And they’re right. Despite the Govt’s fiscal crisis talk, mostly NZ banks, NZ fund managers and central banks bid a record-high $22.7b for $6b of new Govt bonds maturing in 2036 costing 4%/year
Barnard, I will try to gently persuade my Dad to have a listen to this. I don't think a lot of Kiwis even know about the bond auctions, I didn't until I started follwing you. It's soooo counter intuitive to what we grew up learning as Kiwis.
The government has absolutely no need to sell bonds. It is interest rate floor maintenance (forces banks to raise since banks operate on a spread) and it is nothing else but _basic income but *only for people who already have money* and in proportion to how much money they already have._
We don't even need to borrow at all. It's a policy choice. One could argue you're not even spending 3 billion when you write on assets like ports and ferries with 30 and 100 year lifespans.
The question I have is why haven't the other journalists that cover the political-economy in this country asked some more searching questions of our politicians who make claims of one economic crisis after another?
I was just about to say the same thing, then this morning Ingrid Hipkiss was boasting that she was no good at maths. Or maybe more fairly normalising that she was numerically illiterate .
Because if they find a neoclassical economists to help them, that economist *will* tell them the same thing about austerity and tax cuts. Regarding explaining bonds, the general public who read the news only "understand" that "debt is bad". Explaining why an ability to borrow millions is great for NZ goes against the grain of household finances.
Didn’t Nicola Willis, the Minister of Finance, say something like this but reading about demand for bonds this Coalition Government is creating a banana republic by not investing in essential services notwithstanding that it has the financial capacity to do so.
True but the NZ Psyche doesn't totally have a anaphylactic reaction to debt; house buying and then leveraging to buy multiple properties come to mind, or property maintenance and upgrades (think new kitchens, painting, roofing etc...). May be infrastructure deficits should be referenced in terms of property maintenance and the need to keep the property up to scratch.
I think you're supporting the point. Kiwis and most people dont view a mortgage as *debt* that's "investment". People don't see a mortgage as a huge debt because the brainwashing tells you a mortgage is *good*. Good and responsible. 'You're being very responsible and building for your future when you "buy a house"'. Again home improvements...no..not debt, "investing" in your property.
Release please Bernard. You need to call “bullshit” on the trope that “governments should budget like households” and stop the “Bullshit“about NZ being a poor country. It is not. It just has gross inequality of Wealth caused by Rich property owners and Right wing politicos peddling 20th century economic thinking. Seems those fund managers might know something. Can the “three headed Taniwha” learn? Doubt it.
Great explanation in everyday language anyone could relate to. Indeed the present political narrative from our elected leaders is like giving as economic koolaid to drink with a side serving of b...s..t dip.
I support opening this up so others can enjoy your commentary and learn
Courage to suggest a Land Tax .. and I might go back to supporting Labour . Otherwise I have lost faith and can't find anything to be excited about other than TOP / TPM ..
I just watched it. It was indeed very interesting. He is saying the right things, but I do worry that this will be yet another debate that will get highjacked by the right. They will say things like...eg; "Labour are coming for the money you worked hard for" or "Kiwis just want to get what they earned" ie: reframing the debate from much needed revenue that will help the country(all kiwis), to what Kiwis(individuals) will lose. "Me vs we".
Soooo many people have a prejudice against government spending & helping those who are less fortunate, that those hollow arguments will work for just enough people that the Nats might get re-elected. The "me" society will win out over the "we" society.
It is beyond me why anyone should listen to Max Bradford's reckons on electricity given the price-gouging, short-sighted electricity market set-up he pushed through Parliament in the 1990s is giving so much grief right now.
Apart from a revolution, what can a citizen do (between elections) to demonstrate to a government that blatantly and deliberately uses deceit to support its own flawed agenda, that we are not buying it! Ive never felt more powerless and despairing.
join a political party which most closely represents your views if you haven't already. In my experience it is empowering, there is solidarity in knowing you are not alone, and I can work more smartly when working with others. It gave me confidence to challenge my local Nat MP yesterday in a face to face conversation - we had a respectful discussion and I feel I was better equipped for that because I already had a better context from my involvement with local comrades
I would like to echo those calling for you to publish this one more widely, Bernard.
