Ask Me Anything about the week that was
Paid subscribers are welcome to throw me questions for an hour from midday on the events of the week around housing, poverty and climate change in Aotearoa-NZ's political economy
It’s that time of the week again where anyone who is a paid subscriber and commenter can Ask Me Anything about the events of the week that was, including:
The second week of anti-mandate and anti-vaxx protestors surrounding Parliament with vehicle blockades, tents and portaloos;
Aotearoa-NZ’s move into phase II of our omicron response as case numbers surge over 1,000 a day and businesses scramble to be designated as essential to get their hands on RATs;
REINZ figures showing house prices have fallen 2.7% from the peak in Nov and moves by the Government to reopen the credit taps turned down (accidentally) by the CCCFA’s more prescriptive rules for mortgage approvers; and,
Another rate hike expected next week from the Reserve Bank.
I’ll do my best to answer in the comment thread below for the next hour.
Want to join The Kākā community and support my explanatory, accountability and solutions journalism on housing unaffordability, climate change inaction and child poverty reduction?
What is your read on the poll Stuff is reporting on today that somewhere in the vicinity of 30% of kiwis support the protest? I can't bring myself to believe it, and I'm wondering if there is some obvious fact I'm overlooking.
Good afternoon Bernard Hickey,
I am a subscriber to The Kaka and enjoy your podcasts.
I am a Land Surveyor and in the heart of the development stream of new subdivision through to new builds. Your comments regarding NZ property and its place in NZ society fascinate me.
Overview. In simplistic terms an earlier mortgage of $200,000 @ 10% has the same serviceability as a $ 800,000 @ 2.5%. This, to date, has in my assessment fueled much of the unsustainability/asset bubble in property.
So, my question. Given the dominance of the US economy on the global economy, of which NZ is just 0.2% by way of stock market valuation, did NZ have a choice about lowering its OCR? If NZ had stayed at an OCR of say 6% would 1) The NZ/USA exchange rate been madly high thus making NZ exports less profitable or indeed struggle for international competitiveness and 2) would masses of overseas money have flooded in to NZ (as a relatively stable western democracy, earthquakes and tsunamis aside) thereby having a destabilising effect on NZ?
Summary. I ponder if, in terms of credit and interest rates, relatively small policy initiatives inside NZ aside, if we in NZ are swept along by international well more specifically USA financial policy? That is they make the decisions and we follow! In essence the credit boom started with Reagan's administration loosening credit control which finished with the leveraged implosion of the GFC (which incidentally I thought would have kicked inflation off however I guess largely manifested itself in asset inflation). Cricky, plenty to ponder!
Cheers Noel Armstrong