Here's our summary of key economic events over the weekend that affect New Zealand with news we are about to join the rest of the world in an Omicron sickness wave.
But first up, signs that Omicron in the US is about to pass its peak are apparently good. A fast fall-away after that is expected. And they say early data on the booster shot shows it should have a long-lasting effect.
The US Conference Board leading index is marginally better for December, and they see US 2022 real growth at a healthy +3.5%. The Atlanta Fed's view is the US economy is expanding currently at a fast +5% pa rate, and the current blue chip consensus is even above that.
All eyes will be on Wall Street tomorrow after a week of sharp retreats. And on Thursday (NZT) the Fed will report its latest signals, which will be watched with unusual interest given the spike in inflation.
Canada's November retail sales results were released over the weekend and they were disappointing.
In China, ahead of both the Winter Olympics and the big Chinese New Year break, the economic news-flow is light, even for their closely controlled media situation. However one item does seem interesting - the artificial snow needed for the Beijing Winter Olympics is so much that making it is straining Beijing's water supplies. And Beijing is in a natural desert anyway with water stress always an issue. These Olympics might leave a legacy of this situation being worse.
Japanese inflation came in at +0.8% in December and higher than for November. But their core inflation rate was unchanged at +0.5% although that is its post-pandemic high.
Hong Kong business confidence (as measured in a Hong Kong Government survey) is flat. But at least it isn't retreating.
Consumer sentiment is flagging again in the EU as well.
In Germany, their new coalition government wants to attract 400,000 qualified worker immigrants per year to tackle both a demographic imbalance and labour shortages in key sectors that risk undermining the recovery from the pandemic.
In Australia, some key analysts are now saying that the RBA will abandon its current no-rate-change settings much sooner than anticipated, with rate rises to start in 2022. Westpac sees two hikes in 2022 from the current 0.10% and a regular set until 2024. ANZ agrees with Westpac that all this guidance will change at the RBA meeting on February 1, 2022 (tomorrow week). But the new expected track is far slower than what is proposed for New Zealand by the RBNZ which is already well down the path the Aussies are contemplating.
In NSW, there were 20,324 new community cases reported yesterday, a rise again, now with 238,645 active locally-acquired cases, but a high 34 daily deaths. There are now 2,712 in hospital there. In Victoria they reported 13,0917 more new infections yesterday, a fall. There are now 191,058 active cases in that state - and there were 14 more deaths. Queensland is reporting 11,947 new cases and 10 more deaths. In South Australia, new cases have slipped to 2,062 yesterday with no more deaths. The ACT has 694 new cases with no deaths and Tasmania 625 new cases. Overall in Australia, 48,979 new cases have been reported.
The UST 10yr yield opens today at 1.77% and up +1 bp from this time Saturday and the same level as this time last week. The UST 2-10 rate curve starts today unchanged at +75 bps. Their 1-5 curve is little-changed at +101 bps, while their 3m-10 year curve is also little-changed at +171 bps. The Australian Govt ten year benchmark rate is down -2 bps at 1.88%. The China Govt ten year bond is unchanged at 2.73%. The New Zealand Govt ten year is unchanged at 2.52%. A week ago it was at 2.47 so it up a net +5 bps since then.
The price of gold starts today at US$1836/oz and +US$4 firmer than where we left it on Saturday.
And oil prices start today lower by about -50 USc at just over US$84.50/bbl in the US, while the international Brent price is now just over US$87/bbl. For the week that is a +US$2/bbl rise however.
The Kiwi dollar will open today weaker again at 67.1 USc. Against the Australian dollar we are firmish at 93.7 AUc. Against the euro we are a tad lower at 59.2 euro cents. That means our TWI-5 starts the week at 71.6, unchanged from where we left it on Saturday but with a -0.9% devaluation in a week and a -1.6% devaluation since the start of the year.
The bitcoin price has moved lower again, down -8.2% to US$35,297, most of that on Saturday. Volatility over the past 24 hours has been moderate at +/- 2.7%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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95 Comments
Before we all start fighting like Muhammad Ali over Covid, I want to pose a serious question: What are your cost of living hacks?
Everything is skyrocketing in price at the moment (apart from my $hitcoin collection ... what do you mean dog tokens aren't a robust asset class?) so what can the average Kiwi do to stretch the dollar further?
There are some clever commenters on here - yours truly excluded - so I'm sure we can crowdsource some good info and insight.