Also - we should all be very worried about WHY this mendacious austerity narrative has been foisted on the country. It has not been pushed out as an end in itself; my guess is that it is the precursor to more privatisation (hospitals? schools?) and "opportunities" for wealthy donors.
Many thanks Bernard for your very informative blogs, todays is tops. One of the issues that bothers me and many others is our balance of trade, for many years we have struggled to get surpluses which indicates we are living beyond our means. It would be very interesting to get some perspective,an overview on the importance of this issue. What does NZ need to do and is it an issue we should all be concerned about?
I would have thought that our capital expenditure should be focused on improving kiwis lives,well being, education, skills and infrastructure so we have the tools to do better. Successive governments turn the fiscal taps off and on at whims, creating instability, austerity and fuelling the housing market when on.
Our current government is fast learning that their low tax regime wont cut the mustard so are having to bring in various charges and or increase charges to assist with revenue shortfalls, Mr Levy’s Health cuts of 1.4 billion is stupidly at its worst. And like their dealing with our emissions will only add cost for future generations.
Our Agri exports are a big question, especially with our methane emissions, this is our elephant in the room, that has to addressed, hoping that science will come to the rescue is like importing liquified gas, heads in sand exposes your vitals!
Barnard, I will try to gently persuade my Dad to have a listen to this. I don't think a lot of Kiwis even know about the bond auctions, I didn't until I started follwing you. It's soooo counter intuitive to what we grew up learning as Kiwis.
The government has absolutely no need to sell bonds. It is interest rate floor maintenance (forces banks to raise since banks operate on a spread) and it is nothing else but _basic income but *only for people who already have money* and in proportion to how much money they already have._
In one bond auction they are forced to borrow more than enough to pay for the iRex ferries. Talk about cutting off your nose to spite your face
Yet, if South Korea made comment about these contradictory actions I suspect our present leaders would take the wrong lesson.
With the head of treasury in play, it is easy to imagine the new chief will be expected to play along with the austerity narrative.
We don't even need to borrow at all. It's a policy choice. One could argue you're not even spending 3 billion when you write on assets like ports and ferries with 30 and 100 year lifespans.
The question I have is why haven't the other journalists that cover the political-economy in this country asked some more searching questions of our politicians who make claims of one economic crisis after another?
I was just about to say the same thing, then this morning Ingrid Hipkiss was boasting that she was no good at maths. Or maybe more fairly normalising that she was numerically illiterate .
Because if they find a neoclassical economists to help them, that economist *will* tell them the same thing about austerity and tax cuts. Regarding explaining bonds, the general public who read the news only "understand" that "debt is bad". Explaining why an ability to borrow millions is great for NZ goes against the grain of household finances.
“Government budgeting just like household” is one of many Big Lies that Truth will neutralise
Gary Dyall
Didn’t Nicola Willis, the Minister of Finance, say something like this but reading about demand for bonds this Coalition Government is creating a banana republic by not investing in essential services notwithstanding that it has the financial capacity to do so.
True but the NZ Psyche doesn't totally have a anaphylactic reaction to debt; house buying and then leveraging to buy multiple properties come to mind, or property maintenance and upgrades (think new kitchens, painting, roofing etc...). May be infrastructure deficits should be referenced in terms of property maintenance and the need to keep the property up to scratch.
I think you're supporting the point. Kiwis and most people dont view a mortgage as *debt* that's "investment". People don't see a mortgage as a huge debt because the brainwashing tells you a mortgage is *good*. Good and responsible. 'You're being very responsible and building for your future when you "buy a house"'. Again home improvements...no..not debt, "investing" in your property.
My theory is that not many(if any) other journalists have that specialty knowledge. Some do but work elsewhere.
Why is this not headline news!
Perhaps Nathan Rarere RNZ sports expert might understand what Ingrid does not about numbers. He is a wizard with multiple sports info.
