Luxon jumps on anything and everything - I wouldn't read anything into that.
A review would be good (and the RBNZ is doing so) so long as it is about learning rather than blame.
Printable View
Our inflation fighting central bank hard at it.
Sounds like they don't want to stop FLP in case banks forget it is available next time it is needed. That makes sense.
https://www.interest.co.nz/banking/1...nt-ensure-tool
Good time to be in banking, record profits. I wonder why? Good prudent management? or RBNZ gaurantee? back stopped by depositors if needs be through the OBR.
https://www.rnz.co.nz/news/business/...shocks-to-come
Bernard Hickey on the case.
https://www.interest.co.nz/borrowing...nquiry-reserve
by choosing to use the wealth effect to rescue the economy, the Reserve Bank was making both a monetary policy decision and a wealth redistribution decision.
With Robertson's approval. Next time Jacinda Ardern or Labour says they are concerned about poverty, it might pay to point out their words mean nothing as the reality of their actions is the complete opposite of giving a s*it about poor people. No better than National both parties pander to the average selfish self centred home owning middle class. Neither will get my vote.
Although not RBNZ related Chloe Swarbrick highlighting the hypocrisy of Hipkins and Robertson. Obviously they are smart but will fight for whatever is best for them at the time. Like most people myself included but you would hope leaders would put the country as a whole ahead of their own house prices and financial security.
https://www.nzherald.co.nz/nz/politi...BEZ7A4OXBSP4E/
I think Arthur Grimes suggested a long time ago that the inflation target should be lowered, now he sees along with everyone else the "path of least resistance(regret)" RBNZ governor and labour making a mistake, admittedly in hindsight but we should look at it none the less considering the damage it has done to younger generations.
https://www.msn.com/en-nz/news/natio...b43f31fe357253
I appreciate the average self-centred homeowner does not see it as a problem.
Another RBNZ critic piling on.
I assume he would know what he is talking about. I agree QE seems misguided but what is wrong with requiring Australian owned banks keeping some capital in NZ. Complaints about Adrian embracing Maoritanga come across as racist even if it only highlights that Adrian is paid to worry about price stability yet he has failed miserably, while busy with other stuff.
https://www.stuff.co.nz/business/129...der-adrian-orr
Arthur Grimes and Graeme Wheeler also criticised the RBNZ but using your logic anyone who is not currently at the RBNZ has no clue.
Admittedly economics is an arts subject rather than a science but easy money and lower interest rates have been going for 30 years so not much change over the years I would have thought.
Adrian was just a bit more weak than previous governors about maintaining price stability in the (possible) face of declining asset prices and also running out of road to kick the can with the OCR near zero he turned to printing, as noted on the RBNZ website.
As the Monetary Policy Committee's (MPC) ability to lower the OCR became constrained during the COVID-19 crisis, we expanded our monetary policy toolkit. The MPC implemented a Large-scale Asset Purchases (LSAP) programme and a Funding for Lending Programme (FLP).
But I expect there will be some further unconventional policies to boost asset prices if they fall much further. They will have learnt their lesson and future money printing will only go into the banks to boost asset prices while keeping the CPI near 3%. No more helicopter money (govt bond purchases) as this has obviously gone to consumption and CPI inflation rather than assets.
I know nothing but can confidently predict lower interest rates (possibly negative (insane)) and more money printing (sorry, expanded monetary policy toolkit) if house prices fall 20%.
Monpol generally has a few unintended consequences
I may have it wrong but the govt issued bonds which the RBNZ printed up some money and bought, the govt then drops the proceeds of the bond issue into bank accounts all across NZ.
I am guessing you are retired so were not receiving the wages subsidies, resurgence support payments and the other renamed resurgence support payments.
I can't find anything on the total cost of the resurgence support payments but this was the wage subsidy cost after the first lockdown and does not include the wage subsidies from the second lockdown in August 2021.
https://www.rnz.co.nz/news/political...subsidy-scheme
Does anyone have any information on the total cost of these support packages?
https://www.treasury.govt.nz/publica...on-expenditure
I can't find anything with google but the treasury link might break down somewhere how the $61.6billion was spent, a good chunk would have been wages subsidies and various support payments.
If we said half $30billion or $6,000 for every man woman and child in NZ ($30bill/5 mill). That is a lot of moolah dropping into bank accounts. If that is not helicopter money I don't know what is.
Admittedly it offset the money people would have normally "earnt" by going to work and doing something productive.
The govt bonds are a debt that future generations will have to repay, although with Adrian on the case inflation should take care of it provided he can keep suppressing interest rates while inflation runs rampant. Too bad if you are an investor wanting a return on investment. It's a funny old world we live in thanks to central bank economists.
I am not even sure why the RBNZ is on-selling the bonds and inflicting large losses on the bonds to the nz taxpayer. If it is just funny money, use the delete key instead of adding zeros, it is just as easy.
https://www.rbnz.govt.nz/hub/domesti...vernment-bonds
I mean I must be missing something. The RBNZ prints up some money buys the govt bonds, raises interest rates and sells those bonds at a loss to I assume banks or pension funds or private institutions. The govt has guaranteed any losses on the bonds so somehow the taxpayer ends up paying for this. I am obviously not smart as I cannot understand why they are doing it this way. Maybe someone on here can enlighten me. Why can't they hold the bonds to maturity and then it is a money go round with the NZ govt.
I have a vague memory of an article posted on this thread about the massive losses being inflicted by the RBNZ's actions I will have to look back when I have some time.
I wonder if Adrian and his monetary policy committee share this ladies view.
https://www.zerohedge.com/political/...ir-ivory-tower
A slip of the tongue I imagine. They might all feel the same way but unusual for someone to say it out loud. Their policies have been great for people who are well off and look set to continue.