Here's our summary of key economic events overnight that affect New Zealand, with news corporate social action plans are under the microscope today.
But first, the warnings we have been reporting earlier this week keep coming in the US. Now the February durable goods order data shows them -1.1% lower than for the prior month, and that is a worse outcome than the +0.8% rise expected. It is also well down from the +3.5% rise in January. Year-on-year at least it is +2.3% higher. Companies are investing however; non-defense capital goods orders are a strong +13% higher year-on-year.
The more up-to-date March data for PMIs is fortunately more positive, indicating a continuing moderate level of expansion for both manufacturing (59.0) and services (60.0). New order growth is the best since 2015 and new export orders are part of the reason.
In Europe, this same survey suggests they returned to an economic expansion in March for the first time in six months. This was led by factories, especially in Germany. The German service sector was one of the few majors to expand.
The long-term negative European consumer sentiment eased somewhat in March.
In China, the world’s largest clothing brand, Sweden's H&M , is under assault there (one of its biggest markets where it has over 400 stores) over its commitment not to buy cotton produced in western China made with forced labour. Beijing calls this 'politics' and they have 'organised' boycotts and protests. H&M's stance started over two years ago, but the pushback is only starting now that international pressure is building.
We regularly report on the Taiwanese economy, and most of their economic benchmarks have been quite impressive over the past few years. But that may not last; they are in the midst of a severe drought, one that will start affecting industrial output soon.
The 'flash' PMI for Australia has been released for March showing a survey-record increase in input costs, with higher prices for a wide range of materials and a spike in shipping costs. But new orders are rising as the pandemic restrictions abate, and employment is rising as a consequence.
And staying in Australia, the ANZ Bank is under pressure as the "worst" bank for financing fossil fuel projects, despite it being the smallest of their big four banks. ANZ made a big deal about exiting this type of funding last year, but it's declared pace of retreat is the slowest of any local bank.
On Wall Street, their Wednesday session is up +0.5% in early afternoon trade. Overnight, European markets were mixed with London posting a small gain and Frankfurt retreating. Yesterday, Tokyo ended with a large -2.0% loss, and Hong Kong had the same heavy -2.0% retreat. In Shanghai they ended with a -1.3% loss. The ASX200 was up +0.5% but the NZX50 Capital Index was down -0.3%.
The latest global compilation of COVID-19 data is here. The global tally is still rising and at a fast pace, now at 124,430,000 and up +562,000 in one day. Global deaths reported now exceed 2,738,000 and +11,000 in one day. Vaccinations in the world are rising fast however, now up to 476 mln and in the US a third (127.1 mln) have now had this protection (+1.7 mln) and they are achieving a very fast rollout. The number of active cases there fell yesterday to 7,050,000 (-129,000 in one day), resuming the reducing trend and taking the number currently infected down to 2.1% of their population.
The UST 10yr yield is down -2 bps at just on 1.62%. The US 2-10 rate curve is only marginally flatter at 149 bps. Their 1-5 curve is also just marginally flatter at +76 bps, while their 3m-10 year curve is unchanged at +163 bps. The Australian Govt 10 year yield is also down -1 bp at 1.71%. The China Govt 10 year yield is down -3 bps at 3.22%. And the New Zealand Govt 10 year yield is down a very sharp -17 bps to 1.53%.
The price of gold starts today up +US$8 in New York at US$1735/oz.
Oil prices have recovered today, up +US$2/bbl and are now at just over US$61/bbl in the US, while the international price is now just over US$64/bbl.
The Kiwi dollar opens today even lower at 69.9 USc and down by another -¼c, and now well outside the long term 71c-73c range it has been in all year. Against the Australian dollar we are holding at 91.7 AUc. Against the euro we are also holding at 59.1 euro cents. Today's shifts are all about a rising greenback. That means our TWI-5 opens today marginally lower at 72.3.
