Here's our summary of key economic events over the weekend that affect New Zealand, with news 'health' policies are very much secondary to 'economic' policies.
Around the world, governments are starting to plan re-openings of their economies. And this is despite a clear lack of control of the pandemic. Many countries are at vastly different stages in their fight for control but the drive to restart business is growing everywhere. The scientific advice is being pushed to the background and it is now clear that choices are being actively made to sacrifice lives for "jobs" and "profits". "The economy" trumps all.
In the US the pressure is enormous. More than 20 mln people lost their jobs there in April, according to their official data.
At the same time, another 2 mln people lost their jobs in April in Canada. Between the two, that is 22.5 mln extra people jobless in just one month. We want to try and put that into perspective. That is like saying everyone in the workforce in New Zealand (2.8 mln), Australia (13.0 mln), Singapore (3.8 mln), and Hong Kong (3.9 mln) all lost their jobs in one five week period.
But it is worse than that, much worse. Even the White House says things will get worse. The US data is based on a survey taken on April 12, and things got substantially worse after that. And at the same time, the same survey reveals that the American labour force shrank because a remarkable -6.5 mln adults withdrew from their labour force on top of the -1.6 mln who did the same in March. So in two months 8 mln more people gave up looking for work and these people are no longer counted as being in their workforce, so the unemployment numbers ignore them. Their participation rate fell to almost 60%, the lowest since 1969 more than fifty years ago.
And of course, the jobless numbers don't count those who have had their pay cut, their working hours cut (or both), or are in the casual, gig economy (surveying these workers is difficult). All up it is an epic economic disaster and one that will probably be repeated in May, despite the desperate attempt there to restart their economy. You just cannot take the purchasing power of that many people out of the giant American economy and not have long-term global economic implications. The hurt will spread to New Zealand and our export markets.
And the impact is playing havoc with the US Federal Government finances. The federal budget typically records a surplus in April because of the timing of tax payments. But this year, they incurred a deficit of -US$737 bln in April compared with a surplus of +US$160 bln last year in the same month. Remember, it was just a few weeks ago, estimates were being made that the full year deficit could exceed -US$1 tln. Well, they got close in April by itself. The revised estimates are now closing in on -US$4 tln.
There is also a heap of hurt being reported elsewhere around the world for April. For example, Brazilian car production fell -99% (!), Mexico's car production fell by almost the same, Israel's factory sector dived, and industrial production in Spain, Germany and Norway all fell very sharply. The global economic carnage is widespread.
But not everything was disastrous. Canada's housing starts fell sharply, but not by as much as feared. And Canada's building permit levels were also down sharply, but not to levels feared. (But there may be questions now about whether any of these projects will be started soon.)
And in Europe over the weekend, finance ministers accepted a plan for a €240 bln credit extension on very cheap terms, allowing under-pressure governments to access huge amounts of new borrowed money.
And in China, there is more evidence that a return to normal life is bringing an economic upswing. But being the only game in town also means that China is pressing its advantages for access to that rebound. It is pretty callous in how it is doing that. It cares little for its neighbours.
And deteriorating relations have resulted in China giving Australia 10 days to explain why Beijing should not impose tariffs of 80% on Aussie barley, a AU$600 mln trade. Canberra is not impressed.
Meanwhile, even though iron ore prices keep on rising, the price of both thermal and coking coal continues its downward direction, down more than -10% over the past few weeks and threatening to shut mines in the same way oil rigs are shutting.
The latest compilation of Covid-19 data is here. The global tally is now 4,077,600 and up +167,000 from this time yesterday which is sustained level of increase.
Now, just under 33% of all cases globally are in the US, which is up +46,000 since this time yesterday to 1,320,400. This is a marginally slower rate of increase. US deaths are now almost 80,000. Global deaths now exceed 281,000. Although much faster increases are coming in four key countries, Russia, Brazil, India and Peru, there is no slowing in the UK which is has passed Spain to be the country with the second highest level of infection globally. Their health system and public management has been a clear disaster, both unable to cope with the challenge.
In Australia, there are now 6941 cases (+27 since Saturday), 97 deaths (unchanged) and an unchanged recovery rate of just under 89%. 43 people are in hospital there (-15) with 17 in ICU (-6).
There are 1494 Covid-19 cases identified in New Zealand, with two new case yesterday, a rise unchanged from the prior day. Twenty-one people have died (unchanged). There are now two people left in hospital with the disease (also unchanged), and none are in ICU. Our recovery rate is now 92% with 123 people known to be infected and 87 of those are in 11 active clusters. That means 36 cases are recovering in self isolation in the community. The cabinet decision on when to move from L3 to L2 will be made at 4pm today, but they are probably boxed in now because almost all of New Zealand is acting as though we are already in L2.
Wall Street ended last week with a rise of +3.5%. In Europe, the Frankfurt DAX was up just +0.4% for the week, but the FTSE100 was up +3%. In Asia, Shanghai gained +1.2% in their shortened week, and Hong Kong was down -1.7% for the period. Tokyo registered no gain, falling for most of the week but recovering it all at the end. The ASX200 gained +2.8% over the week, while the NZX50 Capital Index gained +2.4%.
The UST 10yr yield will open the week at just under 0.69% and little-changed from Friday. Their 2-10 curve rose sharply last week but is unchanged today at +52 bps. Their 1-5 curve is unchanged at +18 bps, and their 3m-10yr curve is also little-changed at +59 bps. The Aussie Govt 10yr yield is still at 0.95%. The China Govt 10yr is stills at 2.63%. And the NZ Govt 10 yr yield will start the week also unchanged at 0.57%.
Gold is lower today, down -US$3 to US$1,703/oz.
Oil prices are marginally higher again today. In the US, they are currently at just under US$25/bbl. International oil prices are just under US$31/bbl.
The Kiwi dollar is firmish and is now at 61.4 USc. On the cross rates we will open at 93.9 AUc. Against the euro will open at 56 euro cents. These rises mean the TWI-5 is now 67.1.
Bitcoin is being dumped today and it looks like last week's halving hype is being unwound suddenly. It is down -14% or -US$1,372 in the past few hours to just US$8,541 and its lowest level of the month. 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 ».
209 Comments
"Bitcoin is being dumped today..."
