Here's our summary of key economic events overnight that affect New Zealand, with news of sharp pullbacks in global factory activity.
There were two April factory PMI's out for the US manufacturing sector and both fell sharply. The local ISM one however didn't fall as much as anticipated (-41) whereas the internationally benchmarked Markit one did fall more than expected (-36). In both however, it was the collapse of new orders that registered most strikingly. But neither has reached the depths of the GFC yet.
Even at these depressed levels it is clear demand is even lower and more cuts are just a matter of time.
But this data hasn't weighed on overnight equity markets as heavily as the earnings disappointments, especially from the tech sector which was assumed to be a resilient pillar of the equities market. Apple, Amazon and Google for example flashed warning signals. More than 1000 companies reported March earnings this week and overall they disappointed. The big trend is the withdrawal of earnings guidance even as company PR continued to try to sound optimistic. Exxon reported a -US$600 mln loss, its first in decades.
Not helping markets is the US Administration threatening a new round of tariffs on China as a way to revive its re-election prospects.
Boeing is seeking US$25 bln in bond funding to pay its bills.
And they are in a market being flooded at US Treasuries. This quarter more than $1.9 til of US Treasury issuance will be made and markets worry buyers for that sort of flood just aren't there.
The S&P500 is currently down -2.9% in afternoon trade and looks like it will end the week with a small loss. That is a big turnaround from yesterday. In Europe overnight the sharp pullback continued from Thursday with all markets down more than -2%. That means the Frankfurt DAX weekly gain came in at +5.0% for the week, the London FTSE100 was down -0.1%, while the Paris CAC40 was up only +4.0% and taking the top off earlier strong rises.
Shanghai and Hong Kong were closed for a national holiday, but they also booked good gains for their truncated week of +1.8% and +3.4% respectively. Tokyo booked a +1.9% weekly gain.
Locally, the ASX200 ended its week unchanged, while the NZX50 Capital Index was up a marginal +0.3%.
The Australian factory PMI fell hard (to -44) with sharp declines in new orders, production, and crucially employment. But this isn't yet near GFC levels. But the longer-running rival AIGroup version of the PMI was much more downbeat (-36). Either way, its a tough situation.
But going the other way, China's official PMI's are both showing small expansions in the manufacturing and service sectors. Interestingly, these official surveys have tended to be more conservative than the equivalent private surveys. In any case they are reporting a small expansion in both March and April which is vastly different to what nearly every other country is experiencing.
In Hong Kong, riot police used pepper spray to clear singing demonstrators from a shopping mall, the first serious confrontation in months.
The Japanese Markit PMI also fell, but while it was notable (-42), it wasn't anything like the very large drops in the US, and is a drop nothing like the GFC (-30).
Back in Australia and according to the April CoreLogic Home Value Index results, housing values did not seen any evidence of a material decline in the month, despite a sharp drop in market activity and a severe weakening in consumer sentiment. But prices did slip marginally in both Melbourne and Hobart in April.
The latest compilation of Covid-19 data is here. The global tally is now 3,305,600 and up +57,000 from this time yesterday which is a slower rising rate.
Now, just under 33% of all cases globally are in the US, which is up +28,000 since this time yesterday to 1,082,400. This is the same rate of increase and overnight, half the additional global cases were in the US. US deaths are now more than 64,000. Global deaths are about to exceed 236,000. The UK death rate keeps on rising now over 15%. And Brazil has now pushed China out oif the top ten. It is hard to know about the quality of Brazilian data, especially given the weirdness of their President, but the official data seems to be exploding there. Likely the real situation is much worse.
In Australia, there are now 6767 cases (+14), 93 deaths (+2) and a stable recovery rate of just under 85%. 83 people are in hospital there (-6) with 28 in ICU (-6).
There are 1476 Covid-19 cases identified in New Zealand, with +3 new cases yesterday (+1). Nineteen people have died, unchanged from yesterday, almost all geriatric patients. There are six people in hospital with the disease (-1), but none are in ICU. Our recovery rate is now up over 85% and rising.
The UST 10yr yield is firm at just over 0.63%. Their 2-10 curve is marginally steeper at +44 bps. Their 1-5 curve is unchanged at +20 bps, and their 3m-10yr curve is also unchanged at +54 bps. The Aussie Govt 10yr yield is little-changed since this time yesterday at 0.87%. The China Govt 10yr is unchanged at 2.52% because they have a public holiday. But the NZ Govt 10 yr yield has had a very sharp fall, down -11 bps to 0.62% compounding the recent selloff and we are now lower than both the Aussie and US equivalents. New Zealand swap rates ended the week at record low levels, diving at the long end.
The VIX volatility index is rising again ending a two week decline, and it is now at 39. Its average over the past year has been 21. The Fear & Greed index we follow is neutral.
Gold has turned up today, gaining +US$13 to US$1,699/oz.
Oil prices are up again today. In the US, they are currently at just under US$19.50/bbl, a +US$1.50 gain. International oil prices are up a similar amount to just on US$26.50/bbl. But the US rig count fell sharply again, with just 408 rigs in action now, down from 465 last week and down from 805 at the satrt of 2020. In the past six week, 364 rigs have been shut down.