The bitcoin price will start today at US$55,930 and up just +0.8% from this time yesterday. Volatility in the past 24 hours has been high at +/- 3.4%. 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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126 Comments
Move over Bitcoin, Artists have the last laugh now with NFTs! :P Wall Street Journal article: https://www.wsj.com/articles/nfts-are-music-industrys-latest-big-hit-11…
That and the shoe-shine boy indicator of the 21st century - children's Sharesies accounts and a 9 yr old's owning property https://www.businessinsider.com/how-to-spot-stock-market-bubbles-2017-1…
Oops my mistake, 8 year old boy https://www.nzherald.co.nz/business/eight-year-old-boy-snaps-up-investm…
NFTs are like any new tech bubble - they'll blow up and then settle into their daily use case. Ironically with the comments above, NFTs are ideally suited to something like property, where a token proves ownership of the unique asset. That's where the future value of NFTs lie, doing the heavy lifting in the contract space. No more real estate agent escrow accounts, expensive lawyer contracts, and deadline sale triggers managed by a trusted 3rd party - everything will be baked into the token that enables effortless transfer of ownership based on the agreed rules of engagement for tens of dollars. It'll probably take 10-15 years, but it will happen.
Absolutely correct that this house does not help much to FHB though tax change is a good first step but it should and has to be followed by restriction on Interest Only Loan and than see, how it goes as give more high risk buying power to speculator, which should have been acted upon earlier or asap - better late than ever.
https://www.newstalkzb.co.nz/on-air/heather-du-plessis-allan-drive/audi…
Tax Change to bring parity between investor and owner occupied house is good but to stop speculator from speculative buying, it is important to cut their source of cheap and easy money through Interest only loan as by restricting it, will be reduce speculators buying capticity, which is a know fact and bound to achieve results in favour of FHB in future buying SO why no action and urgency shown by Jacinda Arden Government to instruct RBNZ.
Would like to see detailed article on it and if can get response from government will be great as nowere in media have seen any journalist raising it with government, which could be a game changer.
Pretty sure it's common for other businesses to take out business loans, pay off the principle amount, pay GST and conform to health and safety requirements to name a few. If residential property investors were doing the same, then I will concede an argument for the same benefits around deductibles that other businesses enjoy.
Previously there was an incentive to NOT pay off any principal on a loan. They have removed that incentive so I am not so sure that interest only loans are such a big deal now? Only anecdotal but as soon as deductibility is gone we will be paying the residential investment debt off quickly, was interest only beforehand (as was beneficial to pay off any OO debt or use the money elsewhere)
To be fair, the decision on interest only loans may be waiting on outcome of cooling affect/assessing IQ's of average specuvestors and their appetite for risk, post-announcements. My guess, given the denial and "we will just raise rents" attitude, the implications of the interest-deductability change will take too long to sink in, and interest-only will be removed come May. The beatings will continue until specuvestors pack up and p*ss off
Agree
INTEREST ONLY LOAN = TOOL FOR HIGH RISK EASY CHEAP MONEY TO SPECULATORS
Very obvious and best option to try but still Mr Orr needs more time till May but why? what is it that he is waiting upon that will make him decide as if price rise by 10% in a month is not goid enough.
Mr Orr too should be held for accountability.
Interesting to see Michael Reddell's ruminations re housing, interest deductibility, emerging differences in tax treatment of small vs large; equity vs debt etc. The title says it all: 'Messing Around with Housing'. And the conclusion is as always - treating the symptoms, not the cause.....
And this Stuff article introduces another unintended consequence: investors will compete directly with FHB for new builds......guess who has deeper pockets....
Reddell is just another economics-blinkered pontificator. I always wonder what these folk think when they have to fuel-up their cars.
"
He gets close with " at the best alterative use (mostly farming presumably)," but that falls a long way short. Trying to address a lack-of-remaining deck-above-water by making deck-space 'cheaper', won't solve the Titanic's problem - but it does provide a fine example of how examining one facet in minutae, can get you a long way down a dead-end thought-path.
A more encompassing, thought-provoking piece:
https://www.jonathan-cook.net/blog/2021-03-23/fear-police-protest/
"This sane minority is treading the vanishingly thin line between alienating the majority and averting oblivion for our species. As the stakes grow higher, as awareness of imminent catastrophe intensifies, those wishing to make a nuisance of themselves, to be noisy, will grow."
"What we decide now determines how that struggle plays out: whether we get to take control of our future and the fight for our survival, or whether we are forced to stay mute as the disaster unfolds."
Not so
The Inland Revenue and the Accounting profession recognise that interest costs are attributable the nature of the expenditure. If the expenditure is of a capital nature the cost is capitalised and not deductible. Ring fencing rules are a partial acknowledgement of that in that all interest costs in excess of the rents received are not deducted for tax purposes, are capitalised, and carried forward against the eventual sale
The current buying frenzy clearly evidences that buyers are investing in capital gain and not rents
How many businesses produce operating losses year on year and doesn't make anything at all until the underlying asset is sold? Arguably, that kind of business has no merits as a going concern and is basically just functioning as a hedge against inflation - on the off chance you hold that asset long enough for it be profitable, which most won't. I'm sorry, but the enormous social costs of this kind of investment warrants it being singled out for special treatment, just like we do with smoking, gaming machines or any other excise-worthy product.
