Serious talk of Greek exit from eurozone; Fears of capital flight and contagion; China eases bank capital rules after weak output
Here's my summary of the key news over the weekend in 90 seconds at 9 am, including news that serious talk is growing that Greece will be allowed to exit the euro.
European central bank players and European officials spokes about how Greece might exit and how to limit any damage.
The election of parties against austerity plans has forced European officials to consider their options. Angela Merkel's pro-austerity party was heavily defeated in the North rhine Westfalia state over the weekend.
The Greeks themselves still think they can reneg on their austerity plans and stay in the euro. But European companies are increasingly pulling their cash out as soon as they earn it to avoid having it stuck in Greece in the event of an exit and a return to a vastly devalued Drachma.
Meanwhile, China lowered the reserve requirements for its banks by 50 basis points to 20% over the weekend after weaker than expected industrial output figures raised fears about a hard landing in China.
Many now expect China's leadership to cut interest rates to boost the economy, although there is some doubt about whether the now-fractured leadership can take decisive action in the middle of a once-in-a-decade leadership transition.
The New Zealand dollar was solid just above 78 USc in morning trade, but did test lower over a volatile weekend dominated by the Greek worries and news of a shock US$2 billion loss by credit derivative traders at JP Morgan.
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82 Comments
After the next election in June the Greeks will follow the path of the Irish, that is to buckle, and comply with the bankers demands as a means of ensured funding. The ones to watch now is how Spain, Italy and indeed France will handle the financial pressure re cost of funding to keep their bloated economies going.
Any country that promotes 2-3 hour lunches have to rethink this work ethic, in my humble opinion.
The problem is that this financial model is broken and those in power don't have the will to fix it.
the confluence of events from JP Morgan to France , Greece etc is all starting to suspiciously look like the same buildup prior to the GFC in 2008....wonder what will happen to gold?
it's been languishing and not responding as a bellwether to things as you would expect but with capital flight and unease globally, that may change.
while i'm here..g'day to me ole mate, Christ-Stove....and Wolly and the Gumster...
Always...good to hear from you ROBO the Glen....I think A.J's got it right a deflationary slump looms, maybe Japan can council them through it ,...as they should be experts by now.
To gold being the bellweather that rings in the changes to batten down the hatches, as it were.....
Wots brown an sounds like a bell.....?
Dung..!
that's a good one init...!
World edges closer to deflationary slump as money contracts in China All key indicators of China's money supply are flashing warning signs. The broader measures have slumped to stagnation levels not seen since the late 1990s.
The Yangtze shipyards tell the tale. Caixin magazine said eight of the 10 largest builders in the country have not received a single new order this year. "A wave of closures in the shipbuilding industry has yet to begin. A hurricane is approaching," said one official.
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/92631…Ive just been selling the last of my sheep, I kept a few to clean up around the house. The last Ewes I sold in early Feb, I got $230. I just got offered $100 for the rest. The sheep market has collapsed. Wool was $4.60 when I shore my ewes last year, next week Im expecting to get $2.40. Beef is back at the weekend and lamb back another 10c a kg. The farming industry is in a collapse and Im including Dairy in that. Our trade figures for the next year are going to be horrible.
It costs me about $50to $60 to produce alamb. Last year I got $160 and had $110 above basic costs now Im budgeting $80 for a lamb and a %10 increase in costs Im going to have $20 left if im lucky, my bank manager will be an unhappy lad, better take a bottle of whiskey to my next meeting.
I had to go to Auckland last week for a Visa to the USA, our motel in Newmarket with 60 rooms had 6 rooms in use, the filipino girl at the desk told me that in the past they ran at over %80 occupancy during the week and close to %100 at the weekends. Now they get %20 at the weekend. She told me, 'something is terribly wrong in Auckland'. They have closed the small retaurant as it was uneconomic and they now special rooms at $89 still no one comes.
This thread is a great one, one of the best on dairy Ive seen on this site, thanks to the commenters involved
http://www.interest.co.nz/news/59209/rbnz-sees-rebound-bank-profits-200…
Gibber, the lady told me that they often get a lot of reps coming through but not at present. I have a friend from AKL who comes down to the farm duckshooting, he told me the housing market in AKL was stuffed. I said no way the data and the boys on Hickeys tell me its boom times. He responce was , ' they are dreamers and that he had friends trying to sell and its tight and hard work'. Who to believe?
