US Q4 expansion stellar; US durable goods orders strong; China's New Year travel plans fraught; China 'wins' at WTO vs the US, but faces EU bullying claim; UST 10yr 1.78%; oil soft but gold drops; NZ$1 = 65.9 USc; TWI-5 = 71

NZD falling again greenback and swaps going up. The cost to borrow will keep going up in NZ.

On top of it, most houses in NZ are in million+ dollar category. Average Salary is in sub 60k category /year. Inflation is high and price of necessities is going up. Paying 15% GST on food.

What will happen to our country and happy people?

Probably we should all just go on benefit and let taxpayers take care of us. Who will pay taxes if no one works? Yeah the Benefit are also taxed so I think it should be fine? Tax Benefits Tax is good cyclical economy. 

They way the RBNZ are responding (way too slowly), we may see 10% mortgage rates if inflation spirals out of control because of their inaction.

I'd consider regularly reviewing and updating the tax rates on individual earnings more than once a decade to be doing the bare minimum in terms of administration, but apparently they're not interested in doing that. 

Certainly 15% GST will keep on giving them more since all items are 20% expensive. So inflation is a good thing for government taxes. As Biden said inflation is a good thing. It makes richer more rich. Poor are down the slavery lane forever. 

Exactly. Rubbing his hands with glee.

If any party was going to do what's useful and fair they'd reduce income tax and raise land value tax on the unimproved value of land instead...

Hard task to find a useful party in NZ at the moment.

taim . stock markets falling 10% is just part of the cycle , happens most years , its healthy . betcha the Dow will be higher at xmas than todays 34k . Big prob is our dollar is in the toilet and dropping , interest rates need to go up now , $4 gas will kill our economy 

Further humour can be found in looking at the dumb spending.  Large, dreamt-up numbers, "allocated" to problems but with no vision or direction on solutions the money is not close to spent, see mental health, health generally, housing, roading, you know the little things.

The flag referendum was a disgrace - that money could have been better spent on half a cycle bridge plan, half a media bribe or 0.5% of a Climate Emergency Response/Slush Fund.

Shows me National doesn't understand the economy very well. Sure there has been wasteful government spending, as in all governments I remember, but the effect it has on CPI inflation is not significant.

You mean changing the flag which no one wanted to do, even though it was also Labour policy at the time? Or the cost of the referendum itself, as in the problem was we actually asked New Zealanders what they thought?

I somehow think that people would not have applauded him for fiscal prudence had he just declared, the flag was being changed to a certain design (other than Laser Kiwi, which I'm pretty sure we would all have been cool with). 

More followers than leaders in this country, hence the flag didn't change. How long be slaves of the queen? The kingdom?? 

and how many times in short order? in algebra two minuses make a plus not much else in life does.  Similarly in fiscal policy, in defiance of accepted physics, what goes down fast can soon need to go up fast.

Yeah well .5% ain’t going to do a thing.

whilst the rbnz are working on there numbers the banks will be working out there new stress test numbers... that’s where the rubber will hit the road 

anyone know or hazard a guess?

Absolutely, he needs to whack it hard and early. If he raises 0.5 in Feb, it will ensure that most people refinancing this year will be doing so at much higher rates, taking heat out of the economy.

I think he should do 75 BPs, for that reason. Bet he won't, though.

Link to that Xi point:

https://www.afr.com/world/asia/don-t-raise-interest-rates-china-s-xi-te…;

Exactly. The RBNZ clowns can only delay the inevitable. Ultimately, it is international fixed rates markets that dictate the interest rates settings in NZ. 

The only thing the RBNZ did was to bury their heads under the sand and make the problem worse by pretending that the current monetary settings were not catastrophically and un-necessarily ultra-loose. Now, they will be forced to go much higher with interest rates than otherwise would have been necessary. The more timid they are, the longer they wait, the higher interest rates will have to go later on. It is already almost too late and an OCR peak at 4% is, in my opinion, a very clear possibility, with risks all on the upside.

With their incompetence and shortsightedness they are creating exactly what they are paid not to cause: financial instability, inflation and wild swings in the rates markets. 

The fact that Orr has not been sacked yet is something that really baffles me. 

Yeah, agreed. We are quite dependent on our import as we have less productive industries here. Technology used to be one of the good ones here in New Zealand until quite some famous firms being sold to oversea buyers, like weta cave, while our local investors have been busy with snapping up properties here. Education and Tourism industries are crippled. Only agriculture and construction left. Agriculture is doing alright, but construction is heavily relying on import. If other central banks moving up their rates, we will have to too, no choice.

Exactly its all eyes on the FED because little old NZ is but a cork in the ocean. Once the cost of borrowing starts taking off its outside of of our governments control.

No one is immune to greed. When many stocks had fallen 60% to 80%, normal thinking is that it can't go lower, example a stock that was $45  had fallen to $8.5 and many thought, it cannot get worse as company has 800 million cash reserve and is debt free but today in just a week or two is at $4.5.

So anyone who bought at $8.5 thinking that after 80% fall is safe, Is  down by 50% and even this downfall has not stopped yet.

Also, one of the points of high speed rail is that it doesn't stop much. So if you want high-speed Auckland to Hamilton it can't stop every 10k in the new burbs along the way. Then it's a slow train again.

Indeed. I'm not so keen on the tunneled option (just take the free parking off the street) but the LR should be about intensification and less reliance on cars - as Simeon Brown says, to "give people a choice".

The $14B option is only $14B because the government chose the most expensive option, and demanded that surface running light rail price in a whole bunch of property purchases alongside the central Auckland route (some of the most expensive real estate in the country) that it didn't actually need.

The initial Auckland Council proposal was $5b for three street level routes through the isthmus. 

The 2017 election policy was $6b for both the North West and CC2M route.

Then Wellington paper-shufflers got hold of it, blew the scope out, just dropped the North West entirely and chose the most expensive option - and are now trying to tell us the real attraction is the poor, hard-done-by North Shore who got a busway over a decade ago is going to get some apparently badly needed infrastructure.  

I'd suggest this is so far removed from what got them elected in terms of cost and scale that they have no democratic mandate for this, and I was a huge fan of the original proposal. 

So everything little old NZ does to reduce greenhouse gases is basically offset by these guys in about 1 day. Like pushing Sh** uphill with a spoon.

And those exchanges of value won't trouble the swift system. lowering this leverage  Add Iran and associated vassal states (north africa, syria, lebanon, north korea, bulgaria etc) and you have an energy supply powerhouse.