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Obama to win fast-track authority; Aust commission slams FTA impacts; Greek deal less certain; China ends key regulation; OECD worried; NZ$1 = 68.9 US¢, TWI-5 = 72.7

Obama to win fast-track authority; Aust commission slams FTA impacts; Greek deal less certain; China ends key regulation; OECD worried; NZ$1 = 68.9 US¢, TWI-5 = 72.7

Here's my summary of the key issues from overnight that affect New Zealand, with news of a sharp attack on free trade agreements.

But first, President Obama’s aggressive trade push is back on track, after several near-death moments, in large measure because top Republicans have stood by him. He now seems almost certain to get 'fast track' authority. And when that happens, the focus will shift back to the actual TPP negotiations with countries like New Zealand.

Meanwhile, in Australia, their Productivity Commission has launched a scathing attack on Australia's latest series of free trade agreements, saying they grant legal rights to foreign investors not available to Australians, expose the government to potentially large unfunded liabilities and add extra costs on businesses attempting to comply with them.

The other big negotiation is going on in Europe and there are uncertainties are fast resurfacing over whether a Greek deal will actually emerge this week. These doubts are knocking equities in the big markets and raising bond yields.

In China, they are about to end their loan-to-deposit regulation, which was set at 75%. They expect the new freedom for banks will enable them "to increase lending to agriculture, small and micro-businesses". But as we know, bankers tend to follow the 'big money', so this one will be worth watching.

And in a new report out overnight by the OECD, they say the current low interest rate environment poses a significant risk for the long-term financial viability of pension funds and insurance companies, as they seek to generate sufficient returns to meet their risk-aversion promises. In this environment, to get the returns they need, they are taking on new and destabilising risk, the OECD finds.

And the IMF said yesterday that the Australian Reserve Bank should be ready to cut interest rates again if their economy falters.

Back in New York, UST 10yr benchmark yields rose and are now at 2.40%.

US oil markets are marginally higher with the US benchmark price just over US$60/barrel, and Brent crude is now just over US$63/barrel. American crude stocks dropped for an eighth straight week but there is a sharp rise in refined products unsold. US petrol prices are now not expected to rise during this year's summer driving season.

The gold price fell another -$3 to US$1,173/oz.

The Kiwi dollar has risen overnight against the greenback and starts today at 68.9 US¢, gained quite a bit against the Aussie and Euro at 89.4 AU¢, and 61.5 euro cents. The TWI-5 is now at 72.7.

If you want to catch up with all the local changes yesterday, we have an update here.

The easiest place to stay up with event risk today is by following our Economic Calendar here »

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30 Comments

Greek dont like the deal,

http://www.nytimes.com/2015/06/24/world/europe/greek-debt-blueprint-get…

"ATHENS — Prime Minister Alexis Tsipras faced anger and resistance on Tuesday from members of his own radical left political party, complicating his efforts to strike a deal this week with Greece’s creditors, as some lawmakers and party officials criticized concessions by the Greek side and expressed doubts about voting for a deal in Parliament."

oh boy....

How about a poll on Greek exit this year?

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FTA's where civil servants sell out their own country ( are there treason laws against these acts?) We have been trying to sign a TTP with US for 30 years, why is it happening now? Is it desperation by the US? A bunch of struggling economies trading with each other will make us all rich? ( i have my doubts). Lots more credit expansion on the way from China, wow! how much bigger can the bubbles get? The Greeks should hand over their children to the Germans as slaves and all debts will be forgiven. On the whole everything looks positive..

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One of the (many) reasons I don't like this TPP.

https://www.youtube.com/watch?v=-Gg3vlttE9M&feature=youtu.be

Trade deals like the TPP, T-TIP, and TISA are solidifying a new legal structure called Investor-State Dispute Settlement (ISDS), which allows multinational corporations to nullify national laws and overrule their supreme courts, including ours here.

Some of these big multi-national companies have a budget bigger than NZ, and can take us to the cleaners in those "kangaroo courts"

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Good link above.

I watched Paul Henry this morning interview Grosser. It would be the first interview of Grosser from recent memory regarding the TPPA.

Henry was a joke and downplayed the whole issue, Grosser couldn't even give an answer to what benefits it would bring NZ. Henry failed to challenge him and the govt as to why we are even considering this trade agreement.

It was like watching the Breakfast Show on Channel 1 with common pleasantries and feeble jokes the norm.

