They Aren’t Blaming The US
According to TV New Zealand Aussies blamed for NZ recession
Slowing consumer spending in Australia has been blamed for helping to tip the New Zealand economy into recession for the first time in a decade.
The New Zealand economy shrank by 0.2% in the June quarter, marking the second successive quarter of contraction and signalling the technical definition of a recession.
This kiwi slowdown followed a 0.3% decline in gross domestic product (GDP) in the March quarter.
If consumer spending is slowing in Australia, they are nervous, and we have even more of the world involved in a bad case of the jitters. With all of the recalls and other problems in China, they will be drawing back, so the pieces are dropping into place for another Depression.
3 comments
LOL Spending has been slowing here because the cost of everything is going up thanks to the insane oil prices. 🙂 We pay more for fuel here than you do in the US. Maybe NZ should get their own economy happeneing instead of relying on Aus spending habits. LOL The truth is, the NZ economy has been a disaster for over a decade. *shrug*
The other fact is, we have just had 2 interest rate reductions since Rudd became PM. However, unemployment is rising due to several multinationals (mainly US based) closing shop here in the past couple months. They are desperate to cut costs. That how come we know just how bad things are for US companies. You don’t close plants when you are making profits. 🙂 Of course, they call it *restructuring* LOL
Everyone always wants to blame someone else for their own problems. Especially politicians.
Ach the Kiwis have joined Denmark and Ireland (the Celtic Tiger looks like a mangy cat at the moment). Italyand Germany are set to follow, the UK economy is at a standstill but is almost certainly in reverse. It’s looking bad all over Bryan
Oil prices and profits are at the heart of the problem. The rapid run up in the price of energy affects everything because there are no large inventories anymore, everyone is dependent on constant shipments of goods. Anything that affects shipping has an immediate effect on the ability of business to operate. Retailers couldn’t simply sell down their inventories while waiting for shipping prices to drop, the increases has to be absorbed and passed along to customers.
Actually, restructuring is no longer limited to a “return to profitability”, it now takes place to increase profits. Maximizing profits is all the stock markets care about, so everyone is consolidating and moving facilities to the cheapest area they can find.
All of the slack and redundancy in the markets that could cushion a shock have been squeezed out, so that even minor glitches have an immediate effect.