It's a long way back

Stephen Toplis says that despite winning the virus battle, it is no time for complacency. The economic costs will be massive and we will be left with enduring problems

3rd May 20, 9:19am by Stephen Toplis

The BNZ economists have produced a very useful chart pack, From Rescue to Recovery.

In it, they trace the steps from the winning of the battle against the virus all the way through to eventual economic recovery.

It is going to be a long and uncertain haul.

In between they see massive costs and enduring problems, problems like entrenched unemployment and huge debt levels.

They also see bloated public balance sheets that will limit the options of what we can invest in and how we develop our nation.

Private sector investment is set to crash, in turn undermining any progress in national productivity

They also see a sudden u-turn needed in new house building. And without it presumably we will have a long-term oversupply and depressed market prices for years to come. This may be the housing reset we need to get back some reasonable affordability.

There are some clear losers. But there will be winners too, which they identify.

And of course, our 'recovery' will be highly dependent on the international recovery, and that looks certain to be a very long way off. Apart from China, it hasn't started anywhere yet with most major global economies nowhere near the end of the beginning, let alone starting any recovery.

This chart pack, From Rescue to Recovery, is here.

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177 Comments

by Theoracle | 3rd May 20, 9:42am 1588455760

God that's so depressing.

Informative slides from BNZ there.

Not a lot of answers on where to next...

by powerdownkiwi | 3rd May 20, 5:41pm 1588484475

They're bankers, and they're also part of the consumption-of-a-finite-planet-as-fast-as-possible society we constructed.

So they won't have the answers.

But some of us have been working on them for years. It's just a matter of the media wanting to listen. Who knows, perhaps DC might publish what I think is quite an important piece on capacitance......... but then again, he might not...... It is one of the needed discussion-topics.

by Kate | 3rd May 20, 7:09pm 1588489759

Are you able to link to it, pdk?

by Mark Hubbard 1965 | 3rd May 20, 10:02am 1588456978

Contrarian, but we now go into steep deflation, but that followed by huge inflation and skyrocketing real interest rates that central banks will lose control over. So given sharemarkets are set for massive devaluation to fundamentals, there is no fixed income anymore, and as rates approach zero the lovely bond rally right now ultimately becomes a rout, for first time in a long time I’m thinking the second debt-free house is starting to be a hedge. If nothing else you have a holiday home to eat your takeaways in.

by Independent_Observer | 3rd May 20, 10:42am 1588459373

Didn't the report say share prices to 'claw their way back' or similar? And 'house prices to tumble'?

by Mark Hubbard 1965 | 3rd May 20, 11:01am 1588460473

Well the first proposition is in total denial of reality, and I think phase 3 of the bear market has started out of the US on Friday. And then that must cast a shadow on the second housing proposition... although house prices are going to topple, obviously, short term, that’s why it *will* be a good time to buy before Christmas. Remember we now head into deflation, then after that inflation that central banks won’t finally be able to control even in the Harry Potter economy they created pre-Covid. The house is the hedge against that future inflation.

I’m just musing, but there’s no investment asset to generate a return anyway; stimulunacy has turned everything toxic.

by Ex Expat | 3rd May 20, 2:17pm 1588472279

Sounds like a good strategy for early retirees. I'd prefer a second property to Kiwi Bonds, it's just a matter of seeing where the new taxes are likely to come in.

by fat pat | 3rd May 20, 7:41pm 1588491665

I think you're right Mark. If for argument sake you define real_interest_rate = best_2_year_mortgage_rate - CPI_inflation. Then CPI is, and will be grossly under-reported making real rates even better than they appear (for borrowers). Eventually though something similar to what happened in the 1970s under Volcker will happen again, and that will smash house prices. I guess that could be 5 or 10 years away, and a lot could happen in the interim.

by Lapun | 3rd May 20, 10:58am 1588460326

2nd debt-free house is what I have (almost) but if a govt wants to raise money and keep house prices down then it will introduce some form of land tax - probably via the annual rates bill. Homes are an asset that protect against inflation but are impossible to hide. Ideal item to be taxed via rates and stamp duty and those who complain will be labelled as whinging wealthy.

by Mark Hubbard 1965 | 3rd May 20, 11:03am 1588460594

Agreed that is a concern; we’ll be taxed out of near-existence by a hugely bigger state across all income and assets well into the next generation.

My plan B is the revolution.

by Speechless | 3rd May 20, 5:24pm 1588483450

"My plan B is the revolution."

Heh. The Boomers are the ones who need a revolution to protect their right to steal from the future. Now I've heard everything. Vive la spéculation immobilière!

See you at the barricades.

by Mark Hubbard 1965 | 3rd May 20, 5:28pm 1588483716

Well, again, these comments make me speechless, Speechless.

It's the boomers who've largely paid to bring you all up. It's the boomers leaving you their wealth which will mean you never have to work like them.

I thought I'd be retiring in a free country with a small state. It's always with sadness I realise it's the opposite.

Must keep away from Interest.co.nz comments.

by Speechless | 3rd May 20, 5:34pm 1588484085

"Well, again, these comments make me speechless, Speechless."

Apparently not...

Go look at the stats on relative wealth and income between generations at the same life stage. The data are in. Like many Boomers on here you either haven't bothered to look at the data or can't read stats with a gun to your head.

by Mark Hubbard 1965 | 3rd May 20, 5:46pm 1588484760

Yet I'm working for the generation of boomers who are handing their wealth down to kids many times in their thirties who are just out of home, whose mortgages and business loans (and investment property loans) are possible because secured by the boomer parents taking I think far too bigger risks in their retirements. ... go figure. Many boomers wish they'd been so lucky.

But you know what: this place depresses the hell out of me.

This time I am out.

by Independent_Observer | 3rd May 20, 5:54pm 1588485283

You know why they'll be gifting their wealth down right? So that they can claim more from the government when they get means tested later in life and at the same time allowing the next generation to pump a property bubble.

by Speechless | 3rd May 20, 6:05pm 1588485931

Ohhh how generous of you! Except if you hadn't hoarded all the houses in the f-ing first place they wouldn't need to be 'handed down.'

And how about those of us whose parents aren't rich and won't be inheriting a red cent? My dad is an alcoholic and doesn't own a house. Your dynastic trickle down helps me how exactly? Rich kids get a punt and if you chose the wrong parents tough bickies yeah? Visionary thinking, what could go wrong.

"This time I am out." Don't let the door hit you, see you at the ballot box.

by Kate | 3rd May 20, 7:23pm 1588490595

I've always been in favour of a 100% inheritance tax. Although I know that might be easier in theory, than in practice. I figure if people want to contribute to their children's well being, they should do so while they (the parents) are living. And if they have more than what they and their own families need, that excess ought to be used for productive purposes, e.g., set someone else up in business for a share of the profits.

