Breakfast briefing: Powell in no hurry to cut rates, defying Trump

Economy / news

Trump prevents corruption enforcement; Powell holds the line; Canada building activity rises; India defends the rupee; China targets food security; Aussie sentiment flat; UST 10yr at 4.54%; gold and oil up; NZ$1 = 56.6 USc; TWI = 66.8

12th Feb 25, 7:20am by David Chaston

Here's our summary of key economic events overnight that affect New Zealand with news the USD is wavering (down -1.7%) as policy missteps especially on the impact of the trade war hostilities. Benchmark interest rates are rising as risk premiums rise. Estimates for US growth are getting downgraded, while estimates for US inflation are being raised. These latest shifts will have global echoes.

And in a shameless move, the US President has ended enforcement of the Foreign Corrupt Practices Act, saying bribing foreign officials is now a part of US diplomacy. Previous you could go to jail for that, and many people did. The lack of enforcement will probably only apply to Trump's supporters.

The US Fed boss Powell is testifying before Congress, newly hostile because Trumps troops are gunning for lower policy interest rates. He also pushed back on 'being rushed' on rate cuts. At the accusation the Fed is overstaffed, he countered that they aren't, but they are overworked.

Last week's American retail Redbook index rose +5.3% above year-ago levels, a slowing but still a notable rose.

Also at a good level is SME business optimism. But uncertainty is on the rise. This January survey by the NFIB was expected to rise from December, but it fell.

There was another large, but well-supported US Treasury three year bond auction earlier today and that went for a yield of 4.26%. This was slightly below the prior equivalent event a month ago at 4.29%. Fear is being priced in more than uncertainty.

The February USDA WASDE report has been released. It shows the US will likely produce more beef in 2025, and import levels will remain unchanged. But prices are rising they say on rising demand. They also so US milk production is in a declining phase with fewer cows milking. They see prices holding, in USD terms of course.

In Canada, December building permit levels rise sharply and by much more than expected. They were +11% more than in November and a massive +30% higher than in December 2023. Although this metric does tend to jump around a bit, there are some substantial gains here.

In India, their central bank has intervened in currency markets trying to stop the fall and speculative shorting of the rupee. It had ballooned out to almost 88 to the USD and the intervention brought it back to 87. However even that level is a notable devaluation. The RBI probably doesn't have the resources to fight market shorters.

In China, President XI is out visiting the regions, and emphasising the importance of food security. Beijing must be worried if they give it this much repeated exposure.

And yet another large property developer is throwing in the towel, not opposing its winding up.

The social-media-recorded pushback during the Covid lockdowns in China that "we are the last generation" is continuing to echo, and echo loudly there. After rising slightly in 2023, marriages fell sharply in 2024 and to their lowest since China's public records began in 1986. This means the public efforts to stop the sharp fall in births are not working. (And yes, if you try to follow the link to the data, you may well find yourself blocked. But it is the source data for this item.)

In Australia, the Westpac-Melbourne Institute consumer sentiment survey reported no improvement in January from the flat levels that have been around for the two prior months. But the NAB Business Sentiment survey is reporting that their responders are finding a more positive mood.

The UST 10yr yield is at 4.54%, up +5 bps from yesterday at this time. The key 2-10 yield curve is steeper at +19 bps. Their 1-5 curve is steeper at +12 bps. And their 3 mth-10yr curve is little-changed at +24 bps. The Australian 10 year bond yield starts today over 4.48% and up another +5 bps from yesterday. The China 10 year bond rate is now at 1.63% and up +1 bp. The NZ Government 10 year bond rate is now at 4.61%, up +1 bp from yesterday.

Wall Street has opened its Tuesday trade down -0.2% on the S&P500. Overnight, European markets all closed about +0.4% higher, except London which was up only +0.1%. Yesterday Tokyo closed essentially unchanged again. Hong Kong ended its Tuesday trade down -1.1%. Shanghai was down -0.1%. Singapore was down -0.4%. But the ASX200 ended little-changed. That was bettered by the NZX50's +0.3% rise.

The price of gold will start today at just under US$2904/oz and up +US$4 from yesterday..

Oil prices are up +50 USc at just on US$73/bbl in the US and the international Brent price is now just under US$77/bbl and back to week-ago levels.

The Kiwi dollar is now at 56.6 USc and up +10 bps from this time yesterday. Against the Aussie we are down -10 bps at 89.9 AUc. Against the euro we are also down -10 bps at just under 54.7 euro cents. That all means our TWI-5 starts today just on 66.8, essentially unchanged from yesterday at this time.

The bitcoin price starts today at US$96,409down -0.9% from this time yesterday. Volatility over the past 24 hours has been modest at +/- 1.2%.

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150 Comments

by powerdownkiwi | 12th Feb 25, 7:36am 1739298982

Maybe an NZ journalist could follow up on that 'final generation' thing?

Nup, won't happen. Fiercely won't happen.

Food/energy well explained: https://gardenearth.substack.com/p/eating-oil

And the systemic dilemma likewise: https://by-my-solitary-hearth.net/2025/02/10/the-daily-10-february-2025/

' That is what this increased cost of everything is all about. We are running out of the affordable material bases of our economy, and so our economy is contracting. Money can not buy as much as it once did simply because there is not as much to buy. Relative to contracting material supply, money has lost its value. And material supply is contracting quickly, maybe not in absolute terms, but in affordable terms. There may be plenty of oil to sustain drilling in the Arctic, but it will take almost as much in energy to extract oil in those adverse conditions as we will get out of burning it. This is true of everything. There may be deposits. But all the easy-access and high quality materials are gone. For what is left, the cost of extracting resources is more than the benefit in using them — even if you calculate benefit as a capitalist does and ignore all the externalities like maintaining a viable planet.'

I couldn't have put it better...

by Pa1nter | 12th Feb 25, 7:41am 1739299315

If the price of oil hasn't moved substantively in like decades

But the stuff made using oil has gone up

Could the scarce resource be people willing to work for nothing

Or our ability to work in cohesion

by JimboJones | 12th Feb 25, 7:58am 1739300333

Most of the stuff made with oil has gone down hasn't it?

by Pa1nter | 12th Feb 25, 8:30am 1739302228

If we look at fruit, relative to the cost of petrol

Petrol hasn't moved much relative to a dollar

Indigenous seasonal fruit has on aggregate

Something like bananas, less so

So the variable to me, seems to be the cost of doing things in a specific locale.

by agnostium | 12th Feb 25, 10:06am 1739308006

If the price of oil hasn't moved substantively in like decades

The price of oil is heavily heavily subsidised and does not reflect the true costs, which is why we see price increases in other areas, to cover those subsidised costs.

