Here's our summary of key economic events over the weekend that affect New Zealand with news China is on a knife-edge in its battle to keep Omicron out.
This year, Chinese New Year, the Year of the Tiger, starts officially on February 1, and then there is are about two weeks of public celebrations until Lantern Festival. And the related travel season is about to start now and will run until the end of February. This year it will be stunted with restrictions around their hosting of the Winter Olympics and the threat of an Omicron outbreak. It is a nervous time in China as a growing set of travel bans are being imposed. For traders with China, consumption should rise, but logistics problems will be intense as well.
Average new home prices in China's 70 major cities fell in December from November as concerns about property default and tighter policies aimed at driving speculators out of the property market grow. On a year-on-year basis they rose by just +2.6% in December, after a 3.0% gain a month earlier and down from +5% in mid 2021. This was the weakest annual rise in new home prices in five years.
But there was better news for them on the trade front. China's trade balance swelled in December as export growth stayed elevated and rising +4.8% from November while import growth slowed, falling -2.8% from the prior month. Both were up about +20% year-on-year and took them to an overall 2021 surplus of +US$676 bln or about 2.8% of total world trade. The politically sensitive surplus with the US came it at +US$39 bln in December which in its historical context isn't that remarkable. It was +US$30 bln in November and +US$30 bln in December 2020. But clearly, American tariffs have had zero impact. (The US had an overall trade deficit with all-comers in 2021 of -US$850 bln or -3.6% of GDP; less than half was with China.) China ran a trade deficit of -US$4.5 bln in December with Australia; with New Zealand that deficit was -US$0.4 bln in the month. Going forward, all this depends on how they react to the spreading pandemic.
In the US it is earnings season on Wall Street with some major fourth-quarter earnings coming from companies such as Bank of America, Goldman Sachs, Morgan Stanley, P&G and Netflix.
Elsewhere, central banks in Japan, China, Indonesia, Malaysia, Turkey and Norway will be reviewing policy rates this week. On Friday, the South Korean central bank made a rare back-to-back rate hike, adding another +25 bps to the policy rate and taking it to 1.25%. Inflation fears are driving these moves.
Back in the US, retail sales in December came in much weaker than expected after a flat November. And it was the largest month-on-month fall in ten months, but on a year-on-year basis it is up almost +17%.
Compounding that, US industrial production unexpectedly slipped in December from the prior month following a good rise in November. On a year-on-year basis it is +3.8% higher. Compared with pre-pandemic December 2019, it is +0.5% higher.
Completing the downbeat tone of the weekend US data, the UofM sentiment survey sank to a decade low as attitudes to current life are battered by the surging Omicron pandemic and a rising fear of inflation's impact on them. Three-quarters of consumers in early January ranked inflation, compared with unemployment, as the more serious problem facing the country.
In American bond markets, funds are now flowing out in the expectation of Fed rate hikes in 2022. Holding bonds now risks capital losses. The high-profile boss of JPMorgan Chase, Jamie Dimon, said the weekend he expects six or seven Fed interest rate hikes in this cycle, based on the resilience of the US economy and American household balance sheets. But getting there will be turbulent for financial markets, he warned.
In Australia, home loans jumped +6.3% in November from October, mostly driven mostly by an improvement in owner occupier lending of +7.6%. But this probably won't be repeated for a set of reason, firstly the hit Omicron is taking, secondly the RBA's wind-back of its money printing, and thirdly rising mortgage interest rates ahead of an RBA change at some point.
In fact, labour shortages from Omicron stand-downs and scarcity of merchandise for sale are together likely to put plenty of pressure on Australian inflation levels and the RBA may well have to consider interest rate rises much earlier than they have previously signaled. Markets are starting to price that scenario in.
