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American jobs growth disappoints; Canada's jobs growth beats expectations; China's fx reserves swell; EU inflation hits a record high; Australians lock themselves down; UST 10yr 1.77%; oil softer and gold firmer; NZ$1 = 67.8 USc; TWI-5 = 72.3

Business / news
American jobs growth disappoints; Canada's jobs growth beats expectations; China's fx reserves swell; EU inflation hits a record high; Australians lock themselves down; UST 10yr 1.77%; oil softer and gold firmer; NZ$1 = 67.8 USc; TWI-5 = 72.3
Sunrise at Hahei beach, Coromandel
Sunrise at Hahei beach, Coromandel

Here's our summary of key economic events overnight that affect New Zealand with news the American labour market didn't grow as fast as expected.

US non-farm payrolls rose only +199,000 in December in a disappointing result, half the gain that was expected. Although these payrolls are now +6.5 mln higher than year-ago levels, they are still but still -2.7 mln lower than the pre-pandemic December level (-3 mln lower on a seasonally adjusted basis).

A lack of available workers is getting the blame. Are they close to "maximum employment"?

There are some positives however; their jobless rate fell to 3.9% which is better than expected. Their participation rate didn't change at 61.9%. And their average hourly earnings rose +4.7% which was more than expected. Average weekly earnings also rose +4.7%.

The US Fed will probably feel the pressure of the fall on the jobless rate and the rise in wages, even if the labour market growth is less than anticipated.

US consumer credit rose at twice the rate expected in November (although the October rise was revised down marginally). It expanded by +US$40 bln in the month, the largest monthly rise in more than ten years (and ever, if you look past some one-off statistical corrections in both 2005 and 2010). The big impetus for this growth was primarily from bank lending, rather than from the non-bank sectors.

Canada's labour market improved more than expected. There was a +123,000 jump in full-time employment and a -68,000 drop in part-time employment, pushing their jobless rate down to 5.9%. Canada's participation rate is 65.3% and unchanged. However, average hourly earnings only rise +2.7% there. Overall, these results probably also bolster the case for a Canadian rate hike 'soon'.

China's foreign exchange reserves rose marginally in December to US$3.25 tln. But it caps a year of rises taking them to their highest since the end of 2015. But recall they touched US$4 tln in late 2014, so they are still a long way below that.

Taiwan's export growth is slowing marginally, but it is still running +23% above year-ago levels.

Yesterday we noted that German inflation was up to 5.3% in December. Today, the full EU rate was released, rising to 5.0% over the whole bloc and this is its highest ever for the EU as a whole.

In Australia, ANZ says spending in Sydney and Melbourne is now near levels typical of lockdown conditions. Indeed, total ANZ-observed spending in Sydney is at its lowest point since COVID began, they say. Caution about being in public places is being compounded by staff shortages to stifle spending across dining, retail and travel. Dining spending in Queensland and Western Australia resembles previous lockdown conditions.

Now their Treasurer has tested positive and is locked in self isolation.

In NSW, there were 38,625 new community cases reported yesterday, similar to the day before, now with 234,066 active locally-acquired cases (and undoubtedly an undercount), and 11 more deaths. NSW hospitals face critical staff shortages, and they have been told the number of COVID-positive people needing inpatient care could exceed 4500 within a month. They are already at 1738. 21,727 pandemic cases in Victoria were reported yesterday, similar to the day before. There are now 69,680 active cases in the state - and there were more 6 deaths there again. Queensland is reporting 10,953 new cases and no new deaths. In South Australia, new cases have slipped slightly to 3070 yesterday. The ACT has 1246 new cases and Tasmania 751 new cases. Overall in Australia, 72,705 new cases were reported yesterday and their hospitalisation rates are now above peak Delta levels in some states. NSW is limiting hospital and nightclub admissions to preserve their pandemic-fighting capacity. Supermarkets are reporting more than 20% of their staff are calling in sick.

It is not only Australia struggling with a permissive policy response to the pandemic. We all know about the US and the UK's public health failures, but Sweden is another under significant hospitalisation pressure.

