Rock star economy will play encore

July 21, 2015

Opposition is a dark place where good is bad and bad is good.

While they’ll never admit it, oppositions can’t really enjoy good news for fear it’s good for the government and  threatens their relevance and they  take a perverse pleasure in bad news in the hope that it will be bad for government and good for them.

That’s why  opposition MPs have been doing their best to talk down the economy and doing a Chicken Little the-sky-is-falling as they over-emphasise the negative impact the sharp decline in dairy prices will have.

Only those who hate dairying and financial success will be happy about the price of milk and low payout, but while dairying is important, there is more to the economy than that and talk of recession is, thankfully, misplaced pessimism.

Growth is slowing but an HSBC economist says  New Zealand’s rock star economy will play an encore cheered on by Chinese consumers.

HSBC co-head of Asian economic research Frederic Neumann said while China’s economy was slowing, along with many other Asian nations, the outlook for New Zealand was still strong.

“The rock star economy will still keep on playing because you guys [New Zealand] are in a sweet spot in terms of having the products that China has an insatiable appetite for,” Neumann said.

In 2014 Neumann’s colleague HSBC chief economist for Australia and New Zealand Paul Bloxham referred to New Zealand as a rock star economy.

However the title has been brought into question recently as gross domestic product growth slows, dairy prices slump, business confidence slips, the dollar falls and Auckland’s heated housing market continues to set records.

But Neumann said New Zealand was simply going through a rebalancing phase, moving away from a commodity dependent economy.

“After years of an overvalued exchange rate you need to have a considerable period of an undervalued exchange rate to get that rebalancing process going.”

Neumann said even if New Zealand did remain reliant on soft commodities that was not a major concern because demand for high quality food from Chinese consumers would grow much faster than the Chinese economy.

“That should be a positive for New Zealand so I’m not terribly worried for the dairy sector or the meat sector over time.” . . .

It’s not hard to find examples of people in difficulty in the best of times and some people are struggling but New Zealand as a whole is not.


Rural round-up

January 21, 2015

Action needed now to minimise drought losses:

Farmers need to act now if they are to cope with the effects of a predicted drought in Canterbury, Lincoln University experts say.

But they also need to be thinking long-term with more dry-spells looking likely.

Chris Logan, Animal Programmes Manager at Lincoln University, says it seems the region may be in for a hard drought of a kind which has not been seen for some decades. . . .

 HSBC says global dairy prices should recover:

HSBC’s economists are expecting global dairy prices will start recovering from current lows, largely because of a sharp run-down in Chinese dairy imports.

Paul Bloxham, HSBC’s chief economist in Sydney, said Chinese imports had dropped to seemingly unsustainably low levels.

He said once China begins buying again, prices should at least partly rebound.

Global Perspective Will Help NZ Agribusiness Grow:

An agribusiness symposium with a global focus will help New Zealand businesses continue to develop their production, marketing and logistics skills to grow sales and exports.

That’s the view of agribusiness consultancy, AbacusBio that is underwriting the second Queenstown Agribusiness Symposium in March 2015.

AbacusBio partner, Anna Campbell says after attending the Harvard Agribusiness Executive Seminar in China a few years ago, the company was inspired to organise a comparable event locally so more New Zealand businesses could benefit from the learnings and networking.

The three–day program is facilitated by the Director of Harvard Business School’s Agribusiness Program, Mary Shelman and Professor of Marketing and Associate Dean at UCD Michael Smurfit Graduate Business School, Ireland, Prof. Damien P. McLoughlin, who bring an international perspective, she says. . .

ANZ announces assistance package for farmers affected by Big Dry:

ANZ today announced an assistance package for farmers affected by extreme dry conditions across much of New Zealand’s east coast.

Many areas, including Canterbury, have experienced “severely dry” conditions over the past two months compared with the long-term average, according to Niwa.

