Dawn chorus Wednesday Oct 28

Green-Labour deal due Friday; RBNZ's Orr and Hawkesby may speak on housing boom; Covid-19 waves crash through European and US economies

TLDR version: A Green-Labour deal of some sorts is likely to be done by Friday, but don’t expect the Greens to get much. Global stocks are sliding as Covid-19 second and third waves crash through the world’s largest economies. I’ll be watching out today for more from the Reserve Bank on what it might do about its massive and necessary stimulus pumping up house prices. Adrian Orr and Christian Hawkesby deliver speeches today. This CoreLogic chart tells the story.

Labour-Green ‘consultation’ deal due on Friday

Green Co-Leaders James Shaw and Marama Davidson emerged from talks with Labour’s team last night at Bowen House in Wellington to say they expected the talks to be completed on Friday, with or without a ‘consultation’ deal.

The deal would then be put to Green Party delegates in a conference call that could last hours.

“It’s a straight up-and-down vote, so we would either join the Government, or we would not join the Government.” James Shaw

Labour doesn’t need a Green coalition or confidence and supply agreement to govern alone, which means the Greens don’t have any leverage to extract concessions. The decision will depend on which minor ministries or roles outside of cabinet or particular consultation rights they might secure. And whether they are seen as worth muzzling the Greens ability to criticise the Government and separate the Green ‘brand’ enough from Labour to keep it distinct in the eyes of voters and able to campaign for its policies.

It wouldn’t surprise me to see the Greens secure some form of consultation with the Government and agreement to work together on some policies such as climate change and conservation, but not give up the right to be sharply critical on issues such as transport, welfare reform, housing and inequality.

Other bits and bobs of news here and there

‘He’s our boy?’ - National said it would support Donald Trump’s nomination of New Zealander Chris Liddell for the role of Secretary General of the OECD. Liddell has been a senior official in Trump’s White House and has been one of the rare staffers who has lasted all of Trump’s first (and only?) term, although there still remains a few weeks before the election.

The Greens oppose the appointment. Labour is playing its cards close to its chest before the formation of the Government here and the US election result next week. (Stuff. Newsroom.)

Market fears back: US and European stocks extended their losses from Monday overnight as second and third waves of Covid-19 crash through the European and US economies, and Congressional leaders in America appear unlikely now to come up with a much-needed second stimulus plan before next week’s US elections. (Reuters)

Links worth your time

This New York Times deep dive into Peter Thiel’s Palantir, which does plenty of work for our own security services, is a good outline and includes an interview with its CEO Alex Karp.

Catherine Harris from Stuff takes a closer look at the philanthropists involved in community housing in New Zealand.

Coming up…

Today - Reserve Bank Governor Adrian Orr is scheduled to give a virtual key note address at the Pacific Climate Conference being jointly organised by the Victoria University of Wellington, the National University of Samoa, the Government of Samoa, and the Secretariat of the Pacific Regional Environment Programme. The speech notes will be available on the Reserve Bank website at 11am. 

Today - Reserve Bank Assistant Governor for Economics Christian Hawkesby is scheduled to speak at the Property Council’s Retail Conference in Auckland at 9.20 am. His presentation is already available here at the Reserve Bank website.

Today - Australian inflation figures are due this afternoon. They are being closely watched for signs of low inflation, given the Reserve Bank of Australia is expected to ease monetary policy at its next monetary policy setting meeting next Tuesday.

Thursday – ANZ Group annual results

Friday - Electoral Commission to release preliminary results of referendums

Friday - Discussions between Labour and Greens due to be completed. If some form of agreement is proposed, 70% of Green members would need to approve it in group teleconference.

Friday – The Reserve Bank scheduled to release overall bank lending figures for September at 3pm.

Friday – Port of Tauranga and Tourism Holding AGMs due.

November 3 - Reserve Bank of Australia expected to ease monetary policy

November 3 - US Presidential elections (Nov 4 NZ Time)

November 6 - Official final NZ election and referendum results announced after counting of special votes. 

November 11 - Reserve Bank quarterly Monetary Policy Statement (MPS) and news conference at 2pm

November 21 - National Party AGM due to vote on re-election of President Peter Goodfellow.

November 25 - Reserve Bank six monthly Financial Stability Report (FSR) scheduled for release

Ngā Mihi

Bernard