Here's our summary of key economic events over the holiday that affect New Zealand, with another quick news wrap-up so you can get back to 'time-off'.
This is our final holiday briefing and we return with normal service on Monday.
First up, American producer prices unexpectedly fell in December from November but only by a tiny amount. That means that their producer prices were up only 1.0% in the year, up from a rise of +0.8% in November on that basis. A year ago US PPI was rising at a +6% rate. Today's PPI data was less than expected.
The January edition of the USDA's WASDE report forecasts lower American beef exports in 2024 and higher imports from Australia and New Zealand. The American milk production forecast is lowered too. (See page 4.)
Indian industrial production momentum fell away in November. It was up +2.4% from a year ago, marking the lowest reading since March last year, following a downwardly revised +11.6% growth in October. Analysts had expected November to expand by 4%. Output decelerated sharply across all key sectors. Meanwhile consumer inflation ticked up slightly in December, up to 5.7%, above the November 5.4% but less than the expected 5.9% rate.
China's new yuan lending for December came in well short of what was expected. Beijing is clearly having trouble getting funding out of its large policy banks. The December +¥1.17 tln was marginally higher than in November but well short of the expected +¥1.4 tln. In their context ¥1.4 tln isn't large by historic standards. And the +10.4% rise from a year ago is very low by Chinese standards - in fact a record low expansion on that annualised basis. This may be a factor.
China's exports rose from US$292 bln in November to US$304 bln in December, a +4.0% rise and a bit more than expected. They were up +2.3% from the same month a year ago. But the good December result - aided by a depreciated currency - masks that for all of 2023 exports dropped -4.6% from the record 2022 level.
Helping the December result was that producer prices fell -2.7% in China, quite a different pressure than the virtual no change in December 2022.
And as expected, consumer inflation was negative - that is, deflation - with prices -0.3% lower in December than the same month a year ago. This was slightly "less worse" than expected, and is the third month in a row of year-on-year deflation. But that is their longest deflation streak in 14 years. Overall food prices rose +0.6% in the month to be -2.0% lower than a year ago. But beef prices are -6.0% below year ago levels, lamb -5.7% down, and milk down a lesser -0.9%.
Today is election day in Taiwan, a free and fair contest. It is annoying Beijing who are making bellicose threats. The results will be available early tomorrow, probably, although media forecasts will come before the official counts. It is expected to be a close-run thing. It is a modified MMP style election with voters having two votes, for a local electorate and one for the overall party. But the party votes only account for 34 seats in the 113 member parliament, the balance being constituencies.
The RBNZ reported that the total value of our housing stock as at the end of September rose by +$27.6 bln from June to $1.59 tln. That was the first quarter-on-quarter rise since December 2021, although a year ago this value was $1.63 tln, so it is still some way down on that basis and still -$172 bln lower than the peak in December 2021. Over that time we have been building new houses, aggressively in some places (Auckland), so that data shows the per-dwelling value down more than -13% from that peak, nationally, a retreat of -$118,000 per dwelling.
We should note the rise and rise of the price of uranium. There is a global shortage as new nuclear electricity plants are being developed worldwide, in fact +170 of them (60 in construction, +110 planned).
The UST 10yr yield starts today at 3.96% and down -7 bps from this time yesterday. A week ago it was at 4.03%. The key 2-10 yield curve is much less inverted, now by -20 bps. But their 1-5 curve inversion is little-changed, now by -84 bps. And their 3 mth-10yr curve inversion is more inverted, now by -143 bps. The Australian 10 year bond yield is now at 4.07% and down -5 bps. The China 10 year bond rate is now at 2.52% and little-changed but still near its lowest since 2002. The NZ Government 10 year bond rate is -5 bps lower at 4.72%.
Wall Street has started its Friday session with the S&P500 little-changed from yesterday but that is holding a +1.8% gain for the week. Overnight, European markets were all back up +1% except London which only managed a +0.6% gain. Yesterday Tokyo ended its Friday session up another impressive +1.5% rise for an even more impressive +6.5% weekly jump. But Hong Kong fell -0.3% yesterday locking in a -2.0% weekly loss, and Shanghai fell -0.2% yesterday for a -1.2% weekly retreat. Singapore ended its Friday session down -0.3% for a -0.5% weekly dip. The ASX200 ended yesterday down a minor -0.1% for a weekly finish up +0.1%. But the NZX50 booked a better +0.5% gain yesterday for a weekly rise of +0.9%.
The Fear & Greed index remains little-changed in the "greed" range which is also where it was a week ago.
The price of gold will start today up +US$26/oz at just on US$2043/oz. That is up a net +US$2 from a week ago.
Oil prices are -50 USc lower to be now just over US$72.50/bbl in the US. The international Brent price is unchanged at just under US$78/bbl. Earlier reprisal strikes in Yemen had these markets shifting prices higher, but that impetus has reversed now. A week ago these prices were US$73.50 and US$78.50/bbl respectively.
