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Who needs $4.8 billion anyway

Written By: - Date published: 7:15 am, November 21st, 2014 - 106 comments
Categories: national, superannuation - Tags: , , ,

Recently I wrote a post on the Nats’ economic “genius” in our property market. Yesterday a report from the NZ Super Fund (Cullen fund) provided further evidence of their incompetence. The highlights:

Fund size: NZ$27.11 billion
Fund return: 1.47% during October
Total return of 9.92% p.a. since inception (after costs, before NZ tax) compared to Reference Portfolio return of 8.75% p.a.
Total return of 14.78% over last twelve months, compared to Reference Portfolio return of 12.65%

This provoked some discussion on Twitter. If National hadn’t stopped our contributions to the fund it would now be worth $15.2b more than it is currently. There would have been extra costs for higher levels of borrowing, but even so NZ would be $4.8 billion net better off.

Cutting the contributions was stupid, short term thinking from National, and many people said so at the time. (Interesting to read an old Keith Ng post demolishing Farrar on this.) National’s supposed competence on economic matters is pure fantasy. We could have used the $4.8 billion that they just chucked away.

106 comments on “Who needs $4.8 billion anyway”

  1. les 1

    Yes they’ve managed to sell themselves as the ‘safe pair of hands’,and sound,prudent managers of the economy.Their central policy ,’borrow and hope’,reminds one of the Muldoon debacle in finance.He had cultivated a public reputation as a financial wizard too.

    • David H 1.1

      That’s not a safe pair of Hands. $4.8 billion is a little more than Ooppss Butter fingers. but then again Blinglish and co make blue and white collar crims seem positively honest.

  2. Lanthanide 3

    “This provoked some discussion on Twitter. If National hadn’t stopped our contributions to the fund it would now be worth $15.2b more than it is currently. There would have been extra costs for higher levels of borrowing, but even so NZ would be $4.8 billion net better off.”

    If you assume that despite the extra borrowing, everything else would have remained exactly the same.

    But actually there’s a reasonable chance that our sovereign credit rating would have been downgraded (even more than it already was under National) if we’d borrowed an extra $10B just to invest it offshore. This in turn would have pushed interest rates up and could easily have swallowed the $4.8B in net value that you’re calculating.

    • r0b 3.1

      But actually there’s a reasonable chance that our sovereign credit rating would have been downgraded

      Chance is a fine thing, but what we know for sure is that we’re billions worse off right now because of decisions that the Nats were warned at the time would be a costly mistake. And the cost of this mistake will compound over time…

      • Rob 3.1.1

        A very naive view, essentially the post is stating that there is no penalty in higher interest charges resulting from downgraded credit ratings.

        • Pascals bookie 3.1.1.1

          But the chance of a down grade based on that extra borrowing is pretty slim. The Ng post’s comments goes over this pretty thoroughly.

          While there’s an arg the rating might have been affected, maybe, if the agencies were scaredy pants, it’s pretty thin gruel.

          Fact is some people were right, and others turned out to be wrong.

          • Rob 3.1.1.1.1

            So at the peak of the GFC, when many 1st world economies were turning toxic, do you really believe there would have been no chance of NZ credit rating being lowered if they had followed this extra debt path?

            • Tracey 3.1.1.1.1.1

              more extra debt than the extra debt it was incurring you mean

            • Colonial Rawshark 3.1.1.1.1.2

              do you really believe there would have been no chance of NZ credit rating being lowered if they had followed this extra debt path?

              You mean the credit rating issued by corporate agencies such as S&P and Moody’s? These very same firms who were totally corrupt, and labelled toxic assets as AAA grade investments, facilitating the GFC?

            • Pascals bookie 3.1.1.1.1.3

              Given the low level of debt the govt was carrying, and the size of this ‘extra debt’, yep.

              Stopping these payments was only a small part of the govt’s debt reduction plan, nowhere near the bulk of it.

              Ng explains it well here:

              http://publicaddress.net/system/cafe/onpoint-the-super-fund-shell-game/?p=113747#post113747

              and it’s worth scrolling through to see the rest of the comments too.

            • locus 3.1.1.1.1.4

              Borrowings to finance sound investment do not equate with borrowings and increased debt to pay off tax gifts to the already wealthy

              Credit rating agencies are not stupid and factor in the debit ledger as well as the credit ledger – NZ’s credit rating would not have been downgraded

              Is this really the best excuse you can come up with to defend the nats truly amazing financial ineptitude and derogation of responsibility in changing the direction that Michael Cullen had mapped for NZ’s superannuation fund?

        • greywarshark 3.1.1.2

          If our credit rating was downgraded, then our popular currency might not be so much in demand for playmoney while the big machines wait for the next investment heist to come along and multiply their millions. If the b…rs weren’t so keen on our candy, its price wouldn’t fluctuate so much, therefore costing us at home, extra insurance in hedge funds that we buy from the people who are playing with our money. I think this is the very rational way it works. It is rational because it works for the makers of money rather than the makers of tradeable goods, the Good NZs.

          Please give me a thumbs up if I’m right.

          And superannuation fund having funds payments put in abeyance. I understand that to return the expected result, the income has to be paid in regularly. Then it will compound on the rising trend line, if the economic predictions are correct.
          Stopping payments for a while is a mistake, even if you have to borrow overseas to maintain them. The fund is to be capital accreted, and must be continuous to ensure the model works well. Extra interest would be a say ‘temporary non-repetitive additional cost’.

          Is this a reasonable explanation of what is meant above?

      • Lanthanide 3.1.2

        You’re making assumptions about *what might have been* and stating them as facts. Pure and simple.

        I could also make assumptions about what might have been and state them as facts, just as you have done: if Labour had won the 2011 election, NZ would now be bankrupt.

        Surely you would reject this statement of mine; you should similarly reject your own on the same basis.

        Now, if your argument had more meat to it than a simple calculation, for example you tried to take into account other possibilities (say, what would the situation look like if the interest we paid went up by 0.2%?), you might have a point. Or, alternatively if you hadn’t stated this as *a fact* that we are $4.8B worse-off, then I wouldn’t mind that either.

        • Pascals bookie 3.1.2.1

          Go read the Keith Ng link, and the comments. Loads of assumptions are factored in.

    • Nic the NZer 3.2

      “But actually there’s a reasonable chance that our sovereign credit rating would have been downgraded (even more than it already was under National) if we’d borrowed an extra $10B just to invest it offshore. This in turn would have pushed interest rates up and could easily have swallowed the $4.8B in net value that you’re calculating.”

      Baa, ha, ha, ha, ha. The central bank is in control of the interest rates, NZ’s credit rating is irrelevant. Evidence? Japan had its sovereign credit ratings down graded due to large government debt, and its interest rates on government debt have been near zero for several decades now! Sovereign credit ratings are pretty much irrelevant.

      • Lanthanide 3.2.1

        Cherry-picking data points that really aren’t comparable isn’t the basis for a strong argument.

        Japan’s economy is the 3rd largest in the world. Surely you have heard the saying “Owe $1M to the bank, the bank owns you. Owe $1B to the bank, you own the bank”.

        NZ’s sovereign crediting rating matters, because we borrow money internationally and promise to pay it back, with a certain interest rate on top. If that interest rate goes up, we have to pay more. The central bank’s interest rate controls how much we pay for domestic borrowing; it doesn’t (directly) affect foreigners choosing to lend us money.

        Certainly the situation of the PIIGs didn’t completely pass you by during the GFC?

        • Nic the NZer 3.2.1.1

          ‘Japan’s economy is the 3rd largest in the world. Surely you have heard the saying “Owe $1M to the bank, the bank owns you. Owe $1B to the bank, you own the bank”.’

          I guess we should be borrowing more so we can own our own bank? Oh hang on, we already do ‘own the bank’ its called the RBNZ, and it does what the government tells it (with some limited independence) as does the BOJ.

          ‘NZ’s sovereign crediting rating matters, because we borrow money internationally’, hang on the NZ governments borrowing is almost exclusively in NZ$, how does that work? Also as I said, the RBNZ is in control of interest rates, including interest rates on NZ government debt (because its denominated in NZ$). Here is an informative discussion of this fact,
          http://fixingtheeconomists.wordpress.com/2014/08/15/does-the-central-banks-control-long-term-interest-rates-a-glance-at-operation-twist/

          ‘The central bank’s interest rate controls how much we pay for domestic borrowing; it doesn’t (directly) affect foreigners choosing to lend us money.’

          Almost correct, its not who is lending the money, its the currency they are lending! As I said almost all NZ government debt is in NZ$.

          ‘Certainly the situation of the PIIGs didn’t completely pass you by during the GFC?’