Release please Bernard. You need to call “bullshit” on the trope that “governments should budget like households” and stop the “Bullshit“about NZ being a poor country. It is not. It just has gross inequality of Wealth caused by Rich property owners and Right wing politicos peddling 20th century economic thinking. Seems those fund managers might know something. Can the “three headed Taniwha” learn? Doubt it.
Patrick Medlicott
Indeed, release.
such an important message to get out there, thank you Bernard
Great explanation in everyday language anyone could relate to. Indeed the present political narrative from our elected leaders is like giving as economic koolaid to drink with a side serving of b...s..t dip.
I support opening this up so others can enjoy your commentary and learn
* giving us
Listen to Tova’s interview yesterday with Chris Hipkins, I think you will feel encouraged https://podcasts.apple.com/nz/podcast/tova/id1702420531?i=1000668433073
Sounds like Hipkins has more time to read his Kākā subscription now that he’s not PM 😅
Still, I think I’ll believe it when I see it. We’ve been round this roundabout before.
I genuinely hope Uncle Chippy is doing just that. Now he just has to grow some courage & work on his communication skills.
Courage to suggest a Land Tax .. and I might go back to supporting Labour . Otherwise I have lost faith and can't find anything to be excited about other than TOP / TPM ..
Chris Hipkins had a quite interesting interview on QandA this morning (Sun 08 Sept). worth watching imo.
I just watched it. It was indeed very interesting. He is saying the right things, but I do worry that this will be yet another debate that will get highjacked by the right. They will say things like...eg; "Labour are coming for the money you worked hard for" or "Kiwis just want to get what they earned" ie: reframing the debate from much needed revenue that will help the country(all kiwis), to what Kiwis(individuals) will lose. "Me vs we".
Soooo many people have a prejudice against government spending & helping those who are less fortunate, that those hollow arguments will work for just enough people that the Nats might get re-elected. The "me" society will win out over the "we" society.
Get this released with ❤️'s folks...or the mainstream media will say it didn't happen!
It is beyond me why anyone should listen to Max Bradford's reckons on electricity given the price-gouging, short-sighted electricity market set-up he pushed through Parliament in the 1990s is giving so much grief right now.
Apart from a revolution, what can a citizen do (between elections) to demonstrate to a government that blatantly and deliberately uses deceit to support its own flawed agenda, that we are not buying it! Ive never felt more powerless and despairing.
join a political party which most closely represents your views if you haven't already. In my experience it is empowering, there is solidarity in knowing you are not alone, and I can work more smartly when working with others. It gave me confidence to challenge my local Nat MP yesterday in a face to face conversation - we had a respectful discussion and I feel I was better equipped for that because I already had a better context from my involvement with local comrades
I would like to echo those calling for you to publish this one more widely, Bernard.
Also - we should all be very worried about WHY this mendacious austerity narrative has been foisted on the country. It has not been pushed out as an end in itself; my guess is that it is the precursor to more privatisation (hospitals? schools?) and "opportunities" for wealthy donors.
Sometimes the conspiracy is very very real and the conspirators hide in plain sight.
Nice views from the Treasury building
Many thanks Bernard for your very informative blogs, todays is tops. One of the issues that bothers me and many others is our balance of trade, for many years we have struggled to get surpluses which indicates we are living beyond our means. It would be very interesting to get some perspective,an overview on the importance of this issue. What does NZ need to do and is it an issue we should all be concerned about?
I would have thought that our capital expenditure should be focused on improving kiwis lives,well being, education, skills and infrastructure so we have the tools to do better. Successive governments turn the fiscal taps off and on at whims, creating instability, austerity and fuelling the housing market when on.
Our current government is fast learning that their low tax regime wont cut the mustard so are having to bring in various charges and or increase charges to assist with revenue shortfalls, Mr Levy’s Health cuts of 1.4 billion is stupidly at its worst. And like their dealing with our emissions will only add cost for future generations.
Our Agri exports are a big question, especially with our methane emissions, this is our elephant in the room, that has to addressed, hoping that science will come to the rescue is like importing liquified gas, heads in sand exposes your vitals!
Thank you Bernard, please release.