The UST 10yr yield opens today at 1.77% and another +4 bps higher that this time yesterday. The UST 2-10 rate curve starts today a little steeper at +90 bps. Their 1-5 curve is steeper again +108 bps, while their 3m-10 year curve is also steeper at +172 bps. The Australian Govt ten year benchmark rate is up another +1 bp at 1.87%. The China Govt ten year bond is unchanged at 2.84%. The New Zealand Govt ten year is also unchanged at 2.46%.

Wall Street seems to have taken the jobs data in its stride, with the S&P500 down just -0.1% in Friday afternoon trade. Overnight, European markets all fell about -0.5% although London rose with a late burst. Yesterday, Tokyo was flat while Hong Kong ended up +1.8%, and Shanghai fell -0.2%. The ASX200 recovered +1.3% while the NZX50 slipped a very minor -0.1%.

The price of gold started today at just under US$1797/oz and recovering +US$6 from this time yesterday.

And oil prices start today about -50 USc lower at just under US$78.50/bbl in the US, while the international Brent price is now just under US$81.50/bbl.

The Kiwi dollar opens today firming slightly at 67.8 USc. Against the Australian dollar we are marginally firmer at 94.3 AUc. Against the euro we are marginally lower at 59.6 euro cents. That means our TWI-5 starts the today little-changed at 72.3.

The bitcoin price has fallen again from this time yesterday, down another -3.0% at US$41,832. That is more than a -10% fall since the start of 2022. Volatility over the past 24 hours has been high at +/- 3.5%.

The easiest place to stay up with event risk today is by following our Economic Calendar here ».

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89 Comments

Hopefully things will burn themselves out over the ditch soon, it'll be an interesting few months watching what the Omicron tail looks like. On the surface less government intervention and more virus doesn't look to be any improvement.

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6

Appreciate the remaining summer holiday break . . . a couple of jabs, masks and passports are a small inconvenience compared to the lockdowns and 240,000 laid up in NSW. 

I’m really surprised at the current low NZ numbers but appreciate that is likely to change once Omicron enters the community post holiday period. 
Jacinda and Ashley may have got something right?

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1

Case numbers are a function of testing, which there won't have been much of over the Christmas break. There will be plenty of unreported cases out there.

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10

Yep, got a test yesterday arvo,  8 people standing round in an empty carpark waiting for people to test.  And a negative result back at 7am this morning so the labs aren't busy. 

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4

Case numbers are a function of the virus, which people go get tested for when they're symptomatic.

So there will be more cases, just how many more. I was envisaging thousands a day by now a couple of months back, but it's stayed stubbornly low. It will be interesting to see over time what has made our numbers relatively lower than Australia's, despite taking fairly similar approaches. 

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3

You’re assuming all people go and get tested when symptomatic. Many with mild symptoms, COVID or otherwise, are avoiding getting assistance or tested at this time so as not to ruin their holidays.

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9

I'm not assuming that at all, it's pretty clear not every positive case is tested and confirmed. More that when numbers are rising more people are symptomatic, and get tested. If you don't have a lot of symptomatic people, you don't get a lot of testing. 

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1

Essen

Your assumption is sound but exactly the same premise applies to NSW. Not all with COVID in NSW will get tested for a variety of reasons - but arguably the ratio of those tested between NSW and NZ will be in a similar ball park. 
On that basis, if we had adopted the same policies as NSW including allowing Omicron in we would be currently looking at over 20,000 reported cases yesterday and currently 140,000 active cases. Our current incidence of around 50 per day is minimal in comparison. 
This won’t fit with the narrative of the anti-government posters on this site but that is the reality.

Note: Yes I know NSW have self-reporting. 

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6

Jacinda is keeping Omicron away during the summer months and will now likely suffer its wrath in the winter months. Why exactly do you think the Ozzies let it rip in summer?

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21

Yes Master plan..face palm

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8

We all expected Omicron to be spreading about the place now.  And we have all been wrong. Well so far.

Can't see how Frazz can justify his "face palm" comment. It's the virus that gives us the runaround Frazz.  Not the planners

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1

Thinly veiled political tribalism.  It's almost like the Ministry of Health, the agency tasked with actually managing the pandemic response, would be made up of different people and completely different outcomes if another political party were in power.  

