I wonder how much of the fall in consumer confidence is linked to the fact that people can see their KiwiSaver balance on their banking apps? Apart from the sharp fall and associated increase during the March 2020 Covid crisis, this will be first time that people have seen their retirement savings wealth fall dramatically, at the same time that mortgage rates and prices are going up.
Agree it seems weird that consumer spending is not yet reflecting the forward looking view of consumers ... interest rates are only just starting to take a bigger bite out of consumer spending power, so I suspect we will see consumer spending slow up pretty quickly over the next 6mths. In addition, I hear the credit stress in unsecured lending is starting to emerge over the last 6 weeks. Might be worth chatting with Centrix on this.
Another piece of evidence in the puzzle of low consumer confidence and collective worry: My paediatrician wife says she and her colleagues have never seen (in her case over a 40 yr career) so many children presenting with high anxiety. Presumably reflecting their parents state of mind.
Hi Bernard, could you dive into how fit for purpose the consumer confidence index even is? It feels incredibly flawed on a number of levels. Firstly, as you pointed out, due to the fact the statistics do not reconcile with the survey, which reflects the power of certain stories being told and held, regardless of the reality. Secondly, (and perhaps more importantly) the fact we are still seeking to assess people's engagement and understanding of the economy based on their intended consumption, in a midst of global converging crises, where "consuming" our way out of global warming and biodiversity loss isn't physically possible and in fact perpetuating the crisis. I wonder if it was replaced with a citizen confidence index (informing on engagement on policy and strategy in governments and organisations big and small - per Jon Alexander's suggestion), or removed entirely as a distraction would be more helpful? Cheers, Georgia
Is it possible to segment the consumer confidence data by household type or age?
You talk often about "household wealth is increasing", but that really only applies to households which actually own property, which I think was 64% at the last census. If you could segment the consumer confidence and look at 19-30 year olds, or households who don't rent by choice, you might see a slightly different story. (Or maybe you'd see the exact same story, but you can't know until you try.)
Our mass psyche, behavioural economics, slump in consumer confidence…… the difference between past decades and now is the conveyor belt of “the sky is falling down” doom merchant predictions on the front page, 6 o'clock news, Twitter, Facebook and every which way you turn. China threats, Ukraine, Covid, 501s, global warming, the list on goes…. Misery loves company. Plenty of data says we live in a more prosperous time than ever before – better health & education, less poverty, less wars, less crime…..globally.
The citizens feel powerless, badly served, isolated and constantly at risk. No one wants to see their neighbours or community fail or be risked either. There are no optimistic projections nor action on what will help us all and the public is not silly anymore, greater forces than the individual are dictating our free will, support and lives. Hateful lying and inequity being covered up and normalised conduct really. So people has lost confidence in authority and Goverrnment. This morning Chris Hopkins admitted he lied about offering Charlotte Bellis consulate support. What can get done with people who abuse their power over us like that? Sorry doesn’t cut it and it endangers women, pregnant women at that. She is a higher profile women than most who get mistreated by those who should and can be supportive in power. I think there is a crisis in confidence in politics, governments and the related financial, military, industrial complex risking us all and getting much richer for it. Really they’ve been beck owned by facts now matter how hard the establishment tries to obfuscate or suppress them.
1. What kind of military police and institutions can’t keep our borders secure or a virus out? By good process.
3. What kind of Government could allow something like the level of clear exploitation and abuse evidenced in schools and the abuse in care as well as Gloriavale continue?
3. What kind of morons believe human babies don’t need their human Mothers with them 24/7 to be well and supported?
4. Who thinks old winding and narrow roads were built for massive trucks?
The list goes on and on….
I don’t think this survey reflects only financial dissatisfaction after all they’re constantly TELLING us we need a million dollars at least each to retire and then put as many barriers in front of us all as possible throughout our lives. I think everyone is fed up with it all. It’s become one step forward two back and politicians seem blithely unaware and unable to put in place the necessary reforms.
Especially for women, children and the vulnerable. It’s a mans world still. Despite being illegal and immoral corruption. No one wants to say it they’re still “playing the game” without any consideration of facts or evidence. The silencing and infantilising of women isn’t an accident.
Hi Bernard, I agree that its not that simple to change from one plasterboard to another for residential construction. The bracing calculations for the house will need to be checked to ensure there's enough "bracing units". This is easily checked for GIB as they provide handy calculators that work together with their other proprietary products (GIB handibracs, ceiling diaphragms, etc). Councils, Architects and Engineers have confidence in this product from years of experience and performance in previous earthquakes. Any new imported system will also require relevant testing data before designers have the confidence to sign their names to it.
Goodness Bernard, blaming social media for our growing disbelief in dystopian capitalism? My mother assured me that rockin’roll and Beatle haircuts were responsible!
Maybe the fall in so-called consumer confidence reflects a realisation that we can't keep on spending our way through climate emergency, that we don't actually need half of what we buy and that shelter, warmth, food and water plus the odd book is really the only things we need (and to replace the odd washing machine etc.) I adopted an unshopper model a while ago & it saves a lot of time, money and bother. Shopping became a hobby for many of us but Covid maybe changed our attitude a little to hanging out in malls. Also the world became way more uncertain, and people looked to their own backyards in the form of buying out seeds, compost and plants. I am thinking that health has become a big priority as has the environment, food and the joys of seeing family and friends. I do look at those container ships and wonder what things are actually needed (apart from gib and sending our processed wood back to us).
I wonder how much of the fall in consumer confidence is linked to the fact that people can see their KiwiSaver balance on their banking apps? Apart from the sharp fall and associated increase during the March 2020 Covid crisis, this will be first time that people have seen their retirement savings wealth fall dramatically, at the same time that mortgage rates and prices are going up.
