web analytics
The Standard

Wheeler lies on bank profits

Written By: - Date published: 10:05 am, December 5th, 2012 - 33 comments
Categories: capitalism - Tags:

Last month, new Reserve Bank Governor Graeme Wheeler told Parliament that our banks aren’t excessively profitable – middle of the pack internationally. He was lying.

Russel Norman asked the RBNZ for its evidence. The graph they supplied was a desperate attempt at deception. It omitted Europe’s banks, it compared our banks’ after-tax profits to other countries’ pre-tax profits – and our banks were still the 5th most profitable!

Wheeler’s excuse is that he didn’t have the facts in front of him when he made his false statement to our Parliament – oh well, that’s alright then!

Don’t forget, the billions in banks profits that flow over the Tasman every year are the biggest contributor to our growing international debt, behind only oil imports.

Looks like we’ve got another Reserve Bank Governor who will put the interests of the Aussie banks ahead of New Zealanders and New Zealand jobs every time.

33 comments on “Wheeler lies on bank profits”

  1. outofbed 1

    Seems to me one of the most interesting aspects of this post is that Russel Norman and the Greens are on to it once again!

  2. vto 2

    I read somewhere recently that 25% of corporate earnings in the USA in the last year were in the banking and finance sector.

    Another sign of the end-times our system is in.

    Speaking of which – only a few days until the end of the Mayan calender. Prepare your survival packs.

  3. Lanthanide 3

    Gareth Morgan is very derisive of the past 15 years of reserve bank governance, and particularly thinks keeping the interest rate at 2.5% (one of the highest in the world) is insane at the moment.

    Hopefully we’ll get a rate reduction tomorrow, but seems unlikely.

    • geoff 3.1

      Yeah this is what I dont get, why not reduce the official cash rate by another percent? It would lower the exchange rate and give some mortgage relief to homeowners.

      • andy (the other one) 3.1.1

        Lowering the OCR will allow people to borrow larger amounts further fuelling the the current bubble we already have in the Auckland market.

        That will further push home ownership out of the hands of the battlers out on struggle street. It would also allow the mortgage holders to further leverage themselves and out bid other buyers. We need an OCR rise of 0.05% to prick the bubble that is forming..

        • Lanthanide 3.1.1.1

          No, we need the OCR to be dropped 1% and a residential mortgage tax of 1% introduced.

        • aj 3.1.1.2

          Unfortunately, the very processes required to burst the property bubble are ones that will make home affordability a problem for a larger group of people in the short term. Once you have enough people out of the lower and mid-range of the market the whole house [pardon the pun] of cards falls slowly over.
          Long term everyone will be better off.

          • Neoleftie 3.1.1.2.1

            FFS we are the fifth highest traded currency due to high interest rates. part of the new house deal should be govt mortgages via kiwi bank at a low interest rate using printed money. How about that CV.

            • Colonial Viper 3.1.1.2.1.1

              Sounds good to me. The interest rate would be very low, it would be a 30 year term, it would be for a first (and only) house, there would be tight income thresholds applicable, and strict expectations on the upkeep of the property.

        • KJT 3.1.1.3

          Rubbish.

          The reason why the banks are pushing so much money into NZ to borrow and push up house prices is, because! our interest rates are too high.

          Lowering interest rates will drop the amount of overseas loan money coming in.

          An OCR rise, (as an inflation fighting method) is an overly blunt instrument which hurts business, existing home owners and other borrowers who cannot change their circumstances.
          By all means put a tax on new loans if necessary, but the OCR is way too high when the US bank rate is effectively zero.

          • geoff 3.1.1.3.1

            Dont tax new loans, eradicicate the monopolies which have been robbing NZ blind for 30 years! ie Fletchers, Property Developer biased Councils.

            • Colonial Viper 3.1.1.3.1.1

              tax new loans as well.

              Also a massive stamp duty if you buy/sell more than one house per 5 years.

          • mikesh 3.1.1.3.2

            I suspect that the banks have an interest in keeping the dollar high. They have probably borrowed so much from overseas that a reduction in the value of the dollar would cause them big losses. Since it is borrowing that keeps the exchange rate up I think banks will continue to borrow whatever the interest rate.

