Posts by Matthew Poole
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Am I the only one who thinks that a lot of retailers will use a GST hike as a chance for a price hike over and above the increase in the rate of GST?
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And that stuff about CRIs could make it a very long term move, if it ends up being as bad as it sounds.
hmm? What're your concerns there? Just skimmed through the speech, and totally underwhelmed by so much of the knowledge investment section, but don't know enough background to know why you think the CRIs thing could be bad news.
We also see no mention of R&D credits, or indeed any other incentive for private enterprise to carry out R&D unless they happen to be in the sanctified agricultural sector.
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[Australians] seem to have made a much better fist of economic management in the last 25 years than we have.
More that, for whatever reason, they got lucky with electing leaders who didn't have stealth objectives, in either direction, who could then gut the country. We got Rogernomics by stealth, we got the last National government's hard-right positions on welfare, state enterprise and employment relations by stealth, and we currently have a spineless merchant banker who's blind in one eye and can't see out the other because he hid his true colours behind a façade of "Mr Middle New Zealand".
For better or worse, Australia's leaders appear to have been quite up-front about their aspirations and positions, and the Australians have been able to go to elections on the basis of what's really going to happen to their country. -
You know, it's not actually an inaccurate characterisation of what some of my younger non-property-owning friends have been saying this afternoon.
As a member of that vague group, were I not rather attached to my family and newly in a relationship Australia would be looking really tempting right now. It's not like I've got a job to hold me here at present.
Key has finally shown his true colours, and they're coward-yellow right the way through. No brains, no balls, just another election hovering on the horizon. Thanks for fucking nothing.
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Oh, I should point out that I'm talking about owner-occupied homes. Obviously a rental home produces something for the landlord, though on the evidence it produces less than nothing for the wider economy.
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So I reckon a house is productive like, say, and education. If that isn't "productive" in your terminology, then there is presumably another word which applies and renders the prevalent productive/unproductive dichotomy meaningless since it doesn't span the relevant options.
Provision of education is a service, certainly, and the property held and maintained to facilitate the provision of that service would likely be considered productive inasmuch as it requires upkeep such as cleaning and maintenance. It doesn't, however, constitute productive in relation to provision of education. The education can be provided under a tree, or in a park, or even in the middle of Aotea Square.
Is education itself a productive asset? Do you mean the provision of education, or the knowledge gained from education? The former is clearly productive to the educator, as it generates income, but for the educated it is unproductive as consumption of education requires time that cannot then be used for other things.Are people employed to maintain the shelter "machine"? Yes.
If that makes housing productive then I'll argue that cars are also productive assets because they keep mechanics employed. As an entire class of asset that may be true, but as discrete instances they're very definitely not productive.
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Keir, who's employed by residential property to provide shelter? Nobody. Therefore, it doesn't employ anyone to produce goods or services for consumption by others. Ergo, not productive.
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Keir, houses don't produce anything. They simply are. They might provide shelter, but provide and produce are not interchangeable.
Productive assets employ people to make things or provide services. A house doesn't employ anyone to provide shelter to its occupants, unless you're very, very wealthy and employ a staff, and even that is not actually the same thing. It's not producing anything for consumption by others, which is what one expects of a productive asset. -
And you can rent the house out as a productive asset.
I think your definition of "productive" differs markedly from the definition of "productive" used by most market commentators. It may be productive for the owner, but it's most definitely not productive for the wider economy. Since this entire debate is about trying to get some tax income out of what has turned into a massive black hole, "productive" is a rather poor choice of word on your part.
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But then wouldn't that mean less rental property available, and therefore further upward pressure on rental housing pricing?
Depends. Quite a few landlords own multiple rental properties. If it was one landlord-one rental property, it'd be a fairly easy scenario. However, when there's leverage spread across three, five, ten rental properties, it suddenly becomes desirable to reduce the leveraging in a big way but still hold onto several rentals so that there's an income stream. And, if there's not a CGT, the sale of some of those properties nets a nice capital gain (especially if it's older properties that were bought in the last "trough") and the rents in the remainder can be increased to cover the extra tax.
I don't buy the doom-and-gloom scenarios about landlords bailing out, to be honest. So they bump the rents a bit, tenants shuffle around the market to find somewhere they can afford, and life goes on. There'll be a period of adjustment, and in five years' time everyone will wonder what all the fuss was about. Of course, that requires National to have the brains and balls to do something that's not easy and isn't good for them personally or for their top-end backers. I won't be putting money on what Key announces will be the medicine we're to be fed.