Finance Minister Bill English told Prime Minister John Key that the mood among global economic policy makers is “very dark,” with there being genuine concerns the US and Europe are in for a tough couple of years.
English is currently in New York where he has met US Federal Reserve chairman Ben Bernanke and China’s Finance Minister, among others, to try and get a gauge on where they think the global economy is heading as sovereign debt crises trouble both Europe and the US.
The fact the US accounted for a third of the world’s economy, and as the danger of a Greek sovereign default grew – Key said he thought that likelihood was greater than 50% - meant New Zealand was not immune from what was happening on global markets.
But it was not all doom and gloom for New Zealand, Key said, with expectations China’s economy would keep growing at 8-9%, meaning demand for New Zealand’s exports would continue from our second largest trading partner. Chinese growth would also help keep afloat the Australian economy, New Zealand's largest trading partner. The government was also still on track for reaching a Budget surplus in 2014/15, Key said.
Key told media at his regular weekly post-Cabinet press conference that the government’s economic advisors were predicting lower trading partner growth over the next few years, but New Zealand was in a better position than most to handle any global fallout.
English had told him he did not expect wholesale money markets to dry up like they did following the collapse of US investment bank Lehman Brothers in late 2008, meaning New Zealand banks would not be completely shut off from their offshore borrowing lines.
“It’s fair to say he [English] characterised the mood as very dark. There is genuine fear that both the United States and Europe could be in for a tough time in the next 12 to 24 months,” Key said on Monday afternoon.
“As the Reserve Bank governor pointed out last week, the volatility in Europe and the United States is likely to reduce global growth.,” Key said.
“We’re not immune from the current issues with the US and Europe, but New Zealand’s position relative to many other economies is not all doom and gloom by any stretch of the imagination. This government has a plan to get our deficit and spending under control. It’s a plan we’ve been implementing since we came in to government,” he said.
Key said he had not received any advice that Treasury would have to alter its surplus and debt tracks. The government had been hoping to return to surplus earlier than the 2014/15 track, with the latest turmoil on global markets meaning that may not happen, therefore pointing to a return as the track outlined, he said.
(Updates with video of Key at post-Cabinet press conference).
19 Comments
Googled H R 645,
>>>>>>
U.S. Republican presidential candidate Ron Paul says that the federal government is preparing for civil unrest and martial law in the United States.
Ron Paul has recently said that H.R. 645 (The National Emergency Centers Establishment Act) could lead to Americans being incarcerated in detention camps during a time of martial law, Infowars reported on August 20.
“Yeah, that's their goal, they're setting up the stage for violence in this country, no doubt about it,” responded Paul.
The National Emergency Centers Act or HR 645, first introduced in January 2009, mandates the establishment of “national emergency centers” to be located on military installations for the purpose of providing “temporary housing, medical, and humanitarian assistance to individuals and families dislocated due to an emergency or major disaster,” according to the bill.
The legislation also states that the camps will be used to “provide centralized locations to improve the coordination of preparedness, response, and recovery efforts of government, private, and not-for-profit entities and faith-based organizations.”
The bill also states that the camps can be used to “meet other appropriate needs, as determined by the Secretary of Homeland Security,” an open ended mandate which many fear could mean the forced detention of American citizens in the event of widespread rioting after a national emergency or total economic collapse.
The legislation was referred to committee and did not proceed any further, but it was not rejected in a vote and can be re-introduced at any time in a new session of Congress.
In the aftermath of the UK riots, police departments in the United States are being trained to deal with rioting and civil unrest.
Back in 2008, U.S. troops returning from Iraq were earmarked for “homeland patrols” with one of their roles including helping with “civil unrest and crowd control.”
In December 2008, the Washington Post reported on plans to station 20,000 more U.S. troops inside America for purposes of “domestic security” from September 2011 onwards, an expansion of the militarization of the country in preparation for potential civil unrest following a total economic collapse or a mass terror attack.
The 'struggle against corruption' has always gone on Parky..that don't mean it's been a stuggle to hand the control of credit creation over to the politicians!...