In NSW, there were 20,978 new community cases reported yesterday, a fall and a hope that they are topping out, now with 342,838 active locally-acquired cases (and undoubtedly an undercount), and 20 more deaths. Hospitals face serious staff shortages, and they have been told the number of COVID-positive people needing inpatient care could exceed 4500 within the month. They are now up to 2,650 having doubled in a week. More than half of all NSW ICU patients are unvaccinated. 17,791 pandemic cases in Victoria were reported yesterday, also a reduction even if small. There are now 237,559 active cases in that state - and there were 13 deaths. Queensland is reporting 17,445 new cases and 3 new deaths. In South Australia, new cases have held at 3,450 yesterday with 2 more deaths. The ACT has 1316 new cases and 2 deaths and Tasmania 825 new cases. Overall in Australia, 86,060 new cases were reported yesterday.
The UST 10yr yield opens today at 1.79% and up another +2 bps and a one year high. The UST 2-10 rate curve starts today slightly steeper at +82 bps. Their 1-5 curve is also slightly steeper at +106 bps, while their 3m-10 year curve is also steeper at +175 bps. The Australian Govt ten year benchmark rate is down -1 bp at 1.87%. The China Govt ten year bond is unchanged at 2.81%. The New Zealand Govt ten year is also unchanged at 2.47%.
The price of gold starts today at US$1818/oz and little-changed.
And oil prices start today firmer again, up +50 USc to just over US$83.50/bbl in the US, while the international Brent price is now just over US$86/bbl.
The Kiwi dollar will open today at 68 USc and dropping -¾c from Friday's brief spike. Against the Australian dollar we are firmish at 94.5 AUc. Against the euro we are holding at 59.7 euro cents. That means our TWI-5 starts the today at 72.3 and the same as where we opened a week ago.
The bitcoin price has moved up by +1.2% to US$43,411. Volatility over the past 24 hours has been modest at +/- 1.4%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
Daily exchange rates
Select chart tabs
157 Comments
This is probably China's most challenging year in decades.
An entire machine that's been building empty cities and buildings for quite some time is going to come to a halt.
Omicron will surely rip through the population, interrupting production, retail, and logistics.
And public debt is 300% of GDP.
Yes. If the population gets grumpier despite (the distraction of the Olympics) the CCP may need to give them an exciting scrap over Taiwan to be busy with.
But isn't public debt more like 70% of GDP?:
https://tradingeconomics.com/china/government-debt-to-gdp
Looks like the overall debt is more like the figure you gave us:
https://www.scmp.com/economy/china-economy/article/3135883/china-debt-h…
Is it only China or rest of the developed world including NZ.
In China Real Estate Sector effected and their economy is on brink of .......can one imagine what will happen to NZ, if it's real estate sector even pauses ( not fall but pauses) .......being only economy as of now in economy.....what percentage of GDP and household money is tied in housing sector !!!!!
Passing the parcel has to continue, come what may and RBNZ and Government has no choice but to support and promote for their own survival.
Spot on Roy1. If we're paying for overseas good with a dollar that wants to keep playing stupid games but won't invest it in anything that produces for external consumption (e.g. housing) then we've got a real crisis on our hands. Makes you wonder just how much the NZD has insulated the working class of NZ from the sort of living cost increases that we're seeing in other countries, on top of what our local distributors and retailers like to charge us as a local product premium.
For the critics of the Government over how we have handled COVID, they should do some studies of Aussie.
A little over a week ago I read a letter from a lady who has a sister in Aussie. She says that things are breaking down over there with so many staff off with COVID, shops are closed for cleaning and supply chains breaking down. Her sister says NZ is very lucky not to face that.
Check out your life insurance pays out for Covid induced death and your income protection policy for long term disability following covid jabs 1/2/3/.......... insurers will of course be scrupulousy honest and act with utmost integrity just like they did with quake claims, remind me when were all quake claims finally settled??????????
Omicrons flame is burning out in UK
https://www.dailymail.co.uk/news/article-10407919/Covid-cases-drop-HALF…
Fair comment, but the news here is full of the impact of Omicron on Aussie. And spoke to a chap on Sunday who caught COVID last year in AK . He said it was really very nasty, but he got through it.
In NZ it has impacted AK the most as that is our primary gateway, and despite the impacts most of the rest of the country has been relatively normal. But the trick with COVID is DON'T TRAVEL!
