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China rolls back emergency pandemic policies, but faces rising flood risks; Thailand & Singapore suffering; global PMIs show recovery; Australia faces severe CBD property retreat; UST 10yr yield at 0.59%; oil stable and gold near record high; NZ$1 = 66.5

China rolls back emergency pandemic policies, but faces rising flood risks; Thailand & Singapore suffering; global PMIs show recovery; Australia faces severe CBD property retreat; UST 10yr yield at 0.59%; oil stable and gold near record high; NZ$1 = 66.5

Here's our summary of key economic events over the weekend that affect New Zealand, with news major write-downs are ahead for commercial property portfolios.

But first in China, they have started to withdraw the emergency monetary policies introduced to offset the impact of the coronavirus outbreak as their economy continues to recover. Given the stronger-than-expected economic rebound in the second quarter, and with concerns looming of creating excess debt and financial bubbles, the need for easy cheap debt is easing now.

But their rebound is still threatened by wild weather in July. They are bracing for torrential downpours and hurricane-force winds across large parts of the country in the coming week, and 93 major rivers are still above emergency warning levels. There are no new updates on risks to major river dams but the flooding is spreading.

Not every Asian country is recovering well. For example, Thailand has suffered a massive fall in trade in June, with imports down -18% year-on-year, and exports down -23% on the same basis and a worse result than in May. Still, they managed to keep a positive trade balance despite the very sharp reversals.

Singapore's rebound is disappointing, with industrial production in June not showing the gains analysts were expecting.

In the US, early indications of factory and service sector activity in many major economies were released over the weekend. American firms showed a stabilisation of business activity at the start of the third quarter, with the contraction in service sector output slowing and manufacturers signalling a modest upturn in production. But the rate of decline of new orders gathered steam. And a feature of this report was the rise in inflation in both input and output prices. The combination of the pandemic and trade tensions seems to be working to make American goods less competitive, and quite quickly.

The sales of newly-built American single family homes were back to pre-pandemic levels in June and +7% higher than the same month in 2019. It was a bounce that caught up some of the very sharp falls in April and May.

The retreat in the US Fed's balance sheet has stopped, and the total is unchanged now for the past two weeks. It remains under US$7 tln however although it did start at US$4.2 tln at the beginning of 2020.

[And staying in the US, a crude and disrespectful insult played out in an amazing way in their Congress. Start by reading this. Then watch this. And finally this. You can see from this what she is going to be an international megastar for a long time.]

In the EU, business activity is rising in July, and strongly too, at the best rate since February. Orders in both their factory and service sectors are rising, but inflation isn't. France led the upturn, but Germany joined in too.

In Australia, the easing of lockdowns prior to the latest re-imposition saw a very strong rebound in economic activity. But events may have overshadowed this impressive result. And Australian companies are reporting earnings down -20% in this cycle. Part of this is because CBD office towers are going to need to be revalued sharply lower. Citibank analysts said by -15% when they reported in June, Goldman Sach's July report says by -30%. The Sydney CBD now has 194,000 sq m excess capacity, Melbourne had 75,000 sq m - and that was before the latest lockdowns. Commercial property, especially retail and office, are going to suffer massively and property fund portfolios will take major hits.

The latest compilation of COVID-19 data is here. The global tally is 16,118,000 and that is up +529,000 since this time Saturday. Global deaths reported now exceed 645,000 (+10,000).

A quarter of all reported cases globally are in the US, which is up +136,100 from this time Saturday to 4,341,600. It took the US 98 days to reach the first million cases. 2 million cases came in 44 days. 3 million cases in 26 days, and 4 million cases in just 15 days. It will just be a week of so at this rate for the 5th million, US deaths now just marginally under 150,000 and a death rate of 452/mln (+5/mln) with the expected rise now kicking in to well over +1000/day as their lack of personal responsibility starts to have consequences. The number of active infections in the US is up +55,000 in two days to 2,119,400.

In Australia, there have now been 14,403 cases reported, another +808 since this time Saturday, and still concentrated in Victoria but growing in NSW in Sydney's suburbs. Their death count is up to 155 (+16 in two days). Their recovery rate has slipped back further to under 64%. There are now 5078 active cases in Australia (up +551 in two days) and almost all are community transfer.