"Can you imagine a world without lawyers?"
No, I'm saying coddling one type of investment class that every Tom, Dick and Harry thinks is their pathway to retirement that generates massive social costs that the general public has to pay for is unsustainable and dangerous. If I thought there should be no landlords at all, I would have used the words "there should be no landlords at all". You'll notice I didn't do that in my post.
If only we could tax property investor insecurity, we'd be able to build all the state houses we could ever need without incurring any extra crown debt whatsoever.
Are we better off as a country today with more investment properties and fewer owner-occupiers (proportionally) than in the past? The direction of travel has been pretty clear moving from owning to renting over the last few decades.
I don't think many would say houses shouldn't be available for rent, but it's not crazy to think the segments are getting out of whack and some government intervention is justified.
With respect to the size of the infrastructure fund - Bernard Hickey interviewed on TVNZ pointed out that we need to compare it to the annual costs of emergency housing + accommodation supplements which combined are greater than that fund amount!
The cost-of-living is just too high. Where accommodation is concerned, we have to regulate the private sector rental market - TINA. And the government needs to rush to build (or buy and re-purpose) multi-story apartment-style tenancies, particularly for small households and retirees (and anyone else on a fixed lower quintile income).
Agreed Kate, which results in Kiwis putting of things like having kids and having fewer of them when they do. Instead of addressing the drivers, the government just imports more population, doesn't stump up for the infrastructure needed to house them, and things get worse, and the whole cycle repeats over and over again. Maybe we should be asking why Kiwis are having fewer children, rather than using it as a launching pad to greenlight higher levels of migration.
The number one driver over the last decade has been too many people through too much net migration. At the moment Covid is taking care of that problem.
The low interest rate effect has probably played out, now that all the cost savings have been capitalized into higher prices and they don't have room to move much lower.
Investors are a significant part of the demand. Mortgage lending up about 2 billion February 2021 compared to February 2020, with 0.7 billion of that from investors. There are moral differences too - if you stop an investor buying a house, they find something else to invest in. Maybe even something productive. If you stop a FHB buying a house they are unable to settle, maybe move abroad, maybe delay starting a family.
This is it. "Investing" in housing is not true investment. Which involves productive industries, you know, actually making a product or service and selling it to generate profitable cash flow.
"Investing" in housing in the way we have in this country has the opposite effect of productive investment, it significantly reduces economic mobility, it heavily restricts capital available for growing productive businesses, it reduces the ability for workers to live fulfilling lives causing all sorts of social harms both short and long term, it reduces the ability for people to start new businesses because they are paying too much for mortgages or rents and it creates a monster in our financial system which becomes "too big to fail". All in all, the type of investment we have created with the housing investment model in this country has been destroying our short and long term productivity potential for the past decade and a half and the effects amplify the longer it continues. While at the same time putting our entire financial system and economy at risk WHEN there is a downturn in the industry (whether this is an internal shock or external).
No, again you are taking it to the extreme.
The government has set the playing field, for years this has been tilted in favour or investors (both professional and unprofessional), or those that already own property, to be able to leverage that property to gain more properties. While at the same time they have allowed lots of immigration, not built enough houses, not allowed effective zoning laws and allowed the cost of house builds to skyrocket. ALL of these are factors, not just some of them. This has created a self fulfilling situation where property has become more and more concentrated (note the stats on home ownership rates), pushed up prices and has resulted in huge distortions and massive barriers to entry. Nobody really wants to address it because of the powerful lobbies out there who are generally older and who generally vote more are making mega bucks off it.
House rental industries can definitely exist, in this country however it has become more parasitic than other places around the world, where they are strongly regulated and highly professional businesses. Here it's cowboy land (you only have to see the news articles on what is being rented out or ridiculous rent raises or landlords doing stupid stuff), poorly regulated and mostly unprofessional people running it. I can say this from the evidence we see everyday in the news and from personal experience.
