The Reserve Bank Reform Bill

11 comments on “The Reserve Bank Reform Bill ”

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1. Antoine 1

   7 December 2018 at 7:32 am

   I agree with much of what you say, but it is a nonsense to say that electricity lines are cartel-like and face ‘barely any price regulation’. Most lines companies are under heavy price regulation. They have to be, as there is not competition in the sector. Not comparable with the other items in your list.

   A.
   • KJT 1.1

     9 December 2018 at 6:02 am

     One of the hidden costs of privatization. The cost of regulations, monitoring and controls, to ensure one eyed profit centred private companies do not plunder the public and run down the infrastructure.
     Underlines the stupidity, of the whole privatisation of the power companies. Not to mention privatising control of banking.
2. Phil 2

   7 December 2018 at 9:13 am

   Your entire post is woefully under-informed. The ‘anodyne’ changes you note represent only Phase One (specifically focusing on how monetary policy and inflation targeting are implemented) of a huge review of the RBNZ.

   There is a consultation paper out in the public arena right now focusing on how the RB deals with regulation and supervision of banks.

   https://treasury.govt.nz/news-and-events/reviews-consultation/reviewing-reserve-bank-act/public-consultation
3. Blazer 3

   7 December 2018 at 9:22 am

   Reform of the banking sector is well overdue.
   They have proved time and again that they cannot be trusted.

   Still cannot understand why more NZ’ers do not embrace Kiwi Bank.
   The present ANZ chairman in his former role did his best to sideline it.

   Since the repeal of Glass Steagal the Wall St banks have dominated politics ,with disasterous results ,culminating in the GFC and ludicrous inequality and an international debt money go round that can never be repayed.

   I love the way ,most peoples biggest financial burden,i.e rent or mortgage is excluded from inflation figures.

   The Reserve Bank needs more teeth and to tear the cosy banking cartels to…shreds.
   • Antoine 3.1

     7 December 2018 at 10:14 am

     Can you please not tear my bank into shreds as i am still using it

     A.
   • WILD KATIPO 3.2

     7 December 2018 at 10:57 am

     Good comments and good article by Advantage. And while some parts may seem to some to be broad brush strokes, that is only because space would not permit. This govt at least is recognizing that the whole ‘deregulation thing’ is feeding overseas fat wallets and bleeding us and our govt coffers dry… so to speak.
4. Draco T Bastard 4

   7 December 2018 at 12:01 pm

   Specifically for the part that monetary policy is expected to play, the Government “expects monetary policy to be directed at achieving and maintaining stability in the general level of prices over the medium term and supporting maximum stable employment.”

   Then they’re doing it wrong as evidenced by the GFC and other recessions over the years.

   The problem is two fold:
   1. The private bank’s creation of money which massively pushes up inflation especially in housing
   2. The hot flow of money across borders which can cause recessions when rich people, acting as a herd, remove all the money that they can get their hands on from an economy

   Both of these need to be addressed. The first one by banning the private banks from creating money and the second by banning foreign ownership and sales of NZ goods in foreign currency.

   Earlier this year the IMF carried out a comprehensive review of New Zealand’s financial system against international standards, with a focus on the quality of financial sector regulation.

   So, what did they say?

   It is bizarre that our Reserve Bank Governor should think – particularly after the recent Panama Papers revelations – that the most useful thing is to design a system of banking regulation that fits New Zealand conditions. What it needs to do is protect us from the shits that run the money in this world. To do that is needs big, sharp regulatory teeth. And it doesn’t want them.

   Not bizarre at all when it’s obviously a Priest of the Church of Deregulation who’s in charge of the RBNZ. It doesn’t help that the government are worshippers at the same church.

   So at least there’s one government politician who gets this. It’s not as if we need another GFC to remind us of what a “self-regulating” banking sector does to a society when its’ profits are threatened. It sucks us dry.

   The banking sector sucks us dry. It’s actually designed to do that which is why it charges interest.

   The fix is a state banking system that makes both business and mortgages available at 0% interest. The money is created by the RBNZ (Reserve currency) as needed to make those loans. The funding to run this banking system would be from taxes but it is not a subsidy as everyone needs and uses those services.

   Banking is but one of a series of oligopolies exercising cartel-like behaviour over this country that are sucking us to a husk. These near-cartels include:

   … and other goods and services with barely any price regulation that we totally rely on for our very lives as well as a functioning society.

   Essential services which have a demand monopoly should always be provided by government and not the private sector.

   That list above contains a multitude of regulatory nightmares, affecting millions of New Zealanders, and this government will face a couple of terms just getting to grips with any of them.

   I’m pretty sure that they won’t even look at them as the still believe the lie that the private sector does it best despite all the evidence proving otherwise.

   And if this government doesn’t understand after the debacle it is facing in NZTA of “self-regulation” in the car and truck industry, it is only a matter of time before we get yet another avoidable disaster in any of them, including banking.

   QFT
5. CHCOff 5

   7 December 2018 at 2:19 pm

   A House is a Home, the common market of and by all NZ citizens of all classes.

   Those the type of feathers which would give the most benefit being ruffled.

   Why put further resources into the outer shells of speculation and money laundering? Better to have an approach where such things naturally atrophy and die.

   Decoupling, not regulating.
6. Tuppence Shrewsbury 6

   7 December 2018 at 3:33 pm

   FInd it a bit strange that a government that wants to reform electoral law that blatantly favours it’s support parties should “just be allowed as it’s 30 years since muldoon” to reform one of the sanest, safest and most bipartisan pieces of legislation ever enacted in New Zealand.

   But ok, nothing bad could happen here.
   • KJT 6.1

     7 December 2018 at 9:20 pm

     What fantasy world do you live in. The RBA, has been one of the most destructive legacies of the 84 and 90’s Governments.

     http://kjt-kt.blogspot.com/2013/05/the-reserve-bank-debt-and-property.html

     “In New Zealand we have the “Reserve Bank Act”.

     Which basically requires the reserve bank to kill the rest of the economy, whenever Auckland house prices, or wages, rise.

     Originally enacted, as a circuit breaker, to cap excessive inflation in the 80’s, politicians have kept it, long past its use by date, because in their limited view, what works once, briefly, will work perpetually.
     It could be argued that it was somewhat successful in curbing very high inflation, on that limited occasion, though others would note that the end of very high inflation ended with the slowing of the rise in oil prices.

     Now, every time the New Zealand productive economy struggles off its knees, the reserve bank delivers another knockout.”
7. Philj 7

   8 December 2018 at 7:36 pm

   There is an alternate narrative to the MSM banking one, almost the opposite to what you have been told.
   In summary, the mainstream Bank/financial system is the problem. You decide.
   Michael Hudson is well qualified to critique the fraud that we are in. Happy thinking!

   https://youtu.be/k6y35aO_fpU

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