Sadly, most people (like Henry) consider this dull and continue to ignore the impact it will have on our country for future generations.

But then again, the next X-Factor and DIY show will have us glued to our televisions while our country sells it's sovereignty to the new world order.

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This is where so many people are in error; please note there are no longer any civil servants. Its every ministers wet dream to run their ministries (especially the super ones!!) as their very own faux/fiat blue chip. Look at the terminology, look at the structures, look at the 'commercially sensitive' shielding of information.

We are being sold-out, thats for sure. But not by public servants, but by the new class of modern day feudal overloads. They know best so relax, lie back and take your globalisation like a good boy.

PS;Look at how our borough councils morphed into territorial "Authorities'; where are the servants in that set-up. Heres a clue; look in the mirror.

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Obama, What a guy! I'm so glad Americans voted for him (twice) because of his commitment to our rich western history of freedom, democracy and his total respect of the Magna Carta.

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And you would prefer another George Mission Accomplished Bush I suppose. His invasion of Iraq is going to bring down the whole Middle East. At the end of the day (my god I am starting to sound like the Pm of Parnell) I suppose if the best America can come up with is dynasties like the Kennedys, Clinton or Bushes then it is no surprise the mess they get into.

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We need a constitutional law expert to define treasonous actions by our government servants and what steps citizens/organisations can take to bring them to justice. David, can you arrange that?

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bender - sorry but we have no constitutional rights.
When a country gets its independance it is supposed to have an interim government until the people vote on a constitution then hold elections under that constitution.
Notice how NZ does not have an Independance day?
That is because the British government handed over control of NZ to its mates (both pakeha and Maori) and they stole the country from all NZers
Now the only rights we have, including human rights, is dependant of our government. It the government wants to ignore human rights it can, because it is a thieving boss.

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That means you can't commit treason either Mike.

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For anyone who wants a simple to understand cartoon on tppa http://economixcomix.com/home/tpp/

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Good cartoon!

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Absolutely brilliant!! Can we send this to all MP's including the Prime Minister just to remind him there are some NZer's that see through their BS!

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Yes sorry, comic.

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I do like what it says on page 9. "Theory Induced Blindness" as proposed by Daniel Kahneman. That logic is so compelling that it is easy to ignore or forget (or not understand imo) its assumptions.

That's is a big part in what I explore and explode. Why I keep calling all the "Experts" on their education or predictions.

The more one has [educational] expertise, the more likely one is to not going to double check for assumptions, feeling justified by other experts and proofs. And this becomes a russian roulette process. the more times one wins the less easy it is to believe in a possibility of failure...until it happens; but then it is too late. So when the parties involved rely on significant difference of policy or values and keep pulling the market and peoples' lives backwards and forwards to force a fit, everyone loses.

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Power of the people against the Government

Possibly the most significant event overnight - with wide ranging implications

Campaigners brought a case on behalf of almost 900 Dutch citizens. They argued the government had a legal obligation to protect its citizens from the dangers of climate change.

Government has an enforceable duty to its citizens

A Dutch court has ordered the government to cut greenhouse gas emissions by at least 25% by 2020, in a case environmentalists hope will set a precedent for other countries.

http://www.bbc.com/news/world-europe-33253772

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Do listen to this interview with John Casey.
He is far more worried about global cooling and a next mini-ice age.

He is a former White House space program advisor and consultant to NASA, and systematically debunks the propaganda-driven myth of runaway global warming and explains why he, along with many of the world's top scientists, agree that Earth is on the brink of a cataclysmic ice age that will result in massive food shortages and social upheaval.

https://www.youtube.com/watch?v=ppaNFX0961U

Climate change has been a perplexing problem for years. In Cold Sun, author John L. Casey, a former White House national space policy advisor, N.A.S.A. headquarters consultant, and space shuttle engineer tells the truth about ominous changes taking place in the climate and the Sun. Casey's research into the Sun's activity, which began four years ago, resulted in discovery of a solar cycle that is now reversing from its global warming phase to that of dangerous global cooling for the next thirty years or more. This new cold climate will dramatically impact the world's citizens. In Cold Sun, he provides evidence of the following: • The end of global warming • The beginning of a "solar hibernation," a historic reduction in the energy output of the Sun • A long-term drop in the Earth's temperatures • The start of the next climate change to decades of dangerously cold weather • The high probability of record earthquakes and volcanic eruptions A sobering look at the Earth's future, Cold Sun predicts worldwide, crop-destroying cold; food shortages and riots in the United States and abroad; significant global loss of life; and social, political, and economic upheaval.