The UST 10yr yield is little-changed at just under 0.59% and still near its three month low. Their 2-10 curve is unchanged at +44 bps. Their 1-5 curve is also unchanged at +13 bps, and their 3m-10yr curve is marginally firmer at just under +50 bps. The Aussie Govt 10yr yield is unchanged as well at 0.88%. The China Govt 10yr is unchanged at 2.90%. The NZ Govt 10 yr yield is also stable at 0.83%.

The gold price is at a record closing high of US$1,901/oz. (The record intra-day price is US$1,925/oz. In New Zealand dollars, the record high price for gold was reached in mid-May.) It has taken gold nearly ten years to return to these levels, and on an after-inflation basis gold would now need to be US$2,093/oz just to be even with inflation - although in New Zealand dollars it has managed to beat inflation, but not because of the intrinsic price of the yellow metal, but because of currency changes that applied to many assets.

Oil prices are unchanged today. They are just above just above US$41/bbl in the US and the international price is just above US$43/bbl.

And the Kiwi dollar will start today marginally firmer at 66.5 USc. Against the Australian dollar we are now also firmish at 93.6 AUc. Against the euro we unchanged at 57 euro cents. That means our TWI-5 has at 70.1 and still in the range it has found itself over the past two months.

The bitcoin price has risen sharply over the weekend, up +3.5% to US$9,914. 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 ».

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150 Comments

Economy = QE

Once the life support ventilator is removed will have to see how the economy perfomes and what the conseqhence of being on life support.

*wheeze* *gasp* *cough* *gurgle*, at least for the US economy, but its not QE (https://wolfstreet.com/2020/07/23/week-six-of-feds-lumpy-shrinkage-of-it...), its the welfare payments direct to the public, helicopter money if you will. Ours will do better, but keep that inhaler handy.

They've been hit hard, and the hits keep on coming. Texas and Florida have a massive number of total infections. Florida even outstrips New York right now, and most of their infections are recent. Even with improved treatment for the virus the death toll over the next two months is going to be really bad.

One thing I don't understand is how badly their GDP has been hit. Either there is little money getting to where it needs to go, or their economy is pretty close to collapse without the virus.

"One thing I don't understand is how badly their GDP has been hit"

behavioural economics: When fear creaps in people stop spending, people stop spending, businesses stop selling, businesses stop selling they make staff redundent etc.

"... the death toll over the next two months is going to be really bad."
Deaths of whom? What proportion are likely to be under age 50, have a BMI of 25 or less and no co-morbidities such as diabetes, cancer, hypertension, etc?
It is totally irresponsible of the media to talk about "deaths" without providing context. It is smply fear-mongering.

... because if a 51 year old with a BMI of 26 dies, that doesn't count?

What a statement you simply cannot draw a line with this virus, everyone is at risk. Far to many people dont even know they have underlying health risks. Personally I know of two people that never even knew they had heart issues untill they were over 50 and had an ECG. BMI is the biggest BS metric ever invented in healthcare, even my so called intelligent doctor uses it when what he should have is a decent set of body fat scales. Over 50% of the population in NZ over the age of 50 would be considered obese and physically out of shape.

BMI is the biggest BS metric ever invented in healthcare, even my so called intelligent doctor uses it

BMI is used as a statistical measure on population-level data to measure overall health, because we know a lot of health outcomes are strongly correlated with it. In large population-scale datasets the weight, height, age, sex and ethnicity are generally the only things collected and reported with any degree of accuracy, so it makes sense to use the attributes available to create a measure that can be used to compare groups of peoples with each other.

While it's true that All Blacks would count as obese on the BMI scale, they are also professional elite sportsman who are very far away from being an 'average' person anyway, so people who claim BMI is useless because it doesn't appropriately categorise extreme outliers simply don't understand what the point of BMI is. BMI works fine as a general health indicator for most people.

when what he should have is a decent set of body fat scales.

The scales available for domestic use aren't especially accurate. Your doctor should be using BMI and body fat scales, and of course talking to you and using other methods to evaluate health, including visual observation.

People already know the demographics who are most at risk. Do I have it right in presuming these people's lives are worth less to you?

That's a distraction.

Based on earlier worldwide outcomes, COVID fatalities often follow from 3 weeks after diagnosis. New cases across the US are close to 3x original daily case load. Cases lifted from June 22, deaths lifted by July 8th (low 700's to high 900's or 35%). Daily deaths increased since mid June is +40% - av.>1000 per day. Source: https://www.worldometers.info/coronavirus/country/us/

Even allowing for wider spread putting less intense pressure on individual ICU's, we can extrapolate - without fear-mongering - that the death rate will again lift significantly further. It's not all old and sick that die.

