Bernard Hickey

I see the Herald has an article that quotes Bernard Hickey and other commentators where they are surprised that banks are offering freebies for people to sign up new loans – “buying your business with your money”.

Flat-screen televisions, cash for groceries and even iPads – banks are competing to offer more attractive prizes to sweeten home loan deals as higher interest rates are forecast.

But commentators warn the prizes should be viewed only as a bonus once a loan has been settled.

One says the giveaways are “essentially buying your business with your money”.

With little separating their advertised fixed mortgage rates, banks are dangling “free” giveaways to lure prospective customers from rival banks.

Oh how terrible…

Dr Claire Matthews, of Massey University’s centre for banking studies, said people should study the entire home loan deal – including fees, terms and conditions – before being tempted by cash or giveaways.

“It might be that if you’ve got two banks that are almost identical, and one is offering a 52-inch television, then, hey, you might as well go for the television as well.

“But if somebody is offering a better deal, despite the 52-inch television you may not be better off.”

Economic commentator Bernard Hickey said similar giveaways were seen during the 2002-2007 property boom.

“But then, the banks tended to simply use price as their main way to win market-share. This time, they are being a bit more cautious about that, mainly because they want to preserve their profit margins.

The cost of such incentives were often simply added on to the mortgage, Mr Hickey said.

“What they are doing with these offers, is essentially buying your business with your money.”

And what about the Herald? They offer free stuff to win subscribers…plus their reader promotions…they even use a call centre to beg people to stay with free newspapers.

What a bunch of sanctimonious hypocrites.

Labour follows closely behind the UK in its policy making. In the UK they have the Fabian Society and a branch has been formed here in New Zealand for hard core Labour lefties.

Selwyn Pellett, Bernard Hickey and David Parker et al are all either members or contributors of the Fabians in New Zealand. One wonders if they will take the lead of the UK and implement a policy like that proposed over there…raising taxes off of the back of those filthy rich pensioners?

Pensioners’ taxes should increase, their benefits be cut, and a tax on property wealth should be introduced in order to share the pain of austerity with today’s hard-up workers, a think-tank said today.

The income gap between pensioners and workers has shrunk massively in the last few decades, so taxes should be raised on those in retirement, the Fabian Society said.

Middle-income working households enjoyed an income 93 per cent above that of middle-income retired households when Margaret Thatcher came to power in 1979, but that figure is now 37 per cent.

High-levels of home ownership among older people means the older generation are in effect far better off, as middle-income workers’ wages now stagnate and they cannot afford to buy a home.  Read more »

At Quadrant Online, Gina Rinehart blogs about Rupert Murdoch’s speech to the Institute of Public Affairs:

I arrived in Melbourne in good time to neaten up for a dinner function celebrating the IPA’s 70 years. Although it seems a long way to fly from Tokyo for dinner, it was fantastic to see so many friendly and enthusiastic people. Thank you to all the friends and new friends who came to chat with me.

I spoke briefly, but it was the other speeches that made the night so worthwhile, including the address by IPA award winner Rupert Murdoch. He said the sort of things Baroness Thatcher would have appreciated because, like him, she strongly believed free societies are moral and socialism is not.

The speech she was talking about said this in main:

How often have you elected political leaders to fight against some horrible regulation or tax, only to watch as they basically agree to a watered down version of what their opponents are arguing?

Placating a nation is not leading a nation.

So long as we allow the debate to be framed by people who think the market is efficient because it is based on a human failing, we are going to lose every argument.

The only way to uphold market freedom is to show people that the market doesn’t succeed because of greed. In fact, it’s just the opposite.

The market succeeds because it gives people incentives to put their own wants and needs aside to address the wants and needs of others. To succeed, you have to produce something that other people are willing to pay for.

Of course the socialists would have you believe otherwise.

Matt Ridley is a British author who has given great thought to these issues. He wrote a famous book called The Rational Optimistthat many of you must know. He points out a few simple facts:

First, that today by almost any measure you can think of, people on this planet are better fed, better sheltered, and better protected than they’ve ever been – and that prosperity has really accelerated in the last 100 years. lndeed, that the average person’s standard of living has improved ten fold – yes, ten fold – in the last century.

Second, he says that the key is simply trade, or the interchange of goods, services, and ideas among people.

Let’s put this in human terms. Recently the World Bank reported that in 1981, 42% of people in the developing world had to live on less than a dollar a day. That is one-and-a-half billion people in poverty or starvation.

Thirty years later, the percentage has been reduced to 14%, a huge change in a relatively short period of time. What could be more moral than that?

This is unparalleled in history.  Read more »

Bernard Hickey and his Labour party pals won’t be happy about this from the IMF.

IMF managing director Christine Lagarde was full of praise last night for the direction in which the New Zealand economy was headed.

After meeting Prime Minister John Key on the fringes of the Bo’ao Forum for Asia, in China, she talked to New Zealand reporters about the general health of the economy in light of a recent assessment of fiscal and monetary policy.