If you want a good analogy look at parking. People think it's free, it isn't you pay for it one way or another, more often that not the cost is paid in hidden subsidies.

by kiwikidsnz | 12th Feb 25, 10:12am 1739308320

...so, like cycle lanes then

by Pa1nter | 12th Feb 25, 10:24am 1739309083

No, that's different, costs are only subsidized on things you don't agree with.

by RickStrauss | 12th Feb 25, 12:55pm 1739318114

True, we're far more angry and insistent about business cases for cycle, bus, train or ferry than we are for roads for cars and road freight donors.

by agnostium | 12th Feb 25, 5:56pm 1739336191

No, that's different, costs are only subsidized on things you don't agree with.

No that's not correct. You can pull out the business case for most cycle lanes, it will generally be positive because otherwise they don't get funding.

Publicly provided parking generally doesn't require a business case. A lot of private parking was mandated through minimum parking requirements (again no business case). The private sector will often provide parking anyway but they transfer the costs indirectly through higher prices, lower staff salaries, etc...

I know you have a contrary opinion on every subject but in this case you are just straight up wrong.

by rastus1 | 12th Feb 25, 11:01am 1739311264

...yeah also like footpaths, sports grounds and stadiums.

Cycle to work.

No brainer, benefits are huge. Join the enlightened.

by agnostium | 12th Feb 25, 5:52pm 1739335945

...so, like cycle lanes then

Some cycle lanes but not all. Most have a positive BCR, they struggle to get funding if they don't.

As a comparison, there is no requirement to do a business case for on-street parking, if there were it would not get a positive BCR, which is probably why it is not required.

by Pa1nter | 12th Feb 25, 10:19am 1739308799

If you start getting into the intangible or unrecoverable costs, then the true price of pretty much everything becomes very blurry.

by agnostium | 12th Feb 25, 6:02pm 1739336575

I think you are confusing monetisable costs, prices and intangible benefits.

The price of oil is heavily subsidised, that subsidy is getting higher and the costs manifest as higher prices in other areas. What do you think is the primary driver of the higher cost of living?

by HouseMouse | 12th Feb 25, 7:35am 1739298933

Don’t know Canada well, but the fact that the OCR there is 3% can’t be harming construction.

Broken record, I know, but construction won’t meaningfully pick up here until the OCR is 3% or less

by IT GUY | 12th Feb 25, 7:50am 1739299839

I agree, and there will be a lot of fear if OCR gets there quickly, that it might rise again... that will not help either.

NAct need to sort out the Watercare issues real fast if they want growth growth growth, its the elephant in the room for Auckland.

Massive amount of land around the Silverdale motorway has been rezoned , but Watercare may just say no. Also a 4,500 house development behind Ara hills... may go on hold, perhaps Watercare is just playing hard ball for development contributions?

If you want construction to restart in Auckland , you need secure water connections.

by JimboJones | 12th Feb 25, 7:56am 1739300200

Council NIMBYs say no in the central areas with good water assets, Watercare says no in the sprawl areas with bad water assets. I don't think Watercare is in the wrong...

by Baywatch | 12th Feb 25, 8:21am 1739301702

Local water down well...

by agnostium | 12th Feb 25, 10:08am 1739308095

Council NIMBYs say no in the central areas with good water assets, Watercare says no in the sprawl areas with bad water assets. I don't think Watercare is in the wrong.

100% this. There is no free lunch.

by rastus1 | 12th Feb 25, 8:51am 1739303479

Rain water tanks work quite well. Someone tell Auckland.

by IT GUY | 12th Feb 25, 9:11am 1739304687

I am on tank water and dripper line based waste water. Works well but it only works on big sites etc....

by Palmtree08 | 12th Feb 25, 2:55pm 1739325338

Tank water has its own issues. Depends where you live I guess. All the crap released into the atmosphere that settles on your roof ends up washed into your tank.

We collect off about 350m2 and store about 40m3. Our rainwater is used for the garden and I've wrecked our tomato plants more than once by using it. I usually disconnect the inflow in August , before the cropping farmers start up their chem gear, then wait for a good rain after xmas to reconnect. Still been caught out. Guy on our western boundary leased a 1000 acre block and nuked the place every spring by helicopter. He's gone now thank goodness! I think people would be surprised if they knew what's floating around in what appears to be clean air.

by meh | 12th Feb 25, 3:09pm 1739326149

I worked in the Auckland house building industry for a few years. In many cases of second dwellings, tanks were required but not for the collection and storage of rainwater, only to slow the flow of stormwater.

I think there were also rules in some areas making it mandatory to connect water and wastewater facilities, if they were available.

by RickStrauss | 12th Feb 25, 9:04am 1739304291

It doesn't seem affordable infrastructure-wise to sprawl everywhere. Watercare are probably just being realistic.

There's still a massive amount of intensification that could be withstood closer to the centre of Auckland where infrastructure already exists (and was designed for more water per person than we now use). And then cheaper to upgrade than to lay massive new sprawl (according to former Watercare engineers I've talked to).

Out of interest - are your 300 acres up that way? Not assuming so, but checking.

by fra99le | 12th Feb 25, 1:05pm 1739318746

It'll certainly be cheaper to use the existing water and wastewater capacity in those more central areas. But once it gets to requiring capacity upgrades, it probably won't be cheaper, given that it's underneath an existing city. Decentralised greenfield developments shouldn't cost as much as upgrading existing water and wastewater infrastructure (as a general rule, with exceptions). Trying to connect them to existing systems probably would as you are then into upgrading those systems as well as the reticulation. (Of course other infrastructure and operating costs will be higher in areas of sprawl, e.g. transport).

by RickStrauss | 12th Feb 25, 2:53pm 1739325238

Actually these engineers were specifically referring to the cost of upgrades within the existing city, and intensification being cheaper than greenfield sprawl. Mixture of open cut and tunnel-through style of replacement. And given the size of arterial infra already in place (existing trunk lines often have spare capacity that can be utilised before), along with the fact that greater distances require more pumping stations and higher ongoing costs (The City of Calgary found that pumping costs for distant greenfield developments were 2-3x higher per household than central areas).

