Here's our summary of key economic events overnight that affect New Zealand with news of powerful forces at work in both the US and China.
All eyes today will be on the opening of the Shanghai equity markets after their week-long holiday. Many think outsized gains are likely. Over that same period the Hong Kong index rose +12%. And those changes will be in anticipation of the yet-to-be announced fiscal stimulus program that Beijing has signaled. There are high expectations. But investors are probably sensing they can't lose with the central bank's logic-changing ¥800 bln (US$115 bln) capital market support measure in place.
But with 'buy-the-rumour-sell-the-fact' mentality of many investors, who knows what will happen. Some fund managers will feel they don't want to miss a unique profit opportunity, others are more sceptical the economic fundamentals are not getting proper attention.
China can afford to throw money at their issues. Their foreign exchange reserves rose by +US$28 bln to US$3.316 tln (¥23 tln) in September, slightly more than expected. And it built to its highest level since late 2015. Their gold holding rose in value too, but only because of the rising price.
Japan's leading economic index, which was expected to rise slightly, in fact fell and by quite a dip. In fact it was their lowest reading since 2020. They will be hoping this is a rogue result.
European retail sales were expected to rise in August and they did, coming in +0.8% higher in 'real' terms than a year ago for the Euro Area. But that undershot expectations of a +1.0% rise. For the wider EU bloc, things were slightly better.
German factory orders were weak in August, down -3.9% from a year ago. But that was a correction from the +4.6% rise in July.
In the US, Hurricane Milton strengthened into a monster Category 5 hurricane as races towards Florida’s west coast. Cat 5 storms are rare. Given what Helene did recently (Cat 4), residents have begun to flee inland in large numbers. Hopefully it will lose strength before it hits Florida. It is still deep in the western Caribbean Sea about 1000 kms from landfall.
After a +US$25 bln rise in July, American consumer debt was expected to rise another +US$12 bln in August. Update: In fact it only rose +US$9 bln with unexpected weakness in revolving debt (mainly credit cards).
The UST 10yr yield is now at just on 4.02% and up +5 bps from yesterday. The key 2-10 yield curve is still positive, but lesser at +4 bps. Their 1-5 curve inversion is now inverted by -38 bps. And their 3 mth-10yr curve inversion is now at -83 bps. The Australian 10 year bond yield starts today at 4.27% and up +21 bps. The China 10 year bond rate is at 2.16% and unchanged. The NZ Government 10 year bond rate is now just on 4.35% and up +6 bps from this time yesterday.
Wall Street is hesitant starting its week, down -0.6% and ignoring the weekend futures market. Overnight European markets ended mixed with Frankfurt down -0.1% but Paris up +0.5%. Yesterday Tokyo ended its Monday session up +1.8%, and nearly matched by Hong Kong which was up +1.6%. Shanghai was on holiday but returns today. Singapore was up +0.3%. The ASX200 rose +0.7% but the NZX50 dipped -0.2% ( which involved a small late session recovery).
The price of gold will start today at US$2644/oz and down -US$9 from this time yesterday.
Oil prices are up +US$2.50 at just on US$77/bbl in the US while the international Brent price is still just on US$80.50/bbl.
The Kiwi dollar starts today at 61.2 USc and down -40 bps from yesterday. Against the Aussie we are still at 90.6 AUc. Against the euro we are down -30 bps to 55.8 euro cents. That all means our TWI-5 starts today still just over 69.3, and down -30 bps from yesterday at this time.
The bitcoin price starts today at US$63,601 and up +1.3% from this time yesterday. Volatility over the past 24 hours has been modest at just on +/- 1.7%.
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75 Comments
the Police themselves admit that primary source of the problem is the imported gangs (Comancheros and Mongols primarily). They moved quickly to using the guns they could get their hands on. The other gangs only tended to resort to them under pressure. The laws were never the problem. The failure to police and enforce them was.
A government of the donors , by the donors , and for the donors.
At least they are been open about it .
Edit , echo in here.
It would seem either McKee or Bennet have questions to answer.
Which also brings into question Ministers / advisors culpability for actions under a former govt.
With hindsight to be fair , nobody could see what was going to happen coming.
Does she have a bias or does she just understand the subject better than the critics whose demonstrated bias is anti-firearms?
People argue that a firearms register makes the country safer. It does no such thing. It will just tell the Police who the law abiding firearms owners are. an analogy is car registration. Cars are registered but that doesn't prevent people committing crimes with them, or stealing them.
The emotional hype around this issue completely ignores the fact that if the police had done their job properly in the first place, the racist Aussie would never have been able to buy his guns legitimately in the first place. Who has been held to account for that so far?
