Daffy
17th January 2006, 09:02 PM
http://www.stuff.co.nz/stuff/0,2106,3543169a13,00.html
Jaideco
18th January 2006, 12:40 AM
Sombre reading...
Perhaps we should have a single thread that holds all of these forecasts of doom and gloom in the NZ economy rather than having them all separately. Although I don't know which would scare people off more. ;-)
If you just cannot wait to start your new life then it probably doesn't matter very much in the long term but for those of us for whom money is a concern, or the move is only going to be short term then it important not to buy into NZ right before the economy falters or the currency weakens.
Ultimately it will always be a matter of speculation deciding when to move because noone knows exactly when a landing or recovery is going to happen.
What do you all think?
Perhaps we should have a single thread that holds all of these forecasts of doom and gloom in the NZ economy rather than having them all separately. Although I don't know which would scare people off more. ;-)
If you just cannot wait to start your new life then it probably doesn't matter very much in the long term but for those of us for whom money is a concern, or the move is only going to be short term then it important not to buy into NZ right before the economy falters or the currency weakens.
Ultimately it will always be a matter of speculation deciding when to move because noone knows exactly when a landing or recovery is going to happen.
What do you all think?
Hannah
18th January 2006, 01:40 PM
On a local level (New Plymouth) I read the other day that in the second half of 2004 house prices rose 44% and continued to rise (albeit not as rapidly) during 2005. Since we first travelled here 2 1/2 years ago (on holiday) house prices have trebled. Today's local paper has the headline "Business Gloom prompts call for easing in interest rates" with talk about impending economic meltdown and sharp recessions. Sound familiar? i remember reading the same stuff in England a year or two ago expecting my house price to dribble down to nothing but it doesn't seem to have happened (although houses are certainly selling more slowly as others on the forum have painfully experienced). It's difficult to know whether to delay a move of cash here or a house purchase as this feeling of gloom (but no change in the economy in terms of interest rates/house prices) could simply continue for years. (We planned to buy a second property to rent out over five years ago and kept putting it off due to media reports of an impending housing crash/recession...and it never happened. Where we lived the prices continued, and still continue, to rise).
foolsgold99
18th January 2006, 02:04 PM
It's not all that sombre if you go through the details, (economics is a hobby of mine,sad I know)
Capacity utilisation was still historically high at 91.5 per cent, slightly down on the 91.9 per cent on the previous survey.
This one of the highest figures in the world, the NZ economy is max'd out and can't grow anymore because there simply aren't people to fill the jobs. This is leading to an increase in the living standards of workers, as they have to offer increased benfits / wages to hire/retain skilled staff.
There is politics behind this report, the author NZIER have a agenda for lower interest rates, they are trying to beat the reserve bank into dropping rates. The reserve bank on the other hand is trying to convince people that it's actually going to raise rates (it isn't). It's bluff and counter bluff. The markets have priced a 125pt fall in interest rates over the next year or so.
Barring wild stupidity with the goverment and the reserve bank NZ can't have a recession alone, it's tied closey into the world economy. A decline in retails sales isn't a bad thing, as they are mostly imports anyway, this should lead to debt reduction and a more balanced saving profile for NZ, NZ has one of the lowest saving rates in the world.
WestPac does very good weekly reports, have a look here, page 6 has some interesting info
http://www.westpac.co.nz/olcontent/olcontent.nsf/content/FM_Weekly_20060116/$FILE/NZWC1601.pdf?Open
Worst case it's suggesting GDP growth of 1.5% 2007, it's down from 3.7 of last year, but still reasonably healthly. It is in no way a recession. A recession is negative GDP figure for 2 consequtive quarters. No prospect of this.
Also from personal exprience, business confidence in auckland seems high, we are very busy and adding staff, our customers are doing plenty of capital expenditure.
Capacity utilisation was still historically high at 91.5 per cent, slightly down on the 91.9 per cent on the previous survey.
This one of the highest figures in the world, the NZ economy is max'd out and can't grow anymore because there simply aren't people to fill the jobs. This is leading to an increase in the living standards of workers, as they have to offer increased benfits / wages to hire/retain skilled staff.
There is politics behind this report, the author NZIER have a agenda for lower interest rates, they are trying to beat the reserve bank into dropping rates. The reserve bank on the other hand is trying to convince people that it's actually going to raise rates (it isn't). It's bluff and counter bluff. The markets have priced a 125pt fall in interest rates over the next year or so.
