Word of the day

Ait – an islet; a small island in a lake or river typically formed by the deposit of sediment in the water, which accumulates over a period of time; a braid bar.

Sowell says

I cannot understand people who say that minorities should be represented everywhere and yet are upset when there are blacks represented in the conservative movement.

— Thomas Sowell (@ThomasSowell) November 3, 2020

Rural round-up

Rural water users challenge Kaikōura council plans to treat their water :

Water supply users say the Kaikōura District Council should have talked to them before coming up with expensive plans to treat their bore water.

Like councils around the country, the council is upgrading water supplies to meet the New Zealand Drinking Water Standards before the government’s new water regulator Taumata Arowai takes over next year.

Council operations manager Dave Clibbery has recommended splitting the East Coast scheme in two, building a $100,000 treatment plant for Clarence and having farms switch to rainwater for domestic use, at their own expense.

The East Coast scheme supplies 21 rural properties and 13 households in Clarence village, with the bulk of the water used for stock. . . 

Horticulture NZ keen to work with new government:

Horticulture New Zealand – which advocates for New Zealand’s 6000 plus fruit and vegetable growers – is keen to work with the new Government to ensure the industry can continue to grow and support New Zealand’s post-Covid economic and social recovery.

‘New Zealanders have spoken strongly and provided the new Government with a significant mandate,’ says HortNZ President, Barry O’Neil.

‘We’re keen to continue to work constructively with Minister Damien O’Conner, including in his new role as Trade and Export Growth Economic Minister. We want to ensure the horticulture industry is enabled to grow in line with Fit for a Better World, while at the same time responding to its environmental and climate change obligations.

‘In 2019, the New Zealand horticulture industry was worth more $6.39 billion and has grown by 64% in the past ten years. That is thanks to industry innovation and grower investment in new varieties and growing techniques to stay ahead of international competition and respond to consumer preferences. This growth is also because the industry is a sustainable user of land.’ . .

Gotta love a nice line of Angus Friesain Steers. These guys are off to Taihape at the end of the week. #dairybeef@WilliamBeetham @Lewisridge_Farm @MooreBnmoore @goaheadfarms pic.twitter.com/kmJ3BrP8Ib

— Richard McIntyre (@rmcintyre007) November 9, 2020

Jager backs sheep milk industry – Gerald Piddock:

Can the Zespri business model work for New Zealand’s sheep milking industry? Its former chief executive Lain Jager believes it can.

If successful, it would transform the industry into a billion-dollar industry that delivered for its farmers, Jager told around 400 people at Spring Sheep Milk Company’s annual open day held on a farm near Cambridge.

Jager is one of Spring Sheep’s directors and is also chair of the Primary Sector Council.

In 2015, Spring Sheep chief executive Scottie Chapman approached Jager about wanting to copy the Zespri model to develop a NZ sheep milking industry. . . 

Sale hammer falls on large-scale central North Island Ata Rangi Pastoral dairying venture – Andrea Fox:

Ata Rangi Pastoral, a large-scale central North Island dairying venture which aimed to show how sustainable, pasture-based production was done, has turned sour, with the last properties sold last week under the auction hammer.

Ata Rangi Pastoral was registered in 2015, to establish, by conversion, five dairy units and one dry-stock, or dairy support, farm on a swathe of forested land north of Taupo, stretching from Whakamaru to Tokoroa.

Founding shareholders New Zealanders Brent Cook and Ged Donald were reported at the time to be aiming to be the standard-bearer for sustainable, pasture-based production in New Zealand. The pair returned the land to New Zealand ownership, purchasing it from a US investment fund. . . 

Nothing beats milking elite jersey cows:

Sophia Clark didn’t think she would end up a dairy farmer but a season milking Jersey cows showed her that a career in farming could deliver both a business and a lifestyle.

Sophia and her partner Aaron Mills are 50/50 sharemilkers for Bernie and Gaye Hermann at Paengaroa, near Te Puke, where they milk a herd of 550 elite Jersey cows.

Sophia says the herd, which is in the top 1% of herds across all breeds based on breeding worth (BW), is perfectly suited to the farm. “We are a hilly farm, running a lower input system and milking once-a-day over summer.

Jerseys are well suited to our operation and enable us to farm the way we want to farm – not too much time spent on the tractor or too many bells and whistles – just a simple, efficient, profitable system.” . . .

A misty morning in Vacy pic.twitter.com/NJglXaSgNc

— David Williams (@david_vacy) November 9, 2020

Defending Beef The Case for Sustainable Meat Production :

For decades it has been nearly universal dogma among environmentalists and health advocates that cattle and beef are public enemy number one.

But is the matter really so clear cut? Hardly, argues environmental lawyer turned rancher Nicolette Hahn Niman in her new book, Defending Beef.

The public has long been led to believe that livestock, especially cattle, erode soils, pollute air and water, damage riparian areas, and decimate wildlife populations.

In Defending Beef, Hahn Niman argues that cattle are not inherently bad for either the Earth or our own nutritional health. In fact, properly managed livestock play an essential role in maintaining grassland ecosystems by functioning as surrogates for herds of wild ruminants that once covered the globe. Hahn Niman argues that dispersed, grass-fed, small-scale farms can and should become the basis for American food production, replacing the factory farms that harm animals and the environment. . . 