          Yes, good of you to bring that up. I should have mentioned that countries using the Euro are not the same as NZ. This is because they don’t control their currency issuing central bank (the ECB), this brings us back to the charge of

          ‘Cherry-picking data points that really aren’t comparable’

          which you are guilty of. This is not to say that the ECB can’t do things that the RBNZ can, just the PIIGs don’t easily get such co-operation. Did you hear about the Greek government bond panic BTW, notice the ECB has brought down the price on Greek government bonds, by intervention.

          • Lanthanide 3.2.1.1.1

            Foreign person A wants to buy something that NZ produces, say milk. NZ farmers (ultimately) only accept $NZ for their milk, because the government forces them to pay tax and requires tax be paid in $NZ. So a foreign person has to obtain $NZ in order to buy milk. They do this by giving us their foreign money in exchange for $NZ. The rate at which this happens is the “exchange rate” between the two currencies.

            Similarly, the NZ government borrows $NZ. It does this by taking $NZ off depositors and promising to return it at a future date with interest on top.

            If a foreigner thinks “5% extra money in 10 years time is good value, and that’s what the NZ government is currently offering to pay”, then they will exchange their foreign money for $NZ and then give it to the government. The government has to set the interest rate on what they’re paying at a level that is attractive to investors.

            If the reserve bank were to start arbitrarily printing money, then foreigners would not want to trade foreign cash for $NZ, or they would demand a lot more $NZ in return for their foreign cash, because each $1 NZ is now worth less than it used to be.

            In turn this means the government may have to start offering much greater interest returns on their bonds, in order to encourage foreigners to take the risk to invest with them. The is measured by the sovereign credit rating.

            Hence how printing money is bad for a country (suddenly foreigners won’t give us any money any more, or they’ll give us much less than they used to, and it makes it hard to buy oil, computers and other nice things we import) and how the sovereign credit rating matters to a country – the government has to pay higher interest to realise the same net borrowing amount, and if they start printing money to try and offset the higher interest, they’ll get into a vicious spiral where no-one wants to trade with us.

            • Colonial Rawshark 3.2.1.1.1.1

              The NZ govt needs to be net printing money, now, billions of dollars of it a year, probably up to 2% to 3% of GDP and then spending it into the bottom half of the local economy.

              Your concept of how the NZ Govt borrows is completely askew. Your concept of what makes the NZD valuable to foreign investors is also completely askew. We already offer higher sovereign interest rates than most other western powers on the planet, for low stable sovereign risk. It’s one reason why the NZD is in such high demand. We could do with dropping the value of the NZD another 10%.

              The commentator above who says that the NZ govt is completely in charge of interest rates through the RB is correct.

              Japan’s size as the 3rd biggest economy has nothing to do with them being able to print trillions of yen and monetizing debt. It has everything to do with their needs, however.

              • Lanthanide

                “Your concept of how the NZ Govt borrows is completely askew. Your concept of what makes the NZD valuable to foreign investors is also completely askew. ”

                Ok, sell me the ‘real version’ then. Then convey this in such a way that it’ll be acceptable to the voting public at large. Otherwise it’ll just be laughed at like the Green’s suggestion for filling up the EQC fund (effectively printing money today, but pretending it’s in the future via accounting tricks).

                • Colonial Rawshark

                  Lanth what are you afraid of? Are you surprised that ordinary voters (and ordinary MPs) have no concept of central banking monetary operations? These operations allow the Reserve Bank to set *whatever* interest rate it wants or needs on a day. 0%. 1%. 2%. 3%. 4%. 5%. 6%.

                  Currently the NZD is excessively valuable because it is a target for hoarding and financial speculation. Ideally the NZD would be valuable because of demand for NZ goods and services, instead of as an asset for financial speculation.

            • Nic the NZer 3.2.1.1.1.2

              Your thinking goes wrong here,

              ‘If a foreigner thinks “5% extra money in 10 years time is good value, and that’s what the NZ government is currently offering to pay”, then they will exchange their foreign money for $NZ and then give it to the government. The government has to set the interest rate on what they’re paying at a level that is attractive to investors.’

              If you are holding NZ$ which you don’t have anything more productive to do with them, you have two choices, lend them to the government at what ever is the going rate in a heavily central bank influenced market, or hold onto them (or trade them with somebody else who faces the same choice). So no the government doesn’t have to offer anything! The government has a captive market. I don’t think non-investment is likely here, but even if it happens so what?

              BTW, you seem to have confused exporters with importers, so I have assumed you are talking about importers to NZ who end up with an actual surplus of NZ$ to invest for the purposes of this discussion.

              To point out something quite similar to what you are describing you probably have a savings account and a current account at the bank. Its your choice to put the money in the savings account (and get higher interest) or leave it in the current account (probably paying nada). So the question is how successful are you at influencing the bank to pay more interest on your savings? Maybe you are using your ‘hard bargaining’ strategy of leaving all your savings in the current account! Hows that working out? Is the bank still telling you what the going rate is for savings!

              “suddenly foreigners won’t give us any money any more”, you realize that NZ$ come from NZ right? The NZ economy is self sufficient in NZ$.

              • Colonial Rawshark

                Lanth is afraid of a situation where the value of the NZ$ falls precipitously and we are unable to get our hands on the hard foreign currency required to import goods like pharmaceuticals, computers and other electronics/advanced materials.

                He hasn’t thought through why and how nations actually suffer currency collapses (almost always severe destruction of an economy’s ability to produce valuable goods and services is required eg from warfare).

                • Nic the NZer

                  Seems to have scared the bejesus out of him, he is no longer thinking straight.

                  As long as NZers still need to pay tax in NZ$ and NZ is still producing exports which people can’t easily get elsewhere there will always be a fairly large demand for NZ currency. Also the entire world is obsessed by export lead recovery ideas, most countries are desperate to sell us anything they can produce. NZ policy is making it as difficult as possible to take advantage of that.

                  Of course the exchange rate naturally tends to sort itself out, because if it falls it becomes cheaper for foreigners to buy from NZ and tends to reduce demand for imports (which become more expensive).

                  • Lanthanide

                    “and tends to reduce demand for imports (which become more expensive).”

                    Oh, is that all? Just reduced demand?

                    So, our quality of life wouldn’t be affected if petrol cost $3/litre? What about $4/litre? How productive would our economy be, and how many goods could we create to export, if farmers couldn’t buy the trucks and cars they needed, the IT sector had to pay 200%+ markups over previous prices for new hardware, pharmac had to make-do with 30% less drugs…?

                    Never mind, that’s just “reduced demand”.

                    • Nic the NZer

                      Remember that last time that the RBNZ intervened in the forex market. How did that work out, its suppose to be screwing up those exporters right? Note it did have a significant effect on petrol prices, it must stand out in your memory as a very significant and problematic event.

                      http://www.interest.co.nz/currencies/72207/finance-minister-welcomes-nz-fall-reducing-headwind-exporters-says-rbnz-will-be-hap

                      BTW, the RBNZ uses different transactions for forex, the deficit has much less of a direct or visible effect on the exchange rate. By and large the exchange rate will not be an issue, though the RBNZ might run higher interest rates to keep the currency value high. They appear to be doing that at present.

                    • Lanthanide

                      Weird. You’re comparing *selling* $521M of NZ$ in the normal forex economy, with *printing* $5B NZ$ outside the normal forex economy, as if the first has some sort of bearing on the latter?

                    • Nic the NZer

                      Where did the RBNZ get the 521M $NZ from, I wonder? As I said there is less impact on the forex markets from ‘printing’ anyway. You were worried about import prices in your comment, so I used an example where we can actually see the effects on import prices.

                    • Lanthanide

                      The Reserve Bank got the $521M from it’s currency reserves.

                      They have a whole section on their website about it: http://www.rbnz.govt.nz/markets_and_payment_operations/foreign_reserves/intervention/

                      4. Between 1988 and 1998, successive Ministers of Finance agreed that the Bank should hold a target intervention capacity of around NZD 4.5 billion. In 1998, it was agreed that the intervention capacity should be stated in foreign currency terms,…

                      5. The rationale for the shift to targeting the intervention capacity range in foreign currency terms was that any intervention in a crisis situation would involve the Bank acting as a supplier of foreign currency; hence it is the foreign currency amount that the Bank holds that is important. A crisis in this situation is one where there are no `market makers’ in the New Zealand dollar, and the Bank stands prepared to purchase New Zealand dollars using foreign currency reserves.

                      Note how it doesn’t say anything about printing money.

                    • Nic the NZer

                      Any intervention where the RBNZ has bought something (in this case foreign currency) its effectively printing. If it makes you feel any better we could ask if they can pull the deficit out of their foreign exchange reserves instead! Would that make any difference?

