Posts by Swan
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Polity: Hosking’s right about jobs, in reply to BenWilson,
Ben, if we had a supply shock we might have unemployment and high inflation, but that obviously isn't the current situation, it is fairly well recognised we have a lack of demand. It is arguable that things get difficult when we get near the ZLB but that isn't the case for NZ They have full control of our fiat money supply. They've gotten it wrong and that is a major reason for NZs high unemployment.
It might be reasonable to say ex ante it was difficult to be definitive about the appropriateness of monetary policy, but the result over the last few years are a matter of fact.
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Polity: Hosking’s right about jobs, in reply to william blake,
The actual interest rate alone doesn't determine whether or not monetary policy settings are appropriate for a given situation. An OCR of 4.5% might have been too low in the mid naughties, just as an OCR of 3% has proved to be too high recently. We have had low inflation for I think about 6 years, and similarly high unemployment. Therefore, monetary policy has been too tight.
Note that the RB hasnt ever said that they expect inflation to remain low and unemployment to remain high. They have always been predicting, with their policy settings, a swift return to target inflation. They have been wrong for 6 odd years now. They have had to reverse interest rate rises they made twice in that period.
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Polity: Hosking’s right about jobs, in reply to Rich of Observationz,
Well, Labour: one of the main reasons for unemployment is that interest rates are set too high for the real economy, the reason they have to be high is to stop Auckland house prices rising faster that they are already, and the reason house prices are rising is that income from house price speculation is tax free.
I agree interest rates are too high. Inflation figures have repeatedly undershot their target over many years. If the reserve bank is keeping interest rates high because of house prices, they are going way outside what they should be doing. There mandate is to keep inflation at the midpoint of the target band. If they are worried about the effects of high house prices on financial stability, which they appear to be, they have plenty of effective options other than killing the real economy, including setting capital requirements for the banks.
So labour could say they will sack the governor and get in someone competent, or perhaps move to a level target. So they have options in that space, I think the cgt is a red herring here.
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Hard News: The Message, in reply to Sacha,
More housing = more overcrowding? Wow, that's an impressive leap of logic.
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Hard News: The Message, in reply to Sacha,
Yes apparently he doesnt want to much intensification in the nice areas of Auckland. But New Lynn and Panmure are OK apparently. So a Snob, as transportblog says, and essentially siding with the Nimbys. Very disappointing.
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"Your Rosedale plant means squat for rates, because it’s paid for by metered water"
Also on this. Wastewater was included in rates pre amalgamation on the shore so maybe get your facts straight.
Do you think Watercare will be able to fund CI and NI out of meter charges?? I dont think so.
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Hard News: After Len, in reply to Matthew Poole,
Yes the token amounts it costs to keep Motat etc going is fairly immaterial compared to wastewater. As for regional parks these were funded by the ARC which all areas paid into equally. I think your idea that the NS was a bludger is misinformed and inflammatory frankly.
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Hard News: After Len, in reply to Russell Brown,
Russell, the purpose of a business case is to determine whether a project is go or no go. The government has committed to a business case and funding, one assumes, subject to the results of the business case. The designation was driven by the council, and the construction is only early works with no certainty around the bulk of the funding.
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Hard News: After Len, in reply to Matthew Poole,
Matthew, what regional infrastructure did the North Shore not contribute to? The NS has sorted out its CSO's well in advance of the Isthmus (the bill for which is in the billions), and built extra capacity in its wastewater system that is now being snapped up by the rest of Auckland. Wastewater, alongside local roads is at the core of what councils do and the North Shore was way ahead of the other three large councils.
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Hard News: After Len, in reply to Russell Brown,
"On 28 June 2013, the Prime Minister announced the government is committed to a joint
business case for the City Rail Link in 2017 and providing its share of funding for a
construction start in 2020"http://www.transport.govt.nz/assets/Uploads/Rail/akl-city-rail-link-briefing-redacted.pdf
I couldnt find the original press release but that is the summary from the MOT. So we havent had the definitive business case yet.