Here's our summary of key economic events overnight that affect New Zealand, with news markets are sensing that consumers are in better heart worldwide that they have been assuming.
First in the US there was a rise in mortgage applications last week, the second straight week of increase after mostly retreats in 2022. That was helped by a fall in mortgage interest rates, and its lowest since September. There is a bit of disconnect here because you will recall that the US Fed raised its policy rate by +50 bps last week.
However their existing home sales are still in retreat. They plunged -7.7% to an annual rate of 4.09 mln in November, and well below market forecasts of 4.2 mln. That is the tenth straight month of falling sales and the lowest level since May of 2020.
But the latest consumer sentiment indicator, this one from the US Conference Board, recorded a sharpish improvement, but only one reversing the November fall. It is this improvement that has energised the rise on Wall Street today.
Canadian CPI inflation inched down to 6.8% in November from a year ago which was a disappointment. Markets had expected to see a rate lower than this, with no change from October. The actual change from October was a very small increase, so the pace is definitely slowing.
There was another German consumer confidence indicator out overnight, this one from GfK, and it also recorded an easing in their negative sentiment. This confirms that Germans are a bit brighter about where things are heading.
In China, there is new evidence that they are reclaiming and building out disputed reefs, islands and land formations in the South China Sea in an exercise that is sure to alarm many countries there with overlapping claims. Over the past decade China has 'claimed' many such reefs and militarized them with ports, runways and other infrastructure.
Onshore, China is relenting and rolling out a Pfizer covid drug nationally - to overwhelming demand.
And we should note that Chinese developer bonds were sold down yesterday in an ominous move because that is despite Beijing's very expensive moves to prop up the sector. The State banks forced to support these developers are now nursing growing losses.
China and Australia have agreed to expand high-level talks by trade ministers, which could help pave the way for end to sanctions that crippled AU$20 billion worth of exports. The iron ore price rose on the friendlier development, which does seem odd given iron ore wasn't a product China sanctioned.
China’s efforts to intimidate Australia by slapping sanctions on exports discredited its credibility as a reliable trading partner, with apparently zero gain for Beijing. But perhaps the point was to intimidate others (like New Zealand?).
New Zealand recorded a November trade deficit of -$1.86 bln, widening from -$1.08 bln in November a year ago. Much higher energy costs have inflated out imports sharply. That helped propel imports up +26% from a year ago, along with new car imports. On the other hand, exports rose at a softer +18% rate year-on-year.
Our trade with China is now in deficit. In November 2021 we had a +$416 mln surplus and that has now turned to a -$61 mln deficit this year. Our small deficit with Australia a year ago has now grown to -$151 mln. Our -$111 mln deficit with the US has turned around to be a tiny +$1 mln surplus this year. But our 2021 +$19 mln surplus with Japan is now a -$355 mln deficit in November 2022. Car and fuel are all the story, although it is accentuated by flagging exports.
Spending on New Zealand credit cards was weak in November, up just +2.9% from a year ago and far less than inflation. Spending for the year to November was +7.5% above the equivalent prior year and pacing inflation, so this monthly November activity is a real sign consumers are pulling back. Meanwhile balances are +4.5% higher than a year ago, a second straight month of rising after 31 of the past 32 months had recorded paydown falls. But there is no real evidence that interest-bearing balances are rising.
The UST 10yr yield started today at 3.67%, and off -3 bps from this time yesterday. The UST 2-10 rate curve is less inverted at -54 bps. And their 1-5 curve is unchanged at -85 bps, while their 30 day-10yr curve is also less inverted, now at just -3 bps. The Australian ten year bond is up +4 bps at 3.73%. The China Govt ten year bond is little-changed at 2.90%. And the New Zealand Govt ten year will start today up +1 bp at 4.41%.
Wall Street has opened its Wednesday session up +1.4%. But overnight, European markets were up about +1.7% except Paris which was up more than +2%. Yesterday, Tokyo fell another -0.7%. Hong Kong was up +0.3%. And Shanghai fell -0.2% in its Wednesday session. The ASX200 ended up +1.3% and the NZX50 ended its Wednesday session up +0.4% on dwindling volume.
The price of gold will open today at US$1818/oz and down -US$2.
And oil prices start today up a sharpish +US$3.50 from this time yesterday at just over US$78/bbl in the US while the international Brent price is just under US$82.50/bbl.
The Kiwi dollar opened today at 62.8 USc and down another -½c. Against the Australian dollar we are down a full -1c at 93.9 AUc as optimism builds on its China trade. Against the euro we are little-changed at 59.3 euro cents. That all means our TWI-5 starts today at 71.2 and down another -40 bps.
The bitcoin price is now at US$16,798 and down a mere -0.2% from this time yesterday. Volatility over the past 24 hours has again been low at +/- 0.5%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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161 Comments
Down but not out. The Dow (and other US indices) have had a very normal breather on its run since late sept. Here comes the Santa Claus rally ??
Keep on blowing old soldier :)
There's no need, just let the facts tell the story. In terms of my cred I picked the bottom of the Dow early October, that is recorded here on int.
When's the next bottom?
To be fair, and factual HW2, you have also picked the bottom of the NZ housing market decline, every day this year !