Intergenerational wealth is more a blight on society than intergenerational poverty - given it's likely we wouldn't have the latter without the former.

by GV 27 | 4th May 20, 7:18am 1588533496

I'm not sure anyone can say this with a straight face given the current Government's attitudes towards poverty, which is to use it as a political platform but not actually do anything about it. That seems like more of an issue than someone leaving their kids $250K, probably their only real chance at ever paying off a massive mortgage. Maybe we should try fixing that first before we tax people for having the nerve to, you know, die.

by Lapun | 4th May 20, 8:02am 1588536153

'easier in theory'! You might as well be in favour of always telling the truth and never committing sin. I've never read King Lear but wouldn't it be relevent? Laws should be based on how people really behave not on how you would like them to behave.
Sense is 0% inheritance tax but various hard to avoid wealth taxes; for example GST on all property sales, stamp duty on all property sold at an above average price, etc.

by Independent_Observer | 3rd May 20, 5:39pm 1588484344

For every credit (the wealth you refer to) that boomer's children will inherit, there's an equal matching debit in the system for them to service. Think about that for a while.

by Mark Hubbard 1965 | 3rd May 20, 5:42pm 1588484552

As has always been the case. You're not a special case. ... and you stated you were paying tax above, are earning good income and have nothing to complain about .. so I take it you're a boomer?

by Independent_Observer | 3rd May 20, 5:52pm 1588485139

Who said I was a special case because I'm certainly not claiming to be?

How are boomers going to leave us their wealth if they're leaving equal debts for each part of wealth they've created? You said it above.

I'd much rather receive less wealth from the boomers with less debt in the system, giving future generations a better shot at, well, everything. We're likely to receive a debt burden and superannuation burden as boomers retire/start dribbling into their PJ's at the Summerset village.

by powerdownkiwi | 3rd May 20, 5:48pm 1588484911

No they didn't, MH.

They allowed thenselves free education and low rents, but the Limits to Growth (which they've done a good job of ridiculing for 50 years) forced then to charge the young (and the future) via increased rents and student loans. The only offset was slave-wage offshoring of stuff we are told to consume.

Try googling World3. Notice what happened to each of those trend-lines during the BB era.

go well (while you can)

by RickStrauss | 3rd May 20, 6:31pm 1588487508

There was an analysis here on Interest a year or two back, highlighting that boomers might end up on average being a net negative contributing generation. A lot of well funded stuff in their youth, affordable housing from the efforts of the post-war generations , decent pension schemes etc, but many of these things not being handed down in the same way. Now there will also be debt that others will pay, to preserve lifestyles now.

by Independent_Observer | 3rd May 20, 12:52pm 1588467128

First wold issue eh Lapun....2nd debt free house!

When people talk about owning multiple properties, the only thing that comes to my mind is 'how many houses do people need to be happy?'.

Clearly its more than 1 even if younger generations can't afford them.

by Mark Hubbard 1965 | 3rd May 20, 1:27pm 1588469236

Now try actually contributing to the conversation. I’m in the last 1/3 of my life, probably Lapun is similarly. Spent well over a quarter of a century on 60 and 70 hour weeks. Didn’t have children. Didn’t spend frivolously. Went hard. Spent way too much of my life sitting exams across three degrees. Saved.

So instead of getting on with your life - and this envy bullshit will hold you back - you choose to beat us over the head with our lives. And that’s your first instinct.

Go to hell, son. All other contributions in the vein I originally wrote, welcome.

by Independent_Observer | 3rd May 20, 1:35pm 1588469708

Whats wrong with being debt free with one house and letting the next generation have a shot?

All the best Mark, had no intention to offend you with my post but clearly hit a nerve - will go to hell now if that makes you happy.

Assume you paid for all your uni tuition - or guess that if in the last 1/3 of your life most of it was free (or near free)?

Do you own rentals or something? And I think you confuse envy with a general sense of concern/empathy for future generations who may suffer financially as a result of the greed/mismanagement of the generations before them.

by Mark Hubbard 1965 | 3rd May 20, 1:35pm 1588469713

Capital is not fixed. Me making a dollar doesn’t stop you making a dollar. Me having a house doesn’t affect you buying a house.

... my last two degrees I paid for while working full time. First was free compared to today, although I worked part time through it. I spent none of my time in comments.

Forget my life. Forget whinging on here. Go and make opportunities for yourself, because you won’t find them in comments. Sorry if I pivot from time to time against comments like yours but they make me angry as they force me to recognise the reality of the collectivist hell-hole we’re all heading to, thanks to generations of cynical politicians offering a free lunch on the taxpayers back.

I’ve paid a lot of tax.

by Independent_Observer | 3rd May 20, 1:54pm 1588470856

I've paid a lot of tax - haven't we all. How about all those landlords who were buying up multiple properties and negative gearing? Bet they've paid a lot.

We need to fix the issues that have got us into this situation Mark - and housing speculation by property investors and landlords is one of the reasons we are.

All the best - never intend to offend but the head in the sand attitude isn't going to work well in the long run - hence here we find ourselves. The way I look at it, previous generations have voted for this outcome for the past 20-30 years, younger generations haven't had a chance to have their say yet (and if they do the older generation tell them to go to hell because it means their property portfolio might lose value!) - yet its the older generation have put them on a trajectory towards hell as you put it. So yes were going to hell because of the decisions that your generation have made. Care to take responsibility for that or do you miss the hypocrisy of the whole situation?

by Mark Hubbard 1965 | 3rd May 20, 1:58pm 1588471100

It’s not the older generation. Nothing landed in our laps. And the generation before me it was harder; my parents were poor and had very little.

If you’ve paid a lot of tax you’ve had a lot of income so there was nothing stopping you mortgaging to your eyeballs to buy rentals, yes. Although if you’d asked me I’d say don’t do it: residential rentals are a fools game: that was definitely not the point of my first post.

What is actually stopping you getting on? Not lack of income re your tax comment.

by Independent_Observer | 3rd May 20, 1:59pm 1588471193

Nothing is stopping me getting on - you just made that up in your own mind without knowing anything about me!

All the best Mark.

by Mark Hubbard 1965 | 3rd May 20, 2:00pm 1588471242

Then what are you complaining about?!

by Independent_Observer | 3rd May 20, 2:54pm 1588474483

See all the points above Mark.

I'm over this thread of conversation, including the 'go to hell part'.

All the best.

by Mark Hubbard 1965 | 3rd May 20, 5:00pm 1588482019

Comments on here is an asylum a lot of the time.

by Speechless | 3rd May 20, 5:29pm 1588483777

I thought you ragequit Interest.co because Millenials were pointing out the empirical data shows the exact opposite of what you think? Go comment on Propertytalk or something if you want a delusional Boomer confirmation bias echo chamber.

by GV 27 | 4th May 20, 7:12am 1588533168

That would involve acknowledging it has nothing to do with the number of hours you worked and more being in the right place at the right time. I don't blame people for finding that hard to understand or accept, given that most will have put in some pretty huge hours over the years to build up businesses.

