Markets celebrate after Fed hikes 75bps as expected and Powell eyes a slower tightening; Traders are betting on rate cuts next year as mild recessions in late 2022 do the Fed's inflation-fighting work
Stats NZ nos confirmed what we all know. We can’t afford 1m boomers getting NZ super from 65 to 90 (without a doubling in the working age popn through mega immigration or a baby boom) as well as the associated demand in health care costs. Super age needs to rise to 70, within a decade, and it needs stop being a universal benefit. There is no justification for taxing cleaners in order give the money to Winston Peters etc.
I tend to agree with NZ Super being a universal benefit at age 65 not later - but ALSO means tested. It doesn't make sense that millionaires get the same amount as me (a non millionaire and a renter to boot) I was so worn out and weary of life before 65 happened and I kept working until redundancy at 67 - if I had to hold out to 70 I would be dead by now.
If you give people enough time they can plan accordingly and can choose to retire at a time of their choosing. Hopefully spend their final years in roles where they pass on their valuable experience to the next generations.
Shit happens Julian. Best laid plans of mice and men often go wrong (Burns) In other words you can build a secure world (mouse nest) but it still goes wrong (the farmers plough) so some things are beyond your control. But yes, I am spending my final years passing on my wisdom which is means test superannuation.
NZ superannuation should be income tested. A person with a gross taxable income twice superannuation should not be able to still get NZ superannuation.
Hi Bernard, The stats data is interesting - especially the growing over 65+. Are you able to do some sessions on long term strategies and the pros and cons of the strategies for addressing the ageing population issue. My sense is that many people would prefer to kick the can down the road. It will have some big repercussions for us Gen Y and Gen X
Sometime in the future Kiwisaver's faults are going to come home to roost. Governments are going to start removing National Super's universality. Why should you get a full Super payment and have all that Kiwisaver money you've been setting aside since 2007?
And how 'generous' will Super be? Will it drop from 66% of the ‘average ordinary time wage’ to some lesser percentage or be set at a fixed amount and be left to each government to raise it if they feel like it, a bit like some other benefits.
So, Kiwisaver's faults. All governments have allowed it to be raided for non-retirement purposes, which pushes the burden back on to the state to provide higher retirement benefits - but hey that's someone else's problem as the can is kicked down the road.
It is a scheme that locks in income inequality: - if you've been living on struggle street in low paid work during your working life then once you have to retire (which may be well past the retirement age) you're still going to be on struggle street because there just isn't that much money in your Kiwisaver account.
But probably the worst aspect of it is how it treats women. (I'll say it for you Kath). Early working life is fine, except for that gender pay gap, but then she marries and along comes a kid, or two, or ... and she leaves work to raise the kids. No deposits going into her Kiwisaver account because she isn't working. Then once the kids are off to school it's a low paid / part time job which means a low contribution to her Kiwisaver account. Or maybe she opts out because she needs that money to feed, clothe and house the children.
Thanks Steve. I was awoken at 4am by noxious hoons driving at speed in their truck around the locale ripping up verges and grassed community areas. I have to say this feels much the same as what Bernard got up for. Lots and lots of needless damage when viewed in the light of day from this “play” by bankers and markets. The verges are at least real. WhereS there is nothing proven to be real about this social construct we call money. What they won’t do to avoid responsibility and wealth taxes astounds me much like the local male teenage nuisances. 😂
My eyes glaze over and stomach sinks when I read all this wordiness about superann and how it can't be afforded and people don't need it and Winston Peters and on and on and on.
I don't have any Winston Peters among my friends. My friends are mainly women who have worked for non-glamorous wages and raised children following which they often find themselves working for even less glamorous wages. They start struggling to keep their health together because they are totally exhausted with it all and eventually reach the finish line of the marathon and qualify for superan so that for the first time they know they are assured of a way to pay the bills. I dont think this side of the story is told enough. its not just a story of superan, it's a story of how much women still work for nothing.