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7

I think he was making light of gen-xs assumption that the current omicron outbreak in Australia (and lack thereof in NZ) is some sort of planned caper.

You know, because governments can be lambasted for being both incompetent, yet capable of masterminding large grand conspiracies all at the same time.

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11

Thank you.. bang on

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2

That’s an interesting proposition. 

If covid’s really a globally coordinated effort to say reduce international petroleum consumption, or constrain freedom in preparation for a global economic reset.. etc...  Then Ardern, Wiles, Hendy and their overseas equivalents would be “useful idiots” in the political sense, and that’s plausible.  If, on the other hand, there's no hidden agenda, then what we’re dealing with is a corrupt and regulatory captured WHO and FDA who’re maximizing profit for their benefactors.  Those corrupt entities would be the source of the illogical groupthink propagated by politicians and partisan scientists.  That’s also depressingly plausible.      

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5

You mean the difference between stupid or smart enough to act stupid.

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2

Yeah I don’t get this. Strategy of taking the hit in April/may is next level stupid. 

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3

Do you think NZ can avoid the same? 
 

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1

Shouldn’t need to worry about it. The much vaunted 90% vaccination rate is met in the majority of the country. Boosters are underway. The government, Robertson & Little repeatedly assure the hospital system is coping & will continue to do so. NZrs have been compliant to government policies, and should now surely be able to reap the benefit.

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10

Precisely 

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4

My wife and I are stuck in Brisbane been in Ozzy since March . In our 60s DBL vac  . Fairly fit.Both had omicron over Xmas. Wife had cold like symptoms for 3 days l had nothing much at all. Still can't get back to NZ...does the government realise how much pain they are causing worldwide. There has been more suicides than COVID deaths . They would do well to let omicron in threw summer . Ozzy will be endemic by the end of feb

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24

Please show where it's been established there's been an increase in suicides that's exceeded covid deaths.

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4

Perhaps you could show there hasn't.

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5

Usually the burden of proof is on the person who makes a claim. Otherwise people can say any old thing no matter how ridiculous and everyone else just has to take their word for it.

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9

Yes the suicide numbers are still way to high in NZ .

But l was referring to the 1 million Kiwis overseas.

Very hard to get numbers for them.

About 100,000 really need to get back for all sorts of reasons.

Not many countries around the world have locked out there

citizens for so long , and dosnt look like it will change anytime soon.

There is no hiding from Omicron & wipes out the more deadly Delta.

NZ needs to watch ozzy , staff shortages is the problem 

not the amount of cases.

The Politicians & Media are not helping.

 

Up
6

There's only about 40 countries on earth that have unrestricted travel, and for good reason. In March 2020, the government advised any NZer that wanted to come home to do so straight away, because it was pretty ominous back then that international travel was going to be a crapshoot for quite some time. So forget about unfettered travel for the time being, you are taking things into your own hands travelling in the age of covid. Your situation sucks, but you decided to travel.

The politicians and media are just information and regulation conduits for an act of nature.

No one likes the virus but as much as we want to shout at it, it's working to its own timeframe.

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5

We are lucky we dont have to get back to NZ.

We left last march to help our seriously ill Daughter

in Perth.

When we left we knew the risks .

And will go to the UK for there summer & meet family.

NZ should be all done with Omicron by next summer &

we hope to be allowed back in.

 

 

 

 

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3

I feel for you, good luck.

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2

Ah yes, March 2020, when the government advised kiwis to get back, but just before they got back the RBNZ pulled some ludicrous moves and increased house prices exponentially which also pushed rents up so those who were told to come back and had sold up abroad got stuck in limbo. Many put offer after offer in only to be beaten by neuvo riche investors. Then what to do? It seems any type of fairness is hard to find with this current government.

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3

Yes, it was all a conspiracy designed to drive up house prices, it had nothing to do with trying to ensure economic continuity in the face of a pandemic.

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1

No need to invoke conspiracy for what can be explained by incompetence.