        • geoff 3.1.1.4

          The housing bubble in Auckland is due to a shortage of houses, raising the OCR will do nothing to change that, it will just cause more pain for people.

          The Auckland housing shortage is due to high land prices and high building material prices.

          The price of land is due mostly to population growth (less land available per person) and councils acting in the interest of property developers and owners rather than people attempting to become property owners.

          The price of building is mostly due to Fletchers having the monopoly of building materials.

          Essentially a big part of the problem is greedy cunts.

          • Colonial Viper 3.1.1.4.1

            The housing bubble in Auckland is partly due to a shortage of houses, raising the OCR will do nothing to change that, it will just cause more pain for people.

            Just to clarify. There is more than one factor at play here. Including too many people who own 5, 6, 7, 8+ Auckland residential properties.

            • geoff 3.1.1.4.1.1

              Yeah where partly equals 90%.

              This idea that’s been circulating that ‘the problems really complicated, it’s really tough to figure out’. Total bullshit.

              Yet again personal greed amongst a minority is screwing over large segments of the country.

              I also think it’s sick that some people have multiple rentals but that isn’t why there is a housing shortage. The reason there is a shortage is simply a growing population and not enough housing to go around.

              • Colonial Viper

                The problem is complicated but I agree with you that its NOT tough to figure out.

                A few posters have already described the main problem – which I believe the housing “shortage” you are referring to is but a symptom.

                Basically, its assanine to try and fit 30% of the country’s population in 0.3% of the space. Especially as provincial towns all over the country are dying. You’re on a hiding to nothing.

        • Draco T Bastard 3.1.1.5

          We need an OCR rise of 0.05% to prick the bubble that is forming..

          That failed to work on the last bubble. IN fact, IMO, it fuelled it as the high interest rates dragged in huge amounts of hot money – just like what’s happening now.

          • KJT 3.1.1.5.1

            And delivered a double whammy to our exporters of both a higher interest rate than overseas competitors and an overvalued dollar.

            One of the main reasons why our manufacturing sector is dying. The stupidity of the reserve bank act, 30 years past its use by date, clobbering the economy whenever it starts to get off the ground.

  4. AAMC 4

    Lots of talk of legal action about to be taken against Oz banks for sub prime lending, so as alway, the story will evolve. A small correction in asset prices when the bubble bursts and their all bankrupt rather than overly profitable because of their leverage. Fun times.

    • Colonial Viper 4.1

      They’ll very quickly have their hand out for a tax payer bail out. And if we refuse they will threaten to sink our economy. The bankster game is a well practiced art.

  5. PlanetOrphan 5

    Nice of the reserve bank to prop up foreign institutions with NZ money …
    I wonder how much is left after the decades of idiotic management of our economy.

    None would be my guess, that’s why DunnoKeyo is borrowing money from external economies ….

    That’ll help Aoteoroa aye M8!

    Bloody Gnats’

  6. muzza 6

    Didn’t take him long to slip right into the M.O of lying, then giving a pathetic excuse for doing so. The again what is expected of ex World Banker, who as been dropped into position, as the *independent governer*, of the *independent RBNZ*. Little more can be expected of the man who represents the powers which control NZ’s monetary system!

    Also, people need to stop thinking as the Ozzie banks as the owners of our banking system, they’re not. Look at where the ownership of the Ozzie banks rolls up to, and one will find the familiar territory..

    So when we talk about profits heading to OZ, in fact that is only the next level up!

  7. Funny, a Kiwi born US banker who made his mark in one of the most corrupt banking entities in the world opens his mouth and oh oops, he’s lying. Why am I not surprised?

  8. Colonial Viper 8

    Forget dropping the OCR to give relief to mortgage holders in NZ. Its bullshit as the banks only pass a portion of the rates cut along and keeps the rest as extra profit margin. No matter what happens, the banks win.

    Current example in Australia – central bank rates are cut 25bps but only 20bps saving is passed along to the consumer. The bank keeps the remaining as ADDITIONAL profit on top of what they are making now.

    http://www.theaustralian.com.au/business/financial-services/nab-passes-on-20bp-of-the-rbas-25bp-rate-cut/story-fn91wd6x-1226530291662

    Fucking banksters. Now with the new RB Governor it looks like we have a bankster wolf guarding the hen house. This is going to turn out well for our country.