Usually it will take their seeing their kids or grandkids, who are working just as hard, barely treading water after paying down student debt and trying to keep up with house prices or deposit requirements on wages that barely keep up with inflation, in a world where paid overtime has long since disappeared and so has redundancy provisions for white collar workers. At that point, they might start to see what we're all dealing with.

Good things take time.

by Hans Brink | 4th May 20, 1:55pm 1588557338

Life is always hardwork and disapointment but stick at it and rewards will come. Secret is dont give up.

by Speechless | 3rd May 20, 5:52pm 1588485170

"Me having a house doesn’t affect you buying a house."

I'm guessing those degrees are in Art History...

by Independent_Observer | 3rd May 20, 5:59pm 1588485584

Its a bit like the argument landlords make, not realising they're adding demand to a limited supply of properties, pushing equilibrium and price points up.

If they could only rent out new builds (adding to the actual supply of houses demanded), I'd agree with their argument. But they don't, they've been competing with FHB's.

by Speechless | 3rd May 20, 6:10pm 1588486239

Saying they don't realise is giving them way too much credit (pardon the pun). They make the argument in public so they can sleep better at night, but then you see them at an open home and they immediately break eye contact and look at the floor. They know.

by Kate | 3rd May 20, 7:35pm 1588491354

What a great idea. Business regulation that requires any new residential tenancy business not yet written to be established using new build properties only.

I'll have to think about that more. Do you know of any country who has such regulation in place?

by Independent_Observer | 3rd May 20, 9:06pm 1588496779

Not that I'm aware of Kate - but if we thought a capital gains tax was unpalatable politically, this idea would be worse again (based on my experience of dropping this idea in the mix over a coffee with the people I know - some investors, some not). But it would have solved the issue 5 years ago and prevented a number of the issues we now have. The horse may have bolted and now found itself lame so not sure if its relevant any longer.

Basically kiwibuild would be run by the landlords themselves, which is an idea I find rather appealing given their criticisms of kiwibuild (or kiwiflop as they seem to call it) - mostly because they don't want it to work as each new home built adds to supply of houses which destroys the supply/demand equation which has been working in their favour. It's odd right - have you noticed that the most critical people of kiwibuild are the landlords themselves, as they want it to fail? Its not FHB criticising it.

by Kate | 3rd May 20, 9:51pm 1588499491

I'll do some more thinking and eventually pen something to the appropriate Ministers.

Thing is, you're thinking it might be too late (i.e., if done 5 years ago it might have solved today's problems) but I recall our eldest son looking to buy his first home back in 2003, and he and his partner as FHBs couldn't compete with landlords buying up all the entry level priced property. They had to stretch their budget beyond what they felt comfortable with just to get ahead (in price) of the LL class.

That kind of debt commitment puts a real strain on young relationships.

Anything that prevents that happening in future would be great.

by Houseworks | 3rd May 20, 11:17pm 1588504638

Existing tenants would never move out of their rental as the chances of securing another would be almost nil it seems. Given that landlords already buy new properties as investments and that supplies a portion of the market, then how will the balance of the rental market be supplied... are you proposing that landlords buy all of the new builds?

by powerdownkiwi | 3rd May 20, 5:54pm 1588485258

MH - oh, yes it does.

This is not a finite planet, nor a finite country. If you have a house on a quarter-acre, nobody else can have a house on that quarter acre. Same goes for a tree - no other can take the canopy space.

The problem was that more and more of you sprawled over more and more of the landscape. You consumed more and more of the external acreage (food, mining, forest'removal). And you consumed the best, first. You'll never be taken to Court over it, but the generation after next, say, are going to be extremely pissed-off. They have been handed the pollution (I'm guessing Climate isn't on your hymn-sheet?) and the dregs.

by Homer | 3rd May 20, 6:21pm 1588486862

Jeewizz, there are some toxic commentators on this site. I don’t get it that we have to put someone else down to look great ourselves. Surely we have the right to each live our lives as we see fit, accepting that we first do no harm. This vitriol is amazing.

In Cambodia, the Khmer Rouge were so successful at laying the blame on earlier generations that children actually bludgeoned their parents and family members to death in retribution for inequality, as described by those in power.

Let’s see if we can fine some element of compassion for the contrary view even if it’s one we can’t agree with.

There is too much at stake for us all right now to divide into factions !!

From a Wikipedia
Life under the Khmer Rouge
In power, the Khmer Rouge carried out a radical program that included isolating the country from all foreign influences, closing schools, hospitals and some factories, abolishing banking, finance and currency, and collectivising agriculture. Khmer Rouge theorists, who developed the ideas of Hou Yuon and Khieu Samphan, believed that an initial period of self-imposed economic isolation and national self-sufficiency would stimulate the rebirth of the crafts as well as the rebirth of the country's latent industrial capability.

by Speechless | 3rd May 20, 6:42pm 1588488165

We all need to stop fighting and come together! Don't divide into factions guys!

*immediately compares people with opposing political views to Pol Pot*

by ham n eggs | 4th May 20, 10:32am 1588545134

"Let’s see if we can fine some element of compassion for the contrary view..."

trouble is, theres contrary … and theres plain ignorance

by Te Kooti | 3rd May 20, 9:33pm 1588498415

I just watched "Planet of the Humans", what little respect I had for the renewable/green lobby has evaporated. It's a total hoax.

by Speechless | 3rd May 20, 9:55pm 1588499721

Thought you were smart before today. Get your science from scientists not human clickbait.

by Te Kooti | 4th May 20, 9:14am 1588540473

What part of the movie is clickbait? Have you ever been involved in academia, where do you think scientists get their funding from and how many research grants, scholarships, internships, tenures and lecturing rolls do you think there are for those "scientists" who speak their mind? Everyday employees say what they are told, not what they really think, scientist are no different.

by Lapun | 3rd May 20, 1:32pm 1588469537

IO I am very lucky. Never intended or expected to be a millionaire owning two houses (OK the bank owns a share of one of them) but the two houses are inhabited by my wife and I, three daughters in their thirties with two partners and 3 grandchildren and also we have a son in his early twenties. I would much prefer to be like my parents - one house with four children each with famly in their own house. If the average Auckland house cost $200k my wealth would be trivial but the family would befar better off.

by Lapun | 3rd May 20, 1:35pm 1588469711

PS that 2nd property was bought from an inheritance when my Dad died a decade ago. I would rather be less one house and plus one Dad.

by Independent_Observer | 3rd May 20, 1:38pm 1588469888

Yes - I know a few people in such circumstances (see other reply).

by Independent_Observer | 3rd May 20, 1:37pm 1588469852

Nothing personal Lapun - understand the complexities of the situation we find ourselves in.