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"space shuttle engineer" vs. actual climate scientists. I am a former weather satellite engineer and consultant to NASA and am instead very concerned about global warming and all the specific data confirming same vs. a four year study of sun cycles.

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Done properly people should be looking at "green" environmentally friendly processes rather than just chasing CO2 emissions. Not growing the demand for more farmland and higher productivity, especially high end productivity for food and jobs, should be a priority, rather than debating climate issues.
It doesn't matter if climate is heating or cooling, an LED bulb will require less greenhouse gas production to run AND require less energy input to support in global cooling. Same as double glazing and fuel emissions, and reduction of short-life consumables. doesn't matter if it goes up, down or stays the same, they're benefical so it makes sense to make a start with those steps especially if it doesn't create massive social upheaval (it doesn't take much to use LED bulbs or turn off electricity you're not using) far more than to push everyone into high density human heated towers for resource management purposes. So the former needs immediate pursuit, the later a future design "nudge"

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Um, 99.9% of climate scientists agree there is climate change, or out of 17,000 odd papers recently reviewed only 3 didnt agree. John Casey however doesnt seem to publish anything at an academic level, "Casey's work has never been published in a peer-reviewed academic journal, only self-published on the internet."

and,

"University of Miami climate scientist Dr. Benjamin Kirtman told New Times this about Casey's work:

It looks to me that Casey is confused about global dimming, which actually seems to be in a reversal... As for the "global cooling" Casey is arguing for, all evidence is to the contrary. Indeed, ocean heat uptake has continued to steadily rise since the 1950s, and there is no plausible physical process (including changes in solar output) that would end this trend in the near-term (10-30 years). Casey's "Summary Climate Assessment" has some unsupportable statements. For example, Casey's assessment states that "Integrated Global Atmospheric Temperatures continue to show a long term COOLING trend that began in 2007. (100 year trend)." This is untrue (by far, 2001-10 is the warmest decade since the 1850s) and it is not mathematically possible detect a 100-year trend with seven years of data. The assessment goes on to state, "The rate of oceanic temperature decline has been slightly reduced over the past year but is expected to continue its long-term decline." This is also untrue -- July 2014 ocean temperatures are the warmest on record."

At some point you seriously should be wondering about the ppl who deny climate change.

PS actually 5 out of 24,000 papers,
http://www.msnbc.com/msnbc/how-climate-change-deniers-got-it-very-wrong
PPS oh and the 4 "Powell called the four dissents “known deniers and crackpots”

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Everyone should just get a heat pump then it does matter which way temps go we can still be comfy. Until life in the ocean dies due to acidification. The temp is warming currently there is no doubt could it switch over to cooling well anything is possible but unlikely. The real issue is the ocean is dying if the life in the ocean dies off we all do. We need to stop emitting CO2 asap. Luckily the big boys have agreed to stop emitting co2 by 2100, so we have nothing to worry about (on account of being dead by then).

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o^O

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That announcement was just hysterical, they sounded like a bunch of circus clowns. So fossil fuels is effectively gone by 2050 anyway and given the age of the Gxx leaders not one of them (or maybe Obama) is likely to be alive in 2050 let alone 2100.

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Now your dreaming if you think your heat pump is gonna keep you warm in an Ice Age! What are you gonna do when the snow and ice pile up on the power lines until they come down? So don't go thinking that you will be comfy because you want be!!

Obviously you have never lived in remote locations where snow and ice rule your life in winter.

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A heat pump, with enclosed solar capture/wind generation is a better bet than wood, coal, or fossil fuels.
However the migration period would probably see most humans die out anyway.

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.

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who funded the five papers denying climate change I wonder?

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Well there are 2 aspects, a) indeed funded, b) some ppl have a pure political or religious outlook that drives them. after that well I guess a mixture.

For me I look at what the deniers are presenting and I am gob smacked at times how careful and detailed cherry picking they do. eg sometimes its very specific point say picking 1995 as a start year of a trend and not 1994 or 1996 just to get a flat line that appears no where else in 50 years of data. For ppl to do that they have had to look at the papers and data in significant detail and run the numbers until they get their best possible result, yet still deny it.

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Best guess: the Koch brothers.

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could you even imagine the box-tickers in NZ Courts going up against our government....?

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