The average BMI in the USA is 26.5 - if obesity is a risk factor then most of the population is at risk.

Pragmatist.. .. welfare payments direct to public and helicopter money is all possible because of printing of money.

Remember ours is still on wage subsidy and other subsidies..... Also election time in NZ as well as in US so wait as inhaler may not help.

It won't be removed. Or will be replaced by something more direct. Question what happens because of it.

I don't think its QE per se but the wage subsidies. This is the thing putting money in pockets and keeping spending going. Bank lending, despite Orrs requests and demands, doesn't seem to moving an inch and credit card debt isnt growing much either.

10
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“Crime is a problem of a diseased society, which neglects its marginalized people," she said during the July 9 event. "Policing is not the solution to crime.” AOL.. has a ruffled quite a few feathers in Congress.. the stale pale males are outraged and will beInteresting to watch her future (And the comments posted here) Collins should take notes.

12
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I find it hard to believe that Collins, or any rational person, would read 99% of the ramblings that come from AOC and think "you know what, this makes sense."

Which when one reads adulation, even posted here, along the line of "she is going to be an international megastar for a long time" shows just how far off the track we are.

Well she’s 100% right in her comment above.

12
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"Policing is not the solution to crime." W rite that down somewhere. It was policing that stopped me speeding. It is policing that stops me getting robbed every day. It is policing that protects people with protection orders from the subjects of those orders. It is policing that keeps a lot of business people on roughly the straight and narrow. It is policing that keeps most of the people in quarantine hotels. And so on.
Just another self promoting soundbite.

16
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Taken out of context the statement is, of course utterly wrong. But that was not the point being made. The leading statement “Crime is a problem of a diseased society, which neglects its marginalised people," contextualies the comment and makes the point that BEFORE policing there must be responsible socio-economic policies to provide opportunities for marginalised people. Indeed in the lack of good policy, policing may actually aggravate a situation. This is as much a problem in NZ as it is anywhere in the world.

You need to go back and read the full statement before making such ignorant comments.

Ambulance at the bottom of the cliff stuff. At $110,000 a year to house a prisoner how about we try stopping people becoming criminals in the first place.

Yep. Imagine, for the same cost we could literally pay someone (and reasonably well) to be a full-time minder to a young lawbreaker in need of reform. Like a combination parole officer/social worker/employment counsellor. Someone who'll be in their ear every single day, cajoling, encouraging and warning them as necessary... Surely that would be more effective than prison for many young offenders. And, unbelievably, cheaper. Would be great job creation for some slightly older folk with life experience and a good understanding of their community, too.

So wrong. Its our contract with society that upholds law and order. Failure of this leads to central control by the sword.

No. Sounds to me more that you stay within the laws because you have to much to loose otherwise. If you had no or very little future prospects sounds to me that police would be irrelevant to you.

Right on the button red, two things mostly keep people in line - the prospect of being caught and the potential losses. If one or the other (or indeed both) are low, transgression and law breaking result.

..that's pure nonsense. The overwhelming majority of citizens abide by the law because we agree to it - we accept the social obligation and buy in.
NOT because we fear the consequence. Criminals...they don't follow the law out of fear of being caught - they don't think they will. But even they have their own social buy in - areas of criminality they will not go to.

Mark Mitchell fan perhaps?

There are two modes of invading private property; the first; by which the poor plunder the rich..sudden and violent; the second, by which the rich plunder the poor, slow and legal. - John Taylor

Frazz.
'Stale pale male'. Sexiest comment

Sure is Kezza - but then I am a stale pale male - que outrage comments bang on.

Wow you had me fooled. There is no way I would have thought you were a bloke.
It is still sexism and still not acceptable.

Yer Im vegan too..just to make you choke on your bacon.

No one would ever have guessed.

So you do have a sense of humor! I was starting to wonder.

My wife is a vegetarian and has been ever since I've know her. Guess your 'choke on my bacon' comment falls flat on that.

What you don't eat bacon..how can you call yourself a man?

Childish and not even close to what I said Frazz.
With that comment I call BS that you are a bloke as you claim.

.. but are you sorry you are a man ?

I don't often say it. I'm sorry for being a man right now, because family and sexual violence if perpetrated overwhelmingly by men against women and children.