Analyses overseas have found the same, even when infra did need to be upgraded: E.g. a Halifax, Canada 2013 infrastructure cost analysis found that upgrading existing pipes in dense areas cost ~$5,000-7,000 per dwelling, while new greenfield infrastructure averaged $15,000-22,000 per unit.

Likewise for ongoing maintenance, sprawl means far more infrastructure to be maintained per household, which is very expensive. Pushing rates far higher.

Point is, the engineer I spoke to was very sure of what they were facing and the pros / cons, and while you might find the odd area where it'll be more expensive to upgrade than a typical greenfields build, on the whole they were very much seeing greenfields being far more expensive.

by Palmtree08 | 12th Feb 25, 9:05am 1739304356

Amazing a country blessed (past tense) with an abundance of quality water resources could be hitting the wall in such a short time span. Says something about the quality of governance over the last few decades. We could always do toilet to tap like they do in LA. Just imagine, all the benefits of of consuming a nice glass of water with healthy additives like blood thinners and birth control hormones?

Good thing the goal of exponential growth measures all the dollar benefits of creating all this infrastructural signature of declining quality of life, rather than the insanity of needing it in the first place. Insanity growth has a more honest ring to it. Harder to market to the plebs at election lolly scramble time though.

by RickStrauss | 12th Feb 25, 9:11am 1739304686

In Auckland it actually says more about the decades preceding the last couple. Councils took in contributions for waters and used them elsewhere. Splitting Watercare out finally enabled them to get started on the backlog.

Wellington...well, seems from a distance that the folk involved in Vision Wellington now (former mayors etc) presided over simply more kicking the can down the road to keep rates artificially low.

by fra99le | 12th Feb 25, 12:57pm 1739318262

Yes. Auckland's water(s) infrastructure is in a much better state than Wellington's. They are having issues coming off very little population growth. Auckland has much higher population growth and so its needs are more about new infrastructure, than about just catching up on deferred repairs.

by RickStrauss | 12th Feb 25, 2:37pm 1739324263

Yes, deferred investment not just deferred repairs.

by fra99le | 12th Feb 25, 12:51pm 1739317895

We do Hamilton's toilet to Auckland's tap already.

by Palmtree08 | 12th Feb 25, 2:37pm 1739324238

Mmm, nutritious.

by meh | 12th Feb 25, 3:18pm 1739326712

We need to be more innovative in our greywater usage. A simple handbasin to toilet cistern. Seems senseless to use freshwater for flushing toilets. Greywater to gardens makes sense too. Only requires being more conscious of what cleaning products we're using.

Innovation isn't necessarily new products etc. It can simply be a change in ways and processes. It does require a rethink in purpose and outcomes.

by RickStrauss | 12th Feb 25, 4:18pm 1739330308

Japanese style, the handbasin on top of the cistern!

by meh | 12th Feb 25, 2:47pm 1739324878

Or the price of land and all other construction costs are meaningfully reduced.

But nah interest rates.

by Foxglove. | 12th Feb 25, 7:39am 1739299171

Still in China, food security is being stressed by the President no less. That achilles heel has been often mentioned in reports on here. NZ does produce good safe food. If nothing else, in troubled times, that is a plus.

by JimboJones | 12th Feb 25, 7:57am 1739300277

Yet we import a lot of our food from China. Anything that is cheap at the supermarket is either made in China or doesn't say where it is made.

by Pa1nter | 12th Feb 25, 8:11am 1739301090

A lot of it may be processed in China, but the food component of what's in the packet likely came from somewhere else.

Ahhh globalism, where a $1 fruit pot grew in Sth America, before getting shipped to SE Asia for processing and packaging, and then shipped down to us to put on a supermarket shelf, where it's still cheaper by weight than fruit grown down the road.

by JimboJones | 12th Feb 25, 8:36am 1739302598

Its only cheaper because destroying the planet is a freeby.

by Pa1nter | 12th Feb 25, 8:40am 1739302829

That and there's an army of demons out there willing to do something for far less than we'll lower ourselves to.

by buyandhodl | 12th Feb 25, 8:48am 1739303304

Mainly this. Also the advent of the steel standardised shipping container decimated transportation costs.

It costs more to ship it from the port to the warehouse, and the warehouse to the supermarket here, than it does to ship it from South America to South East Asia, and then from South East Asia to the port here.

by RickStrauss | 12th Feb 25, 9:06am 1739304382

Crikey, don't let National-ACT-First hear you suggest there are cheaper shipping methods than road transport donors. Far too woke.

by Pa1nter | 12th Feb 25, 9:44am 1739306693

Sea is the cheapest but our larger cost problem will be human handling.

Port handling (and usually customs)

Freight

Distributor/Wholesaler

More freight

Retailer

You (plus maybe more freight if you shipped the item to yourself from the retailer)

That's a few mouths to feed. Whether a portion of that went by road or rail, doesn't alter the cost to move things around as much as we'd like to think.

by RickStrauss | 12th Feb 25, 9:46am 1739306797

Central Otago looks like an interesting case in coming years. The railway to Clyde was obviously ripped up long ago (though the land is still there for the cycle trail), and the population is growing as more and more Aucklanders and others look to retire down there. Truck volumes and thus road maintenance will be something to see, as it doesn't seem like there's any other way to get goods in. Might need to raise rates significantly, or add tolls on some roads.

Perhaps in the end we'll have to buy less stuff (including electricity, from the looks of it).

by Pa1nter | 12th Feb 25, 10:23am 1739309009

I think so long as they don't get traffic for 5hrs a day or more they'll probably be fine.

by RickStrauss | 12th Feb 25, 12:03pm 1739314991

That's going to be the kicker. Traffic already increasing through the Kawarau Gorge thanks to heavy development in Cromwell, Clyde, Alex etc. Plenty of development in Wanaka and Hawea is adding traffic to the Crown Range road.

by Foxglove. | 12th Feb 25, 12:09pm 1739315385

Which makes you wonder how the proposed international airport at Tarras was thought to offer an improvement on ingress to Queenstown. It would just add to the congestion. Personally couldn’t think of much worse than disembarking from a long haul flight and then tackling that road trip, especially ski season.

by Snow | 12th Feb 25, 1:02pm 1739318565

With wide-body jets going in there as well, each long haul Intl flight would have 2-300 people flying in and out. A lot of traffic to head to/from Qtown and Wanaka per flight. The traffic would be a pain in the ass, more than it is already. Couple that with the mine going in to Bendigo it would no longer be a quiet part of the valley.

by rastus1 | 12th Feb 25, 11:05am 1739311505

It will get F up down there just as Tauranga and Queenstown - mini Aucks. Queenstown used to be such a cool place. Ghastly now, but ok if you only pass thru and keep looking up.

by dumbthoughts | 12th Feb 25, 11:42am 1739313769

Absolutely vile spot these days. The scenery is still nice (and I always enjoy driving out to Glenorchy, having a swim in the lake with the dog and so on) but it's just so busy and such a celebration of "look at how much money I have". Avoid it like the plague these days.

