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Gareth Vaughan gets lost in a fictional world full of fairies, rainbows and unicorns where banks use cheap public money in ways that make New Zealand a better place

Gareth Vaughan gets lost in a fictional world full of fairies, rainbows and unicorns where banks use cheap public money in ways that make New Zealand a better place

By Gareth Vaughan

Wouldn't it be great if the country's banks used the up to $28 billion of cheap funding they're eligible for courtesy of the Reserve Bank's Funding for Lending Programme to actually make New Zealand a better place?

Before you dismiss me as being away in some fictional world full of fairies, rainbows and unicorns, please hear me out.

In December the Reserve Bank made the Funding for Lending Programme, or FLP, available to banks. Through FLP banks have access to billions of dollars worth of three-year funding priced at the 0.25% Official Cash Rate over a two-year period. Banks can borrow the equivalent of up to 6% of their total outstanding loans. 

That means big banks such as ANZ, ASB, BNZ and Westpac can potentially borrow billions through the FLP at 0.25%.

The FLP is designed to provide additional stimulus in response to the COVID-19 pandemic, with the aim of reducing banks’ funding costs - including the deposit rates they pay savers - and lowering the interest rates banks charge their borrowing customers. This, the argument goes, will encourage banks to continue creating credit by lending in an uncertain world and stimulating economic activity.

Banks largely have carte blanche to do what they like with the FLP money. A bank could, for example, borrow from the FLP and on-lend to property investors adding further fuel to a red hot housing market. Or a bank could use FLP money to pay down more expensive existing funding.

ASB's pledge

So far just three banks have accessed FLP money, tapping it for $1 billion, $100 million, and $40 million, respectively.

Whilst ASB's not one of the three, it has publicly outlined some of its plans for the cheap funding. On Wednesday CEO Vittoria Shortt told me ASB will be borrowing FLP money in 2021 and initially plans to focus it on loans for businesses trying to lower emissions, for construction of new energy efficient homes thus helping increase housing supply, and for supporting infrastructure especially in regional NZ.

Perhaps this is just good public relations from ASB and it will be impossible to track what the bank actually does with the FLP funding it accesses. But on the face of it the three areas highlighted by ASB sound like worthy places to spend public money, which is what FLP funding is. Albeit don't call it taxpayer money as the Government hasn't handed the Reserve Bank billions of dollars worth of tax revenue for it to lend to banks. Rather it's new money created by the central bank, which issues money on behalf of its government owner.

Notably the FLP comes at a time when the Government is under pressure to do something about the housing market and significantly step up NZ's response to climate change. On top of this, there are always worthy infrastructure projects around the traps seeking investment.

So what if the other major banks decided to join ASB and use FLP funding for the likes of housing construction, combating climate change and building infrastructure?

Given the banks get FLP funding for 0.25%, all the mysteries true bank funding costs can be wrapped in, such as converting overseas funding into the NZ dollar and bringing it back here, are unmasked. We know precisely what the banks are paying for this funding. 

Thus if banks choose to lend FLP money for specific types of borrowing, as ASB has indicated it will, their customers should be getting very low interest rates indeed. And here I reiterate this is public money the banks are receiving. 

However, you wouldn't guess this from the attitude adopted by the Reserve Bank. It won't name banks accessing FLP meaning it's up to the banks to out themselves.

 The Co-operative Bank CEO David Cunningham outed his bank as tapping FLP for $40 million. This, Cunningham says, is being used to fund a first home buyer mortgage offer with a one-year interest rate as low as 2.09%.

Kiwibank joined The Co-operative Bank when I asked yesterday with a spokeswoman saying; "Yes, we have used the FLP and expect to continue to use it, along with other funding sources, to support lending activity in 2021."

Whilst a spokesman confirmed ANZ's yet to access the FLP, spokesmen for BNZ and Westpac wouldn't say whether their banks have. Thus we have at least two of the country's big four banks unwilling to tell the public if they're sourcing public funding and if so, what they're doing with it. And this is hunky dory with their regulator.