GMI would and should be more adequate than UBI touted which is just too low. Agree with everything you say women’s labour is completely unaccounted for in all the “models” and men (as a class) will do anything include pretend adequate Child Support and maintenance and the PRA 1976 don’t exist let alone are law. So the patriarchy’s/establishments answer has been to get women and children trapped into benefits, criminalise reproductive choices for women and block access to longstanding obligations, rights and laws like the Family Proceedings Act. It’s really outrageous but we are meant to remain a grateful slave class to keep the male slave class serviced and fed.If you can’t cope with that the State literally farms them out and monetises them in institutions rather than support them and their Mothers. All still very Dickensian and like “poor houses” and the institutions who abuse and kill children and women to raise money. We haven’t come very far and it really is the elephant in the room. When we look at the sadism of the “business model” it’s hardly surprising they’ve killed another Earth as well with their exploitation for an “economy”.People have got life sentences as war criminals and crimes against humanity for less. This is on a massive and universal scale with more women killed by men than in ALL wars worldwide and it’s constant and unabating.
I am more in favour of a UBI, than against. But how the UBI is structured is the problem. Will it be like National Super for everyone over the age of 18? Or will it be some stingy amount less than that which requires the benefit system to be keep running? More bureaucracy.
And I am in favour of having IRD open up everyone's income tax return to public scrutiny. I think Sweden has done something like this. So if you work in a mixed sex job with everyone doing the same thing you can check to see if you're being underpaid (maybe because you're a 'girl'). And if the boss pleads there isn't enough money to give a pay rise, then just look up his tax return.
The real issue for women is the reproductive and other care labour and contributions we make which are entirely unaccounted for despite contributing massive amounts to the economy.The sex pay gap is just a no brained but not the main issue as we are still being reduced to breeders with no rights despite efforts to stop that. Agree all income should be transparent as this is another way we are all bullshitted about partners/spouse earnings and assets for children and in the bigger picture as well to hide the really wealthy types with control or benefitting from of heaps of assets and money inequitably and can hide it all to avoid tax and their obligations. Many good ideas to fix all this but no political will to get in done. Let’s face it Government is full of the bigoted, rich and/secure and not really precarious in the slightest and it pays for them to keep us all that way so we can be exploited by them.
Bearing in mind we have at least 7000 children in institutional care here still because Mothers are not supported adequately and they themselves, as Wendy pointed out, are entirely overburdened and under resourced to do the role when one person (produced by women’s labour) is worth $4m USD-$10m to the “economy” if things go well. They are underwriters figures albeit they should probably look at undertakers books as well to see the cost to women of propping up “the economy” unsupported, dehumanised, vulnerable, exploited and physically, mentally, emotionally and economically abused and damaged to do so. God forbid we talk about these FACTS or teach our children about it as well. It’s pretty sick.
"Nuclear is the rubicon yet to be crossed by Green parties here. We’re getting closer." Leaving aside the question of waste storage in a country consisting largely of tectonic fault lines, have you looked into uranium availability and then factored in rising demand as more and more governments decide this is their magic climate solution?
Once you've found someone to build your power plant (this will be easy, it isn't a tiny global industry with ferociously prohibitive safety standards fencing out new players) and found a place to put it (the key phrases here are "exclusion zone" and "nimby"), you'll be able to look forward to cheap, reliable power (with only the minor problem of safely storing the waste)... until the uranium reserves start to run down. There's a lot of the stuff in the ground, until you start looking at it as the replacement resource for fossil fuels. In those terms, factoring in our current energy needs, there's maybe five decades worth.
Nuclear is only an energy solution if you frame the problem as "please make this go away until I'm dead". Then the next generation gets to face exactly the same energy crisis, except they also have to find a way to stop climate-related disasters from compromising all those nuclear waste dumps.
5 decades worth is plenty. Putin has ended the Gas as a transition fuel option. Nuclear is better than coal and oil. Until such a time that the global economy can meaningfully switch to renewables without the median voter becoming poorer in the process/dramatically shift their lifestyle in unrealistic ways I’m yet to see a better option. I’m not just talking about the median voter in the NZ either, the median voter in India and Indiana will ultimately decide how
"Unrealistic". You are seriously using the term "unrealistic" in the middle of suggesting that nuclear is a good option for New Zealand. Since we're being realistic about this, talk me through the politics of finding a plant location here and then finding a local council to host the waste dump.
I was specifically addressing Bernard's notion that our Greens may one day need to face the idea of nuclear as a sensible option for NZ -- which I think falls down at every level. (They wouldn't even if it *was* sensible, but it isn't). But as to your global argument -- okay, I'll give you "realistic" there, you're quite likely right that this is where the pressure to maintain energy wealth takes us. I don't think future generations will love us for it, but that's a separate argument.