My question to you would be, is Auckland immune to the rural economy and exporters woes? What we need is a sharp correction in costs, we needed it last year but we will take it this year but I dont know if we will take it in 5 years as we will all be stuffed. Government tax take is going down and down.
On the way home we stayed with friends in Taupo, as they are elderly we thought we better have a motel as back up. We checked for vacancy signs on the way in, every Motel had a vacany sign up, every single one. The restaurants were all empty, thats 6pm on a Friday night, we are stuffed.
I think we are entering a deflationary spiral and its going to get ugly, very ugly. We have lived beyond our means for too long and filled the hole with debt, with out debt then we get a sharp reduction in our standard of living. Why should Califoria have %25 unemployment and we have f all? why are we so much better than them? They at least have let the housing prices correct, the problem now is everyone expects it to continue for years, they have caps on council rate increases, so unable to increase rates councils are going bankrupt, here they just keep adding %10 to my rates. Id rather my local council went belly up.
Very true. I was doing a presentation to the local council this morning that included a link to interest.co. When I went to the link that crap came up so I simply killed that part of the presentation.
Ten out of ten to interest.co on how to lose friends and influence.
If you use the addblock extension then go to options and customize. Hit edit and paste this in */css/img/*_bg.jpg$domain=interest.co.nz Compliments of drsr from trademe.
Pasting this into the subcribe line at filter lists has also been recommended to me. https://secure.fanboy.co.nz/fanboy-adblock.txt
Gibber
Many thanks for that.
I can understand you'd prefer it wasn't there.
But...we have a choice. Either we don't have this site, we put up a paywall or we take these sorts of ads.
We worked hard to ensure it did not cover or block any of the context.
#we'dloveitifyoukeptcomingbackanddidn'tuseadblockerasitstheonlywaytokeepthesitefree
cheers
Bernard
Bernard I have installed the addblock plus beta extension and was already using adblock. Attempts to right click on the add and use addblock to remove it also removes the top half of your webpage, including the options bar and links to the news stories.
May I suggest that you provide a working option for those not wishing the distraction, it really is quite annoying.
I have managed to block the same add from the metservice site no problem.
I do agree with Steven above in that you do have to put food on the table, what I object to is the efforts that seem to have been made to confound add blockers. There are those of us that have resisted being conditioned to acceptaince of being bombarded with the stuff and usually find the back door to eliminate what we don't want, but that add sits over the top of your content, so efforts to block it block your content also.
I see some very useful comments lower in the thread by Iconoclast, and Colin also also pointed out the downside for you.
What you are gambling with is the psychology of habit, and I have pointed this out to an MMOG that I recently quit because they introduced gambling. What you have to work out is how many people you piss off and how long do they take to form a new habit, ie go somewhere else instead of here.
I also realise you tread a fine line at times:-) Have a great day.
Bernard,
its when you have the add at the top when you reply that is off putting.
One of my major beefs with interest.co.nz is that it has got noisier and noisier ad wise.
I understand the need to have ads
So does google
Googles major source of revenue is ads
Google manages to keep people coming back. Mainly due to the uncluttered ads. And avoidance of INYOURFACEADSTHATAREREALLLYREALLYANNOYINGANDnowInterest.Co.NZWhichonlyUsesabouttheMiddleHalfofMyLaptopsBrowserScreenForContentAndTheotherHalfForBloodyAnnoyingAdsIsInDangeroflosingOneSetofEyeballs.
Interest.co.nz is in danger of becoming a nogo area for me because the ads have passed the threshold of "noise I can live with" to "noise I will try and avoid".
Yeah I think a lot of companies and organisations running websites don't realise how annoying the site is when it forces you into a screen that's a small part of your available desktop window. That and surround the content with ads. Like those 'news' sites where you end up following an interesting sounding headline only to find that the whole article is about two sentences long and surrounded by ads.
