete bollocks ...
 
thanks for that , moa man

You would have to come from a

You would have to come from a diabolically awful country to prefer the UK

Really? 2012 stats: 

Really?
2012 stats:  Immigration into UK
    1.    China
    2.    India
    3.    Poland
    4.    USA
    5.    Australia
2012/13 financial year stats: Residency granted in New Zealand     
   1. India
   2. China
   3. UK  
 

The problem is they dont

The problem is they dont recognise yet they have over-population...like you they cant / dont want to think ahead.
regards

Well you need not worry, are

Well you need not worry, are you not such a skin flint that you will not drive into the megopolis of wellington cbd for fear of spending a dollar on parking?

Out of context. Attack

Out of context. Attack messenger, failure of logic.
And no, 1) to start with I dont need to I can shop elsewhere.  2) $1 gets you 15min if you are lucky...2 hours shopping bye bye $10, I'd rather buy 2 coffees while parking for free.  3) If I have to use my pass and buy a coffee......less CO2.
regards

Straw man agrument, attack

Straw man agrument, attack mesenger, fail of logic x2 , as usual.
regards

Too many MORE people, in

Too many MORE people, in other words, we have about enough, now

Thats better, you used small

Thats better, you used small words, GBH might get there.....but um some 5 and 6 letter ones....he might not.
regards

Thanks for the pointers. I

Thanks for the pointers. I believe all politicians and bankers are on something or other, already. 
Maybe a toke will do us all good, in the long run.
At least our Civic Leaders prefer a different kind of crack, to cocaine but they are not all they are cracked up to be, so it is no joke, either way.
The Canadian mayor has put in for re-election, by the way.
I personally think we should get rid of all elected officials. To many people on drugs to make a sensible decision. Half of em are stupid, the other half are cracked.
And I think I have been proved right, over the past few years.
Unfortunately, I think the joke is on me.
 

I see that on coursera, the

I see that on coursera, the free online massive courses site, from Feb 17 Bob Shiller (the Nobel prize winner) is giving a course on Financial Markets.
https://www.coursera.org/course/financialmarkets
 

financing, or parasite, that

financing, or parasite, that is the Q.
Maybe up until 30 years ago the former, now I'd seriously consider that much of it is the latter.
regards

..

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2014, Investment

2014, Investment opportunities, will present but New Zealanders(Aucklanders) will remain blindsided by property, with this in mind the media will roll out  a rental shortage/crisis meme in Aucklland in the coming weeks.                                                                                             Auckland will create insufficient employment opportunities for its population base(whether based on  the Census numbers or Tony Alexanders 'pull them out of a hat ', unemployment will rise .                                                                                                                                                     Mr Wheelers primary focus will be on maintaining the stong (strenghtening) NZD which will cloud  ongoing  structural issues , the NZD will reach parity with the Australian counterpart and igo north of 80 on the TWI.                                                                                                               Australia will slow quicker than most expect and have its AAA rating put on watch.                   Its election year, so statistics will be moulded to suit , we often question the validity of oversaes data but Statistics NZ showed by 'inadvertently' releasing trade data early prior to Christmas and then giving  GDP a 600 million boost by restating the method of IT/media data collection , shows the old adage has a  place in New Zealand                                             Japanese cars will become cheaper once dealerships have utilised all other inducements.  Incomes will barely rise at the rate of non tradeable inflation, other than that with  Felix from Westpac  forecasting  five rate rises will ensure the year is exciting .and trading opportunities on both the short/long side are there for all.

Well heres my

Well heres my thoughts
Banking collapse started by germany  this will cause the start of the derivative collapse and will result in the Central banks printing unprecedented amounts of money.
Bond market collapse by 30% in USA  USD to drop against the NZD , NZD will trade close to dollar to dollar
China will move to back the RMB as a global currency with gold , gold to go to $ 2500 USD per ounce by september
USA will try soooo hard to invade someone !! anyone will probably do
The collapse of the pedro dollar
Interest rates will go much higher in NZ , property bubble in NZ ( auckland) will collapse
 

No that was last year :-P

No that was last year :-P

8:15 am - fyi, commenting on

8:15 am - fyi, commenting on this story will be closed later today.
 
3:30 pm - Comments now closed on this story.