Correction I said it is a good time to buy when there is fewer buyers and more sellers. It seems a lot of home buyers agree
Spose it depends on what you're buying also.
At the moment projects seem relatively cheap due to the market conditions, as in their values have dropped relatively more than something immediately liveable.
Not for everyone though.
Nifty1, do you want to add your 10 cents worth too?
Multiple people commenting on an online forum?
Won't someone stop the madness!
Nah, just a Spruiking Dad and his two kids.
So we're just relatives now, and not the same person?
I'm always flattered when I see my name mentioned in the comments section... Merry Christmas Retired Pop 🎅 try not to be the Grinch this year...
Yup, right on cue :) Merry Christmas to you and your multiple accounts. BTW, I'm not to blame for your interest bill. You will need to direct that grievance elsewhere.
This is what a troll looks like at 70 kids.
A tale of caution for us all.
So now I'm a Troll. We're probably all Trolls then. FYI, I'm actually 57!
All good :) Stay safe over the Christmas break and have a relaxing time.
edited.
Party on poppy.
You (the smart one) also said it was the right time to buy in Nov-21 too. Your credentials are worth bottling (sarc)
by HW2 | 22nd Nov 21, 8:59pm "If you are smart you will never ever lose from property, everyone's a winner baby.... almost everyone"
Absolute legend
Not really, I have a trusted friend who is up with this stuff
Will the belated introduction of Pfizer vs Omicron to covid the playing field in China reveal, and/or prove once and for all, that such a vaccine works by dint of resultant reduction in both infections and mortalities. That of course would depend on the CCP allowing true stats and facts to be published.
It will never happen its out of control now and China only count as a covid death if you die of Pneumonia not a heart attack. https://www.bbc.com/news/world-asia-64044204
Apparently there's now really long queues of cars at crematoriums there.
Few official deaths reported.
Our expectations about death from COVID-19 are based on a semi-functioning first world health system and almost universal vaccine uptake, China has neither.
How does India compare?
India had the advantage of the population being a lot younger and thinner than many places (and even then Covid caused chaos), I'm not sure how China compares demographically.
Do you not recall the scenes in India? Oxygen shortages and people not even being able to get into a hospital. The infrastructure they used to burn the bodies melting. I read estimates of over 4 million having died there.
"I read". You never experienced. Just like in the USA (I experienced), no excess deaths, hospitals empty, morgue's now full with the FEMA subsidy, hospitals only taking dubious government paying covid cases. But the best was my buddy upset I would not get vaccinated cause he had just bought a bunch of Pfizer stock. I think Americans are just smarter.
My friends mother died from covid early on in the pandemic. She was in her 60's and healthy otherwise. Wasn't vaccinated.
Well in countries that used these vaccines the all cause mortality is up 8-9%. That is right now in New Zealand too but no one wants to talk about it. I've been periodically downloading charts from the USCDC, same deal.
Is there an analysis by age groups Scarfie? ie is it higher in older or across the board, is there analysis in the cause of death
Yes most definitely, the age breakdown is what really tells the story. In the Covid waves in 2020 the death rate greatly increased , but in each age group the slope across the graph is upwards. It also increases with each age group, no surprises there. In 2021 the slope in the curve is reversed for the younger age groups, a bubble in deaths that did not translate to the over 65. It just happens that this wave of deaths started in week 30 of 2021, and vaccines started in earnest about week 25.
Strong correlation with vaccines. Not absolute proof, but strong enough that any serious scientist would want to look.
People like Painter below are just talking nonsense and spreading disinformation. Look at the data you have, not at what you don't have. It is also insulting to some of the countries that are perhaps not considered first world, but nevertheless have strong bureaucratic foundations thanks to their British origins. I think of Zambia, with which I have first hand experience. They are poor for sure, but I found better organisation and professionalism in the medical fraternity than in New Zealand.
Bottom line is something changed, and that something is killing people, the rate of deaths is perhaps a 3 sigma event (that is a pure guess), and that something isn't covid.
The silence is deafening.
Why don't we see similar in the European data? 0-14 death rates have basically been flat for the duration of the pandemic, 15-44 had a couple of blips but for most of 2022 has been comfortably in the normal range. Older groups had big spikes corresponding to Covid waves, as expected.
Where are you getting your data? I'd be going direct to the organisation that collates it. In the case of the USA it is the CDC. New Zealand I'm less certain who actually collects the data first hand, but I'm pretty sure that someone is getting getting it at the beginning of the chain and letting it be known.
Age related data from the US. Only children not seeing excess death.
"From April 2020 through at least the end of 2021, Americans died from non-Covid causes at an average annual rate 97,000 in excess of previous trends. Hypertension and heart disease deaths combined were elevated 32,000. Diabetes or obesity, drug-induced causes, and alcohol-induced causes were each elevated 12,000 to 15,000 above previous (upward) trends. Drug deaths especially followed an alarming trend, only to significantly exceed it during the pandemic to reach 108,000 for calendar year 2021.
