yea im watching the housing down there

that's another problem you instigate when you dont use fiscal policy, bank reserves tend to end up in speculative areas

QE in the US is doing that almost as a goal, for same but outsized reasons

it comes from a belief in monetary policy to do things it simply cannot do

Mostly, NZ is doing well due to exports and foreign investment, but that has its problems.

Housing is built that is not affordable for residents and is more of an investment for foreigners, and never lived in.

Residents can't afford housing, and the government tries to help by subsidizing housing for the poor.

But there is still not enough to go round and there are state housing waiting lists, as well as a lack of affordable private housing.

@Sh0t If you visit...you can see a lot of flashy apartments, but also you can see folks living in cars.

there is plenty to go around, kiwis just belief like somebody in this chat does about gov surpluses, yada yada

20% debt gdp ratio :/

Well, govt policy in NZ is to gradually decrease the ratio.

It is openly talked about.

yea, that's why people are homeless lol

it's a bad idea

and it compounds because it also hurts aggregate demand and encourages private debt to make up the difference

Well, NZ used to build sufficient state housing, though over time governments slacked off, and the mood was to just leave it entirely to 'market forces'.

market can do it, but it's how the money enters the system. trying to do it via monetary policy just creates the very inequality they are trying to solve

Though...NZ went through a major economic transformation in the 1980s-1990s, as well as being cut off from the UK market and having the oil shock all at once in the 70s.

they are chasing a phantom going for budget surplus and austerity

NZ used to be an economy that was way more regulated and restricted.

you dont need to that

i'm all for laizzez faire, but you do have to be honest about monetary system

In NZ, policy tends to fluctuate by political party.

Labour is more willing to be flexible, though National has a major policy platform around running surpluses, low govt debt, and decreasing welfare spending.

Every election cycle, the govt debt and surplus level is brought up, as a measure of whether the govt is effective or not.

that entire conversation is a disaster

Both parties though tend to be consistent in policy to reduce the debt to gdp though.

https://www.macrotrends.net/countries/NZL/new-zealand/debt-to-gdp-ratio

Not the best site, but allows you to see it roughly.

they need to stop

It is hard to stop policy set by the reserve bank and political parties though.

@Sh0t

You'd have to change minds in a big way.

that's usually impossible, people have to die and new people come in

nobody can admit they were wrong

Hope you aren't getting frustrated too much talking with me. 😄

I am not really saying more than what I've been brought up to think.

i know, it's a major issue in the states

Literally, ask anyone from NZ what they think about government budget deficits and debt to gdp, and they'll view it as a metric of poor government policy.

partly it's because of neoclassical economics, but there is definitely some purposeful lying in there to brainwash people