• Login:
Welcome, Register Here
follow PropertyTalk on facebook follow PropertyTalk on twitter Newsletter follow PropertyTalk on LinkedIn follow PropertyTalk on facebook
Page 569 of 601 FirstFirst ... 69 469 519 559 567 568 569 570 571 579 ... LastLast
Results 5,681 to 5,690 of 6004

Thread: Interest Rates

  1. #5681
    Join Date
    Sep 2004
    Location
    Hastings
    Posts
    15,419

    Default

    ANZ makes almost $2b from New Zealand banking
    31 Oct 2018
    Quote Originally Posted by Stuff
    ANZ made a record $1.99 billion profit in New Zealand in the past year. The 10-digit result is equal to almost 40 per cent of the profits made by the entire banking sector in New Zealand last year. It compares to profit of $390 million from Air New Zealand this year, a loss of $190m from Fletcher Building and $20m from Genesis Energy. It works out at $222,222 for each one of its 9000 New Zealand employees - or 121 million hours' work on the minimum wage of $16.50. It is $416 for every New Zealander this year.
    Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

  2. #5682
    Join Date
    Apr 2005
    Posts
    2,891

    Default John Key said interest rates may be going up all over the world, true?

    I don't get this.
    How can interest rates be heading up, legitimately.

    It has to be a huge government or banking scam.

    All those boomers are still saving for a rainy day.

    ideas?

  3. #5683
    Join Date
    May 2004
    Location
    Christchurch
    Posts
    589

    Default

    Things are becoming riskier so higher risk premium required?
    Boomers are not still saving, they are spending like mad!

  4. #5684

    Default

    I'll take it that this is a genuine question.

    The reasons interest rates are likely to rise worldwide are:


    1. After the Global Financial Crisis, a lot of central banks decided to lower interest rates to keep the world economy going.
    2. Unfortunately, very low interest rates lead to high inflation, which is a _very bad thing_. e.g. NZ house prices, world share markets etc.
    3. Now that the world economy is in better shape, and inflation has started to take off (e.g. US stock market and unemployment rate, NZ housing and stock market etc.) the central banks are starting to raise rates again to dampen down inflation and stabilise the economy.


    Since a lot of the smaller economies in the world decided to borrow US dollars at very low rates, they are now feeling the pain, as the cost of servicing those borrowings has now gone up, so the rates people pay internally have gone up.

    This has happened to some extent in NZ. Our inflation rate is still historically too low (as it is in Europe, but they've got an unusually complicated situation called the Euro), so the NZ Reserve Bank has kept interest rates low.

    However, our banks borrow a lot of the money they lend for mortgages etc. from overseas, so their interest costs have started to go up, and so have those for retail customers.

    Still, in the long term general interest rates in NZ should also trend up, mainly 'cos:


    1. People can now get nice safe government investments in the US that pay more than those in NZ.
    2. This means more people want to buy US dollars, which means the price of US dollars goes up and the NZ dollar price goes down.
    3. Which in turn (after a bit) means NZ goods are cheaper to buy from overseas, so more money comes into the country.
    4. Which in turn means higher inflation rates, followed by the Reserve Bank having to set higher interest rates.


    The US Federal Reserve have already indicated they're very likely to raise interest rates a couple more times at least, so this has started to be priced into market rates, but given the way the US economy is going at the moment there's a strong chance of more to come.

    Obviously, it's not as simple as I've outlined above. Economics consists of wheels within wheels within wheels, and all sorts of unusual feedback loops, and nobody has managing economies perfect yet.

    It's a close enough analogy though - barring some unexpected 'black swan' events. Such as - ooh, I don't know - how about Donald Trump changing the US Constitution by executive order, and a right wing supreme court allowing it?

    -----

    The thing a certain sad fat orange **** doesn't understand is that high inflation rates are _very very bad_ (Just ask Zimbabwe and Venezuela).

    It just doesn't feel that way to people. In Venezuela it's obvious, because you may have a house with a trillion money, but you can't buy anything with it, 'cos everybody is too worried about coping with rapidly changing prices, and the normal buying and selling of little things (milk, nappies ...) stops.

    In our situation, everybody just goes 'Meh'. Inflation rate of 5% a year? So what - I'l put my money where it inflates the most (houses, anyone), get out at the right time, and buy other stuff with my profits.