“The Big Dry is affecting areas which haven’t experienced extreme conditions like these for many years, so for a lot of farmers this is new territory,” said Graham Turley, ANZ Bank’s Managing Director Commercial & Agri. . .

 

David Jones explains why the red meat sector growth targets are not likely without major reform, and what should be done in 2015 with a sector ‘unable to help itself:

Currently, over 80% of our agricultural produce is shipped offshore each and every year, and over the next decade the sector has big ambitions to double export earnings to $64 billion.

The Red Meat Sector Strategy (RMSS), launched by the Meat Industry Association of New Zealand in May 2011, hopes to achieve growth in the sector of $3.4 billion NZD by 2025, across all parts of the value chain.

The three key influences focused under RMSS are:

• Improving how and what we sell in overseas markets

• Aligning procurement between farmers and processors .

• Adopting best practice production and processing . . .

Economists to discuss challenges of feeding a growing planet . . .

A world perspective on the short and long run impacts of food price changes on poverty will be up for discussion at a major international economics conference in Rotorua next month.

The World Bank’s, Dr Will Martin, will lead the discussion on food price changes and poverty as part of a session on challenges in the agrifoods sector at the 59th Australian Agricultural and Resource Economics Society’s (AARES) annual conference being held in Rotorua from February 10 to 13.

Dr Martin is manager for agricultural and rural development in the World Bank’s Research Group and president-elect of the International Association of Agricultural Economists. His recent research has focused primarily on the impacts of changes in food and trade policies and food prices on poverty and food security in developing countries. His research has also examined the impact of major trade policy reforms-including the Uruguay Round; the Doha Development Agenda; and China’s accession to the World Trade Organisation. . .

 Farmers urged to watch for yellow bristle grass:

 Horizons Regional Council is urging farmers to keep an eye out for yellow bristle grass, an invasive summer weed that spreads rapidly through pasture causing a loss in production.

 Horizons environmental programme coordinator plant security Craig Davey says the grass is already affecting farming in Waikato and is easily transferred from roadside infestations, via stock movement and infested hay.

“Like a lot of weeds, yellow bristle grass is quick to colonise bare ground. Hot, dry conditions, poor machinery hygiene practices and spraying to bare earth can all exacerbate its spread,” Davey says. . .


NZ will be rockstar in 2014

January 7, 2014

New Zealand’s economic growth has been recognised by HSBC:

New Zealand will be the “rockstar” economy of 2014, with growth set to outpace most of its developed markets peers, according to HSBC, a stark contrast with neighboring Australia, which is struggling to maintain economic momentum.

“We think New Zealand will be the rockstar economy of 2014. Growth is going to pick up pretty solidly this year,” Paul Bloxham, chief economist for Australia and New Zealand at HSBC told CNBC Asia’s “Squawk Box” on Monday.

(Read more: Rate hike talk boosts New Zealand dollar)

HSBC forecasts the economy will grow 3.4 percent in 2014 – the fastest pace since 2007 and well above trend growth of 2.5 percent. For 2013, the economy is expected to post growth of 3.0 percent, according to the bank.

There are three key factors supporting faster expansion, said Bloxham.

The first is spending on construction, including the rebuilding of Canterbury region that was ravaged by an earthquake in February 2011. “There’s an enormous amount of construction that’s going into building that region of the economy,” he said.

Reconstruction spending is not expected to peak until 2017, and should continue to boost the economy for some time, Capital Economics wrote in a recent note.

(Read more: We can’t influence ‘currency war’: New Zealand)

The second driver is the country’s housing boom that has been fueled by low interest rates and a wave of net immigration over the past year.

While the Reserve Bank of New Zealand (RBNZ) tightened rules around home loans in October and is likely to begin hiking rates in the coming months, economists expect residential investment will remain robust.

The final factor is rising dairy prices – driven by strong demand out of China – which is supporting rural incomes, noted Bloxham. New Zealand is the top dairy exporter accounting for around a third of the world’s trade in dairy products. . . 

