Tag Archives: Reserve Bank

‘Low inflation’ v House price inflation

deflation-the-japan-times[Japan Times]

### NZ Herald Online 12:00 PM Tuesday Oct 18, 2016
Economy
No inflation? So why doesn’t it feel like it?
By Liam Dann – NZ Herald business editor at large
If yesterday’s Consumer Price Index, showing just 0.2 per cent inflation in the past year didn’t match your experience of rising prices, fear not, there is a new set of data that could offer a more realistic reflection of Kiwi household costs. The CPI for the year to September came in slightly higher than the predictions of most economists but still takes the economy dangerously close to deflation – a phenomenon where falling price expectations start to suppress economic growth. […] Meanwhile, the Household Living-costs Price Index (HLPI) gets much less attention from economists but has been designed over the past three years to reflect the fact that real world inflation varies greatly depending on your household wealth and expenditure, Matt Haigh [Statistics NZ consumer prices manager] said. It offers data for specific sub-sections of New Zealand such as beneficiaries, Maori, superannuitants, five different income groupings and five expenditure groups. In doing so it captures inequalities of price inflation which the CPI does not. So for example rent, which was up 3.4 per cent for the year in Auckland, is factored into the CPI with a weighting of 10 per cent. But, said Haigh, in reality for many renters it is likely to be more like 40 per cent of total expenditure. That weighting is more accurately reflected in the HLPI – especially in the lower income groups.
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█ On November 8 Statistics New Zealand will provide its first live quarterly update for the HLPI data, with details for the year to September, and it should provide more insight for those looking at inflation from a social or political perspective. Backdated HLPI data for the year to September 2015 is already available on the Statistics NZ website.

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deflationary-cycle-web-world-cycles-instituteDeflationary cycle web [World Cycles Institute]

For many New Zealanders the low inflation story doesn’t stack up with daily experience. That’s because one of the largest costs we face in life, house price inflation, continues to rise more than anything else.

### NZ Herald Online 6:41 AM Tuesday Oct 18, 2016
Liam Dann: Inflation now at dangerously low level
OPINION Inflation data due today is tipped to show the economy skating dangerously close to deflation. Economists’ forecasts for the September quarter Consumer Price Index have inflation falling in the past three months and now only just above zero on an annualised basis. Most economists are picking it will come in at 0.1 or 0.2 per cent for the year to September 30 – down from 0.4 per cent in the year to June 30. The fall is expected to be driven by lower transport costs as oil slumped again in the quarter while housing costs are likely to be the largest rising category. Persistently low inflation is considered one of just a few dark spots in another otherwise rosy economic picture, although it is consistent with a number of other economies right now.
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Posted by Elizabeth Kerr

This post is offered in the public interest.

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Filed under Business, Democracy, Economics, Finance, Media, Name, New Zealand, People, Politics, Public interest

NZ Banks creaming it overnight ?

Received from Gurglars
23/05/2016 4:13 am (GMT+12:00)

Subject: Banks Theft

I have sent this letter to my bank.
This type of arrogant theft by banks must be exposed and stopped! The stock exchange has recently shortened settlement days from 3 to 2 for this very reason! In some cases over the weekend banks can make 50% on overnight money markets, so they use YOUR and MY money to make huge profits whilst charging us interest on outstanding debts that could be amortised.

A sum of $***** was deposited to my account Saturday. At the latest it should be in my account Monday morning! Given the nature of internet transactions, the keeping of MY money for two days is in fact an act of theft. The monies have left the sender’s account and not been lodged in my account and therefore the bank has claimed some ownership of the money for two days when the bank is trading. This “theft” which could be presumed legal when banks had to have time to clear funds is no longer a “legal” action!

[ends]

My quick reply:

Excellent point. Yes they reap at our cost, bare-faced. Some banks over others have difficulty moving to processing 24/7…. more ‘instantaneously’. From discussion with colleagues, it appears ANZ has recently moved to “next morning” (including paying in on Saturdays) for deposits made after 10pm on Friday nights —which previously had a dogged (clip-ticket) wait until “after 10pm Monday” for transaction. Some shift has occurred(?).
Consumers need to stack on the pressure.
The Banking Ombudsman needs to investigate – the public should send letters their way.

New Zealand’s Banking Ombudsman Scheme
The Banking Ombudsman Scheme investigates and resolves disputes between customers and their banks. We are independent of scheme participants, customers, and government. Our service is free of charge and easy to use.
https://bankomb.org.nz/

### radionz.co.nz Tue 24 May 2016 7:00 am today
Morning Report with Guyon Espiner & Susie Ferguson
Reserve Bank keeping an eye on digital disruption on banking
The Reserve Bank is monitoring the impact of digital disruption on the banking sector, as a rapidly increasing number of unregulated players have the potential to undermine the existing financial system.
Audio | Download: Ogg  MP3 (2′07″)

Posted by Elizabeth Kerr

Bank toon-3228 [glasbergen.com] 1[glasbergen.com]

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Filed under Business, Democracy, Economics, Finance, Media, New Zealand, Ombudsman, People, Public interest

Warning! NZ disposable income down

Link received Mon, 6 Apr 2015 at 1:00 p.m.

█ Message: Wouldn’t read this in local media !!!