...While Covid deaths overwhelmingly afflict senior citizens, absolute numbers of non-Covid excess deaths are similar for each of the 18-44, 45-64, and over-65 age groups, with essentially no aggregate excess deaths of children. Mortality from all causes during the pandemic was elevated 26 percent for working-age adults (18-64), as compared to 18 percent for the elderly. Other data on drug addictions, non-fatal shootings, weight gain, and cancer screenings point to a historic, yet largely unacknowledged, health emergency. "
Interesting, but it looks like they are talking more about the 'deaths of despair', deaths from drugs, alcohol, poor diet etc. No mention of vaccines in the paper. Still tragic and quite possibly poor outcomes from policy and there'll be some unpleasant cost/benefit calculations to be done. I certainly wouldn't argue there are zero deaths caused or brought forward by policy response to the pandemic, but I am skeptical of claims that the vaccine itself has caused more harm than good.
Incidentally, I think you were a little disparaging when I shared a non-peer reviewed NBER working paper claiming to show the efficiency of the vaccine by looking at excess deaths in Republican vs Democrat-dominated areas. They're certainly having fun digging through this data.
Do you also see "deaths of despair" in the NZ record excess death data linked below?
What is your take on Aussie excess death?
"Excess deaths in 2022 ‘incredibly high’ at 13 per cent
The Australian government should be urgently investigating the “incredibly high” 13 per cent excess death rate in 2022, the country’s peak actuarial body says."
...“Mortality doesn’t normally vary by more than 1 to 2 per cent, so 13 per cent is way higher than normal levels,” she said.
...She added, “In addition to Covid-19 deaths, there are significant numbers of non-Covid deaths – it is not clear what is causing these as there are many factors at play.”
https://www.news.com.au/lifestyle/health/health-problems/excess-deaths-…
Looks to be the same in NZ 0-14 year in deficit death and all older age groups in record excess death.
https://mpidr.shinyapps.io/stmortality/
"The increase in deaths in the June 2022 year (9.7 percent) was higher than the average annual increase over the previous decade (1.4 percent)."
https://www.stats.govt.nz/information-releases/births-and-deaths-year-e…
I can see a similar anomaly in there as the US Data. I don't know enough about the european vaccination rate to really know, but I'd say the wave of excess deaths late 21 and into 22 was a wave of vaccine deaths.
Draw a line through the peaks in excess death waves. The slope should be the same across all age groups but it isn't. It decreases, and reverses for 15-44's, as it drops through the age groups. That I call a smoking gun.
Given the way the vaccine was rolled out slowly and steadily over a period of months, why does the spike of claimed vaccine deaths only last a few weeks? Handily corresponding with a known wave of covid deaths in the EU?
Yeah, either that or the deaths are from that new virus going around.
The CDC is a privately run corporation. OK government sponsored and should not report deaths. Conflict of interest? The CDC 'experts' reports (manipulates) deaths for it's own benefit. Damn conspiracy theorist.
Your comment re Health systems is certainly pertinent. Very recent experience from Holland (November) was a shock to learn that while we generally consider they have a very good, progressive health system, in reality it is as fraught with issues as ours is. Some areas are better, but some are also very much worse. Eye opening indeed.
You only have to glance at media around the world to see exactly the same issues - in the UK nurses and paramedics are on strike, I've recently read of 12 hour waits at Melbourne childrens hospital, and every ED in Ontario being closed because they're at capacity.
We do not have a good progressive 'health' system. We have a country full of unhealthy people, obese, diabetic, cancerous, caused by a toxic chemically sprayed food system, devoid of nutrition, they lack exercise, sunlight, will put any pharmaceutical in their body thinking it will cure them, but hey that's eye opening.
how does this compare with Sweden ?
Sweden used vaccines, they just didn't do the lockdowns.
Most countries keeping records used vaccines fairly widely so it's hard to get a comparison.
So far it really looks more like excess covid related deaths and illness that aren't identified or reported, rather than the smoking gun of the vaccines are causing the excess deaths.
A bit of 'god of the gaps' going on for scarfie.
You wonder if the antivaxxers are going to stick to their principles and refuse mRNA cancer therapy as it becomes available, there's already very positive results out of Australia in treating advanced melanoma.
People with a healthy lifestyle don't get cancer or anything bad. And if they do they just have some detox and a few magic potions bought from Gwyneth Paltrow.
I wonder if that special candle helps.
My choice (as an anti-vaxxer) to refuse mRNA cancer therapy as it becomes available. You do not cure cancer. You prevent cancer. That is the best positive result.
Where are you getting your stats from Scarfie? MoH data stops at 2020.
Someone I follow has been getting the stats. But yes the general public don't have easy access. I'm sure David could get it if you wished.
USCDC you can go there yourself, hidden in plain sight. But I don't have a lot of faith that it will stay that way once word gets out. I've see data sets change since I've been on interest.co. M3 money for a start. Also the D3 series, total overseas liability, which used to reflect M3. USGS have fiddled the annual mineral summaries also since I started looking ten years ago.
Someone I follow has been getting the stats
Sounds reputable then.
Well you don't have it do you? So why are you even bothering to comment on something you have not a damn clue about? Until you know something for sure (I come pretty close with the USCDC data), then best to refrain eh.