The Kiwi dollar starts today at 62.4 USc and more than +¼c higher than yesterday. A week ago it was at exactly this same level. Against the Aussie we are little-changed at 93.4 AUc. Against the euro we are +¼c firmer at 57 euro cents. That all means our TWI-5 starts today just on 70.9, up +20 bps from yesterday and marginally firmer from a week ago.
The bitcoin price starts today lower, now at US$43,284 and down -5.9% from this time yesterday. A week ago it was at US$43,436 so actually little-changed since then. The first flush after the US SEC ETF approval hasn't delivered the sector's hoped-for demand rush. Volatility over the past 24 hours however has been very high again at +/-4.4%.
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96 Comments
I looked at a couple of other insurers quotes which were around double what I currently pay so I'm probably getting a good discount for the other policies I have with Tower. I have made a few adjustments to my policy (agreed value dropped $10k, no accessories, no rental car cover - I have another vehicle) & got it down to "only" a 20% increase. Excess was already at max $1000
I have 3rd party only on 2 cars, its a cheap as chips. If you have an old car wouldn't worry about full cover, if you write it off just go and buy another cheap car. What you are paying in insurance these days you have paid for another car anyway in 5 to 10 years.
Seems Tyler Durdan, or Даниел Иванджийски is going to be working hard on getting the Russian Agent Orange back in the White House over the next few months.
So you don't think he has a right wing bias? Yes, we all know the deficit figures, but that's not the point. People should be aware of biases of journalists. In the same way, if anyone quotes or links the Guardian, I know that there will be a woke, feminist, left wing bias.
Mr Zero Hedge, Даниел Durdan, or whatever his name is, obviously fancies working towards a Trump presidency for his pal Vlad.
Another Trump presidency would turn a barely hanging on human civilisation into an unrecoverable sh!tshow. That is a simple fact!
Trump increased the national debt by almost $7.8 trillion during his 4 years in the White House. So far the US national debt has grown by over $6.24 trillion since Biden took office in 2021, largely driven by COVID-19 relief measures.
There's more at stake here than the "US deficit"! Having a fascist, nepotistic, barely coherant authoritarian running the biggest economy on the planet, with his cabinet of right wing rapture enthusiasts, will greenlight Vlad the little KGB imperialist for his mission to impoverish a larger swath of Europe/Central Asia.
Interesting vid about how the crisis industry is influencing generations:
https://youtu.be/WnA7pJ18Kpk?si=PgpdziD3drP85Fl7
The TLDW is:
- our attentions are our most valuable asset, and the media industry co-opts it using the easiest method; pitching fear and grief
- more people than ever are bombarded with how bad things are (which is partially true) on a constant basis. This is causing many to either YOLO it up, give up, or embark on high risk, low probability financial investments
- the good news is given the high proportion of people taking themselves out of the running, there's actually more opportunity than ever for people to make wise choices and give things a serious crack
Enjoy 2024. Back to the wilderness for me.
Oil prices are -50 USc lower to be now just over US$72.50/bbl in the US. The international Brent price is unchanged at just under US$78/bbl. Earlier reprisal strikes in Yemen had these markets shiting prices higher, but that impetus has reversed now.
Iran confirms ‘retaliatory’ oil tanker seizure
The “seizure took place on a court order,” the Navy reported, as the “Suez Rajan tanker had earlier stolen an Iranian oil cargo and handed it over to the US.”
I am taking the opportunity to highlight the West's (primarily the UK & US) piracy preferences using the convenient cover of oil prices.
Russia ready to retaliate if West seizes its assets — MFA
Furthermore, my unearned investment cash balances are at record levels since my retirement from earned income employment in 1998.
What Hitler's Germany couldn't achieve, namely defeating, subjugating the United Kingdom, and deceiving and keeping people small, has been accomplished by globalists Link
Sale of UK assets to world’s largest money manager means huge payday for bankers
Global Infrastructure Partners, whose portfolio includes Gatwick, sold to BlackRock in $12.5bn deal
It's on the record that Hitler wanted to help the UK retain its imperial possessions, even offering to assist with German troops should they be needed. He was an admirer of the British people and certainly didn't want to make them small. It was the US that wanted the UK to divest itself of its ill gotten territory and be reduced to a small people until they realized that they needed a strong UK and Germany to help with countering the Soviet Union.
Zachary,
"It's on the record that Hitler wanted to help the UK retain its imperial possessions" And of course Hitler was well known for keeping all his promises. If you really believe that, I suggest you buy some proper history books and educate yourself on WW2.
I suggest you start with martin Gilbert's monumental Second World War-it runs to over 800 pages.
By the way, as you seem somewhat credulous, I have a wonderful investment opportunity for you.
Just saying that it is on the record Germany wanted an alliance before the UK declared war. It's not very acceptable by today's standards but the Germans of the time did have a very high opinion of Anglo-Saxons as they are Germanic tribes. Perhaps they were hoping to get some tips from the professionals on how to govern a colonized Eastern Europe.
Winston Churchill's , "The Second World War," is an absolutely rivetting read if one wants a good take on what happened 1939-45. A reprint of his correspondence with Roosevelt, Stalin, various other world and British political figures, and his commanders, with a commentary in between them. Only 6 volumes, each 800 pages. Required reading for anyone who wants to have some sort of opinion on WW2.