My tip is to look on Amazon.com (NOT the Australian Amazon but the actual American site) if looking to buy small, lightweight items. For example, I buy dog toys for the hound. A dog toy that costs $40 here from Animates is still half the price, even when factoring in shipping - and Amazon US shipping is often quite quick.
Items I've saved big on this way include dog toys & accessories, boxing gloves for the gym, computer memory, headphones, keyboards and mice.
Doesn't work well for heavy items.
One more tip is if you buy multiple smaller items they will generally combine the postage so you split the shipping cost across the items and save further.
The biggest saving for me have been because I'm a zero paid specialist. If your a really practical person and can do anything from repairing your own car to building a retaining wall then the accumulated savings are huge. I have had to pay someone to do a job like 5 times in my life, mainly welding because I don't have the gear or the skill level to do a perfect job of it.
Welding is a very handy skill to learn. Also you can get a reasonably good quality welder pretty cheap nowadays, even second hand is ok.
There might be a short polytechnic course you could do? Otherwise find someone to teach you. For just handyman type stuff it's not too difficult.
There's an interesting organisation out there called Menzshed (men's shed) where volunteers contribute equipment and a facility and basically help each other upskill and build/create stuff. An aim is also to build connection and community, including cross-generation.
Welding is actually incredibly difficult. If you want a finish like you see on a bike frame its a total art form. Like anything else it takes years with different levels of certification. Anyone can pick up the gear but the result is seagull shit on steel. Most of my stuff was Aluminum welding, that's next level when you want a box welded up that can hold water or you alloy car wheel crack welded, you want someone that's been doing it for 20 years.
I would only buy Japanese.
And of those, Toyota and Honda are the best of the best. Toyota makes the most cars and Honda makes the most engines - they know a thing or two more than the other Japanese and Korean makes.
European or American vehicles are just too unreliable and expensive to fix.
Especially when they've gone over 80k kms.
Opshops
Fix stuff instead of buying replacements
Use your local library
Phone your bank/electricity/internet provider and tell them you're going to move if they can't give you a better deal (better if you have another offer for them to beat)
Never shop at New World
Walk or bike
I guess not every tip is aimed at every one.
My drive to work used to take 10 minutes to the car park, then 8 minutes to walk to the office. I started cycling on a hardtail mountain bike (so I could hop kerbs in an emergency), and before long it took me 12 minutes on a good day from home to the office. A quick shower when I got there, and call it even. I dropped 7kg, gained a lot of muscle, and never had so much energy. Sometimes I could even keep pace with experienced riders on carbon fibre road bikes.
It cost me $500 for the bike, the odd inner tube every now and then, and a couple of new tyres. It rained, I got wet but didn't melt. It was sub-zero, I warmed up quickly by riding harder. It was 30+ degrees, I had a quick drink on the way. I rode in rugby shorts and a t-shirt, with my office attire in a waterproof bag. I rode over 35,000km over the years just commuting, and only once had a near miss.
Once you factor in traffic, finding a parking space and walking from the carpark to work, it is actually quicker for me to bike the 10km to my Chch CBD work. And if your time is actually valuable, you should probably not be commuting for an hour = 2 hrs/ day, 10hrs/ week, 480hrs (or about 60 extra 8hr days) per year.
We do a lot of the same, plus visit the local auctions rather than go on TradeMe. People pay thousands for a TV they upgrade 3 years later, only to sell it at auction for $400. I'll cop 3 year old tech for a huge saving, thanks. They also often last a lot longer than people seem to think they do.
Hold onto items til they die, or cannot perform the function you require. Do you really need a bigger TV? Can you really not live without the difference between 4K and OLED?
I have a large selection of quality tools I've picked up from auctions of deceased estates for pennies in the dollar. Metabo hammer drill that'll whack a hole through Spacetime? $20 because no one else in the room has heard of the brand and will pay $200 for a Ryobi instead. Disassembled Stihl chainsaw with a 20in bar that just needs a new gasket and chain? $50.
DIY is king, and incredibly fulfilling. YouTube has a clip for just about everything.
A lot of money is wasted on trying to impress other people. So what if your neighbour bought a new widget and yours is 10 years old? Live sufficiently. As a side benefit, the planet might even last a little longer.
Tools, drools....
Best recent buys:
- Taurus toolbelt for $100: $250 new.
