90 seconds at 9 am with BNZ: U.S. consumer confidence plunges; Treasuries, gold and oil rally; earthquake/insurance premiums to rise?

90 seconds at 9 am with BNZ: U.S. consumer confidence plunges; Treasuries, gold and oil rally; earthquake/insurance premiums to rise?

Amanda Morrall details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news that U.S. consumer confidence has plunged to a 28-month low.

U.S. Treasuries, gold and oil rallied over night following news that consumer confidence fell the most since
the global financial crisis. See more here at Bloomberg.

Renewed concerns of a recession triggered a buying spree on U.S. Government bonds. There was also expectations the Federal Reserve would try harder to push down borrowing costs.

The Dow closed up 20 points or 0.2%. Gold rose 2.1% and oil rose 1.9%.

U.S. housing prices also slumped, however there are indications the real estate market meltdown there may be stabilising.

Closer to home, there is speculation that insurance premiums and earthquake levies could be on the rise.

That's in the wake of yesterday's announcement that the Earthquake Commission's liabilities have ballooned from NZ$4 billion to more than NZ$7 billion. (See Alex Tarrant's story for details).

Credit rating agency Standard and Poor's has upheld the EQC's AAA rating because of Government's backing, however it is said to be "working through the implications" of the revised estimates on the Crown's operating balance.

Meanawhile, Earthquake Minister Gerry Brownlee will be heading a delegation to Monaco next week in an attempt to shore up support from reinsurers.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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19 Comments

Relax!, its only us watching ;-)

If I was a reinsurer, my biggest uncertainty over Christchurch would be regards government competence. Sending a delegation including Earthquake Minister Gerry Brownlee to Monaco may clarify that, but possibly not to NZ's advantage.

Yes, quite...

http://www.telegraph.co.uk/finance/financialcrisis/8731894/Double-dip-fe...

ryck

12 minutes ago

 

"In a strange way - I believe that we owe a debt to President Obama, his libtard brethren, and the mainstream media enablers of both. President Obama essentially shoved all of the Keynesian and Socialist poker chips into the pot - ALL IN!  It will probably be remembered as one of the biggest and most foolish gambles ever made. Busted flush that."

Prophecy in poetry. Very good.

http://www.telegraph.co.uk/culture/books/bookreviews/7817873/The-Uses-of...

 

Simon Heffer applauds a fine defence of conservative thinking in The Uses of Pessimism and the Danger of False Hope by Roger Scruton

So US consumer confidence plungs - flashing a huge red light for recession.

Gold responds - by going up (as has been the pattern following bad economic news)

But oil jumps too? Generally oil has gone down (as one would expect) recently off the back of recessionary news (demand would fall). Not this time though - interesting.

No doubt the markets are drawing a long bow:

Recession = QE3 = more money into commodities (ie oil).

But if demand for those commoditities falls off the back of demand collapse?

Oil stays high in a recession? Wonder what that could be a symptom of?

Long link but worth it for the laugh. So good in fact that it is a shame it isn't Friday.

Seems as though the Greeks will nationalise their banks, and then offer them as collateral for the bailout loans.

 “The worldwide “emotion storm” of people buying gold is coming”

Why is the physical gold- market in NZ so inaccessible ?

Its not - well compared to Switzerland perhaps - but there are quite a few outlets now where you can buy. Here are 3 off the top of my head:

NZ Mint

Morris and Watson

Regal castings

Andy -  in countries such as India, I guess even dairies are dealing (trading) with physical gold.

Maybe we could learn something from this?

 http://www.marketoracle.co.uk/Article30175.html

 The fact that this nevertheless occurred stands as testament to the strength of Canada's economic record. If the United States and Europe hope to have any role in the world of the future, it is clear they have much to learn from the Canadian example and the lesson of Canada can be summarized as follows: the size of a country's problems is directly proportional to the size of its government.

 

hey,Amanda is really good at this, future in TV?

Loss of cofidence in the US. Now at a country near you.

 

HARVEY Norman chief Gerry Harvey has warned that retailers face a "shocker of a Christmas" as unemployment creeps up and consumer confidence sags in weak domestic conditions.

"Retailers will have the hardest Christmas in their lives," said the boss of the country's biggest electrical and furniture chain .

"I see unemployment going up, small businesses going under, manufacturing under huge duress and tourism hit very badly. I don't think the outlook will improve."

http://www.theaustralian.com.au/business/companies/harvey-warns-retailers-to-brace-for-a-shocker/story-fn91v9q3-1226125929385

Amanda, you should nip down the road and interview these guy's.

 

HARVEY Norman chief Gerry Harvey has warned that retailers face a "shocker of a Christmas" as unemployment creeps up and consumer confidence sags in weak domestic conditions.

"Retailers will have the hardest Christmas in their lives," said the boss of the country's biggest electrical and furniture chain .

"I see unemployment going up, small businesses going under, manufacturing under huge duress and tourism hit very badly. I don't think the outlook will improve."

http://www.theaustralian.com.au/business/companies/harvey-warns-retailer...

 

Thanks. Will add to the list.

Jeepers kiwidave you are quicker to trhe draw than me, Id better get some practice in

 

UK consumer can't even afford minced beef...  (UK 1.50 for 500g) no VAT (exempt).

Poor beggars, ours costs loads more... 

Wow....just discovered a new use for water blaster...the camper shower/dunny cubicle...bleeding super job.!