The economy was weaker than expected in the March quarter, with GDP falling by 0.2%.
Economists' estimates had been a result anywhere from flat (zero growth) to positive growth of 0.8%, while the Reserve Bank had forecast 0.7% growth.
The fact the economy has shrunk in the first quarter of the year will inevitably throw a lot of attention on to the performance of the economy in the second quarter that we are now in. The 'technical' description of a recession is two consecutive quarters of negative growth - so if the economy goes backwards in the June quarter we will technically be in recession.
However, economists at this stage are expecting economic results will be better in the June quarter. The RBNZ is not forecasting the country to go into a recession and Finance Minister Grant Robertson has said he believes the country will avoid recession. The fact the economy has gone backwards in the March quarter is unlikely to deter the RBNZ from continuing to push interest rates up - as it is hell bent on curbing New Zealand's high inflation (with the annual rate of 6.9% as of March).
In response to Thursday's figures, Robertson said "the volatile global situation" had been reflected in the quarterly GDP figures, "although strong annual growth [it was 5.1%] shows New Zealand is still well positioned to deal with the challenging global environment".
National Party finance spokesperson Nicola Willis fired back with: "The economic picture was already dark with record-high inflation, rapidly rising interest rates and wages falling behind, and today’s figures prove the toll that is taking across the country."
Kiwibank's economics team of chief economist Jarrod Kerr, senior economist Jeremy Couchman and economist Mary Jo Vergara said they expected to see a bounce back in activity over the second quarter – a natural rebound following omicron.
"But it is the outlook into 2023 that has us worried. The current inflationary and rising interest rate environment is eroding firms’ profitability and straining households’ budgets. Consumer and business confidence is in the doldrums, and forward indicators of activity have fallen once again. We’re not forecasting a recession for the NZ economy over the coming year but acknowledge risks of one are rising."
ANZ senior economist Miles Workman said the GDP data "are still riddled with Covid-related noise".
"...But underneath that we think domestic economic momentum is starting to slip. Interest rates are lifting, house prices are falling, inflation is eroding household incomes, migration is negative, and consumer confidence has tanked. However, we are unlikely to see these impacts in the headline GDP data until later in the year (after the Q2 release in September). And even then, the RBNZ will need to ask if this slowdown is sufficient to take the heat out of pipeline core inflation pressures," Workman said.
ASB economist Nat Keall and senior economist Mark Smith said risks to the inflation outlook "remain tilted to the upside for now", and the RBNZ would, before pausing interest rate hikes, want to be sure that the apparent slowdown in economic activity is genuine - rather than driven by statistical noise - and that this will flow through into lower capacity pressures and inflation.
"To us the regret from not getting on top of booming inflation outweighs that from potentially driving the economy into the ground. However, the RBNZ will be closely watching activity indicators as well as those for the labour market and inflation for cues. We expect a 50bp hike in July and a 3.50% OCR peak by the end of this year, with a weak economic outlook expected to trigger OCR cuts from 2024," they said.
Capital Economics Australia & New Zealand economist Ben Udy said the probability of a technical recession in the first half of 2022 is low as the Omicron wave had largely passed by the end of the first quarter. Retail sales have already rebounded 10% from their recent trough in February, while the gradual reopening of the border should provide a shot in the arm for services exports and the tourism sector. He's pencilled in a 1.3% quarter-quarter rise in GDP in the June quarter.
"Looking further ahead, the outlook is getting bleaker. Confidence has already slumped largely due to rising inflation and interest rates. While we think inflation is around its peak, we expect the RBNZ to raise the OCR aggressively over the rest of this year. And house prices are now plummeting. REINZ estimates that the median house price fell 3.6% m/m in May alone.
"That is set to weigh on household consumption and residential investment before long. While the near term outlook will be boosted by the impact of easing restrictions, we expect the growth to be sluggish further ahead."
BNZ's head of research Stephen Toplis says "noise, noise, noise and more noise", sums up New Zealand’s GDP data.
