Craig Simpson on KiwiSaver's shift to being a 1st home buyer's play thing, homeopathy is just bunkum, why the US Fed won't raise rates anytime soon, Americans with paraskevidekatriaphobia, Dilbert & more
Today's Top 10 is a guest post from Craig Simpson, senior analyst for interest.co.nz.
As always, we welcome your additions in the comments below or via email to david.chaston@interest.co.nz. And if you're interested in contributing the occasional Top 10 yourself, contact gareth.vaughan@interest.co.nz.
See all previous Top 10s here.
1. Changes within KiwiSaver effective from April 1, include the removal of the first home buyer subsidy, introduce a grant of up to $5,000 for individuals and up to $10,000 for couples to put towards a deposit for an existing home; introduce eligible first home buyers with a grant of up to $10,000 for individuals and up to $20,000 for couples to help with the costs of building or purchasing a brand new home and raise the property price caps in some areas. The sad news for Aucklanders is the new cap still isn't high enough to buy a family home within 20 minutes drive of the central city.
A couple of the key points of the revised terms are outlined below. More details can be found on the Housing NZ website here.
If I have a valid KiwiSaver deposit subsidy pre-approval that is due to expire sometime after 1 April 2015, do I automatically get a KiwiSaver HomeStart pre-approval?
No, you will be required to complete a new application and to submit it for consideration. This is because there are some differences between the products.
Is there a limit to the value of the house I can purchase and still qualify for a HomeStart grant?
Yes, the price caps vary by region:
- Auckland - $550,000
- Hamilton City, Tauranga City, Western Bay of Plenty, Kapiti Coast, Porirua City, Upper Hutt, Hutt City, Wellington City, Nelson City, Tasman, Waimakariri, Christchurch City, Selwyn District, Queenstown Lakes - $450,000
- Rest of New Zealand - $350,000.
I am looking at purchasing a brand new apartment off the plans from a developer. The developer has indicated that to secure the apartment that I want, I need to pay them a $20,000 deposit upfront. Can I use the KiwiSaver HomeStart grant for this?
Yes. If you're eligible for a KiwiSaver HomeStart grant, you can arrange for your grant to go towards the first payment that you make under the agreement with the developer.
2. The king of flat pack and ready to assemble furniture, Ikea, is moving with the times and producing some technologically advanced furniture that will charge your smartphone without the need for those unsightly cables. There is a small catch you still have to plug the piece of furniture in but at least you can hide the cable from sight if it really bothers you.
The Home Smart Ikea furniture uses a wireless charging standard known as Qi. It can be found in some Windows phones and Android phones, including the new Samsung Galaxy S6 model due to go on sale next month.
Environmental groups are worried about the ecological impact of the new doodads with eco organisation, Friends of the Earth, telling BBC they are concerned about recycling such products, as they may be difficult to separate from the furniture they are built into. You just can't please everyone I guess.
3. The Economist's Glass Ceiling Index suggests Nordic countries provide the best working conditions for women. Interestingly, New Zealand has slipped down five places from its previous year's rank but is still ahead of the OECD average. The New Zealand slip is principally due to the rising cost of child care.
In many countries the progress towards workplace equality is slow but progress is being made. Japan's government is now pressing businesses to appoint more women to their boards.
Finland's move up the rankings to top spot is in part because it has recently given women almost two and a half weeks of extra paid maternity leave. I noted with interest that Vodafone has recently announced a new maternity policy allowing its employees expecting children a month's extra leave. Under the policy, primary caregivers employed by Vodafone and who return to work for the company within 12 months of the child being born will receive full pay for a 30-hour week for the first six months
On the Economist website there is an interactive chart which allows readers to manipulate the data and the various countries shift rankings depending on which input is changed. Through some juggling of various numbers I managed to get New Zealand to the number one spot.
4. Approximately two-years ago interest.co.nz introduced readers to the Mankiw model developed by Harvard professor Gregory Mankiw (pron: Man- Q). In light of this Top 10 going to press just after the latest RBNZ monetary policy statement and OCR review, it is timely to update the model with the most recent OCR and economic data and forecasts. For those not familiar with this model or its inner workings we suggest reading our original article here,
Using the main inputs from a simplified Mankiw model and using historical and forecasts for New Zealand's inflation and unemployment we can plot the historical RBNZ OCR vs the Mankiw model and also forecast where the OCR should be based on assumptions around future inflation and unemployment and the relationship between these two inputs. The green line in the chart is the forecast OCR track using a selection of major bank economic outlooks for both inflation and unemployment. Obviously the bank economic forecasts will change and this will impact the model and outputs.
We can see that historically the Mankiw model has made a pretty good fist of tracking the actual OCR rate set by the RBNZ.