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12

Hanlon's Razor

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0

Agree here they freaked out big time and thought it was the only way to sustain the economy. Now houses has moved from very high asking price of $1.000.000 to $2.000.000 in les than two years 

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1

GenX,  I have been reading your commentaries for a time now and still trying to work out where you are coming from. Do you genuinely hate everything about NZ?

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5

GenX and BL are the same person. 

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5

In your dreams.

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0

Ah yes, March 2020, when son in London had a flight booked for sister's wedding in NZ but caught Covid-19 a couple of days before he was due to leave - along with many others. Rebooked for later in the year, then Delta hit. He still hasn't made it back - now looking at maybe next Christmas.

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0

"In the year to 30 June 2021 (In New Zealand), 607 people died by suspected suicide, compared to 628 the year before –a decrease of 21 deaths, and a drop in the suspected suicide rate from 11.8 deaths per 100,000 to 11.6. It is the second consecutive year numbers have decreased"

- Source: Office of the Chief Coroner 4/10/21

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8

Heard of "travel at own risk"?

 

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2

They should be put in prison for what they've done to kiwi citizens overseas.

It's criminal.

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13

Don't worry mate, soon you'll be in Australia, where migrants are treated with a red carpet on an island detention centre.

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4

No worries, I hold Aussie citizenship.

Yeah mate, the island detention center to where they deport the trash - is Aotearoa.

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3

Oh, so you went Aus-NZ-UK-NZ and then eventually back to AUS? 

How'd a genius take so long to work out where to live?

 

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5

Being able to spend portions of your life living and travelling in different parts of the world is an absolute blessing that more people need to experience.

Can't even imagine what kind of moronic parochial Labour apologist would attempt to use venturing beyond home as some kind of put down. 

Up
9

I've lived in multiple countries and continents since a young age.

You sound like a dozen or so people I've known who went to the UK because NZ was too small, came home only to realise they didn't have anywhere near enough money to buy the sort of house they wanted here, and bitch non stop about the place.

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4

So now you're putting down kiwis for expressing their distress at returning home to out of control housing hyperinflation?

Perhaps they can just see that for all the faults of the UK, its far less of a cluster**** than this place has become.

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4

The place was too small for you, too far from other interesting places to travel too, and too little in opportunity years ago.

So you left, did pretty average, and came back only to find yourself shut out of a market you could have entered a long time ago pretty cheap but thought you knew better.

Yeah, NZ is always going to be a poorly run, crappy hole for you. 

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2

Nah. Did reasonably well abroad and fortunate enough not to be "shut out" like many of the people here sadly now are.

But the rest of your spiel is on the money. The low quality and high cost of living here makes it a very poor value proposition. The country has been extraordinarily mismanaged to get to this state of affairs.

Dont really encounter much passive aggressive bullying in other countries either. Seems to be quite a kiwi thing.

Up
5

Dude, you're not moving to Sydney. You've picked somewhere in Aus with affordable housing, you ain't cracked it, you're needing maximum bang for buck. 

I'm living pretty good in NZ, worked out over a decade ago that Auckland in particular isn't a place to live unless you're earning big coin. I honestly can't think of anywhere I'd rather have spent the last 18 months, and I don't put that down to our Labour government, but more that kiwis are a sensible bunch who can pull together.

There's other places I'll probably live in the world, in the future. But I can't fault NZ anywhere near as much as you can, but then again, I've invested more to it. 

Enjoy the big red sandpit.

 

Up
2

Is it small **** syndrome that makes you want to tear others down?

Of course I chose somewhere with good value for money housing and a great lifestyle. I work remote so why not? Many like minded people are doing the same.

Kiwis are a hysterical bunch. Omicron should be fun.

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3

Haha, getting sad for being torn down for tearing NZ down. 

Like I thought, the pooh you can smell is on your shoe.

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3

Your fragile kiwi ego is offended when people point out uncomfortable things about the current state of the country and feel it's your duty to try to personally attack them?

I suppose it's sad that personalities like yours exist. It's not like I've mentioned anything that hasn't been said by plenty of others. MiQ is horrific abuse of kiwi citizens. NZ is high cost and low quality. Full of got mine, f*** you attitudes.