"GDP might have contracted 0.2% in Q1 2022 but the annual average expansion is still a massive 5.1%. Is this a bust or a boom?
"We reckon it will not be until we receive the news about the September quarter, which will be released in late December, that we will get a meaningful sense of how the economy is performing at the aggregate level."
On the details of Thursday's GDP release: The 0.2% decline in GDP for the March quarter followed a 3.0% rise in the December quarter, Statistics NZ said.
Stats NZ said primary industries drove the decrease in GDP, down 1.2% in the quarter. Goods producing industries also experienced a slight decline, down 0.1%.
Key facts
In the March 2022 quarter compared with the December 2021 quarter:
- GDP was down 0.2%
- primary industries fell 1.2%
- goods producing industries fell 0.1%
- service industries remained flat
- GDP per capita fell 0.2%
- real gross national disposable income fell 0.5%
- average annual GDP to March 2022 rose 5.1%.
"We saw lower output in the food, beverage, and tobacco manufacturing sub-industry; and the agriculture, forestry, and fishing industry," Stats national accounts industry and production senior manager Ruvani Ratnayake said.
"These declines corresponded to falls in related exports categories, including dairy products; meat products; agriculture and fishing products; and other food, beverage and tobacco products."
The service industry group, which makes up approximately two thirds of the economy, remained flat. This result reflects falls in some industries being offset by rises in others.
"The services industries saw a range of results in the March 2022 quarter. Education rose as early childcare centres were able to reopen to greater capacity, while activity in retail trade and transport support services was down in what is traditionally New Zealand’s peak tourist season," Ratnayake said.
The expenditure measure of GDP was down 0.1% this quarter.
A fall in net exports, driven by falling exports of goods and services, was offset by rises in household consumption expenditure, government expenditure, and gross fixed capital formation.
The change in economic activity came in a quarter marked by the community spread of the Omicron Covid-19 variant. The March 2022 quarter included low travel due to border restrictions. However, there were fewer domestic restrictions than in previous quarters.
Stats NZ stressed that Thursday's results represent "the first official estimate of economic activity" in the March 2022 quarter.
Stats NZ continued to "review methods and data sources" used in compiling GDP, and alternative data sources are used where required.
Stats NZ said economic activity has shown a greater degree of volatility since the March 2020 quarter due to the impacts of the Covid-19 pandemic and associated response measures.
Economic growth
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203 Comments
It depends when Omicron government policy is unwound. Bugger all to do with a bad flu season. If only these muppets had bothered to look at the Diamond Princess data and applied the Barrington Declaration focused protection, all of this pain and poverty could have been spared. Cure - let me introduce you to worse than the disease - and his good friend never-let-a-'crisis'-go-to-waste.
https://www.medrxiv.org/content/10.1101/2020.03.05.20031773v2.full.pdf
Agreed.
Anyone who expected +0.7% or +0.8% simply wasn't reading the signs.
Business NZ's PMI and PSI were both weak in the first three months of the year, and ANZ's business and consumer confidence measures were both heading south. Consumer spending wasn't that greater, allowing for inflation.
GDP deflator
You can't realistically increase productivity in such a labour-crunched market. In fact, we're heading in the opposite direction.
Most employers around the country are being forced to fill job openings with underqualified and underexperienced recruits, or promoting workers to early to prevent them from leaving.
A chippie mate of mine quit the industry after an injury in 2019. After a few months on ACC he did a coding boot camp. He is now earning 130k+ as an integration specialist. Personally not an expert, but you need more than 2 years of experience to be called a specialist in such a complex subfield.
I take no pleasure in being right. Leading indicators have been flashing downturn for a few months. People have slowed their spending, diverted what money they have to essential and often imported consumables (e.g. petrol), and there is clearly a greater proportion of disposable income being sucked out of the economy by banks, and low-spending landlords and shareholders. Less money moving more slowly in the economy = downturn.
In the coming months, prices are highly unlikely to fall, unemployment will rise, and money will increasingly flow to banks, low-spenders, and savers. Going to be a rough year.