It does make me angry when I see people buying 5,10,15 properties. The greed is terrible and is making it pretty tough for the like of your children to get into the market (without the risk of it destroying them financially over the term of the mortgage).

All the best.

by THE MAN 2 | 3rd May 20, 6:23pm 1588487030

IO, We own quite a few more than your high that you mention of 15, and why shouldn’t we own what we want to own?
It is our business what we own as we are providing accommodation for those that don’t wish to own!
You have rocks in your head if you think that we have stopped anyone from buying a home for their occupation.
We buy property at under true market value, and guarantee not once have we paid too much for any.
In ChCh if you want to own a home the. You can if you want to.
Get totally sick of people saying that investors make house prices too expensive when it is the owner occupiers that force prices up as they use their heart rather than their heads.
When you can buy property less than what your rent is, then you can’t say that buying a home is too expensive.

by Speechless | 3rd May 20, 6:34pm 1588487694

"It is our business what we own as we are providing accommodation for those that don’t wish to own!"

You're depriving those who do wish to own of the opportunity to own. Try to gaslight us until you're blue in the face, but we're not going to let you forget it. When the reckoning comes remember you brought this on yourself.

by Te Kooti | 3rd May 20, 9:25pm 1588497940

WTF is the reckoning, like running out of avocado? Also, WTF is gaslighting, is that some bullsh1+ millennial term like micro-aggression?

by Speechless | 3rd May 20, 9:53pm 1588499632

Google is your friend.

by ShoreThing | 4th May 20, 9:25am 1588541151

Quite the opposite. The term got it's name from the 1944 film Gaslight.

by RickStrauss | 3rd May 20, 6:35pm 1588487746

There's really no reason that taxpayers should be subsidising rental properties then, nor should they be dealt the negative blows of a Reserve Bank propping up property prices and a finance minister (English) refusing them a DTI tool to prevent economic stimulus flowing straight into assets. The amount of central support property has had really highlights how it's dreamy to think one has done it all on one's own two feet.

by Houseworks | 3rd May 20, 11:23pm 1588504985

As I have always said, stop paying the accommodation supplement AND stop providing state houses. You cant have one without the other.

by Pragmatist | 4th May 20, 12:27am 1588508874

why on earth not?

by RickStrauss | 5th May 20, 1:40pm 1588642847

So that would imply there needs to be some recapture of the profits that folk made from buying cheap supply fostered by government efforts then selling that on for capital gains. Can't have state housing, apparently, thus can't have folk profiting off that either.

by Speechless | 3rd May 20, 5:44pm 1588484675

"If the average Auckland house cost $200k my wealth would be trivial but the family would befar better off."

In theory if the banks had served their proper function and lent on productive enterprises instead of houses you would actually be better off too because your savings would have ended up in successful businesses instead. We could have had $200k houses *and* rich Boomers. Instead we got a Ponzi scheme that will leave the whole country poorer.

by Independent_Observer | 3rd May 20, 6:03pm 1588485804

And if our money supply wasn't flowing into property debt, we might actually have some inflation in the system (that gets measured....not just the basket) and higher interest rates to encourage boomers saving. Imagine TD's with 5-7% return. How nice would that be right now for the comfort during retirement?

Instead its encourage property speculation, push interest rates down so we can service the debt, because we can't figure out whether the inflation has gone - well its in our house prices.

by Houseworks | 3rd May 20, 11:30pm 1588505420

You guys always make statements that business cant flourish because they arent supported by the banks the same way as what the property sector is. However a business with collateral can obtain funding so what you say is bs. None of this stopped the likes of a2 or xero getting off the ground to name but two. And if I remember rightly The Warehouse and Michael Hill jewellery were started by entrepreneurs with vision and passion, not oodles of cash.

by Pragmatist | 4th May 20, 12:31am 1588509091

What is Basel I, II, III & IV.
What are Risk Weighted Assets,
What is Common Equity Tier 1,
and what do these mean about the banks lending to businesses vs residential real estate.

by Sluggy | 4th May 20, 6:41am 1588531279

You ever tried to borrow money against stock ? I've got over 1m of unencumbered stock, took me 2 years to get a bank to loan against it.
If I owned a house .... no problem.

by Houseworks | 4th May 20, 7:51am 1588535501

Stock? Stock! We are talking about financing business not bloody risky stocks where values yoyo up and down.. Example fresh in our memories: covid crisis 2020. Go back to late 2018: massive crash. Btw if you pick the wrong stocks your 1m will vanish never to be seen again

by Sluggy | 4th May 20, 9:53am 1588542795

Stock as in sitting on my shelf in my warehouse, stuff people buy. Im really not that stupid.

Houses ! Houses ! We are talking about financing business not bloody risky houses where values yoyo up and down.

by Houseworks | 4th May 20, 10:28am 1588544930

Using a non ambiguous term like inventory solves the problem. I'm not in the game but... I had heard there are ways to finance inventory with a general net type loan. The companies I have worked for easily got the finance they needed through trading banks at attractive rates.

by Kate | 3rd May 20, 7:50pm 1588492241

Yes, boomers who are asset rich but cash poor. And the children are renting. How could successive governments have been so stupid and/or selfish as to have got us here.

by Speechless | 3rd May 20, 9:07pm 1588496850

And soon to be asset poor too by the looks of it. That's the real Greek tragedy element to me: in the end they're going to lose a lot of the "wealth" they screwed us over for because it was never real. And they will say "we never could have seen this coming." But tail risks are always coming.

The sad part is, the governments who got us here have actually been pretty representative of the will of the people. The public voted for chronic short termism and systemic malinvestment. Key got three terms when it was super obvious what he was doing. You only need to look at the psychology of the likes of Yvil, The Man etc to understand it: it walks like a duck and quacks like a duck but I'm making money from it so here are 20 reasons it's not a duck. We had our chance to course correct after the GFC but after Key got re-elected a third time I sat back and accepted NZ was going to have to learn the hard way.

by Independent_Observer | 3rd May 20, 9:28pm 1588498090

Ray Dalio (not sure if you follow him) commented on that recently. Basically saying political leaders aren't good for the economy as they only care about what is good for them to stay in power and that concern is usually limited to a time period of 3-4 years depending upon the country you live in.

Its the wolf in sheeps clothing with everything real estate that gets me. 'I'm a landlord, here providing a service to society, helping people out etc'. BS. most have been in it for the tax free store of wealth and capital gains - then voting for whatever party would best support their selfish interests.