  9. QoT 9

    For posterity, here’s a link to the Stuff article on it (because we bloggers are not to be trusted.)

    Beyond that, all I have to say is “WTF?” and “When you don’t know the answer, and you make up an answer instead of admitting you don’t know, that’s kinda the definition of a lie, Graeme.”

  10. Dv 10

    AND the banks pass on decreases in rates slower than rises over the last 20 years.

  11. Karl Sinclair 11

    Banks = Establishment Preservation = Persevering the Status Quo MonKEYs

    1. Establish a sophisticated surveillance system (The Panopticon or SIS = JKeys Fluffers)
    2. Ensure the voting public are uninformed
    3. Eliminate Logical/Critical Thought (education that is supposedly one of the best in the world that is only dedicated working not thinking….)
    4. Support belief systems that support passive obedience (framing thought)
    5. Establish Herd Psychology – Establish a deep fear of social rejection & associate that fear with culturally taboo subjects (oh like your odd if you belong to a union or are interested in politics and want to question who thes banking xxxxes really are and and and and… how are those all blacks doing again?)

    Culture in Decline | Episode #1 “What Democracy?” by Peter Joseph http://www.youtube.com/watch?v=bTbLslkIR2k

    • muzza 11.1

      Thats right Karl, humanity is busily being distracted while it ties the knot for the noose that its putting around its own neck, and its partners, and its childrens!

      Ka mate

  12. RedBaron 12

    Push the NRWT rate through the roof. That’s non resident withholding tax rate and make sure it’s covering a wide enough field to make hot money hurt! Take out any cut out’s i.e putting investments in a company and taking the dividend off shore.

  13. jamie prentice 13

    Its pretty simple to solve really, all profits bank make must stay in the country and invested in our country. Who runs this country?

    Then you will here the pigs squealling. Whos country is this? Ours or the banks?  