Tempering the good news are concerns about slowing down in the economies of our two biggest trading partners, China and Australia, and the probably increase in the value of our dollar.

. . . Nevertheless, many investment strategists recommend betting on assets that are set to benefit from the country’s economic surge – in particular the New Zealand dollar, informally known as the kiwi.

Kathy Lien managing director of BK Asset Management, for instance, has identified the kiwi, as the “hottest” currency of 2014.

(Read more: This could be the hottest currency trade of 2014)

“Of all the major currencies our favorite is the New Zealand dollar because in addition to talking about raising interest rates this year, the Reserve Bank also laid out a plan to bring rates from the record low of 2.5 percent to 4.75 percent by the first quarter of 2016,” Lien wrote in a note last week.

“No other major central bank is as hawkish as the RBNZ and with a high and growing yield, the New Zealand dollar should attract a significant amount of investment this year. What makes New Zealand dollar even more attractive is that demand will be supported by growth,” she added.

A higher dollar makes exports less competitive and makes travelling here more expensive for tourists.

But it also maintains the value of earnings and savings and keeps the price of imports lower – that’s not just luxuries but necessities like fuel, medical supplies, vehicles, building materials and machinery and it reduces imported inflation.


March 3 in history

March 3, 2010

On March 3:

1284 The Statute of Rhuddlan incorporated the Principality of Wales into England.

1575 Indian Mughal Emperor Akbar defeated Bengali army at the Battle of Tukaroi.

 
Akbar1.jpg

1776 The first amphibious landing of the United States Marine Corps began the Battle of Nassau.

Battle of Nassau.jpg

1585 The Olympic Theatre, designed by Andrea Palladio, is inaugurated in Vicenza.

 

1803 Colégio Militar is founded in Portugal by Colonel Teixeira Rebello.

 

1805 Jonas Furrer, first President of the Swiss Confederation, was born.

1820 The U.S. Congress passed the Missouri Compromise.

1831 George Pullman, American inventor and industrialist, was born.

1845 – For the first time the U.S. Congress passed legislation overriding a presidential veto.

1847  Alexander Graham Bell, Scottish-Canadian inventor, was born.

1849 – The U.S. Congress passed the Gold Coinage Act allowing the minting of gold coins.

1857 Second Opium War: France and the United Kingdom declared war on China.

Upper North Taku Fort.jpg

1865 – Opening of the Hongkong and Shanghai Banking Corporation, the founding member of the HSBC Group.

The Hongkong and Shanghai Banking Corporation Limited
香港上海滙豐銀行有限公司

1873 The U.S. Congress enacted the Comstock Law, making it illegal to send any “obscene, lewd, or lascivious” books through the mail.

 

1875 Georges Bizet‘s opera Carmen received its première at the Opéra Comique of Paris.

            

1875 – The first ever organized indoor game of ice hockey was played in Montreal.

 

1878 Bulgaria regained its independence from Ottoman Empire according to the Treaty of San Stefano.

1879 The United States Geological Survey was created.

US-GeologicalSurvey-Seal.svg
Seal
USGS logo green.svg

1882 Charles Ponzi, Italian fraud convict, was born.

1885 The American Telephone and Telegraph Company was incorporated in New York.

Att-logo.png

1893 Beatrice Wood, American artist and ceramicist, was born.

 

1904  Kaiser Wilhelm II of Germany became the first person to make a sound recording of a political document, using Thomas Edison‘s cylinder.

1905 Tsar Nicholas II of Russia agreed to create an elected assembly, the Duma.

 

1910 Rockefeller Foundation: J.D. Rockefeller Jr. announced his retirement from managing his businesses so that he can devote full time to being a philanthropist.

Rockefeller Foundation logo.png

1911 Jean Harlow, American actress, was born.

1915  NACA, the predecessor of NASA, was founded.

NACA seal.jpg

1918 Germany, Austria and Russia signed the Treaty of Brest-Litovsk ending Russia’s involvement in World War I, and leading to the independence of Finland, Estonia, Latvia, Lithuania and Poland.