Please don't write such irrelevant rubbish. As I said, it is a reprint of correspondence. All 1939 stuff was written in 1939. 1940 etc the same. The situation of the war is felt as one reads. One can't wait to see what's happening next. And one finds out the lead ups to events. Great final chapter without giving it away.
Please don't write such irrelevant rubbish. As I said, it is a reprint of correspondence. All 1939 stuff was written in 1939. 1940 etc the same. The situation of the war is felt as one reads. One can't wait to see what's happening next. And one finds out the lead ups to events. Great final chapter without giving it away.
Should be highlighting the point that 60 nuclear power stations are under construction while 110 planned. The only way the world will get to carbon neutral. Yet little old NZ shies away from nuclear. Everybody wants solar and wind turbines of course so long as it's in somebody's else back yard yet nuclear is the only source apart from coal, hydro and geo to guarantee power wether there is sun or wind or pitch dark. The greens don't want hydro. And before someone says oh NZ is on fault lines etc. Japan has just commissioned the biggest nuclear plant to date.
We're getting there. Population increase is slowing right down all over the world. In the last 40 years the population boomed from 2.5b to 8b. Projections predict a peak population of 10 - 10.5b in about 40 - 60 years before decline. I'm sure Covid pushed that figure down and sooner.
NZ is a ticking time bomb, birth rates have dropped right off in the 2010s and the only thing keeping our population afloat is mass immigration. But we don't have the work for another 120,000 immigrants even in 2024, let alone every year for the next forever, we don't have the work for our current population. How many more people can we cram into the same rentals?
Population wise at 8 billion, we're already over the edge and staring at collapse. Will we get to 10/11 billion? I suspect not. We blew through the 1.5C safety limit in 2023 and temperature records are expected to be broken in each of the next few months. These increases exponentially pressurise civilisation with each passing .1degC. We are close to a tipping point!
"A system dynamics model that best fits recent population numbers suggests that the global biocapacity may already have been reduced to one-half of its historical value and global carrying capacity may be at its 1965 level and falling. Simulations suggest that population may soon peak or may have already peaked."
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.02472…
Or, we could take responsabilty for our reproduction rates and let the air out of the population balloon, in a humane and equitable fashion? I fantasize it's not too late for that, but rationally I know it is. We keep voting for ignorant sales people promising policies that ultimately guanrantee your options.
Possibly I'm wrong and a techno utopia of AI surveillance and control, precision fermentation and insect protein, genetically engineered, recycled sewerage smoothies, high tech props mimicking what natural systems originally did for free on Earth, as we zap around the galaxy in metal tubes, looking for other hapless planets to drain the life out of? The wheels will fall off long before this fantastical fairytale comes to fruition.
Personally, there's little I can do, although both Indian and Chinese birth rates are falling rapidly, with China well below replacement. All I can really do is call out population growthist, pro natalist nonsense when I see it and hopefully this ship will turn before the iceburg.
Be honest with yourself redcows, it's both. A flippant answer to your assertion would be, If you halve consumption and double population you are in the same place. The missing piece of your puizzle is consumption cannot actually double with the current depleting resource base and overflowing waste sinks. Consumption will go down, that's a given. How this effects the individual depends on the number of people the shrinking cake is sliced between.
The human doubling would mean double the piles of human excrement and probably linear or even exponential disease risk for a start. The physical displacement of the natural world and the psychological impact of population density itself leads to dysfunction. Humans evolved on the wide open spaces of Eastern Africa, not in a shoebox on the 40th floor.
People still lived, loved and enjoyed life when population and consumption were much smaller and now we have the knowledge for healthier lives too. If humans ignore our overshoot, we lose everything!
Japan has more people go through its biggest train station each day than live in Auckland.
According to JR, approx 3.6 million pass through the station each day.
During Covid, I was trying to explain to a NZ journo why network effects were far greater in other countries simply because of their transport systems. He was struggling to rationalize why this was relevant while trying to defend the NZ govt's 'superior' Covid response.
Australian dollar is not backed by gold. They just happen to have a small amount in reserve.
The RBA's gold is not in their possession. It's in custody of the Bank of England. The RBA was very defensive on OIA requests related to the most recent audit. The RBA cannot account for the gold whenever it likes. It takes 6 months to audit.
https://www.smh.com.au/politics/federal/a-golden-audit-rba-to-check-on-…
https://www.facebook.com/watch/?v=285029786395066
houses are like bonds there is a coupon... so they have a an income flow, but yields have got to low prices too high, still a great asset class as long as you understand they act as a bond if an investment. they will continue to fall over next 24 months .... just watch
Most countries don't own any gold...it means nothing. The USA owns about 8,000 tons but all it would buy these days is probably a few warships.
The USA use some of their gold as a tourist attraction in downtown NY, it's booked out months in advance. Any notion that gold is insurance or 'money' is astoundingly naive.
tradingeconomics is behind
One of the fuel brokers. Updated twice a day.
https://numerco.com/NSet/aCNSet.html?reload=true
This guy on X has all the updates
BTW my Uranium stocks are on the up.
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