What you describe sounds to me like a Zombie company. Amazes me how someone with an investment property suddenly see’s themselves as a business operator/entrepreneur. If you work full time running your property portfolio, which some on here are doing then yes it is a business, but not for someone not doing this they are simply investors. I think there needs to be much more clarification in this space. Can’t blame people for wanting an investment property or two as it’s been the way to get ahead for the last 50 years of this current debt ponzi scheme.
Oh, I can't blame people for taking advantage of a shitty tax and regulatory situation, but I CAN make fun of them for melting down and having a whinge because the things that were suddenly overwhelmingly stacked in their favour are now just slightly less so, after decades of them mocking my cohort for 'not working hard enough'.
Maybe cut back on the Netflix, iPhones and flat whites and then see how you get on?
Hey specuvestors, tomatoes are going cheap!
I wonder if ASB will change the tone of it's home loan ad campaign to stop mocking Buyers. No longer use the term 'first home buyer', a label used to describe the small marginalized beaten-down creature, now nationally endangered
GV27 - Totally agree with you 100%! The point of the latter part of comment was that it is the proven get rich quick no brainer scheme. Investors think they are doing nz’ers a big favour by buying houses and renting them out. Bankers, Governments and buyers and worked in tandem to push up prices to ridiculous levels. This will end badly as the level of debt and high cost of living, inc rents leaves little money to be spent into the economy. This will lead to a very unpleasant recession. We are about to head into a double dip recession. You can only run a country on the wealth effect of high house prices for so long. You need real money generated from increased wages and reduced living expenses to grow an economy safely not the paper rich debt based system that we have now.
I've seen the argument in a couple of places that removing the income deductibility will leave investors stranded and maybe even defaulting on their mortgages. If only they had access to some kind of asset to sell, which had recently appreciated quite significantly..?
Regardless of whether the changes are fair, there is lot of exaggeration over how devastating the impact will be. 99.9% of investors should be sitting pretty right now and can easily sell if the ongoing numbers don't work for them.
Landlords purchased a lot of property the last 12 months - a significant amount at maximum LVR. Those loans will be marginal going forward and any rise in interest rates will see them underwater. If they're new investors, then I don't see any option other than selling. If they pool their new purchase with other older rentals, then I guess they could carry the loss and hope for capital gain to cover the loss.
Yes - the worst outcome in most cases in selling for 10-20% high than they bought, and having to pay some tax on the profits. Not exactly devastating.
There will of course be a few very recent, overstretched investors who may get burnt. This is always the nature of bubbles.
It's almost like literally every single investment class has risk, but snowflake investors think they shouldn't face any risk at all.
Which is wild, because if they're so worried about *making lower gains* on exit, AND they're running at a loss during the time they're operating as a rental property, then it sort of begs the question "Was this actually just taxable speculation the whole time?"
its that annoying piece of paper that says they own the bank $500k that's the worrying part....
wait until the stories start of banks tightening their lending policies ,couples losing their equity begin, cant roll over loans, cant pay their tax etc
then we will see how long term these long term investors are
I can see interest only loans going next and then its really game on
I agree. The rort is no CGT allowing people to divert the expense side of things to reduce their tax and keep the profit to themselves. That is simply mad. Bring in CGT (and I guess you will need to keep the ringfencing requirements in place as well) then it will be fair and square.
Robert Kiyosaki refers to this as DUMB. Why would you want to own a property that does not provide you with a decent income! He looked at buying property in Australia years ago. He buys based on the income that can be generated from the property not on the capital gain that is only realised when you sell. He seems to have done quite well with his property investments following this method. The proceeds for his Rich dad books also provide a nice income of $500k/month.
Exactly Gummy Bear! Further any gains from buying & selling properties should be treated as income . This "capital gains" exception is absurd from an accountancy perspective. A capital gain is in effect capital income & should be treated as income.
We now have a situation where we have made an exception on one sort of income (capital gain). This has serious caused market distortions. They are now introducing another exception to try & correct these market distortions (not allowing interest to be an expense). Just remove both exceptions!
The gaping hole is no CG. In presence of CG there is not need to treat interest expenses in any other way. In accounting you capitalize interest when you are building an asset. E.g. during the construction phase of a house or a road. You would never continue to capitalize interest once the asset is ready and in use. Interest expense you pay on a completed house is expense (from an accounting perspective) and would never be allowed to be capitalized.
Ring fencing is needed because of no CGT. In makes no accounting or economic sense otherwise. Because NZ does not tax capital gains, it has to do all sort of silly things to offset it. It also reflect that fact the IRD can impose any tax they like because they simply can.
