1) Opinion: Depression 1930s style Depressions foster unemployment. In the winters of normal years like 1924 and 1925, about 500 kiwis registered unemployed. Then catastrophe struck; in 1930 registered unemployment was 5,500. By 1931 it was 44,500 and two years later it reached 79,000. 2) Auctions increasingly used to end housing "˜Mexican standoff' Auctions are becoming much more prominent in the current uncertain housing market, being used more widely as a way to end the "˜Mexican standoff' in the market between bargain hunting buyers and stubborn sellers and giving a clearer picture of where real prices are sitting. 3) ASB, ANZ, BNZ and National join Westpac, Kiwibank in rate cuts (Updated) ASB, ANZ, BNZ and National banks have moved to reduce their mortgage rates, following on from cuts by Westpac and Kiwibank on Thursday as the banks move in anticipation of a big cut in the Official Cash Rate by the Reserve Bank of New Zealand on December 4. (Updated to include ASB's, BNZ's cuts) 4) BNZ offers new 6.99% special rate for 6 month mortgage There's a whiff of the 2004 "˜Unbeatable' mortgage price war in the air. 5) B&Brown close to collapse; NZ$1 bln of debt here at stake (updated) Australian infrastructure and investment banking group Babcock and Brown appeared close to collapse on Tuesday morning after trading in its shares was halted until Wednesday and its rating withdrawn while it has further discussions with its bankers. (Updated from newsletter to include ratings withdrawal and director resignations). 6) Opinion: Coastal property under water, flooded by over-supply Often it is only generally accepted that a speculative bubble exists in a market after it comes crashing down (i.e. it must have been a speculative bubble because only speculative bubbles are followed by crashes). However, having seen several bubbles first hand, including angora goats, ostriches, mohair rabbits, the US IT sector, the Auckland apartment market and the Auckland office building market prior to the 1987 crash, I believe it is possible to identify whether you are dealing with a speculative bubble well before the crash. 7) Housing affordability improves dramatically in October A perfect storm of tax cuts, wage growth and lower interest rates have combined to improve housing affordability to its best level in more than 2 and a half years, the Wizard Home Loans Affordability report for October shows. 8) Have your say: ANZ National tightens home lending rules Interest rates may be falling, but credit to buy houses is no longer easy to get. 9) Have your say: Will Helicopter Ben's latest cash dump work? The US Federal Reserve announced a plan overnight to spend US$800 billion buying mortgage backed securities and securities behind car loans, credit card debt and student loans. The Federal Reserve wants to restart trade in these wholesale debt markets and get the US economy moving again. 10) Cash flooding into guaranteed finance companies as bank deposit rates fall below 6% The few finance companies who have left their interest rates close to 10% after receiving the government guarantee are receiving a wall of cash from savers disappointed that bank term deposit rates are falling below 6%.
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