Here are the key things you need to know before you leave work today (or if you already work from home, before you shutdown your laptop).
MORTGAGE/LOAN RATE CHANGES
No changes to report today.
TERM DEPOSIT/SAVINGS RATE CHANGES
None here either.
HEARTLAND'S STRONG REVERSE MORTGAGE & DEPOSIT GROWTH
Heartland Group Holdings (HGH), parent of Heartland Bank, posted an increase in June-year net profit after tax of just under 1% to $95.9 million. The group said its share of the Australian reverse mortgage market rose to 38.4% from 33.1% year-on-year. Heartland Bank's deposits grew $534 million, or 15%, with the bank achieving the highest growth rate in retail deposits of all NZ main and domestic banks in the first and second quarters of its financial year. Gross finance receivables increased 10% to $6.8 billion. Return on equity fell 68 basis points to 11.9%, and net interest margin dropped 8 basis points to 3.97%. Impairment expense ratio rose 11 basis points to 0.36%. Heartland expects 2024 June-year profit to be within a guidance range of $116 million to $122 million.
$1 BLN SURPLUS
To investors and the stock exchange, Auckland Council is touting a "strong recovery from Covid-19 despite challenges". It reported that in the 12 months to June, its revenue grew +18% to almost $6.7 bln - and it had a surplus of more than +$1 bln for the year. Income from rates rose +7.4% (up +$158 mln). It now has total assets worth $73 bln, up +3.6%. Included in this result (as "revenue") was a $178 mln donation of artworks to the Auckland Art Gallery from Julian Robertson, the famed American (and Kiwiphile) investor who died recently.
EXPOSING HAZARDS
EQC has launched a website that makes it easier to find information on natural hazard risks in all communities. This includes being able to see settled EQCover claims on residential properties and land in one place for the first time.
PROFITS CONFIRMED, SHARES MARKED DOWN
New Zealand's largest listed company, F&P Healthcare (FPH) confirmed its May profit guidance today, saying it has moved away from its "supply-at-all-costs mentality, and we are once again focused on operational efficiency". They expect revenue to exceed $1.7 bln in the upcoming year and have started the first half +14% ahead of the prior year levels. They expect first half earnings to be a "net profit after tax within the range of approximately $95 million to $105 million". Their share price fell -1.3% today.
NO GDT AUCTION TOMORROW, BUT WATCH THE PULSE
Please note there is no dairy auction tomorrow morning. Normally these happen every two weeks, but this time there is a scheduled (and expected) three week break. But there is a Pulse event tomorrow. From the July 25 Pulse event when it was at US$3000/tonne, WMP prices have fallen at the rate of -$140 per week, down to US$2450/tonne. So anything over US$2300/tonne might be considered a 'win' in the circumstances. The last time the WMP price was that low was in August 2016.
SWAPS ON HOLD
Wholesale swap rates were probably little-changed again today, but the real reaction will come at the close. Our chart will record the final positions. The 90 day bank bill rate is up +1 bps at 5.65%. The Australian 10 year bond yield is down -4 bps at 4.12%. The China 10 year bond rate is unchanged at 2.61%. The NZ Government 10 year bond rate is down -1 bp to 5.06%, and still above the earlier RBNZ fixing of 5.01%, also up +1 bps. The UST 10 year yield is down -4 bps from yesterday, now at 4.20%.
EQUITIES RALLY
The NZX50 is unchanged near today's cloe. The ASX200 uis up +0.4% in afternoon trade. Tokyo has opened up +0.2%. Hong Kong is aup +1.8% in its opening trades. Shanghai is up +1.0%, both expecting stimulus from Beijing. They also took cues from Wall Street's solid gain earlier with the S&P500 up +0.6% in Monday trade.
GOLD IN MINOR MOVE UP
In early Asian trade, gold is at US$1922/oz and up +US$6 for the day. Earlier it closed at US$1920/oz in New York, and earlier still at US$1918/oz in London.
NZD LITTLE-CHANGED
The Kiwi dollar has hardly moved against the greenback, still at 59.2 USc. Against the Aussie we have slipped -20 bps to 91.9 AUc and our lowest in a month. Against the euro we are marginally softer at 54.6 euro cents. The TWI-5 is unchanged at 68.4.
BITCOIN STUCK AT $26,000
The bitcoin price is still hanging tough, now at just at $26,085, barely changed (+0.3%) in the past 24 hours.
