Gonna tell on you

July 18, 2014

Quote of the day from Trans Tasman:

. . . Meanwhile Dotcom, is now promising to reveal all he knows about John Key just before the election. And it’s pretty damn big, he says. Oh yes. In political terms, this is a bit like the playground “gonna tell on you and my father is a policeman and my aunt is a wrestler and you’re gonna be REAL SORRY!” . . .

This reminds me of Labour’s desperate smear attempts before the 2008 election when they sent Mike WIlliams to Australia to dig the dirt.

He came up with egg on his own face and no dirt at all.

If Dotcom really has something on Key he’d spill it now which would give the opposition a strong foundaiton on which to build an all-out assault.

The only advantage in waiting is to keep himself in the headlines.

The importance of certainty

July 4, 2014

Trans-Tasman notes the appeal of certainty and stability:

National emerged neat and tidy from its election year conference. Delegates went home knowing what they have to do to ensure the party can re-form a governing coalition. It’s this disciplined approach which carries its own message to the electorate, contrasting with the inchoate array of parties lined up on the other side of the fence. Private polling shows within the electorate, opinion is beginning to harden on the parties of the left being so disparate, (even if they gained a majority of seats in the next Parliament), a coalition of those parties would be highly unstable and couldn’t last.

Certainty, along with stability, is the priority for most voters. The difficulty for the parties of the left is they project not just instability, but incoherence in the policies they are espousing. The realisation has grown Labour would have to share power with the Greens, NZ First and possibly the Mana/Internet alliance. How would it work? In the NZ Herald this week John Armstrong noted Labour seems to be increasingly paralysed by the division between MPs who put a priority on economic development and those who want environmental concerns to be very much part of that development.

The Opposition has forgotten what Helen Clark did in the run-up to the 1999 election, staging a reconciliation with Jim Anderton and his Alliance to project a united front and give electors an idea of what a Clark-led Govt would look like (even though it must have savaged her personal pride to cosy up to her old foe). . . 

 The more voters see of what a Cunliffe-led Labour/Green/NZ First/Mana/Internet Party might look like the less appeal it has.

There are enough uncertainties in most people’s lives without adding an uncertain coalition and the instability that would come with it especially when its contrast with the certainty and stability of a National-led government with John Key as Prime Minister.

Regions bouyant

June 28, 2014

Opposition parties have been trying to convince us the regions are in decline, but the reverse is true:

. . . The latest Westpac survey shows economic confidence has declined in most regions but remains buoyant. Respondents in the quarterly survey are not so upbeat as previously. It follows reports from some economic groups and unions that some regions outside Auckland are at risk of stagnating. ANZ Bank economists disagree with the stagnation theory. They say the idea the regions are being plundered for the benefit of the cities is simply not backed up by the statistics. “Our own Regional Trends proxy for regional economic activity puts Northland at the top of the annual growth stakes in the year to March 2014.” Canterbury and Auckland have led economic growth over the past few years. Strong rises have also been recorded by Waikato, Otago, Taranaki and Nelson-Marlborough. The ANZ commentary says to get the full story, it’s worth doing a bit of knife-and-fork economics (that’s a few dinners chatting along the way).

“While everyone talks about Christchurch, 100km down the road is a place called Ashburton; it’s booming. That’s irrigation for you. South Canterbury is riding the same wave. Central Otago is going very well with evening flights the icing on Queenstown’s cake. Ironically in Otago, it’s the city (Dunedin) that is underperforming the region. Southland is just Southland and getting on with business and not crowing about it. Blenheim just had a bumper grape harvest; Nelson has a reasonable vibe (was there last Wednesday). Taranaki – white and black gold working in tandem. Bay of Plenty – Psa being worked through (kiwifruit land prices have rebounded), they’re seeing Aucklanders relocate, and the port is going well (though the forestry sector is grinding to a halt, which is something we’re watching). Wellington – no Govt spend but lots of IT spend and investment, and Kapiti is doing nicely. Waikato – a 2-hour wait to get into Fieldays the other Friday told us something. Manawatu – trundling along solidly. There are weak spots, but this talk of cities surging and the regions being down in the dumps is just hubris. In many cases it’s not a lack of demand or opportunities holding regions back, it’s getting the available resources (particularly labour). That’s not a bad problem to have!” . .

Just like the manufactured manufacturing crisis opposition parties tried to promote, regions aren’t in decline, they’re buoyant.


