GDP

How is Robbo going to spin this good news?

Labour likes to talk down New Zealand and its economy. They are trying, and failing, to convince voters that they have better solutions.

I doubt even Robbo could spin this news negatively.

This Thursday GDP figures are expected to show the New Zealand economy grew by at least 3.5 per cent in the year to June 30.

ASB’s economists are picking it to be as high as 3.7 per cent.

“We expect GDP lifted a whopping 1.2 per cent over the June quarter, led by construction, manufacturing and retail activity,” ASB senior economist Jane Turner writes in her preview.

Read more »

Put climate change on the back burner – El Nino is coming with a vengance

via teara.govt.bz

via teara.govt.bz

It’s official. ?NIWA feels there is a 99% confidence level that we’ll suffer a severe El Nino this summer. ?That means the eastern parts of New Zealand will be dry, yellow and dusty. ?Bay of Islands, Bay of Plenty, Poverty Bay, Hawkes Bay, Nelson Bays, Gisborne and most of Canterbury will experience severe drought conditions. ? Read more »

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Rock stars we are

The New Zealand economy is still a rock star, according to Paul Bloxham, the man who originally coined the phrase.

In a New Zealand economics comment, Mr Bloxham, the chief economist for HSBC Bank Australia, said despite lower dairy prices and lower growth in its major trading partners, New Zealand’s economy continued to be supported by a construction boom and the story had further to run.

As a result, interest rates were at high levels when compared with the rest of the developed world and the currency was high.

The New Zealand dollar was nearing parity against the Australian dollar for the first time in 42 years. Some early signs of domestic price pressures picking up suggested the New Zealand Reserve Bank was unlikely to cut rates this year, in contrast to current market pricing, he said.

Mr Bloxham said there were a range of indicators showing the New Zealand economy was still booming.

The broadest economic indicator of gross domestic product, or GDP, showed growth was broad based across industries with 15 of 16 sectors showing expansion over 2014. Overall GDP was running at a well above annual trend of 3.5%. The more timely indicators confirmed the strength had continued into 2015. Read more »

More good news – as if we needed it

Statistics New Zealand reports

Strong growth in service industries saw gross domestic product (GDP) rise 0.7 percent in the June 2014 quarter, Statistics New Zealand said today.

?Services make up about two-thirds of the economy and all 11 services industries increased this quarter,? national accounts manager Gary Dunnet said. ?The biggest increases were in industries that include advertising, employment services, and software development.”

Overall, services increased 1.4 percent, the highest growth since the December 2006 quarter. Business services (up 4.2 percent) was the main driver, although accommodation and food services increased 3.0 percent. These increases were partly offset by a 3.1 percent decrease in primary industries, where agriculture, forestry, and mining all fell.

GDP growth for the year ended June 2014 was 3.5 percent. This is the highest annual growth since the September 2007 quarter. Read more »

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Business booming, Labour loss looming

I don’t have the capacity to feel pity for David Cunliffe, but he has to be wondering what he has to do to catch a break. ?He finally gets his hands on the Prize as leader of the Losers Party, and just about all the indicators continue to go south on him. ? Michael Fox explains

Financial experts are united – next year could be a golden one for the New Zealand economy with all signs pointing to a prosperous 2014.

Commodity prices are booming, businesses are at their most confident in 20 years, the economy is among the world’s fastest growing, jobs and wages are predicted to rise and that confidence is filtering through to consumers who are starting to open their wallets.

New Zealand’s GDP growth was at its highest in four years in the last quarter at 3.5 per cent on the previous year – higher than Australia (2.3 per cent), the US (1.8), Britain (1.5) and Japan at 2.4 per cent.

Compared with Australia, once our largest trading partner but recently overtaken by China and whose economic growth outside the mining sector has relatively flatlined, our positive outlook is more stark.

Perhaps Cunliffe and Norman should move to Australia where their brand of “the sky is falling, we can spend our way out of it” policies will be more receptive. ? Read more »

Map of the Day

Map_of_countries_by_GDP_(nominal)_in_US$

Map of countries by GDP (nominal) in USD

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Where's the money coming from Michael?

Last week on Thursday Michael Wood stood up at an NZEI organised debate and promised, even signed up to comitting Labour to spend 1% of GDP on Early Childhood Education. Here is the audio of the question and then Michael Wood’s answer.

Michael Wood promising to spend 1% of GDP on ECE

Link to audio file: http://www.whaleoil.net.nz/images/2011/02/michaelwood-gdp[dot]mp3

So Labour’s man in Botany committed to spending 1 per cent of GDP on ECE. It must be Labour policy because on 8 February Trevor Mallard was imploring people to sign a petition, presumably the same one Michael Wood is committing his signature to, to spend 1% of GDP on ECE.

This would equate to an extra half a billion a year!!!

Education Minister Anne Tolley said the Government’s investment in ECE will be $100 million above the original Budget 2010 allocation, bringing the total spend to $1.4 billion.

“We are now at the stage where the taxpayer is subsidising ECE centres at an average of $7600 per child per year,” Mrs Tolley said.

“This compares to an average of $5528 for a primary school student, and $6733 for a student at secondary school.”

Mrs Tolley said the average taxpayer-subsidised payment to ECE centres is almost $270,000 a year, while kindergartens receive $325,000 on top of what independent ECE centres ask parents to pay.

“It makes no sense that ECE funding has trebled over the last five years, while the number of children starting school with some form of ECE has increased by only around 1 per cent.”

I obtained the following figures for ECE?participation?over the past 10 years that shows the?minuscule?growth in ECE?participation. The total rise in?participation?is just 0.9%

ECE Participation

Source: Ministry of Education data

Then when you look at the graph for spending in ECE over that time you can see where the problem lies.

ECE funding

Source: Ministry of Education data

Spending on ECE has more than tripled over 10 years and yet child participation has only increased a?minuscule?0.9% across the sector. The NZEI and pinkos are screaming for even more money to be tipped into the sector, but there appears to be?little?to gain from doing so. When Labour and the NZEI say there are cuts to the sector, point at these graphs and ask where?

Funding to the?sector?has increased and for no demonstrable gain in participation.

In fact in order to achieve that which they profess to seek, 100% participation in ECE, based on the figures above and more than 10 years of history to prove it, we would need to commit an additional $7 billion year on year. That is if you believe the socialist fantasy that more money equals more?participation.

Labour, the NZEI and Michael Wood need to be held account for their rash promises. Promises that would?have?to be met from an empty public purse. Their fantasies must be called out. Just to meet their demands of 1% of GDP will cost an additional half a billion dollars we don’t have.

Labour is fond of making rash promises, but they can do that because they are secure in the knowledge that they will never have to deliver them.

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