“All I can tell you is the IMF is very supportive of what is being done by the Government in that respect.  Read more »

The latest Truth is on sale today.

News:

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Sport:

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Read more »

Wow, what a guy.

Fresh from telling anyone who’ll listen that NZ’s biggest problem is its addiction to property, Bernard Hickey is now telling punters to get in quick to borrow against their home.

It seems that Esteemed Bill English (or Wiremu Pakeha as he is known as in Tuhoe) and the Reserve Bank is soliciting feedback on Loan value ratios, or LVRs.

This means that banks may not be able to loan more than a certain amount on a home, maybe 80%. (You will remember in the property boom 5-10 years ago, you could get 105%, because you needed a plasma TV to go with your Grey Lynn villa).  Read more »

Another prediction fail from Bernard Hickey…I wonder if he will honour his bet, he should do now he is cashed up.

I will bet the first 5 tweet responders a Herne Bay flat white we’ll see a banking crisis in the Nthn Hemisphere in September. Any takers?

— bernardchickey (@bernardchickey) July 13, 2012

A reader emails:

I saw your recent post on Bernard Hickey.

It reminded me of something that was been bothering me:

Apparently Hickey is a property and finance guru.

This is the same Hickey who in 2007/2008 predicted that property prices would fall 30%. Then when that never happened, revised it to be a fall of 15%.

I think house buyers and bankers are irrational enough to ensure the national median price measured by REINZ does not fall around 30% to around NZ$250,000 from the peak of NZ$352,000 in November 2007 as I originally predicted. The external factors that I thought would jolt the market back to reality have not happened and now look much less likely to happen. I now think the median is likely to fall to a trough of around NZ$300,000 by mid 2012, which is about 15% below the peak and 11% below the current level of NZ$337,500.

I loathe tl;dr (too long; didn’t read) posts but over this issue I will do one as paying (or not) for content online is the most important issue for the future of bloggers and new media and one I have put a great deal of thought into both for The Truth and this blog.

When Bernard Hickey announced with much fanfare and bravado he was setting up www.journalism.org.nz others were telling Hickey what he wanted to hear but I was instantly skeptical at the stunt and said so in full.  Socialists do not part with their own money and this was a left wing vehicle.  Hickey skited he would cover stories other MSM would not.

The first issue was Hickey’s arrogant attitude to the project and relationship with www.interest.co.nz.  I continue to write this blog and am editor of The Truth.  I cannot do both jobs without help and appreciate the staff at The Truth for their work so far.  It is not as easy as it looks but I am spending less time on it as I learn the job.  Surely Hickey could see the level of time required, most of it on his own?

The second issue was Hickey clearly relied on the unreliable in Selwyn Pellett.  A wealthy man but not one who parts with coin as freely as others on the right to fund projects like this.  A man with his own agenda who spends a disproportionate amount of his time arguing senselessly on Twitter as a “critical friend” of the Labour Party.

Selwyn Pellett claims to not be a member of the Labour Party but tweeted attendance at the recent Annual conference.  John Tamihere was not a member at the time and not allowed.  Pellett is a “critical friend” who does not even believe enough in the Party to join it.  It shows a level of commitment that equalled his to Hickey.

So Bernard Hickey cans the project the same week he sells his Epsom home for $1+ million and moves to Wellington, for no apparent reason than his daughter is at University there.  Hickey’s reasons were:

1. Underestimating the time and salary sacrifice involved

Every small business needs cash to start-up.  Most have a period where the owner receives no income.  Hickey left interest.co.nz according to his original release on 1 November.

Why didn’t he release the website idea with a breaking story to show what he would produce?  Fact is he hasn’t had one memorable toe-curler since the Crafar farm face-off.  He has limited his role in the media to commentator/Labour parrot and Herald on Sunday columnist.

I have come to the conclusion that the need to support my family through freelance journalism and commentary will not leave sufficient time for me to continue to take the lead role in journalism.org during its formative stage.

In other words, despite grossing $1+ million on the house according to NBR, he was not prepared to do what most small business owners have to do and mortgage the house to back himself and put equity into the new venture.  Not having enough time to devote to the project and wanting to spend more time with his family are euphemisms for “I should have thought more about it before chucking my toys at interest.co.nz and bragging I could do this”.

2. Everyone lied about paying for the start-up

We will have to fight for funding in an economic environment where philanthropy is less evident than in more prosperous times and where we need to be wary of the difference between verbal commitments to donate and actually putting a hand in one’s pocket.

The economic environment really has nothing to do with it.  According to Hickey the economy has been in crisis for years. The bottom line is that people will not front with cash until they see what is on offer on the website.  The NBR for example created their online product BEFORE people signed up.  Even on Hickey’s online poll on the website there was fair indication not many people were interested enough to click a box.  Everyone will slap you on the back congratulating you and saying they will sign up because it is easy to say that.  Most are lying, especially socialists. I have told Hickey what to do, break a big story to launch it in style, not a whimper and fizz.