What's more of a shame is that Wanaka is now becoming a mini Queenstown. Spent a week there recently for the first time in years and it was rather oppressive. You can't move for flash SUVs and generic-looking expensive 'holiday homes' that most people would kill to have as their primary residence.

by agnostium | 12th Feb 25, 10:10am 1739308240

Sea is the cheapest but our larger cost problem will be human handling.

It's only seems to be the cheapest because the fuel is massively subsidised.

by Pa1nter | 12th Feb 25, 10:22am 1739308952

Water has been the cheapest way to move stuff since before the internal combustion engine.

Something to do with the friction and obstacles of water vs land.

Jeez it's like you have to argue against everything I say. Or was it the other way round.

by ChrisOfNoFame | 12th Feb 25, 2:47pm 1739324852

Painter: Sea is the cheapest ... but our larger cost problem will be human handling.

So ... it is the cheapest? ... but it also not the cheapest?

Classic Pa1nter ... so many many of their posts provide laugh out loud moments.

by unaha-closp | 12th Feb 25, 9:43am 1739306603

A few years back a quarry company wanted to get aggregate to Auckland from Northland. The barging was a fraction of the cost of transportation by road and with much lower environmental impact. Unfortunately the cost to unload the barges at Ports of Auckland (council owned monopoly) made it uneconomical.

by meh | 12th Feb 25, 3:27pm 1739327271

And the most valuable "work" is the least valued. Our capitalist/societal/cultural values are pretty ass backwards.

Is it really more willing, or a lack of choice, or a different attitude/culture/upbringing?

by Foxglove. | 12th Feb 25, 8:16am 1739301391

Would be interesting as to what percentage of that could be regarded as staples. Just reflected that when I was growing up the only rice on offer was the short grains and thus the dreaded rice puddings. Long grain for quite a while was hard to get, in the SI anyway, recall in the 1960s it was known as Siamese and/or Burmese, but it has been a huge part of our family’s diet from that time.

by profile | 12th Feb 25, 9:08am 1739304510

Ehrlich dead wrong for another year.

Global rice production is now seen reaching an all-time high of 539.4 million tonnes (milled basis) in 2024/25, up 0.6 million tonnes from December expectations and 0.9 percent more than in 2023/24.

by meh | 12th Feb 25, 3:34pm 1739327667

How much of the food security/access/price issue is affected by financial speculation?

Then there's the BS developed world narrative that the poverty baseline is $2 a day or something like that, yet none are capable of living at that level themselves.

by interesting1234 | 12th Feb 25, 9:18am 1739305139

Homemade rice puddings are delish when made correctly, what a treat.

by El Torso | 12th Feb 25, 11:11am 1739311901

LOL, I loved that when I was a kid. Ideally made with full cream milk. I like it with sultanas/raisins, but understand that may be a controversial call.......

by Foxglove. | 12th Feb 25, 11:37am 1739313431

You never met grandma. It was curdly thin, sickly sweet and usually a thick brown charred soggy skin on the top. Couldn’t leave the table without it afraid to say. But take your point. When I was convalescing from surgery, no solids, found the canned stuff now on offer, rather easy and good.

by General Comment | 12th Feb 25, 8:34am 1739302445

Frozen veges are still cheap and a whole lot of them are grown, processed and packaged in Hawkes Bay.*

* Possibly a nuanced comment...

by IT GUY | 12th Feb 25, 8:01am 1739300479

I have been hearing a lot of negative news from NE China, house prices have been crushed, its a traditional manufacturing area and is having a tough time. He needs to give them a good news story, but there will not be the jobs in farming that where there in manufacturing. he has a rust belt problem on his hands.

Many of these workers are from the south, no job and idle hands = not good for social stability.

by RickStrauss | 12th Feb 25, 9:07am 1739304450

Reckon he'll need to dispose of them in a war / invasion of neighbouring countries before they get too old and decrepit?

by Grattaway | 12th Feb 25, 9:25am 1739305550

Russia needs workers - the locals keep dying - or drink to much - or have already fled to a safer country

by murray86 | 12th Feb 25, 8:02am 1739300548

Recall that food security was identified by the US in the 50's as the most likely driver for the start of WW3?

by murray86 | 12th Feb 25, 8:00am 1739300419

Perhaps PDK could consider another outcome of "that 'Final Generation' thing" and the falling marriages could have other impacts.

One of the cultural aspects for the region as i understand it is that families want sons so that they can support their parents when they age. But men are needed for armies. A significant drop in births, a potential secondary effect could put big constraints on China having a large standing military, or actually using it in some military adventurism like invading Taiwan. Armies coming home in body bags, or not at all, may well cause a revolt of the peasantry. The CCP may well be very worried about what is happening.

by IT GUY | 12th Feb 25, 8:08am 1739300932

They crushed the education tutoring business for this reason, people could only afford to have one child as education/tutoring costs so much that people where not able to afford to have two kids. Its such a mess. You can see why , suddenly, physical gold is hot in China, they have lost trust in their institutions.

by Threecents | 12th Feb 25, 9:19am 1739305197

For those interested in the increased demand for physical gold. Most interestingly James is prepared to suggest some answers to issues that nobody else (that I'm aware of) has answered. Keep the cup away from the keyboard.

https://kingworldnews.com/is-the-world-about-to-witness-a-shocking-gold-revaluation/

The anomalies in the gold market over the past couple of months have become widely known. These include the huge spread at which futures and forward contracts are trading over spot, the huge flows of physical metal into the US, as well as the decline in the assets of GLD and some other paper-gold products.