This attitude does tend to pour cold water on my hopes our big banks might use cheap FLP funding to help make NZ a better place. Maybe I was lost among fairies, rainbows and unicorns for a moment there after all.

Or perhaps they're waiting to see what a Labour government with a big parliamentary majority will do about housing and climate change? Or maybe they're even worried about showing up the Government?

Auditor-General John Ryan estimates about $18 billion of the Government's so-called $62 billion COVID Fund has made it out the door to date. Of this, more than $15 billion has been spent on the hugely successful Wage Subsidy, helping limit unemployment, and the Small Business Cashflow Loan Scheme. Other spending has been on COVID relief payments, health, the Air NZ loan, help for the tourism sector, and the Business Finance Guarantee Scheme.

So even in these extraordinary times Finance Minister Grant Robertson and Prime Minister Jacinda Ardern have shown themselves to be small-c conservatives when it comes to government spending. 

Building back better?

In his first major speech of the year this week Robertson spoke of a "crisis in housing" and pledged "a rolling series of measures" focused on demand and supply. Noting Real Estate Institute of New Zealand figures show the national median house price rose 19% in 2020, Robertson said; "...now is the time for bold action. The market has moved quickly and rapidly in a way that is not sustainable. We have to confront some tough decisions, and we will do that."

Whether this iteration of the Ardern-Robertson government is able to successfully tackle housing affordability woes after ineffective attempts by successive previous governments remains to be seen. So far the signs aren't encouraging.

In coming months we'll also learn just how far the Government is prepared to go to tackle climate change, which according to Ardern is the nuclear free moment for her generation. Remember the Climate Change Commission estimates transitioning to a cleaner economy will cost $34 billion over the next 14 years with big changes required in the transport, agriculture, energy and waste sectors.

In his speech Robertson boasted of lower government debt than previously forecast.

"Projections at the time of the Pre-election update in September showed net debt falling from a peak of about 56% of GDP [Gross Domestic Product] in 2024 to 48% of GDP in 2034," Robertson said.

"New projections using Treasury’s Fiscal Strategy model today show net debt now at 36.5% of GDP in 2034/35. That represents about $60 billion less debt at the end of the projection period than at the pre-election update."

Put another way that austerity mindset means billions of dollars less in spending by our currency issuing and self proclaimed progressive government at a time of record low interest rates. And when, in Robertson's own words, the Government wants to build back better from COVID. What will that mean for housing, infrastructure, climate change and child poverty?

Even if Robertson's action on housing really turns out to be bold, the Government could still use some help from big banks flush with cheap, public money. But perhaps I really am away with the fairies if I'm hoping the Government and banks could work together to tackle the issues that really matter for NZ. For now though I'll keep my fingers crossed.

(For what it's worth, interest.co.nz's best guess is Westpac is the bank that has tapped the FLP for $1 billion).

*This article was first published in our email for paying subscribers early on Friday morning. See here for more details and how to subscribe.

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83 Comments

Buy bitcoin. Like some other banks start to do

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Yeap. Solid choice. The pandemic proved that governments all over the world can just print the cash, faster than bitcoins were ever generated.
In time, bitcoin will be the only recognized currency in the world.

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Irrelevant to Gareth's article. Regardless, banks are not buying Bitcoin, unless you call PayPal a bank.

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I certainly wouldn't broadcast my intention to buy Bitcoin if I was a bank.... until.... I had established my position.

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Grant Robertson being the Minister of Finance and the Minister of Infrastructure has some big decisions to make this term of government.

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Hear him say before election no to changes tax on investment property. Apparently that's all changing. Starting to sound like trump or is it not lying?

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I'd be surprised if he has to. I've come to the conclusion they will not make any big decisions unless absolutely forced into it.
Sad.
I'm almost at the point of wondering if National may have been better. Don't actually believe it but I'm not sure anymore.

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Same here. I voted for Labour and have big regrets. The FLP $ should have had conditions, ie for business, R&D, etc. For young home buyers, KiwiSaver funds are not always enough - just like me (a retiree), they need interest from TDs to get to a deposit.