Compounding moral bankruptcy

June 9, 2014

John Banks served as an electorate MP and Minister, retired then returned to parliament representing a party with whose principles and philosophy he had something in common but which weren’t best matched to his own.

Laila Harre served as a list MP and Minister, retired and is now seeking to return to parliament leading a party which doesn’t appear to have much in the way of principles.

Worse it’s led by man whose actions appear to be diametrically opposed to all she professes to believe in.

As Trans Tasman pointed out last week:

. . . It is possible, back when she was an ardent campaigner for feminism and against capitalism, racism and corporatism, Harre foresaw the day she would sign up to front a party funded by a convicted German fraudster who made much of his money from pornography and who also has a fetish for racist, not to say outright Nazi, humour. Harre wasn’t even elected: she was anointed by the aforementioned convicted German fraudster who has trafficked in pornography and who thinks n-word jokes are hilarious.

There are many terms for this sort of thing, none of them complimentary. We will avoid the ‘h’ word – not just because MPs are not allowed to use the term hypocrisy in the House, but mostly because hypocrisy is part of the human condition. All of us fall short of our ideals. But this is not mere hypocrisy, not a minor falling short. This is moral bankruptcy of a particularly shameless kind. . .

At least Banks had some positive things in common with Act.

All Harre has is negative – the aim to get rid of John Key and National.

And Banks wasn’t bought by anyone.

Harre is accepting Kim Dotcom’s money – a salary of more than $100,000 for herself and millions for the party.

If she thinks he won’t expect her to dance to whatever tune he calls, she’s compounding the moral bankruptcy with stupidity.


Carbon tax conundrum

June 6, 2014

Trans Tasman explains the implications of the Green Party carbon tax policy and the conundrum it poses for Labour:

. . . Dairy farmers who are currently exempt from the ETS will pay a reduced rate of $12.50 a tonne for their pollution. Beef and sheep farmers will be exempt. A BERL economic report released with the policy indicates the average dairy farmer would take a 12.5% hit to their income, and should the milk price fall to around $7kg M/S, about 10% of dairy farmers would be vulnerable. Implementation of the policy would hinge on post-election backing from Labour, which appears at best lukewarm – David Cunliffe is already distancing himself from the policy saying it is Green policy to be negotiated after the election. NZ First leader Winston Peters says he does not support a carbon tax. So it leaves confusion in voters’ minds whether a carbon tax would be a goer.

A policy with such serious implications as this isn’t one that ought to be left to post-election negotiations.

Whether or not Labour would countenance the tax could well influence voters – but maybe that’s why Cunliffe won’t make a stand.

What Peters says he supports and what he would actually support, given the chance, aren’t necessarily the same thing.

But it does confirm the Greens, in placing such a high priority on climate change protection (even though NZ is only responsible for 0.14% of global emissions), want to drive fossil fuel producers out of business, and halt the expansion of dairying. And if Labour has to cosy up closer to the Greens to ensure it looks like a Govt-in-waiting, how will this play out in electorates like the West Coast (where mining is a core industry) or New Plymouth where Andrew Little, with leadership ambitions, will be trying to show he can win a seat? . . .

A party trying to gain only a relatively small proportion of the party vote can afford policies which impact badly on certain areas.

Those trying to win electorates too are much more aware of the negative impact policies which might be attractive in theory have on real people in practice in real life.




Moral bankruptsy

June 5, 2014

Quote of the day:

Election year has already been a rather bizarre one. . . .

But we kind of crashed through the looking glass last week with the anointment of Laila Harre as leader of Kim Dotcom’s Internet Party. It is possible, back when she was an ardent campaigner for feminism and against capitalism, racism and corporatism, Harre foresaw the day she would sign up to front a party funded by a convicted German fraudster who made much of his money from pornography and who also has a fetish for racist, not to say outright Nazi, humour. Harre wasn’t even elected: she was anointed by the aforementioned convicted German fraudster who has trafficked in pornography and who thinks n-word jokes are hilarious.

There are many terms for this sort of thing, none of them complimentary. We will avoid the ‘h’ word – not just because MPs are not allowed to use the term hypocrisy in the House, but mostly because hypocrisy is part of the human condition. All of us fall short of our ideals. But this is not mere hypocrisy, not a minor falling short. This is moral bankruptcy of a particularly shameless kind. Trans Tasman

These are strong words – they’re also right.