The elephant in the room isn't nuclear power. It's our current power companies building just enough new generation to meet demand and to maximise their profits. They currently have enough consents to power a 100% EV fleet.
Government should sell down from it's 51% ownership of the generators and use the proceeds to build Lake Onslow. Give Onslow the remit to start generating whenever the spot price goes over a certain price point, and NOT require it to produce dividends.
Hi Steve I agree, I’m pro clean energy so pro nuke (in the right place of course). I think electricity in a country with aspersions of being in the first world. Should be Clean, Cheap and Plentiful.
So in a small country it has to be owned by the government, it’s not a model suited to corporate bullshit.
We've gone beyond electricity generation being a government monopoly, and can't reverse that. I'd sell out of the gentailers and have the only government involvement being Lake Onslow, Transpower and a big regulatory stick. Of course we know that last one doesn't exist (sarcasm).
We can reverse that. In the 2000's the government bought back Air NZ & Railways because the new private owners were totally incompetent. We can do the same with power & we should. Affordable power is a basic human right, like affordable housing, free education & the right to work. We will never achieve the energy targets linked to climate change while 49% of our power system is controlled by (eventually) overseas greed merchants.
We’re ruled by bean counters nowadays and it shows. We’re a failing country on so many levels due to short sighted greed. Cheep energy = cheap clean heating, more electric vehicles, more ability to cost effectively add value to our exports which leads to more high paying jobs. The list goes on and on.
I particularly don't feel like robbing from children for my future, so why should it continue with the generations today. If anything, I'd like my Superannuation now not later.
Retirement funded by property asset inflation is great for those who own property to start with, only downside is not everyone owns property and lately it's a pipe dream to even afford such an asset. So what becomes of the 30 year olds today, and when they are set to retire in 2057 when they don't have property, and may not have the prospect of superannuation or even enough in Kiwisaver to live off. Suppose kicking the can down the generational road is what has, and will continue to be kicked until someone is ballsy enough to say no. Currently no contenders by the looks of the political spectrum unless I've been living under a rented rock.
I have said before that the electricity price should be tagged to the price of aluminium. If the aluminium price falls below a certain point then Meridian/Contact credit Tiwai a set amount per tonne. But if the price of aluminium goes over a higher set amount then Tiwai credits Meridian/Contact.
These net credits are held in an account by Tiwai. No cash changes hand. It is only when Tiwai Point closes down that the balance of the account is paid out to whomever is entitled to it.
The big problem though is agreeing the two aluminium prices.
It wouldn't though have any influence on our household price.
Perhaps 2073 is a bit too far away, but we can all envisage 2052 in 30 years. In that time most of the boomers will have gone, and their self-owned homes will one way or another be distributed among their off-spring. In this time (30 years) society must work out an equitable way of housing people that don't have the benefits of home owning parents. The European system of renting secure homes for life springs to mind, and these building could be owned by the state or by corporations. Meanwhile the state must build and build, to make up for the years of neglect.
Hi Bernard thanks so much for getting up at 4.00 and translating the biggies of the economic world into words and concepts I'm slowly becoming more familiar with. What I'm trying to do is link your economic perspectives with Marilyn Waring's. Do you see any connecting threads, however fine? I'm putting this link on because I found it a beautiful documentary and maybe some of the men on here are not familiar with it. https://aeon.co/videos/we-all-play-by-economic-rules-set-by-men-what-could-a-feminist-economics-look-like
Stats NZ nos confirmed what we all know. We can’t afford 1m boomers getting NZ super from 65 to 90 (without a doubling in the working age popn through mega immigration or a baby boom) as well as the associated demand in health care costs. Super age needs to rise to 70, within a decade, and it needs stop being a universal benefit. There is no justification for taxing cleaners in order give the money to Winston Peters etc.
I tend to agree with NZ Super being a universal benefit at age 65 not later - but ALSO means tested. It doesn't make sense that millionaires get the same amount as me (a non millionaire and a renter to boot) I was so worn out and weary of life before 65 happened and I kept working until redundancy at 67 - if I had to hold out to 70 I would be dead by now.
If you give people enough time they can plan accordingly and can choose to retire at a time of their choosing. Hopefully spend their final years in roles where they pass on their valuable experience to the next generations.