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Edward, I'd genuinely like to know what were your drivers for voting Labour after their previous term. Was it a counter vote against the Greens, a shambolic and amateurish National, an untrustworthy NZF?

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Hook, it was because of their Covid performance. At the time National were a basket case. I realise now that they (Labour) don't know how or don't want to fix the housing crisis.

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Well thanks for your honesty Edward. Appreciate your rely.

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Businesses, including banks, operate within the economic and legal constraints placed upon them. It's unlikely that a conservative, incrementalist government would change those constraints rapidly. You won't see mass housing development or new energy projects because government has not laid the groundwork for that transition. Our entire legislative system works to resist change, even when it is urgently required.

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Lessons from Noah
It seems mass housing development or new energy projects might run into problems that Noah would have if he tried to build the Ark today:
http://www.appleseeds.org/noah_today.htm

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RBNZ should pull FLP if it's not needed & simply used by banks as a PR exercise. They should have included restrictions on how the funds were used. Embarrassing really...

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To a Keynesian - money out the door is the only moral righteous ethical consideration when running an economy.

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Cute pic!

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The FLP money may not be 'taxpayer money' but it is 'citizen money'. One way or another, the fairies that provide it are you and me. It is inevitably a form of fiat currency debasement, and it is also distortionary in the economy.
KeithW

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The money that the banks themselves create is far more distortionary as we see with house prices.

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Credit creation by commercial banks operates within a framework determined by the Reserve Bank. Accordingly the commercial banks are simply the opportunists that operate within the rules set by the Reserve Bank. Within that framework they then work according to the standard business maxim of maximising profit within the risk parameters as they assess them

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Credit creation by commercial banks operates within a framework determined by the Reserve Bank.

Retail banking in the Anglosphere in particular is the most privileged business on the planet. You can see why people fight to get to the top of that food chain. Money for jam lending money into existence. If it all goes tits up, there may be some public penance to pay, but the taxpayer ultimately has to clean up.

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Yes, apart from property, banking and the broader finance industries have been the businesses to be in over the last 25 years.

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This is why we can't have nice things

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The achilles heel of NZ economy, collective held hostage by the OZ banking cartel - the way it is for now, the more prudent regulatory approach should start there. Right now? it's just stay as 'moral obligation' or 'duty of care to society' or 'social obligation' etc. - which means nothing to the Banks.

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"Building back better?"

We did that. It's called Christchurch, and yet we did nothing with it except rebuild some smart new bars and restaurants to service a miniscule clientele. We ploughed untold billions of dollars worth of debt - future income pre-spent or spreadsheet liabilities, no matter how it's viewed - and didn't relocate our ageing, vulnerable economic infrastructure situated elsewhere; Parliament etc there. Nope. We are just waiting for the next one to hit. And it will.

"Powerful earthquake rocks Fukushima in Japan" (this morning)

But not to worry!

We've replaced all the debt and savings that we used to re-build Christchurch; Balanced our Current Account; de-risked our financial markets so that in the worst case scenario those who do lose their houses don't have to spend the next 12 years repaying their debt, just 3 times the yearly average income, and bolstered our economy against all sorts of 'instability' - Adrian's told us so (or is that what keeps him awake at night these days? Nope He's blissfully ignorant and sleeps like a baby)

The last thing New Zealand can afford, right now, is an 'unexpected' natural disaster. Yet they continue to arrive in the Pacific region, where we reside, on a daily basis.

Are we prepared? Have we; The Shaky Isles, 'Built back better" in anticipation of the inevitable?
Like Hell, we have.....

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Whilst I agree with you, bw, that much of the rebuild decisions (made by the central Government via the Christchurch Earthquake Recovery Agency - CERA) were missed opportunities and biased toward hospitality and tourism. However, we did have SCIRT which spent billions on underground repairs. Much of the pipework has been replaced, pump stations improved and flood control reworked. Christchurch is in a much better infrastructure position than other NZ cities. These billions were spent on something that doesn't show (as it's below ground) and citizen only notice when it fails to work properly. I suspect these are the reasons that this work is neglected elsewhere.