Ah, yes. That market based on fresh air, enthusiasm and blind belief. So pretty much like 90% of the
'real' markets then!
And as such, it's only a matter of time and degree until all markets 'do a Bitcoin', and return themselves to a true value. Where is that? A lot lower than they all are today.
To be fair, the entire market "did a bitcoin" a month or so ago, and I think for some of that time stocks became more volatile than bitcoin, with the same degree of new money flowing in. Who doesn't want to buy Air NZ shares and get +80% in a month or whatever ridiculous move it was.
The Nasdaq already back to early Feb 20 levels, S&P back to early October levels, NZSE50 almost back to Nov levels, all quite extraordinary. Western fiscal stimulus has already passed 7% of total annual global GDP and it's still pumping. Who is comfortable being short hard assets and long cash in this environment? The only way this debt can be dealt with is default via inflation.
'...choices are being actively made to sacrifice lives for "jobs" and "profits".
1. Taiwan hasn't closed it's economy but hasn't had a single case for a month; they've eliminated it (a long time before New Zealand). It's possible with distancing & tracing, and above all, individual responsibility:
https://fee.org/articles/why-taiwan-hasnt-shut-down-its-economy/
Unfortunately with our huge welfare states in the West, and Nanny governments promising a free lunch, the West is now not good at self responsibility: no better time to learn though.
2. If you let the economy collapse, and world is on verge of that, then that's millions of lives lost literally, to poverty, etc, and it's the breeding ground also to autocratic government and the loss of freedoms that makes living worthwhile anyway. At some stage you have to open up to save your economy. ... But again, Taiwan seems to show saving lives and having an economy are not mutually exclusive ... pity WHO has sidelined that country and it gets so little coverage with everyone scared of the China bully state.
I have several close contacts in the UK. One has had covid, and all of the others have a friend or neighbour who has had it. Prince Charles, the PM, other prominent politicians, many other famous people have been victims. Which leads me to suspect based on probabilities that the disease is far more prevalent than reported, especially as many younger people have few, if any, symptoms. Sweden may well be proved right, it is an illness that is best managed and allowed to run its course. To paraphrase the Daleks: Containment is futile.
There are two main and significant models and strategies/approaches so far, the Imperial/Orthodox model and the Oxford/Stanford/Swedish model. Models are always likely to be flawed, people fail to appreciate this, have politicised the issue and have set a horrible narrative war in place. Unfortunately, humanity frequently does this and is one of our greatest weaknesses.
As more data comes in, models are tested. This is normal scientific process. Very soon we will have a very good idea which model is correct. The two prevailing scientific views are about to be tested, because if Imperial is right the R0 will go up when restrictions are lifted, if Swedish/Oxford/Stanford model is correct the R0 will continue to decline and the pandemic will end without subsequent waves. There are variations between countries obviously, but this the gist of it.
So we will know within a month and people can stop making this scientific issue so political.
To summarise;
The Orthodox scientific view is;
Infection fatality rate is around 0.6-1%
across regions (depending on
demographics).
• The number of people infected at the
time of lockdowns was modest and is
currently around 5% in the UK.
• Lockdowns have reduced the rate of
transmission. If lockdowns were released
the R would rise above 1 again.
The Swedish/Oxford/Stanford view is;
Infection fatality rate is not materially
higher than severe flu and may be
lower. (IFR ≈ 0.1%)
• The spike in deaths is driven by the
speed of transmission of the virus not
a high IFR.
• By the point of lockdown, large
numbers had already been infected
and herd immunity has either been
achieved or is near.
• If lockdowns were released, R would
continue to fall since the number not
yet infected is low.
https://nafdcovid19.org.uk/wp-content/uploads/2020/05/COVID-19-Future-P…
" models are tested. This is normal scientific process"
Spot on. It's all easy and obvious, looking back.
The only thing that is certain, is that COVID19 scared the daylights out of anyone who was given a choice of "what should we do?" Otherwise, the choices made, wouldn't have been.
BBC Coronavirus: Germany infection rate rises as lockdown eases. "Coronavirus infections are rising in Germany, official data shows, just days after the country eased its lockdown restrictions. Germany has the seventh-highest number of confirmed cases in the world, with latest RKI data on Sunday showing the reported infected tally at 169,218 and a reported death toll of 7,395."
https://www.bbc.com/news/world-europe-52604676
CJ099, cheers! But it's still not enough data to feedback into the two prevailing models and make any solid conclusions. The strategies are all experimental. At least Germany are doing their best to be very data based! I think their current strategy is to impose restrictions if there are above 50 cases per thousand of population, which is not an R0 calculation but more a healthcare capacity related risk assessment calculation.
Every government will have devised their own similar calculation and every population has a slightly different risk assessment based on healthcare capacity and population demographic.
By this time next month, we will have a much better idea.
Hi Ginger, Yes it's all rather worrying to say the least. Seems that a lot of countries are sending mixed messages about returning to work safely and agreed the more testing data there is to work with the clear the virus wave maps will be. The one I find most shocking for it's miss handling of the coronavirus is the US which should have been much better equipped to stem the spread early on, they now have 80,723 deaths.
Even President Barack Obama has strongly criticised Donald Trump over his response to the coronavirus crisis. In a private conference call, he called the US handling of the pandemic "an absolute chaotic disaster". https://www.bbc.com/news/world-us-canada-52602580
Interesting perspective from NY Times on how Pandemics end.
https://www.nytimes.com/2020/05/10/health/coronavirus-plague-pandemic-h…
It seems from the behaviour observed over the weekend that NZers are choosing to signal the social ending.
Daleks are really quite intelligent. Who would have known!
https://www.theguardian.com/world/2020/apr/06/self-isolate-mystery-dale…
'Containment is futile.'
Disagree. Again, Taiwan is the proof Covid can be eliminated while your economy still runs. I urge you to read the link in my header comment, however, as it shows sadly how their solution relies on the two things New Zealand no longer has, nor much of the West anymore: transparent governance (Labour is not that); and self-responsibility - we've unfortunately voted that away at the emoting booth over the years every general election: and look at the current push for a UBI to pay people for ildeness. The last paragraph of the linked Taiwan piece sums it all up:
'To conclude, with transparency and diligence the Taiwanese government has avoided many problems. The key is that the Taiwanese government and the Taiwanese people understand that the individual's own responsibility and actions are essential to suppressing the coronavirus pandemic, not a mandatory massive shutdown. This is what the world needs to learn.'
