Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with BNZ, including estimates from the Treasury that the Christchurch earthquake may actually boost GDP in the long run.
Prime Minister John Key described the earthquake as New Zealand's largest natural financial disaster.
Treasury released its first official estimate yesterday in this briefing paper.
It saw the cost in the September of around 0.4% of GDP with the potential to reduce national GDP by up to 0.8%.
But it then saw the rebuilding work adding significantly to GDP over the following three quarters with the final result being a net benefit to GDP.
Treasury saw residential housing costs of around NZ$2 billion, commercial building costs of NZ$1 billion and infrastructure cost of NZ$1 billion.
There have been 47,000 claims so far.
Meanwhile, the New Zealand dollar rose to 73.3 USc, near its August highs, after relatively strong Chinese factory output data boosted hopes for its economy.
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29 Comments
Roll on the wgtn big one and may it be a real massive bugger cos the GDP will surely rise to stupendous heights as a result. Aint it fantastic that we can all become wealthier as a result of a disaster.
You don't need to think about it....Treasury officials said it was so....they are always on the button..they should be....they get bloated salaries because they are so good...and there are soooo many of them.
Wolly, imagine if the earth opened up and completely swollowed New Zealand- then we would be really rolling in money! We wouldn't even need the money tree seeds, we would be so rich. Trillions of dollars would pour into the economy as we mined Antartica for fill and shipped it up here to dump into the rft and bring NZ back out of the sea. Turning muck into brass!!!
By gum you have it LTS.....isn't it great to know all those economists at Treasury receiving bloated salaries know what's best for us...they deserve bonuses...I guess all the Cantabs must be positively fizzing with pleasure at knowing they are going to replace the export strategy BS with their rebuilding binge and bring us all a really fantastic rise in GDP.
On an equally stupid note...John Key repeated the rubbish that came from the Christchurch Mayor...how the excellent building codes were responsible for there being no loss of life and what a load of effluent that was....the bloody reason no bugger was squashed was because the EQ hit at circa 4.30am and the chimneys that came through the houses missed the sleeping peasants.
Actually if Wgtn did go down the country probably would be in a better position, cos all the beauracrats would be out of the road, letting the rest of the Country get on with it.
But yes Wolly, your point is noted, the tools in treasury need to go learn themselves some Broken Windows Falacy economics. and then couple that with the EQC charade, where essentially the EQC premiums have been "invested' in IOUs from the govt; i.e. the taxpayer.
So the liability for the NZ taxpayer to meet the obligations of the Govt Bonds looks to be in the order of $1.5-2B, I sure hope like hell that my parents will be around to thank my grandchildren when they appear in 25 years time, because it'll their work efforts that will be needed to repay the smoke and mirrors from this govt.
Another suggestion from Steve Keen:
".. Limit the debt that can be secured against a property to ten times the annual rental of the property.(this) would end the destructive positive feedback cycle that currently exists between house prices and leverage. (A) successful bidder would be the one who had put more of his/her own money towards the purchase. It would also allow a real landlord class to evolve - not one that makes a loss on renting as now, needs a tax break to remain solvent, and makes money by flogging the property at an even higher price to another loss-making speculator-landlord, but a class that makes a net profit from rental income."
Yes 6 but even cheaper on the taxpayer to just crank up the power of the tenant and make landlording a risky business to get into. Make rents fixed to a % of the tenant's basic wage or benefit. Give tenants a xmas week rentfree. Pretty soon the landlorders will drop the rest of their properties onto the market and carrrrrash will go the prices....sooo low in fact that those who were tenants will be able to afford to buy on their small savings....Bill is just waiting for the rest of the National Party rumpers to dispose of their holdings and then phase two of his adjustments to the game will begin. Just in time to scoop up the Labour voters into the govt camp on the back of doing good deeds for tenants!
Bollocks Duke...govt can do any bleeding thing it wants to. Not absurd to lock rents to incomes....or to write Laws that give tenants greater protection when landlords decide to flog properties....like making landlords pay the cost of removals up to say $5000...or any one of a heap of other measures!
It's coming to all the PI landlords....greater power to the tenants. Stands to reason don't it. It's why Bill started whispering the warnings to the delgates a year ago...."get out of property before I get real with my new laws".....the tax tweak was stage one....stage two will be a bummer for landlords cos there are more tenants votes to be had than landlord votes to lose....and you were warned...! Haha
Bet you Bill announces changes to the tenants protection laws before the election.....
Hey come on it's ...Be Cheerful Week.... and I've got to say ...Bernard..! like the hairdo
bridesmaid it's a little more carefree yet ruggedly handsome.
The one you've been sporting for the last wee while had you looking like an East European
Dictator .....not that there's anything wrong with that..!
Bolly must be thrilled at the performance of the NZD over the last wee while and yet at the
same time deeply concerned for the export led recovery....he's deep like that.
Of course it's completely explainable ...he just can't find the words...unlike the BNZ
economists who have all the words and no answers.
Coincidentally China has been successfully nobbeling any ideas Japan has of finding that
elusive path....... or is it all just coincidence..?
How about a little in depth study of the mountains of Money being shuffled about on the old
monopoly board.......
There must be concrete reasoning for the inexplicable strength of the Kiwi as opposed to
the twaddle served up in metaphors as some kind of digestible biscuit to have with your
milky tea...?
Wolly, based on what Philip Combes said here - http://www.interest.co.nz/news/nzdmo-nears-appointment-6-banks-manage-i… - some developments shouldn't be far off...
Oh sorry Gareth....maybe it was in my wording.....or coma set in before I made the point..
Any word other than the bankers drivel...as to why the NZD has surpassed artificial highs to reach the ......oh sweet Jesus it's .....Alive.
You see while coat-tailing plays some minor role in it's support......it does not compute.
I agree, especially if large numbers of businesses decide that re-building is not worth it and demolish instead, see http://www.stuff.co.nz/the-press/news/christchurch/4125368/Demolition-not-dining-on-menu.
Although the Treasury won't agree, could I please make a special request for earthquakes to immediately and permanently stop in NZ. Thanks (then maybe I can get some proper sleep again).
"It was only 7.1" Are you James Bond? I'm pretty sure only 7.1 wouldn't faze him either. But as you can tell, my nerves are hardly made of steel.
I wouldn't rebuild either. I mean, what's the point in putting in all this effort to rebuild when we may well get this even bigger one soonish.
Agree with you Troy. But today, it is annother “NorthWesterly-Day” peopple are saying, drinking and writing of all sorts of stubid things it dpoesn’t matter if they are economists or intelli-cent peopple, live in the Marlporough’s Wellington, Auckland or other academic places.
i think you will find there's a fair bit of hand up the dummy and make the mouthpiece move to
whatever tune seems to be right for the occasion however out of step it may be.
Bolly sold out years ago so don't expect anything other than the party line coming out of that
orifice.
@ troy 11.36am
ok but if we have a disaster that could do with some manpower at the same time as we have high unemployment then surely we could think about using excess labour to help out in Canty?
i know its all a bit socialisty, but its also pretty dumb to leave resources unused like that.
Here's something special for the chicken guts readers.....!
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