 Leon Trotsky being greeted by German officers in Brest-Litovsk

1920 Ronald Searle, British illustrator, was born.

 

1923 TIME magazine is published for the first time.

 

1924 The 1400-year-old Islamic caliphate was abolished when Caliph Abdul Mejid II of the Ottoman Empire was deposed.

1924 – The Free State of Fiume was annexed by Kingdom of Italy.

1930 Ion Iliescu, President of Romania, was born.

1931 The United States officially adopted The Star-Spangled Banner as its national anthem.

 The 15-star, 15-stripe “Star Spangled Banner Flag” which inspired the poem.

1938 Oil was discovered in Saudi Arabia.

1939 In Mumbai, Mohandas Gandhi began to fast in protest at the autocratic rule in India.

 

1940 Five people were killed in an arson attack on the offices of the communist newspaper Norrskensflamman in Luleå, Sweden.

1942 Mike Pender, English singer and guitarist (The Searchers), was born.

1942 Ten Japanese warplanes raided the town of Broome, Western Australia killing more than 100 people.

1943  173 people were killed in a crush while trying to enter an air-raid shelter at Bethnal Green tube station in London.

1948 Snowy White, British guitarist (Thin Lizzy, Pink Floyd), was born.

1953 A Canadian Pacific Airlines De Havilland Comet crashed in Karachi, killing 11.

1958 Miranda Richardson, British actress, was born.

1958 Nuri as-Said became the prime minister of Iraq for the 14th time.


Faisal II with Nuri as-Said.

1960 Barry Crump’s novel A Good Keen Man  was published.

Barry Crump's novel <em>A good keen man</em> published

1961 Hassan II became King of Morocco.

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1964 Duncan Phillips, Australian drummer (Newsboys), was born.

1969  NASA launched Apollo 9 to test the lunar module.

Apollo-9-patch.png

1971 Beginning of Indo-Pakistani War of 1971 and India’s official entry to the Bangladesh Liberation War in support of Mukti Bahini.

1971 surrender.jpg

1972 Mohawk Airlines Flight 405 crashed as a result of a control malfunction and insufficient training in emergency procedures.

1974  Turkish Airlines Flight 981 crashes at Ermenonville near Paris,  killing all 346 aboard.

1976 Five workers were killed by the police in a demonstration in Vitoria-Gasteiz, Spain.

1985 Arthur Scargill declared that the National Union of Mineworkers national executive voted to end the longest-running industrial dispute in Great Britain without any peace deal over pit closures.

NUM logo.png

1991 An amateur video captured the beating of Rodney King by Los Angeles police officers.

 

1991 – In two concurring referendums: 74 % of the population of Latvia and 83% of the population of  Estonia voted for independence from the Soviet Union.

1991 United Airlines Flight 585 crashed on approach into Colorado Springs, killing 25.

1992 – The nation of Bosnia was established.

1997  The tallest free-standing structure in the Southern Hemisphere, Sky Tower in downtown Auckland opened after two-and-a-half years of construction.

Sky Tower Collage Auckland.jpg

2002  Citizens of Switzerland narrowly voted in favor of their country becoming a member of the United Nations.

2004  Belgian brewer Interbrew and Brazilian rival AmBev agree to merge in a $11.2 billion deal that formed InBev, the world’s largest brewer.

2005 James Roszko murdered four Royal Canadian Mounted Police constables during a drug bust at his property in Rochfort Bridge, Alberta, then commits suicide.

2005 Steve Fossett became the first person to fly an airplane non-stop around the world solo without refueling.

2009  The Sri Lankan cricket team was attacked by terrorists while on their way to the Gaddafi Stadium, Lahore for a Test match against Pakistan.

2009 – The building of the Historisches Archiv der Stadt Köln (Historical Archives) in Cologne, Germany, collapsed.

 

Sourced from NZ History Online & Wikipedia


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