Competent economic management

Written By: - Date published: 9:18 am, February 4th, 2011 - 20 comments
Categories: Economy - Tags:

John Key Oct 2010: “I don’t think we should argue we are in a recession … now that summer has come, economic activity is starting to pick up.”
Building consents lowest on record * unemployment hits 6.8% * retail spending falls * We’ve had double dip recession

PS. For what it’s worth, I think we might just avoid recession in december, only because it would be hard for the economy to shrink again relative to the disastrous september quarter. I’m picking 0.1% growth, still down on a per capita basis.

20 comments on “Competent economic management”

  1. prism 1

    Phil Goff sparring with RadioNZ Kathryn Ryan at present. Getting a thorough going about Labour and what useful ideas it has for the economy. Is talking about Parekura Horomia being likely to step down and the need to bring Shane Jones forward to replace him when that happens.

    About the economy and who is judging it – I think before he said that two weeks before the Fanny Mae etc debacle, the ratings agency gave them tripleA health rating

    • Tel 1.1

      It’ a pity Kathryn could not have pressed Key last week in a similar manner to the constant interruption run around she just gave Phil.

      By comparison her interview with Key last week was akin to 30 minutes of dead air. Perhaps because Key won’t front for media, the line of questioning becomes diluted by multiple topics, none of which ever get fully answered or followed up on, and dare I say it, not researched. Key hauled out the old chestnut tactic from the last election and accused her of carping, to throw her off the line of questioning at one point, showing he has no respect for her (and women in general?) or anyone else that might want to hear an answer.

      Listening to her not follow up on bogus recounts from Key on things like the Hobbit debacle and for him to roll out his standard justification for doing anything… “in my view (insert assertion here)” like it might be worth something other than suspicion and disbelief.

      The media in this country is fucking disgrace.

  2. Treetop 2

    The only bright bit of news on the horizon is the world rugby cup and this is happening due to the last Labour government.

    • lprent 2.1

      Who cares?

      I’m only interested in sport if I’m playing, and I’m long past the age for that type of team sports (used to play rugby, league, and cricket long ago). I’ve never really figured out why people want to go off and watch other people playing. It is quite mindless and unproductive.

      Actually now I think about it – I do care. We live too close to town and Eden Park. It looks increasingly like a total cluster fuckup for us for months.

      Lyn and I have discussed it and are thinking that RWC time would be a good time to either:

      1. disappear off on holiday for a while.
      2. move before the RWC to somewhere in the city where we don’t get this type of imposition of mass importation of idiots into our lives.

      I wonder how much of the economic activity of the RWC will be from people like me trying to avoid the damn thing.

      • Draco T Bastard 2.1.1

        I’ve never really figured out why people want to go off and watch other people playing. It is quite mindless and unproductive.


        Glad I don’t live in the shadow of Mt Eden any more. The traffic, noise and light was bad enough just on a normal game – the RWC would make the place unliveable for weeks.

      • Treetop 2.1.2

        I loved the atmosphere of Athletic Park (lived minutes walk away when a kid). What has changed?

        • Lanthanide

          I’m sure the atmosphere is great if you’re a kid and you don’t have to deal with traffic or idiots clogging the place up.

      • Lanthanide 2.1.3

        There was a story on TV early last year about people who are doing house-swaps with others from overseas, or renting their inner-city houses out to tourists and moving elsewhere in the country during the event.

        You could consider that.

      • M 2.1.4

        ‘I’m only interested in sport if I’m playing, and I’m long past the age for that type of team sports (used to play rugby, league, and cricket long ago). I’ve never really figured out why people want to go off and watch other people playing. It is quite mindless and unproductive.’

        Careful you may get lynched, but yes I agree – the only time I go watch sport is if my youngest is involved and then usually do something like go on a committee until I’ve had enough of the heavy lifting for the other parents who never do anything.

        Option 1 looks good if you can swing it.

        • Carol

          I like watching team sports on TV sometimes, especially rugby & netball. But I’m not into all the glorifying of players and coaches etc, and the pre- & after match TV celebrity coverage.

          I was thinking the RWC will be exciting. However, I’m already going off it with JK using the photo ops as a campaign platform, diverting attention from his nasty NAct agenda, while the country goes down the toilet. If he’s gonna be popping up beside the ABs every 5 minutes, I don’t think I’ll watch…. or maybe I’ll support another team/s, like Aussie or Samoa, and only watch their games.

        • lprent

          I’ve been expressing it for decades, including to my sports mad brother. I’m still here.

          The trick with option one is to manage to coincide my time between project with Lyns time between projects. Always tricky.

  3. Lanthanide 3

    The 0.4% drop was the number that they were reporting on Morning Report on Tuesday I believe. They mentioned several times again this morning that the 6.8% unemployment level shows that we’ve gone into recession, and in their interview with Grant Robertson they even said “with an economy in recession” in their framing of a question to him.

