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New Zealand plunges into recessionary spiral

macrobusiness.com.au

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Re: New Zealand plunges into recessionary spiral

#11

Post by formerkrogemp »

flog wrote: post #8
jamesvnz wrote: post #3

That's a rather sensationalist headline. Written by an Australian looking at graphs, rather than having a feel for what's going on. I'm sure he's a capable economist, but based on what I see, New Zealand is not "plunging". There's definitely a slow down - but I think most businesses are expecting a relatively soft landing. I guess time will tell.

Judging by my inability to get into any store at Westgate last weekend due to the crowds, I think we're still a while off "plunging". /anacdata

As it's been explained to me, we're in a demand shock with more or less normal supply constrained by logistics problems.

Re: New Zealand plunges into recessionary spiral

#12

Post by lostlogin »

hn_throwaway_99 wrote: post #7

One clarification if you're not familiar with New Zealand banking. The article states: > Last week, Bank of New Zealand warned that “things could well and truly turn to custard” as the global economy is plunged into recession. I read that and thought "Holy hell, central bankers in the US are usually extremely measured in their comments, they would never say something like 'things could well and truly turn to custard'…

> Bank of New Zealand

And here is the funny bit, it's Australian owned. If it's anything like the rest of the market which is dominated by Australian banks, it'll pay some old kiwiana type music when you are on hold and say 'Kia Ora' or similar at regular intervals. Kiwi as.

Re: New Zealand plunges into recessionary spiral

#13

Post by zinckiwi »

mmazing wrote: post #10

Wow! That's a lot of variable rate or only temporarily fixed rate mortgages! I'm certainly no expert in all of this, how does that stack up with other countries data?

In my experience the concept of a 30-year fixed mortgage is uniquely (or close to it) American. Certainly in NZ anything beyond a two-year fix is rare.

Re: New Zealand plunges into recessionary spiral

#14

Post by potatochup »

lostlogin wrote: post #9
jamesvnz wrote: post #3

That's a rather sensationalist headline. Written by an Australian looking at graphs, rather than having a feel for what's going on. I'm sure he's a capable economist, but based on what I see, New Zealand is not "plunging". There's definitely a slow down - but I think most businesses are expecting a relatively soft landing. I guess time will tell.

If you skim headlines it's much as you say. Interest rates rising (but still around historic averages), falling house prices and high inflation. https://www.rnz.co.nz/topics/business-economy

> falling house prices

Good?

Re: New Zealand plunges into recessionary spiral

#15

Post by plantain »

jamesvnz wrote: post #3

That's a rather sensationalist headline. Written by an Australian looking at graphs, rather than having a feel for what's going on. I'm sure he's a capable economist, but based on what I see, New Zealand is not "plunging". There's definitely a slow down - but I think most businesses are expecting a relatively soft landing. I guess time will tell.

I'm not commenting if they're wrong in this case in particular, but Macrobusiness's business model is sensational/doomer headlines funnelling into their private newsletter.

They may look prescient if you read the last years publications, but they well and truly live up to the joke "Economists have predicted nine of the last five recessions."

Re: New Zealand plunges into recessionary spiral

#16

Post by myth_drannon »

Waterluvian wrote: post #2

I'm sensing this tremendous tension and anxiety in Canada too. Hopefully our energy sector will buoy things a bit so they don't get too terrible.

They just posted the job numbers for October and it was +100k, blew through the roof. All this doom and gloom is to push the central banks to calm down and stop raising the rates.

Re: New Zealand plunges into recessionary spiral

#17

Post by billforsternz »

flog wrote: post #8
jamesvnz wrote: post #3

That's a rather sensationalist headline. Written by an Australian looking at graphs, rather than having a feel for what's going on. I'm sure he's a capable economist, but based on what I see, New Zealand is not "plunging". There's definitely a slow down - but I think most businesses are expecting a relatively soft landing. I guess time will tell.

Judging by my inability to get into any store at Westgate last weekend due to the crowds, I think we're still a while off "plunging". /anacdata

Similarly my anecdata is how hard it is to find a car park in the allegedly in decline Wellington CBD and then how difficult it is to find a restaurant that isn't overflowing with happy diners and consequently incapable of accommodating us.

Re: New Zealand plunges into recessionary spiral

#18

Post by hedora »

Figure 9 looks dire: 95% of mortgage (by total value, not count) are going to have their rates adjusted in the next three years; 56% in the next year.

In the US, that'd definitely lead to a housing crisis worse than 2008. Is there something different about how houses are purchased in NZ?

Re: New Zealand plunges into recessionary spiral

#19

Post by abeppu »

As an American I was struck by the graph of mortgages by fixed term length. I guess I've always heard that US home buyers are constantly benefiting from policies propping up 30 year fixed mortgages, and I knew that other places this wasn't the norm. But it's surprising to me that a majority of mortgage debt in NZ is fixed for less than 1 year. Even in years that don't see rapid interest rate changes, this must make it very hard to plan.
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