David Cunliffe speaking at Women's Refuge Symposium.

"I'm sorry for everything I cannot control"

Economists circa 2020

Why narrow the timeframe?

Economists period.

18
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Winston Peters wasted his time blocking the CGT. Nobody is thanking him for it

Nice bit of humour to start the day.

CGT was not a solution, merely a knee jerk response to escalating house prices and a belief it was unfair on first home buyers etc. It would never have addressed the real causes of the high house price/low income problem which has been caused by poor coordinated Government policy on immigration, foreign ownership and lack of social housing investment. We need to get the basics in balance.

I have heard that AOC's most skilled ability is her ability to self promote; from her time in the coffee shop until the present. Haven't seen or heard anything to contradict that lately.

10
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AOC. An impressive speech. From a policy perspective hopefully she gets no where near the levers of govt. I would not describe her as a liberal but a raving socialist, probably to the left of even our Greens. Sometimes known as Alexandria Occasional Cortex.

She's not quite there, in that she advocates BAU but sustainably-tweaked. The problem is that such is not possible. Secondly she is advocating a monetary system closer to one which fits a finite planet, but still not there. Thirdly she advocates 'rights' and without limiting 'per head' consumption, rights are meaningless.

But she's hell-and-gone closer to where we have to go, than those sorry bleaters for the past (which advantaged them-temporary-selves).

16
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National is down to 25% in the polls. Brownlee called the poll 'rogue' when this was bound to happen with Collins at the helm. The fact is that she is not liked and the polling reflects that.

National has also put up signs across Christchurch with Brownlee's face. Given how much he is hated in Christchurch after the failed rebuild that shows a real lack of wisdom.

Two polarising MPs that push voters away from National. I'm interested to see who the next leader will be.

"...this was bound to happen with Collins at the helm. The fact is that she is not liked and the polling reflects that."

So why did she get to 14.6% as preferred PM from Bridges 5%? And marginally higher than the one poll for preferred PM Muller (13%) was in the hot seat for.

A pair of dead possums would have rated higher than the last two contenders. Survivors' Euphoria explains it. "The Party is still afloat, let's celebrate whatever kept us going!"

The only question is whether National can keep this at a 1999 election result, rather than a 2002. 1999 might be more likely, looks like the last dance for NZ First.

'Possums in the headlights' would describe this COL at the moment.
Months to get some real inovative projects going and all that comes out is typical National projects. They are just floundering arround clutching at straws. The power project that they are going to spend $30mill on looking into and the roading are fine examples.
BS smoke and mirrors PR spin at best.

Because the National base like her more than Bridges, they always have.
The problem is the other 80% of the population.

It is kind of sad isn't it. There's 25% support for National but only 14.6% support for her to be PM.

Pragmatist - those aren't incompatible. Low and lower.

As usual grudging (at best) analysis from the website publisher about the usefulness of gold as an investment tool (when did I last see him bang on about the inflation matching component of any other asset class?). Never mind - a simple perusal of the table on the main page of Goldprice.org reveals an average 11% annual return for gold since 2005 (in A$ - in NZ$ it would be broadly similar). Not too many other asset classes returning that since 2005........

11% per year? That's amazing.

11% pa in the 15 years before today - sounds good. But where did it go for the 15 years before that? Nowhere! But call it 5% pa for 30 years if you choose that time frame. Or even better. Take a snapshot just 5 years back to 2005 and what do we see?
https://goldprice.org/gold-price-usa.html

2005 - 2020 nicely encapsulates the era of QE (OK so QE started in 2008/2009 but useful to capture a few years prior). QE will now never end - but I guess you can lead a horse to water etc.........

That same horse that in 1980 called out in the London dealing room is was working in "If gold ever gets back to US$600 p.oz, buy it with your ears pinned back!" ( it had just rocketed through $800.)
VERY soon after it did go back to $600, and during the ensuing 15 years it went through $500, and $400, and $300 and was on its way to $200 ( $253 the bottom? All because "The financial system has changed ".
There's nothing new under the Sun; nothing. It's all been done before. It may have a 'new' name, but we've all been here before.
Are we at the 'new' "$800" level for gold? Time will tell!

Your math is correct. But to get that, you specifically needed to only buy on May 27, 2014 and sell on (or hold till) July 24, 2020. Any other variation of that will give a [much] lower result, including dollar-cost-averaging.