Blame the media

May 2, 2014

Trans-Tasman opines:

You can’t say anything critical about the Labour Party at the moment it seems, without being accused of bias. The party’s activists, both at MP and grassroots/social media level, have become extraordinarily chippy and defensive of late. The one big policy initiative this week, the compulsory savings and monetary policy announcement, was accompanied, in finance spokesman David Parker’s speech, by an extraordinary amount of defensive rhetoric about how much the party is being mis-represented.

It is not just the usual politican’s slag-the-media, get-your-retaliation-in-first tactic. There is a genuine and rising tide of bile among Labour folk towards what they feel is a biased and pro-National political media.

Labour keeps doing stupid things, not to report that would be bias.

Bias comes in many forms though: in media matters, the most important is narrative and confirmation bias rather than ideological. If you go back a decade, the narrative bias was Labour’s Helen Clark was all-competent, all-effective, while National had trouble finding its own backside with both hands. If an expectation has been created of a certain type of behaviour, journalists will go looking for it. As a matter of substance, Labour leader David Cunliffe’s bogus claim of a grandfather with a Military Medal is pretty trivial. Most of us have family oral histories with an element of embroidery about them. But against a background of playing too cute with the facts it was asking for trouble.

The medal claim wouldn’t have been perceived so negatively, and covered so widely, had Cunliffe not already had a reputation for gilding the lily.

Most of us are not political leaders, and most of us are not putting such matters of family history into speeches aimed at garnering political support. The only way to counter this bias is to stop doing things which feed it. . .

That doesn’t mean letting media training turn you into an automaton:



Gift of praise for birthday

April 10, 2014

Yesterday was Social Development Minister Paula Bennett’s birthday and Trans Tasman gives her the gift of praise:

. . .Is Paula Bennett the most effective Minister to have held the Social Development portfolio? There’s little doubt her welfare reforms are hitting the mark, judging by the fierce reaction to the news at least 21,000 beneficiaries have travelled overseas in the past nine months. Of those, nearly 5000 have had their benefits cancelled once eight weeks had elapsed since their departure. It makes it hard for Opposition politicians to pitch the case of growing inequality. Bennett has also been equally effective on issues like family violence, when lobbyists (who would normally be critical of a National Minister holding the portfolio) praise her work and say they want her to keep on with it…………

Having lobbyists on social matters, who are almost on the left of the spectrum, want her to stay on is high praise and well deserved.

Political playground

April 8, 2014

Trans Tasman takes politicians back to school:

Hone Harawira, one suspects, used to specialise in Chinese burns and other playground tortures when he was at school. The Mana Party leader has the kind of air about him redolent of such schoolyard antics. John Key was probably the cheeky kid who cracked enough jokes to be popular with the other kids but who nevertheless did his homework assiduously and kept on authority’s good side. David Cunliffe was the greasy goody two shoes, bright, geeky and probably a bit of a sneak. Peter Dunne – swotty pants. Russel Norman – ditto, but a more argumentative version of the same. Metiria Turei: the slightly flaky party girl (a bit like Paula Bennett, in fact).

We had classic playground diversion stuff this week when it was suggested Harawira is the lone electorate MP Kim Dotcom has signed up to his party. It’s not me, sir, Harawira protested – pointing indignantly to the class swot Peter Dunne sitting quietly in the corner. Key of course has rubbished the idea his support partner might be in talks with the Internet pirate who has promised to bring the Prime Minister down. “Not a dog show,” the PM laughed, which prompted a few to remember the Country Calender spoof about the remote controlled sheep dogs, and to ponder Dunne’s resemblance to a slightly affronted Scottish Rough Collie.

Former Labour leader David Shearer – the decent kid  everyone used to pick on – is the other candidate who has been suggested, but this looks even less likely than Dunne. Dotcom has historically held a somewhat awkward relationship with the truth which has occasionally brought him to the attention of the authorities. This looks like another of those occasions. . .

An awkward relationship with the truth, may or may not apply to the 2000 members his Internet Party claims to have.

It’s applied to register as a political party.

. . . Following registration the Internet Party will need to submit its rules providing for the democratic participation of members and candidate selection within the time period specified by law. . .