I'm not the one trying to claim a causal link between vaccines and excess mortality levels.
I am and it needs to be looked into. All deaths should be reported as either vaccinated or unvaccinated, after all we are in the clinical trial stage of an experimental therapy. (it's not a vaccine).
Scarfie do you follow Dr Chris Martensons Peak Prosperity? He is very data driven.
Yes I've always followed Martensen, although I'm less inclined to sit through his videos. Some interesting information to be contained within his work, patterns if you like. 1. is that he has stopped appearing with regular articles on interest.co. 2. he started out very neutral on Covid, the data turned him to his current position. 3. His specialty as a professional is why people die, probably as good as you get for someone that can discern the truth.
As for painter above, confusion again between drawing attention to something vs proving it. I'd not go as far to say that vaccines are causing all those excess deaths. I would say they have a part to play.
What is absolutely certain is that there is excess mortality that is unexplained, you'd really have to be a bit of a dick to just explain it away when no one really knows.
I followed his podcast well before covid, environmental, energy sustainability stuff. I recall him raising the covid issue growing in China well before anyone else, well before msm etc and he warned of a potential global deadly pandemic. He was very frustrated at the slow US response at this time.
He changed when (as he calls it) the data changed. The science and data is well over my head, however I rate him due to his data focus and openness to change.
A good source for anyone who is interested,whatever their views.
Yes you are right, we don’t have it therefore we cannot afford you credibility without it. Not to say your theory isn’t totally without merit anecdotally but you see the need for information to back the theory up, otherwise who are we to know that this isn’t something your plumber casually said when doing a job for you recently.
I don't need to prove anything, I never got the vaccine. I never expected to get covid, and never did.
I published on here early on in Covid how to go about living a lifestyle that would prevent or mitigate it. I practice what I preach.
Stats just in today. For the USA the chance of death from the vaccine is 1:500. If you had the vaccine you should probably be concerned. Are you aware that Troponin is found in every person post vaccine? Indicating everyone that had the vaccine has heart damage of some sort.
How do you know you haven't had asymptomatic infection?
Can you please link to your source for 1 in 500 dead from vaccine?
That would be half a million dead in the USA from vaccine alone.
Joneses no. Having lived in the USA (greatest country in the world) during the 'Covid' years, I doubt 25 % were vaccinated. Very few in rural America, very few children, vulnerable told not to, pharmacists injecting dummies for profit, fake vaccine certificates, leaves about 50 million if they did not get a placebo, so right in line with a 10% rise in all-cause mortality. As I have said, deaths should be reported as having been vaccinated or not vaccinated to conclude this Pfizer experimental clinical trial.
tl;dr - too early to tell
What could be causing the non-COVID-19 excess deaths?
The measurement of higher numbers of deaths than predicted does not tell us why this is occurring. There are a number of reasons hypothesised around the world (where this effect is occurring to a greater or lesser extent). It isn’t possible to identify from death counts alone what is causing the non-COVID-19 excess deaths, but we have listed below the most likely explanations.
We note that multiple factors are likely in play, and different factors may be more or less pronounced at various times. The following indicates which factors, in our view, are likely to be having a greater or lesser impact on Australian excess mortality in 2022.
- Post-COVID-19 sequelae or interactions with other causes of death: An earlier COVID-19 illness could be causing later illness and death, and/or COVID-19 could have worsened other diseases which ultimately caused death. Studies have shown that COVID-19 is associated with higher subsequent mortality risk from heart disease and other causes. To some extent, this shows on death certificates in the 1,696 deaths in the first seven months of 2022 where COVID-19 is listed as a contributory cause, and a further 123 deaths that were identified as from Long Covid. However, we understand that medical science has not yet established a causative link that would allow, say, a heart attack several months after a COVID-19 infection to be attributed back to COVID-19. As such, it seems likely that there would be more of these deaths than identified.
- Likely impact in Australia: High
- Delayed deaths from other causes: The reduction in deaths in 2020 and 2021 that resulted from the absence of many respiratory diseases may be reversing. People who otherwise may have died of flu or other respiratory diseases in those years had their systems been stressed may now be succumbing to their underlying illnesses.
- Likely impact in Australia: Moderate, likely to reduce over time
- Delay in emergency care: Pressure on the health, hospital and aged care systems, including ambulance ramping and bed block, could lead to people not getting the care they require, either as they avoid seeking help, or their care is not as timely as it might have been in pre-pandemic times.
- Likely impact in Australia: Low to Moderate
- Delay in routine care: Lack of earlier diagnostic testing for non-COVID-19 causes and delays in elective surgery could lead to later mortality. The delays in diagnostic testing may have arisen from a variety of factors – people avoiding healthcare settings due to fear of catching COVID-19; a reduction in social interactions meaning friends/family may not have noticed ill health in others as early as usual; less availability of routine care with medical resources being diverted to the pandemic effort. While delays in diagnostic testing do not yet appear to be occurring for cancer deaths, it may be a factor in higher deaths from other causes, such as ischaemic heart disease, diabetes, and the large “other” category.