??? The table is the annual (and average annual return of gold) since 2005. Back then gold in NZ$ was $600/oz. It's now $2800/oz. My maths is pretty bad but that looks like a +10% average annual return over that 15 year period.....(which is all I originally stated). It would be the same pretty much in any currency since the 2005 start date in that table (which is the one I originally referenced). I am not sure why you had to fixate on May 27th 2014........

Gold is a hedge against uncertainty, production costs are far below current price, and if the price stays this high for several years there would be enormous increases in economically viable ore bodies or expansion of existing production. All of which tells you that the price will inevitably fall back in future, so be careful how you juggle those knives.

Silver 3% up today so far.
It can not be ignored.
Edit.
Sorry 3.7%, it went up .7% in the time I took to write the above.
Edit.
Up 6.6% today had to stake my eyes off fir 20 mins to do the school pick up.

And yet still so undervalued compared to other asset classes

A 40 to 1 ratio (silver / Gold) is still high. It would take it to aprox $50USD per Oz.

24
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Ocasio-Cortez is dy-na-mite! And despite what some of the comments say above, this is not 'off track' in any sense. Her concerns about structural power imbalances cut to the core of the issue - that politics and economics are intra-related. I've been away for a while and have come back to discover the same name-calling (Socialist! Liberal! Communist!) as before. What such comments do is distract from the issues at hand, in exactly the same way that Yoho did. Not by actually engaging or arguing, but by assuming that bullying behaviour is acceptable.

So I'm calling it out. A great deal of the regular forum contributors here think that it's alright to regularly call people socialist/communist etc. As a relatively new contributor I've been appalled at the culture of this forum. I came here to seek some actual debate, consider arguments contrary to my own, be challenged in my thinking etc. What I find is the same tired old lazy comments but very little real critique.

Mā te wā.

Communist.

Is that the only word you recognised from his comment?

Now that was funny.

A slippery slope in 2020, but that was the intent.

Cheers mate!

10
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Ideology rules Penguin, but if you can look past this there is often some very good quality debate, even across ideology boundaries. True some can't help name calling, but get past that, challenge them if you will on it, but dig out the message. Always remember that name calling is a reflection on the individual doing the calling, not their target. Oh and don't be too precious.

100% the last sentence.

I hope you will stick around Jolly - your comments come as a breath of fresh air as can get very stale in here some times (myself included).

So Frazz you dont like the 'communist' label thrown around but quite happy to make 'pale white male' sexiat comments yourself. Ironic.

Long piece of string you have there Kezza - Communism is a social political movement. Its aim is to set up a version of society based on the common ownership of the means of production and would not rely on social classes, or money. - perhaps you should first understand what communist means?

OMG. I give up on your twisted whatever you have got going on.

So the definition of Communism twisted you up...? Maybe head to the library for the day.

NZ is just "Pale and Stale", there are no shortage of white women on boards and in parliament.Try and find a Maori/Pasifika director/CEO of an NZX listed company though, it's like a game of "Where's Wally".

..equality of opportunity does not equal equality of outcome.
Any business who makes priority out of diversity over competence and skill is doomed to fail (only govt depts can get away with it).
If you really believe in this rubbish, then next time you are admitted to hospital how about you refuse treatment unless it's from a gender neutral non white?

You think Corporate NZ are competent? Fonterra, CBL, Air NZ, Fletchers etc etc There are some incredibly well educated Maori and Pasifika talent but they are pretty much locked out. Probably didn't go to the right school or are not members of the right golf or yacht club. 63% of S&P500 companies have an Afro-American Director, in NZ about 3% have a Maori or Pasifika Director.

Is Fonterra a Corporate - I thought it was a co-op. ;-)

I don't mind being called a socialist when I say something in favour of a socialist policy.
What's dumb is when it is used as a meaningless, reflexive insult, a placeholder if you will for the insult that the commenter would like to use but knows would be moderated out. I like that the discussions here are *mostly* quite grown-up, and using these kind of labels inaccurately doesn't aid the conversation.

If "socialist" or "communist" is the only thing someone can say to argue against your point, that just shows they don't have any real arguments. No intelligent thoughts on the matter. Some people would never admit that they were wrong, or that someone else was 'more right'. Ad hominem attacks are a similar indicator of the lack of intelligent counter-arguments.

Most posts in these columns are merely expressions of confirmation bias.