Recent Comments

Recent Posts

  • Minister makes meagre effort to fix big problem
    Today’s announcement by Health Minister Jonathan Coleman that Budget 2015 will include $98 million for elective surgery over three to four years should be seen for what it is – a drop in the bucket in an effort to appease… ...
    14 hours ago
  • Treasury forecasts a deficit for next year too
    National has tried to get the bad deficit news out of the way before this year's Budget but Treasury’s warned next year’s books could also be in the red despite Bill English's panicked spending cuts late last year, Labour’s Finance… ...
    16 hours ago
  • OIA chaos in the Ministry of Social Development
    So it turns out yesterday’s story about WINZ cuts to dental care loans was wrong, and through no fault of Radio New Zealand who ran it. The Ministry of Social Development (MSD) has today corrected the Official Information Act release… ...
    GreensBy Jan Logie MP
    18 hours ago
  • First state house sell-off will achieve little
    The first tranche of the Government’s state house sell-off will do nothing to fix the housing crisis or better the lives of vulnerable families, Labour’s Housing spokesperson Phil Twyford says. The Government has just announced the transfer of 1600 state… ...
    18 hours ago
  • Job figures show many missing out
    New Zealand’s “rock star” economy is failing to deliver either a surplus, real wage increases or job growth with unemployment stuck at 5.8 per cent,” Labour’s Leader Andrew Little says. “The Government trumpets the 3 per cent growth rate and… ...
    19 hours ago
  • Secret moves could undermine education system
    The Government must explain why it is pushing to open doors to multinational private education providers through a controversial international free trade agreement, Labour’s Education spokesperson Chris Hipkins says. “Documents leaked today show our Government is one of a handful… ...
    20 hours ago
  • Spotless must now end all zero-hours contracts
    New Zealand’s largest contractor of food, cleaning and hospital staff, Spotless, must now take action to end all zero-hour contracts, Opposition leader Andrew Little says. “Yesterday Labour asked questions of Parliamentary Service and the Speaker after we revealed nine parliamentary… ...
    23 hours ago
  • Are we even talking about welfare anymore?
    I’ve worked with children in the slums in India and that experience confirmed my sense of luck that I live in a small, naturally abundant country, which many years ago made the decision to share those resources so everyone had… ...
    GreensBy Jan Logie MP
    1 day ago
  • MPs warned off celebrations for fear of upsetting Chinese
    A leaked email that reveals the Government is warning MPs not to attend Falun Gong celebrations and that China will be spying on people who do has no place in a free society, Labour’s Foreign Affairs spokesperson David Shearer says.Advice… ...
    2 days ago
  • Labour stands behind Solid Energy miners
    Solid Energy miners will not be surprised at the company’s announcement today of further restructuring but any more job losses will be a shock for West Coast communities, Labour’s MP for West Coast-Tasman Damien O’Connor says. “I have my fingers… ...
    2 days ago
  • TPK unable to deliver on Whanau Ora
    The Auditor General’s report on Whanau Ora highlights what many people knew – Te Puni Kokiri was never designed to be a service delivery agency, said Labour’s Maori Development Spokesperson Nanaia Mahuta and Whānau Ora spokesperson Adrian Rurawhe. “In the… ...
    2 days ago
  • Too many Kiwis waiting on waiting lists
    Waiting lists to get on waiting lists are the new norm for thousands of New Zealanders living with chronic health problems, Labour’s Health spokesperson Annette King says. “The Government’s underfunding of the health sector is forcing district health boards to… ...
    2 days ago
  • Delays in spending damage Whanau Ora
    Criticism from the Auditor General that a greater proportion of Whanau Ora funds could have been directed to families rather than administration is something that needs to be investigated thoroughly, says Social Development Spokesperson Carmel Sepuloni.  “To quote the report… ...
    2 days ago
  • Walking the talk on sexual violence
    Te Tai Tokerau MP Kelvin Davis is putting election campaign promises into action, organising a hīkoi to raise awareness around sexual violence. The 17-day MASSIVE (Men Against Sexual Violence) walk – from the electorate’s southern boundary to the northern tip… ...
    2 days ago
  • Govt dumps infrastructure costs on Akld ratepayers
    The Government’s failure to invest in infrastructure to service its Special Housing Areas is dumping massive costs on Auckland ratepayers, Labour’s Housing spokesperson Phil Twyford says. Auckland Council has declined to approve three new Special Housing Areas on the city… ...
    2 days ago
  • Labour reforms encourage bad employers to be bullies
    The Government’s changes to labour laws have created a climate that allows bad employers to bully their workers, Labour’s spokesperson for Labour Issues Iain Lees-Galloway says. “Tauranga worker Bertie Ratu was threatened by her employer Talley’s for asking her local… ...
    2 days ago
  • Parliament workers on zero-hour contracts
