A review of things you need to know before you sign off on Friday; Rabobank raises TD rates to highest of any bank, job ads in unexpected rise, swaps stable, NZD rises, & more

Don't see it myself, the banks are really dragging the chain on TD's and the more people that pour in, and they are pouring in the less likely they will feel the need to attract funds. Its going to take another OCR rise from here and a poke with a sharp stick

Which relates to higher mortgage rates..

Did someone say 8% guaranteed? 

Most of those Rabo TDs are lower than ASB that has a higher credit rating. Rabo may not gain much traction.

NZ and our woke footpaths! What's next, cycle lanes?

Still makes some sense for a nation that's the world's largest oil producer and the second largest automobile producer to be designing its infrastructure around private vehicles.

The billions that we could have saved in fuel and car imports each year over decades if more effort went into making Auckland a more public transport-friendly city. 

NZ First.

Real household incomes in Japan have dropped so much not just because of prices, more so recently due to falling NOMINAL incomes. Since December, nominal incomes are down more than 7%. And people think Japan is red-hot because of its CPI. https://buff.ly/3sHq4ab  Link

Inflation adjusted wage growth did stagnate though. To me the real story of the Japanese bubble is about unbridled real estate speculation.

So, what are countries going to do when they can’t afford to pay the higher prices for energy? Well, Janet Yellen, who was the Federal Reserve head and [now] the Secretary of the Treasury says, ‘Well, what we’re going to do is use the International Monetary Fund to preserve America’s unipolar hegemony.’ I think she used almost those words. We have to keep American control of the world and we’re going to do it through the IMF. And that means in practice using the IMF to create special drawing rights, which will be sort of like free money, the bulk of which will go to the United States to support its military spending abroad for all of this huge military escalation. And it will enable the IMF to go to countries and say, ‘We will help you pay your debts and not be foreclosed on and get energy, but it’s conditional.’ On usual conditions: you have to lower your wages; you have to pass anti-labor legislation; you have to agree to begin selling off your public domain and privatize.

The energy and food crisis caused by the NATO war against Russia is going to be used as a lever not only to push privatization, largely under control of US investors and banks and financiers, but it’s also going to lock countries into the US orbit all the more, both the Global South and especially Europe.

One casualty is obviously going to be Europe and the euro. The euro has been plunging in value day after day after day, as people realize that it’s lost its export markets in Russia and much of Asia, and now at home, too, because exports require energy to be made. Its costs of imports are going up, especially energy. It’s agreed to use, I think, now $3 billion to build new port facilities to buy US natural gas—liquified natural gas at three to seven times the price that it’s paying now, which will make it almost impossible for German firms to produce fertilizer to grow crops in Germany. The euro’s plunging.

The largest plunge of all has been the Japanese yen, because Japan imports all of its energy and most of its food and is keeping its interest rates very low in order to support the financial sector. And so, the Japanese economy is being sacrificed and squeezed. And I think this is…you can’t say, ‘Gee, this is an accident.’ This is part of the plan, because now the United States can say, ‘Of course we don’t want your yen to go down so much that your consumers have to pay more. We will, of course, give you SDRs—special drawing rights—and we will give you American aid. But we do want you to rewrite your constitution so that you can have atomic weapons on your soil so that we can fight against China to the last Japanese. Just like we’re doing in Ukraine, let us do it for you.’

And, of course, the Japanese love that. The government loves that idea. They love sacrificing the population, which is what they’ve been doing ever since the Plaza Accord and the Louvre Accord of the 1980s that basically wrecked the Japanese industrial economy from this huge upswing to just a mass shrinkage.

So, those are the economic effects of the war. And in the newspaper, you think the war is all about Ukrainians and NATO fighting Russians, and it’s really a war by the United States to use the NATO-Russia conflict as a means of locking in control over its allies and the whole Western world, and in Janet Yellen’s words, re-establishing American unipolar power. Link Hudson

Heartland is in the business of lending in areas the other banks traditionally avoid. Bascially inherited from Perpetual Trust.  As well as Reverse mortgages. As they move toward even more digital banking I expect to see some real growth especially from Australia. The lending in the rural arena has cooled. I watch how well Wrighties are doing with sales and then track it back. Mind you, Westpac as well as Rabo lend to farmers. 

The hesitancy of farms exchanging hands it is what has been occurring under Labour and the Greens. Who needs the risk of buying a property and then discoverying the Maori have placed a special status over it?

One of the reasons I am voting Act. When we lose the laws we inherited from the Romans and the Magna Carta, ie our freehold then putting hard dollars becomes very risky.

Incidentally Maori are the biggest and largest Farm owners in New Zealand.  Did you all note that wee fact?

Arranged a 1 year term deposit with HL yesterday. 6.25%, compounding monthly.

Yes ASBs new TD rates are going to be a headache for the stressed 2nd tier lenders. As mentioned above, Rabos new rates (bar the 1 yr) are less than ASB. Lets see what the eternal laggard BNZ raises to next week.

It's like Covid never happened. Covid was a wakeup call, and it is likely there could be something far worse that comes along.

Not sure I would trust her. The Ark Innovation Fund looks a bit sad, just huff and puff in my opinion. I like the idea of decentralised finance etc but not sure it will ever be allowed to happen.

Past time to eliminate overhead costs of rent extraction from national GDP accounting.

Whereas formal economic models explicitly state their assumptions (whether realistic or not), national accounting frameworks feature various implicit boundaries, which are not shown along with the data but are rather buried in technical notes on ‘methodology’. For example, the interest- based financial services mentioned above were originally considered mere transfers and thus outside the production boundary before 1968 (Christophers 2011). The 1968 System of National Accounts (1968 SNA) moved the production boundary by representing these services as inputs to an imaginary sector (thus making the assumption that they were ‘implicitly’ productive), whereas the 1993 SNA moved it further by considering such services to be the final consumption of households (and thus explicitly productive). The 2008 SNA went even further by stipulating that even the lending of banks’ own funds was a productive activity (dropping the pretense of ‘intermediation’ between savers and borrowers originally used to portray banking as a productive activity). In each of these cases the assumption of the level of productiveness of interest-based financial services was not explicit in the data, but rather implicit in the location of the boundary. Similarly, R&D expenditures by firms, governments and non-profit organizations were previously assumed to be intermediate inputs (or costs) of these entities, and thus deducted from GDP, but have been reclassified by SNA 2008 as investments in fixed assets, and are thus now counted in GDP. This adjustment added around $560 billion to US GDP in 2013 (when the country adopted SNA 2008) - more than Sweden’s entire output that year - and conveniently reinforced “America’s status as the world’s largest economy and [opened] up a bit more breathing space over fast-closing China” (EIU 2013). Different boundaries in the national accounts are thus based on different assumptions and lead to different results, but less explicitly than formal economic models. This contrast with explicit models is thus the second reason why MMT had not yet affected national accounting. Most economists do not even learn the details of national accounting in their professional training, and the measurement (or rather construction) of macroeconomic aggregates such as GDP is outsourced to official statisticians. It is simply not considered part of the conversation, neither in mainstream nor in heterodox circles. Link/GDP overhead

Russia to develop ties with North Korea regardless of what other countries think — Kremlin