In about 2012 when it looked as though property was starting to get away again we needed a capital gains tax, foreign buyer ban and DTI limits on lending against residential property. But as you say, peoples short term interests won out politically. We've made our bed, so now we need to sleep in it.

by Speechless | 3rd May 20, 10:51pm 1588503085

Yep big fan of Ray Dalio. It's been interesting watching him through this thing and trying to read between the lines a bit on his motivations. I know he has the whole Greco-Roman 'last phase of life time to give back my knowledge' schtick, but I don't know... he's a hedge fund guy. He hedges. What's he hedging? Last interview I watched he was really dancing around the questions a lot but seemed almost like he thinks some sort of revolution in the US is a credible outcome. Seems to also be dropping hints that the US has had its day and it's all China from here. I don't agree with that take but I guess we'll see.

But yeah, to your point: yep, all the 'I'm providing a service' BS from landlords is ex post rationalisation for what they want to do anyway.

To be fair I'm not sure to what extent NZ could have really stopped the debt wave, it's a little beachball on a big ocean, but yes there was lots of voting to pour fuel on the fire and shooting down attempts to put it out. It's a lot worse than it needed to be.

by Kate | 3rd May 20, 11:13pm 1588504428

Can't see 'revolution' as the word to describe what might happen in the US (revolution to my mind implies the proletariat rise up) - anarchy, possibly (given the proletariat are well small-armed, but they won't all be on the 'same' side, so to speak - hence only chaos can result).

If anarchy emerges, it will be followed swiftly by a state of marshall law, then perhaps followed by a military coup? What a world, eh?

by Speechless | 3rd May 20, 11:40pm 1588506038

Anarchy might be a better description. But yes I see that whole Washington/CIA/military-industrial apparatus being so entrenched and having so much power relative to 'normal people' that I don't see how it could end well for any sort of 'uprising.' Emergence of a third political party, maybe? Who knows. If I were a betting man though I'd bet on China imploding from the inside long before the US. I always took the accusations of fake data with a grain of salt but after seeing the virus stats it's plain as day. I think all their numbers are fake and they're puffing out their chests to hide how fragile they actually are. 'Fake it 'til you make it,' and it was working well too but they will be in trouble once the consumer backlash really kicks in.

by Independent_Observer | 3rd May 20, 9:18pm 1588497519

I'm left wondering if rates are forced to stay low so that debt can be serviced, yields on usually safe investments for retirees could stay low for quite a while (as long as we don't see run away inflation). Just wondering how long before boomers need to start selling down assets to generate cash to live from. Would be an interesting statistic to see how many in the 60+ age group own more than one property (and how much debt is still owed to those titles).

by Kate | 3rd May 20, 10:29pm 1588501755

It would be good if the RB could provide data on total mortgage debt by age of mortgagee. My concern is, if we have a real crisis, say 50% drop in market valuations, it might be a younger-than-boomer cohort that will be most affected.

Many in the 60+ age range started their LL portfolios when in their 30s (1990s). It was the time of the first wave of state house sell downs and a lot of young professionals decided to become LLs to the state at the time - buying the ex-state houses from the govt and renting them back to the govt under contract as social housing providers;

https://en.wikipedia.org/wiki/Mother_of_all_Budgets

by Speechless | 3rd May 20, 11:10pm 1588504239

It will definitely be the recent Millenial purchasers who get cleaned out first, which is the main reason I'm on here spitting bile at spruikers. That's also why I think in 5-15 years they are going to be in for a political hiding. The pain will fall disproportionately on people who didn't create the problem. If we get that big of a drop, strap in for social unrest that makes the Springbok tour look like a Hare Krishna drum circle.

by Kate | 3rd May 20, 11:17pm 1588504658

Nothing stopping the govt from rescuing any owner occupiers facing foreclosure, and leaving the rest of the market to market forces.

It's amazing what you can do in government where there is a will.

by Speechless | 3rd May 20, 11:42pm 1588506125

Yes, hopefully that is the ultimate outcome.

by GV 27 | 4th May 20, 9:53am 1588542796

If they wanted to do it, there's nothing stopping them doing it now. They have a state owned bank. They could create a mortgage product for soon-to-be FHBs and people still living in their first homes, allowing them to insure a portion of equity against a future price drop. The very act of offering this as a product would be a major corrective force in the market, but it has to come with a wave of other measures to ensure we never end up in this situation again, like stamp duties that abate or multiply if needed, and removing interest deductions for investors.

If people think the boomers are entitled, wait until the dominant cohort is the same millennials that have been made the fall guys for the sake of preserving lifestyles for those who came before. Governments won't know what hit them.

by Kate | 3rd May 20, 10:10am 1588457401

Interesting and informative. Thanks.

by JasBurnt | 3rd May 20, 10:16am 1588457784

Still copying and pasting those V shaped bounce back - it won’t even be a desirable U .. it’s heading for the Bath Tub \_____/

by dictator | 3rd May 20, 10:36am 1588458960

I have to agree. Their projections are still too optimistic but they have nothing to compare this to. There's still not enough money flowing through the economy for things to turn out well.

by Fritz | 3rd May 20, 10:59am 1588460396

That looks about right :)
Maybe not as steep a rise at the end...

by blobbles | 3rd May 20, 10:59am 1588460396

Yeah, look at their tourist numbers at the start of 2022 - there will be 2 million! I can't see us getting there for 5 years or more, the depression that will come about as a result of this will ruin potential tourists disposable income.

by wirehunt | 3rd May 20, 9:48pm 1588499322

The country was shit with tourists never mind 2 million of them.

by b21 | 3rd May 20, 11:51am 1588463504

Agree, everyone advocating for the so called V shaped recovery either doesn't know how people think or behave (there will be uncertainty and when that happens people are reluctant to spend) or they are just trying to save their own asses in the stock market due to another, probably even more sustained crash.

by bloodymigrant | 3rd May 20, 1:18pm 1588468697

Agreed,

by Speechless | 3rd May 20, 6:14pm 1588486499

I like Nouriel Roubini's summary... to paraphrase: It's not a V shape, it's not a U shape, it's not even an L shape, it's an I.

by Belle | 4th May 20, 12:14am 1588508044

Hell an I, thats really not a good graph.

by Tillers | 3rd May 20, 10:32am 1588458775

Its ok watching Bindi on the news last week the housing market fundamentals are still strong and once we move into Level 2 we will see house prices steady and then rise after the election

by Justa comment | 3rd May 20, 11:03am 1588460630

yes lol

by b21 | 3rd May 20, 11:52am 1588463556

Double LOL, stop believing what the lobby says!