5. Australian report concludes Homeopathy is not an affective alternative in the treatment of anything. To come to this conclusion the National Health and Medical Research Council (NHMRC) reviewed 225 research papers on homeopathy. This could be another example of the main-stream medical profession trying to defend their patch types of research so I will leave it up to readers to come to their own conclusions.
Referenced in Australian finding was a report by Britain's House of Commons in 2010. The House of Commons report contains an enormous amount of waffle but points 80 & 81 show two contrasting views.
[80]. One aspect of effectiveness is patient satisfaction. The popularity of homeopathy indicates that many patients are satisfied. Dr Hugh Nielson, Consultant at the Department of Homeopathic Medicine at the Old Swan Health Centre, highlighted several patient outcome surveys including:
- An observational survey of over 6,500 patients over a 6-year period conducted by Bristol Homeopathic Hospital. 70% of follow-up patients reported improved health, 50% reported a major improvement.
- A survey of 500 patients at the Royal London Homeopathic Hospital showing that many patients were able to reduce or stop conventional medication following homeopathic treatment. For example, 72% of patients reported being able to stop or reduce their conventional medication.
[81]. Although these surveys show that homeopathy makes some people feel better, it does not, as we have explained, mean that homeopathy is efficacious. The high levels of patient satisfaction could be attributed to the placebo effect, particularly enhanced by three factors:
a) Homeopaths treat the kinds of illnesses that clear up on their own (self-limiting) or are susceptible to placebo responses;
b)Individuals who have been treated by homeopaths usually chose homeopathy as a treatment; in other words, they have invested in the process of undergoing homeopathic treatment, probably because they already know that they like it. That means that it is a self-selecting group; and
c)Homeopathic consultations are long and empathetic.[103] In 2001, a systematic review found that that "physicians who adopt a warm, friendly, and reassuring manner are more effective than those who keep consultations formal and do not offer reassurance".[104] Homeopathic consultations may therefore have a positive impact on patients' perception of the intervention and result in a more powerful placebo effect.
For those looking to get relief from back and neck pain you might like to try a Shakti mat, which is coined a modern day bed of nails. While you feel some discomfort at first, I can attest that it hurts like crazy to start with, but this is soon replaced by a warm tingling sensation. If you believe the marketing spiel this is your body, mind and nerves un-winding.
6. Hawke's Bay folk are officially the biggest supporters of cricket in New Zealand according to Stats NZ. Throughout the 2015 Cricket World Cup, Statistics NZ will be looking at crowd numbers at each of the matches held in New Zealand, and comparing them with the populations around the cricket grounds. The graphic below indicates that Napier had approximately 7.5% of its population attending a match between NZ and Afghanistan.
The other dark cricket balls in this chart are where NZ were playing. Given the form of the Black Caps of late it is no surprise that fans are coming out to support the team and try and catch one of Brendon McCullum's sixes with one hand while wearing a bright orange Tui shirt to try an get a share of $1 million.
7. Get fit and give to charity at the same time. As you may expect in this day and age there is an app that does just that in the US. Once you start and select the charity of your choice (there is more than 30 to choose from) you begin and can track how much you have generated for that charity. I gather this is more for the recreational runner than those more serious types as you need to have your cellphone with you. From my experience of using running apps to track your progress, calories burned and heart rate carrying your phone is a pain.
For those still interested, each running or walking mile generates US 25c for your charity and each biked- mile US 10c. You can choose which charity gets the proceeds from a list of more than 30, including the World Wildlife Fund, Habitat for Humanity, and The Nature Conservancy. The initial sponsorship budget is set at US$1 million. Sponsors of the project include companies such as Humana, Johnson & Johnson, Timex, and Lifeway Foods, who pay to contribute as part of "engagement" campaigns.
In its first year Charity Miles sponsored athletes ran/walked/bike the equivalent of going from earth to the moon and back three times according to a video by one of the founders.
Imagine if all 21,600 (approx) runners/walkers who completed the Auckland Round the Bay's run last weekend were dialled into the app. The distance of the run was 8.4km (roughly 5 miles) so this would have generated US$27,000 in less than two hours. Better still each marathon runner covering the 26 odd mile distance would generate approximately US$6.50 for charity. The best thing I like about this whole concept is I don't have to dip into my pocket, except maybe to buy some new running shoes every few thousand kms.
While this concept is not available in New Zealand yet, maybe some bright spark out there could take up the challenge and develop a similar concept here.
8. Stock markets have been quite volatile lately as speculators position themselves for a possible interest rate hike in the US. One thing to keep in mind is that over the last 25 years the Fed has never raised rates with wage growth at current levels according to the graphic below from Quartz. While wage growth is declining the second chart below shows slow but steady job growth year-on-year.
