Here's my summary of the key events over the weekend that affect New Zealand, with news that Warren Buffett is front and centre today.
But first, sales of new single-family houses in January in the US were +5.5% higher than the same month a year ago. But markets had expected an even better result, so there was a sense of disappointment about this result.
Also a bit disappointing was the latest American consumer confidence reading by looking like it has topped out. It also did not show a rise in inflation expectations.
In his annual report to shareholders, billionaire and investment icon Warren Buffett reported higher profits even as operating income slipped. He was his typically optimistic about the prospects for American business generally. However, in advice to savers and investors he delivered a black eye to the managed funds industry, urging ordinary investors to buy plain-vanilla index funds. He highlighted a bet he has on the matter with a large hedge fund manager which looks like it will pay off big-time. He also had harsh criticism of the current fad of companies who report earnings stripped of certain elements, claimed to be one-offs.
In Sweden, that have abandoned the centre-left Government proposals for a new tax on banks. It was strongly resisted and fears grew that Swedish jobs would be moved off-shore. Instead, they are to move ahead with a plan to force healthy banks to pay into a fund to cover competitors who fail. (Over the weekend, Sweden also abandoned a Green Party plan for a 'kilomtere tax' on heavy trucks.)
In Melbourne, there is some serious landlord pain. Landlords have been hit by steep land tax increases from soaring property values, in some cases more than doubling tax bills and making investments uneconomic. In the State, retail tenancy laws prohibit landlords from passing on land taxes to their tenants, unless the tenant is a listed company.
And staying in Melbourne, the ex-boss of ANZ has finally sold his Toorak home for AU$13 mln in a long-running saga where the original buyer from China failed to get approval to make close the deal. Mike Smith settled for a A$2 mln haircut.
In New York, the UST 10yr yield is falling and now at 2.32%. There seems to be renewed downward pressure on interest rates. Bond traders are showing more concern about politics while equities traders like what they see on earnings. We should also note that the risk premium for investment grade Australasian debt continues to fall, as measured by credit default swap spreads. Bank wholesale debt transaction costs are going down. This mirrors the impressive position NZ sovereign debt holds in the same markets. We are pitched better than most large countries including the USA, Germany, Australia. and in a group with Switzerland, Sweden and Norway
Oil prices are lower and now just under US$54 for the US benchmark, while the Brent benchmark is just under US$56 a barrel.
The gold price is up a little further at US$1,257/oz.
And the New Zealand dollar will open the week at 72 USc. On the cross rates we are at 93.9 AU¢, and against the euro at 68.2 euro cents. The NZ TWI-5 index is now at 77.5.
If you want to catch up with all the changes on Friday, we have an update here.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».