Also, the Taiwanese know too well what a bunch of liars and thugs the CCP are. So they acted immediately, on both a government and individual level. Same in Hong Kong, the people defied the government and wore masks (masks were banned so the CCP could identify and disappear protesters).
Taiwan had a great advantage in that their health minister was an epidemiologist, recently senior at Johns Hopkins University. He recognised the dangers early with his doctor's hat on, not his politician hat. An early, hard move was extremenly effective for them. Nothing to do with politics.
In a 'wider' philosophical sense, everything to do with politics surely David? For a start due to Taiwan knowing the threat of pandemics out of China's wet markets, for the last two decades they've had a pandemic plan which they implemented immediately which was most of the battle won right there. But after that they are a free market economy that still recognises self responsibility as the cornerstone of a free society with a small state, and thus could trust the population to be sensible with social distancing, masks etc.
Compare that to here where via our 'politics of the free lunch' from both our major parties, and the nanny state, we probably can't be trusted to do this right. We've been reduced to children.
They've also got people willing to be tracked for contact tracing.
The same right-wing folk I see ranting against anything and everything here in NZ are also ranting against using a contact tracing app. These loons will prevent an example like Taiwan being emulated in NZ.
Absolutely agree!
A lot of narrative is lives verses economy but in reality its an "AND" situation.
How can we reopen and keep people safe? Supermarkets, gas stations and even dairys havnt had much propblem keeping open over the lockdown and staying safe, most other businesses should have the ability to do the same, perhaps within certain guidance.
MH - I find it interesting when people carry on chanting. We were running exponential growth on a finite planet. That process was always terminal, and obviously was going to peak near-term. So why the attempt to continue, or support, the uncontinuable?
The global 'economy' was already on life-support - only believable if you thought the future could underwrite, or if you believed those who claim that paper claims are assets. Get used to it - there was going to be a trigger and this is looking more and more like the one.
Time for a re-set. Minus growth. Hasn't it been great with the silence?
But at the same time disease was always going to be a feature of the downhill ride. It was a problem of risk managament, and quarantine does nothing meaningful to address the risk. I'd argue the civil rights breaches are going in the opposite direction, they are going to be seriously threatened on the way down and you want to do everything you can to hold on to them as long as possible.
Don't know about a global reset but our government is considering a hasty return to the good old growth scam of record migration by opening up our borders for international students .
This time around, GR seems to have a new marketing ploy: position NZ as a safe haven from Covid-19 for international students. Seems a desperate attempt to revive a dying industry since safety of students and quality of education are less of a priority than the promise of jobs and permanent residency for Asian students coming to NZ in droves.
Goodness me ... 'Time for a re-set. Minus growth. Hasn't it been great with the silence?'
If you're one of the 1000 people per day going on unemployment benefit, and we've barely started the unemployment run, it will skyrocket at end of wage subsidy, but if you're one of the people who've lost their economic lives, their security, in many cases it will be marriages, ill health affects, mental depression, sadly for those over 50 years old, they may never work for a decent wage again and are looking at poverty in retirement... No, the silence isn't great.
Mark. Over 50 boomers are the affluent ones so save your sympathy. I know that because I regularly read it here on int.co. Data showing that 2/3rds of retirees rely entirely on NZ super for income and only around 10% have enough alternative income to live independently of NZS is fake news.
Agreed. One of the issues with the Sermons from a High Pulpit is that they utterly and completely fail to recognise the realities of the South Aucklands, the Northlands, the poor huddled masses in short, and the massive support that they get from the productive/tax-producing parts of the country. Reduce that productive part of the economy by whatever means, and the squeeze goes on those least able to cope.
It would be different if the Sermonizers were to be seen in the soup kitchens and food banks. But they are not: they are holed up on their subsistence farms, issuing incantations about Finite Planets and The Way We Must Live from now on. It's simply a quasi-religion: fine for the Believers, but like the earnest souls who door-knock and seek Conversion to the True Path, totally irrelevant to the rest of us.
And then there are those huddled masses. Again. Let's hear a workable prescription of how to get Them from here to whatever Utopia is planned. Until that arrives, the sermons are simply all noise, no signal.
I get the impression both sides apply this description to the other right now. We're certainly seeing religious fervour from would-be skeptics who all seem to have the same talking points common also to astroturfing outfits in the USA. And a newfound concern for poverty is remarkable indeed, distinct seemingly only in the fact it now could be experienced not only by the deplorable welfare queens.
What a load of crap. Taiwan managed to beat the pandemic because they were:
A) Well prepared. Due to the SARS virus, they had the people/infrastructure in place to respond quickly
B) One of their top leaders is an epidemiologist, so understood the steps required and how urgent it was to get on top of it early
Almost every country in the west was woefully unprepared, and had neither the testing or contact tracing tools available to get a handle on the virus. The lockdowns are simply a way of suppressing exponential growth while we catch up on putting in place the testing and tracing.
Lots of countries could have reacted faster with boarder closures (even if they didn't have test/trace capabilities). But the same people now shouting "start the economy" would have been the same people that would have screamed murder if governments closed boarders earlier than they did.
Temperature monitoring seems to have played a major role, as well as masks and gloves. Also, little things like a handy box of tissues by the lift buttons.
I went to the bank a couple of days ago to get some cash and I was surprised they did not have tissues by the machine. I had, however, put a couple of tissues in my pocket before leaving the house, just in case. Darned dangerous those touchscreen thingies, can't be too careful you know.
Average IFR (infecton fatality rate) is about 0.5%, (many sources now in approx agreement 0.4-0.6%), though will vary a little with population average age. ~1 in 200 die if infected. But Only about 1 in 100 under 50 die, a couple more 50-60. So most of working age population has 1 in 20000 to 1 in 5000ish chance of death if whole country is infected. Not much difference to annual risk of dying in a car accident. Essentially all the risk of death is for over 70's for whom we are now condemning the whole country (excepting civil servants) to a Depression. When general population realise this they will quickly change their tune.