Federal Reserve Chair Janet Yellen's last testimony to Congress reinforced that patience was required and despite an improvement in the economic data too many Americans remain unemployed or underemployed, wage growth is still sluggish and inflation remains well below longer-run objectives.
The historical chain of evidence supporting no rate hike might be about to be broken as Yellen said that while the slow pace of wage growth was evidence that the labour market still has not returned to full health, the Fed would not necessarily wait for wage growth to accelerate before raising interest rates, because wage growth often lags other kinds of growth.
9. What would a Black Friday top 10 be without some facts about Friday the 13th. The fear of Friday the 13th is called paraskavedekatriaphobia or paraskevidekatriaphobia, a specialised form of triskaidekaphobia, a phobia (fear) of the number thirteen. Pleased I don't suffer from this as I can't even begin to pronounce it.
A 1993 study published in the British Medical Journal "Is Friday the 13th Bad for Your Health? " compared the ratio of traffic volume to the number of car accidents on two different dates, Friday the 6th and Friday the 13th, over a period of years in hopes of mapping the relation between health, behaviour, and superstition surrounding Friday 13th in the UK. They found that while consistently fewer people in the region sampled chose to drive their cars on Friday the 13th, the number of hospital admissions due to car accidents was significantly higher than on Friday the 6th. Their conclusion: "Friday 13th is unlucky for some. The risk of hospital admission as a result of a transport accident may be increased by as much as 52 percent. Staying at home is recommended."
Phobia specialist and coiner of the term paraskevedekatriaphobia Dr. Donald Dossey estimates approximately 21 million Americans could be suffering from paraskevedekatriaphobia.
How they come up with this number is beyond me.
10. John Oliver: Daylight Saving Time - How is this still a thing?
9 Comments
I think the placebo effect is great, if you can get it to work on 70% of patients, thats fantastic! No side effects either. I don't understand whats not to like about it? I'd like to know how many types of prescription medication have a better strike rate without side effects.
Please be so good as to supply peer reviewed studies in reputable journals demonstrating homeopathy has any beneficial effects on children and animals. I won't be holding my breath.
As to the claim that perhaps it is the medical fraternity protecting it's patch. You don't even have to venture into this area. All you need to do is just think what standard homeopathy theory claims - that you can dilute a substance out until it is no longer present and yet the remaining water somehow retains a 'memory' which then serves to act in a beneficial manner.
Then come back and tell me that this is anything more than quackery.
King of the whiners: I have no interest in homeopathy but your argument does not hold water. (pun intended) If something works, ie, placebo, then it works. That you don't understand the mechanism doesn't change that it works.
It's a common mistake amongst scientists.
As for placbo. What a wonderful treatment. As Skidiv says "whats not to like about it"
Mind you, placebo is hard to patent and sell, and thus the drug companies don't like it. Nor does the medical profession like anything they don't control.
I think it is you that fails the placebo test. I dont really think you understand what' no better than placebo' means.Tell you what, next time you have a bacterial infection, ask the doctor to give you placebo rather than antibiotics. Come back and tell us how that works out for you.
As for not understanding modes of action that contravene some important laws of physics - well perhaps the practioners (or in this case snake oil salesmen) shouldn't claim this mechanism in the first place. The problem is, they do.
The placebo effect only works when there are sujective measurements such as 'pain relief'.
In instances such as serious bacterial sepsis, or in the case of other objective measurements such as blood pressure control / cholesterol the placebo effect is null. I hope the people above understand this distinction.
I'm curious to know what laws of physics homeopathy contravenes? I think there is a world of difference between saying something can't work and saying you don't understand how it works. I don't think anyone really understands how homeopathy works, though some make that claim. I also don't think science knows everything, take for example life, as yet there is no demonstrable proof that life can start from a mixture of chemicals and water, even though we don't lack the knowlege of the actual chemicals that form a single cell organism there is a bit more to it then just lumping them in a petri dish and warming it up. So there is still plenty to be discovered, and fundamentally science is the pursuit of truth. For now I'll keep an open mind.
Paul Krugman on the TPP - http://krugman.blogs.nytimes.com/2015/03/11/tpp-at-the-nabe/?module=Blo…
"Not to keep you in suspense, I’m thumbs down. I don’t think the proposal is likely to be the terrible, worker-destroying pact some progressives assert, but it doesn’t look like a good thing either for the world or for the United States"
"I’d argue that it’s implausible to claim that TPP could add more than a fraction of one percent to the incomes of the nations involved; even the 0.5 percent suggested by Petri et al looks high to me."
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