Shit happens Julian. Best laid plans of mice and men often go wrong (Burns) In other words you can build a secure world (mouse nest) but it still goes wrong (the farmers plough) so some things are beyond your control. But yes, I am spending my final years passing on my wisdom which is means test superannuation.
NZ superannuation should be income tested. A person with a gross taxable income twice superannuation should not be able to still get NZ superannuation.
second sentence should be:
A person with a gross taxable income (in addition to superannuation) twice superannuation should not be able to still get NZ superannuation.
Hi Bernard, The stats data is interesting - especially the growing over 65+. Are you able to do some sessions on long term strategies and the pros and cons of the strategies for addressing the ageing population issue. My sense is that many people would prefer to kick the can down the road. It will have some big repercussions for us Gen Y and Gen X
Do you think humanity will look remotely like it does today in 2073?
He's an economist, not a prophet 😂
Read the newsletter, he's making predictions about 2073
Sometime in the future Kiwisaver's faults are going to come home to roost. Governments are going to start removing National Super's universality. Why should you get a full Super payment and have all that Kiwisaver money you've been setting aside since 2007?
And how 'generous' will Super be? Will it drop from 66% of the ‘average ordinary time wage’ to some lesser percentage or be set at a fixed amount and be left to each government to raise it if they feel like it, a bit like some other benefits.
So, Kiwisaver's faults. All governments have allowed it to be raided for non-retirement purposes, which pushes the burden back on to the state to provide higher retirement benefits - but hey that's someone else's problem as the can is kicked down the road.
It is a scheme that locks in income inequality: - if you've been living on struggle street in low paid work during your working life then once you have to retire (which may be well past the retirement age) you're still going to be on struggle street because there just isn't that much money in your Kiwisaver account.
But probably the worst aspect of it is how it treats women. (I'll say it for you Kath). Early working life is fine, except for that gender pay gap, but then she marries and along comes a kid, or two, or ... and she leaves work to raise the kids. No deposits going into her Kiwisaver account because she isn't working. Then once the kids are off to school it's a low paid / part time job which means a low contribution to her Kiwisaver account. Or maybe she opts out because she needs that money to feed, clothe and house the children.
Thanks Steve. I was awoken at 4am by noxious hoons driving at speed in their truck around the locale ripping up verges and grassed community areas. I have to say this feels much the same as what Bernard got up for. Lots and lots of needless damage when viewed in the light of day from this “play” by bankers and markets. The verges are at least real. WhereS there is nothing proven to be real about this social construct we call money. What they won’t do to avoid responsibility and wealth taxes astounds me much like the local male teenage nuisances. 😂
My eyes glaze over and stomach sinks when I read all this wordiness about superann and how it can't be afforded and people don't need it and Winston Peters and on and on and on.
I don't have any Winston Peters among my friends. My friends are mainly women who have worked for non-glamorous wages and raised children following which they often find themselves working for even less glamorous wages. They start struggling to keep their health together because they are totally exhausted with it all and eventually reach the finish line of the marathon and qualify for superan so that for the first time they know they are assured of a way to pay the bills. I dont think this side of the story is told enough. its not just a story of superan, it's a story of how much women still work for nothing.
ps and don't suggest targeting to the needy or else at 77 WINZ will have to pry around to find if I might be sleeping with someone.
Advantages of UBI from the beginning seem worth considering
GMI would and should be more adequate than UBI touted which is just too low. Agree with everything you say women’s labour is completely unaccounted for in all the “models” and men (as a class) will do anything include pretend adequate Child Support and maintenance and the PRA 1976 don’t exist let alone are law. So the patriarchy’s/establishments answer has been to get women and children trapped into benefits, criminalise reproductive choices for women and block access to longstanding obligations, rights and laws like the Family Proceedings Act. It’s really outrageous but we are meant to remain a grateful slave class to keep the male slave class serviced and fed.If you can’t cope with that the State literally farms them out and monetises them in institutions rather than support them and their Mothers. All still very Dickensian and like “poor houses” and the institutions who abuse and kill children and women to raise money. We haven’t come very far and it really is the elephant in the room. When we look at the sadism of the “business model” it’s hardly surprising they’ve killed another Earth as well with their exploitation for an “economy”.People have got life sentences as war criminals and crimes against humanity for less. This is on a massive and universal scale with more women killed by men than in ALL wars worldwide and it’s constant and unabating.