The Kiwi dollar has fallen overnight by almost -1c and is now at 60.5 USc. On the cross rates we are little-changed at 94.3 AUc. Against the euro we are down too, down almost -1c as well to 55.2 euro cents. That means the TWI-5 is down to 66.4.
Bitcoin is up +3.9% today to US$8,771. The bitcoin rate is charted in the exchange rate set below.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
180 Comments
Yes there it is. Those in the penthouse lavish lifestyle. Those in the basement bare subsistence. There was a post some days back about the days of the big boss earning about half as much again as middle management. Now we have CEOs and similar whose remuneration has been strapped to a rocket.And if you look at Fonterra & Fletchers in recent times for instance there have been simply disastrous results. Perhaps in NZ if those lowly graded essential workers, you know the ones that dig and clear ditches, pick fruit, clean and sweep malls and bus stations, shower our elderly in rest homes, were paid more then those jobs wouldn’t require immigrants to fill them. Don’t know how you can regulate pay structures in the free world but there is far too much disparity between top and bottom in NZ.
Politicians have been doing that for years, our Propaganda Minister is seventh highest paid worldwide. Time for a big reset. Grant robertson even said himself there would be a reset but the COL voted down the bill that would have reset politicians salaries. Regarding investment properties most of them also own rentals. Believe all the hype if you wish but you can see they have no intention to change the status quo
Foxglove
You can trace this back to Rogernomics. That was a reset of "freemarket" after Muldoonism bleak period of intervention. The Employment Contracts Act 1991 reflects this and has kept manual labour wages down while senior management wages skyrocket. Home ownership for 25 to 35 year olds dropping from 65% in 1985 to 35% today is a reflection of this period since. The lack of a CGT is yet another example.
I hear Robertson now talking about a reset in which he specifically mentions greater equality - I really hope so.
Yep Pt8, and it snowballed from there. Our local councils became “corporates” the public service morphed into “SOEs” (anybody seen Energy Corp lately?) and set about setting themselves up, empire building within, division by division, the more staff you need the more your package can grow and you can always employ ‘consultants” to do the hard stuff anyway and they can be conveniently blamed when things go wrong. Never would have thought it but perhaps Muldoon’s 60% top tax bracket comes back in and at the other end the first $20,000.00 becomes tax free.
Yes foxglove
“Homelessness” didn’t exist in my youth. Saw my first beggar on the streets in 1983 in a third world country - it was such a shock I took a photo.
Inequality in NZ Is not a value of a relatively egalitarian society that we had. While there needs to be some individual responsibility, the reality is that the current system weighs too heavily against this.
Hi printer8
While you seem to abhor inequality and the wealth gap, how much effect have the social welfare benefits played in creating it. They remove a person's self motivation. Also as you say, the ECA brought in under jim bolger, lessened the power of the unions which probably needed to be done. Interestingly Jim Bolger has almost done an about face on that recently in his statements to journalists. Mind you Jim Bolger was always good at reversing his previous statements like the reintroduction of the super surcharge after he categorically ruled it out. Certainly not the good old days. Those reforms ended up sinking the FPP system and heralded MMP, and with it NZF and the Greens. All of the political ructions over the years have been incredible.
Houseworks
I agree that increase in benefits have tried to address needs but that they have considerable negative effect.
Sadly we now have a second and third generation of some families becoming entrenched in a lifestyle of benefit dependency.
As you point out, self motivation is a significant aspect now for many. Speaking to a close friend of mine - a retired secondary school teacher with over 40 years experience - the most significant thing he took away from his 40 year teaching career was the tremendous social change that occurred.
When he and I left school in the very late sixties, the total unemployed including sickness beneficiaries was 1700 people total (NZOYB). He saw the change starting in the mid to late 1980s when unemployment grew rapidly. That was largely a result of Rogernomics.
Whatever one’s view, he also saw the DPB introduced in the mid seventies also having significant consequences.
Yes, the inequality concerns me greatly, yes there needs to be an economic reset, and most certainly a combination of low wages and benefit dependency (along with the what have become entrenched social implications)are going to create tremendous impediment.
Our current inequality and issues are not so much a result of social change, rather the social change are a result of the current economic situation of the past 35 years.
I agree with you that the union influence during the seventies especially needed to be reigned in; however IEC with minimum wages and less than a guaranteed 40 hours a week are not a great motivation for work.
I fully recognise that the widespread work ethic and social responsibility needs to change; but there needs to be change in our economic thinking which includes things such as appropriate wages and a fairer tax system such as a CGT.
There are many potential FHB on this site who are understandably very angry and frustrated regarding their inability to purchase a home. House price inflation has been considerable since 2000 (excluding the short term GFC dip); since 2011 low interest rates have been the main driver (along with high immigration, housing shortages etc) but the other significant driver over the last thirty years has been a lack of a CGT. Yes, boomers - including myself - have leveraged against their homes to buy investment properties free of a CGT forcing house prices out of the range of FHB. That is part of the free market elite thinking and has got to change (yes irrelevant in the current short term of likely house price falls but for the longer term, yes). I know, as did every investment property owner I knew, I was looking to cash flow positive, but equally, a tax free capital gains was just as significant. Any one saying otherwise is lying. I note a change on this site; over the period 2012 to 2016 every man and his dog posting about investing in property.