I do tend to agree with most though, that it will get out here and will spread so we need to be prepared for it.
By the end of Feb we should have 80% of eligibles boosted and probably an equal number of kids fully vaxxed. That would be the time to talk about deliberately opening, although I suspect Omicron will actually arrive before then. Every day our vaccine numbers creep up => less stress on our hospital system. But eventually we'll be too close to winter and it might be worth getting it here early - but not yet. Our public health people know this.
My son in his early 20s works in Sydney. He went to the opera at the Opera House on Saturday night, La Boheme, then to the pub with mates. On our last call he mentioned a queue going around the corner, I thought it would be for covid testing, but he mentioned it was for the Louis Vuitton store. Last week he went to the Ashes. They still play futsal. He says there are a bit less people on the street in the morning. The only change he notes is that the mid week pub quiz is cancelled, though the pub is still open. Half of his mates caught omicron, they thought they were a bit hung over, but realised it was omicron when the Monday morning RATs at work came back positive.
I spoke to a few AU-based clients last week (to recommence the new working year) and your comment aligns with theirs - all pretty much BAU with a bit of pressure on staffing due to isolation requirements. My friends I video called on the weekend who are based in Sydney said the same thing.
Several of my family members in the UK have had Omicron too. None had anything more significant than a pesky cold (including my 95 year old grandma).
That isn't to say that Omicron can't be bad, and it clearly comes with some issues e.g. staff shortages and supply chain stress, and it is unfortunate and sad that some people will get seriously ill and even die, but in countries where it has been allowed to spread relatively unchecked like the UK the whole system hasn't fallen over.
it is unfortunate and sad that some people will get seriously ill and even die
Many people do not understand this. It's a pandemic. People will die. Even with vaccines and promising drugs like Paxlovid, some people will get seriously ill and some of those will die (including those who have been vaccinated). It's tragic and scary, but something we must accept. I am worried about some of family, if they will make it through, but we need to be strong and move forward together. We can't hide forever.
Im in QLD right now. Seems fine to me. Sure some people are off isolating but the virus will become endemic and there is no way around that. Those who wish to have the vaccine have had it and now we move on to return to some sense of normalcy. Delaying tactics won't achieve anything other than the potential it takes off in winter and then NZ will really be in trouble.
When will humans admit that ultimately they can’t stop the transmission of respiratory viruses?
However NZ faces new lockdowns and even tighter border restrictions to keep NZ quarantined as the advisors admit that the traffic light system was only designed to get vaccination rates up not to prevent transmission.
https://www.theguardian.com/world/2022/jan/10/new-zealand-not-prepared-…
“The traffic light system won’t help us very much because it was never designed to dampen down transmission, it was only designed to nudge people towards vaccination,” Baker said.
Ideally we'd have the wave in summer when people are outdoors and they have all that Vitamin D in them which would slow the rate of transmission and give immune systems the best chance.
Heading into cooler weather makes this a much higher risk proposition because you'll also have influenza spreading again piling pressure on limited health service resources.
Inflation and bond market are the key at the moment if you have invested in US bonds your are loosing around 5% of your wealth each year.the FED are going to stop purchasing them which will send yields up and interest rates are the only way to keep USD from sinking.the whole system is on a knife edge. NZD and interest rates are like twig in a large river which will be pushed along depending on what happens in US.
It's Northland that's most like to see a lockdown IMHO. Low vaccination plus pathetic healthcare availability = big potential for trouble. I doubt we'll lock Auckland down (famous last words :-) ). Once Omicron gets here it will be all about flattening the curve to keep our healthcare system out of trouble.
First measure, the border will remain closed indefinitely. That may delay things. Then there will be regional lockdowns. The government appears incapable of admitting elimination is no longer possible. Since day one they have been fighting a delaying action and can only imagine NZ will be safe to open up when covid vanishes elsewhere? The PM gave pretty good indication (after stepping down from her higher international podium profile about Tonga) of that, things are “RIFE” overseas & my my, New Zealanders don’t want that do they now.