It’s constitution is here but Russell Brown raises questions on whether they allow for democratic participation by members:

1. There is a special role called ‘party visionary.’ This is defined as Kim Dotcom, or a person selected by Kim Dotcom. THis visionary has the automatic right to sit and vote on the party’s executive and policy committee and cannot be kicked out by the membership.
2. To stand for election to the party’s executive, in addition to being nominated by current members of the party you’ve got to be nominated by a current member of the National Executive. This locks in the incumbents.
3. The party’s executive has nearly unfettered control over the list: they put together an initial list, send it out to the membership to vote on, and then they ultimately decide what the final list should be having regard to the member’s choices.
4. The national executive chooses who stands in what electorate. No local member input at all.
5. The party secretary has a very important role (eg they get to solely arbitrate over disputes; they set out the process for amending the constitution, they decide the process for electing office holders; they’re a voting member of the National Executive). The only problem is they’re legally an employee of the party’s shell company, meaning that it is very hard for the members to exercise democratic control over the secretary (you can’t just fire an employee).
6. On a related note: the way the Internet Party is structured is so all its assets are kept in a shell company (Internet Party Assets Inc), away from the party itself. I don’t know what the purpose of this one was TBH. (the rules of this company were meant to be attached to the constitution in a schedule, but as far as I can see they’re not there)
7. They’re using the old ‘vote in Parliamentary caucus’ decides leader method. To be fair, most parties use this though. There is a bit of a quirk though that until we know their list we don’t know who their party leader is, because if they’re outside of Parliament their party leader is just whoever is at number 1 of the list. (I also note there’s no way to remove a leader if they don’t have representation in Parliament).”

Not so much of, for and by the members as of, for and by Dotcom.

But the silver lining to the Dotcom cloud is that every bit of media attention he’s getting – and he’s getting a lot – is less for the rest of the opposition.

Change in leader not enough for Labour

March 21, 2014

Trans Tasman notes that this week’s poll continuing the dismal trend for Labour confirms that the party needed more than a change of leader.

Labour’s slump in support in the latest poll underlines the party’s problems are more deep seated than can be overcome by a change in leadership. David Cunliffe’s poll ratings are now below those of the man he replaced. But even though anxiety among lower-ranked MPs is growing over their electoral future, there is unlikely to be any fresh moves to change the leadership, despite Shane Jones looking a better bet. The Herald-Digipoll confirmed the trend in other polls, though it’s the first to show Labour below 30%.

The only major changes in the party since it lost the 2008 election are three leaders and rules which can inflict a leader on the caucus without its support.

It is offering almost all the same old stale faces and most of the new policies announced are failed ones from the past.

. . . The significant lesson Labour doesn’t appear to have absorbed is the bulk of voters think the country is heading in the right direction.

The latest poll showed the gap between those who think things are moving in the right direction, and those who do not, expanding from around 3 percentage points to more than 17 points compared with December. Yet this week in Parliament Labour MPs were strumming the theme the present Govt has the worst economic record of any Govt for the last 40 years. They haven’t got the message the Key-led coalition has won the battle on fiscal prudence. And with such a mindset, fresh promises of new spending provoke the opposite response among voters to the one they are seeking. . .

Labour might think the economic and natural disasters since 2008 have been beyond the government’s power. But many voters recognise the difficulties National has faced, the progress it has made in dealing with them and the positive difference it is making.


March 7, 2014

Quote of the day:

. . . Labour couldn’t run a bath – and if they did, it would leak. But would the leak be deliberate or accidental? Who, after the last week, can say? There was a flurry of discussion over whether the leaks about David Cunliffe’s secret trust, and then the Clare Curran email snafu, were on purpose or by accident. Malice or stupidity? There is perhaps a third, blended category: Malicidity. A combination of malice and stupidity, treachery and boneheadedness. . . Trans Tasman

A majority of caucus saddled with a leader they didn’t prefer; fissions and factions within and between caucus and members . . .

It would be a reasonably safe bet that the leaks would be deliberate.

Has accident already happened?

December 3, 2013

Trans Tasman’s annual roll call says this about David Cunliffe:

Due to changes in Labour’s rules managed to pull off the unthinkable and become leader despite many in the caucus not wanting him. He is clever, articulate and a good communicator. Has the potential to be the next PM, but he will only get the one shot. Caucus has no choice but to get behind him. The great fear is he could still  be an accident waiting to happen.

An accident has already happened.

Labour leader David Cunliffe might have fallen foul of the law with a message posted on his Twitter profile on the day of the Christchurch East by-election.