    Only then the prices of the 'other stuff' you can now afford start rising too because of supply and demand (tried to get a builder lately?), and round and round the money goes, inflating all the time.

    The thing is that even an inflation rate that is slightly too high has a gradual (and accumulating) effect on the economy, and sooner or later you end up in trouble.

    Unfortunately, the only way to keep inflation down that we know of at the moment is to raise interest rates to soak up money sloshing around in the economy and fueling it.

    So that is what the Fed is doing, and the effects have started trickling out of the US and into the rest of the world.

    -----

    ... retires now with the full intention of not rising to the bait when people start shouting opinions.

  5. #5685
    Join Date
    Sep 2004
    Location
    Hastings
    Posts
    15,419

    Default

    All predictions are fair game.
    Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

  6. #5686
    Join Date
    Apr 2005
    Posts
    2,891

    Default

    Quote Originally Posted by Perry View Post
    All predictions are fair game.

    Ha. true.


    But I think john Key has friends in places that know, and steer the future of money.

    So that's not really a prediction, more a revelation.

    look, my simple understanding of global money is this.

    They've been telling us for the past decade or so, that interest is low because more people have spare money( in the banking system) than people need to borrow.

    Right?

    Supply and demand.

    Quantity high, demand low, price low.

    Has that all been a croc, or has all that spare money vanished?

  7. #5687
    Join Date
    Sep 2008
    Posts
    7,658

    Default

    The Reserve Bank has kept the Official Cash Rate at a record low of 1.75 per cent.
    It's now been two years since the last move.
    It said it expects the rate to stay on hold until 2020

    https://www.nzherald.co.nz/business/...ectid=12156492
    have you defeated them?
    your demons

  8. #5688
    Join Date
    Jan 2012
    Posts
    1,142

    Default

    Quote Originally Posted by eri View Post
    It said it expects the rate to stay on hold to 2020.
    but that's not what John Key said...

    https://www.propertytalk.com/forum/s...941#post436941

  9. #5689
    Join Date
    Sep 2008
    Posts
    7,658

    Default

    while i respect JK's opinion

    clearly the public statements of the person who controls the official cash rate

    have a higher weighting

    perhaps

    adrian orr

    has new information?


    https://www.youtube.com/watch?v=XKVmpJaMffM
    Last edited by eri; 08-11-2018 at 04:31 PM.
    have you defeated them?
    your demons

  10. #5690
    Join Date
    Jan 2012
    Posts
    1,142

    Default

    For every qualified expert's opinion there's an equally qualified expert with a conflicting opinion.


 

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Similar Threads

  1. What are interest rates going to do?
    By hele27 in forum Property Investment (NZ)
    Replies: 25
    Last Post: 11-08-2015, 12:18 PM
  2. Interest Rates
    By hasheem kamal in forum Property Investment (NZ)
    Replies: 11
    Last Post: 25-01-2014, 12:12 PM
  3. Replies: 2
    Last Post: 04-05-2009, 08:46 PM
  4. Are interest rates on the way up?
    By Rosco in forum Finance, legal and tax (NZ)
    Replies: 17
    Last Post: 13-02-2009, 05:21 PM
  5. 1% Interest Rates
    By Don and Liz in forum Property Investment (NZ)
    Replies: 5
    Last Post: 26-03-2008, 11:14 AM
  6. Interest rates: up or down
    By casacamo in forum Finance, legal and tax (NZ)
    Replies: 11
    Last Post: 21-05-2007, 12:17 AM
  7. interest rates
    By Belinda in forum Finance, legal and tax (NZ)
    Replies: 7
    Last Post: 31-01-2007, 09:43 PM
  8. Interest rates
    By [email protected] in forum General (NZ)
    Replies: 7
    Last Post: 27-10-2006, 05:15 PM
  9. Interest Rates - up or down
    By muppet in forum Property Investment (NZ)
    Replies: 2
    Last Post: 20-07-2005, 08:57 AM
  10. Interest Rates going up??
    By Marc in forum Finance, legal and tax (NZ)
    Replies: 5
    Last Post: 13-11-2003, 01:12 PM

Tags for this Thread

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •