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FROM: "f.macskasy"
SUBJECT: Letters to the Editor
DATE: Tue, 28 Jan 2014 22:32:06 +1300
TO: "NZ Herald" letters@herald.co.nz
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The Editor
NEW ZEALAND HERALD
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HSBC chief economist, Paul Bloxham, describes New Zealand as
the "rock star" economy among OECD nations.
I hope not. Rock stars have a nasty habit of burning out
early (the Rolling Stones being an exception) through drugs,
booze, and other nasty vices.
I recall that Ireland was described as the "Celtic Tiger"
between 1995 and 2000 - until it's economy crashed and
burned later. It's massive foreign investment led to an
unsustainable property boom which collapsed like a house of
cards in 2008 with the GFC.
The "Celtic Tiger" has lessons for our own nation, as we
also face an unsustainable property boom and associated
private debt that, by 31 June 2012, reached a staggering
$256.4 billion, or 125.3% of GDP (ref; RBNZ).
I've no doubt that the HSBC - a UK-based bank - is loving
our "rock star" economy. They are no doubt amongst big
lenders, funding our property speculation habit.
Trouble is, like most suppliers of a "habit", they will
eventually seek payment-in-full.
That's when we'll see how rock stars crash.
-Frank Macskasy
(address & phone number supplied)
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Above image acknowledgment: Francis Owen
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= fs =
Frankly Speaking... 