What hasn’t been broadcast is why these anomalies are happening. And just as importantly, why now? Tariffs have been generally dismissed as the proximate cause, even before some of the tariff related tensions started to ease. But the anomalies remain.

So I’d like to speculate on one possible reason for the anomalies and one possible outcome. And I stress it is just speculation, designed simply to open one’s mind to the countless possibilities given today’s unusual circumstances.

by Foxglove. | 12th Feb 25, 8:23am 1739301799

When there’s trouble at home history records trouble is then made abroad to redefine the population’s focus. Don’t believe Taiwan is any more of a target now than it ever has been but for China’s massive military, all dressed up with nowhere to go and logically geared for wide land manoeuvres, there is much to gain to the west and good friend Russia in no position to object.

by murray86 | 12th Feb 25, 8:27am 1739302042

Thing is China has a legacy of having very long views. External adventurism is a short term perspective. The US has demonstrated the consequences of only short term perspectives. Long term consequences can be painful and expensive.

by Foxglove. | 12th Feb 25, 8:48am 1739303294

Thoughtful reasoning. Idle speculation but perhaps in that vein, the flash up with Vietnam in the late 1970s was such a long term marker. Much commentary believed it was mostly about letting Russia understand they wereno longer in a position to involve themselves as before.

by interesting1234 | 12th Feb 25, 9:21am 1739305310

Expansionary, globalised, empire-building goals are usually, historically around 250 year stints before the wheels fall off.

by murray86 | 12th Feb 25, 9:34am 1739306079

Accepted historically but as the US has shown , and history teaches, one must have a force to hold any territory gained. Can China afford to leave large portions of it's military, or alternatively send police units ( or some other paramilitary force) to hold conquered territory. Troops tend to want to go home when the fighting is finished. True liberation will allow that without the need for a holding force, subjugation on the other hand.... Taiwan would be subjugation.

by Grattaway | 12th Feb 25, 9:39am 1739306376

So USA's time is up then?

USSR also didnt last that long - maybe their model was just a bit to murderous

I find it interesting that Trump's new foreign policy seems to be overtly (rather than covertly) all about whats in it for us/me - but in the background I would see that this has always been their policy and actually it is now no different from China's belt and road initiatives which is all about China empire building and economic growth. Not sure that they will put that at risk by invading Taiwan -much easier to start "helping" Russia develop Siberia

by WestieAJ | 12th Feb 25, 10:04am 1739307841

China's nuclear stockpile is the world's third largest. Game that out.

by Kate | 12th Feb 25, 9:58am 1739307481

@murray86, here's a really interesting and relevant website in these globally shaky times;

https://www.globalfirepower.com/countries-listing.php

You can drill down by country by category of military assets - manpower being just one of those comparisons. Very interesting to compare countries.

by murray86 | 12th Feb 25, 10:12am 1739308321

Very interesting Kate. Thank you.

I would point out that military power is not just about numbers. Ukraine has shown that. Leadership, cause and many other intangibles can lead to success or defeat. Tipping points can even come down to pure luck. Indeed talking to a number of veterans, they all say that while training and fundamental skill levels at employing your equipment are important, when the bullets start to fly luck seems to play a big part.

by Foxglove. | 12th Feb 25, 11:45am 1739313906

Military power has always rested its case on deterrence. Hence for example, the naval power race between Great Britain & Germany leading up to WW1. Today the USA and allies operate three to one more nuclear powered submarines than their perceived opponents. Doesn’t really matter as just one would suffice for immeasurable devastation. And again that is the point. Should you attack, then you can expect retaliation in kind and more. Australia’s adoption of these vessels is to the same purpose and Japan’s big uptake in rearmament may well follow suit.

by murray86 | 12th Feb 25, 1:52pm 1739321562

The only way to prevent or avoid war is to prepare for one.

Lots of people don't understand that.

by meh | 12th Feb 25, 4:12pm 1739329950

The biggest fallacy we were taught to believe. It comes from a war mindset not a peace mentality.

Mutually Assured Destruction is not the pathway to peace and harmony.

“I went into the Army believing that if you want peace you must prepare for war. I now believe that if you prepare thoroughly for war you will get it.” – Sir John Frederick Maurice (Military general, 1842 – 1912, England)

by Foxglove. | 12th Feb 25, 5:49pm 1739335747

Or in a similar vein Spike Milligan responding to an officer’s comment, that people like him were no bloody use in war time, then people like you sir, are no bloody use in peacetime. The trouble, is that regardless of the validity and integrity of Sir John’s opinion, there have been, and likely will always be, considerable numbers of not only the opposite mind, but raring to act it out and with the power to do so. That sort of history is neither sparse nor obscure and there is nothing to suggest it won’t recur. Regrettably much of it relies on the premise that the victor will always be in the right.

by K.W. | 12th Feb 25, 1:26pm 1739320011

On the other hand, a war is a great way to use up the excess 35 million unmarried men in China.

https://www.washingtonpost.com/graphics/2018/world/too-many-men/

by kraken | 12th Feb 25, 8:12am 1739301173

The only thing better than watching the 10Y yield move higher is seeing both the 10Y and 2Y move higher.

It looks like the NZ2Y yield is happily bouncing off 3.6% and ready to keep climbing, following a very similar pattern to the US2Y, UK2Y, and AU2Y. We may have already seen the bottom.

If you're worried this may lead to higher mortgage rates or have concerns about Trump and tariffs, just get out there and enjoy the beautiful day we're having. Life’s too short!

Les rendements obligataires vers la lune ! 🚀🥂

by Baywatch | 12th Feb 25, 8:45am 1739303124

Tesla share price hammered today..., should bounce back when the robocars are unleashed /sarc

by IT GUY | 12th Feb 25, 8:54am 1739303686

He needs OpenAI for self steering, his is crap

Its clear that its actually the deep state funding this takeover attempt

by interesting1234 | 12th Feb 25, 9:22am 1739305369

The USA slowly eating itself whole.

by murray86 | 12th Feb 25, 9:38am 1739306299

apparently Trump has speculated on a third term. I know the law says "NO!" But as CT mentioned in his article, it seems he is hell bent on turning the state upside down.

by Kate | 12th Feb 25, 9:48am 1739306899

Indeed, he was more than quick-off-the-mark when answering "NO" to a question from Bret Baier as to whether JD Vance was his pick for his successor. Super quick and an adamant "no".