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I despair. Even sh*t flowing in the streets of Wellington isn't enough to get our government to be "transformational". Surely it is obvious that the inhabitants of Wellington or Auckland or anywhere else, can't pay for the vast sums that need to be spent on our disintegrating infrastructure.

We now know that our debt/GDP ratio will be much lower than expected and borrowing costs are low. I agree with bernard Hickey when he talks about inter-generational theft in not addressing these issues, including housing. We are a greedy bunch. We want all the trappings of a first world economy-great healthcare across the country, world-class education, good infrastructure, more police and so on-BUT we don't want to pay for it. Oh, i forgot climate change, but hey, let's just push that little problem down the road too.
Tax our vast property gains in the name of greater equality? Pigs at the slaughterhouse couldn't squeal louder.

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I agree with Irish economist David McWilliams. “Housing should be addressed with the same urgency as public health. If we can close down the economy, borrow billions, furlough millions and stop the world in the name of public health, we should be able to tear up the rule book when it comes to housing. The property market in Ireland and the rest of the English speaking world is a scam, rigged to push prices upwards, indenturing working families and exacerbating the wealth divide.”

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McWilliams one of the few to predict the collapse of Irish housing.

“In Ireland, economist David McWilliams (centre) warned unambiguously about the unsustainability of the boom as early as January 1998, when he wrote that ‘fundamentals count for nothing if your house is built on a bubble’ and pointed to the fact that mortgage lending in Ireland ‘has been growing at 15 per cent per annum for the past four years. This cash has been funnelled with the help of significant fiscal incentives, into bricks and mortar, pushing, as we all know, prices through the roof. On top of this, general credit in the economy is up more than 20 per cent in 1997 alone. A quick glance at property prices suggests that we are definitely entering asset-price bubble territory’. Until the crash, McWilliams has been one of the few analysts in Ireland to warn publicly and explicitly about the growing housing bubble and its eventual collapse. Another Irish analyst to have done so is Morgan Kelly (above). He looked at nearly 40 property booms and busts in OECD economies since 1970 and showed that there is a strong relationship between the size of the boom and ensuing bust: typically, ‘real house prices give up 70 per cent of what they gained in a boom during the bust that follows.”

“Kelly observed that, between 2000 and 2006,house prices in Ireland had doubled relative to rents, while the price-to-income ratio had also significantly outpaced its historical level. This showed that Irish property prices were no longer sustained by fundamentals such as rising employment, immigration or rising income. He predicted a fall in real house prices of ‘40 to 60 per cent over a period of 8 to 9 years’, which seems relatively accurate as of this writing.”
and in March 2006 http://www.davidmcwilliams.ie/financial-markets-attempt-to-stop-the-run…

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McWilliams recommended this year is the Irish government borrows long duration debt (like 50 years) at super low interest rates and builds public housing where the rent is no more than 30% of income. By his calculations this is doable in Ireland without any more subsidy than accessing cheap government debt. He explains it well here.
https://open.spotify.com/episode/04xBCx8ZZdpbT4x31Rmz21?si=PKP-Wd2-S5ux…

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Of course Ireland does not have a sovereign currency, it uses the Euro and so its deficits must be funded by borrowing from the ECB. Our government though does have a sovereign currency and so it does not need to borrow at all. Economist Warren Mosler has this to say.
"I would cease all issuance of Treasury securities. Instead any deficit spending would accumulate as excess reserve balances at the Fed. No public purpose is served by the issuance of Treasury securities with a non convertible currency and floating exchange rate policy. Issuing Treasury securities only serves to support the term structure of interest rates at higher levels than would be the case. And, as longer term rates are the realm of investment, higher term rates only serve to adversely distort the price structure of all goods and services".
"I would not allow the Treasury to purchase financial assets. This should be done only by the Fed as has traditionally been the case. When the Treasury buys financial assets instead of the Fed all that changes is the reaction of the President, the Congress, the economists, and the media, as they misread the Treasury purchases of financial assets as federal ‘deficit spending’ that limits other fiscal options."
https://www.huffpost.com/entry/proposals-for-the-banking_b_432105?gucco…

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On August 30, 1924, a monetary law permitted the exchange of a 1-trillion paper mark note to a new Reichsmark, worth the same as a Rentenmark. By 1924 one dollar was equivalent to 4.2 Rentenmark.