There is an epidemiology to deep financial distress too. Suicides, higher mortality from despair driven behaviours like addiction or family violence. Young adults whose long term prosperity is wrecked by inability to get onto a career path - long term unemployment beckons to so many of them, and also much worse standard of living for most. All done for the sake of 3-4months worth of additional deaths (at average annual death rate in NZ). I think most people in NZ (including most elderly) would not judge that tradeoff to be worthwhile.
Foyle, this is more false equivalence. There is no either/or lockdown vs recession. There would always have been a recession triggered by the pandemic regardless of government response and the data was there on that before any lockdowns occurred (barring China). In fact, everyone's favourite example of Sweden, is headed or already in a recession and they didn't enact strict lockdowns. You are over simplifying the issues.
Sure, but the depth of the recession and pace of bounce-back is driven to a large extent by the strictures and duration of the lockdown bankrupting businesses and wrecking confidence that take a very long time to rebuild. That won't show up in data for months or years to come but is being baked-in by poor govt decision making processes now.
I guess instead of reversing immigration Foyle we could just fix our housing shortage by ending the lockdown now and as a society just going for it, for the good of the 'economy' - how does that sound?
Reckon we could reduce the NZ population by 20-50,000 via COVID deaths and make a few more homes available for sale while the market starts to fall?
Great idea...lets do it!
Somebody's parents or grandparents....who cares? They'll free up a home that can be sold during a falling market!
*note this comment contains significant sarcasm, if not completely so.
Respectfully, I disagree Foyle. The world is highly indebted, every asset class was in a bubble, wage growth had been slumped for a decade. We were primed for a major recession, irrelevant of what triggered it. Many companies clearly had no cash buffer at all and that is the real reason why we are entering a deep recession. Businesses started collapsing before any lockdown was announced, behaviour was already rapidly changed. The entire global economy has just been exposed to have been incredibly fragile, almost all had been running on fumes.
There are many ways to understand why a recession becomes protracted or morphs into depression. The Great Depression has been analysed ad naseum. Governments attempted various strategies but each of them ultimately failed. The people lost faith in government and governments capacity to effect change, which I would suggest is one of the defining factors of a depression. When people are scared, if they believe there is no hope, if even the government are ineffectual, then behaviour naturally becomes depressive. I would suggest that sentiment is the dominant force. Sentiment had been exuberant, unsustainably so. We should not have been shocked by a pandemic. We should have been prepared for it, we have the resources to have been better prepared than at any point in history, with excellent medical and communication resources and yet we downgraded any risk and left ourselves exposed because we were over confident. Predictably and has been shown in much psychological research, the equal/opposite reaction to this unforeseen risk in a time of perceived invincibility, will be a severe contraction, possibly in an equal and opposite measure.
The startling thing about this low risk of dying for younger people is that if you were to selectively infect lowest risk 70% of population in optimal manner (minimum viral dose, peak immune system condition beforehand) then you would only have a few hundred mostly middle aged adults dead on way to achieving herd immunity. That's a similar number to the extra suicides we are going to see in next couple of years (estimated at +1% (~6/year) per +1% unemployment). Also seems we will soon be able to genetically screen for most vulnerable immune system phenotypes to reduce risk further.
It really hasn't, because the isolation of elderly in UK and Sweden has been very porous and hasn't prevented the spread into that high risk population where most of the deaths are occurring. So Sweden and UK are likely still only about 10% of way to herd immunity. They won't stay the course.
It's not (and never has been) about any dollar, almighty or otherwise. That's just a tired and hollow socialist mantra.
It always was, and is, about balancing sickness against poverty. The ability to feed, house, clothe and keep your family warm over winter.
Empty platitudes don't feed anybody.
Foyle, it is much more complicated than you have presented it. It's not simply about the IFR but the transmission rate, the population vulnerability demographic, the level of population immunity and the healthcare system capacity.
Whilst the IFR may indeed be around 0.5% or even less, the fact that New York had to park freezer trucks out the back of their hospitals tell you that something else is going on because the healthcare system was not able to manage the levels of death. The transmission rate is clearly much higher than any other virus currently circulating, which is mostly because we have little immunity built up yet. This is pandemic 101. Transmission rates will likely be much lower in a few years because of this and the virus will be endemic in the population (best guess, barring a major mutation). This is not the issue, the issue is avoiding human tragedy over the next few years and preventing health systems becoming overwhelmed, lots of Covid and non-Covid otherwise preventable deaths across all demographics and managing a compromised workforce.
It's not black and white. Saving lives now at cost of years of poverty for NZ costs many lives indirectly. Many economists say that cost (in life terms) is much greater than what is being immediately saved. My take on it is that govt response was sensible for a 2-5% IFR, but not for 0.5%. Quarantining NZ for years is will be very damaging. Lockdown/isolation is costing on the order of $1 million per quality of life year (QALY). Pharmac QALY's at about $50k. That illustrates awful govt decision making. https://iea.org.uk/is-the-lockdown-worth-it/
Here's an immediate example: Pharmac has just withdrawn funding for Keytruda. Something like 1400 patients that could potentially have had their lives extended by up to 5 years if this drug was funded at a cost less than 10% of what is being effectively spent on the elderly lives saved by this lockdown ($100+ billion loss to NZ to save ~20000 mostly elderly victims, and giving them a few extra years life mostly in resthomes before they croak)
An immediate example of what exactly? Is this the first time Pharmac or any other government has pulled funding for a drug that "potentially" extended lives? You have to be kidding. It happens all the time. Or are you trying to suggest that in a global recession triggered by a pandemic that there aren't added pressures on Pharmac budgets?
You are oversimplifying issues to suit your narrative again. It's something that is happening everywhere and there is good behavioural research on that too. My own attempt to reason with you is evidence of my own psychological reaction and I must at this stage, admit the futility of my own actions and leave you to your beliefs. I'm not helping.
Good luck moving forward, i'm out.
"So most of working age population has 1 in 20000 to 1 in 5000ish chance of death"
- come again ? are you saying that Covid19 IFRs in working age populations are .005% to 0.02% ? They are an 1-2 orders of scale higher as you yourself discuss .
You should at least get your very basic numbers right before making sweeping statements - what utter rubbish.
Your calculations are wrong - they implicitly assume that there are as many 50-60 year olds as the population count as the whole , and there are as many under-50s as the population as the whole .