Its been the avoidance of recessions that has caused inequality to increase....no decrease. Because the response to recession has been to bailout asset holders at the expense of non-asset owners.
I think if you talk to the average 'poor person', they've been experiencing depression like conditions GFC-now (can't afford a house, living pay cheque to pay cheque)....so the change in living conditions for them doesn't really change that much in 'good times' vs 'bad times'.
What you say is often the threats that I hear from those who have the most to lose (e.g. those highly leveraged against the housing market). They like to say that we can't possibly have a recession because 'look at what it will do to poor people'....when in reality what they mean is 'if there is a recession, we need maximum central bank and government intervention so that my investment portfolio doesn't drop in value".
I'm sure you mean well but you might have your cause and effect relationships around the wrong way. If avoiding recession was so good for poor people...then why do we have so many/an increasing number of people on welfare payments and receiving food bank support and levels of inequality that haven't been witnessed since the 1920's?
Or do you have a property portfolio and in an indirect way, are you want the central bank to save your investments (as I say I've met a number of people in the second camp....its a false display of empathy...)
Yes.
I'm aggravated how many Labour Party 'leftists' are arguing we shouldn't raise rates because it will be bad for employment.
Which is just another variation of the trickle-down argument which they can see, in other situations, is largely nonsense. It's arguing that we need to bail out the wealthiest members of society to protect some jobs they provide. Accelerate inequality, infinitely, and that's supposed to be a 'left' position. Let inflation make the bulk of the poor ever-poorer in real terms, to bail out property owners.
Labour are going to lose the next election, despite the utter uselessness of National, by gaslighting the public on inflation.
You assume wrong, I do not have a property portfolio. However, like 100% of New Zealanders, I do have "skin in the game". in my own way We have 1 modest home purchased in 2019 (pre-Covid), with a young family and work hard to pay our mortgage, the bills and put food on the table. A recession and rising inflation will hit us hard when our mortgage rate is next up for renewal. I have no problem with a fall in house prices to stabilise the system. More of my personal worry is around staying in work, not losing a job and not putting our mortgage in jeopardy.
But you are right about house prices and rising rent costs hurting the poorest in NZ for years. It is shocking how many people live in substandard housing and pay extraordinary amounts for.
New Zealand has been suffering from poor productivity for decades and this has really culminated in the last decade. Falling education standards relative to other OECD countries are only exacerbating the productivity challenge and is entrenching poverty in this country.
However I struggle to see how manufacturing a recession is going to help things. Falling asset prices should in theory become more affordable to everyday Kiwis, and if that was the case, I would embrace that every step of the way. But rising interest rates offset the falling asset prices, and assets remain out of reach to everyone unless they can afford them outright. Distressed assets will only end up in fewer and fewer hands, and when the economy bounces back, those new owners will be more influential over our economy than ever before and will continue to profit from our poor productivity record. The poor will get poor, and the middle class (which I place myself in), will continue to fall behind.
We need to face up to the productivity challenge if we really want to reduce inequality. Better education standards is a start. It is shameful what teachers get paid here, and there are few incentives for schools to reach the higher standards needed. There is no wonder why our standards are falling, and school absences are on the rise.
There is a long road ahead to making the economy fairer to all New Zealanders, it will take a decade or more to right things. Do we have a Government or any political party courageous enough to meet this challenge? They will reap the political reward in the long term if they do!
"However I struggle to see how manufacturing a recession is going to help things"
Central banks haven't manufactured a recession. They have kicked the can down the road and likely prevented depressions in 2008 and 2020 by bailing out asset holders at the expense of non-asset owners. They are now acting to keep inflation within their mandated band, just as they did in 2020 to avoid deflation. The difference is, that fighting deflation has been fantastic for asset holders....and now fighting inflation is going to be bad for asset holders. So we have different groups of people complaining at different times....(I don't recall many asset owners whinging back in 2020 as their mortgages got easier to service?)
The hardship you talk about are the side effects from central banks avoiding recession/depression......i.e. our debt levels are too highly relative to our productivity/income.
