Why First NZ Capital wants you to keep paying too much for power

35 comments on “Why First NZ Capital wants you to keep paying too much for power ”

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1. IrishBill 1

   1 May 2013 at 7:25 am

   I was particularly pissed off at the unchallenged run these corporate wideboys were given on RNZ. Now I know they had a $9m undisclosed conflict of interest I’m furious. Why the fuck is this only coming out now on TS? Did nobody in the MSM bother to ask?
   • tc 1.1

     1 May 2013 at 7:38 am

     RNZ has become part of the NACT spin machine under Griffin, morning report/9-noon/mora are soapboxes, Mary Wilson appears to be the only one who does what is required being question and probe armed with facts and research.

     Hooton, DPF etc all given a free run, you gotta hand it to the hollowmen it’s a slick operation.
     • Ruobeil 1.1.1

       1 May 2013 at 7:56 am

       Just like Campbell is part of the Labour spin machine.
       • Paul 1.1.1.1

         1 May 2013 at 8:07 am

         You’re up early in an attempt to derail rational discussion.
         • lprent 1.1.1.1.1

           1 May 2013 at 8:22 am

           Yeah I already booted one of his comments to OpenMike.
     • aerobubble 1.1.2

       1 May 2013 at 4:58 pm

       i thought moro remit was to pull in stupid rightwingers and expose them Since their statements are often as absurd as they are abuse of common sense. NR does have a duty to offer both left and right wing stand points. That the right is no longer gifted with kudos for growth and their fiscal nouse is laughable, so of course stacking the ranks with stupid right winger might actually suggest NR are doing us all a service. Imagine a Joyce, or a English, or Brownlee, actively engaging the real concerns of the business world, it would be deeply disturbing because they might actually go on and manage the economy for all NZ. It ain’t going to happen, they’ve spent to long in their metaphorical fish bowl having money thrown at them to show their naked neo-liberalism..
   • Draco T Bastard 1.2

     1 May 2013 at 7:46 am

     That would require them to question their Lords and Masters and their own beliefs.
   • Paul 1.3

     1 May 2013 at 7:55 am

     Maybe Eddie could email his research to several news outlets, particularly RNZ, Campbell Live and the ODT as these are the last vestiges of independent mainstream media in the country.
     Challenge them to ask these shills questions about conflicts of interest.
     • Ruobeil 1.3.1

       1 May 2013 at 8:07 am

       Campbell independent? Yeah right.
       • Paul 1.3.1.1

         1 May 2013 at 8:55 am

         Just to get an understanding of where you stand on issues? What news sources do you see as the most reliable?
         • McFlock 1.3.1.1.1

           1 May 2013 at 12:24 pm

           National party press releases, obviously.
         • Murray Olsen 1.3.1.1.2

           1 May 2013 at 11:11 pm

           WhaleSpew presents the facts and lets Rube make up his own mind. Alex Jones is also fair and balanced. Anything on talkback radio is above any suspicion of bias.
2. The Gormless Fool formerly known as Oleolebiscuitbarrell 2

   1 May 2013 at 8:08 am

   Strange that my broker at First NZ Capital advised me against buying Mighty River Power shares after the Labour/Greens announcement, then.
   • lprent 2.1

     1 May 2013 at 8:13 am

     Were they First Capital? Otherwise what relevance does that have to the post? Should I move this one to OpenMike as being off topic?

     Edit: ha – I see the comment was updated to show it was First Capital.

     The whole point of Eddie’s posts is that power prices are excessive and there are a lot of greedy bastards giving crap advice against a policy that is designed to regulate and curb that behaviour.