Agree it seems weird that consumer spending is not yet reflecting the forward looking view of consumers ... interest rates are only just starting to take a bigger bite out of consumer spending power, so I suspect we will see consumer spending slow up pretty quickly over the next 6mths. In addition, I hear the credit stress in unsecured lending is starting to emerge over the last 6 weeks. Might be worth chatting with Centrix on this.
Another piece of evidence in the puzzle of low consumer confidence and collective worry: My paediatrician wife says she and her colleagues have never seen (in her case over a 40 yr career) so many children presenting with high anxiety. Presumably reflecting their parents state of mind.
Hi Bernard, could you dive into how fit for purpose the consumer confidence index even is? It feels incredibly flawed on a number of levels. Firstly, as you pointed out, due to the fact the statistics do not reconcile with the survey, which reflects the power of certain stories being told and held, regardless of the reality. Secondly, (and perhaps more importantly) the fact we are still seeking to assess people's engagement and understanding of the economy based on their intended consumption, in a midst of global converging crises, where "consuming" our way out of global warming and biodiversity loss isn't physically possible and in fact perpetuating the crisis. I wonder if it was replaced with a citizen confidence index (informing on engagement on policy and strategy in governments and organisations big and small - per Jon Alexander's suggestion), or removed entirely as a distraction would be more helpful? Cheers, Georgia
Is it possible to segment the consumer confidence data by household type or age?
You talk often about "household wealth is increasing", but that really only applies to households which actually own property, which I think was 64% at the last census. If you could segment the consumer confidence and look at 19-30 year olds, or households who don't rent by choice, you might see a slightly different story. (Or maybe you'd see the exact same story, but you can't know until you try.)
Our mass psyche, behavioural economics, slump in consumer confidence…… the difference between past decades and now is the conveyor belt of “the sky is falling down” doom merchant predictions on the front page, 6 o'clock news, Twitter, Facebook and every which way you turn. China threats, Ukraine, Covid, 501s, global warming, the list on goes…. Misery loves company. Plenty of data says we live in a more prosperous time than ever before – better health & education, less poverty, less wars, less crime…..globally.
The citizens feel powerless, badly served, isolated and constantly at risk. No one wants to see their neighbours or community fail or be risked either. There are no optimistic projections nor action on what will help us all and the public is not silly anymore, greater forces than the individual are dictating our free will, support and lives. Hateful lying and inequity being covered up and normalised conduct really. So people has lost confidence in authority and Goverrnment. This morning Chris Hopkins admitted he lied about offering Charlotte Bellis consulate support. What can get done with people who abuse their power over us like that? Sorry doesn’t cut it and it endangers women, pregnant women at that. She is a higher profile women than most who get mistreated by those who should and can be supportive in power. I think there is a crisis in confidence in politics, governments and the related financial, military, industrial complex risking us all and getting much richer for it. Really they’ve been beck owned by facts now matter how hard the establishment tries to obfuscate or suppress them.
1. What kind of military police and institutions can’t keep our borders secure or a virus out? By good process.
3. What kind of Government could allow something like the level of clear exploitation and abuse evidenced in schools and the abuse in care as well as Gloriavale continue?
3. What kind of morons believe human babies don’t need their human Mothers with them 24/7 to be well and supported?
4. Who thinks old winding and narrow roads were built for massive trucks?
The list goes on and on….
I don’t think this survey reflects only financial dissatisfaction after all they’re constantly TELLING us we need a million dollars at least each to retire and then put as many barriers in front of us all as possible throughout our lives. I think everyone is fed up with it all. It’s become one step forward two back and politicians seem blithely unaware and unable to put in place the necessary reforms.
Especially for women, children and the vulnerable. It’s a mans world still. Despite being illegal and immoral corruption. No one wants to say it they’re still “playing the game” without any consideration of facts or evidence. The silencing and infantilising of women isn’t an accident.
Heres a new take on the imminent food miles issue that may give our farmer's apoplexy https://www.nature.com/articles/s43016-022-00531-w
Your comments would of course be appreciated!
Hi Bernard, I agree that its not that simple to change from one plasterboard to another for residential construction. The bracing calculations for the house will need to be checked to ensure there's enough "bracing units". This is easily checked for GIB as they provide handy calculators that work together with their other proprietary products (GIB handibracs, ceiling diaphragms, etc). Councils, Architects and Engineers have confidence in this product from years of experience and performance in previous earthquakes. Any new imported system will also require relevant testing data before designers have the confidence to sign their names to it.
Goodness Bernard, blaming social media for our growing disbelief in dystopian capitalism? My mother assured me that rockin’roll and Beatle haircuts were responsible!
An intelligent article by David McLeish. In line with much that you have been saying, Bernard.
https://fisherfunds.co.nz/newsroom/market-commentary/what-if-rate-hikes-are-doing-more-harm-than-good?utm_source=marketingcloud&utm_medium=email&utm_campaign=FF+Newsletter+June+2022+Main
Maybe the fall in so-called consumer confidence reflects a realisation that we can't keep on spending our way through climate emergency, that we don't actually need half of what we buy and that shelter, warmth, food and water plus the odd book is really the only things we need (and to replace the odd washing machine etc.) I adopted an unshopper model a while ago & it saves a lot of time, money and bother. Shopping became a hobby for many of us but Covid maybe changed our attitude a little to hanging out in malls. Also the world became way more uncertain, and people looked to their own backyards in the form of buying out seeds, compost and plants. I am thinking that health has become a big priority as has the environment, food and the joys of seeing family and friends. I do look at those container ships and wonder what things are actually needed (apart from gib and sending our processed wood back to us).