There is an easy way to fix that....have a recession an clear out the bad debt.....and bring debt levels back to more sustainable ratios in respect to income/GDP.
Daniel Kahneman has an interesting proposal about whether it is better to pull a bandaid off fast, or slow. I.e. do you prefer to experience a high intensity pain for a very short period of time, then get on with life. Or do you prefer to experience a lower intensity of pain, delaying your ability to get on with a pain free life?
Those who prefer the option of avoiding a recession are the the second camp (in my opinion). They want to avoid the high intensity pain, and as a consequence indirectly chose a lower intensity pain for a longer duration.
Of course the pain could be avoided completely, but that would require prudent economic management/policy/regulation....but that ship sailed years ago and now we're at sea with a storm on the horizon....
This doesn't need to be the case though, its just the way the current system is set up.
If we had a decent welfare system, if we had regulations to stop wealthy investors from scooping up houses from distressed homeowners, if the response to recessions was something other than pumping the assets prices of the already wealthy...
Exactly, it is the response to recession that is the problem.
And we never fixed the cause (typically a build up of non-productive debt that the real economy can't support).
As it stands, we've supported the creation of more of the problem (creation of non-productive debt) at the expense of the sustainable solution (encouraging real productive activity in the economy).
Completely agreed IO. If we have look at our historical GDP growth rates after GFC, our GDP growth rates have been pretty flat despite RBNZ's efforts of pumping up assets price. And our OCR has reduced from 8.25 to 0.25 during this period. So yeah, we never fixed the cause, the system is broken.
I am always amazed that people think recessions are somehow good for the economic soul of a country; as if downturns weed out the weak, or teach the workers who is boss, or whatever crap the narcissist economics professors teach their sheep.
Downturns lead to the unhealthy consolidation of market power, and cause abject misery as people are permanently scarred by losing their jobs and living in poverty. We do not have to manage the economy on a boom / bust cycle at all, and given that we are going to need to start reducing consumption to save the bloody planet, we had better start working out some new ways of doing things.
I think we might have reached peak crony capitalism simultaneously with peak chardonnay socialism.
The combination is the mess we find ourselves in.
But if you think avoiding recession is the solution then as you say we need massive reform so that the carrots and whips are much better aligned in order to achieve sustainable financial and social goals.
As it stands, the system and way of viewing the economy is very broken. It has been rewarding highly unethical behaviour (debt speculation) and punishing those who want to contribute to the real economy (income generating activities).
... scrap the Reserve Bank ... let the market sort out for itself where interest rates should be ... ... withdraw the backstop on banks , no one is " too big to fail " ... let the risk/reward ratio do its magic ... the " invisible hand " needs to be unshackled ...
Yes as risk of debt default increases, lending rates should increase (risk premium). e.g. in 2020.....but the opposite happened.
Instead when risk of default has increased, central banks have been fooling the markets and artifically dropping the lending rates allowing even less credit worthy people to load up with even more debt.
Its completely counter intuitive and stupid (in my view).
Running an economy based upon rising asset prices and the wealth effect is creating the conditions for eventual financial armageddon.
I've been to the square in Paris where the guillotines took off the heads of the privileged classes ... it led me to think , with the reserve banks meddling , we're heading towards a point where the poverty entrenched by their awful policies will cause history to repeat in some manner ...
... witness ram raids in NZ , child poverty rates soaring , gang membership up , drugs such as meth epidemic ... all juxtaposed against a backdrop of stratospheric house prices & rental costs ... the idle rich get richer , and the poor get increasingly stressed & desperate ...
Desperation is rising as the gap between the haves and the have nots widens and widens, End result already becoming somewhat prevalent. Put simply, if I haven’t got it and have no hope of getting it as I am, then the only way I can get it is to take it off someone who has got it.