    The Government must take urgent action and insist the contractor who employs workers at Parliament on zero-hour contracts end these unfair work arrangements, Labour Leader Andrew Little says. “Speaker David Carter has confirmed in his reply to questions from Labour… ...
    2 days ago
  • RMA: We need to know
    Environment Minister Nick Smith needs to spell out to New Zealanders what they can expect from his substantial reform of the RMA, says Labour’s Environment spokesperson Megan Woods.  In an open letter to the Minister, Megan Woods has urged him… ...
    2 days ago
  • He Aituā! He Aituā!
    “Papā te whatitiri! Hikohiko te uira! Ka wāwāhia ki runga o Hikurangi maunga, o Waiwhetū kainga. “Kua katohia e te ringa kaha o Aituā i tetahi pou whakarae o te reo Māori. Nō reira kei hea taku manu tui… ...
    3 days ago
  • Stratoil – Iwis do what National will not
    Tomorrow, Far North tribal representatives for the Te Hiku o Te Ika tribes will be travelling to the head office of Statoil to discuss the opposition to its oil exploration program in Te Reinga Basin. Statoil have decided to begin… ...
    GreensBy Gareth Hughes MP
    3 days ago
  • Mana whenua head North to oppose oil drilling
    It was good to hear the news that a mana whenua delegation is heading north, a long way north, to make their views known about the proposed  oil drilling off the Northland coast. The roopu will be representing iwi and hapu… ...
    GreensBy David Clendon MP
    3 days ago
  • Ministers must act on 111 failure
    Lives are being put at risk if the company contracted to manage emergency 111 calls can’t cope with increased numbers, Labour’s ICT spokesperson Clare Curran says. “Saturday’s situation where people calling the emergency services were unable to get through and were… ...
    3 days ago
  • People trying to save lives don’t deserve abuse
    WorkSafe New Zealand staff trying to save lives on farms shouldn’t be subjected to a tirade of verbal abuse from a Member of Parliament, Labour’s spokesperson for Labour Issues Iain Lees-Galloway says. “Chester Borrows has labelled WorkSafe New Zealand officials… ...
    3 days ago
  • Action on laws needed in Privacy Week
    The Government must speed up promised law changes to reassure the public their private information is in safe hands as the country marks Privacy Week, Labour’s associate Justice spokesperson Clare Curran said today. “The previous Justice Minister Judith Collins announced… ...
    3 days ago
  • Māori Caucus call on iwi leaders support
    Labour’s Māori caucus has sent an open letter to iwi leaders around the country seeking their support for meat workers currently in employment negotiations with Talleys.  “We are aware that when Talleys locked out workers for a period of 89… ...
    3 days ago
  • National still splashing cash on charter school experiment
    New figures confirming that charter schools are still being funded at up to four times the rate of their state school counterparts shows just how desperate the National Government is to make its experiment a success, Labour’s Education spokesperson Chris… ...
    5 days ago
  • Regions pay price for inaction on housing
    New figures put the cost of an average Auckland home at $800,000 and show large parts of the country facing stagnant or falling property values, Labour’s Housing spokesperson Phil Twyford says. “The QV data released today shows residential property values… ...
    6 days ago
  • Regions pay price for inaction on housing
    New figures put the cost of an average Auckland home at $800,000 and show large parts of the country facing stagnant or falling property values, Labour’s Housing spokesperson Phil Twyford says. “The QV data released today shows residential property values… ...
    6 days ago
  • PPP schools not at expense of community groups
    The Government must guarantee community groups will not be the losers out of its signing of a $298 million deal for four more public private partnership (PPP) schools, Labour’s Education spokesperson Chris Hipkins says. “Community groups will find it more… ...
    6 days ago
  • Surplus: The biggest broken promise ever
    Bill English has failed to deliver on his double-election campaign promise of a surplus by this year, instead delivering seven deficits out of seven budgets, says Labour’s Finance Spokesperson Grant Robertson. “The Government spent seven years and two election campaigns… ...
    6 days ago
  • McDonald’s serves up some McHappiness
    Unite Union and McDonald’s have given New Zealand a perfect way to celebrate May Day by reaching a settlement that strikes another blow against zero-hour contracts, Labour spokesperson for Labour Issues Iain Lees-Galloway says. “Earlier this week it looked like… ...
    6 days ago
  • Justice delayed and delayed and delayed
    Today we found out that the case of the prominent New Zealander  charged with indecent assault will retain name suppression until the case goes to court in about a year. Putting aside the appropriateness or not of granting name suppression,… ...
    GreensBy Jan Logie MP
    6 days ago
  • No golden age for books
    The ‘indefinite’ postponement of an initiative designed to encourage people to read Kiwi books will be a major blow to local authors, publishers and booksellers, Labour’s Arts, Culture and Heritage spokesperson Jacinda Ardern says.News that the annual NZ Book Month… ...
    7 days ago
  • Cracks showing in economy of milk and houses