You also make no allowance for the fact that under-20s basically do not die from Covid19 at all , so fatality rates for 20-50s are higher.
Just wrong.
You're right. Dumb error on my part - what comes from mental rather than paper calculations. Revising with population data for mortalities and demographic pyramid I get about 10x worse than I stated. If infected all under 40yr olds then 1000 dead (1 in 2000 chance of death). 40-50 another 630 (1 in 1000 chance of death) and 50-60 another 2200 (1 in 300 chance of death). That gets you to 80% of population infected for ~3800 dead.
They caused this disaster and compound it by aggression to anyone who wants an investigation. Already punishing Australia with tariffs. Are we "ANZACS" going to ignore this bullying and continue to deal with this evil regime? Are we going to sell out our friend for profit? Is this what we have become? Time to move on any CCP sympathisers out of this beautiful country. They simply cannot be trusted.
TLDR;
if Imperial model is right the R0 will go up when restrictions are lifted (in countries with existing widespread infections), if Swedish/Oxford/Stanford model is correct the R0 will continue to decline and the pandemic will end without subsequent waves.
As restrictions are being lifted across the globe. We will know very soon which model is more accurate. That's normal science it shouldn't be political. Science is a process of testing hypothesis over time. Always has been.
The science should definitely not be politically influenced but the response to it is. We have an ineffective health minister and a cabinet so bereft of depth that its default decision making process is deferral to committees and specialists. It now needs to make a political call that is informed, not dictated to, by scientific advice. Cindy will be forced to make an actual decision that presents real political risk and which she will this time not be able to outsource.
That wouldn't be my stance. My stance would be for leaders to delegate to chief medical/science officers, ask them to assess the risk based on the best available evidence, assessment of population vs healthcare capacity etc. Then do what Germany has done and set a figure on it. Have the scientists explain the formula and what variables would cause them to change the formula (ie increasing healthcare capacity or a SARS-CoV-2 infection wave occurring at the same time as the season flu peak etc) and change the formula only if/when there is scientific evidence to do so and based on viable restrictions.
That evidence might also include compliance issues, for instance, there is always a limit to how much you can expect of a population in terms of behaviour. Countries that have implemented more transparency and scientific clarity have less political issues. In Sweden, it is chief scientist doing the majority of the communication on strategy and their population is very compliant (that is NOT a comment on their virus strategy but on their communication/political strategy). Obviously there are other factors too, especially cultural ones but the less politicised this is the better IMO. Many governments choose a bi-partisan cabinet during war for exactly this reason. This pandemic has become highly politicised and that could well end up being far more disastrous that the virus or recession itself.
Now this is interesting, the RBNZ is hiring a "head of money" futurist to consider issues like a new digital currency for NZ: https://www.coindesk.com/new-zealands-central-bank-is-hiring-a-money-fu…
"I'm sorry, your kiwi-coin wallet has been temporarily disabled due to uncivilized comments made on a public forum. Please deposit an additional 100 kiwi-coins to unlock your wallet, or alternatively book in a session at your local friendly re-education facility. And remember, if you have nothing to hide, you have nothing to fear!"
"allowing under-pressure governments to access huge amounts of new borrowed money".
That's debt, right DC?
So it reads "allowing under pressure governments to steal from the future at an even greater rate than the grotesque rate they were already indulging in".
No charge for the subbing.....
I mean lots of people won't see a bigger picture and for them the reality of the coming months is just bleak misery. For those who do, they're going to struggle to understand how a billion dollar airline gets a $900m taxpayer bailout but as a taxpayer they face losing their home or an agonizing plunge into negative equity with little assistance at all. Anger is an understandable reaction, but on this scale, the consequences that flow from it are going to be socially devastating.
Sadly that does seem to be happening globally in government departments. How's your daughter in California, there's seems to be a lot of upheaval job wise across the US at the moment. Even Musk recently announced moving his Tesla plant HQ over lockdown row, with his "FREE AMERICA NOW" slogan. Which is a bit hypocritical of Musk since his main Tesla car plants are in Shanghai China.
BBC Coronavirus: Elon Musk vows to move Tesla factory in lockdown row. "Billionaire Tesla boss Elon Musk has said he will move the electric carmaker's headquarters out of California, after he was ordered to keep its only US vehicle plant closed." https://www.bbc.com/news/world-us-canada-52601750
CJ. Hear the man himself.
https://youtu.be/RcYjXbSJBN8
He talks about it in second half.
So answer me this Henry; If Musk really cares about the US people and economy, Why is his main Tesla production car plants in China?
Not to mention that he has also sparked controversy for promoting an unproven treatment for the virus, and for asserting, falsely, that children are "essentially immune".
He's quite a remarkable guy but at the same time sounds like he has serious daddy issues and can be a complete c%#t when he wants to be. Read the book about him a few years back. In saying that I'm a fan of what he has done with SpaceX and quite like his cars (apart from the latest model..).
Think he's constantly under so much stress that he isn't always that well balanced - his tweets can be all over the show. And look at the name of his latest child!
From my extensive reading, it would appear that children are ’essentially’ immune.
From today’s Daily Telegraph. ”The risk of coronavirus for the young is “staggeringly low”, the UK’s top statistician has said - as he condemned the government’s “embarrassing” handling of Covid-19.”
He says only two under 15s out of 10 million in that age group have died. Good piece, well worth a read although I think it’s paywalled.
Before now: Greece. Spain. Italy. Basket case countries that have seen massive exodus of young to more prosperous countries. This will start happening here in a few months if (as looks to be the case) Australian economy bounces back fast and NZ remains mired in wuflu doldrums.
the key problem now is purchasing power
we (the global economy) are battling to inflate purchasing power and as the deflationary effects of people being put of work spreads its only going to get worse ...
So we have to resort to artificial income everywhere …
But it all flies in the face of economies to scale so its a double whammy
At some stage deficits blow a currency to bits
The currency issue is the big one. For years a bouyant NZD has protected local consumers against the higher prices we are charged for consumer goods. We can expect a major drop in living standards once the NZD starts to unwind. Whether bank financing becomes more expensive or not, it will become an excuse to lift interest rates, which means less money to spend after mortgage repayments. At this point, deflation becomes a feedback loop, and only another external event can right the ship.