                      Its meaningless for the RBNZ to ‘hold’ NZ$ reserves as it operates the accounts in NZ$.

    • Saarbo 3.3

      @Lanthanide
      That’s rubbish, why wasn’t our credit rating affected by the $10b spent on unnecessary highways over the same period. $10b or 5% of gdp is relatively small.

      • Lanthanide 3.3.1

        @Saarbo – because the choice that National gave us is not between spend $10B on roads or spend $10B on borrowing for the superannuation fund.

        National was *always* going to spend $10B on roads. So the additional $10B borrowing for the superannuation fund would be on top.

        So we’re not talking $10B of ‘spending’, we’re talking $20B.

        Also, spending $10B on roads looks more fiscally responsible to foreigners than borrowing and investing $10B in offshore companies during the greatest recession since the 1930’s.

        • lprent 3.3.1.1

          But they didn’t borrow $10B did they? They borrowed $55B and still rising.

          So how does that look to overseas investors? Ummm funds flooding into the economy, an excessively high currency, and absolutely no problems turning over the extra borrowing.

          I would say that you were and are mistaken. Economics is a ‘relative’ artform rather than a absolutist one.

          • Lanthanide 3.3.1.1.1

            “I would say that you were and are mistaken. Economics is a ‘relative’ artform rather than a absolutist one.”

            Actually that’s the point I’m trying to make. Borrowing an extra $10B, to turn around an invest it at the height of a global financial retraction (which, at several points, was looking like a collapse) could easily have been the straw that broke the camels back re: our credit rating.

            But you are of course right, I should be comparing $65B of borrowing to $55B, not $10B to $20B.

            • locus 3.3.1.1.1.1

              maybe another point you’ve missed is that the projected borrowings for the Cullen fund were planned and transparent – the market already knew what was intended

              the surprise to the market was the way in which the nats decided to cut back on what was a successful and well accepted strategy to protect NZ from the inevitable future increases in superannuation

              • Lanthanide

                “the surprise to the market was the way in which the nats decided to cut back on what was a successful and well accepted strategy to protect NZ from the inevitable future increases in superannuation”

                The short-term money market couldn’t care less about NZ’s future superannuation situation. Especially during a global financial crisis. Similarly plans made for the future when everything was golden and rosey don’t count for much when everything’s falling down around you.

    • Tracey 3.4

      currency traders and brokers know that you have to consistently enter a market so your risk is spread across good bad and even times. tbe ONE thing our former banker brought to the job he ignored.

  3. les 4

    well $4.8 bil is about what the Natz realised from asset sales anyway.Doesn’t go far these days!

    • locus 4.1

      hmm 4.8 billion dollars doesn’t go far? do you understand compound interest?

      actually… do you understand the long term cost to the NZ taxpayer of selling off profitable national assets that have had far more than 4.8 billion invested in them over the years? Particularly when you consider that the money from NZ’s asset sales will not be invested wisely or used to pay down debt by the neolibs that are selling off our future

  4. Nic the NZer 5

    Sorry Rob, this is a absolute non-issue, the government gains no additional capacity to spend from an extra 4.8 billion in super investment profits. It also follows that it gains no additional capacity to spend from raising tax, it can always spend first and worry about tax later. Because the economy is largely demand constrained usually no higher tax rates are needed to compensate for additional spending. You should drop it, its a non-issue. This kind of thinking will lead you to pushing for the retirement age to be raised, which is both un-popular and a really destructive economic policy for all concerned.

    • r0b 5.1

      Sorry Rob, this is a absolute non-issue, the government gains no additional capacity to spend from an extra 4.8 billion in super investment profits.

      Not today’s government – that’s why the Nats don’t care. But future governments and citizens benefit, that’s the whole point of the fund. As I said – stupid short-term thinking. We need governments that are better than this.

      • Nic the NZer 5.1.1

        I believe I said, the government, its irrelevant who that is for the purpose of discussing this.

      • Lanthanide 5.1.2

        Nic seems to believe that all countries can print unlimited amounts of money at any moment they feel like and that doing this will have absolutely no negative repercussions at all. So his post at #5 is coming from this angle.

        • Nic the NZer 5.1.2.1

          Almost, it is likely to have some negative repercussions once the economy is running at or near full capacity (e.g with a very low unemployment rate, not seen for multiple decades). At that stage if the government wants to increase spending more (so as to create more public goods, rather than private goods) they should look at increasing taxes so as not to cause inflation, but until that point Lanthanide is basically correct in his characterization.

          • Lanthanide 5.1.2.1.1

            And yet funnily enough, printing money has never been nirvana for any country that has tried it (outside of the behemoth economies).

            • Colonial Rawshark 5.1.2.1.1.1

              Lanth, NZ needs to worry about its real physical economy: the real condition and status of its adults and its children, the creativity and innovation within its society, and the productivity and quality of its real productive infrastructure.

              But instead of these things you seem stuck in some BS paper accounting world where you are hoping to cleverly balance this against that, this against that via hopelessly hypothetical macro-economic models.

              Printing money is not supposed to be a “nirvana” but it will allow you to put into action heavily under-utilised resources and capabilities. Like 1/4 million unemployed and under-employed NZers.

              There is minimal difference between the NZ Govt borrowing $100 from China and then spending it into the NZ economy, and the NZ Govt issuing that $100 and then spending it into the NZ economy.

              • Lanthanide

                Wanting to be able to import oil, computers and other items we don’t make ourselves is being “stuck in some BS paper accounting world”? Curious.

                “There is minimal difference between the NZ Govt borrowing $100 from China and then spending it into the NZ economy, and the NZ Govt issuing that $100 and then spending it into the NZ economy.”

                Correct. There’s also minimal value to spending $100 into the economy.

                Now, if you’re talking about borrowing $5B from China, or printing $5B and spending it into the economy, then you’ll be materially affecting the exchange rate.

                • Colonial Rawshark

                  What’s your fear Lanth? Even if issuing $5B in new high quality spending over 1 year (approx 4% of GDP) were to affect our exchange rate, so what? You know the NZ dollar could go 10% lower and it would be a great boon to both our added value manufacturers as well as our commodity ag-hort sector.

                  The one thing that you do point to is that NZ must end its clean float forex regime and go to a managed float.

                  • Lanthanide

                    You’re assuming that if we printed $5B of money our exchange rate would drop by 10%.

                    It could drop by 50%, or more.

                    You’re assuming that the idea to print money is a good one, based on the assumption that only good things will happen if you do it. That’s a circular argument.

                    • Colonial Rawshark

                      You’re assuming that if we printed $5B of money our exchange rate would drop by 10%.

                      It could drop by 50%, or more.

                      Hey mate, I think your fears of a 50% drop are incredibly overblown, but am happy to do the issue of $5,000M in 20 separate lots of $250M in order to manage the risk of unintended forex fluctuations.

                    • Lanthanide

                      Even announcing the plan would cause our dollar to drop – wouldn’t even have to follow through on it.

                      Also I don’t think printing $5B would result in a 50% drop in the currency, but the point is, it could. These financial markets are driven by fear, as well as control. Large economies can get away with doing ‘naughty’ things because no-one can stop them. But that’s not the same for a small trading economy on the arse-end of the world.

                      It may not be the $5B in printing itself that drives the dollar down, but the expectation that if the government is going to throw out the prevailing models of economics and print such a large amount of money, that they can’t be trusted for what they’ll do next – it could be $25B next week, or nationalisation of all foreign land and companies, etc. It’s these fears that could drop the currency by 50%.

                • Draco T Bastard

                  Wanting to be able to import oil, computers and other items we don’t make ourselves is being “stuck in some BS paper accounting world”?

                  Having the government creating money won’t stop us from doing that. It would also mean that we wouldn’t have to import at all as we’d just use our resources here instead of selling them overseas at atrocious exchange rates (lots of our resources for minimal of theirs).

                  Now, if you’re talking about borrowing $5B from China, or printing $5B and spending it into the economy, then you’ll be materially affecting the exchange rate.

                  And?

                  • Lanthanide

                    NZ doesn’t produce enough oil domestically for it’s own use.

                    NZ doesn’t produce any x86 CPUs.

                    There are lots of things NZ doesn’t produce, and it will take years or decades to be able to do so, to the point that it doesn’t make sense when we can focus on the things that we do well and trade for those goods instead.

                    • Draco T Bastard

                      NZ doesn’t produce enough oil domestically for it’s own use.

                      Then I suggest we stop using oil.

                      NZ doesn’t produce any x86 CPUs.

                      Then we need to start producing them.