Yesterday the Government announced plans to build two new hydro dams for the purpose of increasing the renewables level of NZ energy, and to reduce the cost of electricity to NZ households. One hydro dam in the South Island NZD $3 billion and one in the North Island NZD $4 billion. They didn't say how much power prices would be reduced by. My guess 10%, but you will have to wait till 2035 for it. The hydro developments would be completed by 2035. So no reduction in power price until then.

The NZ Government could install grid-tied solar PV on 68,000 state houses now at a cost of $360 million with an annual benefit to welfare beneficiaries of 30% cut in their power bills immediately

The NZ Government could provide a 100% subsidy to install grid-tied solar PV on 1,000,000 residential houses, excluding high rise apartments, for approximately NZD $4 billion in total with immediate effect of a 30% reduction in household annual power bills

How much has been thrown at tourism, airline, airport, hospitality and Queenstown

Agree. They are using tax payer money to build something that they are going to charge us for.
By simply paying the interest on loans of solar installations a by far greater benefit to the community would occur.
This happened in germany and the uptake was quite large and the benefits huge.
Labour and the Greens not rowing the boat in the direction that they claim to be.
This COL has had months too come up with plans and this is what we get, hardly the new and innovative build it back up again as 'green' as possible as their PR spin is telling us. Knee jerk idea at best!

They are using tax payer money to build something that they are going to charge us for. - so you are against roads and motorways as well?

Your logic is out the back door Frazz.

"They are using tax payer money to build something that they are going to charge us for." I would beg to differ? Do you not pay MV Rego fees?

Not to mention the environmental impacts of hydro schemes

The Green / Labour PR spin machine is second to none.

"Green / Labour PR spin machine"= most of NZ media, stuffed to the gills as they are with uneducated/naive 20-something media grads parroting the propaganda of their tribe.

Haha. And National/Act/NZ First PR spin machine = most of NZ media stuffed to the gills as they are with indoctrinated, misogynist bigots parroting the propaganda of their tribe.

Disclaimer: I don't support any political party. Only wanted to offer a balanced perspective.

Pretty minor in the case of the Onslow scheme in central otago. High plateau in the middle of nowhere, dry barren landscape, cold, very low population density.

Still an ecosystem that will be destroyed.

For 85% of last 100k years ago Lake Onslow has had annual average temperature below zero. Likely glaciated, otherwise permafrost. And likely will be again in a few thousand years as Holocene draws to a close. Earth doesn't seem to care much about that ecosystem.

May as well mine Antarctica then.

will not make our resident penguin jolly ..

So infact the environmental impact will be huge on such a landscape. I love dams and hydro and stuff they are awesome. But where ever they are done the impact is HUGE.

So just ignore everything downstream of the dam?

the Clutha River at roxburough averages 600 cumecs, swinging daily from 400-800, with little seasonal variation as it follows NZ day-night demand and annually with rain and drought. Heavy rain can see it spike as high as 3000. Taking or adding 200 cumecs seasonally for pumped storage won't have much impact, and minimum flows can be guarded against using existing dams.

In California it is compulsory to install Solar PV on all new-home-builds

Roof top solar is really cost inefficient ~3x the cost of utility scale PV. Govt should not invest in it (poor bang for buck). But for home owners it does make sense as retail electricity cost is 3x wholesale due to transmission fees.

So you're saying roof top solar actually is cost efficient after accounting for transmission costs?

It's marginal for home owners in sunny parts of country as still have to pay large connection fees to electricity suppliers to keep lights on when the sun doesn't shine. In 5 years cheap batteries and autonomous EV's (that can go and get a few days worth of electricity for your home in bad weather) will likely change the economics forever in favor of rooftop PV, and scale of that change will make rooftop PV installation a lot cheaper (due to learning curves of bigger industry)

"In 5 years cheap batteries and autonomous EV's ..."

Wasnt that 5 years ago?

We were to have flying, however cars at the moment.

Despite that the Dutch Government has put it on to the roof of all their state owned houses, and I understand it is compulsory for all new builds too.

Triumph of virtue-signallers over economic sense - if they were rational about going renewable they would spend same money on getting 3x as much PV power generated in utility scale schemes. Best intermediate option is putting it on factories, farms and warehouses with their larger capacity grid connections. Also Holland and rest of northern Europe is a dumb place for PV. Spend same money in Spain and ship 2x as much electricity North.