Cuts both ways. Why should I drag my arse out of bed and take years off my life at an office job that barely covers the basics when I could not do that, spend more time with my family and just get everything given to me? Not only that, if I do choose to dabble in a spot of the old after-hours drive-through shopping, I likely won't be caught and I won't get much more than a stay at home order, which, given I can't afford to do anything other than stay at home anyway now, is a disincentive... how, exactly?
Imagine that we are moving into Stagflation.
Pretty obvious things are going from bad to worse and hard to see when we will come out the other end.
Big issue is that the RBNZ will have to continue to hike rates whilst running into a slowing economy - which will be dreadful for those on lower incomes.
This will very much test the mettle of the Govt - as a large part of their voting block will effectively be seeing net loss in purchasing power and will be feeling very much like they are going backwards.
The government is a sovereign currency issuer, it always spends before it taxes, currency must be created first before it can be taxed back and cancelled. Don't waste your time listening to mainstream economists, politicians and journalists.
https://www.levyinstitute.org/publications/can-taxes-and-bonds-finance-…
https://www.levyinstitute.org/pubs/Wray_Understanding_Modern.pdf
Omicron would definitely be a factor and may be the main one. However that will wear off. Probably Australia would have had the same impact during its waves so we could probably compare our gdp experience with theirs to check.
However given the gdp during the last couple of years has been affected by the deliberate wealth effect of rising house prices due to the low ocr . What % of the gdp fall is now due to the falling house prices , rising interest rates and consumers starting to spend less
The impact of omicron as you say is expected but will now taper off. The negative wealth effect is far more important to spot as it will accelerate. Is that not far more important to track as a % of gdp growth?
But admit that he is right, Omicron must have caused at least a 0.2% GDP decrease, so without Omicron we would have had growth.
As for "improvements later in the year", well that could happen in the next GDP figures as the Omicron impact is removed. But after that yes it is likely we will see either low GDP growth or negative.
Not putiing them down,or getting an erection thanks northman,just such a flippant comment that gets thrown out all the time"I'm on the first plane outta here..." good for them,it's been done since Adam was a boy,I hope my kids enjoy some time over seas or permanently if it suits.
Just stop trying to make out that Oz is some Nirvana that has got everything right,no issues.
If it didn't have the worlds biggest mineral deposits in landscapes that no one cares about digging a hole in,they would be struggling like every other country.
Probably because it's the safest, most boring life change someone could make.
The only people I've known who've made the move there and capitalised well from it have made one or several other adjustments to how they operate. Most just drag all the issues they had in NZ a few thousand Ks to the west.
Having lived and worked in NZ and Perth in my opinion the Australian system seems better set up for self improvement.
Over there you were able to claim back course costs etc against your income tax whereas here we only seem to let business owners/contractors have that benefit. (Even before the lower tax rates and "company" cars)
Not sure how it came about but to me that always stood out as one of the biggest differences...
:) It was a tongue-in-cheek comment, but since you ask:
UK. Have choice of Ancestry or skilled worker visa (work is already based there and registered for sponsorship) - skilled worker is considerably cheaper, but prefer Ancestry for ease of transition to citizenship (note: haven't really researched the skilled worker pathway that well, since we qualify for Ancestry).
This is, of course, all assuming nothing nuclear happens... ^^
Staying here while wife still has her job, as she absolutely loves what she's doing, and that's really important to me.
Since 2017? Yep - new job, new apartment, new EV. My wife and father were still alive then too, but I can’t blame Jacinda for their untimely demise. Apparently lots of you also did well in the housing market back then.
What else was different in 2017? Hmmm - no global pandemic, higher NZD, lower inflation, no war against Russia, lower oil prices, lower CO2 ppm, terrific US president. I definitely credit the Nats for all those things. Typical Jacinda - causing all the disasters since then. /s
... vaping shops have proliferated since 2017 ... gang membership is well up ... Nadia Lim took a bundle out of My Food Bag .... Feltchers are making a bundle on their monopoly of plasterboard ... petrol companies are fueling up on big margins ...
Yup ... there's glimmers of hope & joy in Godzone since 2017 ...
