Alan Bollard’s not a Grinch, he’s just doing his job. Listener: 5 April, 2008. Keywords: Macroeconomics & Money; Last October, Alan Bollard, Governor of the Reserve Bank, broke an implicit constitutional convention when he said that if this year’s tax cuts were too generous, he would have to tighten monetary policy. Governors have long muttered…
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The days of having a dominant world currency are coming to an end. Listener: 9 February, 2008. Keywords: Globalisation & Trade; Macroeconomics & Money; When a barrel of oil rose to $US100, it also cost E69, $NZ130 and at least 200 million Zimbabwean dollars (at the unofficial exchange rate). There was some…
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Ignore the happy brigade. The forces of recession are already in motion. Listener: 1 December, 2007. Keywords: Macroeconomics & Money; Larry Summers, the best economist ever to have been Secretary of the US Treasury, points out that major international financial crises occur about every three or four years. The last – the…
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House prices can be fickle but debt is loyal to the end. Listener: 22 September, 2007. Keywords: Business & Finance; Macroeconomics & Money; What is the value of your house? You might quote the “rateable value” given by Quotable Value for local authority tax (rates) purposes. Or you could go to a…
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The 11th Annual Public Sector Finance Forum. 10 September, 2007 Keywords: Macroeconomics & Money; Regulation & Taxation; Statistics; It has been my lot to be asked to give two papers to this Public Sector Finance Forum. Today’s paper might be called the ‘macroeconomics’ paper, in which I look at the size of…
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The 11th Annual Public Sector Finance Forum. 10 September, 2007 Keywords: Macroeconomics & Money; Regulation & Taxation; Statistics; It has been my lot to be asked to give two papers to this Public Sector Finance Forum. Today’s paper might be called the ‘macroeconomics’ paper, in which I look at the size of the…
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Will There Be A Worldwide Financial Crash? Listener: 25 August, 2007 Keywords: Macroeconomics & Money; We cannot tell whether the current turbulence in international financial markets will continue, end or get worse. What is certain, though, is that there are serious financial imbalances in the world economy that have to be corrected in the long…
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This note was commissioned by the Sunday Star Times (5 August, 2007) Keywords: Distributional Economics; Macroeconomics & Money; Social Policy; In the year to June 2004, 3.7% of all households suffered ‘mortgage stress’ defined as having at least 40% of their disposable income being used to service their mortgage. This definition of mortgage stress…
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Listener: 16 June, 2007 Keywords: Macroeconomics & Money; When the Reserve Bank Act was passed in 1989, there were those who warned that it would not work. To be sure, the principle of making the bank responsible for operating monetary policy while the government of the day set the policy objective is a…
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Subsidies could help us save more – and boost economic growth. Listener: 19 May, 2007. Keywords: Macroeconomics & Money; New Zealanders are not saving enough. The consequence is that a high proportion of our most productive capital is becoming overseas-owned, as we use foreign savings to finance our new investment and sell existing assets to…
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Keywords: Macroeconomics & Money; I was asked to provide the New Zealand equivalent in the graph showing US housing prices relative to consumer prices in Real Estate Roller Coaster . The longest housing price series I could find starts at the end of 1979 and finishes in late 2006. I wont go into detail but…
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Innovation and Independence: the Reserve Bank of New Zealand 1973-2002. John Singleton with Arthur Grimes, Gary Hawke and Frank Holmes. (Auckland University Press in association with the Ministry of Culture and Heritage). A longer version of the review published in New Zealand Books Autumn 2007. p.11. Keywords: Macroeconomics & Money; This history…
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Milton Friedman (1912-2006) contributed to economic analysis but was also an important economic philosopher. Listener: 24 February, 2007. Keywords: Macroeconomics & Money; When Friedman visited New Zealand in 1981 he was interviewed for the Listener. Told that money supply (in this case Reserve Bank-issued currency plus trading bank lending, what economists call “M1”)…
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Tax cuts without any pain? You’d have to be daft to have swallowed that. Listener: 27 January, 2007. Keywords: Macroeconomics & Money; Nicky Hager’s The Hollow Men provides a fascinating insight into the realities of politics. A rich right-wing cabal got their man, Don Brash, into the leadership of the National Party. But the economic…
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Tiny Loans Are Making A Huge Difference for Some of the World’s Poorest Peoples Listener: 6 January, 2007. Keywords: Growth & Innovation; Macroeconomics & Money; The Nobel Memorial Prize in economics was founded by the Bank of Sweden in 1979. Economists have only been tangentially involved in Alfred Nobel’s much older awards for achievements which…
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Listener: 9 September, 2006. Keywords: Macroeconomics & Money; The external deficit (of the current account of New Zealand’s balance of payments) is currently around 10 percent of GDP. Once, a deficit of three percent of GDP was thought about right; we got edgy when it rose above five percent. Should we, then, be panicking now? …
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Listener: 29 July, 2006. Keywords: Macroeconomics & Money; The change of coinage over the next few weeks will pay for itself. Not only will the new coins be more convenient to use, but also they are cheaper to make. The savings will pay for the administrative costs of the change. Today’s currencies cost…
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Should we have tax cuts without cutting government spending?
Listener: 20 May 2006.
Keywords: Macroeconomics & Money;
This columnist made himself highly unpopular in the 1980s by arguing for fiscal conservatism; ie, restraining the size of the government deficit between its revenue (mainly taxation) and government spending. Even the Treasury abandoned fiscal conservatism, arguing in 1984 that “with a floating exchange rate there is less risk that poor monetary and fiscal policies will impoverish those industries exposed to world trade while generating spiralling external debt”.
Why have the do-nothing policies of the 1980s gone out of fashion?
Listener: 11 March, 2006.
Keywords: Macroeconomics & Money;
Just under 20 years ago, the Kiwi dollar was overvalued. A spendthrift government was running a large internal deficit that had to be financed by borrowing. As the offshore loans flooded in, attracted by high interest rates, the exchange rate (the Kiwi dollar relative to overseas currencies) was pushed up.
This note was prepared for a client in mid December 2005
Keywords: Macroeconomics & Money;