- Masport 5 horse two speed extended tine set Rota-hoe $2. Sold as not going, no spark, popped flywheel and filed points, changed engine and drive oils, has not stopped since. Refurbishment cost $1.04 for a flywheel key, $36 for a drive belt, $15 for oils.
- Hitachi 36v brushless drill, $80 under new retail for a scarcely used 2nd hand. Old 18v cartridge battery drill seized (gearbox) and will supply a battery mount and switch for an upcoming repower of an otherwise useless B&D pole saw.
Trademe auctions occasionally misdescribe and thus underrate the goods......
I bought a 55" Sony LED HD TV back in 2009, still using it today. Would be nice to have 4K for my gaming console but otherwise, am still very happy with it...
Used to play the upgrade game for computers and digital cameras, can't be bothered any more. Capabilities have levelled off compared to 10 years ago, so no point having more RAM or more pixels. It's what you do with it, rather than what you have that matters...
I mentioned a while ago about the possibility of heading into an era of frugality and live as our grandparents did, minimalist but ultimately happy lives on the whole.
I am probably viewed as frugal in the current environment although nothing compared to a few generations ago. We live in a world where endless consumerism is aggressively promoted to fuel continued growth/profits and the utopia of wealth but I think we are starting to see that wealth/debt and all the toys you can wish for will not necessarily make for a happier life.
We are climbing over each other chasing the wealth dream at any cost, leaving many behind and accelerating the demise of communities, family's and social structures. Cheap money and Covid is just fuel on the fire and we are now in a position where many 'feel' wealthy and live lives of relative luxury but alas it is all smoke and mirrors driven by massive debt. The only way out for 'all' of us is a very big 'correction' whatever that may be.
Smudge you have hit it out of the park mate . We own a small 2 beder in Otago , hope its still there.
Dont own a car or phone (wife does) , its taken me 60 years to work out the less stuff (crap) l have
the happier and free'er we are . we spend most of the year overseas Housesitting & staying with
family & friends . very low budget . less is more . makes life easy
I reckon appreciation for this and for minimalism in many areas is starting to grow exponentially.
One reason is that some people have realised the only reason many of them were working multiple jobs or had both parents working and were paying for childcare was to buy more stuff. But they don't need more stuff. The Antiwork movement that has sprung up seems to be a backlash against both exploitative employer practices and the drive for stuff that might have led folk to put up with such practices.
Another reason is that consumerism is incredibly destructive to the world and our climate, and younger folk are reacting to that.
A third reason I suspect is a loss of optimism. Young people are seeing a complete lack of action and intent from many in government and companies to take seriously the issues that will impact young people - e.g. pollution, loss of biota, climate change. Greenwashing and deferral instead of meaningful action, designing for obsolesence rather than longevity. This depresses them and also serves to undermine the desire for things. What point is there in buying something flashy or unnecessary when the most important issues aren't being taken seriously? It's easy to be optimistic and seek more when the future looks rosy and bright.
Consumerism has been built on debt we expect the following generations to pay - both through selling them expensive houses to enrich ourselves, and through the pollution costs we leave them to deal with. Why would they buy into that when they see the lack of seriousness or intergenerational thinking from their elders?
Thanks for the suggestion and tips.
1) Don't waste leftovers - put them in the fridge, add a few leaves from the garden and a slice of bread and that is lunch and dinner.
2) Also, let some things go to seed in the garden - if you keep up with weeding it can run partly automatically without buying seedlings or new seed.
3) And save seed late in the season off plants that have produced it, use it in spring. Lettuce and spinach is easy.
4) Never buy clothes - they come as gifts and last for 45 years, plus a second life as sport and garden wear.
5) Combine trips to save gas (and time) - build up a list of what is needed, do without it for a while and get it all at once.
Right, done. How about that COVID, eh?
Yep - buy via metamask and pancakeswap
Poocoin for monitoring pricing.
Been doing it long enough to have some semblance of what might actually have value and what is just a rug waiting to happen. Shibonk is the only one I have any faith in that is on BSC. Really is just money I am prepared to completely lose, no better or no worse than buying a lotto ticket, imo.
Never bought a thing on Amazon, the items I looked at the freight just kills it. Everything I get is on E-Bay and generally the shipping is free. No idea how the Chinese can do it to be honest, tracked via the likes of China Post, SpeedPAK and typically here in 2 weeks. Ideal for all small items and now its got to the point I cannot even be bothered shopping local unless its really urgent. Pricing is typically half to a quarter of what it is locally and some lowcost goods arrive for less than the cost of a local courier alone. From semiconductors out of Taiwan to a new toilet flush valve, for anything thats made in China its great, if the genuine product is not made in China then its probably fake however.
