Word of the day

September 1, 2011

Ergasiophobia –  an abnormal and persistent fear (or phobia) of work, finding work or functioning;  aversion to work; diffidence about tackling a job;


September 1, 2011

Yet more proof I don’t pay much attention to sports news: just 4/10 in the NZ Herald’s sports quiz and three of those were guesses.

Tech tantrum

September 1, 2011

The one day I don’t take the precaution of emailing drafts to myself so I can retrieve them from other computers is the day we get a couple of techies in to do some work.

They did the work and left.

Now when you phone us you get the fax and the only copy of the column I’ve written is sitting on a computer that will receive but not send as deadline approaches.

If it wasn’t for the influence of my mother I’d be saying some very bad words right now.

Thursday’s quiz

September 1, 2011

1. Who said: “Twenty years from now you will be more disappointed by the things that you didn’t do that by the ones you did do. So throw off the bowlines. Sail away from the safe harbour. Catch the trade winds in your sails. Explore. Dream. Discover.”?

2. Who is the author who wrote Cut and Run and Slaughter Falls under the pseudonym Alix Bosco?

3. It’s miel in French and Spanish, miele in Italian and honi or miere in Maori, what is it in English?

4. Who was Piglet’s grandfather?

5. Which teams met for the Bronze final in the 2007 Rugby World Cup?

The essence of being a New Zealander

September 1, 2011

The more I travel or meet visitors from overseas here the more I realise there are usually more things which unite people from different countries than divide us.

That said, there are characteristics which make each nationality distinctive.

Some are physical, and I don’t just mean obvious genetic factors like skin colour.

The people we saw on the streets of Singapore during a stop-over looked very different from the mainly European, African, Middle Eastern and British people we’d been with for three and a half months in Spain. Among them I saw a couple walking towards us and long before I heard them speak I said to my farmer, “I bet they’re Kiwis.”

There was something about the way they walked and the way they were dressed which was familiar. Their accents, overheard as they passed us, proved me right, my ears confirming something my eyes had already recognised.

If there are physical characteristics, there is also a national character. Lt Gen Rt Hon Sir Jerry Mateparae summed up ours in the speech at his swearing in as Governor General yesterday:

What I identify as the essence of being a New Zealander was put neatly by Sir Edmund Hillary when he said that “In some ways I believe I epitomise the average New Zealander: I have modest abilities, I combine these with a good deal of determination, and I rather like to succeed.” As a people, New Zealanders are in equal measures informal, strong-willed, competitive and yet also modest about all we have achieved. We have a strong sense of community, where public-spiritedness is appreciated and valued. We are inclined to be considerate and prepared to lend a helping hand to those in need. Yet we also like to get on and do stuff – we admire individual ingenuity and those who have a sense of adventure.

 We might not all be as good as this, but it is something towards which we can aspire.

On-line calculator unbundles milk price

September 1, 2011

The price of milk and Fonterra’s role in setting it is the subject of on-going debate and will now be investigated by a Select Committee.

The ValueAdd Company has done a lot of the work for them and has beaten them to the unbundling.

They’ve used the information they’ve found to provide  an on-line calculator which shows the cost components of milk production.

The calculations, which are based on some guesstimates, show the retail price includes mark-ups of 12% by Fonterra, 15% by wholesalers and 30% by retailers.

In a media release the company explains its calculations and concludes:

We built up other information from the referenced sources and our calculations came to the somewhat surprising conclusion that for the year ended 30 June 2011, a forecast payment to suppliers for milk of $8.00 per kg of milk solids (not yet finalised) would be $2.73 or 51.7% greater than the figure required to produce a break-even net margin on exported commodity products.

I am not sure why that is surprising.

It has been a particularly good year for commodity prices and the payout to farmers will reflect that and help make up for a couple of seasons ago when most dairy farms posted losses.

Dividends to NZers better than interest to foreigners

September 1, 2011

Quote of the week from  Finance Minister Bill English:

“We would rather pay dividends to New Zealanders than interest on rising debt to foreigners.”

The government need to invest more in schools, hospitals, roads  and other infrastructure.

It could pay for that by an  increase our already heavy borrowing from overseas or it could sell minority interests in a few of the many companies it owns.

Increasing borrowing will put pressure on interest rates and make the country more vulnerable to rough global waters.

Selling minority shares in four energy companies and Air New Zealand will provide investment opportunities for individuals, Iwi and institutions like ACC, community trusts and superannuation funds.

Some shares could also be bought by foreigners and there are benefits in that, but New Zealanders will still have a majority shareholding:

Overseas investors will play a role in helping to get a good price for taxpayers. They will also help deliver a robust and liquid market for New Zealanders.

But it’s important to remember that these companies will remain firmly – and overwhelmingly – in New Zealand control.

In total, we expect that across the programme New Zealanders will own at least 85 to 90 per cent of these companies – including the Government’s cornerstone shareholding.

There are solid reasons for expecting such strong domestic support for these shares. For example:

  • New Zealand retail investors currently have $105 billion sitting on the sidelines in term deposits, $108 billion in financial assets and between $100 billion and $150 billion of investment property. This adds up to total investments of over $300 billion, excluding their own homes.
  • The 34 registered KiwiSaver providers have about $9 billion invested and will double in size over the next four years.
  • New Zealand institutions (excluding KiwiSaver funds) have $59 billion under management.
  • Government CFIs (including the NZ Super Fund, ACC and GSF) have almost $40 billion under management.
  • Iwi are estimated to have over $10 billion of assets.

So the mixed ownership programme is small compared with the size of the local capital pool.

New Zealanders are also telling us they are hungry for other investment options, particularly with the shine having come off the investment property and finance company sectors.

This has been apparent in the strong domestic demand for corporate bonds. More than $11 billion of non-government debt has been issued over the past two years alone. Many INFINZ members will have participated.

What’s more, lower wholesale interest rates and a reduced demand for highly-geared property reinforce this appetite.

The government will free up $5 to $7 billion – about 3 per cent of its current assets – to invest in other infrastructure without having to borrow more and there are other benefits:

The mixed ownership model will improve the balance sheets of both taxpayers and investors, bring better commercial discipline to the companies concerned, and provide them with easier access to capital to grow.

It will also enable some of our bigger institutions to invest more in New Zealand and give individuals far safer places to invest money than dodgy finance companies.

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