Couldn't agree more with your comments.
I am more in favour of a UBI, than against. But how the UBI is structured is the problem. Will it be like National Super for everyone over the age of 18? Or will it be some stingy amount less than that which requires the benefit system to be keep running? More bureaucracy.
And I am in favour of having IRD open up everyone's income tax return to public scrutiny. I think Sweden has done something like this. So if you work in a mixed sex job with everyone doing the same thing you can check to see if you're being underpaid (maybe because you're a 'girl'). And if the boss pleads there isn't enough money to give a pay rise, then just look up his tax return.
The real issue for women is the reproductive and other care labour and contributions we make which are entirely unaccounted for despite contributing massive amounts to the economy.The sex pay gap is just a no brained but not the main issue as we are still being reduced to breeders with no rights despite efforts to stop that. Agree all income should be transparent as this is another way we are all bullshitted about partners/spouse earnings and assets for children and in the bigger picture as well to hide the really wealthy types with control or benefitting from of heaps of assets and money inequitably and can hide it all to avoid tax and their obligations. Many good ideas to fix all this but no political will to get in done. Let’s face it Government is full of the bigoted, rich and/secure and not really precarious in the slightest and it pays for them to keep us all that way so we can be exploited by them.
Bearing in mind we have at least 7000 children in institutional care here still because Mothers are not supported adequately and they themselves, as Wendy pointed out, are entirely overburdened and under resourced to do the role when one person (produced by women’s labour) is worth $4m USD-$10m to the “economy” if things go well. They are underwriters figures albeit they should probably look at undertakers books as well to see the cost to women of propping up “the economy” unsupported, dehumanised, vulnerable, exploited and physically, mentally, emotionally and economically abused and damaged to do so. God forbid we talk about these FACTS or teach our children about it as well. It’s pretty sick.
"Nuclear is the rubicon yet to be crossed by Green parties here. We’re getting closer." Leaving aside the question of waste storage in a country consisting largely of tectonic fault lines, have you looked into uranium availability and then factored in rising demand as more and more governments decide this is their magic climate solution?
Once you've found someone to build your power plant (this will be easy, it isn't a tiny global industry with ferociously prohibitive safety standards fencing out new players) and found a place to put it (the key phrases here are "exclusion zone" and "nimby"), you'll be able to look forward to cheap, reliable power (with only the minor problem of safely storing the waste)... until the uranium reserves start to run down. There's a lot of the stuff in the ground, until you start looking at it as the replacement resource for fossil fuels. In those terms, factoring in our current energy needs, there's maybe five decades worth.
Nuclear is only an energy solution if you frame the problem as "please make this go away until I'm dead". Then the next generation gets to face exactly the same energy crisis, except they also have to find a way to stop climate-related disasters from compromising all those nuclear waste dumps.
5 decades worth is plenty. Putin has ended the Gas as a transition fuel option. Nuclear is better than coal and oil. Until such a time that the global economy can meaningfully switch to renewables without the median voter becoming poorer in the process/dramatically shift their lifestyle in unrealistic ways I’m yet to see a better option. I’m not just talking about the median voter in the NZ either, the median voter in India and Indiana will ultimately decide how
much coal/uranium gets used.,
"Unrealistic". You are seriously using the term "unrealistic" in the middle of suggesting that nuclear is a good option for New Zealand. Since we're being realistic about this, talk me through the politics of finding a plant location here and then finding a local council to host the waste dump.
Was talking globally but since you seem so keen on nuclear, how big is your back garden? 😉
I was specifically addressing Bernard's notion that our Greens may one day need to face the idea of nuclear as a sensible option for NZ -- which I think falls down at every level. (They wouldn't even if it *was* sensible, but it isn't). But as to your global argument -- okay, I'll give you "realistic" there, you're quite likely right that this is where the pressure to maintain energy wealth takes us. I don't think future generations will love us for it, but that's a separate argument.
My back garden, alas, is a deck.
“Nuclear is the rubicon yet to be crossed by Green parties here. We’re getting closer.”
What next reopen our Oil Refinery?
I can’t really see NZ needing a Nuclear plant, surely we can do more Geothermal?