Yes Sir Humphrey

The ideal Quango appointee is a Black, Welsh, disabled woman Trade's Unionist. We're all looking around for one of them.

— Sir Humphrey Appleby (@YesSirHumphrey) November 1, 2020

Des O’Connor 12.1.32 – 14.11.20

English comedian, singer and television present Des O’Connor has died.

Des O’Connor once said that all he did was walk on to the stage, chat to the audience and sing a few songs.

It was a formula that made him one of Britain’s best-known stars, an old-fashioned showman who could turn his hand to almost anything – fronting his variety programme, hosting chat shows or presiding over the quiz Countdown.

An almost ever-present face on UK television, he held the record for more mainstream appearances on the small screen than any other performer.

O’Connor, who has died aged 88 after a fall at his home in Buckinghamshire, also carved out a successful career as a singer including four Top 10 hits and more than 30 albums.

Desmond Bernard O’Connor was born on 12 January 1932 in Stepney, East London, the son of a Jewish cleaner and an Irish dustman. He contracted rickets while he was a child which resulted in him having callipers on his legs until he was seven.

He was also badly injured in a car accident and spent some time in an iron lung which disrupted his primary school education.

During the war, the family moved to Northampton where he signed as a schoolboy player with Northampton Football Club although he only made the third team.

It was while working in a local shoe factory that he discovered a talent for making people laugh, once recalling his ability to reduce the firm’s typing school to giggles and to be the main source of entertainment on works outings.

His prowess as a performer came to the fore during his national service with the RAF, when his commanding officer insisted he take part in a talent show. . .

Money supply fuelling house prices

Friends on Waiheke Island took us to visit friends of theirs who were selling their house on a 900 square metre section.

The asking price was $500,000.

“How many stock units could you run on the lawn?” my farmer asked, knowing at the time we were buying a neighbour’s farm of about 120 hectares with a house and wool shed for less than that.

Town and country property prices have gone up a lot in the two decades since then. House prices increased nearly 20% in the last year.

The steep climb is largely a function of supply and demand. There are far fewer houses for sale than there are buyers in the market.

Immigration has plummeted so we can’t blame that.

We can point some of the blame at the national lockdown in March and the more recent Auckland one that put a dampener on new builds, adding to the delays and costs caused by the RMA and building regulations.

But David Law at the New Zealand initiative says loose monetary policy is the bigger culprit.

. . . The Reserve Bank is undertaking a $100 billon programme of quantitative easing. The Official Cash Rate (OCR) is also now at a record low, reduced from 1% to 0.25% in March. These two decisions alone will lift returns on investment in housing and increase pressure on house prices, particularly as supply is constrained.

If the Government cares about fixing housing affordability, it should start by being clear on the reasons for those high prices.

Former Finance Minister Steven Joyce is also concerned about housing for the haves and no relief for the have nots:

. . . People can afford the repayments on a bigger mortgage so they bid up the sticker price on the house, while others look for any sort of asset yield that’s bigger than the derisory amounts available from bank deposits.

There is now much more recognition that ultra-low interest rates are driving high asset prices including house prices, but so far much less will to do anything about it. . . 

The Prime Minister has shown concern and said prices can’t keep going up at the rate they have been but her concern hasn’t translated into any practical solution to the problem/

Covid-19 is the big driver of the current economic recession, but the government’s policy response isn’t helping.

By continuing to invoke lockdowns at the drop of a hat, mandating big minimum wage and public sector pay increases, pursuing the adoption of the so-called living wage, increasing holiday pay and pushing myriad other anti-employment measures, there is no doubt that the economy will respond with more sluggish employment growth than would otherwise be the case.

In turn monetary policy has more work to do to maintain progress towards the full employment goal. Say hello to even lower interest rates for longer; and ever more nonsensical asset prices, especially houses.

It is a big irony that government policies that often seek to boost the fortunes of the low paid end up helping to trap them in a hand to mouth existence, with no way to break the cycle and get on the home ownership ladder. . . 

Worse, higher house prices lead to higher rents which makes it harder for low income renters to make ends meet and for higher income renters to save for a deposit to buy a home.

The simple fact is that under current policy settings, micro-economic policies that attempt to artificially boost incomes beyond what businesses and the economy can afford will simply end up driving a bigger wedge between the haves and the have nots in terms of asset prices and wealth, through the mechanism of ever lower interest rates. We are chasing our tails.

Anything which increases the supply of money and lowers the cost of borrowing without increasing the supply of houses will drive up prices.

The Reserve Bank is trying to stimulate the economy by encouraging businesses to invest and expand but government-mandated increase in wages and sick leave have the opposite affect.

And any positive impact from the lower OCR is more than outweighed by the inflationary pressure low interest rates are putting on house prices.

The house we looked at on Waiheke Island would be selling for far more than $500,000 now. The farm we bought has increased in value too but it’s a productive asset supporting jobs and earning export income.

A house provides a home but it produces nothing and the rampant price increases of owning one is producing misery.