    Fonterra’s latest cut to its forecast farmgate payout confirms that an economic black hole of $7 billion is opening up that will seriously affect the regions, says Labour’s Finance spokesperson Grant Robertson. “The cut confirms the long term trend of… ...
    7 days ago
  • Human Rights – An Issue for Everyone
    This week, the issue of human rights has been everywhere in the news. We have seen John Key prioritise a free trade agreement with Saudi Arabia over all else with no guarantee of human rights clauses being included. We have… ...
    GreensBy Catherine Delahunty MP
    7 days ago
  • Govt inaction on housing keeping rates high
    The Government’s failure to rein in the housing crisis means the Reserve Bank Governor cannot lower interest rates despite inflation being at 15-year lows, says Labour’s Finance spokesperson Grant Robertson. “Inflation is below the target band and the economy has… ...
    7 days ago
  • What do our refugee policies say about us?
    It is my pleasure to share with you a blog from Hester Moore who is currently interning with the United Nations High Commission on Refugees in Cairo, after graduating from the Univeristy of Canterbury. Sometimes, as a nation it is… ...
    GreensBy Denise Roche MP
    7 days ago
  • Tamaki state housing transfer risky and desperate
    The Government’s transfer of 2800 state houses to the Tamaki Redevelopment Company -- to be announced at 9am today -- shows it's desperation to off-load state houses and show some kind of action against Auckland's out of control housing crisis,… ...
    7 days ago
  • Tamaki state housing transfer risky and desperate
    The Government’s transfer of 2800 state houses to the Tamaki Redevelopment Company -- to be announced at 9am today -- shows it's desperation to off-load state houses and show some kind of action against Auckland's out of control housing crisis,… ...
    7 days ago
  • Woodhouse should close work visa loophole
    The Immigration Minister must revoke the work visas of temporary Chinese engineers working on KiwiRail trains and close the loophole that allows their employers to avoid New Zealand employment laws, says Labour’s spokesperson for Labour Issues, Iain Lees-Galloway. “New Zealanders… ...
    1 week ago
  • Job losses show folly of Chorus’ copper cuts
    Chorus and the Government are neglecting the copper broadband network, leading to 145 potential job losses at Transfield Services as well as poor services in the regions, says Labour’s Broadcasting Spokesperson Clare Curran. “Steven Joyce and Amy Adams have made… ...
    1 week ago
  • National quietly ditches its surplus promise
    National has quietly dropped its long-promised return to surplus by this year by removing the date it will get the books back in the black from its online campaign material, says Labour’s Finance Spokesperson Grant Robertson. “National’s pledge to reach… ...
    1 week ago
  • Even cheap houses now unaffordable
    New housing affordability data show that now even the cheapest houses in Auckland are unaffordable for first home buyers, says Labour’s housing spokesperson Phil Twyford.  “The AMP360 Home Loan Affordability Report reveals Auckland's lower quartile house price has leapt to… ...
    1 week ago
  • Key’s careless chatter tips off Arabic media
    John Key has shown a frightening lack of judgement in disclosing to an Arabic media outlet that Kiwi troops are in the UAE awaiting deployment to Iraq, Labour’s Foreign Affairs spokesperson David Shearer says. “At the same time the Prime… ...
    1 week ago
  • Child poverty will not be solved by vouchers
    New Zealand has debilitating levels of child poverty, entrenched violence against women and children, and the ongoing effects of colonisation on Maori are brutalising communities. When we dwell on the statistics – which mostly we don’t because it all seems… ...
    GreensBy Jan Logie MP
    1 week ago
  • Simon Bridges spent over $6500 on Northland
    Transport Minister Simon Bridges spent over $6519 on travel and flights to Northland for the by-election – spending around $1000 a week, Labour’s Acting Leader Annette King says. “Simon Bridges’ desperate dashes to Northland got him in political hot water.… ...
    1 week ago
  • Firing squad deaths deplorable
    The execution of eight men by an Indonesian firing squad is deplorable, Labour’s Foreign Affairs spokesperson David Shearer says. “New Zealanders do not support the use of the death penalty under any circumstances. ...
    1 week ago
  • Aged care workers need more than talk
    Yesterday AUT released the New Zealand Aged Care Workforce Survey 2014. The conditions of aged care workers are important for many reasons. We have an ageing population and people are going into care/requiring care later than before, so it’s critically… ...
    GreensBy Jan Logie MP
    1 week ago
  • Aged care needs urgent attention
    The Government must stop neglecting older New Zealanders and the people who care for them and give urgent attention to a sector that is in dire straits, says Labour’s Associate Health Spokesperson Iain Lees-Galloway. “The lead author of the New… ...
    1 week ago
  • Passing the buck a disaster in the making
    Moves to overhaul the social services sector are nothing more than privatisation in drag and are a potential disaster in the making, Labour’s Social Development spokesperson Carmel Sepuloni says. “A report from the Productivity Commission supports the Government’s push for… ...
    1 week ago

Public service advertisements by The Standard

Current CO2 level in the atmosphere