... you'll have to inform me further on that point ... I have a tendency to vague out whenever Tugger's name is mentioned ... 2008-2017 , what an incredible waste of an opportunity to make some positive changes , and to upgrade infrastructure .. . the Gnats dropped the ball big time ...
https://www.rnz.co.nz/news/business/461523/sir-john-key-to-partner-with…
Chow said partnering with the Keys gave Stonewood a new dimension.
"I'm very impressed by their vision and drive."
Sir John Key said he had a "passion" for real estate development and it was an attractive asset class, while Max Key said the partnership would "turbo-charge" the company's residential development interests.
"Stonewood Homes' proven track record, know-how in the new build space and its procurement strength means Stonewood Key Capital can really hit the ground running," the younger Key said.
The Chow brothers have had a colourful and varied business career, coming to prominence for their ownership of brothels before they moved to buy some assets of the failed Stonewood group in 2016.
Once again the reserve bank is wrong with its forecasts, no surprises there becoming quite consistent really. All the extra staff were taken on a few months ago for what ? Time some culling occurred I would start at the top . How can anybody continue to have faith in our reserve bank this would have to be hitting new records for incompetence the magnitude of the error in their forecast is huge 0.7% to a negative 0.2 !!@!@@
... regular influenza A is causing greater problems than Omicron ... folks forget , flu season usually has a death toll of 500 ( give or take ) in NZ ... 650 000 die worldwide annually , during the regular flu season ..
Our medical services are usually stretched in winter because of flu ... staff & patients ...
The flu will not be causing greater economic problems. For quite a long time in Q1 your whole family had to isolate just because one person was in the vicinity of someone with Covid. Surely that has to have massive impacts on GDP. Flights would have been almost empty, no tourism, etc. How anyone can think -0.2% is a bad result is beyond me.
I lost count of the times the RBNZ got it badly wrong.
Starting with their wrong forecasts, including their overcooking of the economy with their recklessly ultra-loose monetary policy of the last 3-4 years, and also not forgetting their stupid removal of the LVR constraints and their continuous breach of two of the main pillars of their mandate (financial stability and control of inflation). The RBNZ under Orr's management has been a sad circus, and it is time to change its management and to finally have somebody with the competence and the balls to make the hard decisions to restore stability and control currently dangerous levels of inflation.
Oil probably hits $130 a barrel in July when the U.S petroleum reserve is near drained and then the NZ government subsidies come to an end. Throw in the wealth collapse of NZ property and its a brutal 2nd half of 2022 inbound which moves into 2023. The incoming deflationary side effect in 2023 once inflation is tamed has only been experienced by the silent generation when they were young. No one else alive truly understands what is about to occur.
That's not deflation dude, that's way worse. There are all sorts of things stopping that from happening. I don't think there's a chance we'll see that level of carnage. But an unwinding to the late 1980s/early 1990s where NZ becomes a dreary dull place is incredibly likely. So, more like an economic crisis many millennials have already lived through.
We overcooked the low interest and money printing for a long time. Inflation resulted and wasnt taken seriously. To counter it the acceleration of ocr rises and money printed being extracted is too fast and is resulting in everyone getting caught with tons of stock at high prices.. the reports are starting now but will accelerate... see for example:
https://money.usnews.com/investing/news/articles/2022-06-14/arks-cathie…
There is a lot of early talk and more coming
Our own economy will likely see accelerating ocr and mortgage rises and a negative wealth effect from house price falls. People will stop spending and retailers will cancel back orders and have sales to dump their stock. The building industry and its supply chain is already seeing it start and builders will stop buying from their suppliers who will dump any excess inventory... some house builders will have to sell their new homes at lower prices etc.
Gdp growth for years has been driven by low interest and money printing. Its being removed in a flash... so we will see businesses and individuals fold quickly if they are over leveraged or surviving on low rates. There is minimal chance of bail out for most as governments will focus on banks.
The problem is the speed its happening means inventory and back order positions cant unwind at a controlled pace. For sure we will start to see some serious cracks appear..