     At least you had a moderately honest broker. Most of the ones I and the family have run across seem only to be interested in pushing junk with good commission values. Which is why the NZX looks irredeemable to me. Anyone with any sense treats it as being an incestuous bearpit designed to fleece “mom and dad” investors.
     • The Gormless Fool formerly known as Oleolebiscuitbarrell 2.1.1

       1 May 2013 at 8:28 am

       Not updated. Always referred explicitly to First NZ Capital. Which makes your haughty tone a little offensive.
       • lprent 2.1.1.1

         1 May 2013 at 9:23 am

         Well either my eyesight is going because I explicitly looked for something after “my broker” because the comment made no sense in terms of the post, or you made an edit that your fast approaching senility has dropped out of memory.

         I could check in the comment edits log, but there hardly seems a point.
         • The Gormless Fool formerly known as Oleolebiscuitbarrell 2.1.1.1.1

           1 May 2013 at 9:24 am

           If those are the two options, your eyesight is going.
   • Lightly 2.2

     1 May 2013 at 8:51 am

     Gormless. They want your custom to continue, so they have an incentive to advise you against a bad deal. But they don’t have an ongoing relationship with all the other ‘mums and dads’ and they make more money if those saps buy in. Hence, different advice to a client then to the public in general
   • Shaz 2.3

     1 May 2013 at 10:44 am

     Hi, Ex Ole,

     Perhaps you are one of the high rollers who is being privileged by being given the @real oil@ by your broker? That would make sense. As I recall share market brokers have a proud tradition of encouraging small independent investors while protecting others from risk.

     Oops see I have made the same point as lightly.
3. vto 3

   1 May 2013 at 8:50 am

   .
   sharebrokers

   car dealers

   real estate agents

   believe them with utmost care
   • King Kong 3.1

     1 May 2013 at 9:00 am

     You left anonymous blog commentors and politicians off your list
     • McFlock 3.1.1

       1 May 2013 at 12:28 pm

       indeed.
       that’s why linking to sources and/or having a coherent train of thought makes the posts on this site so informative.
     • Murray Olsen 3.1.2

       1 May 2013 at 11:12 pm

       How did your parents choose the first name King?
4. tracey 4

   1 May 2013 at 9:58 am

   Its not about nz being small, its about declaring your conflicts of interest so that the information you impart can be properly weighted. Hiding a conflict leaves wide open the suggestion you are trying to skew the debate
   • vto 4.1

     1 May 2013 at 10:01 am

     It actually puts First NZ Capital in breach of the Fair Trading Act – misleading and deceptive conduct in trade.

     Very clear (provided there was no teency tiny fine print somewhere declaring their massive gigantic overweight conflict of interest).
5. prism 5

   1 May 2013 at 10:02 am

   . ‘Everyone has links to everyone in New Zealand’
   But everyone doesn’t pay my bills. And I don’t want to be in a position that I have to beg for that aid from the wealthier persons of my acquaintance.

   Knowing or being related to lots of people doesn’t mean that you as an individual shouldn’t be your own person. We’re not like the golden haired children in John Wyndhams science fiction story The Midwich Cuckoos. They knew everything that each other experienced or thought. There was a 1960 film version called Village of the Damned (sequel called Children of the Damned).

   I think some people commenting have in mind –
   “Six degrees of separation is the theory that everyone and everything is six or fewer steps away, by way of introduction, from any other person in the world,” (from Wikipedia)
   which is just an interesting concept. And might be tested by NZs hanging around in Piccadilly Circus for long enough.
6. DH 6

   1 May 2013 at 12:13 pm

   First NZ Capital were one of the consultants the Govt used to value the SOEs. Another was Macquarie Group, also a joint lead manager for the share float.

   http://www.comu.govt.nz/publications/information-releases/valuation-reports/

   Interesting they’ve removed the Mighty River valuations, can get the 2010 ones here;

   http://www.comu.govt.nz/resources/pdfs/valuation-reports/mrp-vr-f-10.pdf
   http://www.comu.govt.nz/resources/pdfs/valuation-reports/mrp-vr-m-10.pdf

   The valuations are quite useful because they include forward projections which can be compared against actual performance in the 2011 and 2012 annual reports.
7. muzza 7

   1 May 2013 at 12:46 pm

   Eddie – Very good series, which needs to be distributed to every/any MSM outlet you can deliver the work to. It matters not if it ends up on the wire/print etc, of course that would be fantastic, but whats matters that people who work in such establishments read/comprehend such angles, and who knows, perhaps even begin to consider some rather straight forward thinking.