IMO the only hope for the border reopening is one of two scenarios:
1) Omicron gets into the communidy and spreads like crazy (i.e. hundreds or even thousands of cases a day territory) at which point does it really matter if we import a few more cases every day? MIQ might make sense while we are trying to keep Omicron out ... but once it's here that argument goes out the window.
2) International pressure gets to the government, particularly the PM - who very clearly places a great deal of weight on her international perception/reputation. If other countries start to "get over it" and reopen (which seems to be on the cards for the likes of the UK) you might see NZ start to be perceived as a 'hermit kingdom' in the international press. At the same time, domestic political pressure could expand once people start seeing their relatives, friends and colleagues overseas jetting off on holidays over the Northern Hemisphere summer. The Zero Covid True Believers will never get over it as it seems to be an all-consuming belief system to them; but I suspect many of those in favour of border restrictions now will change their tune once they see the rest of the world start to inch back towards normality.
Of course some ultra-heinous variant could be lurking around the corner in which case all bets are off.
I agree, the nature of Omicron is such that as soon as borders reopen to any other country MIQ won't be relevant. They could delay it again to announce another round of shots but, short of vaccinating the family pets, I can't think of any other group they could administer vaccines to at this point.
Waiting longer also had the additional risk that the vaccine capability will be further diminished and the effect of that extended program is then completely negated. That would be particularly unpalatable for New Zealand given it's very long road to full vaccination that's already paved with broken Zero Covid promises.
For fun's sake I am going to put forward the following third scenario ... very much tongue in cheek but somehow I suspect this is what will happen.
In this scenario, MIQ works well enough to keep Omicron out, apart from the odd leak like this current case. Just an unending cycle of "Omicron detected in X border worker", followed by a scramble to test everyone who has come into contact with them, nobody ever actually catching it in the community, and toilet paper stocks being continually raided like Genghis Khan never died.
By late Feb/March everyone who wants a booster will have had one. Uptake will top out around 70-80% of the hitherto fully-vaccinated. The government will then announce that you won't be able to extend your vaccine passport for domestic use without a booster (thus getting a high booster uptake) by which time everyone who rushed out to get the first booster is now sitting there with rapidly waning efficacy, meaning that come May/June it will be time to go back for your second booster and/or Omicron-specific dose.
The government will make noise about reopening the border, reuniting the team of five million + one million overseas etc, but will bottle it at every turn and keep delaying (this will keep the perpetually-worried very happy as there will always be more boosters to take, more preparation to be done, more opportunities to tell everyone to worriedly "wait two more weeks and see the real impact of Omicron in Australia/UK/insert-other-country-getting-on-with-life-here, it's just around the corner you had best believe it"). The media will continue to make the rest of the world out to be a total basket case, as little old NZ goes it alone like David versus Goliath - if making Judeo-Christian references hasn't been declared hate speech by this point in time.
The border will then conveniently be reopened towards the middle of 2023, around the time that everyone starts thinking about the next election. The media will be on hand to communicate this triumphant moment, and all the perpetually-worried (apart from the remaining Zero Covid True Believers, led by now Sir Michael Baker) will sudden forget what they were ever worried about because the talking heads on the television have now told them everything is ok.
Those who were - up until this point - too scared to leave the house without a mask welded to their face and a tanker truck full of hand sanitizer in tow will be the first to rush to the business class cabin of the first no-MIQ-on-return, Air NZ business class flight to Los Angeles.
Added bonus: By this time the government won't have to worry about the votes of all those pesky Kiwis who have been overseas for more than three years and are therefore ineligible to vote. The team of five million thanks you for your sacrifice, good day. Everyone's a winner, lovely jubbly.
(ok there's a hint of "grumpy to be back at work" sarcasm in there, but I could see a similar scenario playing out)
Surely at this point a lockdown would be widely ignored. Anyone paying attention can see that omicron is even less of a threat and barely even relevant to anyone but the oldest and sickest, especially if vaccinated. 2 shots for more lockdowns, chur, doesn't quite have the same ring to it.