Ah yes Foyle but I feel you forgot to factor in climate warming.

yes - and it is causing all sorts of problems and unhappiness. People simply hate those over-isolated new builds - way too hot in summer etc.

I think this is a great move. Enables GW scale PV installation (which we need a lot of as we need to expand our average grid generation by 3-4GW to go fully renewable and support likely shift to lower total cost of ownership EVs in NZ in ~20 years. GW scale PV is now just $0.02/kWh in Qatar, likely $0.04/kWh in NZ, which is just half of our current wholesale prices but need seasonal storage. These pumped hydro schemes will likely reduce NZ's cost of electricity as well as enabling fully renewable and saving us billions a year in fuel imports in long term.

It's instant job creation

Utility scale PV would be a very good way of creating a lot of jobs in much of provincial NZ. No subsidies required. NZ might even be large enough to justify establishment of PV and battery production in NZ - more local jobs, grow manufacturing base, and less money spent on imports.

My preference is to see a distributed network "owned" by individual householders so their costs going forward are fixed and not subject to the larceny of the gentailers. i should also mention the importance of reasonable FIT Feed-in-Tariffs which makes it worthwhile for grid-tied systems while battery storage installations are a more expensive consideration. The greatest advantage of grid-tied is for people who are at home during the day and can use their generation for both their EV's and household needs, whereas those who are at work during the day will be better served by battery storage and charge the EV overnight, sending any excess to the grid during the day. Right now the FIT's are miserable. In fact they are a dis-incentive to private installation of PV, which is a protection racket for the 51% government owned gentailers. Currently much of the major solar PV farm developments are existing gentailer owned not private

Private grid tied solar power is totally financially inefficient. It may have a "feel good factor" but that's all. The Govt calcs are (like most of their costings) complete pie-in-the-sky. As a low user of power (around 700Kwh/mnth) I pay about $2400/yr. Given a generous estimate of 50% generation time,for a 30% reduction I would need a system capable of generating 200+Kw/mnth, so you're looking at something like a 10Kw system. Total installed cost.. $21K (as at April 2020). Cost for the 68,000 SHs = 1.4Bln Cost for 1,000,000 = 21Bln. Those costs don't include Council consents, retailer admin fees or new meters.

Is that deliberate mis-information?
Check the annual number of sunshine hours for your region
Last time I checked the lowest region in NZ was 1500 hours annually
The best region is 2900 hours annually
You could meet your needs with a 4kw system generating 6000 kw annually
A 10kw system would produce 15000 kws annually at worst

Unless you have panels mounted on tracking systems (which most rooftops aren't) you only get maximum generation at 180 deg deflection. That's why I used 50%. Using sunlight hours is useful as an estimate but actual generation/hr would be much lower than the rated o/p of the array on a fixed mounting. NZ receives, on an all region average, about 1800hrs/yr of sunlight. Fixed roof mounted PVs don't stack up financially unless you're going to stay in the same house for a good length of time (about 15yrs), by which time they'll be due for replacement. Sorry icon but that's just how it is.

I had a fixed 1kw roof-top solar PV system in Melbourne where the annual sunshine hours were 2000. On a long day got 9kw out of it. Reading the above is why NZ needs to subsidise it and pay reasonable Feed-in-tariffs. I have been watching Harrisons for 5 years. Their price for a basic system has remained static at $5,999 for the 5 years. Hasnt changed. Haven't looked for a while - it may have come down

I was using NZ prices and NZ av. sunlight hours. Melbourne is a few degrees closer to the equator, with a dryer climate than us so it may stack up better there. I'm not against PVs by any means, all I'm saying is that in NZ they don't really stack up for private use. Large industrial scale arrays might be a different proposition. Besides part of my post was the wildly inaccurate claim by govt of installing 68,000 systems for 360mln to provide a 30% immediate saving. complete bunkum

So your 9Kw @ about 28c/Kwh saved you the grand sum of $2.70 for a good day. So it'd take over 6yrs to pay back if every day was a "good long day"
As I said earlier private PVs don't cut it economically.

Sigh - comprehension is wanting - prefers to attack rather than ask questions
The 1kw system was installed in 2005. Was a first mover. With a Federal Government capital cost subsidy plus a locked in 25 year guaranteed export Feed-in-Tariff of $0.66 per kw exported I didn't pay 1 cent for power for 9 years until selling and returning to NZ

There is also the environmental cost of producing, installing, maintaining and eventually scrapping a million spent solar systems. Its actually not really a great long term solution.