by fat pat | 3rd May 20, 10:38am 1588459108

According to this MBIE report 2018 tourism was worth 16.2 billion NZD or 20.6% of total exports. According to the observatory of Economic complexity NZ's highest export earner in 2017 was milk solids at 5.34 billion USD out of a total of 37.3 billion USD, or 14.3% of total. Hard to compare different sources in different years but I think it's fair to say tourism makes a pretty huge contribution to the economy. Given that we'll probably be importing COVID19 as soon as international flights resume. What's the endgame. It's not really feasible to expect tourists to quarantine for 2 weeks

by dictator | 3rd May 20, 10:42am 1588459368

We could have no foreign tourists for 2 years in the worst case scenario. The best case is an effective treatment that dramatically reduces fatalities and a vaccine. Both take time to test, approve and then mass produce (typically years, ignore false claims by journalists and claims of miracle cures).

by Miguel | 3rd May 20, 11:45am 1588463118

Best case scenario is renewed tourism between countries that have effectively "eliminated" community transmission. It's feasible that Tourism could resume between Australia, New Zealand and possibly China in the not too distant future.

by Belle | 4th May 20, 12:18am 1588508292

China. CHINA. What planet do you come from Miguel? The communists never lie about nothing least of all a virus planet?

by Tombo77 | 5th May 20, 2:26pm 1588645588

China and soon in the same sentence ? You really have taken leave of your senses

by Pragmatist | 3rd May 20, 10:45am 1588459515

External tourism is dead and buried, might rise from the grave in late 2021 if things go well with treatment/vaccine options.

by Independent_Observer | 3rd May 20, 10:54am 1588460091

And who knows what is going to happen to international travel costs now.

by Pragmatist | 3rd May 20, 12:12pm 1588464750

Fuel is cheap(for now), and the market is going to be flooded with excess aircraft as airline after airline downsizes/collapses, and ground crew etc also going to be in the Labour market. If anybody jumps into the airline business they should be able to set up an airline with much lower baseline costs than the legacy carriers. BUT first you need to raise the capital and get the backing, and who the heck is going to invest in airlines now.

by Independent_Observer | 3rd May 20, 12:56pm 1588467418

While there are risks of further outbreaks and world/country lockdowns I just don't see how airlines could operate with small margins (low pricing). In my opinion, it will mean quite expensive travel for the next few years.

by Kate | 3rd May 20, 10:30pm 1588501847

for the next forever is my guess.

by Speechless | 3rd May 20, 11:44pm 1588506260

Fingers crossed. Cheap Instagram narcissism trips are one thing I'm hoping are gone for good.

by fat pat | 3rd May 20, 8:16pm 1588493808

Cheaper flights? here's a counterargument. Fuel is cheaper, but other costs are increasing. Aircraft maintenance, staff wages, regulatory, taxes, airport surcharges etc. As other airlines go bust, only a handful survive gaining a monopoly. Demand/supply imbalance combined with increased costs pushes up the price of flights. Could make a similar argument to all businesses. That's why I think we're in for high inflation.

by wee willy winkie | 3rd May 20, 8:21pm 1588494083

Read somewhere recently that to service a parked up turbo prop aircraft requires at least twenty hours of specialist labour per week, and a large jet liner significantly more. They eat their heads off even when they are not running!

by blobbles | 3rd May 20, 10:57am 1588460242

Everyone is talking about how "post covid", which could be a year or two away, tourist numbers will dramatically rise, even this BNZ report. But you only go on expensive holidays if you have the money to fund it. If there is a worldwide depression lasting a significant amount of time, tourist numbers may take a decade to get back to where they were before. People simply won't have the disposable income to spend 10k or more on a NZ holiday. Those that do will be a in a very small minority...

by Fritz | 3rd May 20, 11:01am 1588460514

Exactly. If I was being optimistic, I would say we could get 50% of our international tourist numbers back by 2023...

by Independent_Observer | 3rd May 20, 12:58pm 1588467506

Did I read somewhere that 40% of our tourist numbers are from Aus? And if there property market tanks there goes the wealth effect.

by Tombo77 | 5th May 20, 2:29pm 1588645758

"If" it tanks ? It's in freefall as we speak

by bw | 3rd May 20, 11:05am 1588460735

And trust me. Whatever endearing features New Zealand has, so do may other countries closer to home for many travellers.
Every tourist spot on the planet is going to be after whatever disposable dollars and yuan there are, and if it's a choice between skiing at one of 3 short runs in NZ and one of 1,000 L O N G runs in Europe, and the cut-throat prices are similar, then guess where they'll be going? Coronet Peak isn't the answer!

by Fritz | 3rd May 20, 11:20am 1588461640

Great point.
NZ tourism needs to accept the new reality and plan for it.

by Houseworks | 3rd May 20, 4:15pm 1588479329

T H E Y dont have JA, cover girl, young mum, worldwide celeb and PM extraordinaire. A N D She welcomes foreigners at the airport for tv shows

by RickStrauss | 3rd May 20, 6:38pm 1588487921

Amazing how extremely grumpy young women with a bit of power can make old fellas eh. Bellicose outbursts at the most random times.

by Tombo77 | 5th May 20, 2:32pm 1588645970

For skiing Japan has been the been a big benefactor of recent years and will continue to be so so long as their lift pass prices remain close to a third of ours. Ski Holiday is cheaper in Hakuba than Queenstown if you do the maths even considering flights before this meltdown.

by Tombo77 | 5th May 20, 2:45pm 1588646743

by Independent_Observer | 3rd May 20, 10:53am 1588459986

Just me or has capitalism become a self licking ice-cream cone? If the cone starts melting, the central banks just turn the temperature down and make it snow. All good until you reach zero kelvin then everything stops.

We need a system that rewards productivity, not capital (and debt) accumulation.

by Ludwig | 3rd May 20, 11:40am 1588462822

Capitalism has been dying for years now and very little of it is in evidence now. The majority appear to be yearning for bigger govt, more welfare, bureaucracy, less freedom (in return for more welfare), and so it goes on. We’re starting to get that in spades now. As for productivity, that has NEVER flourished under any socialist/big govt system. Again, we must get what we deserve...

by Independent_Observer | 3rd May 20, 1:14pm 1588468445

Yes obviously governments aren't productive in an economic sense (that can be a deadweight loss but we need supervision/regulation right?).

I've always enjoyed Ronald Reagans quotes about government:

'Government is not the solution to our problems. Government is the problem'.

'The most terrifying words in the English language are; I'm from the government and I'm here to help'.

'Governments view of the economy could be summed up in a few short phrases. If it moves, tax it. If it keeps moving, regulate it. If it stops moving, subsidise it'.

'Man is not free unless government is limited'.