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Did Germany not loose WW1 with a collapse in its economic output and massive war reparations to repay? What point are you trying to make? Whether currency is held as bonds or bank reserves makes no difference to its value.

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And what point are you trying to make? That MMT explains everything and the sovereign currency issuers have somehow found a holy grail? Maybe you're right, but what you are seeing in NZ right now is not necessarily a positive outcome.

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The point is that we are all deliberately mislead and made to believe that the government is financially dependent upon the private sector to finance it. Borrowing does not finance the government and it serves no useful purpose as Warren Mosler tells us.

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In McWilliam's opinion the state should give the clear message to those in need of affordable housing that the state had their back - like they did in the past - 1920s to 80s - when Ireland had significant council house building with strong political support from progressive political parties. That Ireland like Germany should see unaffordable housing as a cost to the economy which impeded productive investment in industry, added unnecessary labour costs etc. McWilliam said it is important that political support for affordable housing had an income 'anchor'. For him that meant a target for new public housing was that it cost no more than 30% of household income. He indicated the state should access and provide land if needed and building out in the boon-docks like Ireland did in its pre-GFC building boom would be a mistake.

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I believe Ireland didn't have a housing shortage caused by , among other things, unchecked immigration for 20 years.

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'In his first major speech of the year this week Robertson spoke of a "crisis in housing" and pledged "a rolling series of measures" focused on demand and supply ' Really ?? Are they not 4 years into being in Government and the same old dribble still comes out ! Robertson going for headlines ( votes ) Speculators are the problem and we will fix it YEAH RIGHT ! Differently a 2 term Government !

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And worse.
Even if he does 'do something', how is he going to explain to those New Zealanders that have panicked into buying whatever came to market, this week or last, that whatever it was they have committed decades worth of their labour to repaying, is going to be subject to "new rules", that will apply tomorrow and not today, and that might inhibit their chances of recouping what they've paid?

Seriously. You couldn't 'manage' a social and economic disaster any worse than what this and the immediately previous Governments of all colours, have done.
2007. We had a shot at all sorts of long overdue, obvious reform. Key didn't act. I had sadly misplaced confidence he would. No Government has acted since, and to expect any to do so now is fantasy.
(for the aforementioned reason - its political considerations that matter, not people.)

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What astounds me is all that had been done "because covid" yet govt seems manifestly unable to apply 'because covid' logic to retract no-new-tax announcement of the pre covid era

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And change the hair-shirt discussion about government debt - which is not the problem - private debt is NZ's problem.

Given interest rates are virtually nothing and there is a massive infrastructure need to fix the housing crisis and to meet climate change commitments surely now is the time to borrow big for as long as the market will lend (debt maturing after 2050 would be good) and at as low an interest rate as possible.

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Why should the Banks be given this cheap money in the first place ?
Why protect their profits ? Which is going to Aussie anyway.
Totally wrong, in my view.
Start a Development Bank here and use these funds for Infrastracture projects, Build more Universities for Medicine, Technology Free Zones, etc. Which would increase employment and give a boost to the Economy long term.
Giving to the Trading Banks to increase lending to Housing is a travesty.

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If cheap money was for new builds and housing-related infrastructure it would be ok. But lending to capital gain obsessed property investors and fear of missing out FHBs is just stupid. There is a long term hit productivity - it does bad things to the labour market. Even worse is the risk of NZ fracturing into a permanent wealth divide. Our political leaders cannot keep kicking the can down the road.

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Just watch

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I see your point - our politicians are expert can kickers. But maybe they shouldn't be...