NZ will face another lockdown - maybe terminology used will be different as Jacinda had mentioned that in future we will never go back to lockdown, so we will have one but only with different name.
Reason for this is that omicron virus will come to NZ and knowing how rapidly it spreads are bound to have another lockdown, unless our mummy PM keeps the border shut for next few yearwhereas rest of world continues to accept and live with virus.
Can delay but not avoid.
Since we are two years into panademic, how many extra ICU bed and hospital capacity been increased knowing that virus is not going to end soon. What are they doing to bring back doctors and nurses instead of throwing dole to silence the critique and on upper side keep on pumping the housing ponzi so that both lower and and upper end keep quite, while middle class is screwed but who cares.
Worst outcome of democracy is VOTE BANK POLITICIS.
Borders are shut to avoid the exposure of fragile health system to rest of the world as for them NZ is a developed country with robust health system.
People keep saying this like you can make significant improvements to a health system in 24 months.
Takes years to train medical staff (unless you import them, and they're in short supply globally)
Takes years to plan and build facilities (again, construction resources are also in short supply)
This isn't China where you can just throw labour at grand gestures like building a hospital in 13 minutes.
Exactly, that's my point. We all know we can't build a hospital in a year, but you can advance planning and also have done more in the way of upgrades.
I think we could have done much better at attracting and retaining extra medical staff, both within NZ and from elsewhere, too.
Good points Waymad. My experience is that in Health management and medical staff pay is too high and out of step with the rest of the country, and this swallows too much of the health budget. It also means nurses, who are just treated like menial staff, are under paid for the work they do by comparison.
The union for Doctors cites international rates to justify Doctor pay levels, but NZ doesn't use international rates as a basis for most jobs (else we wouldn't likely have a low wage economy). The whole thing is screwed up big time!
That is correct. The two nurses in my family have had a gutsful - as have their colleagues.
Whilst many public servants and others sat at home on full pay, they have been heading off, working in plastic bags all day, no scheduled tea or lunch breaks. And they watch so called project managers (with no med or formal qualifications) waltzing around the testing and swabbing centres and whose main role is organising the filming of tick tock posts (and are being paid handsomely more than a nurse).
If only the public knew - but that would require an active media!
In my (non-Doctor but similarly trained and skilled) specialty, the same job in Australia pays 30-50% more depending on the state. The Government is generously offering us no pay rise and a 1-2% lump payment next year, in the face of 5% inflation. This has obviously been a real morale booster after a tough couple of years and increasing workloads.
A good question. Lifestyle, family and friends would be the most common answers, but the way we are currently being treated is certainly stacking the other side of the equation.
We're a small workforce and vulnerable to staffing collapses which I've seen a couple of times already in my career, hopefully the government will realise that inflation no longer looks like it did when they put forward the pay restraint policies.
Thank-yous and hand clapping worked for a while. Our med people need more than feel good token gestures.
Their goodwill has been exploited and will not work in future. Most are exhausted and burnt out.
Prepare for covid infested NZ with a diminishing med work force.
its a wonder there are many nurses left in nz , family reasons l suppose.
they have been treated so poorly & kept on working . RESPECT .
Big signing on bonus overseas + 30% more $$$
it will be interesting few months coming guys..
l am sure our gov funded media will pic it up....
I have a family full of medical professionals, including doctors, dentists, nurses, and pharmacists. It's what our family does (except me).
The problem is not the pay for doctors. Doctor pay rates are way too low (as are nurses) and their hours are too high (crap rosters, little to no overtime pay). The problem is the pay rates for administrators who are taking up far too much of the pie. Too many people pushing papers and too few people actually treating patients. This is not unique to New Zealand, however, and a similar problem exists in the USA too (probably many others).
Many of our family were trained and worked in Australia. Family ties are the only thing keeping some in New Zealand, but housing and overall cost of living pressures have meant that some have not returned. When borders open properly, there will be a rush of healthcare professionals, among others, to Australia.
Same issue in the UK's NHS. Traditionally elderly doctors ran the admin until someone decided they would be better treating patients and not pushing paper and that young graduate administrators would be more dynamic and modern.
