Here some other stories that are worth noting this week, plus a summary of key data.
The sunbeam solution
California's state government may be close to bankruptcy, but it's private sector is still a key center of innovation. A major effor is underway to harness and store sunlight, in much the same way chlorophyll works. If it is successful, it will change our world.
Two halves
The stunningly low January house sales data - an all-time low - possibly marks a turning point in other ways as well. In 2010, the market did not clear - sellers held on and many rented their places out. Median prices held up despite low volumes, because the higher-priced end of the market kept selling. In January 2011 however, it was lower-priced houses that started to sell more, while the higher priced end saw sellers withdraw. Nationwide, there were only 73 67 houses that sold for $1 million or more.
A social revolution
A stunning new technology is about to be a major economic game-changer - probably rendering the advantage of "low-cost manufacturing" - indeed much industrial manufacturing - obsolete, at least for many consumer products. Advances in 3D printing are compounding quickly. Current notions of designing, marketing, and distributing are in for very major disruption. Millions of manufacturing jobs are under threat.
Be who you are
"Be who you are and say what you feel, because those who mind don't matter, and those who matter don't mind."
- Dr. Seuss
more below ...
| end of | end of | --- 52 week -- | ||||||
| Week | last week | high | low | |||||
| -------- | -------- | --------- | --------- | |||||
| FX rates | NZ$1=US$ | 0.7598 | 0.7682 | 0.7964 | 0.6584 | |||
| NZ$1=AU$ | 0.7669 | 0.7583 | 0.8212 | 0.7408 | ||||
| Gold | in US$/oz | 1,356 | 1,355 | 1,421 | 1,082 | |||
| in NZ$ | 1,785 | 1,764 | 1,877 | 1,546 | ||||
| Copper | in US$/t | 9,921 | 9,986 | 10,145 | 6,091 | |||
| in NZ$ | 13,054 | 12,999 | 13,171 | 8,951 | ||||
| Crude oil | in US$/bl | 85.44 | 88.84 | 91.91 | 69.89 | |||
| in NZ$ | 112.45 | 115.64 | 121.36 | 101.30 | ||||
| US Treasuries | 30 yr bond | 4.75% | 4.73% | 4.78% | 3.61% | |||
| Dow | DJIA 30 | 12,272 | 12,089 | 12,275 | 9,688 | |||
Economics for grownups
Worried about the national debt? Don’t be. “If Oriental protectionists are foolish enough to send us TV sets in exchange for green pieces of paper, wonderful." What is missing from most economic discussion is the importance of Bourgeois Dignity - it is why economics can’t explain the modern world.
Happy with no growth
There are major changes going on in the New Zealand mortgage market, but they are happening quietly. Borrowers are abandoning fixed-rate mortgages quickly, probably because the interest rates on variable mortgages now give a lower weekly repayment cost - and the rate curve steepens. This shift to floating results in fatter mortgage margins for banks, which is why the majors aren't competing on price, and seem happy for their overall mortgage books to not grow. In fact, losing a customer - usually to Kiwibank - results in Kiwibank having to fund the big bank for the transfer. The moribund housing market also means far fewer mortgages are being transferred, or new ones written - and the low January levels are carrying over to February. The Nelson Building Society, and Manchester Unity were the only two institutions to change rates in the past seven days.
Up and down
On the term deposit front, RaboDirect raised its 6/9/12 month rates by about 0.15%, PSIS lowered a whole bunch of rates for terms 6 months through 4 years (all down between 0.10% and 0.15%, and putting them under the RaboDirect equivalents), and NBS did some minor trimming as well.
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