I don’t like the inequality I see, and I don’t like the inability of young being unable to get into their own home for both intrinsic and financial security.
To implement a economic reset is easier than resetting the social consequences of the past 35 years. Let’s start with the easier economic reset.
Houseworks
Labour with a majority to govern alone as the leaked (yes, biased) poll indicates is a possibility. Robertson’s comments on a reset including greater equality. National would only continue the current system and increasing inequality of the past thirty years.
You would have seen the comments from JK recently that he still disagrees with the FBB. The FBB has made no difference to median prices, but I like the fact it has made NZ prpty more exclusive in this global world and ... [ Don't do that. It's neither funny nor clever, nor is it "making a point" other than one that reflects badly on you. Thin ice. Ed ]
Exactly. And that's the point. The legislation is racist when it lets Shirl and Darryl and their Singaporean cousins come in but discriminates against those from other countries. Still it obviously had little or no effect as prices were going up faster than ever. But I like it because it makes nz property more exclusive and those who really want to come and live here, make a permanent home and be committed can do so. We will get more citizens and better quality ones.
Houseworks and Fritz
I stand to be corrected but I think the Singaporean advantage is nothing to do with any form of racism but more to do with historic alliances. New Zealand had a military presence in the form of a base in Singapore for many years and I think that this preference reflects that special relationship.
A similar situation is that Kiwis do not require a visa for entry into India whereas Australians do. That has absolutely nothing to do with race, rather that there was a very strong relation between India and NZ due to India's respect for the humanitarian work done by Edmund Hillary in Nepal (and he was ambassador to India)
Yip - executive pay is something that seriously needs to be looked at.
Check out these charts from the US, highlights the inequality issues they're going to have to address over there.
https://www.nytimes.com/interactive/2020/04/10/opinion/coronavirus-us-e…
There are countries that change their immigration rules if it appears that immigrants are dominating a trade. But NZ needs low paid immigrants to prop up our housing bubble and low productivity economy. A decade ago I attended Massey Uni for a year - it was interesting to note the ethnic strata from lecturers to students to cleaners - interesting but the sign of an unhealthy society. Just pre-Covid I attended 'senior activity' at our leisure centre and the geriatrics were pleasantly diverse - various Asian, African, Pacific, Maori and native born New Zealander - maybe too many immigrant POMs like myself but pleasantly diverse because we all knew we were Kiwis at heart. Post Covid maybe our govt will actually discuss immigration policy and aim for social cohesion.
The oil story tells us more than all the 'data'.
The amount of energy going into a system absolutely tells us the amount of work being done.
Yet we still see all these bets, and what are effectively nothing more than totalisator-odds, being read as if they tell us something real. All they tell us is the level of lemming-like fear at any given moment. Why is it that as a society, we steadfastly insist on measuring nonsense?
https://www.iea.org/reports/oil-market-report-april-2020
For those wanting to learn a little more about how things really fit together:
https://ourfiniteworld.com/2020/04/21/covid-19-and-oil-at-1-is-there-a-…
Ooops.... BBC Elon Musk tweet wipes $14bn off Tesla's value. "Tesla's founder Elon Musk wiped $14bn off its value after tweeting its share price was too high in his opinion.
The tweet also knocked $3bn off Mr Musk's own stake in Tesla as investors promptly bailed out of the company.
https://www.bbc.com/news/business-52504187
This is what powerdownkiwi is saying above.
'Yet we still see all these bets, and what are effectively nothing more than totalisator-odds, being read as if they tell us something real. All they tell us is the level of lemming-like fear at any given moment. Why is it that as a society, we steadfastly insist on measuring nonsense?'
This is a bit of an unforeseen consequence of the lock-down and rush to subsidize worker's wages:
Staff urged to come back to work and save their jobs and the economy
A lot of workers are quite enjoying their holiday at taxpayer's and employer's expense. A lot of things including poor behaviour can now be excused because of Covid-19. I've even found myself daydreaming about being made redundant and being able to blame my circumstances on the virus. I'd probably register as unemployed as it would no longer seem shameful to be asking for a handout. It was the virus that done it after all. I probably wouldn't get anything though but it could be fun LARPing as unemployed and down on my luck.
The government and the MoH have put the fear of God into the poor old hoi polloi so it's no wonder they are expecting to be fully looked after. I can't help feeling that Sweden will be the country to have done things right, emphasizing personal responsibility. Yes there is a cost but there is a reason for it too.
Don't talk rubbish Henry even your hero President Trump has tried to ride on NZ's merits with how we've managed to halt the corona virus and ease restrictions fairly quickly.
Remember this it's hilarious; "Tucker discusses how New Zealand and Australia handled the Coronavirus pandemic by following President Trump and closing their borders to international travel to and from China." : https://www.youtube.com/watch?v=Iqbiosrn5Ko&feature=youtu.be
Miranda Devine is Australian.