Depends Carlos. A pair of cargo shorts. Mainstream NZ department store $79. Flimsy, thin cotton poor stitching, two side pockets. By Amazon delivered $61 heavy drill, strong stitching five side pockets. You need to wade thru all the reviews & see which brand pops up with best price & shipping cost.
My #1 tip is about spend on things other than necessities.
Tip: You get 95% of the enjoyment of shopping from product research and window shopping, and actually buying adds little. And most things, you persuade yourself you need them when in actual fact you don't. Buying stuff doesn't satisfy, which is why you quickly move to researching the next purchase.
You only get satisfaction through craft and creation, investing effort to achieve.
Germany’s quest for 400k skilled immigrant workers annually is somewhat puzzling even taking into account the looming level of retirees. Have the 800k or so Syrians, plus others, been up skilled already been absorbed into the work force. Perhaps this signals Germany as with other traditional industrial nations, is looking to become more self sufficient. Meanwhile ,not all that far away in the north east, Ukraine continues to simmer. Not helped by a US President not clear in his mind, on the difference between an incursion and an invasion, issuing contradictions aplenty when stiffening up would seem opportune.
Germany's experience with Syrian immigrants is mixed. The Maybe Good: - about 25% of Syrian graduates left the country and Germany took the pick of them. Good for Germany. Maybe not so Good: - Adult immigrants from Syria who are unemployable not because they can't learn the language but because they are illiterate in any language. If Syria recovers the genuine skilled immigrants may choose return to their home but will those who are permanent beneficiaries?
NZ has a weakened version of the same issue because our definition of skilled includes brain surgeon, tour guide, bottle shop manager, chef.
Not helped by a US President not clear in his mind, on the difference between an incursion and an invasion, issuing contradictions aplenty when stiffening up would seem opportune.
What!! - replay this tactic against a better armed and defended nuclear superpower?
Russia could employ the same tactic - If NATO attacks, Russia will knock UK out first, all others will fall like dominos
The whole thing is a stupid situation. There is no way that the Ukraine should ever be a NATO member, its just provocation. The USA got upset when missiles went into Cuba and thats not even a land border with the USA. Ukraine is basically part of Russia, leave it the hell alone its not worth fighting over. Just tell the Russians the Ukraine will never join NATO, problem solved and all the troops can go home.
Strategically he may have his eye on Odessa. Needs another warm water port. The Russian fleet of nuke subs is vastly under strength compared to the USA & allies. Subs need maintenance & they need to be ready & handily positioned to any potential action. Mind you, still have to navigate the Bosphorus. Plenty of tricky history there.
Meanwhile China moved in a while back - https://thediplomat.com/2018/06/ukraine-china-flexes-its-investment-mus…
No doubt about it. China has moved steadily & purposefully, with Russia riding side saddle. From Myanmar, Pakistan, & Afghanistan now, Iran, Syria. A massive swathe of territorial interest & influence, potentially Iraq & work in progress Lebanon, from the sub continent to the Mediterranean.
The US Conference Board leading index is marginally better for December, and they see US 2022 real growth at a healthy +3.5%. The Atlanta Fed's view is the US economy is expanding currently at a fast +5% pa rate, and the current blue chip consensus is even above that.
Or don't guess and read what JPM now expects: "we forecast growth decelerated from a 7.0% q/q saar in 4Q21 to a trend like 1.5% in 1Q22." It's not just retail sales, however, or that recent Empire Fed Manufacturing Survey, which just suffered its 3rd biggest monthly drop in history (with only March and April 2020 worse)...
.. more locally, initial claims surged 55k to 286k in the week ending January 15, their third straight increase and the highest weekly reading since October. Link
V:1.0 Cheer up chaps. Stiff upper lip & all that. Tough times make for tough people. Too many snowflakes & all that. You get the picture. Got to have a good show. What's that? We've cancelled all the shows?
V:2.0 The lad(d)ies in the beehive have got it all under control. And that Reserve Bank fellow Mr Orr-some will print morr sums & house prices will keep on going up. Such a decent fellow, what.
V:3.0 Continue the illusion & confusion.
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