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45 Comments
Sir Bob Jones has offered those who don't believe there's going to be a change of Govt to put their money where their mouths are - at 3 to 1 odds, as many millions as they can come up with https://nopunchespulled.com/2023/08/29/free-money-offer/#more-5436
There’s a famous photo of Jones exiting a car in what appears to be a velvet tux, and giving the fingers to a group protesting the 1981 Spingbok tour.
Silly old grumpy boomer he is https://thespinoff.co.nz/atea/14-02-2020/bob-jones-is-not-just-a-racist…
He offends snowflakes, but so what, they get offended over anything. Bob says what he wants, when he wants, that is his right, and many many people agree with him whether they say so or not. Billy T (if he were still alive) falls into the same category. Poor old Billy T would have probably been canceled for taking the Mikey out of himself. We are lucky to have Bob around. He is right about the election. If someone wants to bet against him, Bob will make yet more money. I doubt anyone will take him up on the offer.
Worst Government and Prime Minster to this day can only go to one man - December 15, 1975,
Robert Muldoon’s decision to cancel the fledgling New Zealand Superannuation Scheme on that day was probably the worst financial decision ever made.
Why? Because had it continued, New Zealand would now be one of the richest countries in the world.
The Superannuation Act, passed by the Labour Government in 1974, established the New Zealand Superannuation Scheme with the following characteristics;
- It was compulsory for all employees between 17 and retirement age.
- Money could only be taken out early if a contributor left the country permanently.
- Each contributor had their own individual and portable account.
- Contributions were 8 per cent of gross income, 4 per cent by employees and 4 per cent by employers.
- The scheme was not taxable except for stamp and cheque duties.
Not only Super. Kirk’s government introduced ACC, formed the Rural bank to bolster primary production, established a shipping line to keep the overseas owned lines, in line so to speak, had the backbone to cancel a Springbok tour, legislated the Property Speculation tax to rein in a rampant property boom, set up Rolleston as a satellite town (now booming,) and sent a frigate plus Minister Coleman to confront the French nuclear testing and Martyn Finlay to litigate that in the Hague. Kirk handled Muldoon easily but once he passed none of Labour could withstand Muldoon’s remorseless, relentless personal attack politics. The irony being that when Muldoon did attain power he changed very little. To the point that Bob Jones, who had ridiculed and hounded Bill Rowling, formed the NZ Party and helped Labour oust Muldoon. What a bloody merry (actually unhappy) go round all that was.History has been unkind to big Norman Kirk but in hindsight his government was innovative and progressive and needs to be recognised as such.
I suggest you check the variety of ethnicity in spouses he's had
Also, a little known charity he funds
https://tindall.org.nz/applications-open-for-sir-robert-jones-refugee-d…
Not black and white.
More spot-on than the TAB with the rugby world cup odds. ABs favourites at $3.50? Come on!
I put some $$$ on the Boks when they were paying $6.50. And I have some on the French.
All Blacks pack too small and too old. A weak midfield and a flakey (albeit often brilliant) first five.
Having said that I would never totally right off the All Blacks but I would be surprised if they win the cup. I’d have them as fourth favourites.
Rather nobly, the ABs try and play at peak every game, and win every test.
The Boks certainly don’t, and haven’t in the modern era. For them it’s the bigger picture that counts. No one will remember the rugby championship in 10 years, but plenty will remember a world cup.
Yeah. And it’s not just the TAB in NZ. Although I have seen one or two international agencies having ABs and France as joint favourites.
I feel that there might be a surprise or three. Scotland are pretty good and are a chance against Ireland and SA. Georgia a possible upset against Aus?
Perhaps the presence of a good team in Scotland in SA and Ireland’s group is screwing the odds a bit? Notwithstanding that, I struggle to see how, objectively speaking, the ABs are favourites ahead of France.
Looking at recent prices of silver coins - it's been pretty volatile. I dug out my NZ Mint "Bullion Daily Quick Fix" emails. A 1oz Silver Fern is now over NZD$50:
Aug 2023 = $50
May 2023 = $48
Feb 2023 = $44
Oct 2022 = $42
July 2022 = $38
Apr 2022 = $45
Dec 2021 = $41
Sept 2021 = $38
June 2021 = $46
Oct 2020 = $42
June 2020 = $32
Housing payment for new homes now as high as 51% of median household income in the U.S. - highest level since the 1980s.