No, but through legislation and the control afforded by registering dogs eventually pit bulls should no longer exist in NZ.
https://www.aucklandcouncil.govt.nz/dogs-animals/problems-dogs/Pages/da…
Alternatively, get rid of the dog register, allow thousands of pit bulls to flood into NZ but make sure none end up in the hands of gangs and only go to "responsible owners". That'll work.
The USA is never ever going to get guns under control. Likely there are as many illegal as legal firearms present nationwide. Having lived there, in general community talk, it is as easy to acquire a stolen gun as a stolen phone. NZ though, tiny in comparison, should have been able to legislate efficiently and enforce that resultant law effectively enough to minimise the danger to a degree far below the present events and circumstances often in the news now.
Actually the increase in meth use is directly because of the ban on psuedoephidrine sales in NZ. Instead of going to the effort of making the stuff the gangs just import it, and it turns out its far easier and cheaper to import it than it is to make it. Again, the law of unintended consequences strikes. At least thanks to David Seymour, we can get our cough mixture back.
The problem with your argument is that after the buy back of firearms, there are a lot less firearms in NZ than there used to be, but firearms use in the perpetration of crimes is higher than it has ever been.
Again correct policing of the law prevents most of that without having to restrict firearms.
Don't get me wrong, there are plenty of people (Kiwis) who should never have access to a firearm, but that doesn't make the firearm the problem.
And I have never bought into the NRA extremism, but neither have I bought in to the anti-gun extremism either.
I have no idea. It is possible, although I think unlikely that some did. It is possible that Police had no idea some guns were stolen. But The Police themselves have identified that the dominant illegal use is by the imported gangs (stated this in another comment earlier in the stream), and other local gangs are only picking up the trend under pressure.
I've never seen a proper zombie in the flesh.
Thus my understanding of the best way to deal with them is limited to movies. Seems there are many other ways. The Double Tap movies provide many insights. I'd recommend watching them to anyone looking for ways to protect themselves.
I've met near zombies at National & Act party events, religious events and at a Taylor swift concert. They're pretty harmless. But also pretty boring, and none too bright.
Chrisofnobrain, what a shame you didn't stay there!! I am also a gun owner, also lived in America. Comparing our gun ownership laws with America's is blatantly stupid! Labour's changes in response to a total police failure are also blatantly stupid! Nicole is doing a great job and I'm confident we will end up with sensible law that does not demonise lawful gun owners! As usual you know all though!
More brain dead statements! Firstly, no I won't be on the front line as I am not a policeman. But you don't have to be very bright to see that Liebours reforms have not made one iota of difference to gun crime. In fact it has got worse! Why don't we just arm the police as standard, not very many police call outs now that they are not standing around with their AR15's.
Chris Cahill is not a cop, he's a lobbyist! And full of shit!
Secondly "HeavyG", not paranoid nor a gun loving freak. Just use them for intended purpose. Not sure how one nut-job has normalised mass shooting in NZ? Perhaps your obviously superior intellect could explain this.
Or bombs. Weapon of choice in places like Sweden now
https://www.politico.eu/article/sweden-new-normal-bomb-attacks-suburbs-…
People gonna kill people regardless of which weapons you pick and choose to ban.
Bombs though need just as much attention. Preferred weapon of anarchists, eg Barcelona 1893, or modern day terrorist counterparts eg Oklahoma City 1995 or the Boston marathon. Added advantage, the perpetrator(s) don’t necessarily need to be present and live to strike another day. The lone gunman though attracts the greater headlines. For instance lived in the USA during 911 about half between NY & the subsequent car snipers in Washington DC. In terms of neighbourhood concern the latter was much more scary although of course it was admittedly unlikely that a 767 was going to be flown into your particularhouse.
Also a licenced gun holder here and its one of the very hard to get hold of categories. Things have only got tougher for licence holders like me but its not the licence holders for 20+ years you need to worry about. Every gun in this country should have been on a register decades ago, the police were lazy and now its way too late to try and fix the problem. All that is happening now is licenced owners keep getting repeatedly hit with a brick bat.
"The emotional hype around this issue completely ignores the fact that if the police had done their job properly in the first place, the racist Aussie would never have been able to buy his guns legitimately in the first place."
When designing safety systems to protect public life & property, designers take into account that human mistakes will occur.
The designers of such safety systems do NOT intentionally create further opportunities for mistakes to occur as this government is doing.
Really? I accept that you believe what you just said but it is just BS.
"When designing safety systems to protect public life & property, designers take into account that human mistakes will occur." What they really do is make a whole bunch of assumptions, many without even being aware they are making them (ask any computer programmer), and build systems around those assumptions. Besides do you think "..designers take into account that human mistakes will occur." includes that the rules will not even be policed and enforced as one of those mistakes?
Who has been held to account for that so far?