The odd thing, or perhaps a paradox I see is that many of our right wing friends who post here, and those I have coffee with, appear to benefit the most from government intervention and welfare via legal tax avoidance and subsidies (landlords, property speculators etc). They claim that welfare and socialism are evil, yet it is what has made them wealthy. Quite bizarre really.

by redcows1 | 3rd May 20, 7:45pm 1588491943

"If it stops moving subsidise it"
Since covid the screams for this from business has been deafening. At least with this gvmt they have been just as inclined to loans bar the wage payments.

by childofthesun | 3rd May 20, 10:51am 1588459870

Must be the most sensible projection from any of the banks to date. While they've revised their doubtful debt provisioning which looks conservative, it's still painful and may be just the start.
At some stage, we (the taxpayer) have to pay for the necessary short term government generosity. I for one will be happy whatever the price as I feel incredibly lucky and privileged to be living in NZ when I compare the mess elsewhere.
Surprised BNZ didn't include primary industries in their list of potential winners. For some, of course, winning is not enough. This is FRAUD - https://www.stuff.co.nz/business/farming/agribusiness/300000656/kiwifru…

by Jethro | 3rd May 20, 12:20pm 1588465251

Agree with the child of the sun’s comment that primary food production is an additional candidate for the winner slide and NZ is one of the better bomb shelters in any event.
The confounding thing for me in such analysis is the elastic NZ$ measuring stick especially when it’s raining Government funding promises. Maybe the MacDonalds Burger index will help now we are at level 3.

by Henry_Tull | 3rd May 20, 12:33pm 1588465993

Hows the well being index looking.

by Kate | 3rd May 20, 10:32pm 1588501948

Better than GDP.

by Tillers | 3rd May 20, 11:04am 1588460677

Both Aus and NZ have been running a high immigration programme to drive up Demand for goods and housing and of course GDP. That’s all good when unemployment is tracking sub 5%. I think what economists are missing is how do you continue to run the same level of immigration when unemployment is over 10% and still be politically electable? I think NZF will start banging the drum on this heading into Q3.

by Lapun | 3rd May 20, 12:24pm 1588465492

Rather easy to have immigration and unemployment over 10% - just insist all non-citizens who work are paid over $100k pa. It is only low paid immigration that the public finds objectionable.

by Henry_Tull | 3rd May 20, 12:30pm 1588465833

That's been the trick as per capita GDP has not done much.
https://www.ceicdata.com/en/indicator/new-zealand/gdp-per-capita/amp

by Independent_Observer | 3rd May 20, 1:15pm 1588468540

I think we could be stuck in a liquidity trap until we can some how generate aggregate demand again. But that could be years away.

by Carlos67 | 3rd May 20, 1:18pm 1588468704

Funny how everyone has to be optimistic about the recovery because trying to state the reality of the situation would be pessimistic and everyone hates to be called negative. There are certainly some big international players that can try and "Talk up the market" but not in NZ.

by Independent_Observer | 3rd May 20, 1:30pm 1588469430

Bit like if you say you think we have a housing bubble in NZ, you get told you have a 'bad attitude'. Having lived overseas a bit, you come to realise we have a strange type of narcissism going on in NZ we were actually think we're different to everyone else with special rules (including for things like economics!)

by Somebloke | 3rd May 20, 3:28pm 1588476500

This has been a bubble, a very big bubble..in fact, if you have time, this a 2000 feet tall purple neon lit bubble in a spangly spandex bubble costume bubble singing ' this has been a bubble' with iron maidens sound system hooked up to a nuclear reactor. Whether this turns out be the unravelling of it remains to he seen, but people who create their own opportunities from scratch instead of hopping on board the bubbliest investment fad of the last 20 years have nothing to fear.

by CN | 3rd May 20, 5:11pm 1588482697

How did residential property prices in Auckland reach current price and valuation levels?
The really interesting observation is the psychology, & confidence of the public that fuelled the property price rises in Auckland to current price levels.
1) remember in 2016, news reports of the fierce bidding competitions at property auctions? Remember how confident buyers were and how pleased that the buyers had successfully purchased the property, whilst there was disappointment by those who lost out in the auction as their bid was topped by another bidder? Property price momentum was upward, and there was a fear of missing out by property investors & owner occupiers and expectations of future property prices in Auckland were of higher and higher prices. Property was a very common discussion topic in many households in Auckland. It is interesting to note the many justifications / rationalizations provided as to why house prices in Auckland were going to continue to rise. Also interesting that property price warnings by informed insiders such as David Hisco, Don Brash, & Arthur Grimes were ignored, as well as comparisons of the elevated Auckland property price levels compared to other markets internationally and other historical property price bubbles. That was when it was a seller's market.
2) if property prices in Auckland fall significantly, it will be interesting to watch how sentiment of the public in Auckland changes again. If you want some history as a guide, then look to the Auckland property market in 2008/2009 where there was unemployment rising, fear of job losses, and mortgagee sales. At that time there were stories in the media of financial difficulties being experienced by households. If the property price fall is significant, the mood and confidence of households in Auckland will likely be worse than experienced in 2008/2009.

by Independent_Observer | 3rd May 20, 5:23pm 1588483384

Anyone else read Robert Shillers books? Irrational Exuberance and Animal Spirits are great reads if you want to understand bubble psychology and yes we have definitely had it here. I attended quite a few auctions in Auckland around 2015-2017. It was absolutely insane. All appeared to be running on emotion.

by Speechless | 3rd May 20, 6:26pm 1588487174

You can gauge it by what percentage of overheard conversations in cafes or passing people on the street are about buying property.

When I last lived in Auckland I'd say a good 80% of random snippets of convo I heard while out and about were property related in some way.

by Somebloke | 3rd May 20, 7:52pm 1588492345

I made an enquiry on a property i was vaguely interested in at the weekend (I happened to see a sign from the road). A 4 bedroom house in an edge of town location. The agent told me with a straight face that the owners were looking for 3 million for it. I was laughing as I hung up on them, and Im still laughing now as I type this. I sometimes wonder if Im perhaps the only insane one, while Im looking out at all the insane people.. then I look at the almost infinite number of investments that 3M or even 1m can be appropriately invested in, globally and in NZ, and I thank God for my sanity.

by Speechless | 3rd May 20, 9:22pm 1588497747

Yep haha, I look at the new listings on Trademe and wonder... are they starting to feel a bit sheepish when they put the price on there? Is the slow sinking feeling starting to set in as they realise the numbers are absurd?