- Likely impact in Australia: Low to Moderate, likely to increase over time
- Pandemic-influenced lifestyle changes: There is evidence from the UK that a higher proportion of people made less healthy lifestyle choices during lockdowns (e.g. drinking more alcohol, exercising less, higher rates of childhood obesity), and that these less healthy practices have continued. It is unclear to what extent similar factors may be affecting mortality in Australia in 2022. Deaths directly caused by drug and/or alcohol abuse are relatively low, compared with those from other causes, but there would be an indirect impact.
- Likely impact in Australia: Low
- Vaccine-related deaths: while there have been deaths in Australia caused by the administration of COVID-19 vaccines, the number of such deaths has been small. Australia has a very good vaccine approval and safety monitoring processes, administered by the Therapeutic Goods Administration. The latest vaccine safety report (to 20 October) shows 136,500 adverse events have been reported from 63.8 million vaccines administered (a rate of 0.2% per vaccine administered). Of those adverse events, 939 were reports of death following vaccination. Of those deaths, 14 were found to have been caused by the administration of the vaccine. 13 deaths were following a first dose of AstraZeneca which is now in limited use in Australia, and 1 death occurred after a booster dose of Moderna and was related to myocarditis.
- Likely impact in Australia: Negligible
- Undiagnosed COVID-19: Some of the excess deaths could actually be from unidentified COVID-19. This effect happened early in the pandemic, but it seems less likely in 2022, as testing is much more available, particularly for those who are seriously ill. Also, for any deaths where COVID-19 may be suspected, post-mortem testing is occurring in Australia.
- Likely impact in Australia: Negligible.
No those don't pass muster as potential causes, mainly because the excess deaths are now biased towards those of working age.
My point wasn’t intended as a personal attack, merely to note that there was a vague source being mentioned for a large statement. I wish you a wonderful Christmas all the same
Fair enough. But what I said holds true, I've not got anything to prove. I've been sitting on this information since January anyway, too sensitive still back then to share it.
I've accepted that society has changed, and that change is permanent not transitory (like inflation :-P )
You didn't read properly. They're rolling out Paxlovid, not the vaccine.
Oh, good point, my apologies. Makes note. Don’t post before coffee.
... I chug the glorious beans 24/7 ... so there is no " before coffee " moment ... I'm always " between coffees " ...
Never heard of hops being referred to as beans before, but I will go with it...
Hop to it , and get some good beers into ya ... .... we have more than 200 crafty brewers around this great nation ... and a world's best equal hop research/ breeding programme : no excuses not to support the industry & chug a few brews : Merry Christmas 🍺😋🎄
Just a reminder to the younger members of the audience: Don't drink alcohol or eat red meat.
CEO Raj Subramaniam: “the FedEx team moved with urgency to make rapid progress on our ongoing transformation while navigating a weaker demand environment.” Rapid "transformation" means layoffs. FedEx won't be unique and it won't be localized. Link
Ominous signs for residential development. The Herald yesterday reported large redundancies at Williams Corporation, and a halt to a major planned retirement village.
That magical combination of soaring construction costs and slumping house prices…
Lack of sales in retirement industry as old people refuse to sell their existing homes. If the industry cut the prices of unit to make them more attractive they reduce the value of the whole portfolio.
Perhaps the retirement villages are fundamentally overbuilt. Been a lot of new ones to sell and there is a turnover from the existing to sell as well.
There are plenty more old people in the pipeline, but families have started to notice how HUNDREDS of thousands of dollars evaporates in but a few years....... I know of multiple families who are now taking care of the oldies themselves as they need that money to help payoff their own debt (oldies agree as well they want to help the kids).
There is a Tsunami of oldies requiring hospital like care 40,000 beds over 10 years short, but the rest homes will not build them as the government will not pay up... they make money off the units.
Going to be some very ugly outcomes
The retirement village industry is a bit of a crock in general. Great for someone who can't or won't want to do any maintenance and upkeep, but financially awful.
A friend of mine summed it up beautifully: ".... a senior citizens asset stripping machine."
Th e Rymans model worked really well for my old fella. Excellent care, great facility and the evaporating cash was acceptable. But that was then.
Many of the other 'guests' also had a bundle of Ryman shares, so some of the cash came back.
The Rymans etc model is going to collapse. It relies on never ending house price growth
Not necessarily, they'll take 30% off the sale price of a unit when you leave, and charge property maintenance fees.
The model may collapse. But the villages will live on - they are just too successful - the inhabitants like them and for good reason.
Why would they need to sell when they can simply pay for in-home care funded by their mortgage-free 10 house portfolio
I’m just trying to think of an analogy of something that by the time it was finished had cost more than the market would pay. Ford Edsel perhaps?
Milldale?
Don't get me wrong its a nice suburb, well built and laid out, cheaper builds then Millwater.
But I just do not see how this carries on with prices 1.1-1.4 mil.
They also want $740k for a 450sm section. What planet are those developers on.
Yip, supply of new build subdivisions has now,( and continues,)out grown demand.
One tree point, Kamo, Morningside, ruakaka have 20 unsold ( retail) development underway totalling over 3000 sections and a plumetting market. The developers have agreements with the big house builders like signature, generation, but these builders have few buyers...
Yet last year they didn't have enough sections...