Probably won't ever improve. It's an endemic cultural problem. No wonder so many kiwis live abroad.

Up
3

This place ain't perfect. But I gave up on perfect years ago. I've been everywhere man, and there's no other place I'd be happy watching the world burn from than here.

You get out of life what you put in. If you expect life to just lay everything out for you like a platter, you'll be waiting a while. Enjoy Aussie.

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5

The world can be an amazing place. Don't under estimate how good other places are right now. They have been through alot but are much closer to coming out the other side than we are.

Up
5

You are kidding yourself.

Many developing nations were reliant on tourism, in some cases up to 90% of their economy.

Turkey is in tatters.

Kazakhstan has basically collapsed and asked Russia to govern it.

China is unravelling.

Europe is being swarmed by refugees.

The US is a basket case but has the leverage to make its way

All you guys moaning can't show me a country that's a better place to be than NZ. 

 

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7

Your answer says all I need to know. There is no point in me conversing with you.

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1

Australia.

That was too easy.

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3

Yeah I agree with you Pa1nter, had a drink with my daughter yesterday while she and a large group of her friends all in their 30s were doing a bit of a pub crawl around Whanganui. They are all very positive and have no fears about the future at all. I struggle to see where all the negativity by some on this site is coming from. Is it just personal circumstance? Family in Auckland in similar age group some with young children, are all doing well and have no gripes either. When I observe what is happening in some areas of the world I can't help but think of Fred Daggs "You don't know how lucky we are, mate"  

Cheer up. All is not doom and gloom.

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2

Yeah I agree with you Pa1nter, had a drink with my daughter yesterday while she and a large group of her friends all in their 30s were doing a bit of a pub crawl around Whanganui. They are all very positive and have no fears about the future at all. I struggle to see where all the negativity by some on this site is coming from. Is it just personal circumstance? Family in Auckland in similar age group some with young children, are all doing well and have no gripes either. When I observe what is happening in some areas of the world I can't help but think of Fred Daggs "You don't know how lucky we are, mate"  

Cheer up. All is not doom and gloom.

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2

Sorry posted twice.

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1

Do they all have parents who can help them get on the ladder (accelerating escalator)?

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3

They may have a appeared happier with 'the drink'... No one wants to be a DGM with a group of friends enjoying their 2 out of 4 weeks of the year holidays...

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3

Gen-X

Yes, it is tough for FHB.

However, I agree with Hans and pa1nter.
I have four millennial sons who without help from me have their own homes and two have investment properties. In the past year over 60,000 other FHB have purchased properties (RBNZ) and I doubt if all of those have had help from Mum and dad.

So, although it’s tough, stop playing the “poor me, poor me” game and start questioning why 60,000 are FHB.

So son, if you really want to be a FHB, continual moaning achieves absolutely nothing other than blame shifting - start asking questions and making decisions . . . something Brock needs to do. 

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2

I want a land rover, I can go on trademe right now and buy a crusty old 2.8i land rover for $350k. I know, it sounds like a joke but its true. Somebody believes that that land rover is worth $350k. Some people would say (because its not their money). If you want a land rover just buy it son and stop moaning. I chose not too, thanks.

https://www.trademe.co.nz/a/motors/cars/land-rover/defender/listing/336…

Up
0

Gen-x

Yes I read the article on the Land Rover a month ago so not news. 

So you choose not to buy a house at current levels while 60,000 others choose to do so . . . your choice. So stop your moaning then. 

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2

Strange, because I did not say it was new news? You don't know how many homes I own in how many countries? All I can say is that buying now in NZ is a mugs game. Some poor youth have been suckered in by the spruikers but at least many more have waited. 

Up
3

Gen-x

So you have lots of homes . . . one wouldn’t have thought so by your comments.

A little bit like Brock  - from not having a home to owning one mortgage free all in a couple of posts.

You younger fellas have done better than I ever did. 
Cheers

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2

The trick, old man, is to buy property somewhere that isn't a stupidly overpriced basket case.

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3

Brock

Great news then son. 

