Rejoice! David Cunliffe used the C word

As we have seen, every crisis that Labour has focused attention on has magically fixed itself.  Sometimes even before Labour decided a crisis was there in the first place.

So it will come as great news to the boat building industry that Labour have declared their plight worth of their attention.

The crisis will be over before you know it

The New Zealand marine industry is sinking thanks to a falsely high dollar and a Government asleep at the wheel, Labour Leader David Cunliffe said today while visiting Oceania Marine in Whangarei.

“The marine industry is in full scale collapse; hundreds of workers have lost their jobs, a few firms are just hanging on. This is an industry in crisis.

You may now cry tears of joy.  David himself, used the C word.  Calm down everyone – everything will be fine now.

“Industry players say having the dollar at US87 cents makes the industry uncompetitive.

“Labour’s monetary policy will keep the dollar at more competitive levels using savings and implementing changes to the Reserve Bank Act to focus on exports. This would mean a lower average dollar and less volatility so that business can be more competitive.

“Labour’s Alternative Budget released yesterday confirms our commitment to a competitive boat building industry.

“A capital gains tax will help direct capital to where it’s most needed and can create the most jobs. KiwiSaver and a boosted New Zealand Super Fund will make domestic capital available to fund business investment.

“Labour’s monetary policy will help adjust the dollar down and keep jobs at home. Labour’s economic development policies will create jobs through strategic partnerships between government and businesses. Kiwis suffer when Kiwi jobs go overseas.

Vote for Labour, and the dollar will crash.   Never mind the crises that arise from that!  At least export businesses that rely on an artificially low dollar will have their problems solved.

Rhetoric aside, for Cunliffe to suggest he has any control over the NZ exchange rate is ridiculous.

Here is the current situation

Sterling rallied after the BoE announced measures to cap mortgage lending, while the AUD and other dollar bloc currencies rose in sympathy with stock markets, which rallied across Asia and Europe following Wall Street’s lead as the markets reacted to the drop in U.S. Treasury yields and implications on Fed policy following the downward Q1 GDP revision.

So, currencies rallied on the back of a drop in U.S. Treasury yields and implications on Fed policy following a downward Q1 GDP revision for the US.

Unless David Cunliffe intends to take control of the European, Asiand and US economies, the best he can do to cool the NZ exchange rate is to crash confidence in the New Zealand market.

…hmmmm… he wouldn’t… would he?

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