Hi Craig
The elephant in the room isn't nuclear power. It's our current power companies building just enough new generation to meet demand and to maximise their profits. They currently have enough consents to power a 100% EV fleet.
Government should sell down from it's 51% ownership of the generators and use the proceeds to build Lake Onslow. Give Onslow the remit to start generating whenever the spot price goes over a certain price point, and NOT require it to produce dividends.
Hi Steve I agree, I’m pro clean energy so pro nuke (in the right place of course). I think electricity in a country with aspersions of being in the first world. Should be Clean, Cheap and Plentiful.
So in a small country it has to be owned by the government, it’s not a model suited to corporate bullshit.
We've gone beyond electricity generation being a government monopoly, and can't reverse that. I'd sell out of the gentailers and have the only government involvement being Lake Onslow, Transpower and a big regulatory stick. Of course we know that last one doesn't exist (sarcasm).
Well with the will things can change. But yeah. Funny how govt monopolies are such a bad thing but corporate ones are ok. Kiwis love them so it seems!
We can reverse that. In the 2000's the government bought back Air NZ & Railways because the new private owners were totally incompetent. We can do the same with power & we should. Affordable power is a basic human right, like affordable housing, free education & the right to work. We will never achieve the energy targets linked to climate change while 49% of our power system is controlled by (eventually) overseas greed merchants.
I agree Dean,
We’re ruled by bean counters nowadays and it shows. We’re a failing country on so many levels due to short sighted greed. Cheep energy = cheap clean heating, more electric vehicles, more ability to cost effectively add value to our exports which leads to more high paying jobs. The list goes on and on.
I particularly don't feel like robbing from children for my future, so why should it continue with the generations today. If anything, I'd like my Superannuation now not later.
Retirement funded by property asset inflation is great for those who own property to start with, only downside is not everyone owns property and lately it's a pipe dream to even afford such an asset. So what becomes of the 30 year olds today, and when they are set to retire in 2057 when they don't have property, and may not have the prospect of superannuation or even enough in Kiwisaver to live off. Suppose kicking the can down the generational road is what has, and will continue to be kicked until someone is ballsy enough to say no. Currently no contenders by the looks of the political spectrum unless I've been living under a rented rock.
Time has rolled around again.
https://www.newshub.co.nz/home/money/2022/07/tiwai-point-aluminium-smelter-begins-talks-with-power-companies-to-stay-open-after-2024.html
Once again.
Is the price of electricity to the aluminium smelter going to be partially tagged proportionally to the global price of aluminium? If not why not?
It would be nice if such a pricing scheme pass could pass along excess profits to lower wholesale electricity prices to households.
https://thekaka.substack.com/p/ask-me-anything-about-the-week-that-041/comment/5246763
Hi David
I have said before that the electricity price should be tagged to the price of aluminium. If the aluminium price falls below a certain point then Meridian/Contact credit Tiwai a set amount per tonne. But if the price of aluminium goes over a higher set amount then Tiwai credits Meridian/Contact.
These net credits are held in an account by Tiwai. No cash changes hand. It is only when Tiwai Point closes down that the balance of the account is paid out to whomever is entitled to it.
The big problem though is agreeing the two aluminium prices.
It wouldn't though have any influence on our household price.
Perhaps 2073 is a bit too far away, but we can all envisage 2052 in 30 years. In that time most of the boomers will have gone, and their self-owned homes will one way or another be distributed among their off-spring. In this time (30 years) society must work out an equitable way of housing people that don't have the benefits of home owning parents. The European system of renting secure homes for life springs to mind, and these building could be owned by the state or by corporations. Meanwhile the state must build and build, to make up for the years of neglect.
There is no such thing as a soft landing in aviation terms:
a good landing you can walk away
an excellent landing you can fly again
a crash landing you are unlikely to do either
buckle up NZ
Hi Bernard thanks so much for getting up at 4.00 and translating the biggies of the economic world into words and concepts I'm slowly becoming more familiar with. What I'm trying to do is link your economic perspectives with Marilyn Waring's. Do you see any connecting threads, however fine? I'm putting this link on because I found it a beautiful documentary and maybe some of the men on here are not familiar with it. https://aeon.co/videos/we-all-play-by-economic-rules-set-by-men-what-could-a-feminist-economics-look-like