Oh look at that – OCR to go higher

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How can insurance costs ever come down?

The take away from this weeks OCR is that they were looking to INCREASE and that they are now predicting a top OCR of 5.7!

I keep arguing  that there are now structural changes in the global economy altho will only continue to feed inflation.

One of these structural change is the increasing geopolitical instability and free trade supply chains changing from just-in-time to just-in-case models as Western companies disengage from China.

The other major structural change is the shut down of the climate from catastrophic climate change which will only force insurance premiums up and up and up.

Add on top of this the local Government rates going up to cover the infrastructure costs of mass immigration and we have a perfect storm of info;ation that we can’t control.

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The Reserve Bank will be forced to lift the OCR before the end of this year causing even more pain amongst home owners.

 

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32 COMMENTS

  1. Martyn – So borrowing tens of billions during Covid to fund non Auckland Harbour Bike Lanes, and paying for consultants on the ghost Auckland Light Rail has a cost?

    • You are correct Nathan but most supporters of the left cannot even read a balance sheet,they are literally financially illiterate.

      • Neither can you Bob. In your little National world you only read the liability side and exclude the assets. I am not sure what you do with the Equity section. Are you more focused on inequity perhaps?

        You probably have more of clue than you let on but you just talk rubbish to support the coalition.

      • Very sad that most supporters of the right are completely financially illiterate and having a supporter like Bob TF is such an embarrassment that when even he makes the completely financially illiterate seem smart.

    • They probably do, but supporting small businesses and keeping people in work with that money, which is where a lot of it went, has a benefit.

      • guerilla surgeon – and funding the big banks and Air NZ — they got far more than small businesses in the Covid funding package.

    • It is good that these wasteful spending items are not forgotten . Wasteful spending and co governancy like 3 waters is what lost Labour the election.Blaming it on covid control is a smoke screen

    • Except it wasn’t billions for Light rail was it Nathan. It was around 200mil which also includes land purchases. Please also show us where there are billions borrowed for the Harbour Bridge? I recall proposals but that’s not the same thing.

      • Wheel – No, Labour borrowed $50 Billion during the Covid lockdowns – then spent it on pet projects – like Bike lane and Light Rail…Happy?

    • $50billion borrowed and given to landlords, businesses and banks during covid. Where is that money now? At the end of covid times if you didn’t have an extra $10,000 in your bank then the borrowed money wasn’t given to you. Who was it given to and when are those people going to give it back to the government to balance the books. The $50billion needs to be traced and recovered.

    • Yep, the harbour bike bridge was a bad idea. I thought that even the most hardy cyclist would be keen on making that crossing on a cold winters day,

  2. But National, ACT and Winston First adherents will all blame everything on Labour and its wasteful spending and actions that negatively impacted the economy (e.g. lockdowns) or the way the economy operates (e.g. transfers). The worse thing is that many will actually believe their BS because they lack the ability to critically analyse policy and the impacts thereof.

  3. Luxon was going to wave his wand and the ecoonomy was going to be all sorted by now .He announced a $24 million hand out yesterday without saying where the money was coming from and who was going to be accountable for the out come .Now pork is going to rip the west coast apart and create a massive housing shortage along with massive price increases for the few houses there are and rents will double .Local rates will increase by a massive amount to pay for the extra 3 waters needs .

  4. Yes the irresponsible financial behaviour of the Labour Government will take some time to correct.

    • Think about that stupid statement next time a Labour trained tradie comes to fix your plumbing or electrical and the now well paid nurse is giving you treatment at hospital because she is now earning 100% more than she was in 2016

    • Bob, it is rather dangerous to use your entire vocabulary in a single sentence.

  5. Let me be clear. ANZ. BNZ. ASB. Westpac. RBNZ. They, are the enemy. Look at older paper currency and see don brash’s signiature. Don brash then became ACT.
    Wikipedia
    Leadership of the ACT Party
    On 28 April 2011 the incumbent leader of the ACT Party, Rodney Hide, announced that he was stepping down as leader in favour of Brash who had joined the party that morning. His membership was ratified by the party board on Saturday 30 April and the ACT party parliamentary caucus confirmed him as leader the same day.[43]
    Also:
    Career after national politics
    On 18 May 2007, Brash joined the ANZ National Bank board as Rob McLeod retired from the board to return to his accounting practice. He also chairs Huljich Wealth Management, an independent, specialist funds-management company based in Auckland, New Zealand.[38] In late 2008 he was lecturing in economics at the Auckland University of Technology In April 2009 Brash was appointed as a director of the electricity grid operator Transpower.[39]
    So, we have little billy who’s without a doubt in don’s pocket along with jonky.
    88 years of the natzo’s tying us awesome people up in debt while standing on the neck of our fabulous AO/NZ.

  6. New Zealand cannot decrease rates until the US Fed does so, since it would tank the NZ dollar making all our imports more expensive (which of course equals higher inflation). We don’t have a truly independent Reserve Bank, it is beholden to the US Fed. The US can no longer export their inflation after they sanctioned Russian financial interests, which sent shockwaves through the entire global financial sector (since it showed the US cannot be trusted to keep any financial promises if your government does something they don’t like). Thus interest rates will remain high for the foreseeable future.

  7. A few here are quick to solely blame Labour, for the fiscal carnage, yet seem to have forgotten it was the Reserve Bank that allowed the easy money to flood the market. Failing to turn the tap off in time.

    And it is the Reserve Bank that is now applying the squeeze.

  8. Well, I hope none of you still on fixed rate mortgages from before the hike for the next couple of years have been doing anything but paying the minimum and putting money away in a term deposit or PIE to pay them off before things roll over. These usurers deserve to have their tricks turned back on them. Rabo have good 12 month rates still.

  9. Think about that stupid statement next time a Labour trained tradie comes to fix your plumbing or electrical and the now well paid nurse is giving you treatment at hospital because she is now earning 100% more than she was in 2016

Comments are closed.