Strangely not the approach of successful rugby clubs who generally find ex-players make the best managers.
The problem lies in the psychology: the person giving the orders must be paid more than those receiving them. This doesn't apply to film stars who earn more than the directors, writers and CEOs of the film companies. It didn't apply at a small computer manufacturer I visited 40 years ago - there were two programmers with one writing the operating system and the other writing their compilers and both earning more than double their smartly dressed team leader.
No but they could have postponed the $ millions spent already, as exposed by Dr Reti in parliament, on the centralisation plan removing DHBs & pushed those funds into upgrades & extensions, even recommissioning some facilities. To go at that in the midst of a pandemic, create so much uncertainty at the coalface, just about as crazy as a wage freeze on nurses and associates.
Govt released a statement that the ‘wedding’ was a private matter and further comment would not be expected by govt or media’. Well I’m hope you enjoyed your time off and summer wedding Jacinda but it’s now time to hold you to account in a public forum with no hiding behind your 3 press secretaries.
Well, they could start by not making things worse:
1. Don't remove targets.
2. Don't expect primary healthcare providers to do more, then actually pay them less, and announce you are spending more on health.
3. Don't lock out medical staff from the country, including the specialist consultants that head up departments.
4. Don't lockdown business-as-usual procedures and services to create an unnecessary backlog.
5. Don't use your union cronies to screw over workers.
The bright line test was not a new tax. The bright line is a marker to ease enforce for an existing tax by using time to sell as a proxy for a person's intention better by deeming intention at purchase (even if it actually wasn't). However, some might argue that Labour's 10-year bright line transformed the existing tax into a capital gains tax on housing by making the bright line so long. To be honest, I don't find either argument compelling.
Plutocracy
Yes you're right! And you could have mentioned many more like Tuberculosis, Chicken Pox, and Tetanus, not to mention our annual flu injections.
The Government's got an unenviable job tantamount to herding cats, many of whom appear in this column. Then there's all the high profile attention seekers from all walks of life: there's Brian Tamaki, a Hitler wannabe; sir Ian Taylor, a favorite of granny Herald, and basically a graphic artist who thinks he's an expert in epidemiology; and yesterday's politicians like Stephen Joyce and Richard Prebble who think they know best.
This is certainly the age of grandstanding attention-seekers. Everyone wants to be famous.
And who else is there even half capable of running the country? Absolutely nobody. Nobody in this column is going to step up to the plate and say "I'll walk the talk, I'll form a political party to do things properly."
Back in the US, retail sales in December came in much weaker than expected after a flat November. And it was the largest month-on-month fall in ten months, but on a year-on-year basis it is up almost +17%.
Again, seasonally-adjusted basis, total retail sales for December 2021 were down a pretty stark 1.9% from November. Still high, still huge, but the trend is more toward fading Uncle Sam than not. Even though gasoline prices were down last month, too, and that contributed something to the monthly overall decline, retail sales excluding those registered by gasoline stations dropped even more; off 2.03% m/m.
And since CPIs have obviously accelerated with all that pre-Christmas folly, maybe jolly, putting retail sales in real terms (using the CPI) shows that the likely volume of goods has been on a steady decline (apples-to-apples) going back to April; December no different, if anything accelerating the trend.
Dating back to Peak Helicopter, real retail sales are down a very sharp 5.1%, making it an annual rate of -7.5% applied to the final two-thirds of last year. Link
In American bond markets, funds are now flowing out in the expectation of Fed rate hikes in 2022. Holding bonds now risks capital losses
Eurodollar Futures Curve Update (spoiler: still inverted)
Perhaps most important of all, the curve’s changes you see above during the first two weeks of January fully corroborate everything I’ve written recently with respect to the rest of the “bond market”, Treasury curve, in particular, about how to interpret this BOND ROUT!!!!
It’s all about the Fed rather than improving growth even inflation prospects.