Regarding Google, I remember using it in 1999-2000, and it was light weight and very fast. They have resisted the bloat, but it continually gets bigger and slower. I have recently turned to http://www.duckduckgo.com as it's more like the light and fast interface Google used to be.
I pity anyone trying to use 'modern' websites with anything less than cable speed Internet connections in NZ. Actually, come to think of it many websites perform very poorly via cellular too - haven't tried the new interest.co.nz via cellular yet.
Website designers should be made to access and edit their own websites via a 300bps modem, just for good riddance. OK, I'll stop ranting now. :-)
Yep, thats changing slowly within the web dev industry. The whole 'responsive' design ethos is about creating sites that are device and connection optimised. Its taking its time though.
I'm still waiting for a mobile version of interest.co.nz. Hell, it wouldn't even be hard to just rewrite the stylesheet for the site.
There is no way the housing market in Auckland is stuffed. I went to an Auction in the weekend, lots of people there, house sold under the hammer for more than I expected - about 30% over CV. This was in Mt Roskill.
I think properties that have major imperfections (e.g. very busy road, transmission lines, bad neighbourhood, miles from city) are hard to sell - but then it just comes down to price really, often people ask too much for these.
a collapse is inevitable.
New Zealand population growth stalls
http://www.stuff.co.nz/national/6916623/New-Zealand-population-growth-s…
It's all Elley's fault ! ..... she and the hubby were pumpimg out " friwis " ( Frog X Kiwi ) left right & centre ; re-populating Oxford .....
.... then she went and got her old man vascottimeed ..... snip snip .... and the NZ property bubble is all over , Rover ...... collapse is inevitable ..
Your fault , Elley ... tsk tsk !
A.J. I could'nt help but notice Bernards abscence from that thread ....and I agree with you it's one of the better reads here in a while. dealing with a subject thats going to affect us all in the near future.
But I guess in an economy preoccupied with the buying an selling of houses to each other , it probably makes sense to the big B to make money out of just talking about it....ad nauseum .........OLE ! zee bull.
Bernard, I go to andrewjs link:
http://www.interest.co.nz/news/59209/rbnz-sees-rebound-bank-profits-200…
And find a thread where people across a range of disciplines are pooling ideas to increase their understanding of some of the major issues facing the NZ dairy industry. The first comment is by Alex and it is in reference to video he has added. From the second comment there is only 1 further out of 75 that are on the subject of your article. Residential real estate is not discussed so the trolls are absent. Overall the thread is a polite and very valuable discussion with almost no refenence to the article.
You go to the same link and don't appear to notice any of that. It is your article and I presume you are focusing on that with your reference to the Herald.
From what I can see interest.co is surviving partly because there is no convenient alternative for having the sort of discussion I describe above. If their was an alternative it wouldn't be hard pressed to take away a significant section of your contributing users.
Interest.co is failing because it doesn't seem to understand what its user's want. You appear to be working to an outdated MSM business model focused on your needs.
If interest.co does fail I expect anything but entrained thinking or inabilities to adapt will be blamed.
I think on the thread you mention Colin R...we enjoyed the space and time to research some things and follow up on them with a level of dilligence, in part because many property biased posters both pro and anti along with a few others who ,didn't see the signifigance of what we were on about were absent from the thread . As a result it was more a case of information sharing, rather than argument or hypothosis for the sake of opinion expressed.
iconolast Omnologo and Henry Tull among others were stand out contributuions.
I enjoyed the experience rather more than usual.....and so a lot of my normal banter was superfluous to need.
No Colin ...the thread is on this very page further up posted by A.J. take a look at the bottom of his post you will spot it ...just activate and away you go....make sure when you post, to post as a reply to someone who checks their incoming for replies.....like iconolast or myself....
I had found it as you suggest by following Andrewj's link. Then put that link into my comment as well. But the process is primitive and part of the reason why I commented:
Interest.co is failing because it doesn't seem to understand what its user's want. You appear to be working to an outdated MSM business model focused on your needs.
Point taken Colin R...I too would like to it to remain a current thread....in the interests of investigative journalism I should have thought interest .co would benifit by it......and that now seems to be something that's missing here since the heady days of Brian spondre getting punched out by that nasty Crafar chappy.....just so much cut n paste nobody wants to dig dig dig anymore...although credit to Gareth on his Treasury blunders articles ...first class..informative ...accurate.