  4. Deadly_NZ 4

    And of course there was this little gem from the Smiley wavey one.

    Don’t lose confidence??? I think we are way past that point now,

    I have also noticed that occasionally the MS is now starting to report the correct GDP figures for a change. not many but the odd story sneaks out.

    • prism 4.1

      Gosh I wish that all we needed our confidence for was for walking across a burning firebed. I understand that in the firewalk you get ‘keyed’ up and then just concentrate your mind on your desired outcome and move quickly ahead and the injury is minimal. We could keep confident and continue as Mr Key suggests if we had reasonable expectations of successful outcomes for us all. But I fear that we’ll get our fingers and our feet burnt with this bunch of raucous roosters.

  5. vto 5

    Lowest building consent numbers since 1965.

    That is such an eye-opener of a statistic that it seems to have gone right over everyone’s heads.

    Don’t see any looming improvement anywhere whatsoever either (except earthquake rebuild).

    • Rob 5.1

      vto, you need to understand that those of us employed in the industry that monitor NZ stats reports on residential and non residential activity as part of general company reporting have seen activity diminish every month since the begining of 2007. Last year alone 3,000 construction related businesses in NZ closed. The big issue is that construction is a massive employer of all sorts of people across a huge skill and service set.

      The reality of this is that for the last 3 and a half years we have seen market contraction in the NZ building industry of 11% – 16% per year. I am pleased to say that we have maintained most of our work force and held back on off shoring some basic fabricated parts. We have done done this through a very flexible employed labour policy. Our major shareholders and board have been more than understanding and have taken a long term approach to our position.

  6. prism 6

    Farming and their fortunes affect us all. We have been advised to develop high-tech, advanced manufacturing but not enough yet, it’s still mainly the primary and secondary stuff for us.

    Listening to farmers news after 12.30pm on RadioNZ gives hope. I thought it was good news that there is an active sheep farmers group with or in Silver Fern that is offering three year contracts for mid-micron merino wool.
    They are planning integration with their markets, and I guess want to have supply, volume of product, depth of knowledge about the product and market and future prospects. So sheep farming will get a boost and we can look to see action beyond dairy.

    I think they said that contracts beyond a year have been rare, and I believe that many sheep farmers have played the market seeking the highest profit available for their product. Also I don’t think they have had commitment to their processor and so there’s been lack of co-operation and future planning, and inefficiency. Of course some workers have found recently that they have been laid off as feed availability and the extra fattening have meant delayed offerings of animals, so no work.

    • Colonial Viper 6.1

      We have been advised to develop high-tech, advanced manufacturing but not enough yet, it’s still mainly the primary and secondary stuff for us.

      Someone get that damn exchange rate back under US70c and you’ll see some phenomenal high tech export growth.

      $4.9B worth of high tech exports last year, and that’s with limited co-ordination and support from central agencies. Another problem is that Datacom and F&P alone make up about 40% of that figure.

      NZ can’t double the number of cows on a hectare of pasture without frakking the environment up big time, but we can double our high tech exports, should we get focussed on the goal.

      Nice thing too, wages paid in the high tech sector are high wages compared to just about everywhere else. Including farming.

  7. prism 7

    CV – Good info. I thought I needed to get some new info and seeing $4.9B for high tech exports is great. But the exchange rate – none of our pollies want to go against the doctrinaire economics that rules the princedom. I’m reading Terry Pratchett and his Discworld fantasylands strike a parallel with ours.

  8. BLiP 8

    From your link:

    Gibbs estimates the economy grew just 0.1 per cent in 2010. To recover the ground lost in the 2008-09 recession it needs to be growing much faster than its trend rate. “But we are not getting above-trend growth. We are not getting trend growth. We are not getting any growth.”

    He’s only another bloody economist and works for a bank so what would he know, but what is “trend growth”? Does it relate to sustained growth over a number of periods thus indicating a trend, or is it, as you mention, growth which is greater than what you call the “per capita basis”? Its like another language to me and I’m reluctant to make much more effort in learning it because, in doing so, one has to agree with the assumptions contained in the terms for it to make sense.

    Accordingly, there’s a lot I don’t understand. For example, this catch-cry about “productivity before wages”. Where I work we are all flat out, the 40-hour week disappeared years ago. For staff here to become even more productive there needs be some significant capital investment and additional employment. We have trucks coming and going all day, and many of them have to wait around because there are not enough fork lift drivers and only a few of the fork lifts can manage some of the weights involved. A pay rise would certainly help as well. I’ve noticed over the last few months some of the workers are feeling pretty pissed off about things and there has been an increase in “shrinkage” and maintenance costs as some staff become increasingly less diligent in looking after the gear they do have. As far as I’m concerned, we’re a shit load more productive than we were, say, a year ago – so, where’s the money, fuckers?

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