Builders will be unemployed by February march as the final orders dry up .
Its the same all over the country for new builds...
Standby for many unemployed builders cutting thier greedy margins to get business.. like what happened post the GFC... ( $2500 per SqM down to $1500)
The recession will be a depression.. mark that in you calendar ..
And when Ardern blames covid..... Say bullshit... And reply.. Ardern, Orr's, and Robertsons management created this problem!
Yep playing out pretty much as I called it last year - early signs of slump late ‘22, then the crash hitting in earnest 2023.
No economists have been calling it - they are fiddling around in their ivory towers.
Pretty sure good old TA was going about that along time ago HouseMouse... probably because he's an independent economist - you know.
He did a bit early this year, but didn’t seem to be calling it more than a moderate sort of event. But yes at least he called it.
TA called for house prices to increase 5% this year and has consistently recommended short term fixed rates for the entirety of the year
You are always calling it spot on HouseMouse - absolute legend.
Before you get too hooked on his many predictions and reassurances of accuracy, check over his actual record.
https://www.interest.co.nz/personal-finance/113905/2021-might-have-ende…
yep as said the other day CHC suburbs are fill of million dollar plus new builds on 655sq sitting on the market. even with a 30% deposit thats over a 1k a week on 30 year rate, at todays interest rates. Next years rates looking like to be even higher.
Will be more like May I think
Yes, important to remember that the aged care industry is basically a property speculation venture with a sideline in old people.
Demented old people, locked down and loaded up on drugs. One flew over the cuckoo's nest!
Alarming trade deficit!...
Our minister of trade talks a big story but delivers bugger all ....
Mind you he is only following the rest of Jacinda's mob... All talk.....
Education rooted
Crime out if control
Roads stuffed
Health buggered
Policing rogered
Inflation out of control
Retail screwed.
Air NZ thieves
On the plus side ..
Co governance
Certain elite Maoris given millions for what?
5 waters...
NZ enters 3rd world status
If you went back in time to 1980 people would have been saying the same thing.
So... What have these idiots learned....
Nothing!
No wonder our economy is still stuck in the 80s with two million more people around the country!
Our September quarter CA balance puts us at the very bottom of the OECD. Since the late 90s, no relatively small economy like ours has climbed out of a deep current account hole without being forced into making amends by a market correction.
The hope that low-value spending around the economy by international students and visitors will reduce this widening gap amidst the falling value of our dairy exports. The catch-22 is that we have to import more consumers (workers, students and their dependents) to service those overseas arrivals and nobody is doing the number on whether we land in the black or red from the high influx of migrants.
Cheer up..Santa is on his way 😂
he only comes once a year
Well he is married
You forgot to mention housing.
As well as a shambles of a RMA reform.
You forgot on the plus side Jacinda appearing in Harry and Megans - Leadership BS doco
... a normal person would engage a team of crackerjack lawyers to lay a case against the producers of that doco .... a normal person would ... one suspects that Jacinda will tut tut , and let it slide ...
Never met this fabled "normal" person? Can you describe them for us?
I don't think amny of us who comment are are normal Baywatch. We're all opinionated (normal), but we all generally participate to be challenged and learn (definitely not normal). My experience is that most people don't like, and don't take well to being challenged. But i would say that while there is some satisfaction to being accepted as being right on a point, there is much more in learning something new from others knowledge and experience. and in this despite all the variation of opinion, we are all alike.
Merry Christmas!
Well said Murray.
Pretty easy to end up in a team or a camp, reality is the margins are pretty blurry. Everyone's a conservative and a liberal at varying degrees.
That's why I struggle with conspiracy theorists. The biggest issues are all in plain sight.
Hanlon's Razor - never attribute to malice that which can be adequately explained by incompetence/stupidity.
the wet weather will mean low crop yields in 2023 for Kiwifruit, Avocado, Apples,
Used to be a saying that when the USA sneezes New Zealand catches a cold. Now that would be China.
https://www.zerohedge.com/geopolitical/kyle-bass-chinas-xi-intentionall…
When I predicted in 2019 that the NZ housing market and economy would crash in 2022/2023 it was based on China crashing.
China is not the problem here ...
Piss poor governance has created NZs issues and the way politicians, the RB, and local bodies manage thier portfolios and our money!!!!!
To much waste, minority satisfaction, Maori wonderfulness, world recognition ( Ardern and the Greens), and dumb managers/ spin doctors control
The 2022 " Dead Man Walking " award goes to .. .. ( drum roll please : ta da da da da da ) : Bitcoin !
... smashed , crashed , bashed ... & still standing ...
The trick , guys ... is to stash them in a safe hidey hole where no one sane would ever think of looking ... might I suggest , in My Food Bag ...
Wrong category, sir. Bitcoin would have been the winner of the most prestigious award of them all. The "Woo Hoo! We're still here" award. FTX was an early contender, but alas...
Wrong category, sir. Bitcoin would have been the winner of the most prestigious award of them all. The "Woo Hoo! We're still here" award. FTX was an early contender, but alas...
And just think, BTC potentially has another 75%+ to fall. I, for one, will be filling my sack.