                      There are lots of things NZ doesn’t produce, and it will take years or decades to be able to do so, to the point that it doesn’t make sense when we can focus on the things that we do well and trade for those goods instead.

                      And that is a load of bollocks. People specialise, societies don’t. There are people in NZ quite capable of producing x86 CPUs. Specialisation of a society actually brings about the poor use of it’s human resources. In fact, those people capable of producing x86 CPUs would leave a society that specialises in producing farms.

                      We have the resources to produce everything we use here in NZ and doing so is cheaper, in real terms, than importing them. It’s cheaper because it uses less resources in the first place and we don’t get that massive loss through the rather nasty exchange rate that I mentioned above where we sell tonnes of our resources to get a few kilos of resources back.

                      Our monetary system produces uneconomic results.

                    • Lanthanide

                      “And that is a load of bollocks. People specialise, societies don’t. There are people in NZ quite capable of producing x86 CPUs.”

                      Name 10. Or, name a company in NZ that owns a $2B fab, employs the 2,000 or so (guessing) employees needed to run it?

                      Oh, and has a license that gives them access to the technical specifications for x86 chips. Note: only 3 of these licenses exist in the world.

                      Or, if that’s too far up the food chain for you, please tell me which company it is in NZ that manufactures silicon ingots. They’re worth about $1M each and would surely show up in our countries exports if we made even a handful of them each year (since we have no domestic electronics industry that would consume them).

                    • Draco T Bastard

                      Name 10. Or, name a company in NZ that owns a $2B fab, employs the 2,000 or so (guessing) employees needed to run it?

                      I said capable of doing it, not that they’re doing it. Please learn to fucken read.

                      That said:
                      http://www.rakon.com/corporate/about
                      http://www.elex.co.nz/
                      http://www.kamahi.com/about.php

                      Just because we’re not doing it doesn’t mean that we can’t. In fact, I’d say the fact that we aren’t is a failure of our economic system.

                      They’re worth about $1M each

                      IC Grade Monocrystalline Silicon Ingot:

                      FOB Price:
                      US $1 – 99 / Kilogram

                      They’re quite large but I doubt if they mass a 1000kg each never mind 10000 to a million kilos.

                    • Lanthanide

                      Good references, Draco.

                      Now one of those companies probably could design an x86 processor, but I doubt they’d be able to get the manufacturing volume (again, $2B for a state-of-the-art fab), or access to the patented technologies and personnel to make them anywhere near competitive with the CPUs made by Intel. When it comes to CPUs, there’s really 3 important factors: correctness, power usage and price. If your CPUs are the same price but half the speed of the competition, it means you’ll need twice as many (hence twice the price) to achieve the same performance, and thats before you factor in the rest of the computer system that must also be duplicated to house your additional CPUs.

                      So, maybe we could produce x86 CPUs, but it’s pretty much impossible that they’d ever be better than the competition, which means more expensive and less effective. Better to milk some cows efficiently and trade for some efficient CPUs.

                      As for the ingot price, it does look like you’re correct; the price I had for $1M was me extrapolating a comment on the price of a processed silicon wafer. Once a wafer has been processed it’s obviously worth more than a raw ingot.

                    • Colonial Rawshark

                      Forget about the x86 bullshit, just go straight to ARM.

                    • Draco T Bastard

                      So, maybe we could produce x86 CPUs, but it’s pretty much impossible that they’d ever be better than the competition, which means more expensive and less effective.

                      Good job AMD didn’t have you as an advisor because if they had they would never even have tried making a 486 compatible CPU and wouldn’t now be a multi-billion dollar global company despite their initial CPUs not being quite as good as Intel’s.

                    • Lanthanide

                      Thanks for making my point. AMD have been in this business for decades and they are still losing money hand-over-fist and their products still aren’t as good as intels. We’d be lucky to have anything that could compete with AMD CPUs inside a decade.

                    • Draco T Bastard

                      Looks like a profit to me. And considering the games that companies use so as to avoid paying tax I’d take the reports of a loss with a few grains of salt as well. They certainly wouldn’t still be around if they kept losing money.

                      And AMD’s CPUs are as good as Intel’s. In fact, I’m now regretting getting a Core i7 as AMD’s 8 core was better for what I’m using it for.

                      And, finally, it won’t take decades to start NZ doing it. All it took for the US to start was the US federal government to make the first fabrication plant in Silicon Valley. Same thing happened in Taiwan. Basically, if we want a successful economy then the government has to start leading rather than waiting around for private enterprise who are really only looking to clip the ticket.

                    • Lanthanide

                      You need to be more careful when reading reports like those.

                      So far this calendar year they’ve made a loss of $39M. If you include the 4th quarter profit from 2013 then they’ve made a profit of $50M, however that included $48M in one-off revenue from legal settlements, so really it’s only a $2M operating profit over that time period (on a total revenue of $5.86B, or a 0.3% profit margin.

                      Calendar year 2013 they made a loss of $83M.

                      At $39M in the red already so far this year, it seems unlikely they’ll be making a large profit.

                      “And, finally, it won’t take decades to start NZ doing it. All it took for the US to start was the US federal government to make the first fabrication plant in Silicon Valley. Same thing happened in Taiwan. ”

                      And what year what that fabrication plant set up in Silicon Valley? How much did it cost? What was the state of the art then? We’ve come a long way from there, CPUs are a lot more complicated now, and they have arrived where they are because of decades of research and development, which of course is proprietary and/or patented.

                      Surely if it was so easy to set up a CPU fab that could rival Intel and AMD, the Chinese government would have done it, or would be doing it? They easily have the resources, manpower and cash to do it if they chose, and clearly its in their long-term best interests not to rely on US companies for their processors.

                    • Draco T Bastard

                      Surely if it was so easy to set up a CPU fab that could rival Intel and AMD, the Chinese government would have done it, or would be doing it?

                      What makes you think they haven’t? In fact, I’m pretty sure that a lot of Intel CPUs say Made in Taiwan on them. Same with AMD.

                      We’ve come a long way from there, CPUs are a lot more complicated now, and they have arrived where they are because of decades of research and development, which of course is proprietary and/or patented.

                      And a lot of which is publicly available because it was funded by government. Hell, Photolithography, has been around for almost 200 years. I don’t think any patents apply any more. The basics of semiconductors has been publicly available since the 1960s as part of the conditions for public funding in the US.

                      There is nothing stopping us from producing a fab plant in NZ or doing our own research except some fucking idiots determined to believe that we can’t actually do anything.

                • Nic the NZer

                  “Correct. There’s also minimal value to spending $100 into the economy.

                  Now, if you’re talking about borrowing $5B from China, or printing $5B and spending it into the economy, then you’ll be materially affecting the exchange rate.”

                  Actually, what the Colonel was alluding to was, there is minimal difference between the NZ Govt borrowing $5B from China, or printing $5B and spending it into the economy. If the RBNZ is going to keep the OCR above zero, there is basically no difference in terms of how the accounting ends up. This is because the RBNZ must soak up excess reserves resulting from spending to stop the 90-day bill rate from falling, with deficit spending the treasury (DMO) does this before spending, with printing it would need to happen after by DMO or RBNZ. The accounts end up the same however via different order of steps.

                  So the question to you Mr Lanthanide is, show me the collapsing exchange rate to validate your BS theory that the exchange rate collapses when the government prints money!

  5. felix 6

    So in other words we could have kept control of our energy infrastructure and been no worse off.

    Key chose to lose returns by flogging productive strategic assets for a one-off cash injection rather than invest for ongoing returns.

    How did National get a rep for being good with money?

    • Draco T Bastard 6.1

      As far as I can make out, because they’ve been lying about being better at the economy for decades and people now believe the lie despite all the evidence proving that they are actually the worst economic managers.

      • Tracey 6.1.1

        and they lied and fiddled the books to pretend there will be a surplus. post election english is changing public tune. but no one cares…

        • RedLogix 6.1.1.1

          Oh they care alright Tracey. People quite like being lied to when it confirms their preconceived biases.

  6. Poission 7

    The NZ super fund, has paid 4.36 billion in tax receipts since inception,and in it last financial period paid 10% of the total company tax so it is self funding in some respects due to the positive feedback on its investment strategy.

    This is one of the peculiar outcomes of the SOE regime,where a number of organizations with natural monopolies spend a disproportionate amount of time trying to reduce their tax liability eg Transpower,rather then enhancing efficiencies in their business.

    https://www.nzsuperfund.co.nz/news-media/nz-super-fund-releases-its-201314-annual-report-cautions-stakeholders-expect-more-normal

  7. greywarshark 8

    Well it’s obvious how NACTs got the rep for being good with money. They know how to tap into it and drip it round for the benefit of their friends. That’s what money is for in their world.