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We have Kiwibank. Unfortunately for the last few years their profitability has, well they've had a very rough patch.

They have gone 'woke' though so maybe they're going for 'broke' next? Logical.

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Kiwibank is the biggest oxymoron in NZs banking infrastructure

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What should banks do with all the cheap public money the RBNZ's FLP offers them?
Hmmmm....what money?
The FLP term sheet explicitly states the RBNZ is engaging in a repurchase agreement with banks - the banks sell investment securities (NZGBs & RMBS etc) with a liability to repurchase them in three years time at a cost determined by OCR, plus any haircut.

Effectively, the RBNZ is transforming, possibly expensive, short term bank debt into cheap, for now, term debt. Core funding (CFR) is defined as retail deposits plus wholesale funding with maturity of more than one year. And in the process manipulating the money market yield curve flatter for longer. Hardly a growth prognosis.

A review of this accounting diagram Exhibit 2 (secured borrowing) sets out the reality. Thereafter, banks engage in their normal lending procedures to grow their balance sheets by exchanging IOUs with preferred borrowers supposedly at a lower interest rate, which is extracted from depositors in lower returns when they are in receipt of bank IOUs, masquerading as savings, when assets and goods change hands.

Unfortunately, depositors are unsecured creditors, no recourse to collateral for them, in receipt of returns that do not reflect the risk taken. The government should know better and take steps to defend citizens from such exposure.

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The government should know better and take steps to defend citizens from such exposure.

Yes, in fact introducing a deposit guarantee scheme immediately is fair, puts us on a par with other developed economies and would likely reduce pressure on the housing market as well.

If they do not do that... savers need to take to the streets and expose the fraud and ill-will they are demonstrating to all those in society who have lived sensibly, sustainably and prudently.

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I came for the rainbows and unicorns, but stayed for the great article; Thanks Gareth.

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I don't believe ASB for a second. The FLP money will go into the general pot and be used to pump out cheap mortgages.

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Of course it will. But it sounds good, especially when one Mr Carr is a director of the ASB - gotta beat the competition's PR.

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So trying to cajole the financial sector into doing the right thing is the answer? Seriously?

A ‘transformational’ Govt would seize the opportunity of global turmoil, irrelevant credit agencies, rampant state aid across the world, and zero interest rates to get ahead of the curve and invest *directly* in the medium to long term infrastructure that the country needs to be successful... Fix the pipes, build the cycle ways, fund the infrastructure needed for housing development, build houses for affordable rent, create the jobs and apprenticeships in the forgotten towns, prepare for high end tourism, fence off the streams on the dairy farms, plant your billion natives trees....

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My vote is on you Jfoe to be the finance and infrastructure minister.

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Seconded. These all sound like good ideas.

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Agreed, except for the cycleways - they must be the most expensive transit corridors (on a per head of use basis) of them all

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They have built a cycleway alongside the Southern motorway from Manurewa to Papakura, it would have cost millions. There is already a cycle lane on the Great South Rd through Takanini and I have yet to see any one use it and I am a regular on this route. Blind faith or stupidity with other peoples money?

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NZ doesn't know how to build proper cycle networks that large chunks of the population will use.
https://www.youtube.com/watch?v=Uhx-26GfCBU&feature=youtu.be

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Brendon, cycleways (in the main centres) have always been constructed at the expense of existing roadways. The collective 100's of millions spent (possibly billions) hasn't seemed to have attracted the mass uptake of cycling that was promised. Imv they are a complete waste of money - money better spent on improving the availability and most importantly the reliability and predictability of public transport (rail and/or bus). Let's face it - in NZs climate (and topography) only the hardiest cyclist would bike to work in the p@ssing down rain or home in 28deg heat up and down hills, all the while ingesting lungfulls of carbon monoxide, lead oxide and carbon microparticles. It is virtue signalling at it's most expensive.
In fact the money could have been even better invested by promoting "work from home" and incentivising those employers who could to implement such schemes.