The Electoral Commission is looking into the tweet by Cunliffe on Saturday urging Christchurch East residents to get out and vote for the successful Labour candidate Poto Williams.

“If you are resident in Christchurch East don’t forget to vote today – for Labour and Poto Williams!” he wrote.

Under Electoral Commission rules, no campaigning of any kind is allowed on election day.

The message has since been deleted. Cunliffe yesterday took responsibility for the tweet, saying it was sent in error but was reluctant to explain how. It was “deleted within seconds”.

He said he was not aware of the rules at the time it was sent. He would co-operate with the Electoral Commission if it investigated. . .

It defies belief that a seasoned MP could not be aware of the rules, which aren’t just rules, they are electoral law.

In the National Party the law about what you can and can’t do on election day are drummed into everyone from the newest volunteer to the longest-serving MP. I have no doubt Labour takes the law equally seriously.

He might have forgotten, he might not have thought but ignorance is no defence.

Keeping Stock noticed the tweet and responded:

Whether or not that prompted the deletion of the tweet, it disappeared very quickly.

The Electoral Commission is unlikely to do anything about this given the fleeting appearance of the tweet.

But it does show a lamentable lack of attention to detail on Cunliffe’s part.

That is not not an asset in an aspiring Prime Minister and confirms Trans Tasman’s view of him as an accident waiting to happen.




Bill English politician of year

December 2, 2013

Trans Tasman’s annual roll call of MPs’ performances named Bill English politician of the year.

The star performer, however, is Finance Minister Bill English – he won the title of politician of the year. The judges said it was no contest. . .

This is well deserved.

Prime Minister John Key: Still remarkably popular for a second term PM, but not as bouncy and spontaneous as he was. 8.5/10

Mr English: Politician of the Year: He is restoring the Crown Accounts to surplus, getting the economy “set to fly” and he does more than his fair share of the heavy lifting on policy.

“He and John Key make a formidable team, with English’s intellectual grunt complementing Key’s instinctive political feel.” 9/10

Earthquake Recovery Minister Gerry Brownlee: Being responsible for rebuilding a quake-stricken city would severely test anyone. Frustration showed through as he fielded EQC blunders and dealt with the shortcomings of cumbersome bureaucracies. 7/10

Economic Development Minister Steven Joyce: If it’s too hard for anyone else, give it to Joyce and he’ll fix it. 7.5/10.

The full roll call will be published by Trans Tasman    later today.




Moral fervour

November 13, 2013

Trans Tasman opines:

Moral fervour has its place, but it is something not to be totally trusted. Self righteousness should never be allowed to become mob rule. Society’s norms should be enforced with a degree of legal detachment, lest righteous condemnation be allowed to turn into lynch mob justice.

So it was possible to feel a smidgeon, just a smidgeon, of sympathy for talkback hosts John Tamihere and Willie Jackson this week. They found themselves on the receiving end of a nationwide, social media wide storm of condemnation for their on-air antics in the wake of the “Roastbusters” rape allegations.

But any sympathy should be minimal. The pair are not exactly strangers to these types of  on-air controversies.

Fellow babyboomer broadcaster Bill Ralston  described them, in a friendly way, as some of the last bastions of 1950s male attitudes, but this is hardly an excuse. One would expect the two to have noticed one or two changes since then. Implicit in the way the two questioned one of the rape victims on the air – and also in some commentary elsewhere – is the notion the girls in some way contributed to their predicament.

Now, contributory negligence is a useful concept in civil law, but hardly applies to criminal matters such as rape – unless it is assumed, from the outset, men have as little control as, say, an out of control machine. Tamihere has form in the misogyny area: he famously called women in the Labour Party “front bums.”

Well, now he and his partner are off the air, for acting like a pair of total back bums.


High dollar not all bad

October 28, 2013

The relatively high value of our dollar makes our exports more expensive but Trans Tasman points out it’s not all bad:

. . . The exchange rate is proving a tough obstacle for many exporters, yet the historically high prices for dairy commodities are a key catalyst for NZ’s improving terms of trade. The strong NZD is also keeping a brake on import costs.

ANZ Bank economists say the $64,000 question will be the extent to which the high NZD impacts on the RBNZ’s deliberations. Concerns regarding the currency are one of the motivating factors behind the RBNZ’s decision to broaden its tool-kit. The recent easing in mortgage approvals suggests the high LVR lending speed limits and subsequent lift in fixed mortgage interest rates for such lending are having an impact on borrowing, and hence the residential property market. But the elevated NZD is providing the RBNZ with more breathing space. It could potentially delay rate hikes.

