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Quantitive Easing -Made in New Zealand-
...the Greens are currently proposing a round of quantitive easing 'printing money' (so they say it) to ease the pressure on the dollar and help the manufacturing sector in NZ to stay competitive - however, with a reserve bank interest rate of 2.5%, there's plenty of room towards 0% to achieve the same outcome
...in light of the relative high reserve bank interest rate, quantitive easing in NZ would be a completely misguided response to current economic challenges
...what had the Green Head been smoking before letting loose such misguided policies
Kind Regards
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Originally Posted by ananda77
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...what had the Green Head been smoking before letting loose such misguided policies
Probably nothing. He has always been capable of spouting nonsense economic theories while stone cold sober.The worrying thing is he has aspirations of holding the finance portfolio in a Labour/Green coaltion - and Labour seems to give creedence to his latest ramblings. ....... help......
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This talk is just going to unnecessarily spook people. Key said he thought this was "wacky", so it would be unlikely to pass a parliamentary reading anyway.
Last edited by gonzo56; 08-10-2012 at 01:39 PM.
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Originally Posted by gonzo56
This talk is just going to unnecessarily spook people. Key said he thought this was "wacky", so it would be unlikely to pass a parliamentary reading anyway.
But we have Greens, Labour and NZ First proposing changes to the RBNZ.
I think Key needs to stop dismissing these guys with these sort of quips and actually justify why they are wacky. Otherwise, if people dont know better, we may end up with it at the next election.
Brash did a good job on 'The Nation' a few weeks ago . This guy from Infometrics (in his personal capacity) has also had an attempt: http://www.tvhe.co.nz/2012/10/08/no-...-lunch-for-nz/
But he is going against Ganesh Nana from BERL.
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...think 'wacky' is the right word as reality has shown in the US that the QE-policy had hardly any effect on the trade weighted USD-index. OK, long term mortgage rates eased somewhat but here in NZ that would be easily achieved by lowering the RB interest rate
...anyway, why would New Zealand want QE, pushing reserve into the banking system with the desired outcome of lowering interest rates, so people start taking on even more debt and forcing already hot property prices even higher - and reality in the US has shown, that QE has definitely only saved the big banks from collapse as they were able to use the additional reserves to speculate in foreign currency transactions and foreign interest rate arbitrage - and currently, are the only ones together with global hedgefunds to buy up US properties at large
...how would such outcomes be desirable for the New Zealand economy
Kind Regards
Last edited by ananda77; 08-10-2012 at 03:53 PM.
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Tin-foil Hatter
Unfortunately, the Greens have set up the 'economic agenda' and now they are firmly in control of it. Even Ganesh Nana was on National Radio this afternoon defending those ideas - fair enough, BERL is the left-wing economic think tank. Labour is so power hungry that they will bend over backwards to accommodate a coalition with the Greens and NZ First that I'm sure that the RBNZ Act will be changed in 2014 - god help us!
The left has had this recurring obsession with destroying the value of currencies, but the issue is not about fostering exports and "save jobs" - they love inflation because inflation is a tax that detroys savings. Destroying savings make people be more dependent on the state.
Sadly affair, unfortunately. I cannot see how we can stop this kind of policy nonsense. By the time everyone works out that the lunacy of such a policy is a complete failure, we won't have a NZ as we know it. To top it all off, we'll likely have another housing bubble; real estate is one of the very few things that can protect against hyperinflation. Most of the other options are outside the reach of the prole.
God - Please give us just one more bubble....
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Originally Posted by CJ
But we have Greens, Labour and NZ First proposing changes to the RBNZ.
....and they all expect the oldies to vote for them....... How will Winnie explain to his fan club why this will be so wonderful for them?
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Dont get me started on the Greens, or the idiots who voted them in.....
Just because the rest of the world prints money doesn't make it right here!
"Gold is money, everything else is credit"- J.P. Morgan
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What do you expect out of the National Frying Pan into the Green fire. if it happens blame John Key for the present economic mess
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Originally Posted by POSSUM THE CAT
What do you expect out of the National Frying Pan into the Green fire. if it happens blame John Key for the present economic mess
I certainly wouldn't blame Key. He's doing the best thing possible - leave well alone. He knows no better than the markets, and doesn't pretend to. The last thing we want is Norman, Cunliffe/Parker/Peters and the like trying to 'fix' things. For a kick-off, they're not broken. Go for a wander around the planet and youll soon see how well NZ is holding up compared to most of the world.
Last edited by fungus pudding; 08-10-2012 at 08:10 PM.
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