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Effortless on an e-bike... holding an umbrella

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Haha.. yeah - whilst wearing an N95 mask. If you've got an umbrella in one hand - how you gonna drink your Latte and respond to Twitter?

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Oulu is Finnish city near the artic circle and from the video link I put up you can see significant cycling mode-share can be achieved all year round - despite the weather conditions - if cycleways form a cohesive network, are separated and safe from larger motorised traffic and if they are well maintained on a daily/hourly basis.

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Thank you for the video. It seems that the real success for cycle ways is to take them away from the edges of the road and put them through parks if possible. This would be a win for both cyclists and motorists, but how to do it in an existing city? Have we provided for this in our newest suburban developments? With the way Auckland has grown in such a piecemeal fashion I doubt this has been done.

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Don't get me started on cycleways. I was on the motorway this morning and noticed some cyclists on the motorway, but right beside them was a newly constructed cycleway!

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I'm hearing you EdwardD. Apparently cyclists have the same right of way as other road users - even when they ride 3 abreast and restrict traffic. Clipped a drunk one the other day - broke his shoulder, had to pay him $1500 (chump change) - he don't ride on the road now.. learn't his lesson - don't weave around on the road in front of 2 tonne of 4WD

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You sound like a nasty piece of work, justifying breaking someone's shoulder (drunk or not). Take a look in the mirror and learn some humanity

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I'm with Hook on this one. Why spend taxpayer $'s on beautiful, wide, separated cycleways for the lycra brigade and they don't use them? The cyclists on the motorway were 3-abreast and holding up 100kph traffic.

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I think of cycle ways not as indulgences for middle aged Lycra enthusiasts, but as 4m wide uninterrupted corridors for individualised transport devices. My view is that park and ride, fixed-line mass transit etc is a monumental waste of money. The future is electric, individual, and probably automated.

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Gareth, I do not feel the politicians have the expertise or willingness to take effective action. They only play around the margins, nothing immediate or have profound impact.
Are you able to provide a list of MP’s showing their property interests including holdings through trusts or other legal vehicles? Start with the Labour ministers from the top down would be useful.

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Have a look here -
https://www.parliament.nz/media/6387/summary-report-2020-final.pdf
Looks like the next update won't be available until end of April this year

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Thanks Hook

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" I do not feel...politicians have the expertise..... to take effective action."
Nail, meet hammer.
Let's be honest. Becoming a politician isn't a calling of those who've made good elsewhere and now want to contribute to the building of the Nation. The last shot we had at that was Key - and look how he quickly buckled to The System. What real jobs have, say, Ardern and Robertson had other than progressing through student politics at Uni and graduating straight into the bureaucracy? How many wage packets have they had to fill regardless of how much has been taken into the till that week?
At best, it's a just job like any other; taught at Uni, and all from the same political and economic textbooks. At worst, it's a job for the boys and girls of business people who want to ensure access to people and information for the benefit of themselves and their relatives.
Changing the status quo isn't part of the curriculum.

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Agree with the general tenure of your argument - that idiot Menendez-March is a poster child for it. Can someone please explain how a Mexican refugee/activist, now a part of NZs legislature, is a good thing??
Seems the days of when politicians actually had "boots on ground" experience and wanted to change things for the better have long passed by. There are some - Verral, O'Connor, Kuriger, Mark, even Jones, but sadly they are in the minority. Now it's just another addition to the CV and a pathway to a directorship or in a lot of cases - just another well paid, unaccountable, all care no responsibility cruise - (Twyford and Clark fit in here, could probably add Brownlee and Muller).

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You want to add Brash, Shipley, Tremain, Key, Sabin. English? All have post-political descent from heaven.

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In any area outside the Wellington bureaucracy - Twyford is bound and gagged and told to keep away from sharp instruments for his own health. He's the reason we need more scaffolding on building sites because if he wants to inspect a roof, he'll probably fall off

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Menendez-March - how did he get citizenship when his primary job was a projectionist, after dropping out of university and becoming a projectionist/activist? Shows the immigration system is truly broken.