Trump going first with border stop, paved the way for Aust & NZ to do so, she say.
Managing borders work, it like social isolation between countries.
NZ could have gone earlier and harder with borders. Many dates, like when China stopped sending packages tours here, advice etc.
Here is Donald Trump, makes no mention of NZ
https://youtu.be/uCLirKOcYrg
Fact is Henry Trump didn't succeeded is stopping the coronavirus did he, too little too late! Even when he so called closed the US boarder with China, US citizens and certain qualified foreign nationals were exempted. Nearly half a million people had travelled to the US from China since the coronavirus was announced to international health officials in January, The New York Times reported on April 4. There were 1,300 direct flights between China and 17 US cities before Trump's order, and many who travelled received "spotty screening" upon arrival, according to the newspaper.
Aljazeera article: https://www.aljazeera.com/news/2020/04/trump-coronavirus-claims-fact-ch…
Oh and by the way Henry, Trump is still falling in the polls. In fact you can almost cross correlate it with the states that have had the biggest impact from the virus switching to Biden.
538 Article: We’ve Got Some Early Trump vs. Biden Swing State Polling. "It’s now clear who the Democratic nominee will be and that the novel coronavirus pandemic will be a major part of the campaign."
Link: https://fivethirtyeight.com/features/weve-got-some-early-trump-vs-biden…
Morning CJ.
11th March 2020.
Here is the mayor if New York. When NYC had 25 cases.
USA has Governors too.
Morning Henry, Keep up! Did you see that the US is still spinning out of control with their coronavirus death rate, so much so it's hard for the media to keep track. Currently more than 65,000 coronavirus-related deaths have been reported in the US, according to the Johns Hopkins University, but experts fear the real figure could be much higher (World meter show they've shot up to over 67,000 deaths).
And it's going to get worse. "Around half of US states have started relaxing lockdown measures but the governor of New York said such a move would be premature in his state, the worst-hit in the country".
Can't see that curve flattening can you.
BBC Coronavirus Live feed: https://www.bbc.com/news/live/world-52512663
Worldmeter Coronavirus: https://www.worldometers.info/coronavirus/
Firstly I doubt that people are just being lazy. I know how ever that there are a lot of very worried Landlords out there, who are sitting on the backsides worrying that workers are going to be laid off and they won't able to pay the rent. Perhaps they should have thought about that a few years ago rather than continually pushing up prices and rents, forcing up the cost of living to sky high levels.
You're the one using the word "lazy" not me. I said poor behaviour. It's pretty poor to let your employer go down the gurgler because you are a scaredy cat all the while demanding to be paid.
I don't think people can really help it though as they have been acclimatized by the government's poor handling of the situation.
Or what about government workers? I am hearing stories of government workers unable to work from home as they have not been supplied with secure laptops, asking to be able to go in to the office, albeit with safe social distancing, and being refused the opportunity to work. So they sit at home getting full pay doing nothing. Worse still, some of these workers provide work to the private sector, so some small companies who rely on this work are, after five weeks of no new work, running out of work for their staff, because the government won't invest in laptops or allow their staff that can't work from home to enter the office. Madness. Maybe some of this shovel ready money should be used to set up all government workers who provide projects to the private sector, to be able to work from home and keep the economy flowing...
It's not a question of government stance. It's an employment matter. If the workplace has approved safe systems in place for work at level three, and have asked employees to return then employees must attend work or risk their employer invoking the abandonment of work process for laying them off.
Yes that's a whole 'nother matter, but strictly speaking not for the employee to have an opinion (the effectiveness of their employers L3 protocols), unless they genuinely think their working conditions are unsafe in which case they follow the protocols outlined the health & safety at Work act to raise the issue, and if they have done that and disagree with the outcome, they need to lawyer up if they choose to not attend yet still expect to retain their job (or get an ERA mediator to step in and try to find a way forward)
"Dummy Run"how ironic. Darwin at work
https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12328310
I suppose David Clark will be MC.
Or maybe Dr Bloomfield if he does not ban this shocking proposition, which has all but been OK'd by a cop who should not have the authority to allow 100 drunks to gather indoors.
It has cost ? $50 billion to get this far, what a terrible example to set.
The only Economy at the moment is Fiscal and Monetary policy by reserve banks and bail out / money been thrown by government to protect be it wage subsidy, Business interest free loan, helicopter money or dole.
With blanket cover to all many are suffering but few are minting by exploiting the system.
One of the example may be contract workers like company hiring delivery boys which has not been 30% affected but the parent company may reduce their payment to company hiring contract worker by 30% so that the company can avail the wage subsidy of $585 which may be much higher than 30% - may be 70% or much much more higher.
"The only Economy at the moment is Fiscal and Monetary policy by reserve banks and bail out / money been thrown by government to protect be it wage subsidy, Business interest free loan, helicopter money or dole."
I was listening to a Rabobank analyst on the radio the other day - he believes post Covid, this will be THE economy. No supply and demand, only government bureaucracies in lockstep with cheap printing from Central banks.
