90 seconds at 9 am with BNZ; yuan rises; Queensland floods; unemployment; AAA sovereigns

90 seconds at 9 am with BNZ; yuan rises; Queensland floods; unemployment; AAA sovereigns

David Chaston details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand.

The Chinese currency continues to be allowed to strengthen against the US dollar, and is now under 6.6 to the dollar for the first time. That represents an appreciation of their currency of 3% in the past four months.

Part of this is to blunt US criticism ahead of Premier Hu’s visit, part is an unavoidable export of Chinese inflation. All of it recognizing the weakness of the US dollar. But is it enough? By comparison, the NZ dollar has risen 8%  against the US dollar in the same period.

Across the Tasman, their unemployment level fell to 5% ahead of the QLD and NSW floods, but job growth was surprisingly poor.

There will be a huge demand for labour for their flood cleanup and that will exert pressure in New Zealand. Adding to the local pressure is that TradeMe is reporting a big surge in job ads here.

And we have our own disaster that is requiring people for recovery work. All that will add to rising incomes in 2011 which will help domestic demand.

Moody's has been assessing its AAA rated sovereigns and has pointed the finger at France, Germany, the UK and the US saying they must control government spending.

Australia, Singapore and NZ were also included in this review, and they generally like what they see of how NZ is handling this period. They are making no downgrade threats at all.

And in Europe, the ECB is threatening to raise interest rates there, focusing on countering the inflationary effects of what they have called irresponsible fiscal policies. This will cause a big fight with the politicians and their voters who seem very reluctant to face up to what has to be done. Strikes and reaction are the order of the day in Europe’s flashpoints.

 

 

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"While the (2011 @ 4.55 metres) flood isn't the largest in Brisbane's history (that title goes to the flood of 1841 with 8.43 metres), it came at a delicate time for the state and the country. In the wake of the gold rush of the 1850s, Australia enjoyed an economic boom focussed largely by property investment that began to unravel towards the end of the 1880s. Burdened by speculative property loans gone awry, the Melbourne-based Federal Bank collapsed, which sparked a fully fledged banking crisis that claimed more than 10 Australian banks within a few months."

This all sounds spookily familiar!

http://www.businessspectator.com.au/bs.nsf/Article/THE-DAILY-CHART-A-bit-of-Brisbane-River-history-pd20110113-D2V3B?OpenDocument

"Australia is...different..."

"Australia is...different..."

My oldest friend ( he's one day younger than me) has an English School in Osaka and told me, years ago, that " sex has become a meaningless function" in Japan. Needless to say, he's stayed put there since '75!

Maybe we should explain to Japan how to introduce a DPB , then at least the feral under-class will have alotta babies ............ It's worked a treat in NZ for 3 decades  or so .

.[......... No mention of what % of  girls in that age bracket were totally un-interested in sex . ]

Peter would suggest it's less than 5%. Mind you; he does have a perpetual scip for Zovirax......English School, eh..

I can never understand why Government Debt is always being highlighted and not Private Debt.  Poor Ireland did not have a large Government Debt until it took over the Banks' Private Debt.  New Zealand has not got a serious Government Debt problem but our  Private Debt is horrific.  Now if our Government took over the big fours Banks' Private Debt as it guaranteed in 2008, and which is still on the books, we would be in serious trouble.  And then everybody would talk about how bad the Government Debt was rather than having discussed NOW if a Government should ever take over Private Debt. 

S&P did a review of NZ's private debt levels , a few days ago , and they concluded that we are a " high risk ". ......... Seemingly excessive leverage is no longer de riguer in financial markets ...

.... And isn't it a case of the pot calling the kettle black , for these  Americans to hector us on this point    !

Clearing one's debts and saving money is apparently such an incredible feat that it's worthy of an article on CNN.

http://money.cnn.com/2011/01/14/pf/anna_newell_jones/index.htm?hpt=C2

Yeah and the best bit..." A perk of my job is a bus pass for only $10 a month."....paid for by the good taxpayers.....didn't she do well !

