Posts by Rich of Observationz
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I was asked this month by two separate and equally intelligent persons whether in NZ we called the northern winter months "winter" or "summer".
It's slightly arbitrary that when northern hemisphere people visited or lived in the southern hemisphere for the first time they chose to associate seasons with the suns angle.
They could have chosen to regard the seasons as purely temporal so that we had cold summers and hot winters. After all, concepts of summer and winter don't really apply in the tropics, but are still used (when is summer in Singapore?).
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Also, on the Cullen Fund thing, the cost of capital for NZ companies would fall due to their having access to an artificially ring-fenced pool of equity funding. This would be paid for by pensioners getting a reduced super payment, or by future taxpayers making up the difference.
Cheap capital would have certain advantages, in that businesses would choose to incorporate in NZ rather than overseas. We'd probably have NZ-owned banks again, for instance.
The downside is that pensioners/taxpayers would be paying for this.
I'm unconvinced that the benefits would outweight the downside, unless there was a sustained inability for NZ firms to raise capital (which I don't think there is when jetpacks are getting funded). The real problem for most business is finding paying customers, not investors.
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What about the fact that the scheme doesn't seem to distinguish between deposit-takers
New finance companies rated below BBB- won't be able to enter the scheme, whilst those rated below BB will have to pay a 3% fee. I'm assuming that the new regime for them will also involve the same reserve requirements as banks, so they will no longer be able to lend out all the funds they raise and will have a buffer of money on deposit with the Reserve Bank.
My guess is that the "last-resort lender" function of finance companies will gradually wither away. If they exist at all they will need to compete with banks on service rather than by attracting high-risk business.
The alternative would be to have the entire sector collapse in a few weeks, with a likely knock on effect on the property development and car-yard business (while I'd personally like to see property and used car spivs starved to death in debtors prison, I can see that our soft centrist government would baulk at this).
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You'd expect (assuming some return to normality) that the NZX total market cap would have increased substantially by 2025, so the Cullen Fund money would be less of a proportion of this?
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Also, regarding Rodney's past careers, I thought National politicians prided themselves on a background in business and farming before being tapped to lead their people?
Apart from a brief job on an oilrig (how did he fit in the helicopters) and recent appearances as a light entertainer, Rodders has basically been a student, lecturer and politician his whole working life.
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Re Lincoln: At least it wasn't AUT University - which I always think of as the Auckland University of Tautology.
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My understanding (which comes from reading Simon Napier-Bell's book Black Vinyl White Powder) is that until the late 50s/early 60s a record company would buy the rights to a song. They would then recruit musicians to record a version of the song.
After the Beatles and others came on the scene, things changed to a situation where most groups wrote their own songs.
I don't have the book in front of me so might have this a bit wrong, but can look later.
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My understanding of the argument made by Mark Kneebone above is that filesharing will (if the copyright enforcement powers sought by the industry aren't granted) undermine the economics of the recording industry and drive them out of business.
My point really is that if this did happen there would still be music played through radio and other media. I'd assume that the record companies would not die but would move to a more viable business model (just as they did when the industry switched from publishing to recorded music around 1960).
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It's already possible for the IRD to tax gains on property speculation
Yes, but the law's so vague it creates no certainty. How do you determine what someone's "purposes and intentions" were?
If they started to enforce it rigorously it would cause much wailing from people that (maybe reasonably) expected not to be taxed.
A simple rule that (for instance) taxed profits from sales of second properties, first properties worth over $600k and properties rented out for more than half the period of ownership would leave people in no doubt.
What should really be done is to have a house price policy that in the long run seeks to limit price rises to below the rate of general inflation. There are a bunch of ways of doing this (removal of negative gearing and LAQCs, capital gains tax, transfer tax, mortgage interest tax, minimum mortgage rates, etc).
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All of which comes from record companies or other marketing organizations.
Yes, but if the record business imploded, radio stations and the like would still play music.
Every time I walk down Cuba St, I see posters for another half a dozen new bands I've never heard of. I'm sure most of these guys will never make a bean from their music, but that doesn't seem to stop them creating it.
I'm unconvinced that the public interest in there being a "music industry" justifies that industry being given draconian powers to protect their business model.