  8. Not a PS Shark Sashimi 9

    Michael Cullen would be referred to Rome for Beatification and Canonisation….but for his one big sin:
    —————————————————————————————————————

    he accepted a Knighthood!

  9. paddy 10

    A whole lots of what ifs and maybes does not constitute a waste of money. As several have pointed out the cost of using the money in the Cullen fund could well have cost us billions. Higher interest rates would have hurt not just the government who needed to borrow but also every business and every mortgage owner. The post is too simplistic and reeks of National Always Bad. We can do better.

    • Nic the NZer 10.1

      Paddy, the RBNZ controls interest rates in NZ. They brought down mortgage and other borrowing rates after the GFC, as you may remember. They can also control rates on government debt, when they want to (as long as its denominated in NZ$). Its kind of what they do!

    • Lanthanide 10.2

      “The post is too simplistic and reeks of National Always Bad. We can do better.”

      Agreed.

  10. Ross 11

    These are both “aunty” arguments. As my dear old departed dad used to say, “If my aunty had balls she’d be my uncle”.

  11. paddy 12

    God I wish this post had never been put up. It’s an embarrassment to the Left.

    [lprent: You’d better explain why you think that. Otherwise I’m liable to think that

    1. you are a right wing concern troll (it is one of their favourite lines)
    2. You are attacking a author personally.

    The latter is a self-martyrdom offence. So I’m choosing to think that is what you wanted when you wrote the comment. You are auto-spammed until you provide an explanation to me. If you provide a good clear explanation I’ll limit your ban to two weeks. ]

  12. Mike 13

    What a fucking moron.

    I guess that’s why you are broke and crying like a little bitch when you think you can talk about investment funds movements with the benefit of hindsight.

    • Colonial Rawshark 13.1

      LOL. Now if you cast your small brain back in time just a couple of years, people did say very clearly at the time that it was short sighted and bad financial management to starve the Cullen Fund. And they were right.

      So own up and take responsibility dude. I thought your type was keen on being “accountable” for bad decisions.

      Well, here’s your chance.

    • Tracey 13.2

      How could anyone dispute your calm and logical refutation. Impeccable.

    • lprent 13.3

      Damn near everyone here at the time apart from some shortsighted dickheads who resemble you, pointed out that with the interest rates as they were it was cheaper to borrow to maintain the fund than it was to not. You will find posts full of that foresight.

      For that matter there are posts here from 2008 and 2009 pointing out that it was the height of fiscal irresponsibility for the National government to change the planned tax changes to favour the rich. Rather than circulate or invested in the economy it’d be sucked up in paying down debt.

      Of course that stupid fiscal hole that National voting shortsighted fuckwits like you created is just about to cause the 7th fiscal deficit by your startlingly incompetent government. I guess that accurately reflect you…. But that does take a special kind of stupidity.

      I guess you have the usual ‘right’ foresight of about 3.5 inches. And the syphilitic memory that goes with it.

  13. Colonial Rawshark 14

    The NZ Govt borrows billions every quarter and spends it into local circulation. We’d be better off simply to issue the money and spend it into circulation ourselves (particularly to build productive and socially important infrastructure) rather than running up mounds of accounting debt.

    • Draco T Bastard 14.1

      Agreed.

      The reason why that doesn’t happen though is because it would make the large amounts of cash built up by the rich worthless as they’d no longer be able to charge the government interest to loan it to them.

    • Lanthanide 14.2

      “We’d be better off simply to issue the money and spend it into circulation ourselves (particularly to build productive and socially important infrastructure) rather than running up mounds of accounting debt.”

      Sure, if it there were no consequences to do so.

      I would rather think that there would be some consequences of some kind. Do those consequences outweigh the benefits? That is unclear.

      • Draco T Bastard 14.2.1

        Sure, if it there were no consequences to do so.

        Well, there doesn’t appear to be any consequences of the banks creating money – except the over-excessive inflation in house prices.

        I would rather think that there would be some consequences of some kind.

        Not really. The government wouldn’t be buying houses but building them using newly resourced materials. They’d source the new materials buy printing money as well but that would be offset by the fact that the materials would be sold. And then the houses would be sold or, even better, rented out. Both the selling of the materials and the renting/selling of the houses would then decrease the money supply decreasing any possible inflation.

        Do those consequences outweigh the benefits? That is unclear.

        The benefits would far outweigh the consequences. We'd have good housing for everyone, jobs for everyone, infrastructure would be built and well maintained, etc, etc. The consequences would be, compared to now, probably less inflation in house prices and a great, dynamic society.

  14. greywarshark 15

    Bill English always manages to sound so positive. He must have been a trial to his parents, trying to find out what was going on.

    The economy is fine.
    “Businesses and consumers are confident about the future, there’s a lot of activity in the manufacturing and service sectors, and companies are employing more people and paying higher wages,” he said in a speech to an ASB business breakfast in Auckland today.
    http://www.scoop.co.nz/stories/PA1411/S00246/nz-performing-well-return-to-surplus-a-challenge.htm

  15. greywarshark 16

    Lanthanide
    I have been reading your refutation of the arguments put to you down the thread. And I think that you aren’t going to know any more at the end of it than at the beginning.

    Colonial Rawshark or Nic NZ could you comment on a concrete real matter. The Conservation Department can’t get enough staff to do its tasks in NZ. We have a lot of unemployed and hardly-employed here. If we asked the unemployed to apply for training, as a foot soldier for DOC doing un to semi-skilled work, to a good standard and with commitment, and looked at their work background, and then trained them, could we pay for it by just raising a debit on the government budget? Then there would be deployment and accommodation around the country of graduates of that training,

    Would it result in a rise in inflation? Would it affect the NZ$ overseas, or anywhere? And presumably the cost of wages would be partly balanced by the drop in benefits, which would be lower than the net wages paid out.

    • NicTheNZer 16.1

      Could the government do it? Yes. Let’s assume that the government does it the conventional way and increases the budget deficit to pay for it. I pointed out in my reply to 5.1.2.1.1.1 that this is basically the same as printing if the reserve bank wants to maintain the OCR above zero.

      Would a large budget deficit cause inflation to rise? Well has it, the budget deficit has been quite high for several years in many countries with out inflation resulting. What about foreign exchange rates, nope no foreign exchange collapses in those either to observe. Yes the raise in tax receipts and fall in out benefit payments might reduce the deficit a bit but as I highlighted it’s not very important what is happening there anyway.

      So why would people think it does? Well the link is based on something called the quantity theory of money. It’s a long run theory which means it can’t be observed so it’s purely theoretical. And basically it turns out it’s not true, markets don’t automatically adjust so inflation tracks the quantity of money. (If anything the quantity of money probably tracks inflation).

      We might start to see inflationary effects when the government starts competing with the private sector for resources (including workers) but obviously in your scenario this is not happening as the workers are unemployed and the private sector doesn’t want them right now. This is because most inflation is cost push (business passing on their costs) and the economy is usually running below full capacity most sectors most of the time.

    • NicTheNZer 16.2

      Actually your proposal is similar to a policy Labour should adopt. The policy is usually called a job guarantee.

      The outline is,
      jobs in the job guarantee program are at the current minimum wage.
      Non profit and charity sectors may apply to the program for help, this is the main way of creating jobs.
      Government will hire anybody who applies for a job (picking a suitable job from above) and pay their salary.
      The system is administered by work and income but does not replace benefits such as disability at all.

      This would not be inflationary either because the people applying are not currently wanted by the private sector. Though having said this things like zero hour contracts may vanish as a result and some businesses which use these kinds of cost saving arrangements may face cost increases (there might be a one off price adjustment by some businesses here but many will have healthy profit margins which could also be reduced). The importance of the job part of job guarantee is that it solves a problem the unemployed face, employers prefer to hire the currently employed ahead of the unemployed.

      Unfortunately the job guarantee must not pay more than the minimum wage as this is likely to become the basic remuneration level for the economy. This kind of policy has been adopted in Argentina and India with success as well.

      • greywarshark 16.2.1

        NictheNZ
        Mmmm. Could be something in that!! What a genius you are. Why can’t the overpaid gigolos and gussies in Gummint think of that? I’m sick of the plain fashion that Bill English wears when he makes his economic rahrah pronouncements. He’s all noise and no substance. He should be wearing cheerleading gear, a tutu, or would that be tootoo much?

        • NicTheNZer 16.2.1.1

          Thanks but genius I am not. I am basically outlining economic theory according to post Keynesian economics and modern monetary theory. The reason to do that is so more people understand the financial system and then are able to push for it to be used for the advantage of the whole country.