You can now focus of the intrinsic advantages of owning your own home. Pleased for you . . . hoping it isn’t that Omicron riddled NSW due to inept State Government.  :)

Looking forward to happier and more positive comments from you this year. 
Happy New Year. 

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1

Somewhere near Alice Springs.

Happier and more positive comments: has jacinda resigned otherwise no chance

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0

Get some perspective. 

People complain about house prices because the are astronomical.

Hands down least affordable in the developed world. Auckland avg  is like 14x avg income?

Worth complaining about. 

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6

Exactly, and yet only 28 years ago NZ house prices had historically always been 3x median income multiple, like most other places in the world and those jurisdictions that have the right land-use policies still do.

 

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4

Perhaps he thought NZ was the same NZ it was when he left, not knowing that it had become a poor impoverished place where house prices are too high and the cost of living is higher than any normal country. Perhaps he has a free spirit and wanted to see the world. Perhaps he realized just how far the UK and Australia are advanced socially and economically. It is only when you have lived elsewhere that you realize just how badly NZ has been mismanaged.

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7

Have you even been overseas.

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2

Yes Brook , l dont think kiwis in NZ realize the amount of Pain

this MIQ is causing , we tried a couple of times got down to 

24000 , needed to be below 3k , most people have giving up.

Omicron should be embraced now , its our way out to Covid endemic.

Up
9

Yep. I experienced it first hand when their messed up system stranded my heavily pregnant wife, our toddler and I on the other side of the world without jobs or a home and everything we owned on a container ship during the highest level of lockdown.

It was a dark and very stressful time. Nothing but contempt for those crooks. They have ****** over so many kiwis abroad with their clown system. Many people far worse than us and very few people here seem have any real awareness of what's been inflicted on their supposed fellow citizens.

In hindsight I wish we had known how badly they were going to screw up the housing market here.

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8

How dare the NZ government not roll out the red carpet after you spent a decade paying taxes elsewhere.

The nerve.

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4

Sure mate. Kiwis getting put into bad situations through no fault of their own because MiQ is not fit for purpose are just moaning about not getting a "red carpet". 

The government being taken to court in a few weeks over it will be interesting.

Acting like a PoS isn't adding robust or insightful debate. Up your game.

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8

It doesn't fit the narrative to let you back. 

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1

Vaccine passports are an affront to humanity. It's important we don't lose our humanity, if we did, what is left?

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15

Define humanity. Because if it's "don't do what everyone else agrees with", that's not overly human.

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1

Are they close to "maximum employment"?

Hmmmm .. CPS Household Survey data here and here.

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2

I wonder if Australia is hit by the actual infections or the outdated isolation policy. Should they shorten the isolation length with such a high infection rate but a low severity rate? 

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2

Why not no isolation; just a special vest saying "Infected". If that felt embarrassing stay at home.

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0

They are transitional phase of going from low population exposure straight to an endemic phase. They tried their best though by releasing travel restrictions heading into summer and preventing a catastrophe later in the year.

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1

I wonder if they compared the Omnicron spread and hospitalization rate with what would have been the influenza rate (which Omnicron looks like it has now superseded), would the stats. look the same?

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0

In the UK the issue hasn't been the hospitalisations so much as the National Health Service (NHS) staff absences due to testing positive. It's just rapidly moving through the population (I've seen estimates that one in every fifteen people are positive currently, it was estimated that one in every five had it in London after Christmas)  which might well signal the conclusion of the pandemic phase.

Harder to say for New Zealand, most countries had no issue with Delta in summer but even highly vaccinated countries haven't really been spared Omicron. I've never understood the rational behind reopening into winter but that appears to be the shock treatment the New Zealand government is prescribing.

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3

Nail on the head there Squishy . Our leaders are hopefully planning

now how our Hospitals - supermarkets - transport etc will work

when 30% of staff have to stay home . But they have said

Hospitals will cope .

In ozzy now they are trying to get nurses to just work threw it.

This Omicron is not about the high numbers , its all about staff shortages .

NZ needs O sooner & will wipe out the far more deadly Delta.

 

 

Up
4

Final season coming in 2022. #letitrip

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0