Ozzy CBD price collapse.
Much the same is going to happen here. With the decreased occupancy and rent returns the owners and they will be looking to find an alternative income.
The Councils and Govt will also be concerned at these areas becoming nonproductive and approve whatever when in reason to keep them afloat.
Fit outs into apartments would be the easiest and fastest means and ticks the housing market shortage box.
Private enterprise is about to fix what the Govt has failed to do.

21
up

For every thing going on in the world our big weakness is housing. I have a friend with 13 or 14 houses in a low income area, he just put all his rents up $50pw to help pay for new housing regulations.
The housing market in this country is impoverishing people, it's a disgrace that labour have sat and watched this unfold with no action.
He is charging over $400 a week in a provincial town. I asked him how people can afford it, he said " that doesn't matter because the government pays with the accommodation supplement anyway".

Is he old-money with 100% equity or one of the more recent leveraged guns

That is an example of the landed gentry who screamed the loudest when Graeme Wheeler of RBNZ proposed treating investors who owned 5+ properties as businesses, and charge business interest rates on borrowings.

he's not landed gentry, got into rentals about 15 years ago.

What do you personally think the government should do?

They should do something like they promised at election time

Thanks, now I'd like to hear what Andrew thinks.

asset tax and restrictions on debt to income etc.

I'd like to see them actually get something they say off the ground, instead of say, try, fail then spray it with lavash amounts of PR spin.

The Government subsidising landlords! This is where the Government could address a whole lot of issues in one hit.

This COL can't do anything well or come up with new ideas but still they spin their PR that they are wonderful. It's bloody staggering.

National couldn't and wouldn't either Kezza. I agree it's staggering. I'm not sure wht it will take to motivate the pollies to act. Perhaps they learnt from Key - 'manana' (Brian Easton's allusion)

Unreal that everyone sits back and plays the my team v your team.
What we should be doing is, holding them all accountable.
My team is crap but its better than your team is what we accept. WTF is wrong with people??

Expect more spin and less results from future govts. This Coalition have proven decisively that accomplishment of anything is unimportant - failed at pretty much everything they have tried and yet are riding at 60% in polls due to very effective propaganda machine (aided by sympathetic media). Politicians now know that the propaganda function of govt is all that matters.

Spending or promising lots of money buys you a lot of feel good support.

14
up

“I have a friend with 13 or 14 properties” is the problem with our society.

Labour and the Greens just added 107 more houses and we should be thankful but one indervidual supplying 14 rentals is bad.
What we need to look at is the National and Labour failures.

So one individual owning 14 is bad but 4 individuals owning 3 or 4 is OK? Or 7 owning 2 each even better? I don't follow your reasoning. The landlord is supplying a service, nothing more.

I agree, should be a question mark in there.

Is the landlord doing nothing other than supplying a service? If he owns 14 properties, that's 14 which aren't on the market for those who wish to buy. The argument that landlords are providing a service is specious at best. It can only be made if they are charging an affordable rent that does not require a Government subsidy. This would peg it at about $150 - $200 per week for a whole house. Beyond that they are just being parasitic. And therein lies the clue to what the Government could be doing about this.

Parasitic or merely astute investors who are encouraged to invest in this matter due to Government policy. I wish we had better policy making that thought the issues through more fully and widely before implementation.

What exactly do you expect the govt. to do about it?

Are we ready to let go of our beliefs/fears about land "values", property wealth, private property rights and whom is deserving of a home?

The "market" doesn't have a solution but we keep supporting it. We decry the political parties for not putting out the fire but we keep fuelling it. We demand somebody else fixes it but only if the solution doesn't mess with our entitlements to capital gains and wealth. According to our prophet economists that's rational self interest... the mists of delusion is probably more accurate...

Flicking thru the World financial news websites , while eating my sandwiches , I can only say that the world economy is slowly dying .

Its like a slow painful death from a cancer overtaking a person and which leads to secondary issues , until everything fails .

The whole thing is unprecedented with no solution in sight

All good, Labour has got this... LMAO hahahahha.
We are in for the biggest Govt screw up NZ has ever witnessed.
I was going to say there is only one silver lining ' Labour and the Greens will poll so low in the election after this one, that it will take 20 years for the public to forget' BUT National will be there waiting to open the door to the CCP.
YEP screwed one way or the other.. OH JOY!

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