### marketoracle.co.uk Apr 05, 2015 – 01:28 PM GMT
Economics / Asian Economies
New Zealand Economy – There’s Trouble Brewing In Middle Earth
By Raul I Meijer
For the second time in three years, I’m fortunate enough to spend some time in New Zealand (or Aotearoa). In 2012, it was all mostly a pretty crazy touring schedule, but this time is a bit quieter. Still get to meet tons of people though, in between the relentless Automatic Earth publishing schedule. And of course people want to ask, once they know what I do, how I think their country is doing.
My answer is I think New Zealand is much better off than most other countries, but not because they’re presently richer (disappointing for many). They’re better off because of the potential here. Which isn’t being used much at all right now. In fact, New Zealand does about everything wrong on a political and macro-economic scale. […] I’ve been going through some numbers today, and lots of articles, and I think I have an idea what’s going on. Thank you to my new best friend Grant here in Northland (is it Kerikeri or Kaikohe?) for providing much of the reading material and the initial spark.
To begin with, official government data. We love those, don’t we, wherever we turn our inquisitive heads. Because no government would ever not be fully open and truthful.

This is from Stuff.co.nz, March 19 2015:
New Zealand GDP grew 3.3% last year

New Zealand’s economy grew 3.3% last year, the fastest since 2007 before the global financial crisis, Statistics NZ said. Most forecasts expect the economy to keep growing this year and next, although slightly more slowly than in the past year. For the three months ended December 31, GDP grew 0.8%, in line with Reserve Bank and other forecasts. That was led by shop sales and accommodation. That sounds great compared to most other nations. But then we find out where the alleged growth has come from (I say alleged because other data cast a serious doubt on the ‘official’ numbers) […] while the economy ostensibly grew by 3.3%, disposable income was down. That’s what you call a warning sign.

….Meijer’s commentary continues in reference to recent New Zealand news stories:

Stuff: Dairy Slump Hits New Zealand Exports To China
Radio NZ: Export Drop Rattles Companies
NZ Herald: World Dairy Prices Slide 10.8% On Supply Concerns
Radio NZ: World ‘Awash With Milk’
NZ Herald: Stress Too Much For Farmers
NZ Herald: Hot Properties: Auckland Valuations Out Of Date Within Months

He ends by citing NZ Herald: New Zealand’s Economic Winds Of Change:

Chaos theory calls it the butterfly effect. It’s the idea that a butterfly flapping its wings in the Amazon could cause a tornado in Texas. The New Zealand economy has plenty of its own butterflies changing the weather for GDP growth, jobs, interest rates, inflation and house prices. [..] One of the flappiest at the moment is the global iron ore price. It’s barely noticed here but it’s an indicator of growing trouble inside our largest trading partner, China, and it is knocking our second-largest partner, Australia, for six. It fell to a 10-year low of almost US$50 a tonne this week and is down from a peak of more than US$170 a tonne in early 2011.
[…] President Xi has reinforced the contrasting effects of the changes in China on Australia and New Zealand by encouraging consumers and investors to spend more of China’s big trade surpluses overseas. Tourism from China was up 40% in the first two months of this year from a year ago, and there remains plenty of demand from investors in China for New Zealand assets.
The dark side of this tornado in New Zealand after the flapping of the butterfly’s wings in China was felt in Nelson this week. The region’s biggest logging trucking firm, Waimea Contract Carriers, was put into voluntary administration owing $14m, partly because of a slump in log exports to China in the past six months.
That’s because New Zealand’s logs are now mostly shipped to China to be timber boxing for the concrete being poured in its new “ghost” cities. The Chinese iron ore butterfly has flapped and now we’re seeing Gold Coast winter breaks become cheaper and logging contracts rarer.

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Website: http://theautomaticearth.com (provides unique analysis of economics, finance, politics and social dynamics in the context of Complexity Theory)

Posted by Elizabeth Kerr

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Clarke and Dawe: ‘We’re getting a lot of changes coming through….’

ClarkeAndDawe Published on Aug 6, 2014

Clarke and Dawe – An Exciting New Interpretation of The Text.
“An Important Government Functionary. One of many.” Originally aired on ABC TV: 07/08/2014

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ClarkeAndDawe Published on Aug 13, 2014

Clarke and Dawe – The Exceptions that Prove the Rules
“Mr Desmond Gruntled, Financial Projectionist” Originally aired on ABC TV: 14/08/2014

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ClarkeAndDawe Published on Aug 20, 2014

Clarke and Dawe – Who said that?
“Mr Tim Astraya, Asparagus farmer” Originally aired on ABC TV: 21/08/2014

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ClarkeAndDawe Published on Aug 27, 2014

Clarke and Dawe – Some Slight Difficulties in the Workplace
“An Extremely Senior Australian Treasury Official” Originally aired on ABC TV: 28/08/2014

http://www.mrjohnclarke.com
http://www.twitter.com/mrjohnclarke
http://www.facebook.com/ClarkeAndDawe

Posted by Elizabeth Kerr

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He may know a thing or two about Valleys…

and that’s roof valleys (in his previous life as television building presenter), because seemingly Cr Cull’s economic analysis is excessively pessimistic. His assessment of the peaks and valleys of economic modelling seem somewhat less accurate than his building acumen.

Writing in his opinion piece in the ODT today (4.12.08), Cr Cull was unsurprisingly pushing the ‘current economic conditions’ line as the reason for halting the stadium development. Making reference to unnamed “Eminent economists”, Cr Cull claims that we are in the “worst global recession in a century, predicting a longer and deeper slump than first anticipated.”

Further he claimed “business outlook for the medium term is negative” and that “Unfortunately, much worse is on its way.” Very gloomy indeed. However it is a shame that those unnamed economists seem to be at odds with both the very conservative economic think tank the New Zealand Institute of Economic Research’s (NZIER) own forecast released 1 Dec, and that of the Governor of the Reserve Bank, Dr Bollard. Continue reading

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Filed under Economics, Hot air, Stadiums