The market here, like the front end of the Treasury curve, is being pushed up because Jay Powell’s hawks have surmounted any remaining omicron doubts. It’s clear sailing into rate hikes; at least the first few of them. Thus, the eurodollar curve has in its entirety moved up (shown above).
If this was improving economic potential or inflation, then the flatness would have gone away at the same time the curve pushed upward nominally. Instead, just like the Treasury curve, those rate hikes are colliding with the same Taper Rejection skepticism and therefore, this week, the kink in the eurodollar curve went back fully inverted again!
Inflation, lots of inflation. The Fed policy change is going to take a lot of bank reserves out of circulation so there it going to be a credit crunch in the market. It's almost as if the articles of people complaining about getting a mortgage are somehow related to this.
MortgageB... Not sure why u are asking that question ?
In regards to Jett Snyder, I kinda enjoy reading his stuff, thou find his writing difficult to understand.. ie. what is he saying and what is he predicting...??
My view is that he fundamentally believes that the interest rate mkts. are a source of "solid information"..... and are a reliable signal/guide as to future inflation expectations.
I disagree with this premise/belief/paradigm.
My own view is that we are in a period of "financial repression" , where the interest rate mkts are influenced by Govts/Central Banks.
SO... in regards to inflation and inflation expectations one has to watch for policy responses from Govt/Central Banks.
I'd agree with Ray Dalio, that our current policy directions are analogous to the 1940s... where we had inflationary spikes together with ultra low interest rates. https://www.linkedin.com/pulse/mechanics-war-economy-ray-dalio/
At some point the interest rate mkts (Bonds etc) will go thru some kind of "paradigm shift" and interest rates might start to reflect future " inflationary expectations"....
SO.... There is a big difference between my "Worldview" and Jeff Snyders'..
I'm more aligned with the views of Ray Dalio... who I think is a kinda genius. ( Over the 10 to 12 yrs I've followed his stuff, he has been very good at anticipating Govt/Central Bank policy responses......which can be very helpful in making investment decisions, and which in our current environment, pretty much covers the "Macro view"... )
I'd suggest that this "macro approach" thru the lens of Govt/central bank policy very much applies to NZ.
just my view.... of course. ( I'm not shitting on Jeff Snyder... I thinks he is a very smart guy. )
Hans - our official expiry was last month, however AirNz are extending them. Check this link, when using your credit online put in the new relevant date as the card expiry date (assuming you have been allocated a virtual credit card requiring a card no and expiry date).
Air New Zealand Refunds & Flight Credit | Request or Redeem Credit
I've just come back from a holiday down in Wanaka and Queenstown, and it is an interesting juxtaposition (to say the least) to see people diligently masking-up and scanning in to protect their health ... all while walking around burnt to a crisp.
I know I'd rather take my chances with Covid any day over skin cancer!
I have just had 15th or 16th large Carcinoma removed from my head this time with a skin graft. All over my body in past... Nobody told me years ago that skin block was useless and that wearing long sleeves and long trousers and a big bloody hat was beneficial to stopping Cancers from impacting you, later in life.
If nothing else is mandated, common sense should prevail, Never ever burn your body with Sun in any spot. If you get a Spot now, get it checked out. They grow like Wildfire in your Old Age....and they can kill you if left too long.
New Zealand is one of the worst places in World for Skin Cancers....I know....please take note. Never ever trust just Sun Block. Cover Up e specially if you go Pink, Not Brown.
Had a Holiday place at the Mount....was there for Years.....now I hide under large trees at Home. Trees which stragely enough do not line most beaches in NZ....Shades are not stupid....People are....I know I was one of em. Even more so, when the Sun is out all bloody Day, this year.... Happy New Year...stay safe...Keep your body even safer.
It ain't just Covid, and Houses, we should Shout about.....from the Roof Tops. Cancer Kills more people.
+100. I got burned as a kid, played a lot of cricket. In my 30s now, thankfully learned my lesson and have spent the better part of the last ten years living inside and avoiding the sun like the plague. I figure I just have to survive long enough for medical science to recover from the Covid effect and then we'll see some focus back on cancer treatments and vaccinations. I can't undo the damage I did as a kid yet, but I can try to live long enough for doctors to figure how to fix it. That might be ten years, it might be twenty years. It's no good to me if I've gone past the point of no return before then.