Which is how it should be.
You make an investment that you KNOW will be cashflow negative.
And then you expect the government to give you tax breaks, to make whole your STUPID investment?
If I borrow money to buy Dogecoin, and Dogecoin tanks, will the Gov't let me claim that against my tax?
How many Landlords pay GST Gummo? It's not a requirement for them to pay GST if it's a long term rental, yet a long term business is subject to GST.
I read all the time that Landlords "provide a much needed service", so why is GST optional? If a Landlord is paying GST then go for gold on writing off expenses.
GST is paid by the consumer not the supplier. Supplier simply collects GST on behalf of government. If landlords are requried to collect GST, that would not have any financial impact on them.
Why are we happy to make any arguments, even if they are absolutely 100% wrong, just because it seems to further discredit something we do not like?
The access to credit (with criteria to such access being 1) future income to repay 2) collateral against the debt) is where PIs have an massive advantage over FHBs. House prices moving up, makes FHBs weaker (their cash deposit % to value reduces) but the PI stronger (if they have 1 house, they move with the flow, any more than 1 and they are much better off). Now if such an advantage was to be removed (very high LVR or simply disallowing equity as collateral for any other house) that would have been an equalizer. if you introduced CGT on top of that, that would have been a massive leveling field.
One source of deeper pocket for investor is Interest Only Loan, which should have been restricted by now but has not been done - why is government having cold feet ????
Not that government is not aware of the benefit of its restriction as is mentioned in their announcement but why once again taking the route of delaying and avoiding by pushing it for further announcement with no action, when was possible through RBNZ as Mr Orr too knows but by himself will never act as his priorities as mentioned by home are different and is government responsibility.
Jacinda Arden is correct when she says, that she does not have a silver bullet, which she will never have SO why not use the best available bullet that you - Restricting Interest only loan.
Just like banning foreign buyer was not a silver bullet but it did help to calm the housing market - gave breather which is needed and current measures though good as first step are not complete without restricting IO loan.
Jacinda Arden wants to put it back but how come as rightly pointed in one of the comment, no journalist has highlighted it and allowed it to get hurried in other noise just as Jacinda Arden and her team wanted and planned.
How about a word in respect of this debacle?:
Kiwi QE Fail: NZ Bond Yields Plunge After Failed QE Operation
I posted this on the BNZ commentary
by Audaxes | 25th Mar 21, 9:21am
The 10-year NZGB fell by a massive 17bps to 1.51%, taking its fall this week to 30bps, outperforming swaps which fell by “only” 15bps to 1.72%
Dealers Finally *Choose* To Sell UST’s, Predictably Market Chooses to Buy All of Them
I guess we aren’t supposed to notice that the rest of the world has been buying UST’s at a furious pace. How else did the yield curve invert in the first place? Sure, the money market fund and other nonbanks like it may have preferred commercial paper or even unsecured LIBOR to a very low UST yield, but someone is buying to push every UST yield lower to begin with.
Not just someone, but a whole ton of someones. To believe in this convoluted theory, you are asked to believe that primary dealers whose entire job is to find buyers for Treasuries are disrupting repo markets and other funding mechanisms because they can’t find enough buyers for Treasuries during a time when there is otherwise so much demand for Treasuries it has upended the natural order of curves everywhere.
MR. FISHER. In summary, I want to mention that, as I said earlier, most of these variations that have been suggested are very un-Bagehot-like. And what I mean by that is, twisting [or QE] entails purchasing assets that investors are fleeing toward, not assets that they are fleeing from.Link
The staggering tone-deafness from some investors sooking in the media last night: "I feel like we're being punished for planning for our retirement".
If that's how you're planning for your retirement, then you're not paying for it - everyone else is. What is it about these people that makes them think that leveraging the gains on their cheap family home bought in the 1980s in inner Auckland to buy three rentals makes them Warren Buffet? Selling a house you bought as an investment doesn't mean the house gets bulldozed and ceases to exist. It's hysterical.
"The family we're charging $800 a week to live in the house would have to find somewhere else to live" - if that family can afford the $800 a week you're charging them in rent (dead money) then they can probably afford to service the mortgage; but it's paying your rent that means they can never get a deposit together. And why are the deposits so high? Because the investor cohort has been using their tax-advantages and ability to leverage to muscle FHBs out of affordable properties.
It's time for the madness to stop. Start unwinding it and finish the job.