That is assuming that the governments and central banks themselves won't collapse. I mean, maybe not straight away, but the system they have built and wedded themselves to, is incredibly fragile and experiencing the greatest shock it has ever known. It might not survive.
And hypothetically...if it did collapse... there would still be an economy. There always is. After the Bronze Age and Roman Empire collapse, there was still an economy, people still produced and serviced and bought and sold. I'm not suggesting anything that extreme might happen, but even in the worst systemic collapses in history, people still made bread, built houses, had haircuts, made babies.
We need to be back at level 2 NOW. I am hearing from more and more contacts of job losses and reduced hours. Stories appearing in the media too.
There is basically no community transmission so let's get on with things
I reluctantly came around to agreeing with the lockdown but it's time to move.
Yep.
And to help, tell how it is.
1. Ppe, test kits. How much we got, what we need, how gap being dealt.
2. What the now performance of contact tracing system, what is the spec of the tracing APP.
3. What's the plan, no virus, or some virus & blitz hot spots.
4. What's the border quarantine plan.
Tell us.
We don't want lockdown measures to be the counterbalance to poor planning, rotten supplies or not having taken MoH advice.
Again.
https://youtu.be/WxAEnUCIY_g
Dr Campbell mentions NZ core position.
Go to level 2 and follow the Swedish approach if things flair up again is probably the only sensible way forward. Let everyone know beforehand too.
We can't keep on locking down, its a one off. Everyone has been brainwashed by the government and media, especially the media, to believe that this is the second coming of the Black Death. The trouble is the health departments were asked for their honest opinion on what would happen and they tended to exaggerate a bit erring on the safe side as you do not realising that the government would freak out and lock everything down. This may well have been a bit of an unexpected result of their advice. They didn't think the government would do that,as after all, a Mad Max 4 scenario, would obviously be worse than even the worst case scenarios which were unlikely to eventuate anyway.
level 2 or in Sweden , with the laughing loquacious in a confined space....go for it Z
Or if you can't wait, be a good lemming and get into the"dummy run"you could meet the real loud local unmasked who spray it, not say it.
https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12328310
You seem to be the one who is mistaken. Sweden is on track to keeping things managed. In fact the WHO have just come out and stated that Sweden's approach is probably the one to follow:
Dr. Michael Ryan: (43:56)
" I think if we are to reach a new normal, I think in many ways Sweden represents a future model of if we wish to get back to a society in which we don’t have lock downs, then society may need to adapt for a medium or potentially a longer period of time, in which our physical and social relationships with each other will have to be modulated by the presence of the virus. " Link
Exactly what conspiracy theory am I repeating? Have you looked at the data? I have and things look pretty stable.
https://www.worldometers.info/coronavirus/country/sweden/
High and sideways moving daily new case trend ---> continually growing active case numbers. Think about what the trajectory actually looks like over 6 months. That's assuming no Singapore-style sudden return to exponentiation after a period of linear growth.
They are gambling on herd immunity but have no idea if or when that will kick in.
Singapore was the original no-lockdown poster child. Now in lockdown.
The conspiracy theory = it's all a media beat up, no worse than flu, etc etc.
You can't stay locked down forever. Those countries around Sweden will have to follow the same path once they open up again which is why the WHO are coming around to the idea that Sweden will be the model to follow.
Many aspects of this are very much a media beat up. It's about three or four times as bad as the real flu.
No one is proposing staying locked down forever, the point is if your policy settings leave R above 1 you end up with a long slow hospital overload instead of a short sharp hospital overload.
By the way, the guy you're quoting from the WHO is the same guy who advocated aggressive pre-emptive lockdowns, but don't let that get in the way of a good Jacinda-bash.
And the WHO have got such a great track record on managing this thing after all. Let's see, no human to human transmission. Masks don't work. Travel bans will make it worse. Have I missed anything?
"It's about three or four times as bad as the real flu." Come on then, let's have a link to whatever Murdoch rag you call a reliable source.
People are advocating repeated lock-downs or lock-downs until a vaccine/cure is found.
The fact that the WHO got so much wrong adds legitimacy to people questioning what is happening. It seems we are getting to some agreement here so cut out the accusations of pushing conspiracies.. but surely the WHO can alter their advice as more data comes in?
Three or four times worse than flu is fairly serious. It would imply three or four times as many people catching it and three or four times of those having serious complications as compared to standard influenza. However this is probably more the case with the older patients. Such comparisons are probably of little use as all flus are a bit different with some being more deadly for younger people. No links at this stage as it is really just my gut feeling from looking at the figures.
We have to learn to live with it and manage it. Certainly in other parts of the world. The main failing was perhaps the failure to protect the aged care facilities. A pandemic should have been foreseen with a lot of PPE ready and action plans in place long before the arrival of Covid-19. It's a difficult situation though as these places are basically waiting for the patients to die from something in a tacitly controlled way and pneumonia is often the cause and resuscitation is avoided . No one likes to talk about it. It would be wrong to expend huge amounts of money on extending the lives of the very aged and frail. We could do it but up until now we certainly haven't and I personally hope we don't start doing that.
Job losses are only just starting.