As I have posted many times, you cannot explain where you will get the uncorruptable citizens from, to take charge of the credit creation committee or whatever....it's all very nice dreaming about utopian systems where govt and local govt can tap into free credit to build infrastructure....but at some point in time YOU have to wake up to this being a real world. Interest costs are a 'control' in themselves. If the problem is credit costing too much, the answer is to borrow less.
Take your own case in point...when you borrowed for property you brought forward your demand into an earlier time period and that, along with others doing the same sent demand for materials and inputs above a balanced position into the area where prices went up. Remember the bubble?
That is what would happen if your 'super duppa credit control committee' were to be the norm in nz. Costs for materials and inputs would rise. Your 'committee' would have to create more credit numbers to pay for stuff and labour...while every other user of the inputs would face the higher prices...that adds up to inflation...driving up the cost of labour....which means the committee has to print more...blah blah blah.
Trying to get you to accept the above, is like trying to convince people Noah's ark is a myth.
Can anyone spot the pattern? The markets can, but Key doesn't appear able/willing to.
http://finviz.com/futures_charts.ashx?t=METALS&p=h1
Anyone watching the markets lots of red ink. NZ$ .76 to the US$ gold $1548 FTSE looks like a lead ballon.
I've never seen finviz before. What struck me is that the NZD is one of the 9 currencies they monitor. We are so small, so why do they, unless we are one of the most actively traded? Is the NZD that popular as a speculative hedge?
...... and after a little bit of research it appears we really are. Everybody was going long on the NZD/JPY and now the NZD/USD. Oh well, they lost some money today .....
Late last year Bill English predicted that there was a 10 - 20% chance of a banking crisis in Europe:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10690260
Wonder if that % has come up a bit?
Also, he outlined there were large risks for us, as per below:
"So a banking crisis in Europe could lead to a sudden stop in our ability to source foreign funds."
But now he's saying we are in "good shape."
I believe Key & English are hoping the Eurocrats just kick the can down the road a bit further...until after the election would be nice.
Certainly applies right now.....if JK blinks then our economy is going to nose dive as ppl run for cover.....its a dis-advantage when 60% odd of your economy is consumerism, when they dont consume its way bad.....
At some stage the "deluded" are going to have to fess up and lead....of course their idea of leading will be cutting up the smaller pie "equally"......so the rich will get a piece equal in aize to pre-2007 and the rest of us can sing....
Just remember JK, "Let them eat cake"
regards
Catastrophic Stability The market seems to expect price stability for Germany — an inflation rate of 1 percent or so over the next 5 years. And that has a clear message: it’s signaling catastrophe for the euro.
Why? I tried to lay this out a while ago.A reasonable estimate would be that Spain and other peripherals need to reduce their price levels relative to Germany by around 20 percent. If Germany had 4 percent inflation, they could do that over 5 years with stable prices in the periphery — which would imply an overall eurozone inflation rate of something like 3 percent.
But if Germany is going to have only 1 percent inflation, we’re talking about massive deflation in the periphery,
http://krugman.blogs.nytimes.com/2011/09/25/catastrophic-stability/
Nice..........not........
regards
Well, Gold is no longer a safe place to go...aint that a bugger. What's left?....property!
Or maybe currency....yes paper money backed by prudent management as in Switzerland not NZ...we lack the political fortitude needed to control the urge to splurge for a voting surge, especially pre elections.
And so we rely on events elsewhere to discover our fate. We can thank decades of pisspoor govt for this farcical situation. Of course the pollies involved would claim it's our fault for being a bunch of envious gullible fatheads willing to believe the BS they spew out in the vote gathering game.
It's happening right now. The political promises flow thick and fast from liars to fools.
Burns don't it Wolly...!........The Oracle will be down a few subscribers come next week I should think.
I like your political assessments often times.....but I'm still waiting for you to put up some alternatives that we as voters may find worthy of consideration.
If I read you right....you would be in favor of biffing the whole setup out along with it's entrenched politicians occupying space for no better reason than time served and voting the "right " way on bills.
To replace with what...?....I'm keen....but you know what that would take don't you Wolly..!... it would take a grounswell of social unrest on a scale not seen before here........cause it ain't gonna happen quietly.....it aint gonna happen by observing what's wrong.........
A rant is a rant.....but a rout is something else altogether.
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