Opposition parties keeping criticising the government for not doing “something” about the value of the dollar.

That their ideas of “something” wouldn’t work and would threaten the independence of the reserve bank doesn’t get in the way of their rhetoric.

They also conveniently overlook the upside of the higher dollar – imports are cheaper.

This doesn’t just apply just to electronic gadgets and trinkets, it also affects essentials like fuel, machinery, some food and medical supplies.

Another benefit of the higher dollar is that it helps keep interest rates down.

Does the Opposition want to explain to the poor people they purport to represent why they want the cost of living and interest rates to increase?

Does Cunliffe prefer NZ First to Greens

October 18, 2013

Green Party co-leader Russel Norman was de facto leader of the opposition while David Shearer led Labour.

Under David Cunliffe the party is lurching to the left, crowding the Greens and leaving them with less of that political oxygen which comes from media exposure.

Trans Tasman makes an interesting observation about this:

There also seems to be a closer rapport between Labour under Cunliffe with NZ First’s
Winston Peters.
This suggests Cunliffe wants to follow Helen Clark’s tactics, when he gets the chance of forming a Govt, of embracing NZ First, and leaving the radical Greens with little choice except to back him from the sidelines. The difficulty with this is Labour’s own policy of raising the age of eligibility for NZ superannuation from 65 to 67. A bottom line for NZ First is no tampering with the age of eligibility for superannuation.
That’s a policy a lot of Labour supporters won’t be happy with either so it wouldn’t be too big a dead rat for Cunliffe to swallow in coalition negotiations if it meant he could leave the Greens out of a coalition.
That would of course depend on Labour being in the position to form a government and the easiest way to prevent that is to keep National in power.

Should single and childless be paid less?

October 11, 2013

If $18.40 is considered to be a “living wage” for a family, should the single and childless be paid less?

Trans Tasman says:

Employers and Manufacturers Association CEO Kim Campbell has exposed fundamental flaws in the campaign launched by the Anglican Family Centre for a so-called “living wage.” The Anglican proposal of $18.40 gross per hour applies to an average family of 2 adults and 2 children, with one adult working fulltime and one working half-time. Their pay at this rate includes Govt payments such as Working for Families, accommodation supplements, and childcare assistance. Campbell says on this basis many people whose pay is currently based on $15 or $16 an hour already qualify as receiving a “living wage.”

Other groups appear to back the payment of $18.40 gross an hour with the welfare and support payments paid as well. If the top-ups are included the “average family” would receive the equivalent of over $20 gross an hour each. Another fundamental problem with the system proposed by the Anglican Family Centre for low paid workers being paid according to their family circumstances is totally different from the way everyone has been paid for their work.

“People are paid for their work, not for the size of their family. If $18.40 an hour was set as the right amount for a family of 4 with 1½ pay packets, a different rate would be needed for, say, a family of 6 with 1 pay packet, or a 2-person-2 income household, or a single person with 2 jobs. Calculating the many different ‘living wages’ would be a nightmare.” . . .

It would be iniquitous to pay people less because they needed less to support the sort of lifestyle a ‘living wage’ is predicated on.

But is it any better to pay people more than the job they do is worth because their needs, which have nothing at all to do with their work, are greater?

New Zealand would be better off if all wages and salaries were higher but increases must be based on what the work is worth not an artificial construct of what’s needed.

Patience might pay

October 11, 2013

When an issue becomes a big issue emotion often clouds the facts.

This has happened with housing affordability and the general acceptance that it’s a problem if first home buyers can’t by the type of house they want at a price they can afford.

Trans Tasman brings some much needed cool reason to the debate:

There are a few things – awkward, intractable and occasionally unpleasant things – being forgotten in the current wave of handwringing about house buying. The first and most basic is supply and demand: if supply of something drops, or demand for it rises, the price will generally go up. If they happen at the same time – as with the Auckland property market right now – silly things happen.

The last housing boom/bubble wasn’t driven by supply issues. In fact the construction sector was dashing from site to site like water trucks in the Sahara. There was also hell of a lot of speculative trading going on – a top tax rate of 39% and tax breaks for depreciation and LAQCs will do this for you. This vanished in 2009-10 but so did construction. Residential property investment is now 23% below 2007 levels.