Doesn't look like NZ will get rain until late Jan and how much of that actually gets to Northland remains to be seen, or whether it will be another front torn apart by blocking highs.
Can see some relief for the South and West of the South Island but hard to think that much of it will make it to the Waikato or Northland/Auckland. Could be a bit of a problem brewing if we don't get some circuit-breaking ex-TCs that put up a better fight than Cody did.
The "huge" rains and wind forecast for Hawkes Bay yesterday and today have so far amounted to a light drizzle for a few minutes early this morning that didn't even register on my rain gauge. The wind is starting to pick up a bit now though so maybe we'll get a few showers later today. Six weeks since our last significant downpour.
We haven't had a decent downpour since.... NFI when. A few years ago we used to get asbolutely screaming thunderstorms and downpours in Auckland in the run up to Xmas, which would see us through the dry bits in Feb/Mar. Now we don't even seem to get that and end up with resident blocking highs either side the upper NI. Seems like the humidity that used to party with the urban heat upwell against the Waitaks/Hunuas has just gone and been replaced with a dry heat. If it's that bad in an urban setting than I shudder to think how intense it must be getting in the Hawkes Bay and Taupo areas. They were scorching at the best of times already.
We've had the usual 30+ temperatures, but this year we've also got humidity - sitting at 52% right now when normally we'd be sub-30. Funnily enough we keep saying we must be getting Auckland's humidity.
Last year we barely browned off, this year I'm glad we started a just-in-case hay stockpile over Winter.
House Price correction in 2022 in USA. Even in 2008 when it was crash in USA, we did had a setback in NZ but was not as severe as in USA.
Will this time be same, if it happens in USA.
Interesting video by a youtuber as search engine at time does predicts, what if is true as nothing is one way street in economy.
THERE'S NO MORE BUYERS: Google Predicting Spring 2022 HOUSING CRASH?
Yes, TK, some parallels between post-GFC and now although then the RBNZ had been hammering mortgage payers at 8% OCR and mortgages up to 11% before cutting radically in 2010?, then a flat house price period 2010 to 2015.
Whereas now we have had very high price increases and recent interest rate hikes.
No chance, Biden has just given Powell his job back with the understanding that Powell has to rescue Bidens tanking approval ratings by halting inflation, and halting it fast. Don't be surprised by interest hikes of 0.5 from now on.
Yes, seems to clear to me that was the deal, and the rates trajectory we are on.
However, I think it will change back again this year as consumer and producer prices soon get rejected, so growth stalls, unemployment comes back and asset prices start to crumble. I think Powell will then tell Biden he's achieved the inflation mission, and they can afford to splash a bit more cheap money and regain some market confidence and make the economy look a bit better. An irresistible "small cake and eat a bit of it" line of bullshit that kicks an even bigger can down the road to eventual currency collapse.
China is on a knife-edge in its battle to keep Omicron out.
Why would China want to keep Omicron out ??? Omicron is the best thing since the mania about Covid started and the way out of the multiple restrictions. (that is if media and governments will be willing to let go of the Covid stories) The sooner we all catch Omicron and easily get over it, the better.
How ironic - we are no longer the free world. Ripped from us the guise of a pandemic - with no bodies in the street, no famous people dying of it and no life insurers going broke. History shows us elites never let a plague go to waste - even if it isn't a very good one.
There is a lot of inaccurate and uninformed comments about China being made here in. For example one person quotes that the total public debt / GDP is 300%. That's simply rubbish. It's currently sitting at around 63%...Setting aside their current real estate problems..China is moving ahead economically in spite of the US efforts to squash them. Between Tesla in Shanghai and BYD ..they managed to produce nearly 1 million EVs. Their exports to the US actually rose...while all that the US imposed tariffs achieved was a US inflation rate of 7%. When China hits a roadblock...they just work harder at a work around. We have a lot to learn.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.