It will become a North Korean style line of succession and I suspect next in line is his son, Barron Trump.

by Foxglove. | 12th Feb 25, 9:50am 1739307036

Trump seemingly enjoys provoking and then observing the rage of his opponents. It is also a tactical smokescreen. How about this as a suggestion - by the time of the mid terms, the people will realise how great this presidency is and will then return my supporters in enough numbers to the congress and the senate, to change the constitution to allow me to remain as president.

by Kate | 12th Feb 25, 10:00am 1739307604

Unlikely there will be mid-terms.

by unaha-closp | 12th Feb 25, 11:07am 1739311649

After some needed reforms to fortify the elections against fraud and the acquisition of Dominion Voting Systems by Musk Inc. The fairest and greatest American elections ever will certainly take place on time.

Protesters will be locked up as insurrectionists and held in solitary confinement, with jailhouse beatings, until they confess.

by Foxglove. | 12th Feb 25, 11:50am 1739314218

Suggest American terminology in this field, would favour seditionist over insurrectionist. After all Lincoln himself identified such activity as such when he suspended habeas corpus. Somehow there’s always a precedent in need.

by mfd | 12th Feb 25, 11:14am 1739312054

Oh, they'll probably keep elections. The idea is to make them more like the elections in, say, Russia, or North Korea. New playbooks being developed all the time:

https://slate.com/news-and-politics/2025/01/north-carolina-supreme-cour…

"He is asking the courts to throw out tens of thousands of votes that were entirely legal under the rules in place at the time of the election."

by Snow | 12th Feb 25, 12:58pm 1739318332

Given your role in Massey I'm surprised by your comments along these lines. Expecting the States to be led by a Trump family dictatorship is something a the right-wing conspiracist nutter would trot out. It's beneath you Kate.

by fra99le | 12th Feb 25, 1:22pm 1739319739

Time will tell. But it's a possibility.

by K.W. | 12th Feb 25, 1:29pm 1739320160

Suggesting that Barron Trump is next in line is completely unhinged. Everyone knows it will be Don Jr.

by Kate | 12th Feb 25, 1:31pm 1739320316

Hahahaha. Nah, too much of a known-to-make-a-fool-of-himself quantity :-).

by Independent_Observer | 12th Feb 25, 2:06pm 1739322389

Id put a punt on Trump recommending Tulsi Gabbard, Kate - the ex-Democrat, like himself.

by Kate | 12th Feb 25, 9:42pm 1739349739

We should run a sweep - the sort of thing done for the Melbourne Cup. How many 'runners' do you think would be appropriate. So, Tulsi and Barron make two so far :-).

by Kate | 12th Feb 25, 1:29pm 1739320196

You want to watch the clip from the interview yourself;

https://nz.news.yahoo.com/donald-trump-asked-views-j-001258634.html

Scroll down for the video clip.

That's the first time anyone on here has called me a right-wing nutter :-).

If anything I'm a progressive nutter and to my mind this President wants to take the US backwards in history - although he's not that good at really knowing what he's referring to!

https://edition.cnn.com/2025/01/25/politics/trump-golden-age-gilded-age…

by Independent_Observer | 12th Feb 25, 1:42pm 1739320937

Agree - I usually highly respect what Kate has to say but apparently because I’m in support with the majority of Americans who are in agreement with what Trump (and Musk) are doing, I’m also heading down the path of being an authoritarian.

What Trump is doing is exactly what he campaigned upon and was elected to do via a democratic process - there isn’t anything authoritarian about that. What the democrats are doing is fighting against the will of the majority of the voters - ie undemocratic (is this authoritarian - using the courts to deny the will of the majority of the people and their election desires?). If Trump begins to refuse the will of the majority of the people and refuses the next election result, for example, then I will agree with Kate. But for now, I think she like other progressives/social liberals seems to lose their coherent minds when Trump is around because they can’t control him (and control and bureaucracy and the state level appear to be what progressives/socialism liberals love over all else) Musk and Trump (and probably RFK-Jr appear to be their kryptonite that causes hysteria).

by RickStrauss | 12th Feb 25, 2:18pm 1739323112

What Trump is doing is exactly what he campaigned upon and was elected to do via a democratic process - there isn’t anything authoritarian about that.

That's an odd connecting of ideas. Authoritarian action can and has followed democratic election in the past.

If a court rules an action unconstitutional, is that authoritarian to your mind, or do you believe the President should not be limited by courts and constitution? Some might suggest that is seeking or endorsing a King, a more authoritarian model than a President.

by E46 | 12th Feb 25, 3:48pm 1739328537

That's an odd connecting of ideas. Authoritarian action can and has followed democratic election in the past.

Some of the worst atrocities ever committed followed a democratic mandate.

by Kate | 12th Feb 25, 9:44pm 1739349890

If Trump begins to refuse the will of the majority of the people and refuses the next election result, for example, then I will agree with Kate.

Isn't that exactly what he tried to when Biden was elected?

by meh | 12th Feb 25, 4:24pm 1739330640

Wouldn't it be a left-wing conspiracy?

by Baywatch | 12th Feb 25, 10:09am 1739308169

Your delusional sorry...the carnage sown and we are not even 2 month in?

by rastus1 | 12th Feb 25, 11:11am 1739311862

I don't think most here appreciate the support for Trump and what he is doing via Musk and so on. MSM have taken their position, as they have done with Seymour. Being a middle of the road swinging voter it p##s me off.

by RickStrauss | 12th Feb 25, 12:06pm 1739315174

It does seem so unfair to publicise their acts and statements!

by Kate | 12th Feb 25, 1:38pm 1739320727

Yes, and that won't last much longer. First to lose their broadcast license will be CBS;

Trump also upped the amount of claimed damages, with him now doubling the size of his claim to $20 billion, which exceeds the cost of all spending in the 2024 election.

https://nz.news.yahoo.com/donald-trump-amends-cbs-lawsuit-063749736.html

And I'm betting it gets re-assigned to Joe Rogan.- as Trump needs a free-to-air Fox;

https://nz.news.yahoo.com/rogan-democrats-still-saying-stupid-153316908…

by K.W. | 12th Feb 25, 1:33pm 1739320394

NZ media clearly on the wrong side of history. Maybe defer to the opinions of the people who actually live there.

https://www.usatoday.com/story/news/politics/2025/02/09/cbs-news-poll-t…

by Independent_Observer | 12th Feb 25, 1:45pm 1739321157

Exactly but apparently winning a democratic election and delivering the change the majority of people wanted (to get away from excess government bureaucracy and spending) are the signs of an authoritarian dictatorship. The left/progressives have lost touch with reality in my opinion. The last four years of Biden and his extreme left policies seems to have left them stuck viewing the world through an Overton window that has just been demolished and thrown in the trash. Seeing the world through the new Overton window is obviously going to be painful.

by RickStrauss | 12th Feb 25, 2:19pm 1739323171

apparently winning a democratic election and delivering the change the majority of people wanted (to get away from excess government bureaucracy and spending) are the signs of an authoritarian dictatorship.

