Media Party fail to convince voters that the economy is tanking

This is amusing.  Consumer confidence is strong on the back of a drop in benefit numbers and low inflation, and somehow this is a bad news story because people that aren’t on farms should be concerned about milk prices instead.

New Zealand consumers are ignoring bad economic news with sentiment broadly stable at a respectable level, according to the ANZ-Roy Morgan Consumer Confidence Index.

ANZ senior economist Philip Borkin said if they wanted, there were several things consumers could get wound up about.

The dairy sector faced a daunting period of ongoing poor returns and an intense focus on costs.

The adjustment had much further to go.

Those wanting to get on to the housing ladder would be looking a recent price growth with despair, he said.

It was the same for savers, given ongoing falls in interest rates.

Media always look at the economy from the point of view of people who are poor.  House prices going up also means lots of people are feeling great about their increase in equity.

People who save and are paid interest are paid less, but the actual earnings are what they are paid less inflation.  No point getting 6% on your savings with a 5.5% inflation rate.   It would be better, by way of example, to get 2.5% on your savings with a 0.4% inflation rate.  

And before anyone says “but inflation does not include house prices”, let me refer you to people who own houses and have investments (that’s not Andrew Little), they are happy as.

Apparently we should all be down in the dumps because first home buyers can’t do it in Auckland, and dairy farmers are going through a tough period.

Clearly, to media, the country is made up out of dairy farmers and young people wanting a home in Auckland.

The index rose two points in April to 120, slightly above the historical average and continuing a theme evident since the start of the year.

A net 8% felt better off compared to a year ago, broadly where it had held for four months.

A net 28% were positive regarding the next 12 months.

Net optimism regarding the short-term economic outlook, at net 9%, reached a five-month high.

A net 38% believed it was a good time to buy a major household item, up 4% from March.

Exactly.  I don’t know why the media are just so hung up about Dairy and house prices.  Sure, they’re part of the mix, but everything else is going gang busters.

 

– Dene Mackenzie, ODT

 


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  • Mark Reynolds

    Interest rates are their lowest in 40 years, unemployment rate has fallen to a 7 year low, beneficiary rates are falling, inflation is almost non-existent. Yep, bad, bad news :-(

    • rua kenana

      I always thought that average real per capita income was the best/most widely accepted criterion for the economic wellbeing of a country rather than just a few selected indicators.
      But I guess I must have been wrong. Too bad about that!

  • XCIA

    The fools who run the media just don’t seem to realise the worm has turned. Their beliefs are still back in the Al Capone days where Al had them on the payroll and when most people read the papers and most people believed what they read in them. Now, they dance to the Union tune, but most people don’t read the newspaper and most people don’t believe what they read in them anyway.

    • Dave

      The bar to get into a media / Journalism course at most Uni’s is set pretty low, its attracting the little lovelies who think writing is romantic, and who can’t get into accounting / law or similar.

  • Aucky

    The PM and his team have just upped the ante big time in China – chilled beef & lamb exports, more tourism deals and other enhancements across the board. I’m really concerned.

    • Second time around

      That can mean only higher fresh meat prices at home and more expensive holidays for NZ families who can’t afford to take their holidays in Hawaii like John Key. Bad times are ahead. The Zespri news from China (now the largest market for kiwifruit) is more bad news for families who want some affordable fruit to give their children.

      • Aucky

        You should seriously consider moving to North Korea or Venezuela.

        • Second time around

          No need, 2017 or 2020 or 2023 will be early enough! It took only one term of the Labour government in 1984 to set relations with the US back for 30 years, and I am sure Andy can achieve the same result with China.

          • Dave

            Just a reminder, Auntie Helen signed the China FTA and did almost all of it in secrecy. Why wasn’t it so bad than, but as Key manages to update it and tweak it, its all of a sudden bad?

          • XCIA

            Auntie H would have done everything under the cone of silence is she could have got away with it.

          • biscuit barrel

            It was debated in parliament, NZ First was against it

          • XCIA

            I thought Peters purchased the original Cone of Silence from CBS.

          • hsvmaloo

            Just prior to ratification.

      • XCIA

        I guess the trade off would be our dollar around +/- US80 cents under Key or -US40 cents under Mr Angry. I doubt if many would be going overseas for a holiday, more like they would be leaving the sinking ship.

      • Old Chook

        Zespri operates only on the international market and is excluded by regulation from selling in NZ and Australia. NZ and Australia have multi sellers through the post harvest operators. Unlike Fonterra, what Zespri gets for the fruit has no bearing what so ever on what the domestic market pays. The grower makes so little money (if any some years) from the domestic market, when doing budgets going forward, I never even considered our domestic market income.

        • Second time around

          The overseas demand, including from Australia, does influence how much good grade fruit is available in our market. However my comments were tongue in cheek- every success under the government’s watch will be interpreted by Labour as a failure.

    • Me too. There goes the price of a steak through the roof.

  • Caprice

    I am always amused by coverage of our dollar vs overseas currency..
    Dollar goes up, ‘Woe is us, exporters will find it extremely hard’.
    Dollar goes down ‘ Woe is us, petrol and electronics will cost the average Kiwi more’.

    • Dave

      Dollar stays the same; Government is mismanaging the economy, there is no stimulation.

    • RoboRob

      Agreed. I also love random reporting of the stock market. x and y stock up/down and then the ‘financial genious’ tries to tell us why, as if they have any idea. What the experts never tell anyone is that the reporting is all a joke, the price of the share used is the last trade of the day.

      Spark (for example) could have traded millions of shares all day at $10 a share but if joe blogs sells their 1000 shares for $8 and it’s the last trade. The Media report Spark trading down for $9 to $8 on (made up reasoning) ‘weaker chinese outlook’.

  • cows4me

    It’s probably time for the media party to roll out Andy to declare a crisis because there’s no crisis.

  • Keanne Lawrence

    This from the ODT where crowds have gathered to meet people who have turned up to boost the population, welfare numbers at the same time. 13 Syrian Refugee families. That should just about be enough to cover the quota.

  • Simon P

    The good thing about chilled beef is that it will slow dairy farm conversions and make the farming sector stronger.

  • Rick H

    If they try and tell you that “dairy farming” has gone the way of Blackberry Growers of the 80’s, think again.
    More land is still this very day being converted into dairy farms in South Canterbury.
    It hasn’t stopped.

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