..stash away what GBH? Cash, gold, food..ammo? Diversify and stash the lot? Next qn...but where? Under the bed, in the bush..back of the garden?
And then dementia arrives.
That decline in spending in November is pretty stark. If December is the same that will be a real sign of consumers pulling back.
So, it must be Christmas recipe time.
Take millions of consumers not spending. Add in a major real terms reduction in mortgage borrowing (latest stats out at 3pm today) and falling property prices. Now reduce Govt net spending and channel free Govt cash to people who have lots of it already (RBNZ interest payments to banks now $6.5 million per day).
What have we cooked up for 2023?
- Rising unemployment and major increases in welfare spending - paying people to sit around at home when they could be contributing to their communities
- Reduced investment in productivity and innovation
- Infrastructure at breaking point
- Increased violent crime in cities as the 'have nots' watch in despair as the 'have a lots' tow their jetskis to the beach
- Zero investment in climate adaptation and mitigation - at the same time as the EU and US start to use environmental standards to protect trade
- No change to the broken strategy of destroying our ecosystem to send low value goods abroad in exchange for high value imports
We had better hope that oil prices keep coming down.
Something about omelettes and eggs come to mind.
We've had ample opportunity to 'fix' the economy over the last several decades and chosen not to, in favour of keeping that which we had - and as you suggest that is no longer fit for purpose.
New Zealanders, and maybe most people, don't change if it involves difficult - albeit necessary - choices. Kicking and Screaming can be added to omelette making.
So we now have what we have. Those difficult choices being forced on us via adversity. The sooner we get it out of the way, the better.
What makes you think that adversity provides a catalyst for positive change? There is a real risk that any recession or tough year just makes our problems worse - e.g. leads to the introduction of policies that increase inequality and further erode our quality of life.
That's why I can't get the glee at this recession, like it'll be a turning point for something better.
It is very, very rare for the system to just willingly improve the lot of those without, and even less so in times of economic downturn.
And the people who were branded conspiracy theorists such as the prophet, are now, and will be soon revered as almighty and all-knowing. Where nobody believed, they will all learn they were duped and when the house of cards comes crashing down, then the real mayhem will ensue unless they can all forgive and concede, come together and unite for the better of all, instead of the better of each to his/her own.
https://www.nzherald.co.nz/nz/john-gascoigne-how-new-zealand-can-gain-r…
For example, if our GDP were to grow to $350b by 2050 but our population were to increase to around seven million (as some advocate) our per capita income would be far lower than at present.
It cannot be overstated that in economic development population growth is the negative factor.
New Zealand will only achieve rich-nation status by becoming an export powerhouse.
Or having a population of 150 people and robots can do everything.
New Zealand will only achieve rich-nation status by becoming an export powerhouse
Before people start to jump in and quote "tyranny of distance", I'd like to point out that high-end service exports are the bedrock of small but wealthy economies.
That being said, successive governments have achieved inverse outcomes by not fixing, even aggravating our broken education, tax, migration and housing policies.
We've shifted our productive operations overseas, imported consumers in droves instead of high-skilled workers, lost high-end exporters to greener pastures (our homegrown gaming and aerospace companies are likely to become the newest victims), and the bulk of our largest businesses are heavily focused on domestic markets rather than being outward-looking frontier firms. This trend has only picked up pace under the last three governments.
While these are truisms, you also need to consider other realities.
If Rocketlabs are dealing with NASA, makes sense to be based near NASA, and the larger capital market for funding.
Same thing happens with all of them, they outgrow New Zealand.
So how do we reverse this? Do we have to give them tax exemption? Does the state help fund them at our expense?
I genuinely want to hear how we increase our export economy beyond our natural advantages.
Why is Weta still here or are they slowly emigrating also?
How do we reverse this? How about...
- Reduce Corporate Tax to 5%
- Strengthen worker protections - e.g. rachet up minimum wages, reduce tax on earnings
- Introduce Land Value Tax
- Move quickly to 99%+ renewables (offshore wind, solar, hydro, batteries)
- Invest in infrastructure that a successful service sector needs (public transport, broadband, vibrant urban centres etc)
- Basically make NZ the place where (a) Corporate HQs and Service Companies can operate with zero carbon, (b) skilled, creative people want to come and work, and (c) anyone working fulltime can afford to live well without direct Govt subsidy
So spending and tax cuts. How are we funding this then, QE?
- Introduce Land Value Tax
I saw that there but I also don't feel that'd cut it.
Nope - although direct financing in our productive capacity (as we did for our state house / hydro builds) would need to be part of the picture initially.
A modest Land Value Tax and savings from people being paid more (= increased tax take, reduced accommodation supplement and in-work benefits, greater share of gains for workers) would keep things broadly neutral - or at least keep deficits low enough to reduce inflationary pressures if demand exceeds supply.
Just to meet a 5% corporate rate would be a crown revenue shortfall of some $17 billion a year. On a per property basis, that'd be some 10 grand a year land tax, on average.
You also didn't say what sort of tax break paye earners would get, but that goes on top as well. If it were halved for instance, that per property land tax becomes some 25 grand a year.
How do non income earning land holders pay for the land tax? How is it defined - if it's based on a valuation, what happens to crown revenue if property values fall?