A final, crucial and awkward truth. Young Kiwis who can barely scrape together a deposit right now are better off waiting. Not only interest rates but also inflation are their lowest for 50 years and will rise over the next three years. Insurance and rates – which tend to catch first home buyers by surprise – are rising by 10% or more. And a house-building programme of the kind being launched right now could see house prices fall.

By 2015-16, we could easily be seeing negative equity plus a rash of mortgagee sales as today’s cheap fixed rate mortgages end and jump a couple of percent. All the new Reserve Bank restrictions require is the scraping together of a larger deposit. It ain’t such a bad idea at the moment.

Patience is a virtue and it might well pay when it comes to house buying.

Interest rates won’t stay as low as they are now and other costs will rise which could make it very difficult for people to service large mortgages.

If they’ve borrowed most of the money for their purchase it will take only a small drop in property prices to push them into negative equity.

It’s not that long ago that most people wouldn’t have dreamed of going to a bank until they had a sizeable deposit.

A return to that mind-set would take some heat out of the market and make eventual purchases much more secure.

Why all the fuss

July 5, 2013

The media fascination about Kim Dotcom has bemused me.

I’m pleased to find that Trans Tasman is similarly unimpressed:

You could fire a shotgun down the corridor of Parliament’s press gallery offices on Wednesday afternoon and not hit anyone. Not, one hopes, you would want to do such a thing, although it is possible the thought brings a gleam to the eye of more than few MPs.

But most of the gallery media team was crammed into a committee room waiting for the Man of the Decade, Kim Dotcom Superstar, to make his appearance.

Dotcom managed to walk in, like a normal mortal, rather than appear in a puff of smoke, manifest himself in a burning bush, or be beamed down like some character from science fiction. Which was disappointing, in its way. It wasn’t the only disappointment.

The panting enthusiasm for Dotcom and all his works takes a great deal of explaining… no: actually, it is beyond explanation. The hope was, of course, the internet entrepreneur and convicted fraudster would appear before the Intelligence and Security Select Committee and say rude things about the Prime Minister.

As it is not too difficult to find people to say rude things about the Prime Minister, it was never clear just what the big deal was. Hell, most of the media write or broadcast rude things about the Prime Minister on an almost daily basis. If Dotcom had any revelations to make it would have been different but of course he doesn’t know any more than any of us: only he was spied on and he is not happy about it.

He was rather keen on democracy, and not keen on the GCSB, he told MPs. The most exiting events of the hearing were the Dotcom Megastar sweated: the Prime Minister blushed.

Neither is really worth making headline news.

I think this is the first time I’ve written a post about Dotcom because I’ve been unable to find anything that justifies one except the question of why the media has given him so much attention.

Could they organise a booze up in brewery?

June 27, 2013

If you’ve ever wondered whether politicians could organise a booze up in a brewery, wonder no more.

Trans Tasman has the answer:

Top Town Goes Political
TVNZ’s Heartland channel is looking at re-invigorating the old “Top Town” competitions, and invited all political parties to take part in a pilot show during the recent recess. MPs only had one task: to organise a booze up in a brewery.

Trans Tasman obtained a copy of the judges’ report.

National: Got booze-up sorted by doing deal with one of the breweries. Floated 49% of booze on sharemarket but what was a good craft beer at time of float fell in value and became Fosters and Joseph Khutz lager.

Labour: Women’s and Rainbow factions opposed the notion of ‘booze-up’ as heterosexist and patriarchal. MPs opposed a brewery in principle and then accepted invitation to the opening anyway. David Shearer popped in for five minutes and had a shandy.

Greens: Eyes lit up at the word “organise” – Greens LOVE organising things – but lips curled at “brewery.” Settled for small organic vineyard in Nelson where members gathered to work out how to exempt it and other Green businesses and landholdings from the capital gains tax which will go on all other businesses.

ACT: Organised booze up well, but no one came.

NZ First: Despite much natural talent, failed to perform. Raised continual points of order with judges, somehow obtained other parties’ team plans and leaked them to media.

United Future: Peter Dunne was unwise, even stupid. Disqualified.

Maori Party: Booze up in brewery went extremely well until someone asked Tariana Turia if they could smoke. Everyone then decamped to National booze up, where Maori Party MPs helped out by laying out the welcome mats.


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