If there's a need to strawman like that it suggests a weakness of argument.

Secondly, I would agree with Democrats failed to inspire and to shift to engage with younger generations' needs - as while they seemed to do okay bringing down inflation from the COVID response years and ushering in sharemarket success, they seemed to fail to connect on rising house prices and economic struggles of the everyday folk.

But what of Biden's policy changes do you regard as "extreme left"? Especially given the USA is broadly to the right of New Zealand, with our universal pension et al.

by meh | 12th Feb 25, 4:57pm 1739332629

According to Overton, the window frames the range of policies that a politician may recommend without appearing too extreme to gain or keep public office given the climate of public opinion at that particular time

Does the theory have any basis of truth to it given how easy the public are influenced by propaganda? Voting for a change of party because one hates the previous one doesn't exactly highlight sound reasoning. Fear mongering has been a well used "public relations" strategy in recent years.

Electing a convicted felon who threw a tantrum for losing a democratic election sort of shows the level of reason and critical thinking of the majority.

Trump displays a classic "do as I say, not as I do", which could be considered highly authoritarian. He exhibits behaviour that would appear high on the narcisstic spectrum - highly authoritarian.

by Yvil | 12th Feb 25, 2:30pm 1739323840

"apparently Trump has speculated on a third term"

Trump is currently challenging Constitutional law. Even if Judges find some of Trump's decrees unlawful, they may not be able to stop him. This is a very serious worry, because it's a step towards dictatorship. Next could well be the Fed's independance, and after that, Trump can just decree that he will be president for however long he likes. This is very reminiscent of a certain A Hitler, the real worry is that no one can stop the USA's military might, if the madman gets into a dictatorship role.

by mfd | 12th Feb 25, 1:26pm 1739320009

Yes, it's very concerning. This isn't just a bureaucratic tidy up.

https://www.politico.com/news/magazine/2025/02/11/jd-vance-trump-execut…

'“Judges aren’t allowed to control the executive branch’s legitimate power,” Vance wrote in a post on X'

They literally believe that Trump should be able to do whatever he wants, unencumbered by existing law or the Constitution.

by AN Other | 12th Feb 25, 1:45pm 1739321136

They literally believe that Trump should be able to do whatever he wants, unencumbered by existing law or the Constitution.

Didn't the US judiciary (Supreme Court) decide that he was immune from prosecution for anything he did while acting as El Presidente?

by mfd | 12th Feb 25, 1:47pm 1739321238

Yes. So we have a situation where the Supreme Court will make rulings to restrict his power, in line with the constitution and other laws, and he can ignore that with no repercussions. And this is exactly what is planned.

I know the comparisons to the fall of the Roman Republic are generally overplayed, but the way that congress, senate and judiciary are rolling over in the face of the power of a single man is very familiar. Is everyone looking forward to the founding of the American Empire?

by Independent_Observer | 12th Feb 25, 1:59pm 1739321972

Like the British Empire? You know, the thing we were part of that Colonised the world under the rule of a King or Queen? That in which we once took great pride in?

Are you saying empires are evil and therefore the foundation of NZ from its empire is evil?

by RickStrauss | 12th Feb 25, 2:21pm 1739323310

How would the existence of Kings and Queens in the past justify defiance of the Constitution now, to your mind?

by Foxglove. | 12th Feb 25, 2:44pm 1739324645

Colonisation has evolved into a dirty word. Yet it has been a reality, before recorded time, of human behaviour by conquest, migration and even forces of nature itself. Shaka’s Zulus or Genghis Khan’s Mongols are but two typical examples of imperialism so to speak. Get land, subdue incumbent and exploit said land and people. Don’t really understand the outcry, as if it was novel and selective foul play, today because, even though some might regard modern civilisation as being a sufficient discipline , nothing has actually happened to prevent recurrence as all the various conflicts round the globe presently evidence. Not justifying anything here, just attempting to define a reality. Yes NZ was colonised but not alone and so too well beforehand the mother country, by Celts, Romans, Saxons, Normans and possibly Germans too if Adolf had prevailed.

by mfd | 12th Feb 25, 3:51pm 1739328680

No, I don't think so. By the time of Empire Britain had a strong Parliament that wielded power alongside the monarch. Powers steadily gained over the centuries through negotiation and conflict. The Roman Empire still had a senate, but it was doing little more than rubber-stamping what the Emperor wanted.

I would say that rule driven by a single person with unchecked power is inherently dangerous as eventually you end up with a ruler that isn't competent, or is mentally ill etc. Single point of failure vs a system of balanced power between a few different systems.

by Kate | 12th Feb 25, 9:50pm 1739350206

Here's a great site to follow on that, Yvil;

https://www.justsecurity.org/107087/tracker-litigation-legal-challenges…

by ChrisOfNoFame | 12th Feb 25, 3:01pm 1739325705

interesting1234 : "The USA slowly eating itself whole."

And yet we continue to feed it?

In fact, this isn't - or shouldn't be - a surprise to anyone. The USA has a massive money washing effect that has been operational for 50 plus years. I.e. the wealthy in EVERY OTHER country 'tax washes' their money via the USA.

by Pa1nter | 12th Feb 25, 8:58am 1739303897

They're leading in self driving.

Also in unrelated news, Waymo, a company that's already actually doing commercial self driving taxis, has teamed up with Uber, a world leader in commercial private transport.

by Baywatch | 12th Feb 25, 9:00am 1739304004

They're leading in self driving...perhaps and if you can afford it?

by Pa1nter | 12th Feb 25, 9:43am 1739306584

I'm critiquing JCs justification for the share value.