There's a lot of moving parts there - but ultimately it depends on how much a govt is prepared to tax accumulated wealth, and by what taxation channel. My strong view is that corporate taxes are counterproductive - better to go after the excess profits at the point they become someone's wealth.
Raise corporate tax. No minimum wage, let supply and demand rule. No Land Value tax. Can renewables and drill-explore for fossil fuels. Invest in productive industry, not the service industry, where government funds their pet projects.
Corporate HQ's and service companies can never operate without spewing carbon. Life is carbon, we need carbon.
NZ fell for the corona virus hoax, surely you are not going to fall for the global warming will kill us all hoax too! You have got everything backwards.
If you believe that we as a country are exporting to our fullest potential and have hit the ceiling on our natural advantages, you have a lot to learn before we discuss any further.
We cannot blame our economic shortcomings on geographical limitations when over 40% of our recent high school grads are functionally illiterate. While we're at it, let's also blame the slide in global competitiveness ranking down from #21 in 2019 to #31 in 2022 on distance from key markets as well.
Short term policy thinking, short term societal (non-political) thinking, High house prices and stubborn inequality
If you believe that we as a country are exporting to our fullest potential and have hit the ceiling on our natural advantages, you have a lot to learn before we discuss any further.
There's always room for improvement and development, I'm involved in a couple of export industries so have seen benefits brought about by significant capital investment and having an industry reach a size whereby production can happen on an industrial scale. But after significant growth, there is a limit to how much we can produce or how cheap it can be produced for.
This has occured across most of our existing industries. So I am interested to see where you feel the room for growth is, because most people making this argument just mention vague ideals.
We do have some questions to ask around our education system, and overall compliance industry as inhibitors.
I would argue our over-centralised political system does a huge disservice to our economic competitiveness. The Cabinet wields a disproportionate amount of power in deciding the fates of councils, crown entities and industries, thanks in part to the fact the tightly held centralised public funding structure we have in NZ.
We have 70+ territorial authorities around the country that have very few revenue sources to fund basic infrastructure, let alone contribute more towards economic development within their jurisdiction. That's the worst of both worlds.
Surely the likes of Waitaki District Council could do a lot more for local business growth in a month than MBIE could do in 3 years if it got a piece of the funding that goes straight to Wellington bureaucrats for strategic initiatives.
This doesn't really address what I said or illustrate where we can increase or develop our export dollars.
You think local councils are the missing link in developing our export economy? That's quite a bit of faith you have in them.
I was more after tangible export areas we can be competitive in that are lucrative that are currently missed opportunities for some reason. In the billions of sales a year realm.
We could stop losing the high-value export earners who want to be here but are getting entangled in red tape. Link
Film subsidies are turning out to be very expensive tourism ad campaigns for NZ taxpayers. There are a range of sectors that can generate better economic returns with those subsidies. Early-stage tech companies could put more money back into growth initiatives with a GST subsidy.
But NZ has a relatively low amount of red tape compared to many of its contemporaries.
The first firm in your link doesn't appear to be developing or manufacturing those drones in NZ, they're importing and selling. Is that high export value for NZ.
And in your own article:
Wisk has shifted its air taxi testing from New Zealand to its home base of California, but stresses that was not because of any barriers.
And
"But it's not like the problems go away moving to another country. The other regulators are speaking to us, so clearly they wouldn't be speaking to us if the problem didn't exist over there as well."
What are these range of other sectors you speak of, what would they use the subsidies for and what sort of return would NZ get?
It all sounds like vague tinkering around the edges.
That's pretty odd. Our GDP was $363.3 bln in the year to September 2022! Granny Herald needs better fact-checkers of contributor content.
Reading the article I think that should read 500 bil
... was the Harold referring to our GDP in $US , not $NZ ?
It was a CTU economist. They're often in la-la land
And how much of that was government financed? (Debt fueled growth)
I saw a harold on the seat next to mine at the cafe yesterday. It reminded me of the dirty little, rag tag UK tabloid I used to read in London 50 years ago.
Queenstown
"Nobody goes there anymore. It's too crowded." - Yogi Berra
https://www.nzherald.co.nz/nz/its-just-nuts-workers-leaving-queenstown-…
Kiwis.. The herd mentality.. The more news in media of Something, they all start doing that no matter if it makes sense or not. Be it travel, real estate, drinking Beer, wine etc.
We need more individuals with personalities of their own and not more cows and sheep personalities.
This will diversify the country and make us a successful nation one day.
The housing collapse has started in Canada. Like a house of cards the whole sector will be brought to its knees in 2023. Uber drivers, who last year signed deals and paid deposits to buy two million dollar homes, can no longer qualify nor afford the mortgage required. The domino effect is no money for the builder, no money for the trades and no money for the bank that propped by the builder's development. It will all come crashing down unless the builder can negotiate something with the bank and rent out the houses.
And all the while interest rates will continue to rise as inflation isn't dropping anywhere fast enough for any interest rate relief in 2023.
Not too dissimilar to NZ. After all Canada and NZ share two very similar leaders, in Trudeau and Ardern, and two very similar affordability/housing bubbles.
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