As an export led economy though, I guess we just have to make sure our exports keep flowing and that our dollar does depreciate at the same rate as everyone elses? Yes, the tourism market will definitely crater, I suspect the housing market will go into a semi-bailout period of hibernation though as the RB will protect the banks at any cost. Hopefully they are only say 20% of the economy. If we can deflate our dollar a bit more compared to everyone else and our markets keep buying... well I guess that's been the model for everyone for the past decade or more. Now it's just going to happen faster and with more hope!
We're assuming the same middle-class/premium buyers for our products will still exist in other countries, and that other countries won't be seeking to protect their own producers or encourage local consumption to protect their own industries. I wouldn't lock in a sustained farm gate take into cashflow forecasts just yet, and that's before local cost loading of things like emissions, which other countries may simply abandon. I wouldn't really want to be a farmer or exporter right now, given many NZers are likely to be unsympathetic if prices rise locally to make up for potential lost export receipts.
"if everyone's currency deflates everywhere at the same time.."
this seems logical but only holds for a limited period -it has been the playbook worldwide since 08 … ultimately DEBT is being devalued everywhere But it heads to a point where there is no return on capital. And then what?
Country specific - it boils down to FAITH in a currency
Can you produce enough (of something) to enable the faith to hold … so that those essentials are still traded as supply lines tighten / as rationing begins?
At what point can you not print fast enough to keep your populations buying power from eroding anyway ...
Agree, it becomes a balancing act between printing and not causing too much inflation. If you listed to Ray Dalio's excellent youtube video on "how the economic machine works" this is the balancing act he indicates:
I've followed all Dalio's stuff quite closely the last few years and read his book 'Princples' a few years ago.
I'm still trying to get my head around all the new debt that is being created and yet our economies don't appear have the capacity to create goods and services to create output to service that new new debt and its interest. Seems to me we're heading towards defaults and deleveraging this year. A game of hot potato to see who is left holding the bad debt. His comments towards the bond market have been very negative lately.
"and yet our economies don't appear have the capacity to create goods and services to create output …"
Economists talk about underutilised capacity a LOT … and yet there is massive OVER capacity worldwide (particularly China)..
We aren't hamstrung by ability to produce stuff … its more a limitation around viable demand for the stuff …
And that ultimately comes down to a resource limitation issue (NET energy available to provide further growth )
you need to visit someone that lived through the depression, my memory does remember after rogernomics when unemployment rose to double digits and in small towns that were government department workforces they were almost wiped off the map
https://teara.govt.nz/en/graph/24362/unemployment-1896-2006
Peak unemployment hit NZ in the 90s and the maximum was 11%. When I finished high school I knew there was no chance to get a job competing with people that are experienced so I went to uni for 5 years instead. WINZ at the time didn't put any students on the dole, instead there was a special student dole which wasn't counted in the unemployment figures and they also didn't bother hassling you to get a job.
What I recall was a brutal impoverished time with the government burying true unemployment figures. Some will experience long term unemployment.
that was when the mother of all budgets came out where they also cut benefits, so first roger douglas made people in their thousands unemployed then ruth Richardson punished them
https://teara.govt.nz/en/photograph/33885/the-mother-of-all-budgets
I was insulated to some degree by being in the military, the pay was atrocious though. During my short tenure they cut back on employment conditions also, like a reduction in annual leave. Construction industry got hammered at that time, and the build up was not too dissimilar to what we've just had. One thing I note on these pages is a lot commenters didn't live through it in NZ, or the bubble times that preceded it.
Those times were awful. I worked in corporate white collar so had it not as bad as those in no longer viable manufacturing or employed in one of the government job creation enterprises but nevertheless endured endless rounds of painful restructuring. I still vividly recall the cull days when those about to be dumped but didn't yet know it gathered with the rest of us, who mostly also didn't know if we were to survive. Some corporate dick then gave a scaffold speech, read out names and you went forward when called. We realised later that big envelopes meant you were being gassed, small you were staying. A scurry then to phone the spouse to say we had survived the cut while nearby the tears flowed as redundant ex colleagues packed up their desks. Lives upended; over 50 and it was to the scrapheap. Few other jobs available. When I think about the C19 lockdown I recall those traumatic days and the terrible price people will pay if we hack further into the sides of our economy.
In Mexico City (21 million):
1. the average wage is $9 a day,
2. coke is cheaper than water (obesity rates are high),
3. there are places the police cannot go,
4. crime rates are high, corruption is systemic,
5. police wages are so low they supplement their wages through corruption (the shake down),
6. social distancing is impossible in places,
7. it is safer to live in an apartment building and if you have a house of value you need a large fence,
8. health care is limited,
.. people are constantly leaving the country.
Think the crappy parts of the USA and parts of Russia....the parts of UK that have never recovered from the 1970’s and no way out....inter generation poverty...no teeth and grim / shi****ty existence.....parts of Glasgow spring to mind. Drug and alcohol abuse and lots of violence....worse case example. Parts of NZ that have never recovered from the reforms of the 1980’s spring to mind. I am very much reminded of the time in NZ that gave us the Poi E and the hollowing out following the closing of the hospital’s, freezing works and dairy factories. It was hard a lot of people....I remember the pain in our household and we were well off comparatively. I know that those industries had issues and were not always efficient...but take away peoples hope and dignity and choices and results speak for themselves.
It looks twice as good as johannesburg with ~40% unemployment, dual societies.... the 'have's' in gated communities (sometimes guarded) with the 'have not's' living in slums right next door living off $30-$40 per month
People have metal spikes and glass built into fences and bars on all windows - fearing going out at night and not wanting to risk stopping at red lights at night in case you get shot for your car
NZ unlikely to reach anywhere near that state of affairs, but you can safely assume it will not be a great situation to be in
Remember the days when the Lady stayed home and looked after the kids until they left home, then wanted a job at less than a Mans Pay to pay for the small things in life....Numbers back then a doddle... not a bleedin necessity.
But now debt is multiplication of the norm... so kids suffer, women worked, Houses grew and Businesses were stretched and Debt expanded beyond all understanding via leverage.
Stock Market is on Upswing as big listed companies are aware that come what may, wil be protected and bailed out by the governments and in the process their short comings and past failure too will be buried under the blame of Corona Virus.