They were leading in EVs, now they're sharing a crowded market with huge downward pricing pressures

And that's about it

by Grattaway | 12th Feb 25, 9:30am 1739305857

In Shenzhen recently and driverless cars were already on the road

by Zwifter | 12th Feb 25, 11:13am 1739311993

China has already overtaken the USA and its scaring the shit out of them. The problem for the rest of the world is that when the USA doesn't like something they try and fix it by force.

by Kate | 12th Feb 25, 9:41am 1739306495

And in a shameless move, the US President has ended enforcement of the Foreign Corrupt Practices Act,

Of course, as he's the Bribester in Chief now.

Next move will be to grant pre-emptive pardons to all his Cabinet and senior departmental officials so that that cannot be held in contempt of court.

by RickStrauss | 12th Feb 25, 9:47am 1739306875

That's truly an incredible move.

Will be interesting to see how his worshipful crowd spin it as something upright.

by Kate | 12th Feb 25, 10:06am 1739307968

Oddly enough, I don't know that most Americans worry about there being no rule-of-law anymore. As Trump said after the elections, "groceries" was the magic word. So if he brings the cost of food down somehow, I suspect that will satisfy many that an "anything goes" is just fine.

And, when I said this to my son living in the USA this morning - he immediately sighted Biden having set the precedent for pre-emptive pardons - and he's not wrong there.

Generally, many, many Americans are in a state of anomie

by JimboJones | 12th Feb 25, 10:28am 1739309322

Amazing what they get away with. So pleased we don't allow our politicians to do whatever suits them, many of the things Biden and Trump have done would be career ending in NZ, maybe even the end of the entire party.

by powerdownkiwi | 12th Feb 25, 10:46am 1739310390

Oh, yes we do.

And are.

Largely because of a sycophant media

by Pa1nter | 12th Feb 25, 11:10am 1739311858

sycophant media

I'll put 50 cents on that and 50 cents on shared psychosis.

by kiwikidsnz | 12th Feb 25, 11:43am 1739313822

"sycophantic media"...?

Hardly. It appears that TV1 has decided that Maiki & Benedict are supremely qualified to run NZ without election, given their nightly commentary on the numerous ways the Coalition is failing to do so & what it “must” do to “urgently” fix matters to TV1s satisfaction.

by Foxglove. | 12th Feb 25, 1:33pm 1739320386

TV1’s objectives seems relatively simple though. More staff, more pay, less work, complete autonomy and no accountability and above all else, our positions are sacrosanct.

by RickStrauss | 12th Feb 25, 12:07pm 1739315233

You make them sound like Elon Musk!

by Foxglove. | 12th Feb 25, 12:17pm 1739315825

No just stalwart members of the Brown Cardigan Brigade. Proudly under the motto - “ Omnes Auctoritate, Nihil Responsabilitas.”

by RickStrauss | 12th Feb 25, 2:22pm 1739323371

Ah, like someone who wants to privatise the profits and socialist the costs.

by Foxglove. | 12th Feb 25, 2:27pm 1739323676

Not quite but in a similar way perhaps as my father described a few, but only a few, of his fellow officers serving in WW2 - there are those that will always be in the front ranks for the medals but well behind the lines for the action.

by Kate | 12th Feb 25, 10:53am 1739310787

Yes, I suspect it would be the end of the entire party - and as many Republicans will tell you, the GOP is indeed no longer, it has been taken over by MAGA.

I wonder if Trump will change its name too? Just like the Gulf of Mexico - which now reads Gulf of America is you are accessing Google maps from the US. I find that scary, whereas my son (living in the States) finds it silly.

After all, China muscled many airlines to change their booking names for flights into Taiwan to flights to Taipei. Check it out on Air New Zealand - it doesn't recognize the name Taiwan. NZ would have been one of the first to comply given our trade relationship with the CCP.

by unaha-closp | 12th Feb 25, 10:47am 1739310427

Yes, he will be maintaining the normal standard of American politics.

by kiwichas | 12th Feb 25, 12:08pm 1739315332

MSM suppression/suppression of all facts, promotion of Fox News Truth social etc

Appalling

https://www.nzherald.co.nz/world/donald-trumps-blueprint-for-bending-th…

by KiwiinSpain | 12th Feb 25, 9:53am 1739307217

Humans tend to not react overly well to mandated restrictions of freedoms. China's birth plummet is to be expected. As is NZ's socio-economic matrices falling off a cliff. Maybe your average Chinese Citizen was more accommodating of being locked in a shoe box apartment than his Kiwi counterpart; the impact is relevant to baseline.

by Pa1nter | 12th Feb 25, 10:28am 1739309331

Don't underestimate culture.

In East Asia, birth rates have dropped almost in synch, despite the nations involved having varying government types and economic fortunes.

by K.W. | 12th Feb 25, 1:38pm 1739320698

Was speaking to two Chinese people recently, they said there is an unprecedented level of anger amongst Chinese people at the moment after being locked up in their apartments for three years. Everyone saw people jumping from their balconies. So no, they were not more accommodating, and I imagine the consequence of having done it has yet to be completely understood.

by ChristineAbcm | 12th Feb 25, 10:36am 1739309787

As 2024 is considered an unlucky "widow year" in Chinese culture, it's natural to expect a decline in marriage rates. If you're unaware of these cultural nuances, please refrain from making baseless comments

by AN Other | 12th Feb 25, 12:11pm 1739315463

So when was the last unlucky widow year - have there been any since 1986?

As mentioned in the relevant paragraph, "after rising slightly in 2023, marriages fell sharply in 2024 and to their lowest since China's public records began in 1986."

by ChristineAbcm | 12th Feb 25, 12:53pm 1739318000

Hi, thanks for the response. I think you may have misunderstood my point. I was trying to provide another dimension as to why the marriage rate dropped so rapidly in 2024. I’m not here to argue against the overall declining trend.

The decline in marriages is tied to China's rising higher education and urbanization. they are graduating more engineers and scientists then the world combined, and this is how they have managed to leap frog industries after industries....

by K.W. | 12th Feb 25, 1:43pm 1739320989

Still doesnt change the fact that fewer marriages means fewer births. Because its also a cultural nuance that Chinese dont have babies out of wedlock. Meanwhile, Chinese young people are free once more to go overseas to work and study. And by looking at other countries immigration statistics, its also clear they have gone. Question is, will they ever return to China?