          It’s not so hard to see that our finance minister is pretty clueless however. He frequently likes to explain how the government keeping the deficit down is purportedly keeping pressure off mortgage interest rates (whatever that means, the reserve bank is in control of these). OK that’s the kind of foolish thing Paul Krugman has said before, he could be in worse company. But he also said our banking system is insured by Australia as NZ mostly operates Australian subsidiaries, so his conception is that you will take Australian dollars if there is a problem. He is clearly getting bad advice.

          I think a job guarantee was part of IMP platform actually.

  16. greywarshark 17

    Economic Primer No.1
    See under Who Needs $4.8 billion anyway. Nov. 2014.

  17. We should all remember that if the so called financial genious Muldoon had not destroyed the Kirk Labour Super Fund we now would all be very well off,
    Labour builds Tories destroy the world over.

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    In order to meet our 2050 carbon target and do our bit to avoid making the Earth uninhabitable, New Zealand needs to decarbonise our economy, replacing fossil fuels with electricity in the energy, industrial and transport sectors. The good news is that it will mean cheaper power for all of ...
    No Right TurnBy Idiot/Savant
    6 days ago
  • Life in Lock Down: Day 8 (sanitised version)
    For those folk who find my other Lock-Down Diary versions too “negative” or otherwise unpalatable… Here’s a photo of a pretty flower, .   . Better? Tomorrow’s Sanitised Version: a cute animal video. . . . =fs= ...
    Frankly SpeakingBy Frank Macskasy
    6 days ago
  • Life in Lock Down: Day 8
    . . April 2: Day eight of living in lock-down… Today, my work day starts late. Our rosters and clients have been dramatically changed, lessening (theoretically) the number of people in our work “bubble”.  If just one of us catches covid19 the impact could be considerable as Grey Base Hospital ...
    Frankly SpeakingBy Frank Macskasy
    6 days ago
  • A note on apartments and bubbles
    As Aotearoa enters week two of lockdown, it’s clear we’re all still working out what our “bubbles” look like and how to stay in them to stop the spread of Covid-19. New to the government’s Covid-19 website is some good guidance for people living in apartment blocks. Recent decades have ...
    SciBlogsBy Siouxsie Wiles
    6 days ago
  • Getting in futures shape 
    “There are decades where nothing happens; and there are weeks where decades happen.” Lenin Don’t we all know that feeling now.

    Prospect Magazine alerted me to this particularly apt quote. It is a much more evocative quote than Hemingway’s “gradually then suddenly” which is also doing ...

    SciBlogsBy Robert Hickson
    6 days ago
  • Maybe axing Clark would be unfair. But what about any of this is fair?
    Yesterday was the day the consequences of the lockdown suddenly got very real for many. Firms have been closing and laying people off since the outset of the quarantine but this has mostly been happening out of the public eye. The mass closure of a number of iconic New Zealand ...
    PunditBy Liam Hehir
    6 days ago
  • Might a ‘Coasean’ social contract mitigate overall societal harm from COVID-19?
    Brian Williamson1, Prof Nick Wilson2 (1Economic consultant, UK; 2University of Otago Wellington) In this blog, we outline how a win-win social contract could be forged to address the major dimensions of response to the COVID-19 pandemic when using a mitigation strategy: the particular need to protect older people from high ...
    SciBlogsBy Public Health Expert
    6 days ago
  • Returning To “Normalcy”.
    Resuming Normal Service: The Republican Party's nominee for in 1920, Warren Harding, promised the American people: “not heroics, but healing; not nostrums, but normalcy; not revolution, but restoration”. If she wishes to remain our prime minister, then Jacinda Ardern will offer New Zealanders the same.HOW EDUCATED AMERICA snickered when the ...
    6 days ago
  • New Zealand’s Government Must Save New Zealand’s Media.
    No Free Society Without A Free And Functioning News Media: If we are to surrender our civil rights to the broader cause of defeating Covid-19, then foreign corporations must, likewise, surrender their right to inflict immense economic and cultural harm on New Zealanders simply because it improves their bottom line.I’M ...
    6 days ago
  • Corona fevers and the madness of models
    by Daphna Whitmore A third of the world is under lockdown and a clear assessment of this measure to curb the spread of COVID-19 is urgently needed.  With any high-stakes decisions it has to be asked what are we dealing with here? Are the measures warranted? Will they achieve their ...
    RedlineBy Daphna
    6 days ago
  • Lockdown day 8
    I haven’t done a huge amount in the last few days. I’m reading The Poppy War and I’ve sort of poked at a couple of games – I started SOMA but I’m a wimp and I quit while in the first room after the brain scan. I might try it ...
    The little pakehaBy chrismiller
    7 days ago
  • Backstage and Theatre
    The swan politicians may be gliding on the water, occasionally snapping at one another. Meanwhile, as the Covid19 crisis illustrates, the officials are desperately paddling below providing the real locomotion. One of the most fatuous recent grandstanding comments (of about a week ago), adding to the public’s anxieties, was ...
    PunditBy Brian Easton
    7 days ago
  • Legal Beagle: Waiver, the singular Crown and the conduct of Crown legal business
    Much has been written about the importance of discretion in an emergency situation, and the concerns raised by the potential for it to be exercised arbitrarily. Given the quality of the discussion, there seemed little point in adding to it at any length. In particular, I point to the evidence ...
    7 days ago
  • Highlights from Bauer Media’s science-related reporting
    Today has felt surreal. I was all set to touch base online with my science communication students when a colleague shared the news that Bauer Media would be shutting down its publications immediately. The first link I saw implied it was Woman’s Weekly affected, and even that shocked me. But ...
    SciBlogsBy Sarah-Jane O'Connor
    7 days ago
  • Outsiders.
    Bogeymen, Real And Imagined: Is the number of psychopathic and sociopathic individuals in any given society truly as vanishingly small as we like to tell ourselves? Isn’t it more likely that the mass-shooters and serial-killers filling the headlines represent only the tip of a much, much larger iceberg of frightfulness? ...
    7 days ago
  • We have a right to know the rules we are expected to obey
    Outgoing Police Commissioner Mike Bush appeared before the Epidemic Response Committee today, who asked him for the rules police are using to enforce the lockdown. He refused:Police Commissioner Mike Bush has admitted the advice given to Kiwis about what they're able to do during the lockdown hasn't been clear enough. ...
    No Right TurnBy Idiot/Savant
    7 days ago
  • Life in Lock Down: Day 7 (sanitised version)
    For those folk who find my other Lock-Down Diary versions too “negative” or otherwise unpalatable… Here’s a photo of my cat, . . Better? Tomorrow’s Sanitised Version: a pretty flower. . . . =fs= ...
    Frankly SpeakingBy Frank Macskasy
    7 days ago
  • Life in Lock Down: Day 7
    . . April 1: Day seven of living in lock-down… This morning I had a brief chat with one of my neighbours, “D” (social distance between us, a good three or four metres). I learned he had resigned from his previous job and had been hired by another company – ...
