Kippers

Just read this on BBC News.

Soaring crude prices could tip the world into a depression deeper than that of the 1930s, and collapsing stock markets cripple our ability to finance the expensive clean energy infrastructure we need

http://news.bbc.co.uk/2/hi/science/nature/6505127.stm

Where's the best place to buy land?
South Island?

Kip

Paladin

No stick to North Island - I don't want you pushing up land prices around Nelson!!!!

Dave

Kippers

Ha. Too many old hippies.... and I don't like tofu anyway


Kip

Paladin

You calling me an old hippie?

That's supposed to be a secret - would spoil my currency trader persona!!!

justinthyme

Good Article on the Kiwi$ and interest rates.

http://www.nbr.co.nz/home/column_art...me=NBR+Comment

The inconvenient truth about the Kiwi dollar

Conventional wisdom holds that the kiwi dollar is set for a fall. It is trading near all time highs, while the gap between what we spend and what we produce should be wide enough to warn off the most confident of foreign investors.

But we are not living in conventional times...........................................

Paladin

Interesting article Justin!

A little bit too narrow in focus in places though - remember NZ may be isolated geographically BUT it is no longer isolated in the globalised world of the money pushers!!!

1. Whilst I would agree that short term it appears high interest rates seem on the cards for NZ which will undoubtedly give support to the Kiwi dollar, longer term this is negative for the NZ$ as higher inflation and thus higher interest rates are just a reflection of the reduction in purchasing power of the NZ$ as it spirals towards being nothing but toilet paper like the rest of the fiat currencies.
2. Global macroeceonomics WILL affect the NZ$ and right now there are serious issues brewing out there, not least the potential unwinding of the Yen Carry Trade! We got a taste of what can happen with this a few weeks ago and its not pretty! If Yen starts getting repatriated to Japan, the NZ$ will be one of the hardest hit as it was one of the main beneficiaries of the yen carry.
3. Geopolitical tensions are running VERY HIGH, particularly with respect to Iran and the possibility of a US/UK/Israel attack on that country - any escalation will mean a flight to safety = buying of US$ and flogging of everything else(yes! even my beloved gold will get hammered initially )

Any one or combination of just those 3 things , let alone many others could send the NZ$ spiralling; so yes short-term the NZ$ should see some support for the mo, but long term I wouldn't bet the house on it!!!!

Dave

ballsrburning

Great post paladin nice insight into the Currency trading world, bit of an education.

Have you any predictions of how strong the NZ dollar is going to be in jan 2008 or around about that time? Probably to far in the future but hey thought I would try.

Paladin

Just check your crystal ball and you'll have as good an idea as me LOL!



Dave

Kippers

Presumably the banks here apply the Fractional Reserve to the loans they make to New Zealander's using borrowed Yen, multiplying the liquidity in the NZ economy several fold and driving the mortgage market and thus house prices even higher?

Wonder what would happen if all that money was suddenly withdrawn?


Kip

Paladin

Certainly does doesn't it!!!

I have been pondering the same thing with respect to the house we own here in the UK and have decided SELL!!!! I'm getting out while the gettings good! My contacts on the inside in the USA reckon the US housing market has got 6 months ish before implosion!!
Geez the whole worldwide property market could catch a serious cold from the fallout of the the sub-prime debacle in the US!!!! Just how deep that rabbit hole goes is scary as all those dodgy mortgages were bundled, securitized and flogged off as Mortgage Backed Securities all over the world to investment banks, pensions providers, municipal governements; you name it!! Its gonna get VERY VERY ugly!!!!! IMHO!!
And when the sh1t hits the fan and these lenders and investment banks etc have to shut down liquidity, ooh doesn't even warrant thinking about! Scary indeed! Goodbye housing boom!!! (amongst other things, but thats another story LOL!!!)

And that goes for NZ too!!

Dave

Kippers

This credit boom is a mighty pyramid scheme that will catch us all with our pants down.
A great deal of money/wealth is going to be destroyed to bring things back down to reality.
I've now sold all my shares except a few in a wind-farm development. I'm hoping energy investments will still have legs, especially once oil reaches $100 in the near future.

Just wish the government would stop building new roads and concentrate on getting the rail system back running properly while there are still resources to do it.
First priority should be to finish the main trunk electrification.
Are you listening Helen!

Kip

Paladin

OH and when the mighty huge credit pyramid scheme DOES come a tumbling down and the toilet paper fiat currencies eventually follow on like lemmings to the death - guess what, you had better own some gold and/or silver bullion or you're stuffed!!! HAHA!!!!

Dave

Paladin

Oh dear! GBP/NZD back under $2.73 again and heading south!

davec987

For gods sakes man - bring us good news for once would ya! :curse:

Paladin

No can do I'm afraid Dave!

As I predicted last week or so - we hit $2.72 today!! Actual low so far 2.7180!!!

Sorry mate!!



Might see a reaction at this level but if not, as I said previously, we are headed to the $2.66 area!!!



Dave