Let us give thanks to the drug companies for the fast and cheap painkillers which mean my toofake is like the NZ economy, enough to keep me unbalanced and destined to lead to some serious money problems...for me...and a new Bentley for someone else.

We are in a recession. Forget about the survey BS. It will be very long thanks to the decision to protect the property bubbles to ensure the credit pushers remain in control and the stoopid people carry on with their debt filled lives to their graves.

Export bonanzas bringing wealth and jobs to all...total crap but the message goes down a treat and means real policy action never takes place. Right now the bulk of the commodity boom is being caused by Bernanke printing to death the US dollar with speculation in the market by the very banks and mates who get to gorge themselves on his new 'money'. There is a small increase in demand from consumers for commodities but not enough to warrant the explosion in prices.

In Europe civil unrest is evolving into the promise of a spring and summer of riots, burning and killing. Meanwhile the end of the euro is close and the insiders are planning their escape route for their wealth.

Here in NZ English is hell bent on boosting the govt debt to the cliff edge. He and this govt will not be the ones paying off the debt, if it is ever paid off. Just as a wad of fools are trapped owing 180 billion in household debt...a burden they can never pay off...so the country will join them. The banks are happy farming the families and ruralites and the foreign savers will be happy farming NZ for ever and ever.

Oz, here we come!

My two brothers, and two nephews (all of us builders and an apprentice) are off to Australia next week to help with the rebuild. The pay is almost 250% what I'm on now. Bye bye NZ, and if I return it will only be to pack up the rest of my stuff.

(Patriotism is for poor people.)

The first of many, no doubt. Who's going to rebuild Christchurch, now?

all well and good but it needs to stop raining first

Good on you. Do what you must. The government here just don't get it

US housing market has 50% fall to go...?......yikes.... http://www.marketoracle.co.uk/Article25597.html

That article below is well worth a read...it removes a few cobwebs..or are they conwebs....and what of the seriously unaffordable housing in NZ...the Elephant squashing the families...eating most of the wealth...and leaving massive piles of dung behind for others to take a lifetime to clean up !

Patricia, can you explain more about guarantee in 2008? ta

 

The irony is that as a shortage of skilled labour emerges in NZ so up goes the remuneration

Yet no matter how much of a skill shortage we may have the pay is always higher in Aussie and elsewhere.

Meanwhile NZ's minimum wage paying billionaires and hundreds-of-millionaires complain that they 'cannot get good staff' and that 'kiwi workers are disloyal' and other crap.

Give me a Kiwi worker any day.  Also, have a mate who has gone to Australia and developed a transport business- has fleet of 48 trucks.  He is fed up with work-shy Aussies and makes a point of employing Kiwis . 

 "EASTERN psychics, astrologers and palm readers are reporting a huge surge in demand from a new class of customer high powered professionals who want advice on how to survive the credit crunch."?google aussie news.

Not a minute to be wasted. Grab the crystal ball and be a psychic winner...no regulations here...you're just putting people in touch with their ancestors who will guide their relatives through the shite to greater wealth...and collecting the donations to your Church of the Crystals Balls...tax free of course.

Who would dare not make a hefty donation when the ancestors suggest it.

That "new class of customer" is probably the "savvy and discerning buyer" our real estate hacks speak of.

Oh yeah... that's them all right. Always an idiot desperate to be fleeced.

 

"As a result of the Harris report, the Government has a bill before Parliament to better regulate trustees and bring them under the supervision of the new Financial Markets Authority (FMA).

It would be imprudent to write of a cosy relationship between the trustees and their finance companies, so I will quote from the submission of Perpetual to the select committee for the new legislation:

"The current system fosters close working relationships between trustees and issuers, and allows small issues that arise to be dealt with discreetly before they develop into large problems.

"Those close working relationships between trustees and issuers do not present a 'problem' (sic) that the bill should seek to address."

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10699937

It remains to be seen whether the govt has the guts to protect investors against trustees...!