As it happens, that Coronial Inquest started just yesterday:
October 2024 hearing on Issue 10 | Coronial Services of New Zealand (justice.govt.nz)
"Issue 10 relates to whether the firearms licensing process followed by Police in issuing the offender’s firearms licence can be causally connected to the attack, and therefore to the deaths, and if so, whether any identified deficiencies in that process have now been addressed by way of legislative amendments or any Police (or other relevant entity) process changes."
I was surprised by this, how can the Police ever be excluded from consultation about anything to do with firearms at any point in a consultation process? As stated in the article (published 12 August), the Police are literally in the firing line.
The Police Association wants responsibility for firearms reform taken off ACT Minister Nicole McKee, saying she's a former gun lobbyist and has excluded police from consultation.
He said the minister had included 17 firearms interest groups in a targeted consultation process for the review, and just other eight groups who may take a differing view. The association is also not one of them.
Michael Reddell takes the Coalition to task over their welfare plan for property developers.
Public policy just keeps on worsening | croaking cassandra
I had thought the guarantee was for loans to banks etc. from that article they're actually underwriting the eventual house price. So they're underwriting the bank loans and all other costs incurred. Meaning house prices cannot fall or we the tax payers will be crucified.
They actually said that in the media release/interviews, to whit the government will agree to buy a limited number of homes at an agreed price (if not sold on the open market). It was stressed that the agreed price would be less than the listed price(????!). Struck me at the time as being open to manipulation and profiteering by the developers et al, but then I slapped my self and said I was being too cynical! (Yeah right!)
The whole thing does smell a bit fishy. It has a round table feel to it. It's great that more houses will get built from it... but why was the governments position immediately to state the anticoruption aspect of it... it was as if they were putting out the fire before anyone sees the smoke
Hard to disagree. Has every aspect of a scheme with unforeseen and/or unmanageable consequences that cannot but impact negatively on the public purse. There just seems too much central government interest in NZ’d housing stock these days and resultantly, unnecessary and unwanted complications.
They are underwriting the sale. Which will result in the exact same thing that happened to the Kiwibuild scheme - developers jack up the advertised price because they dont care if they sell or not (which they wont) as the Govt will then be forced to buy them. Developers banked massive profits out of that Kiwibuild underwrite, and they will do the same again. Taxpayers foot the bill.
It also begs the question of why are they paying developers to build housing that nobody wants? There is a pile up of unsold cookie cutter townhouses and apartments, so why build more and put taxpayers on the hook for buying this crap?
Probably worth noting that the RBNZ's 'need' to hold rates too high for too long is now driving seriously market distorting Government policy.
Probably also worth noting - in case people feel like laying the blame solely on the absurd policy choices from our RBNZ - that schemes like the Residential Development Underwrite scheme are nothing new and every time they've been used the results are entirely predictable, far from equitable, and hugely market distorting. Government should know better. This one apparently does not.
Or put bluntly - Such schemes are a very obvious acknowledgement that 'free markets' aren't working. Funny how we get that right-wing free-market political parties, ay? Maybe they should be fixing the whole market rather than handing free money to their donors?
"China can afford to throw money at their issues. Their foreign exchange reserves rose by +US$28 bln to US$3.316 tln (¥23 tln) in September, slightly more than expected. And it built to its highest level since late 2015. Their gold holding rose in value too, but only because of the rising price."
Yes, China can afford to buy stuff internationally which is all it is really good for - deferred imports. However they cannot use these reserves domestically without converting the foreign funds into RMB, i.e. devaluing the RMB and printing money.
yeah they would be defending the rmb by pissing away usd, success, i guess?
china's growing reserves is on the back of suppressed domestic consumption by households. until they rebalance their economy nothing will change, and therein lies the problem - the chinese economy is one that has been based domestically on debt fuelled property and infrastructure. china needs these surpluses to allow its economy to stop taking on more debt. it is all systemically tied together.
china cannot afford to do anything until it either decides to blow it up, or it blows up. they've left it this long that they have all but guaranteed to make japan's lost decades look progressive.
‘Ten-year yields , which leapt more than 20 basis points over last week, topped 4% on Monday for the first time in two months and 2-year yields were stalking 4% too - flattening the 2-10-year yield curve to near zero in the process.
Fed futures pricing has now not only removed all chance of another half point cut next month, but is even starting to see doubts creep in about any cut at all in November - with only 23 bps in the price and no more than 50bp for rest of this year.
And the "terminal rate" in this Fed cycle has now jumped to as high as 3.25% - above the 3% landing zone broadly assumed after the central bank's first outsize cut last month and above the 2.9% level Fed policymakers had indicated as long-term "neutral".’
https://www.reuters.com/markets/us/global-markets-view-usa-pix-2024-10-…
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