    Frankly SpeakingBy Frank Macskasy
    7 days ago
  • RIP The Listener, New Zealand’s pioneering voice
    Funnily enough, my thought as I start this post is whether it will be well written enough. Or should that be well enough written? Because so much of what I know about good writing came from my two stints at The Listener, which this morning was shut down due to ...
    PunditBy Tim Watkin
    7 days ago
  • OK, Britney: stop sniping at National for doing its job
    With normal democratic procedures in abeyance, there were two ways to go. First, it was open for the government to dissolve itself and invite the National Party to join a ministry of national salvation. That would have lessened the democratic deficit of the times by having a team of rivals without ...
    PunditBy Liam Hehir
    1 week ago
  • Helpful tips for parents during lockdown
    Dr Kirsty Ross Children and young people can respond differently in times of distress. This also varies by age and developmental stage, with younger children having more magical and imaginative thinking, and older children having more awareness and knowledge of the issues our communities are facing (which brings up ...
    SciBlogsBy Guest Author
    1 week ago
  • Skeptical Science New Research for Week #13, 2020
    1 week ago
  • Hungary is now a dictatorship
    Hungary has been a virtual dictatorship for a decade now, as Prime Minister Viktor Orbán has gradually eroded its democracy. But now, its official, with the passage of an indefinite emergency law allowing rule by decree:Hungary’s parliament has passed a new set of coronavirus measures that includes jail terms for ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • A new Ministry of Works
    While the economy is on pause under lockdown, the government is beginning to plan how to cope with the post-lockdown, post-tourism, post-export education world we will eventually find ourselves in. They're planning a lot of infrastructure spending as economic stimulus, and have asked for proposals which can start the moment ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Capture: Well spaced out
    It's my distraction,  setting up tiny scenes to photograph.  I've got stuck on the Babushka dolls for now.  Something about their bubble shape.  Something about their never changing, smiling features, suggesting persistent equanimity.  Can we get through everything that is being thrown at us and keep at least a tiny ...
    1 week ago
  • Life in Lock Down: Day 6
    . . March 31: Day six of living in lock-down… This time I managed to sleep a little longer and the alarm woke me at the pre-set time: 6.55am. Then remembered I was working a later shift and could’ve slept in. Oh well, there are things to do at home. ...
    Frankly SpeakingBy Frank Macskasy
    1 week ago
  • March ’20 – NZ blogs sitemeter ranking
    Image credit: Diamond Harbour School Blogs I notice a few regulars no longer allow public access to the site counters. This may happen accidentally when the blog format is altered. If your blog is unexpectedly missing or ...
    1 week ago
  • Hard News: Poll Pot and the partisans
    Yesterday's Horizon poll showing support for a "Yes" vote in this year's cannabis referendum sliding into the majority for the first time in a year looked like good news for reformers – and it probably is. But the result warrants some scrutiny.The poll is the fifth in a series commissioned ...
    1 week ago
  • Why those bubbles are so important
    For almost a week now, every one of us who isn’t an essential worker has been confined to their bubble. We are allowed to go shopping for groceries, to visit the doctor, and to get a bit of exercise if we stay local. The reason we are doing this is ...
    SciBlogsBy Siouxsie Wiles
    1 week ago
  • A Government System That Works
    The Covid-19 saga will no doubt produce many twists and turns for us before it is finally brought to an end. But one thing it has shown us – and what comfort it should bring us – is that our country’s government is in good hands. I am not thinking ...
    Bryan GouldBy Bryan Gould
    1 week ago
  • Smashing down the barriers: Where are we at with COVID vaccines?
    In the absence of a vaccine or a cure for a deadly disease, staying home in your bubble is what you do, the concept is not new.  To the best of my knowledge last time we did this in NZ was for polio, in the years before a vaccine came ...
    SciBlogsBy Helen Petousis Harris
    1 week ago
  • National Network on Cuba (USA): “Cuban medical solidarity is a pillar of its society and is founde...
    The following statement was released on March 28 by the National Network on Cuba, a coalition of 40 groups, based in the United States. In recent weeks, Cuba has deployed hundreds of medical providers to over a dozen countries in Europe, Asia, as well as to their neighbors in Latin ...
    RedlineBy Admin
    1 week ago
  • Alarming decrease in calves increases fears for endangered Hector’s dolphin
    This has been a terrible summer for Hector’s dolphins. The first indication was very low numbers of dolphin sightings during late spring and early summer. The Otago University Marine Mammal Research Team has carried out routine dolphin surveys at Banks Peninsula for more than 30 years. In all that time, ...
    SciBlogsBy Otago Marine Science
    1 week ago
  • Time for Grant Robertson to reveal package #2?
    On March 17, Finance Minister Grant Robertson was quick out of the blocks with an economic rescue package to help businesses through the inevitable recession resulting from the coronavirus pandemic. Robertson had pulled together a scheme in short order that so far seems to have saved many jobs. In his ...
    PunditBy Tim Watkin
    1 week ago
  • Saving lives
    The purpose of the lockdown is to save lives, by reducing the spread of covid-19. We won't know if its really working for another week, but given the devastation that will result if it doesn't - 14,000 dead is the optimistic scenario - its definitely worth trying. But pausing the ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Life in Lock Down: Day 5
    . . March 30: Day five of living in lock-down… Woke up still in darkness. Alarm hadn’t gone off. Turn to radio clock; it’s a few minutes after 6am… I lie there in the dark, waiting to drift off to sleep… but it ain’t happening. Clock ticks over to 6.55 ...
    Frankly SpeakingBy Frank Macskasy
    1 week ago
  • Speaker: Les Gray: the man who told the truth
    The story of Les Gray, the public sector psychologist who told the truth about his use of cannabis and set off a storm, has a special place in the lore of cannabis reform in New Zealand.When Paul Shannon interviewed Gray for the 'Dope and Hope' issue of Planet magazine in ...
    1 week ago
  • Why now? Historical specificity and the perfect storm that has created trans identity politics
    by Phil Duncan For Marxists, a key concern about social trends is their context – not just their causes, but why they happen when they do.  Events and phenomena have causes, but they also are time or period-specific. While much of the left have capitulated recently to postmodernism, most notably ...
    RedlineBy Admin
    1 week ago
  • Time for a living wage for supermarket workers
    Since the lockdown began, we've all suddenly been reminded who the actually essential workers in our society are: not the people at the top who pay themselves the big bucks and rort the perks, but the people at the bottom they screw over and squeeze: cleaners, warehouse staff, truck drivers ...
    No Right TurnBy Idiot/Savant
    1 week ago

