Top Scoops

Book Reviews | Gordon Campbell | Scoop News | Wellington Scoop | Community Scoop | Search

 

Molesworth & Featherston (Weekend) – 2nd Dec. 2005

Molesworth & Featherston - Weekend Update edition


Business and Political News
Friday, December 2 2005
molesworthandfeatherston.co.nz

In the latest edition:

Direct Link To This Week's Weekend Update Edition:
http://molesworthandfeatherston.info/pdf/MandF2Dec05L.pdf

Economy

What goes up

The kiwi dollar is touching 95 cents Australian and it’s over seventy US cents again, driven by a simple rule of economics - when more people want to buy something, its price goes up. Overseas holders of cash want to buy our currency and stash their money here where they can earn interest rates well above those offered by our competitors. They believe they’re on a one-way bet: We can’t afford to allow our currency to fall because the inflationary pressure would be intolerable with price rises already outside the Policy Targets Agreement. The Reserve Bank is picked to increase interest rates again next Thursday as it tries to bring price rises back inside the three percent limit, making New Zealand bonds look even better.

Contrary to widespread claims that the economy is struggling...it isn’t. We’re borrowing because we think our incomes will be good enough to pay the cash back. GDP is growing - albeit more slowly, but still growing. And detailed surveys of exporters don’t really support the widespread claims exporters are being hammered, either. Last week’s DHL Export Barometer found nearly two thirds expect their individual businesses to increase offshore sales over the next twelve months:

The DHL Barometer found two thirds of exporters expect greater profitability over the next 12 months, and their expectations have been strengthening this year.

There are risks ahead. The Ministry of Economic Development's briefing to its gaggle of incoming ministers says things will get tougher in the next couple of years - and not just for exporters.

The rapid growth of China, India and other Asian economies will force New Zealand to shift more toward the skilled end of the value chain. It will also keep pushing up the prices of fuel and raw materials, as well as transport, although as Chinese incomes rise so will its importance as a market. The Ministry says we need ‘large’ investments in transport, electricity generation, gas prospecting and electricity transmission.

Public financing and ‘wide-ranging’ regulation will be needed because competition in the infrastructure sectors is weak. It’s also making a limp call for more privatisation of the energy SOEs, calling for increased ‘private sector expertise and market disciplines’.

ALSO IN THE WEEKEND UPDATE…

UPGRADE

The Governor’s Edition of Molesworth & Featherston is smarter, it arrives midweek and covers the issues in thoughtful depth. This Christmas you can give a subscription to a mate for half price if you upgrade now with your credit card.

A FOREIGN AFFAIR

The Government hopes for an end to ongoing criticism over Winston Peters’ appointment as foreign minister outside the government. But fresh criticism in the EU Parliament keeps the issue alive. Page 3.

PARTY POLITICS

Many of our readers, contributors and the people we write about will be at the Press Gallery Christmas Party. So Molesworth & Featherston is springing sponsorship. For the white wine. You know we can’t take sides. Page 4.

MEDIA TATTLE

Michael Cullen recruits a new press sec from TVNZ, staff at Fairfax’s suburbans are revolting and the EU is asked to add Internet sharing of music to anti-terrorism laws. Page 5.

************

The Weekend Update is a complimentary, condensed edition of the paid-subscription only Governor’s Edition published last Tuesday.

For the inside oil on politics and business in Wellington - and to subscribe to the Governor's edition see…

http://www.molesworthandfeatherston.co.nz Pay for a Governor's Editions subscription HERE

Direct Link To This Week's Weekend Update Edition:
http://molesworthandfeatherston.info/pdf/MandF2Dec05L.pdf

© Scoop Media

 
 
 
Top Scoops Headlines

 

Binoy Kampmark: Predictable Monstrosities: Priti Patel Approves Assange’s Extradition
The only shock about the UK Home Secretary’s decision regarding Julian Assange was that it did not come sooner. In April, Chief Magistrate Senior District Judge Paul Goldspring expressed the view that he was “duty-bound” to send the case to Priti Patel to decide on whether to extradite the WikiLeaks founder to the United States to face 18 charges, 17 grafted from the US Espionage Act of 1917... More>>

Digitl: Are we happy living in Handy's Age of Unreason?
In 1989 Charles Handy wrote The Age of Unreason. It's a book that looked forward to a time where telecommuting would be an everyday reality. We live in that world today, although we use the term working from home. The book contains other predictions that were on the money... More>>


Reactionary Succession: Peter Dutton, Australia’s New Opposition Leader
The devastation wrought on Australia’s Coalition government on May 21 by the electorate had a stunning, cleansing effect. Previously inconceivable scenarios were played out in safe, Liberal-held seats that had, for decades, seen few, if any challenges, from an alternative political force. But the survival of one figure would have proved troubling, not only to the new Labor government, but to many Liberal colleagues lamenting the ruins. The pugilists and head knockers, however, would have felt some relief. Amidst the bloodletting, hope... More>>


Digitl: Infrastructure Commission wants digital strategy
Earlier this month Te Waihanga, New Zealand’s infrastructure commission, tabled its first Infrastructure Strategy: Rautaki Hanganga o Aotearoa. Te Waihanga describes its document as a road map for a thriving New Zealand... More>>


Binoy Kampmark: Leaking For Roe V Wade
The US Supreme Court Chief Justice was furious. For the first time in history, the raw judicial process of one of the most powerful, and opaque arms of government, had been exposed via media – at least in preliminary form. It resembled, in no negligible way, the publication by WikiLeaks of various drafts of the Trans-Pacific Partnership... More>>




The Conversation: Cheaper food comes with other costs – why cutting GST isn't the answer

As New Zealand considers the removal of the goods and services tax (GST) from food to reduce costs for low income households, advocates need to consider the impact cheap food has on the environment and whether there are better options to help struggling families... More>>