I've found that landlords in Nz (not all, but many, or general culture involved in landlording in NZ) has strong narcissistic personality disorder traits. They pretty much tick all the boxes. And yet government after government have been pandering to them...its completely bizarre.
https://cdn.psychologytoday.com/sites/default/files/styles/image-articl…
A tweet to Choe Swarbrick:
"@_chloeswarbrick is painting us all as millionaires. We don't make any moeny from the homes we own".
Her response:
"To take this on face value: If you're not making 'any money' from something (property investing) and that something is causing immense inequality, deprivation, stress and homelessness (the housing crisis), maybe you stop doing the something?"
God help us.
I didn't catch the name on Morning Report, but turned to my partner and said: Ït's a long time since I heard someone enunciating the problem so clearly".
So I listened for the name.
And thought: Future PM. Her logic outclasses our current one, and both are about 100 years ahead of the National rump (even if one of them is taking lessons in sounding like Key - anyone noticed?).
Barfoot and Thompson who run their city auction on Wednesday’s have this live link for sales on their website. https://www.barfoot.co.nz/auctions-live/completed
Not happy with Jacinda Arden's housing policy, though a good start but missed opportunity by not curtailing the source of cheap and easy money supply to speculators in the form of interest only loan.
BUT
Happy to see shouting and kicking reflecting sheer frustration by Mike's and Tony's....Alexander's of New Zealand along with Judith C who does not know what hit her and is coming and how to react.
The National Party is going to find a significant cohort of young professionals who are frozen out of the property market who fully support this sort of intervention, and they won't find that out until they step outside their own, highly partisan supporter base. If that was a viable road back to power, then they'd already be in power.
I think that national party just got their base back - a large number of traditional national voters voted for Labour to stop the greens wealth tax ie to stop a labor/greens coalition. Those voters dont want to be taxed - National have already said they will overturn this weeks announcement so you can guarantee those voters will return to National now.
The young voters if they cant get into the housing market will just leave for greener shores - making the base older and even more likely to vote for National. Dont forget these policies also hurt aspirational middle age voters who dream of one day owning a small investment property and now wont be able to.
the next polls will be the key
I think the concerns of people who aspire to nothing more than owning investment properties should be well down the list of political priorities for National. That kind of attitude is simply out of touch in NZ in this day and age. The National Party has to be a party for taxpayers and businesses, and it can't be that if it wants to perpetuate a system that requires massive government subsidies like accommodation supplements. Just think what our taxes would be like if we didn't have to underwrite these massive programmes just to help people keep their heads above water?
How Hard life would be
Energy supply in NZ is = renewables=40%, Fossil Fuels=60%
To meet the Climate Change Commission target total renewable by 2035 will require the previous 100 years of investment in renewables to increase by a further 150% in 15 years - impossible - won't happen
https://figure.nz/chart/8Vpo6WKVNXqzLhpC
And therein lies the housing problem, and the poverty problem, and the debt can't be repaid meaningfully problem.
As I point out often here (but note the zero take-up from the media) we bet on future energy. We do that because it supplies future work. That once-off hit of Fossil energy, was head-and-shoulders more than we can supply long term, and not only was it leaving us, the burning of it was leaving us a stuffed planet. So lesser-energised we will be.
Some of us have gone ahead and demonstrated lesser-energised, perfectly satisfying lives (not perfect, but don't use that as an excuse to denigrate). The problem is that society at large cannot handle the reduction required, and the forward bets are irredeemable. Folk have placed these bets in pension funds, in house-price rises, in, in. in, - but that's all they were; bets.
Saul's: 'The Collapse of Globalism' or King's: 'When the Money Runs Out' are good background reads. Neither get the physics; both see the inexorable reduction of growth. We haven't had this debate yet, but Kiwisaver bets are the same as house-price-gain bets, in the great scheme of things. And all anyone is doing - from the US to China and all points in-between) is writing more debt.
Trying to put pressure on government has begun by threatining...blackmailing.....
https://www.nzherald.co.nz/business/will-my-sector-be-next-businessnz-s…
To be seen if Jacinda Arden sccumbs to it or rise above and deliver the unfinished job.
Can you hear them sing, Negatively geared investors claim the right as businesses, to full tax-deductability of interest on their borrowings
They want to be treated as businesses, but don't want to pay business rates of interest of 8%
Give them their wish and classify them as businesses and charge them accordingly
At the business rate of 8%, with full tax-benefit, they would still be paying 5%
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