I hope to be wrong. But suspect the news over 1-3 months will support this
The question will be....will we see even more monetary and fiscal intervention if/when this happens? And if this is the case....will inflation return with even more intensity? I.e. the Fed decide that the risk of hyperinflation (via excessive monetary intervention) is a more satisfactory option than depression. I think its a real possibility in the coming years.
Otherwise you might see the US default on their debt obligations.....but if they take that path.....they might cause numerous other nations around the world to default before them.
It's possible they want people to get as close to underwater as possible before they announce another round of easing, to try and make sure that at least some of goes towards balancing up existing debt and not just being thrown at assets by being used as a basis for leveraging. Really scaring the bejesus out of some people who seem to think taxpayer-underwritten gains is a god-given right might be in our best interest if we can target the assistance to get through it at home owners who don't want a bar of their garbage.
I think you have far too much hope....but then again I completely underestimated the extreme lengths that the Fed and RBNZ would go to in order to protect the debt pile in 2020....they are far more unpredictable (and insane) in my view than I ever thought possible. So who would limit the lengths they might go to in the future? But then again, perhaps its the central banks who have got the fright? They might be a bit more cautious next time around with their intervention as they are seeing now that they completely overcooked things back in 2020-2021.
We will need to have a real possiblity or deflation, or actual recorded deflation before we see further stimulus.
I mean as it stands, with real rates about -5%....we are still in a highly stimulatory monetary environment....and then add on all the additional fiscal spending to that.....so do we expect them to really do more until what?
I don't disagree with you HM - I think its quite possible we see a massive slump next year that where we potentially see deflation....question is, how much damage is done between now and then....and how insane will the monetary and fiscal policy be from rbnz/government in response? ......then further...what will the follow on impacts be of that intervention? (a big swing back to even more inflation as we increase money supply while producitivty is reduced - ie. things get worse than they are now?)
But if the statement is 'worst government in memory',this has to be compared to others to be valid...
JK said we would have pay parity with Australia,end the housing crisis & not raise taxes...then he increased GST and we know how the other 2 promises went,lets not pretend this isn't the first government to not achieve all it promised.
No one is saying the other governments weren't terrible. They are just saying this could be the worst.
If Key's govt saw the housing crisis go boom, Ardern's went full nuclear.
GST was a con, but you know who moaned the most about it? Well they are in power and I don't see any change, do you?
Every single thing this Govt has touched they have made worse, and not just slightly.
The only good bit of legislation in the last 5 years has come from ACT. I mean if that is not a indictment on Labour's Governance then I don't know what is.
Noncence,you are unwinding the statement which was that they are the worst...hard to quantify.
I think a lot of folk will think the legislation around removal of interest deductibility was one of the best things done for the future of housing affordability,but unfortunately Mr Luxon & co have vowed to reverse it.
Worst will always be subjective, I am sure there are some who think they have been awesome/mediocre/and worse than worst, and some whose memory may be 20 elections vs others with one. There are also the one eyed-supporters that will only ever say x team good, y team bad.
But taking a step back, this govt have gone from >50% majority, to mid 30s, in less than a single election cycle. The trend would suggest they will fall further still before the next election.
Yes we have seen both major parties both polling lower at various points, but no other govt in my political memory (MMP era) has dropped so quickly while in power.
1999 National dropped 5 seats when Labour took over.
2008 Labour dropped 7 seats when we switched back to National.
2017 National lost 4 seats (but still had more than Labour)
2023, based on current polling Labour could lose 20-30 seats.
So to me that alone would quantify "worst" in memory.
As you say,subjective.
You could say achieving 50% alone under MMP, a feat never seen before, history could judge them as the 'best' in history using your metrics.
You seem to have left out how many seats the Nats lost in 2020,what was that 20,21 seats?
I can't remember of the top of my head?
As for the future...lets see what 2023 brings.
$60,000,000,000 in Covid Spending. $30,000 per household. Anything less than an outright majority election win would have been a fail.
The bottom 40% vote Labor, Greens or not at all. The top 60% got all the extra money funneled up to them through increased house prices so they loved it.