But to this day there are posters on here who swear prices double every 10 years. Some won't admit the Titanic is sinking until it touches the seabed.

by Independent_Observer | 3rd May 20, 9:34pm 1588498461

On the Titanic the captain goes down with the ship. In this instance John Key just sells another property making a few more million while now working for the company that manufactured the faulty ship.

by Speechless | 3rd May 20, 10:16pm 1588500983

Haha. In the Key version of the story the Titanic has a helipad, Key gets choppered out just before collision with the iceberg and calls his broker from the ride home to short the ship owner's stock before the news breaks while Max takes a shirtless selfie with the ship in the background.

by Belle | 4th May 20, 12:25am 1588508736

Brilliant

by gingerninja | 4th May 20, 9:33am 1588541596

I would buy you a beer for that comment Speechless.

by Dale Smith | 4th May 20, 1:55pm 1588557326

Life imitates art,

for when the movie about this all comes out: https://tvtropes.org/pmwiki/pmwiki.php/Main/EinsteinSue

by bw | 3rd May 20, 2:51pm 1588474305

4 years after Berkshire took major stakes in the four largest US airlines, (Buffett) had liquidated the entirety of its equity position in the U.S. airline industry which included $6.5 billion worth of stock in United, American, Southwest and Delta Airlines.
Assuring that Monday will be a bloodbath....

https://www.zerohedge.com/markets/brace-monday-massacre-buffett-liquida…

by Kate | 3rd May 20, 10:44pm 1588502647

Great summary. Gotta love the game!

by Carlos67 | 4th May 20, 12:57am 1588510662

Wow all eyes on the Stockmarkets Monday.

by stuart786786 | 3rd May 20, 3:49pm 1588477761

Being forewarned is forearmed.

FHB be warned.

by Independent_Observer | 3rd May 20, 4:07pm 1588478872

Anyone else find slide 31 interesting? If we're like Australia and the US, then the flat line you see at the start of the real house price series is a flat line, all the way back to 1890'ish.

https://support.sas.com/rnd/datavisualization/yourGraphs/analyticalCust…

House prices from there, for NZ and Australia are just negatively correlated to interest rates. Last 10 years, no real inflation to speak of with interest rates racing to zero.

What we've seen from about 2000 to now is a massive deviation from the historic, near zero, real return on property.

by RickStrauss | 3rd May 20, 6:41pm 1588488081

Young Kiwis and Aussies could do without this central sponsorship of house prices. Self absorbed governance from MPs and bankers, at the expense of younger generations who they expect to fund their retirement too.

by Speechless | 3rd May 20, 9:40pm 1588498842

"who they expect to fund their retirement too."

Yes, delusionally I might add. That tab is not going to be picked up. I don't understand why Boomers think we are just going to rent from them til we're 45 *and* pay for their super. They have all been patting themselves on the back for flexing their political muscle to stack the deck in their favour, but they seem to forget that they are a shrinking component of society while the generations below mine are even more screwed and even more militant about it. Once Gen Z start getting seriously involved in politics the Boomer rorts are done. It's not that far away.

by Fritz | 3rd May 20, 5:11pm 1588482712

From a quick look at Trademe, advertised rents in Auckland seem to be in la-la land. Many of those will need to come down at least 10-15% to be tenanted.
I've made a note of a few to see to what extent if any the advertised price might reduce in the coming week.

by ShoreThing | 4th May 20, 9:46am 1588542380

Start texting agents asking if they'll consider a price of 15% - 20% less than advertised.

by RickStrauss | 5th May 20, 1:43pm 1588643000

Ah, the Reverse Ronovation.

by Fritz | 3rd May 20, 5:28pm 1588483681

just went to New World and now they have friggin one way arrows on aisles, with nazi-like staff telling you to obey.
Well, I'm ready to disobey.
this is sinister.

by Carlos67 | 3rd May 20, 5:49pm 1588484942

Not really Fritz unless there is a gas chamber at the end of the isle. Lets keep it sane here thats just common sense to maintain social distancing. There suddenly appears to be a lot of angry people on interest.co.nz

by Fritz | 3rd May 20, 6:03pm 1588485836

nup, over the top. after all, sneezes can move between aisles anyway.
There's no community transmission ,for f%$ks sake.
Enough is enough.

by youngdumbandbroke | 3rd May 20, 6:12pm 1588486334

Didn't you know Fritz? Covid only travels in a clockwise direction so if you travel through NW anticlockwise your immune?

by Alittlebit | 3rd May 20, 9:13pm 1588497213

Lockdown may not have been legal....and now " a more secure legislative footing, saying "no matter how 'necessary' these may be, we should expect such restrictions to have a clear, certain basis in law and be imposed through a transparent and accountable process".
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12…

by wirehunt | 3rd May 20, 10:16pm 1588501012

It works well, we've had it the whole way through. Go the wrong way and you may find a can of beans coming.your way at pace.

by Dale Smith | 4th May 20, 2:11pm 1588558305

Walk backwards down the aisle and they will think you are going rather than coming :-)

by John | 4th May 20, 4:42pm 1588567358

In February when I flew in from Aus, the government believed (by their actions) that coved 19 was a Asian disease as they were the only people given leaflets etc.

by RickStrauss | 3rd May 20, 6:42pm 1588488146

Well, yeah, it's true, it's all actually part of a totalitarian international conspiracy to enslave us all. Good spotting.

by Fritz | 3rd May 20, 6:55pm 1588488924

Nah, but it is a time of great joy for paranoid control freaks

by RickStrauss | 5th May 20, 1:43pm 1588643035

I did nazi that coming.

by redcows1 | 3rd May 20, 7:54pm 1588492472

Bloody good. I've always hated the haphazard way some folk cruise the isles.
There's only my way.

by powerdownkiwi | 3rd May 20, 6:03pm 1588485800

Return to “normal” is years away

And the world will never be the same

And interesting couple of observations to put in sequence. At least cognitive dissonance is alive and well.

by Independent_Observer | 3rd May 20, 6:04pm 1588485893

Yes I read that bit and had another mouthful of coffee.

by mah65 | 3rd May 20, 9:33pm 1588498411

I am new here , just read the presentation. It’s pretty pragmatic, though I could not understand how equities would continue to rise?
Found this blog very interesting
Viewpointmag.com/2020/04/29/irrational-expectations

by Fritz | 3rd May 20, 11:48pm 1588506491

Welcome to the madhouse.

by Pragmatist | 4th May 20, 12:40am 1588509650

As said above, welcome to the madhouse.. now run while you still can.

by mikekirk29 | 4th May 20, 9:28am 1588541299

Housing: "long term over-supply"
Finally reality is setting in.
Excess supply means? Lower prices QED

by Dale Smith | 4th May 20, 2:15pm 1588558546

Yes agree, but the Govt. are going to invest taxpayers money into building lots of affordable housing and then more to subsidize people into them.

by Ralph | 4th May 20, 2:46pm 1588560367

If I read that forecast correctly, they say a year with no positive employment growth, just an ever lengthening dole queue.

by Ralph | 4th May 20, 2:54pm 1588560879

The intensity of the intergenerational debate triggered (in these comments) by these forecasts is of quite some concern.

When the economic costs of this debacle really bite a lot of misdirected anger is going to flow forth. Sadly, as the wise know and history shows, anger is not a rational thing.

by RickStrauss | 5th May 20, 1:45pm 1588643110

In which case the government would be wise to take ACT founder and former Labour MP Roger Douglas's advice and put some effort into building affordable housing supply.