HGH - Heartland Group Holdings

[Waikaka]

I presume your reference to superannuation paying most bills was a joke? For a start you must assume that accommodation cost has been excluded? Not everyone has the same size household or level of bills. A sudden drastic reduction in your previous income will have an immediate effect in being able to pay your usual bills, unless you were saving a large amount out of your previous income.

Your estimate of portfolio value of $750,000 and dividend yield were pre Covid recession valuations? That portfolio may have lost 20% (or more if you had a high dividend yield portfolio)

I don't want to sidetrack what is quite an informative thread. The straw-man portfolio would be as at today values so yes was larger before correction.

Obviously individual circumstances vary but your hypothetical 70+ person who needs Heartland dividends to pay the bills is also in the cohort that has the highest home ownership rate of all NZrs, at around 77.5% (2013 census was the latest I could find). I suspect that most will be mortgage free. Accommodation is unlikely to be their largest expense. Perhaps other cohorts with more debt, job uncertainty and obligations (ie young families) will be hit harder? Whatever the situation individuals are in, I hope we all pitch in to help those in need.

My only point is that pretty much everyone in NZ is in the same boat, portfolios down, dividends cancelled, jobs lost, capital raises coming when not much cash is around. I understand the disappointment in having the govt enforce rules but that is their job.

The wide ranging new rules have impacted many business. Do I mind that my ANZ and WBC will suddenly be not paying dividends, yes, but do I think now is the time to be conservative with cash and protect balance sheets it is also yes.

[Bjauck]

Do I mind that my ANZ and WBC will suddenly be not paying dividends, yes, but do I think now is the time to be conservative with cash and protect balance sheets it is also yes.

Pensions do not cover all expenses as of course they assume home ownership. It underlines the protected position of investment in real estate in NZ. A situation which has passed its best before date.

Many people have indeed been impacted by the Covid response. Many shareholders may have relied on their dividend income as employees relied on their salaries, notwithstanding that both sources carry continuity risk..

I agree that bank dividend suspension is prudent. However it is worth noting that there has not been a mandated suspension of Australian bank dividends (yet)

Perhaps there has been greater reticence in so doing there as share ownership is more widespread and Australian bank shares figure highly in Australian pension accounts?

[Snow Leopard]

One of the rules of life is to have enough cash set aside to pay your expenses for a few months whilst hoping the bank(s) you are keeping it in does not go phut!

Heartland is the bank I am invested in but not one of the banks I keep my cash and term deposits in.

Hoping to see the far-side of these unusual times intact.

[davflaws]

Do you have income other than your income from your investments? There are some people for whom income from investments is their main source of income. Without dividends they may not be able to pay their bills.

I am lucky enough to have National Super, and up until the lockdown had a modest professional practice as well. That is where the surplus to build a portfolio came from. That practice has (like the portfolio) crashed, and over the next few months will probably burn. So my income has been very sharply reduced, and is likely to be further reduced. I have had to reduce budgeted expenditure accordingly, but I am still a hell of a lot better off than a huge number of other people.

I can't muster too much sympathy for the "haves" - (people who are pretty well located towards the top of the heap) who are moaning about having their dividend income reduced, while the "have nots" on the bottom are coping with a reduction that is making many of them dependent on food parcels.

[Bjauck]

...
I can't muster too much sympathy for the "haves" - (people who are pretty well located towards the top of the heap) who are moaning about having their dividend income reduced, while the "have nots" on the bottom are coping with a reduction that is making many of them dependent on food parcels.

Well if the haves are wiped out, the government will need to have deep pockets for a long time to fund and establish businesses afterwards. Too bad if the impact from their drastic Covid measures, and who they chose to support, could also be seen as a way of establishing a government owned socialist society.

Of course there are many have-nots who have been impacted and who do not receive sufficient compensation from the government. However not all shareholders are in the "haves" and of course they get zero compensation from the government. You need a certain level of wealth just to be able to get the deposit for a below median price house in many parts of NZ these days! Homeowners are the "haves"

After Covid-19, it makes me wonder how much longer NZ can carry on without some sort of general wealth tax and with so much wealth wrapped up in real estate/land values.

[kiora]

One of the rules of life is to have enough cash set aside to pay your expenses for a few months whilst hoping the bank(s) you are keeping it in does not go phut!

Heartland is the bank I am invested in but not one of the banks I keep my cash and term deposits in.

Hoping to see the far-side of these unusual times intact.

Another rule is to spread it around a few banks in these times when its crazy out there

[Balance]

Another rule is to spread it around a few banks in these times when its crazy out there

CBA & ASB - to me, the strongest & most financially robust bank in the Australasian financial markets - principally consumer & household based lending & well diversified funding base.

The Australasian 4 trading banks (& NZ subsidiaries) operate with implicit government guarantees imo.

[janner]

After Covid-19, it makes me wonder how much longer NZ can carry on without some sort of general wealth tax and with so much wealth wrapped up in real estate/land values.

Perish the thought.

The haves in the main have worked and saved.

There are far to many in this country that are happy to just bludge.

Yes there will always be those that do need assistance.

If you do not work you do not eat was my up bringing.

Time to get back to basics IMHO.

[Balance]

Perish the thought.

The haves in the main have worked and saved.

There are far to many in this country that are happy to just bludge.

Yes there will always be those that do need assistance.

If you do not work you do not eat was my up bringing.

Time to get back to basics IMHO.

Yup - agreed wholeheartedly.

Labour is going to need the productive sector (those doing real work) and the funders (those with money) post the lockdown to pull NZ out of the humongous debts which is being incurred now.

Going to be tens of thousands out of jobs - where are the jobs going to come from?

[kiora]

Yup - agreed wholeheartedly.

Labour is going to need the productive sector (those doing real work) and the funders (those with money) post the lockdown to pull NZ out of the humongous debts which is being incurred now.

Going to be tens of thousands out of jobs - where are the jobs going to come from?

Yep that's the worry.
We either need herd immunity,a treatment or vaccine so airlines, tourism & hospitality can get going again very quickly otherwise their will be a lot of people on an enforced holiday for a long time
In the meantime we need the crops,seafood,forestry & meat industries to ramp up back to more normal levels.A worrying problem is storage,logistics,shipping & containers
At least the tech industries can work more remotely
Balance of payments will be interesting as in spite of primary exports being reduced imports should be well down as well.Will we see a bounce back in consumer demand?
Interesting times