Barring wild stupidity with the goverment and the reserve bank NZ can't have a recession alone, it's tied closey into the world economy. A decline in retails sales isn't a bad thing, as they are mostly imports anyway, this should lead to debt reduction and a more balanced saving profile for NZ, NZ has one of the lowest saving rates in the world.
WestPac does very good weekly reports, have a look here, page 6 has some interesting info
http://www.westpac.co.nz/olcontent/olcontent.nsf/content/FM_Weekly_20060116/$FILE/NZWC1601.pdf?Open
Worst case it's suggesting GDP growth of 1.5% 2007, it's down from 3.7 of last year, but still reasonably healthly. It is in no way a recession. A recession is negative GDP figure for 2 consequtive quarters. No prospect of this.
Also from personal exprience, business confidence in auckland seems high, we are very busy and adding staff, our customers are doing plenty of capital expenditure.
toesonthenose
18th January 2006, 06:14 PM
Just wait until the USA and the next coalition of the willing (looks like Germany this time) attack Iran later this year, the resulting $100 per barrel oil will certainly be a trigger for a potential worldwide recession.
foolsgold99
18th January 2006, 07:21 PM
Just wait until the USA and the next coalition of the willing (looks like Germany this time) attack Iran later this year, the resulting $100 per barrel oil will certainly be a trigger for a potential worldwide recession.
Not going to happen, the americans simply don't have the military capacity to do an invasion of iran right now. They have 140,000 men tied down in the occupation of iraq, 70% of Iraqi are shias (like in iran). right now they are largely peaceful, start a war with iran, and they revolt. You'd need another 400,000 men in Iraq. The revolt there is almost all Sunni.
Plus Iran has 3 times the population and almost twice the land area of iraq, you'd need a occupation force in excess of a milion men to hold it. Unlike Iraq, their is only one ethnic group in Iran, no playing off Kurd vs Sunni vs Shia there. Everyone will hate and fight the americans.
Unless you want to conscript every american man between 18 and 28 and take loses of 1000 men a month it simply can't be done.
What we do about iran, well that's anothe question....................
Not going to happen, the americans simply don't have the military capacity to do an invasion of iran right now. They have 140,000 men tied down in the occupation of iraq, 70% of Iraqi are shias (like in iran). right now they are largely peaceful, start a war with iran, and they revolt. You'd need another 400,000 men in Iraq. The revolt there is almost all Sunni.
Plus Iran has 3 times the population and almost twice the land area of iraq, you'd need a occupation force in excess of a milion men to hold it. Unlike Iraq, their is only one ethnic group in Iran, no playing off Kurd vs Sunni vs Shia there. Everyone will hate and fight the americans.
Unless you want to conscript every american man between 18 and 28 and take loses of 1000 men a month it simply can't be done.
What we do about iran, well that's anothe question....................
Moorf
18th January 2006, 07:56 PM
Just wait until the USA and the next coalition of the willing (looks like Germany this time) attack Iran later this year,
That's if Israel doesn't get there first......
That's if Israel doesn't get there first......
Jaideco
18th January 2006, 09:10 PM
I cannot decide whether I wish that I were more of an economist, or if that would just drive me insane through double guessing what is going to happen.
When Goldman Sachs suggested that the kiwidollar was 20% overvalued and would start to correct by the end of the year I thought that the best thing to do would be to keep as little in the NZ economy as possible. If there is an argument for the exact opposite view however I really don't know what to do with my surplus NZD.
Thank god I am a scientist, at least some things can be absolute certainties.
When Goldman Sachs suggested that the kiwidollar was 20% overvalued and would start to correct by the end of the year I thought that the best thing to do would be to keep as little in the NZ economy as possible. If there is an argument for the exact opposite view however I really don't know what to do with my surplus NZD.
Thank god I am a scientist, at least some things can be absolute certainties.
toesonthenose
18th January 2006, 09:14 PM
Foolsgold,
You are right, though I am talking bombing, not invasion. America would have to have an idiot for President to actually start something with another middle eastern nation......uh oh!
You are right, though I am talking bombing, not invasion. America would have to have an idiot for President to actually start something with another middle eastern nation......uh oh!
Al_S
19th January 2006, 02:24 AM
http://hosted.ap.org/dynamic/stories/W/WALL_STREET?SITE=ORPEN&TEMPLATE=DEFAULT&SECTION=HOME
StevieD
19th January 2006, 07:17 AM
Chimpleon is one scary guy! Anything is possible with that dude in charge - quite frightening.
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