Funny you should say that.
Just getting warmed up and it disappears. Had some ideas that needed running past the cogniescenti. Spent half an hour looking for Colin's contact email to run them past him but couldn't find it.
Interest.co.nz needs a coupla more pages
- a suggestion box page
- a "Top Paddock" page
Agree with your comments Christov, Iconoclast and Colin. I would like to suggest this thread further develops and probes the foundation issues the Crafer saga exposed. With the DIRA been fast tracked through select comittee process 3 months from 6, for as David Cunliff said is significant not just for Fonterra as a co-op, but the country in general. This in combination with the debate, tension and division TAF is creating in its attempt to fully destruct Fonterra as a co-op is quite significant for the country.
As a fonterra supplier, it seems the information we are supplied is orchestrated PR laced with spin. It's so blatantly flawed and self serving, it's almost amusing if the consequences weren't so dire. The perspective you folk provide is very important from my point of view, and it would be nice if a wider group of Fonterra shareholders could be exposed to it.
Greetings AJ, I was in Devonport, staying with an elderly uncle at Cheltenham beach (farm kids love playing on the beach). Whilst on the beach and around Devonport with kids, I was amazed at what I thought were signs of affluence; grooming and presentation expressing confidence and security, like something out of a shampoo advert, european cars, nice houses and shops. Very different to life in overalls, rain coat, gumboots and a muddy motorbike. Granted I didn't stop by Otara on the way home, but North Shore seems well off. I asked Dad what he thought is underpinning this show of wealth, considering high debt levels in farming, and he thought it was govt borrowing.
Omnologo, I was thinking the same thing, a transfer of wealth from the productive sector in the rest of the country.
However if the productive sector aint got it then the government have to borrow more.
Governments runing operating deficits get in trouble pretty damm quick, so its going to be slash slash slash. Its like that old joke, whats the most important organ in the body, every organ thought it was most important, the anus wins by shutting shop for 3 days. Thats what we need to do in the country, starve the buggers out, shouldn't take too long, we are on day one by day two, they will feel light headed by day three the productive sector will be all they talk about, day four and we will be winners ;-)
Well put Andrew. I can see sense in a super university in Auckland to foster development of a more diverse economy, but how is killing the golden goose (through ag debt, foreign investment, and co-op instability) going to help achieve that?
Dad told me of an article he read about our best and brightest migrating across the ditch, and suggesting NZ join the Australian economy to stem the exodus, apparently it's not unfeasible.
What NZ has in its favor is availability of water. We currently export that water in our agricultural products, although the way thinks are going, super tankers may be berthing off Manipouri in the not too distant future. If NZ does join Australia, Dad thinks you could kiss Aucklands ass goodbye.
People aren't migrating to Australia, they are migrating to Sydney or Melbourne. Its the same inside Australia too, people are leaving smaller centers and moving to larger cities. The same is seen in the US, with the agricultural belt of the mid-west emptying out, and in some desperate cases towns are paying people to move in.
Until NZ gets a city with 3 or 4 million people, they will keep migrating, even if we were part of Australia.
Seems to me an exchange rate more correctly managed (i.e. probably 20% below where it is now against most; 10% below the Aussie, which also seems high) would help solve some of the issues. Happyfunbags is right that Sydney/ Melbourne are already the main Head Office cities for Australasia, and so will have above average inwards migration, and many of the bigger jobs. Perth will keep okay while mining is big. The other cities- Brisbane, Auckland, Adelaide, and their respective regions incl NZ- need to be regional hubs, and can be manufacturing centres as well as technical or other hubs; and tourist destinations. Our relative high interest rates, Reserve Bank policies and government inaction mean the dollar is kept high, largely by money flooding in chasing the returns and assets. This seems to me the cause of massive private debts, including farm debts; and of a very uncompetitive economy. Manufacturing and tourism are both killed by the high dollar. We end up making lattes for each other until the lights go out.