I'm back building and the decreased production from Wuflu protocols and time loss in getting materials is large. It used to be 50/50 60/40 labour/materials depending on the job labour now I'm guessing it will be 70/30 75/25. Work on the go that needs to be completed will get done but I wouldn't be rushing out to engage builders at present for nonessential work.
Building labour costs will be much higher, plus 10% at least, guessing 18 to 20 percent higher. Pick up a tool, use it wipe it down. Start later dealing with the paper work, finishs half an hour earlier to bring bio hazard bin and tracing paper work to the office. Materials hard to get at short notice, so something small and ordinary may hold you up for an hour.
People will have lost the capacity and appetite to pay those higher costs though. So some "price discovery" is likely to be required.
In our company we are working longer hours and charging less, pretty much all our clients also are. That's the reality of a recession. If tradies think they are somehow immune from that, they will be in for a shock.
Remuneration deflation. Lose your job, work fewer hours, reduced wage rate, no hourly wage increases and/or no at risk remuneration. At the lower end the unskilled will fight more skilled people for the minimum wage jobs. 20% seems to be the common drop so far and many losing their jobs won’t show up in the unemployment stats as you don’t bother applying for the dole until both partners are out of work.
We didn't wait to be asked. We just immediately offered all our clients who we knew would be hard hit, the chance to pause our services or continue with a 25% discount. Our clients are global, but majority EU/UK based and we took an immediate hit in March (lost about 30% of clients) and then over April have slowly clawed back about half of that with new clients and even a few returning clients. So currently about 15% down YoY. We have stress tested for a longer term loss of 35%. Our business is SEO/content/web development/online marketing and our losses are directly related to other businesses going under and a sudden loss of business optimism. Arguably, you would expect a business like ours to be one of the least affected by the circumstances, so the fact that we have already taken that kind of hit, should give an idea of how much worse it is for others.
Its gonna be tough for a lot of people who arent used to it. But maybe a bit of austerity is what NZ needs again. As a nation we waste on fast foods and uber eats as well as smashed avo on toast, everyday, but looks like the last 5 weeks has not made a blind bit of difference
Yes a little tongue in cheek but haven't you heard of living within your means mate. Or are you one of the privileged and entitled who has never had to worry about money, never had to scrimp. Shit mate I've been there trying to heavily limit spending to save a few dollars. My saying to myself at that time was that savings equals freedom. And also "a dollar saved is a dollar earned". It seems now that my efforts paid off (not blowing my trumpet, just saying)
Yawn. Self made as they come. That's the thing when you grow up broke in a country with lots of investment illiterate Boomer muppets blowing a housing bubble, makes you resourceful. Can't just tick up a business startup on home equity as is customary among your lot.
Yes own tools but to mitigate the transmission between your bubble and the work bubble they need to be wiped down.
Large sites have communal tools and guys are in mini bubbles within that.
Smaller sites that you have to pack up and transport tools at the end of the day, you need to wipe down at the start and finish of the day.
No going to get lunch, coffee. 24 hours instant stand down without pay if you break the rules.
Most guys are good but others are others are 'this is all BS blar blar"...
And if there is a cross contamination and your protocols were found to be lacking.
Fail to mitigate risk that resulted in death on site either 3 years in jail and $5mill fine or the other way arround.
Labour will be keen to push the blame onto whoever they can, to win the next election.
I hear you but as always there are rules set out by the power that be and if you dont follow them you may have to pay the price or you get away with it. Health and Safety, there is always someone responsible for that accident.....
I can't expect the apprentice that is working with me to use his own tools. He only has the basics.
Then the virus could be trnfered from my tools to something I touch.
If it was me calling the shots, I would cross my fingers but at present I follow the rules.
But haven’t you heard? The virus has been eliminated! ELIminaTED! Government says so. And here we are in level 3. Why? Because this government is as confused as most of the rest of the UN are. It’s just crazy implementing such protocols at the workplace when we’ve Eliminated the virus. Surely, right? Nope, wrong. On one hand the virus is eliminated yet on the other hand were still at level 3 which means there is a “High risk the disease is not contained”. Jacinda’s ego is disgraceful. She wasn’t the first, were not the best. Stop self
Promoting and get on with it!
Agreed. Lockdown worked, we smashed our infection rates into the ground, we have no reported community transmission, we bought time to adapt and increase hospital and testing capacity. We have done everything we set out to do.
Why do we have to wait until 11th May for any further information? At least let us know now what the criteria is, lets give people hope and something to plan towards. Surely they can make some kind of announcement to say "if we find no community transmission and numbers continue to trend down level 2 will begin on X date".
Exactly.
It would be good if they came out on Monday and said we are moving to Level 2 on 11 May. Business is in desperate need of certainty, decisiveness and urgency.
Btw have I got this right - level 2 only permits essential travel between regions, so basically there's no hope for domestic tourism till we get to 1?
Well they might redefine the levels again. More clarity in general would be better. I can understand that the whole thing is a moving target, but they could at least explain the metrics and variables that they are basing their decisions on.