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FLP's are just extra play money for the banks. Just watch how they come up with a new architecture to convert it into dividends for their shareholders while peddling social good.

Like the good old saying, "Fool me once, shame on you; fool me twice, shame on me."

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We have to confront some tough decisions, and we will do that.

Tough decision on the supply side:
#rentcontrolnow (to address the fact that we are sorely lacking affordable housing, not housing per se).

Tough decision on the demand side:
Tax all equity as income (or at a flat rate of 30%, whichever is the higher) at the time of drawdown (to address the fact that owner-occupiers are at a significant disadvantage to existing asset holders/buy-to-let/landlords).

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#rentcontrolnow - depends on what you mean. There are controls already - bonds held in escrow, restrictions on frequency of rent rises, etc. However if you mean rents cannot be increased then with our current low inflation it would take years to solve the supply problem and if inflation returns to the high levels of the 1970's that is when the word "Rachmanism" entered the Oxford English Dictionary as a synonym for the exploitation and intimidation of tenants. Note intimidation of tenants would mainly be at the bottom end of the market - just the people you are trying to help.
I was a poor tenant living in London and New York when they had rent controls - it was not good for most but it was good for the minority who had won the lottery of a cheap place to live. There were even uninhabitable properties in the Bronx that the owners had abandoned.
It is the unintended consequences of a well meaning policy that have to be faced.

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Thanks Lapun for your personal comment.
"I was a poor tenant living in London and New York when they had rent controls - it was not good for most but it was good for the minority who had won the lottery of a cheap place to live. There were even uninhabitable properties in the Bronx that the owners had abandoned.
It is the unintended consequences of a well meaning policy that have to be faced."
Rent control by itself cannot work. Finding the political will to build affordable housing with abundance and with egalitarianism is what has worked overseas and in our past.

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I mean a universal rent maxima scheme (i.e., one that applies to all rental properties to avoid that 'lottery' problem). It would be based around the formula: (RV/1000) +/- x%. The 'x; variable would be set on an area basis, aligned to the tenancy.govt.nz market rent statistics. One would use the Stats NZ data for median household income for each area and determine the value of 'x' such that it would produce a weekly rent maximum of 30% of the lower quartile household income for the lower quartile properties (lower quartile determined by RVs).

The variable would be the same for all other properties as in most cases, the weekly rent maximum is not currently being exceeded in rent asking prices. The problem is in the mid to lower quartile of properties (i.e., the highest rent increases are for the lower property brackets).

Tenancy services already use a lower, median and upper scale - and so it would be really simple to amalgamate the data/information on rent maximum by area in line with their system;
https://www.tenancy.govt.nz/rent-bond-and-bills/market-rent/

They just have to rename it - from 'Market Rent' to 'Regulated Rent Maximum'.

Really very simple.

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It is indeed simple, but surely you knew by now the 'collective subconscious' of the ruling elite vested interest.

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So the govt gave the opportunity to lend to small business to banks because they knew the banks wouldn't do anything. It was never Grant Robertson's intention to spend any more than absolutely necessary on stabilising the financial situation after Covid hit.

Instead of building low income state housing in low income areas where it is needed the govt is going to indulge itself in a stuff up of the RMA and get completely lost in a tangle of competing interests and infighting.

Thereby distracting attention from it's own failure to build anything new for the future.

All for a balanced budget and to be seen to be 'prudent' financial managers.

What is the point of a balanced budget if your country's infrastructure is coming apart at the seams? Where is the future for NZ business if no money is spend on R & D? Where will the livable suburbs be if there are people living in their cars outside your house and there are anti social renters living on every street that can't be evicted who are making life a misery for everyone else because they feel they have no future?

It's useless being so woke while being so tight with the money. Problems need to be solved with practical solutions and money needs to be spent on practical solutions. Govt spent 1.6 billion re-organising the IRD. How much did they spend on new state housing?

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a better place? by mirage stats number, amplify the good to hear news, omitted the factual reality. NZ land of rainbow & fairy tale, is the correct description there.

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