"Slapped in the Face by the Invisible Hand: Banking and the Panic of 2007+"
I found it an interesting read,
http://www.frbatlanta.org/news/CONFEREN/09fmc/gorton.pdf
regards
The Ad thingy is not causing me too many distractions....like anything , in a little while you stop seeing it and poof it's not there..........a lot like Gerry Brownlie (oops mis-spelt).
Gibber ...scarfie you wouldn't want to have Tinitus.....then you'd know what distracting is....no escape...no relief...just block it out.
I think ,do what you gotta do Bernard....it'll only put more value on it for Fairfax in the long run and of course help with that mortgage Olly got you into.
In that case iconolast they'll make it a conditional offer that the Valiant Charger has to go.
By the way ...loved your work over at the http://www.interest.co.nz/news/59209/rbnz-sees-rebound-bank-profits-2009......
really excellent contributions and appreciated I'm sure by many involved......me too ta!
It's a subliminal con .. if you are not on high-speed broadband .. the page takes a long time to load .. and you click in the white space at the right or left of the page and start scrolling down .. but .. zowee .. you have clicked on an advert and when the image appears .. it disappears immediately and you get taken to the page the advert points to ., and if you are not on high-speed broadband you finally give up going there .. and the number of visitors drops alarmingly .. and as Fairfax found the incremental revenue from the one extra advert diminshes the visitors to all the other ads. catch-22. And the total net-revenue actually falls. Wait and see. Now if you were Hickey you would be on the phone Fairfax's digital advertising department straight away.
Bernard,
in its current form.
Not Much. Maybe 25 cents per day to get rid of the advertising. Which would have the benefit of those ads not taking up my bandwidth. I either pay for using your site by sucking up the bandwidth for the butt ugly large mitsubishi ads and their bretheren. Or I pay via paying you. And if you could make it as a PayAsYouGoPayWall (PAYGPW) then I would happily click a micropayment to get rid of the buttugly ads on day by day basis. Harder for you to do than a monthly payment. Better for me though.
I mainly come for AndrewJ's contributions and Stephen Hulmes. If they told me where else they hang out and post their wisdom and links then I'd stop coming here. Although over the past week to month Amanda has been doing a good job of looking at different aspects of the financial world. So maybe there is some original content of your site that might be worth paying for.
To get me to pay more thant 25 cents per day I would like to see additional features. Such as:
Too much noise re house prices. It is a very narrow web site in terms of debate.
To reduce some of that noise, I would like to be able to filter out some of the regular contributors. Who I won't name. As giving air to the ones that remind me of empty vessels just seems to encourage them. Filtering would be good.
And have it reformatted so I can see more on a page. When there are multiple responders to a thread, the result is fairly ugly at the moment
Haven't searched the web site for a little while. If you have added the features where you can search for a userid's contributions - so I can see what the likes of Stephen Hulme or Andrewj are up to, then that would be good.
Gibber
Many thanks for those comments. Interesting thoughts. The pay as you go isn't technically possible at the moment.
Interesting idea on filtering out commenters (!) and being able to search.
Maybe I should give AndrewJ and Stephen Hulme their own blogs? (!)
cheers
Got me thinking.
Bernard
Bernard .. was trying to be helpful .. in my opinion .. interest.co.nz is one of the best financial sites going around in australasia .. better than "business spectator"
While you were away Fairfax Media made a takeover offer for business spectator of $20 million and business spectator doesn't have a paywall .. Kohler reckons they don't work.
I recommend decorum .. a muted pastel colour theme, and test drive them (the advertisements) first
Bernard. I have unlimited cable broadband .. the size of the image behind the link is in excess of 1 mb .. it takes a long time to load .. it loads first .. not last .. and this what i get for about 2 to 3 seconds before the rest of the page loads .. see the attached screen-shot .. try test driving that on a slow connection .. http://www.members.optusnet.com.au/~iconoklast/hickey-triton.PNG
Was keen to post the above link somewhere. The data from China, based on this, does not look healthy. Add this to Europe and US issues, and we have a potential storm.
They will all probably throw new money at the issue; whether that will solve things time will tell. A significant risk that NZ will be collateral damage, unless we follow suit.
The lesson for New Zealand in my opinion seems somewhat urgent; and will need some bold Government and Reserve Bank work. Unfortunately our esteemed representatives seem to be staring at the headlights.
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