No I didn't but I also wasn't a politician trying to point score by saying the other sides idea would let Covid in, and then being very quiet on it once Covid got in while my party was still in charge...
To qualify if National had said it I would treat it the same, to me both main parties are pretty interchangeable
I'd like that model. Let me know if you find it.
The thing is, we've got a market for lemons here. You either get washed out businesspeople for whom politics and its salary is a payrise, then you've got those who have made their money and are looking to play in the ultimate sandbox, or you get activists and student politicians. The people who might actually make a difference are either doing it somewhere else and getting paid better for it, or see politics as a hideous game of thrones.
The best politician is probably the person who is forced to do it but can't allow themselves to do a bad job.
Being over-run by Delta (with an unvaccinated population) would have been quite different compared to being over-run by Omicron (with a high percentage of the population vaccinated). I would comfortably bet money we'd have been 'slammed' by Delta if National were in government, as they were pushing for border re-opening at a ridiculously early point in the pandemic.
Probably a bit like a mate of mine. Incessant moaning about MIQ, testing, masks etc. Now the Government is removing the requirement for pre-departure tests (every level headed person knew that these requirements would only be a temporary measure) and it's "HAHAHA LOLOL THE GOVERNMENT BACKED DOWN".
No, I don't go near parliament. Too many politicians. Plus I like science and Data, you know what some people refer to as reality.
Based on today's NZ data.
- 25% of deaths >90 years old
- 58% of deaths >80 years old
- 95% of deaths >50 years old
US, UK, AUS, and EU all show similar percentages. So I don't know what rabbit hole you live in, but age is by far the most significant factor in Covid related deaths.
The problem is they fluffed Covid by their own measure i.e. telling us what was happening vs. what was actually happening. I don't really care about how other countries handled it, that's their problem. I'm sure as hell not going to accept that as an excuse-making exercise for the bits of our response that we were misled over, like border testing or vaccine access or ministry communications or contact tracing or MIQ exit-testing.... shall I go on?
The fact other places bottled their response doesn't make any of these things go away, or less their impact here.
I'm going to agree that they are the worst govt & worst PM I have ever seen, on the basis of never even hearing about 3 Waters, Co-Governance & More Maori Autonomy, than was ever mentioned in the Covid Election in 2020. That was only 20 months ago. These guys are sneaky & not to be trusted. Yes, I know the others are too, but there wont be the magnitude of underhand reforms & deforms within the Nats than we've seen with this lot.
Amazing how quickly this is all unfolding. The RBNZ will now have its OCR decision influenced by today's FED 0.75% increase. Anything less will put significant downward pressure on the NZ$ (and increase tradable inflation).
I remember a few months ago people arguing whether there would even be a 0.25% rise from the RBNZ. 0.5% now appears to be the minimum.
The momentum is frightening. Seems every week we are seeing worse financial data and reactions.
Irish property crash took about 5 years to bottom out: https://fred.stlouisfed.org/series/QIEN628BIS I wonder how quickly we can do it
New Zealand has 331 Billion in mortgage debt now. Is a 2% OCR and 4-5% mortgage rates beyond neutral? Last year the comfortably off 60% all felt so rich and Covid clever. Any coincidence the pre departure testing was scrapped today? Tourism is the great white hope now. But by the time the airlines can get NZ back on their schedules will there be anyone left in the world who can afford to visit?
If I was the Prime Minister I would have probably taken a sick day as well.
As a lay person I quite like most of the Japanese approach to their economy up until 1989. As described by the economist Richard Werner. Where the central bank basically instructed the commercial banks what part/s of the productive economy to lend to. Concentrating on that strategy.only and staying away from non-productive speculation. Worked rather well until the IMF influenced them to change the system.
Here we have the evidence. We are already in recession. Everybody has been feeling it.
How can these 'forecasters' at RBNZ be so wrong? No common sense?
How can keep hiking interest rates up when we already in recession?? Madness, ignorance, or deliberate destruction?
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