90 seconds at 9 am with BNZ: Dow down 2.5% on growth fear; NZ$ down to 71.5 USc; A very Remuera Ponzi scheme

Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with BNZ, including news the S&P 500 and the Dow fell 2.8% and 2.5% respectively on fresh concerns the US economy is struggling to recover.

The US Federal Reserve's comments yesterday about slowing growth and its only moderate action to pump money into the economy triggered new worries about the world's biggest economy.

The Fed appears to have adopted the same strategy as that used in Japan before it entered a two-decade long stagnation.

Also, factory output growth in China was its slowest in 11 months. The oil price fell under US$80/barrel on worries about the slowing global growth outlook and the US 2 year Treasury bond yield fell to a record low of 0.48%.

All these worries about global growth and fear about risk drove people away from the 'risky' New Zealand dollar. It fell to 71.5 USc in early trade and is down two cents this week.

The Bank of England also lowered its growth outlook. The yen jumped to a 15 year high as investors piled into Japan on the view it seemed a safer haven than anyone else at the moment, although it too has its own growth and ageing and debt worries. Ironically given the US growth concerns, the US dollar also rose vs the Euro as investors avoided risk and opted for safe havens such as US Treasuries.

Back in New Zealand, the New Zealand Herald reports that the Serious Fraud Office is on the verge of laying charges against Remuera financial advisors Jackie and Mike Bradley over a Ponzi scheme that appears to have lost 54 investors more than NZ$17.8 million.

Investors had been told the money was invested 'overseas' and was safe in 'Swiss Bank accounts.' It appears to have been lost.