My guess about their motivations, is that they want to see how compliant the population is to determine whether their plan is viable. Ie, they need to be able to contact trace, so they want to see how well people comply with giving out their personal details here, there and everywhere, during level 3 to see how viable that strategy will be scaled up during level 2.
The boundaries between freedom, safety and privacy are always in flux between citizens and authorities but the pandemic is a whole new level of compromise.
We are down to around 200 active cases spread over a population of 5mill or so up and down NZ. Many of the 200 are in rest homes and contained therein, the rest are identified and under control. The international borders are closed and any incoming citizens quarantined. The only thing better than this would be zero of everything which is what we were initially told eliminate meant. Seeing as how that no longer applies are we not now where we need to be and the lights can go on again?
There are a whole lot"under investigation", which is Bloomfield-speak for"we don't know where they came from but hoping they'll go away"I'd call it community spread, unkown origin.
Remember it's only 2 months since our first cases popped up, and we still don't have adequate PPE for a rebound of disease.
Having made their bed on choosing this lockdown methodology, they have to follow the script, which is means any increase in cases will be seen as a failure.
These decisions have been just as much political as based on facts.
I think that one of the main issues they have is that when they did random community testing a few weeks ago, they found NOTHING. While many might think that is good news, I don't think it is. What would have been better is to find that a large % had the virus and had recovered without showing any symptoms and now they could provide herd immunity for those still vulnerable when the restrictions eased.
Since the symptoms take a few days to show and then testing results a few days after that, then they will be worried that the easing into L3 might cause an upward trend in cases that they are still unprepared for with logistic issues with testing numbers, tracing, and PPE, etc.
There are a couple of other things that leave me considered about thinking or lack of. Apparently an individual can't self diagnose that they have CV19 and you have to be tested to prove that, but once you have it, and an individual can self diagnose after being 'symptom-free' that they don't have it. I would have thought they should be retesting all confirmed cases even when symptom-free to prove they don't have it.
And they have made no mention that we are not even in virus season yet, which is mid/late winter and early spring, and that there are clear links between seasonality and virus transmission, and how this seasonality impacts on our indoor temperature, relative humidity, and air quality, and how of poor build quality makes this worse.
They are wilfully flying blind on a lot of things they could do to reduce the infectivity of the virus and the impact on the economy.
Dale Smith, unfortunately the science so far on seasonality is conflicting. At the very least, there is insufficient data yet to make any decisions based on humidity/temp etc.
Historically, viruses do often develop a seasonality, but that isn't always apparent with a new virus to begin with, the seasonality develops as the virus becomes endemic within populations (which can take years).
The science on seasonality (and its effects on the indoor environment) is very clear to those of us in the industry and there is plenty of data going back decades to support this.
Google the Sterling Humidity chart from their 1986 literature review in the subject.
Even the outbreak in Wuhan is exactly at the latitude and time of year you would have expected it.
There are numerous studies on this, Here is a short summary by one: https://vtnews.vt.edu/articles/2012/12/121312-engineering-flucommonduri… plus this one https://around.uoregon.edu/content/uos-indoor-research-center-takes-aim…
Covid 19 has been following an established pattern already, and even if it was not so obvious from the start due to its newness, all comparable evidence would have said to follow the trend with previous virus patterns. And the newer studies specifically on Covid 19 are supporting this.
This issue goes back to the very essence of our poor quality housing. Many are cold, damp, and support the growth of harmful pathogens.
The evidence shows the best indoor environment to reduce the infectivity of viruses and at the same time to enable the human immune system to operate at its best is a temperature between 20 to 24C, relative humidity between 40 and 60%, and excellent ventilation.
Where seasonality plays a major role in indoor air quality in regard to virus transmission is the when cold winter air is brought inside and warmed up, the relative humidity drops and in general, this makes it too low and right in the area that viruses are most infective, with one of the primary reasons being that the low RH causes them to shrink (dehydrate) in size and they can become more airborne ie spread further to find a host.
The Govt. is not talking to all the right people.
But that is what has been happening. Those who were infected and recovered were being tested again and showing positive.
https://youtu.be/QwXM821iBrI 2.45m
Still doing ~5000 tests a day, from people that have reason to be tested, and getting single digit positive tests a day, mostly traceable to existing cases. There's not a lot out there to find. The key is to jump on every positive test and nail contract tracing, isolation and testing of all those contacts, otherwise you are looking for a needle in a field of haystacks.
I didn't say it was wrong, I just said they didn't find anything. To repeat I am saying maybe you want to find that the virus has infected the greater community without any effect as has been the case in many populations overseas. You are saying not finding any signs is a good idea, I am saying , maybe it's not.
What needs to happen is the population needs to build up an immunity either by controlled herd immunity and/or by vaccination. What we seem to have done, rather than flatten the curve, is to suppress it altogether.
So how do we keep the population safe if not by herd immunity and/or vaccination, we are only left with a long-running lockdown, whatever that may look like.
With the testing they are doing, finding nothing is the right result. We are trying to eliminate the immediate risk, which is uncontrolled spread of the virus, the rest is a distraction, and can be left for planned and properly controlled studies once we have eliminated uncontrolled spread.