Owning a home has become so expensive, that many people are cancelling their insurance - national average home insurance for $250,000 in coverage has increased 20% this year.
https://www.wsj.com/personal-finance/americans-are-bailing-on-their-hom…
A good piece from John Minto on Labour’s pathetic outputs in terms of public housing construction, despite their rhetoric and spending huge money on Kainga Ora, a truly bloated and useless agency:
https://www.thepress.co.nz/a/nz-news/350052370/behind-spin-housing-cris…
Which is why the state shouldn’t be making bread, cars, houses, etc. instead they should be making it easier for the private sector to do it. 10 years ago all the private rentals near us had been subdivided to the limits insisted by the boffins in council, and all the state houses were still sitting on full sections and completely unmaintained. Had that land been sold to private developers decades ago and the council allowed development decades ago, I doubt we’d have a housing issue.
I don’t remember that. They have built some decent stuff, but they were part of the problem in the first place, so it’s too little too late. I am very big on free market, always have been. I think the government have a role in pricing externalities (eg a sugar tax so the free market pays for destroying teeth and health, a proper carbon tax so people have to pay to pollute, etc), but not much else.
I possibly would if they were proper libertarian. But I don’t like that the right wing are very backwards thinking, old religious fuddy duddies from rich backgrounds. And I do like the government investing in areas where only they can: hospitals, schools, transport, etc, so tax cuts aren’t really a big thing for me.
If we had an economically conservative progressive party I’d vote for them. Labour were better under Ardern when they were centre left and had some good ideas (but unfortunately couldn’t deliver), now they seem to be socialist left and have no idea. The Clark Cullen government was a good one, economically conservative and paid off lots of debt. Key and English weren’t terrible but made the massive rookie mistake of not investing during the downturn.
Which is why the state shouldn’t be making bread, cars, houses, etc. instead they should be making it easier for the private sector to do it. 10 years ago all the private rentals near us had been subdivided to the limits insisted by the boffins in council, and all the state houses were still sitting on full sections and completely unmaintained. Had that land been sold to private developers decades ago and the council allowed development decades ago, I doubt we’d have a housing issue.
S'pore and Japan would never have housed their populations without govt strategy and involvement. Remember, S'pore had '3rd world' living standards at independence and urban Japan was largely flattened.
Exactly. And leasehold tenure has been a key part of the Singapore model.
A massive, well run government house building programme in NZ could work wonders*. But no party has the appetite for it, nor to be honest is there the capability. If that is the case, we might as well give up on the idea and just try and let the private market do a pretty average job.
*It should not be forgotten that Kiwibuild was conceived by David Shearer, and in his conception of it, it was the government building shitloads of houses off the back of big investment in prefabrication plants. Phil ‘Stoner’ Twyford and Ardern then bastardised it so it effectively just became a private development underwriting scheme. Fail.
Yes, a good review of the symptoms.
Minto lays blame on govt, but if we didn't have the banking system exploding money supply whenever Ponzis sneezed (with "I'm too big to fail" govt backing transferring risk to tax payers) we wouldn't need workarounds like governments funding house building on anything like this scale. Monetary Policy enables speculators, and we pay the price in many ways.
I kind of hope we end up with homeless people camping around the walls and halls of parliament, but I doubt the pollies would connect the dots and would just start carrying water pistols.
Minto lays blame on govt, but if we didn't have the banking system exploding money supply whenever Ponzis sneezed (with "I'm too big to fail" govt backing transferring risk to tax payers) we wouldn't need workarounds like governments funding house building on anything like this scale. Monetary Policy enables speculators, and we pay the price in many ways.
Comment of the month. Bravo.
Toyota to shut down all plants in Japan Tuesday due to large-scale disruption
The timing of the restoration of the plant is currently unknown
So many expats have been leaving China and now the govt is concerned. So the govt has extended the preferential tax policy for expats till 2027.
But, the damage left from last 3 yrs policy (Covid camps, pro-Putin, Taiwan issue ,etc) has caused many companies to rethink their China strategy going forward.
The boardrooms of multinationals have realized that:
1) they still need to be in the China market and need to be there
2) they don’t want to commit to massive direct investment
3) they prefer to leave the business to local partners or operators
4) no need to recruit expats (not because of money)
Reminds of an uncle, a retired farmer in the city. Neighbour had a tortured willow blocking both his view and sun. Wouldn’t remove it even not at any cost to him. . So my uncle left his garden hose on, on the other side of the fence, and the willow grew like topsy. Then he turned off the water, the willow had outgrown itself, and turned up its toes. Perhaps that is a parable of sorts of how the West has participated with China?
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