3. Pellett must have pulled out

He had previously acknowledged it was risky to rely on one large donor – if they lost interest or wanted to make the site a vehicle for their own views.

You do not have to be a genius to see what happened.  Hickey found out Pellett is a control freak and wanted to push his own agenda.  He has some awfully weird ideas that even Hickey could not suffer.  Remember Hickey predicted a 30% drop in house prices at one point, then changed his mind?  His commentary is all over the place and unrealistic.  Hickey’s effort on Sunday is a perfect example.  There was no real reason to write that column.  It lacked purpose and was merely parroting prior World According To Bernard Hickey.  To be blunt, Hickey has gone stale.   He has pigeon holed himself into a ridiculous prediction man.  The latest large failure was predicting the Eurozone would collapse in October 2012.    Compare Hickey to Fran O’Sullivan who does not go around  making outrageous (incorrect) predictions to get attention.  She produces an endless stream of new material and perspective twice a week and has done for decades.

Hickey has now worked out precisely why New Zealanders just buy property and wait for it to appreciate in value as an investment before selling it.   He has written about potentially becoming a property investor.

While there is no shame in business reporters not being in business themselves, the massive miscalculation of  start-up capital and funding is facepalm material.  The only people interested in Hickey’s sort of alarmist Chicken Little stories are people who will not pay for the news.  They are also as I have said, socialists and as I told my new largest new fan; grumpy, old media Brian Edwards unequivocally on The Nation – socialists do not part easily with money and make terrible paymasters.  It is why his now political polar opposite and my largest new critic ; grumpy, old media Bill Ralston, got realistic about life and changed his colours.  Capitalists and corporates pay the bills.  Socialists just want everything for free.

Or do they?

Keith Ng scored how much for writing about a planned hack? But even at several thousand dollars a story in funding and donations from the public it will never be enough to fund Hickey’s lifestyle full-time given the amount of time you have to put into a story.  As I have found in my new position as an Editor  it takes enough time at The Truth to get everything out each week, let alone produce investigative reporting where you may spend hundreds of hours for nothing.  Phil Kitchin for example is testament to three stories a year max, and he has scraped the barrel from his semi-retirement this year in quality after doing precisely what investigative reporters do not and allow themselves to be captured and kidnapped by a PR hack.  David Fisher has gone soft and is filling his Herald space interviewing Kim Dot Con’s hired help.

Hickey also insulted large chunks of the business mainstream media by all but saying they were in the pocket of corporates so not doing their job as well as he could independently. They will all be chuckling at his failure, some were led to believe Hickey actually owned interest.co.nz.

To fund actual news reporting, particularly the sort Hickey wanted to produce, you cannot start without a large amount of cash to support yourself and time.   That is why you need a very wealthy and consistent funder to support you to develop your website and content.  Or raise the funds yourself.

I just hope Hickey is now less sanctimonious in his writing of others in New Zealand business, taking risks (or not), capitalism and the natural lust in economic models for money, power and profits.

He has proven in this mis-adventure to be just like everyone else.

Peter Cresswell summarises the fools proclaiming that various “levers” and “tools” should be deployed to lower the value of the dollar:

A “DEBATE” IS SUPPOSEDLY under way about monetary policy in New Zealand. A “debate” begun by economic ignoramuses calling for the Reserve Bank to redirect its efforts from “stabilising prices” to lowering our exchange rate.

What this amounts to is a call to use the printing press to lower our exchange rate—and hence to lower real wages.

Revealingly, however, neither of the politicians promoting this call to lower wages by means of the printing press give this as their method. Instead, they like to use metaphors,

Russel Norman, who has all the economic credentials of an organic termite farm, reckons “you can’t be a pacifist in an international currency war.”

David Cunliffe, a man never short of a desire for more “tools” in the politician’s toolbox–“a broader range of tools are needed” says Silent ‘T.’

Meanwhile, the bloke whose back he has his knife in his colleague David Parker talks about “pulling the levers” to get the dollar down. How? An explicit answer to that question still eludes him even after his flying trip around the globe to ask a gaggle of famous inflationists which specific levers to pull.

The most any will allow is that “the Reserve Bank should be actively considering selective intervention in currency markets.” Which, given the Reserve Bank’s size, would be roughly equivalent to pissing uphill in an attempt to reverse the flow of Niagara Falls.

It is left to alleged economists like Bernard Hickey and Rod Oram to make their case for them.  “Bernard Hickey wonders why New Zealand is not printing money and thinks we are being severely disadvantaged by not following the crowd,” says the fiscal fool’s own headline. And Oram’s column in the weekend’s Sunday Star Slime was essentially a begging letter to the Reserve Bank’s custodians to take the tarps off the printing presses and let rip.

After all, they both say, everyone else is doing it!

What a fruit loop of fucking fools!