  • More time for health workers and elderly to get flu vaccine
    The Government has extended by two weeks till April 27 the amount of time priority groups, such as health workers and those aged over 65, have to get their flu vaccine before it is made available to the wider public. This year’s vaccination campaign is a key component of the ...
    BeehiveBy beehive.govt.nz
    29 mins ago
  • Communities step up to help New Zealanders stay connected and fed during lockdown
    Communities stepping up to help New Zealanders stay at home to break the transmission of COVID-19 and save lives have received Government support, said Minister for Social Development Carmel Sepuloni. “Delivering groceries for the elderly who can’t shop online, providing data packs for low income families to keep them connected, and being ...
    BeehiveBy beehive.govt.nz
    15 hours ago
  • 120 COVID-19 testing centres now operating
    Across New Zealand 120 sites are taking samples to be tested for COVID-19.   68 community based assessment centres (CBACs) have been established to take samples from people with COVID-19 symptoms. Alongside this, 52 other centres including designated general practices, swabbing centres, and mobile clinics are now testing people for ...
    BeehiveBy beehive.govt.nz
    16 hours ago
  • Covid19: Government moving quickly to roll out learning from home
    The Ministry of Education is working with partners to develop a package of options so that students can learn at home when Term 2 begins on 15 April, Education Minister Chris Hipkins said today. Supports are also being prepared for households with children under five, to help parents and whānau ...
    BeehiveBy beehive.govt.nz
    17 hours ago
  • Making learning from home accessible to Māori learners and whānau
    Māori Television to begin educational te reo programmes Ki te Ao Mārama – a new online learning space Thousands of hard copy learning packs ready for distribution Helpdesk and advice service for kōhanga, kura and wharekura Television, the internet and hard copy learning packs are some of the ways whānau ...
    BeehiveBy beehive.govt.nz
    18 hours ago
  • New Zealand to provide assistance to Vanuatu following Tropical Cyclone Harold
    Foreign Affairs Minister Winston Peters has announced an initial package of support to help the people and the Government of Vanuatu respond to the impact of Tropical Cyclone Harold. “Our Pacific neighbours have been hit by a Category 5 Cyclone at the same time as dealing with the economic impacts ...
    BeehiveBy beehive.govt.nz
    19 hours ago
  • Planning for the future of tourism
    Tourism New Zealand to lead work reimagining the way tourism operates in post-COVID-19 world. Ministers to review International Visitor Conservation and Tourism Levy investment plan. The Government, industry and business are working together to develop a plan for how tourism will operate in a post-COVID-19 world, Tourism Minister Kelvin Davis ...
    BeehiveBy beehive.govt.nz
    21 hours ago
  • NZ horticulture sector feeding Kiwis and the world during COVID-19
    More New Zealanders are taking up the chance to work in horticulture as the sector keeps New Zealanders fed and in jobs during the COVID-19 Alert Level 4 lockdown. “Our horticulture sector has long been one of New Zealand’s export star performers, contributing around $6 billion a year to our ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • Work to repurpose PGF funds begins
    The Provincial Development Unit is working through applications and projects to see where Provincial Growth Fund money can be repurposed for initiatives deemed more critical to fighting the economic impacts of the COVID-19 pandemic, Regional Economic Development Minister Shane Jones says. “We need to be throwing everything we have at ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • A million workers supported by Govt wage subsidy
    The Government’s wage subsidy to protect jobs and keep workers and businesses connected during the lockdown has now supported over a million New Zealanders, with $6.6 billion already paid out. “We’re supporting businesses to pay wages, and stay connected with their workers so that we are all in a better ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Government helps Pacific communities fight COVID
    The Government is stepping up efforts to help protect New Zealand’s Pacific communities in the fight against COVID-19. Cabinet has agreed that $17 million will be allocated to support a COVID-19 Pacific Response Package, which will: Support Pacific health and disability services facing increased demand; Ramp up public health messaging ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Statement from the Prime Minister on Dr David Clark
    “Yesterday evening the Health Minister advised me of his trip to a beach during the lockdown and offered his resignation,” Jacinda Ardern said.  “Under normal conditions I would sack the Minister of Health. What he did was wrong, and there are no excuses.  “But right now, my priority is our ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Statement from David Clark
    Last night as part of my preparation for the Epidemic Response Committee, I provided the Prime Minister with a complete picture of my activity outside my home during Alert Level 4.  That included the fact that on the first weekend of the Alert Level 4 lockdown I drove my family ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • COVID-19 mental health support begins
    A range of support is being rolled out across New Zealand to help people look after their mental health during COVID-19 Health Minister David Clark said this morning. “COVID-19 has brought a lot of uncertainty into our lives and many of us will be feeling some level of distress or ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • New Zealanders in Peru to be assisted by Government charter flight
    The New Zealand Government has made arrangements to charter a flight for New Zealanders stranded in Peru to depart the country, following agreement with the Chilean government to allow the necessary transit through Chile, Foreign Affairs Minister Winston Peters announced today. “Like many travellers around the world at the moment, ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • COVID-19 Hospital Preparation Well Advanced
    Hospital preparations for COVID-19 are well advanced says Health Minister David Clark. “Hospitals across New Zealand are repurposing buildings and training staff to get ready for COVID-19 patients. This gives me confidence that we are well prepared for any potential increase in COVID-19 patients needing hospital level care,” said David ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Further measures to support businesses
    The Government will be introducing legislation to make changes to the Companies Act to help companies facing insolvency due to COVID-19 to remain viable and keep New Zealanders in jobs. The temporary changes include: Giving directors of companies facing significant liquidity problems because of COVID-19 a ‘safe harbour’ from insolvency ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Govt’s COVID plan, economic strength recognised
    The Government’s plan to cushion the blow of COVID-19 by supporting incomes, jobs and businesses, and position the economy to recover has been backed by another international report. International credit rating agency Moody’s today reaffirmed its highest Aaa credit rating on New Zealand, saying the economy is expected to remain ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Funding certainty for sports through COVID-19
    National sports organisations have been given certainty of funding to ensure they can remain viable through the COVID-19 pandemic, Sport and Recreation Minister Grant Robertson announced today. “The global spread of COVID-19 has had a significant impact on sport and recreation in New Zealand, including the cancellation or postponement of ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Butchers now allowed to process pork
    Changes have been made to allow butchers to process pork, only for supply to supermarkets or other processors or retailers that are open, Agriculture Minister Damien O’Connor has announced. “We carefully weighed the risk of allowing butchers to open their shops for retail customers, but the risk of spreading COVID-19 ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Essential workers leave scheme established
    Essential workers who take leave from work to comply with public health guidance are being supported with a leave scheme to ensure they will continue to receive income, say the Minister of Workplace Relations and Safety Iain Lees-Galloway and Minister for Social Development, Carmel Sepuloni. A number of essential businesses ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Govt WhatsApp helps share COVID-19 information
    A Government WhatsApp channel has been launched to help make information more easily accessible and shareable in the fight against COVID-19. Govt.NZ, which is free to use on any mobile device, will carry information and news for the public, businesses, healthcare providers, not for profits and local government. It can ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Managed departure plan for stranded foreign nationals enables safe, orderly exit
    The Government has announced a plan to enable the safe, orderly exit of tens of thousands of stranded foreign nationals from New Zealand during the current COVID-19 Alert Level 4 restrictions, Deputy Prime Minister and Foreign Minister Winston Peters has said. “When we moved into lockdown a week ago, the ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Government delivers COVID-19 support to GPs and Pharmacies
    Health Minister Dr David Clark says the Government is delivering on its commitment to support general practice doctors and nurses, and pharmacies on the front-line of our fight against COVID-19. "For us to overcome COVID-19, we need community health services such as general practice and community pharmacy to step up ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Susan Thomas the new Chief High Court Judge
    Justice Susan Thomas has been appointed Chief High Court Judge, Attorney-General David Parker announced today.  She replaces Justice Geoffrey Venning who has resigned from the position.   David Parker paid tribute to Justice Venning, who he said had stewarded the High Court very capably over the last five years.   “On behalf ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Business Finance Guarantee – applications open
    Businesses can start applying to their banks for loans under the Business Finance Guarantee Scheme set up to support the New Zealand economy during the COVID-19 pandemic. “We’re moving quickly to protect New Zealand businesses, jobs and the economy during this unprecedented global economic shock,” Finance Minister Grant Robertson said. ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Work starts on ways to fast-track consents to boost recovery from Covid-19 downturn
    Work is underway looking at measures to speed up consents for development and infrastructure projects during the recovery from COVID 19, to provide jobs and stimulate our economy.  Environment Minister David Parker said the COVID-19 pandemic is a serious global crisis that will have a wide ranging and lasting impact ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Advance payments to support contractors
    Advance payments will be made to transport construction industry contractors to retain the workforce and ensure it is ready to quickly gear up to build projects which will be vital to New Zealand’s COVID-19 economic recovery, Transport Minister Phil Twyford announced today. He said keeping the workforce required to build ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Government seeks infrastructure projects
    The Government has tasked a group of industry leaders to seek out infrastructure projects that are ready to start as soon as the construction industry returns to normal to reduce the economic impact of the COVID-19 pandemic, Economic Development Minister Phil Twyford and Infrastructure Minister Shane Jones say. The Infrastructure ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Health system scaled up to prepare for COVID-19
    Work to scale up the health system in preparation for COVID-19 was today outlined by Health Minister David Clark, as he reported back to the new Epidemic Response Committee. “We are well placed to contain the spread of COVID-19. We have taken early and decisive action at our borders, and ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Essential media COVID-19 guidelines refined
    The Government is refining its COVID-19 essential business guidance to include the distribution of news publications for communities which are hard to reach. The Minister of Broadcasting, Communications and Digital Media, Kris Faafoi, said the move was in recognition of the importance for New Zealanders who might be harder to ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Supermarkets able to open on Easter Sunday
    The Government is ensuring supermarkets can open on Easter Sunday so we can buy groceries, but stay closed on Good Friday allowing workers to take a break. This provides a balanced approach and ensures we avoid large queues that two days closure may cause. “Supermarkets will be able to open ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Zealand defence personnel conclude mission at Taji
    Following the successful conclusion of the Building Partner Capacity (BPC) mission at Taji, New Zealand defence personnel are returning to New Zealand from Iraq, in accordance with the Cabinet decision made in June 2019, Foreign Affairs Minister Winston Peters and Defence Minister Ron Mark announced today. “New Zealand is very ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • State of National Emergency extended
    The State of National Emergency to help stop the spread of COVID-19 has been extended for a further seven days, Minister of Civil Defence Peeni Henare said. The initial declaration on March 25 lasted seven days and can be extended as many times as necessary. “Since we went into isolation ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Strong Govt books support ‘go hard, go early’ response
    New Zealand’s ability to go hard and go early in the fight against COVID-19 has been underpinned by strong Government finances and the growing economy heading into this global pandemic, Finance Minister Grant Robertson says. The Treasury today released the Crown financial statements for the eight months to the end ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Christchurch Hospital Hagley ICU to open to support COVID-19 response
    Health Minister Dr David Clark says 36 new intensive care beds at Christchurch Hospital’s new Hagley building are being fast tracked so they are available for treatment of COVID-19 patients.   The Ministry of Health is working with contractor CPB and Canterbury DHB to enable access to the hospital’s ICU, ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Government supports Air NZ freight flights
    The Government has fast-tracked up to $1 million to help Air New Zealand move urgent freight to and from New Zealand, with the first flight to Shanghai leaving tonight, Transport Minister Phil Twyford announced today. Phil Twyford says it’s crucial that trade in vital goods such as medical supplies and ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Tariff concessions on COVID-19 related products
    New Zealand will temporarily remove tariffs on all medical and hygiene imports needed for the COVID-19 response. Trade and Export Growth Minister David Parker and Commerce and Consumer Affairs Minister Kris Faafoi said today that the New Zealand Customs Service will apply tariff concessions to all diagnostic reagents and testing ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Clarification of modification to wage subsidy scheme
    Minister of Finance Grant Robertson has clarified that the changes to the wage subsidy scheme announced yesterday mean that employers should be passing on the full subsidy to workers, except in the case where the person’s normal income is less than the level of the subsidy. “We still want employers ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Face masks flowing to DHBs
    Medical face masks from the national reserve supply are now being distributed to District Health Boards, while at the same time local production is being ramped up. Yesterday more than 640,000 masks were sent to DHBS – that is an immediate two week supply, with more to follow in coming ...
    BeehiveBy beehive.govt.nz
    2 weeks ago