So now details about the understanding between China and WHO is starting to tumble out :
https://www.nzherald.co.nz/world/news/article.cfm?c_id=2&objectid=12330…
China appears to be rocking the boat at the moment, not sure what's going on with them? BBC Indian and Chinese troops 'clash on border' in Sikkim. "Dozens of Indian and Chinese soldiers have exchanged physical blows in a clash on the shared border, Indian media report.
Seven Chinese and four Indian troops were injured, an army official reportedly said, near the Naku La sector in the border state of Sikkim.
Local commanders spoke and resolved the dispute, which took place on Saturday. The two countries have competing claims over their shared 3,400 kilometre (2,100 mile) border.
Sometimes stand-offs involve chest-bumping, pushing and shoving, and throwing stones at each other, BBC South Asia Editor Anbarasan Ethirajan reports." https://www.bbc.com/news/world-asia-52606774
There are other ways to respond. The Vietnamese people just burn down their factories. The Phillippine Government is pro China, the people less so. In the Solomons the people burned their shops and their houses. It is not just government response, the people are a force to be reckoned with, particularly in ferociously independent places like Vietnam and Indonesia. Usually it's not a good thing to upset the neighbours.
The Vietnamese I know living in Vietnam would say China (CCP) already effectively owns Vietnam (or its government). The Vietnamese communist government is just as corrupt as their CCP counterparts with no transparency. There is significant Chinese migration into Vietnam which the Vietnamese government will not explain. Chinese money and land purchases in Vietnam distorts local markets. Vietnam is economically dependent on China (as is NZ) and China does not hesitate to put the economic squeeze on Vietnam when it suits. As an example, you will find on the internet videos of (militarised) Chinese fishing boats ramming and destroying Vietnamese fishing boats in the South China sea and often killing Vietnamese fisherman.
Here are 3 simple steps, suggestions. - if not, why not?
"Coming Clean"
1. Answer all questions. At briefings and any press conference. Answer all questions. It changes the pyshology, you see in Australia, all the politicians, all the health folk, tell reporters, calm down, I will answer all your questions.
"Start from the Start"
2. Provide a power point slides.
A table, showing PPE, testing reagents and labs. - what we have, what we need, by dhb, by GP, aged care, hospital (+ icu). - add features around different types of tests.
And
Contact tracing, show the workflow and how long each process takes.
And
The specification required by contact tracing app or diary. Specify what businesses, groups need do for contact tracing, what happens to the data, how it fits into MoH workflow.
"Case Data"
Provide base case data with time stamp. All of it.
I would shift that first point to 'Answer all good questions'. Sadly there are a lot of personal agenda based questions being asked in the daily press conferences. Seems some of the reporters there are trying to capitalise on the situation by baiting the PM and others to react to emotionally charged and leading questions, so they can scurry back to their desk and write a report and get an A+ on their report card.
Our organised media conferences are staged affairs where Ardern can pick and choose which patsy questions she will take. It's why TV 'news' featuring anything from these events is not worth watching. The govt is now spinning the directive from the department of prime mister and cabinet for ministers to deny interviews to some media, as just a 'miscommunication'. The inconvenient truth is that it is no such thing given multiple journalists report having been denied access to ministers for some time.
All this bad news is great! As the Reserve Banks pointlessly continues to hoover up assets the sharemarkets will go into orbit.
It used to require skill and luck to pick winners and losers. Now you can buy anything (except airlines, that's strictly a government "investment") and be rewarded. All you need is money to make money!
Rewind the clock to 2006 and listen to this heads-up:
https://www.youtube.com/watch?v=u6iZ2e11mkk&feature=youtu.be&fbclid=IwA…
"and it is now clear that choices are being actively made to sacrifice lives for "jobs" and "profits". "The economy" trumps all."
The economic juggernaut operated this way prior to the virus.
Obviously there are negative traits existing within humanity that have been exacerbated over the past 2000+ years by the prevalent social and economic conditions of the times, at the expense of positive traits.
Yes, one of those traits is "denial". There were a lot of significant tensions before COVID, Trump, Brexit, the riots in France, Greece, Italy and so on. Throw in a few radical groups who see opportunities, now mix in China's aspirations against what other will do to secure resilience and wow! the potential is frightening!
Being in NZ is both a blessing and a curse. It is nice to be away from the centres of the turmoil, but we are so vulnerable to the consequences of that turmoil, the suffering will spread to us anyway. This is not just a viral pandemic, the illness will attack the social, political and economic systems as we know them.
Well we are obviously not being told something.. On one hand L2 is still very restrictive to the economy and contact tracing etc is to be implemented at a large cost. Then in the same breath they say go and play contact sports not a problem, in public parks, not a problem, share the changing rooms not a problem. The same people are playing these sports that then have to go to work and keep a meter away from anyone and sterilize any shared tools/computers. No wonder people are confused and are just doing there own thing now.
I have to admit, I'm guilty of double-think on this. I find myself seeing so many people breaking rules, going to beaches or playing sport at L3 and can't help find myself wondering whether Level 4 was needed at all. I'm aware of the huge flaws in this logic, but it's a fleeting feeling.
Doesn't do much for buy-in for any future increases in the alert status though.
Is why the threats from govt that we shall all be sent back to detention if we break the rules is just wellington flannel. Unenforceable; the people gave their verdict with the middle finger on the weekend. There will be no further L4 lockdowns. We only ever had one shot at eradication/elimination, it was worth a go given we didn't know how this virus would behave. But we now know much more about the virus and the wider costs of Cindys heal the world dream is dawning.
The trick is to have troops from a different region, one that has historical greivances with the one you want them to control. It's all about whether the soldiers will actually shoot when ordered to. Well, actually, do they shoot who they are ordered to, or the officers doing the ordering. So you staff the Berlin Wall with Russian soldiers, not East German ones. Doesn't seem relevant here.
imaging going to court...sir you where caught at the beach in a large group walking which is against the L2 rules...yes judge I was, but your honor I played 80 minutes of rugby with these guys yesterday and along with 35 others..plus the managers and coaches...charges dismissed.
Well the government may have painted themselves into a corner with their initial strategy. It could make the last 7 weeks or so a waste if the death toll starts climbing to Sweden type rates (3k at present). Perhaps that is insignificant in the bigger scheme of things.
