A review of things you need to know before you sign off on Monday; chunky mortgage and TD moves by 2 banks, retail spending stalls, Rebecca Stevenson joins, swaps up, NZD stable, & more

Or they get a good thrashing

:)

Who knows? I joined here to bring the true (Limits to Growth, energy-underwrites everything to what I thought was the best econ-journo in the country. I worked on him hard. Politely  - as always - but hard. More than a decade later, he partook in an RNZ Two Cent's Worth with Giles Beckford and Jenee Tibshraeny, re Doughnut Economics/Raworth. For their pathetic (unjournalistic by several orders of magnitude) comments late in that piece, both the former should hang their heads in shame.

RNZ currently is base-jumping down a woke rabbit-hole, as are most Govt-associated entities. My posit is that this is subconscious denial-slash-virtue-signalling (and orders-of-magnitude away from real truth-seeking journalism.

If this person is happy to learn, fine. Here's hoping....

Chinese bankers, Chinese military. Very similar animals.

Heaps of people can grow all the food we need. A small minority are trying to stop them, and have found an excuse. Ask the Russians what it was like having consistent food shortages for years on end, because the conditions under which plenty of food could be grown for Russian consumption were artificially taken away by their government. It is something that we cannot put up with.

Let me help you: "Wij zullen deze veranderingen niet tolereren!"

That’s the country and government that some here fawn over…

Maybe the Brits can learn a thing or 2 from us Kiwis on how to grow the economy without worrying about productivity gains:

- dish out tertiary charters to anyone wanting to run an institution, never mind even if it is a barn on a berry farm

- provide 2-3 year working rights to everyone graduating and several points towards PR

- reduce the minimum term spent in the country to gain PR down to zero

A high level of liquidity preference, the low level even lack of economic growth to provide opportunity causes investors to seek refuge in what they consider to be safe liquid assets. The consequential rise in sovereign bond prices reduces term interest rates, which in turn increases the discounted present value of cash flows associated with all assets and liabilities, but not much else.

This is what Milton Friedman called the interest rate fallacy, and it indeed refuses to die. We can tell what monetary conditions are in the real economy, as opposed to financial liquidity, though the two can be linked, by the general level of interest rates. When money is plentiful, interest rates will be high not low; and when money is restricted, interest rates will be low not high. The reason is as Wicksell described more than a century ago:

"[The natural rate] is never high or low in itself, but only in relation to the profit which people can make with the money in their hands, and this, of course, varies. In good times, when trade is brisk, the rate of profit is high, and, what is of great consequence, is generally expected to remain high; in periods of depression it is low, and expected to remain low.

When nominal profits are expected to be robust, holders of money must be compensated for lending it out by higher interest rates. Thus, the same holds for inflationary circumstances, where nominal profits follow the rate of consumer prices. During the Great Inflation, interest rates weren’t low at all, they were through the roof well into double digits and higher by 1980. At the opposite end in the Great Depression, interest rates were low and stayed there because, as Wicksell wrote, the rate of profit was low and was expected to be low well into the future. High quality borrowers were given as much money as they could want while the rest of the economy was deprived of funds; liquidity and safety being the only preferences in what sounds entirely familiar.

Friedman pointed out the basic, non-trivial distinction between a liquidity effect and an income effect. Low rates can be stimulative in the short run (the liquidity effect), but over the long run their persistence means something far different. A yield curve is supposed to be upward sloping given the core time value of money and investing. That arises from opportunity cost, meaning the more plentiful the opportunities the greater the time value and the steeper the curve (the income effect). Yield and/or money curves (the eurodollar curve and even the history of the OIS curve) that collapse and remain that way unambiguously demonstrate that "stimulus" deserves only the quotation marks.

The more only the government can borrow, the more only the government does borrow. And the more the government does borrow, the harder it is to get the economy growing The more difficult it is for meaningful growth, the more banks will only lend to the government. Link

In the 1980s we had on TV “Whoops Apocalypse.” Forty years later,  in the same vein,  we have here the 6th Labour government.

Wouldn’t it be nice to here the truth from politicians for a change? 

Just say there’s a healthcare crisis for God’s sake. It’s ok if you say it’s due to the failures of successive governments, we know it’s not just because of you ( the current government). 

Acknowledging the crisis is the first key step to resolving the crisis…

Acknowledge the crisis and then announce an urgent, ambitious but realistic plan to start turning it around.

Remember when WHO told us it wasn't a pandemic too... took an unbelievable length of time for them to admit (Yess admit) it.