We eliminated the immediate risk when the curve was within our capacity to handle the virus which was some time ago based on the stats. Anything else to total elimination means we can only keep that state by staying in a lockdown of some stage until a vaccine is found.
We know who are the most at risk and should make sure they are safe, which we have sort of done, but again they are missing the obvious on that as well, but they already think we have some control, otherwise, they would not let school resume.
That has nothing to do with what I posted above, which was about your illogical statements about the community testing not finding anything. The community testing is looking for people that are currently carrying the virus, so the PCR test is the correct one to use, and zero positive tests is the result we want.
Your reply is also irrelevant, because antibody tests could come back positive while you are still infected anyway. They don't prove you've had it and recovered, just that you have started to produce antibodies, which happens before you recover.
I made two observations, one on the community testing and one on testing people that had 'recovered'. As Kezzas points out testing overseas is finding people that are supposedly recovered still testing positive. My main point on the 'recovered' is why would you let infected people self-diagnosis they have recovered?
So at present, we don't know what % of the recovered are really recovered, and we seem to have no infected symptom free in the general population.
And while we Kiwus are forced to take pay cuts, lose our jobs, shut our businesses and drop the prices of everything we produce, our rapacious Oil Companies have kept the price of fuels at extremely high levels
They are a disgrace and we should start a boycott , one fuel co at a time for 90 days each starting with BP and ending with Z
It will quickly bring them to their senses
What chance anyone recognises which New Zealand bar this is? https://twitter.com/Video_Forensics/status/1256341513975459841
And they are in a market being flooded at US Treasuries. This quarter more than $1.9 til of US Treasury issuance will be made and markets worry buyers for that sort of flood just aren't there.
The US yield curve is shouting out there is not enough supply to meet demand.
The collateral side. In a mad dash to preserve individual liquidity margins, even survival, pristine collateral is in huge, overwhelming demand.
The most pristine of pristine collateral is the Treasury bill (always OTR, and effectively a money equivalent). Again, basic economics; the price for collateral is driven way, way up. But since bonds also have yields, as the price for the securities skyrockets the rates associated with them must therefore plummet. Link
One big reason why is, say it with me, collateral. Believe it or not, the FOMC actually provides some useful information in the latest minutes on that very subject:
"In the Treasury market, following several consecutive days of deteriorating conditions, market participants reported an acute decline in market liquidity. A number of primary dealers found it especially difficult to make markets in off-the-run Treasury securities and reported that this segment of the market had ceased to function effectively. This disruption in intermediation was attributed, in part, to sales of off-the-run Treasury securities and flight-to-quality flows into the most liquid, on-the-run Treasury securities."
I’ve tried many, many times over the years to succinctly describe an acute collateral shortage, and I dare say nothing I’ve ever written in my time watching repo and collateral markets comes close to that passage. Link
Madmen running the asylum. Has been that way at least since the GFC... you don't have to look further than NZ to see it with our RB thinking "Negative rates will help!".
Time for collective governments to figure out a better system and tear apart central bank mandates. Its not working and whatever they do now will only make it worse.
Dalio thinks its probably the end of the long debt cycle. Fiscal and monetary policy may have little impact moving forward - the horse is lame. The earnings can't service the debt and more stimulus just creates more debt. Deleveraging and debt restructuring might be the only way forward. Debt defaults etc means it could be messy the next 3-5 years and people play hot potato to see who is left holding the bad debt.
We already know who is going to be left holding the bad debts!
The Public Balance Sheets, in their many guises. Be that the Taxpayer (called Government in an anonymous sort of way); Superannuation Funds ( Shares etc will be dumped into them as cash is removed to the Private Balance Sheet via buy-backs and simple sales) or 'safe' asset holders of many kinds, (who will see their collateral vastly diluted by fixed debt against floating value.)
Whichever way we look, it's 'us' that is going to end up with it.
BAME deaths in UK
https://www.youtube.com/watch?v=8L7s7Z6nECQ
Convenient you can't back up your claim. I haven't thrown any numbers around you might have noticed. I've had a quick search, can't find historical stock levels, can find rental prices, but thats no use.
Your answer.. usually to hit report comment when called on your BS isn't it?
When you borrow money you are pledging future earnings. You are eating tomorrow's lunch today. That also allows you to consume resources today pledging future earnings, you are bringing the future forward by using credit.
If tomorrow isn't looking as good as you thought, you get to pay that debt back in tougher times, if it really gets ugly, you face a much reduced standard of living.
Just my thoughts, keeping it simple.
https://wolfstreet.com/2020/05/01/the-bone-chilling-collapse-in-demand-…
ME Bank is no.5 or no.6 in Australia. Owner by superannuation funds and union friendly.
- or maybe was.
https://www.smh.com.au/business/banking-and-finance/despicable-me-the-b…
The boutique bank owned by the industry superannuation sector has blindsided its customers by removing cash from accounts linked to home loans during a global pandemic that has increased financial uncertainty.
Members Equity Bank, which is owned by 26 major super funds linked to big unions and markets itself as one of the country’s most trusted lenders, stunned customers on Monday when it, without permission, removed funds from redraw facilities to pay down home loans.
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