Jarrod is Kiwibank's Chief Economist.
He has been completely consistent in his ongoing commentary around interest rate cuts and the Reserve Bank's need to do more.
To be fair, our own Greg Smith at Devon Funds Management has told us, and argued, a similar story.
The Kiwibank economic report that got a decent amount of coverage over the weekend is Jarrod's - proof positives that he is right and Adrian Orr and Christian Hawkesby have been, and are, wrong.
As long as they continue to be myopic and look at nothing but inflation they can argue two things.
1) It's in the band, even though it's dangerously close to not being, and will most likely breach it this year,
2) This ongoing, but increasing false, idea that they have cut enough and the efforts of that will flow through eventually.
We are virtually in August and the 25 points cut in the latter part of this year that's supposed to be lift off is nothing of the sort and the Kiwibank report confirms it.
It tells us what we know already - the further south you go the better it is.
But here is the real news; even in the best, most lucrative, optimistic part of the country i.e Otago and Southland they only get 5/10.
A half mark is as good as it gets. The rest of the country is miserable.
Are there signs? Yes, but how long do you want to squeeze the economic lemon looking for juice?
Dairy, meat and kiwifruit - all the stuff we have talked about, and celebrated, is not only doing the heavy lifting; it's doing almost all the lifting.
Tourism is there in Otago. But its still only 86% of what it was six years ago.
Confidence is hard to find, foreigners still can't buy a house when they invest millions, and for every dollar you get from lower interest rates you pay $2 more for your power and insurance and rates, which have become the new version of highway robbery.
The economy needs help. It needs a major enthusiast, it needs a circuit breaker and the Reserve Bank and their view and actions are potentially it.
Jarrod sees it, Greg sees it, John Key sees it and wants a full 100 points drop.
But until anyone of them is Governor, we rely on Christian and his committee and that is where the problem lies.
Mike Hosking is a New Zealand television and radio broadcaster. He currently hosts The Mike Hosking Breakfast show on NewstalkZB on weekday mornings - where this article was sourced.
The Kiwibank economic report that got a decent amount of coverage over the weekend is Jarrod's - proof positives that he is right and Adrian Orr and Christian Hawkesby have been, and are, wrong.
As long as they continue to be myopic and look at nothing but inflation they can argue two things.
1) It's in the band, even though it's dangerously close to not being, and will most likely breach it this year,
2) This ongoing, but increasing false, idea that they have cut enough and the efforts of that will flow through eventually.
We are virtually in August and the 25 points cut in the latter part of this year that's supposed to be lift off is nothing of the sort and the Kiwibank report confirms it.
It tells us what we know already - the further south you go the better it is.
But here is the real news; even in the best, most lucrative, optimistic part of the country i.e Otago and Southland they only get 5/10.
A half mark is as good as it gets. The rest of the country is miserable.
Are there signs? Yes, but how long do you want to squeeze the economic lemon looking for juice?
Dairy, meat and kiwifruit - all the stuff we have talked about, and celebrated, is not only doing the heavy lifting; it's doing almost all the lifting.
Tourism is there in Otago. But its still only 86% of what it was six years ago.
Confidence is hard to find, foreigners still can't buy a house when they invest millions, and for every dollar you get from lower interest rates you pay $2 more for your power and insurance and rates, which have become the new version of highway robbery.
The economy needs help. It needs a major enthusiast, it needs a circuit breaker and the Reserve Bank and their view and actions are potentially it.
Jarrod sees it, Greg sees it, John Key sees it and wants a full 100 points drop.
But until anyone of them is Governor, we rely on Christian and his committee and that is where the problem lies.
Mike Hosking is a New Zealand television and radio broadcaster. He currently hosts The Mike Hosking Breakfast show on NewstalkZB on weekday mornings - where this article was sourced.
4 comments:
Mike, Are you out of your mind? Can you please, please stop doing economic commentary, when its relentless uninformed garbage. Much of the reason NZ is doing badly is because people like you, who do have quite a lot of influence, are desperately trying to influence things in the wrong direction, since you have no clue how the Reserve Bank, nor wider economy, works. Please stick to being a DJ and play another record, or keep your commentary to Liam Lawson and Formula 1, Robert
PS: Hi Mike (again), Your mate Jarrod Kerr was a great supporter of the money printing / Quantitative Easing programme that helped ruin NZ's economy. (I never was). Maybe you should apply for RBNZ Governor Mike, because you know everything. Given you're mates with John Key you'd have a way better chance of getting it than me, given NZ has become a "chumocracy":
Here's one news quote of many from your mate Jarrod in 2020-21:
"The RBNZ’s LSAP programme has been successful to date," Kerr said. "But the Government has only just begun to expand its balance sheet and bond issuance program. The RBNZ has plenty more bonds to buy. The LSAP program is likely to be lifted from $60 billion towards $100 billion. And we think the program will ultimately end up near $120 billion in coming years."
Mike, fair point, but a coffee cup would have been a better governor than that tosser Orr as a coffee cup can't do much damage. Re Kerr, I like him, he's very charismatic and I was lucky enough to spend an hour with him a while back. His insights were interesting and looking back his vision has turned out quite accurate. Can't be worse than Orr.
Please can we set our sights much higher for governor of our reserve bank? Great to see Grant Spencer joining the board. Hope that’s the start of a quantum shift back to the far higher levels of experience and expertise we formerly enjoyed amongst the board and staff of the RBNZ.
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