   What you are illustrating in this series, is that who controls the money/funding, controls the narrative, controls the resources, controls the outputs!

   Same applies to any/every industry going around, and its important for people to have commentary into such goings on!

   Really good work Eddie, appreciated, and do your best (and everyone on here) to distribute these articles, and others to the MSM emails addresses, which are easily obtained.

   Much more proactive than simply commenting!
8. geoff 8

   1 May 2013 at 1:23 pm

   That central claim (not backed by any data or even source) turns out to be wrong – if you exclude lines charges, retail prices have risen even faster in the past 15 years – which confirms that its wholesale prices that are the problem.

   Wholesale prices are the main problem but lines companies played a part too. The bogus asset revaluations that allowed the gentailers to up their prices were apparently also adopted by the lines companies for a while. But then regulation for the lines companies came in that stopped them from continuing the upwards revaluations that the gentailers got away with.

   Geoff Bertram talks about it all in the 2nd half of this audio:
   http://podcast.radionz.co.nz/ntn/ntn-20130423-0908-the_state_of_state_asset_sales_percent_differing_electricity_policies-048.mp3
9. Dave 9

   1 May 2013 at 1:47 pm

   Their real inflation figure nett of line charges seems about right. I got 3.2% PA using a simplistic quick calculation, and the MBIE figures don’t include prompt payment discounts etc. CPI inflation over the period 2000-2012 was 39%.

   They do give their source (“based on Ministry of Business, Innovation, and Employment pricing quarterly surveys”, the same monthly surveys you link to) and their rationale for the increases: gas prices went up 5.6% PA over inflation, more expensive generation methods were added to the grid, and several other reasons.

   In context this was a Credit Suisse research note for Contact Energy and how the proposed reforms would affect its share price, not a piece of punditry on the reforms in general.
10. aerobubble 10

    1 May 2013 at 5:11 pm

    Look National run out shouting that we have the fourth fastest growth…

    …perplexed…

    …haven’t National noticed, the world economies are in huge strife carrying huge debt woes…

    …didn’t National have to go reassure world banks about the heavily indebted NZ economy…

    …you know, the 2nd most after Greece.

    A pickup in the global economy will leave NZ standing, having the huge private debt, and growing government debt Key is running up, STILL to deal with. Without major revision to our tax incentives then our pirot victory of fourth fastest growing (off the back of CHCh rebuild) is just that, a false reassurance.

    National suck at economics.
11. SomeSuch 11

    1 May 2013 at 9:10 pm

    Interesting.

    Taking a shorter length of time (5 years) suggests:

    CPI + 2.4% (Stats NZ)
    Line charges +6.1% (CPI adjusted = 3.7%) (MED)
    Retail non-line charges +4.4% (CPI adjusted = 2.1%) (MED)

    Retail based on market share.

    Taking the longer view (13 years) suggests:

    CPI +2.6%
    Line charges +9.7% (+7.2%)
    Retail non-line charges +7%(+4.2%)

    Of course non-line charges now comprise a larger share of a residential power bill (62% v. 52%).

    So while First Capital’s maths may or may not be right (can’t tell without data sources or method) the general thrust of their argument in the recent term is correct. Power prices have slowed considerably relative to inflation.
    • Colonial Viper 11.1

      2 May 2013 at 1:04 am

      Meh, first give consumers back $500M in excess power profits and we can talk.
      • SomeSuch 11.1.1

        2 May 2013 at 10:44 am

        Naif.
    • aerobubble 11.2

      3 May 2013 at 1:46 pm

      Power prices have slowed, well, duh, power demand has as many cut their energy use in the face of a global wide depression.

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