David Thompson Posted:
So very, very true. It beggars belief that we consider ourselves to be a developed nation when so much of our economy is based on selling milk powder or logs. BTW, I own a Plinius amplifier (my second) that drives a set of Theophany speakers.
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David Thompson Posted:
A robust but sobering report. It concerns me that confidence is rising, yet sales and exports are down and "manufacturers and exporters are still lagging behind other sectors". Surely we should wait until we're earning more money before we start spending more?
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siemens Posted:
Yes true! The only thing that will never die in this world is the nature and its science behind it. Great post.
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Kieran Ormandy Posted:
Thanks for the question Steven, Germany has seen increases in manufacturing employment since 2009, and Switzerland has had stable manufacturing employment between 2006 – 2011, even in the face of ongoing Euro-zone issues. Korea has seen increases in manufacturing employment since 2008 and Israel experienced large increases since 1998, while being stable over the last 4 years. Singapore has had increases in manufacturing employment over the last two years. These countries all value their manufacturing sectors and work to protect them, this is reflected in the above numbers and their performance through the GFC. Note data around the above examples was sourced from OECD labour market stats.
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John Walley Posted:
Point one: you should have no doubt what our Association says publically represent the views of our members. Point two: we don’t knee jerk responses, if you trace back our comments around NZPower you will see them link all the way back to our research in 2004 and 2005. All that material is fully linked from our comments above. Point three: you will note our comments on major users, sadly the same advantage does not accrue to smaller industrial users. The perverse incentives of the LRMC approach in all this are well known. Point four: the NZMEA is not like any other Association in New Zealand we admit only manufacturers and exporters into membership, and our public expressions are the views of that restricted membership.
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Bernard Hickey on Treasury's Macroeconomic Forum

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Bernard Hickey reviews the Treasury's 'Macroeconomic Imbalances – Causes and Remedies Policy Forum' for  He looks at the presentations given and gives his own take on the conference as a whole:

"There was a lot of talk about unintended consequences and finger pointing at politicians and voters. There seemed to be an awful lot of shoulder shrugging and a disturbing acceptance of our lot in life. New Zealand seemed stuck in a rut as a commodity exporter with a high currency, high debt and a reliance on foreign creditors.

Everyone seemed to agree we needed to lift our national savings rate and reduce our vulnerability to hot international money markets.

But there were few big ideas to solve the problems. A few tweaks and fiddles were suggested, but on the whole most believed the status quo was the least worst option. The unsustainability of a current account deficit running at more than 5% of GDP, a net foreign liability of nearly 90% of GDP and a foreign debt rollover problem of 50% of GDP stared everyone in the face from almost every slide, but there seemed little that could be done.

There was no discussion about high youth unemployment rates, migration rates and falling Gross National Income per capita, which are the ultimate results of our macroeconomic failures. The looming surge of spending on health and pensions for baby boomers was only briefly addressed.

My frustration culminated in the final session where two very senior figures in New Zealand's business and economic community questioned this status quo. They pointed out that our reliance on a floating exchange rate and an inflation-targeting central bank had led to high interest rates, low investment rates and higher foreign debts. They were essentially saying the orthodoxy adopted since the mid 1980s was not working.

Their points weren't even addressed by policy makers with their hands on the levers of monetary and fiscal policy.

The whole conference reeked of complacency, a lack of urgency and a sense of impotence."

tags: bernard hickey, treasury, exchange rate, inflation targeting


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