Four weeks was a reasonably astute political decision - enough to claim it gave enough time to figure out how this thing was travelling but not so long as to permanently cripple the economy. If the genie escapes in the next few weeks govt will defend itself by saying 'the economic damage would have been too severe if we'd gone longer'. By then our death toll of a thousand or so will look trifling compared with the horror show that will have unfolded in the developing world. The narrative will shift to how lucky we are thanks to the wise leaders resoluteness.
And deteriorating relations have resulted in China giving Australia 10 days to explain why Beijing should not impose tariffs of 80% on Aussie barley, a AU$600 mln trade. Canberra is not impressed.
Canberra was provoking China to respond thus.
It is a most ludicrous and immature illusion for Australia to think it is growing bigger and taller by waging one skirmish after another against China. By placing itself as a chess piece in Washington's Indo-Pacific Strategy, Australia is still playing its part as America's "deputy sheriff." Bilateral relations between China and Australia have hit a record-low over the past three years. For almost 30 years, Australia sustained its economic growth by riding on the coattails of China's monumental development. China is Australia's largest destination of exports, largest source of international tourists and students, and one of the biggest overseas investors.
The Morrison government's adventurism to fiddle with this mutually beneficial comprehensive strategic partnership is in defiance of rational thought and common sense. It has seriously ravaged trust, confidence and shared interests, which are the bedrocks of the bilateral relationship. Canberra is treading on a hazardous path that has no prospect for a U-turn during the COVID-19 pandemic, and likely for a long time afterward.
Eric Crampton's exposes a key failure
http://offsettingbehaviour.blogspot.com/2020/05/a-rather-costly-failure…
Here is the Gad father.
Gad Saad
https://youtu.be/P1II4WBdKX0
Triggernometry.
Germany is the loudest and largest opponent, but they are supported by the Netherlands, Austria, Finland and Bulgaria. It's proving quite a divisive issue in the EU, and states like Italy, Greece and Spain remember the debt, austerity and pain imposed on them in the last crisis.
plenty of NZ companies have turned to producing PPE, if there is a market they will be available
https://www.manufacturingnz.org.nz/resources-and-tools/covid-19-ppe
Its issues like the lock-down strategy where I think we should have some type of online voting capacity to form government decisions. There is clearly quite different opinions on when we should come out of lockdown and what business should look like/be limited to. Obviously there would need to be science behind the way options are proposed to ensure it reflects society in a representative fashion to drive decision making.
Could we have a system where all voting age people have secure access to a voting portal where the government give options and the people vote? I feel it would strengthen democracy as opposed to the opposite e.g. America under lock-down. Let the people speak.
Any thoughts? Open to the good, bad and ugly (wouldn't expect anything less here!)
https://en.wikipedia.org/wiki/Electronic_voting_in_Switzerland
Good idea in principle, terrible idea in practice.
Letting the uninformed public make decisions on matters of public health? Bad idea in principle, bad idea in practice. Just look at the crud that been thrown about in comments here, and i'd think the average poster here is a bit smarter and better informed than Steveo the truck driver.
Voting by it's very nature implies you are choosing between alternatives. Presumably if we were to vote on a set of public health policies, the set of policies would have been put together by public health experts. It's not like they are going to take write in ballots where you submit a 300 page essay detailing your individual public health proposal.
Disagree entirely. It cannot be a democracy if you firewall off parts of government policy and the public is not allowed to have a say in it at all. An informed public is necessary for a democracy to function well, I agree with you there. The onus is on the media to inform the public with expert opinion.
At the moment we have the worst of both worlds - an apathetic electorate, and elected representatives that lie and scheme and don't follow through on their campaign promises.
I'm not saying we are ready for it now, but if we wanted a direct democracy rather than a representative one, that is what we will need to have. Our education system will need to produce citizens that have at least a foundational understanding of civics and economics. Our media will need to be actually willing to evaluate the merits and demerits of policies in a way that is founded in reality and digestable to the general public.
Why - we let them vote on other things like capital gains tax and foreign buyer bans, age of superannuation etc and clearly most have never been to university and completed any economics/finance papers nor have any idea the effect their views have on the long term prosperity of the country.
Why then not let them vote on something like health/lock-down where they are equally unqualified?
I 100% disagree to the comment "to sacrifice lives for "jobs" and "profits". "The economy" trumps all", this is an ideological standpoint, not a factual one
To note Lord Sumption (former justice of the UK supreme court) who notes that he believes this is COVID-19 reaction is 'collective hysteria' and notes that while there is a very real threat to those who are vulnerable (elderly and those with pre-existing conditions) believes the government and media have seriously exaggerated the threat, and notes that freedoms are often not taken through force by tyrants, but surrendered when very real threat exists and action is demanded of government - and no-one is questioning the overall immediately or long term costs, as they simply want action
He notes that we have to recognize that this is how societies become despotism (ruler has absolute power)
He asks whether it is serious enough to put most of our population into house imprisonment, wrecking our economy for an indefinite period, destroying businesses that have taken years to build up, saddling future generations with debt, depressions/ stress/ heart attack/ suicides and unbelievable distress inflicted on millions on people who are not especially vulnerable and who will suffer only mild symptoms or none at all like the (UK) health secretary or prime minister?
So, what's the delay coming out of the Beehive.
For Wednesday, in Victoria, 5 house guests, groups of 10 in a park.
https://youtu.be/-oBFwRevWhw
Foe next week (18/5), in Western Australia cafe & groups: 20 indoors.
30 outside restaurants to open (limited).
https://youtu.be/flV7t8v62zo
From today in South Australia, regional travel restaurants outdoor dining, groups up to 10. - this phase lasts for 4 weeks.
https://youtu.be/flV7t8v62zo
From 15/5, in New South Wales. Gathering of 10 people inside (cafe, 4 sqm), 30 outside, 50 to a funeral.
https://youtu.be/cPyHvjfckYA
Gladys is great!
Here is a sense of the problems and disfunction of the contact tracing backend.
These go to the core.
The country's largest public health team has revealed it would take an entire day for it to dig Covid-19 case information from its systems that other regional teams were able to provide within hours.
Auckland Regional Public Health has declined to provide the information about its cases from clusters outside the region - a decision it took a month to explain.
https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12331000
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.