Massive currency blunder
July 30th, 2007 at 9:31 am by David FarrarThe SST had a story yesterday about how the Government accidentally revealed to them in an OIA request how much money the Reserve Bank is willing to risk when intervening in the level of the dollar.
Once the speculators know this, the game is over and NZ is the loser.
The Government should be holding an inquiry into hos this happened. This is not a minor mistake, but a huge fuck-up.
No tag for this post.
July 30th, 2007 at 9:37 am
This is not a minor mistake, but a huge fuck-up
Yep – and I’ve; been saying this was bound to happen ever since the stupid intervention project started. Let’s open up a black hole and just pour taxpayers money in!
Cullen must go. Now
And the rest of em.
Vote:July 30th, 2007 at 9:46 am
it only matters if the info gets to the market, and the Sunday Star Times agreed not to publish it,
and even then it doesn’t matter a lot, unless the martkets assumptions on what the Reserve Bank put in are out by huge amounts, or the numbers reveal a totally different level of reserves for intervention than the market had assumed..
Vote:July 30th, 2007 at 10:08 am
Bullshit Sam – and you know it! That’s akin to saying that it was ok for Benson-Pope to lie to the House as long as no-one found out about it, or it was ok for Labour to rort the taxpayer as long as no-one found out about it or it was ok for the PM’s motorcade to speed as long as the media didn’t tell anyone.
In any event, the lickspittle tv journos were too busy in damage control after their role in Benson-Pope’s demise, and the embarrassment it caused Dear Leader, to run another Labour-cocked-it-up story so soon!
Vote:July 30th, 2007 at 10:09 am
So Sam,
Vote:You have made how much by speculating in the currency market then?
July 30th, 2007 at 10:27 am
Sam – so we accept that the last line of defence of the the security of the $NZ, Reserve Bank strategies, Cullens plans etc etc is…the Sunday Star Times newspaper? And that’s OK?
You suddenly have a lot of faith in the MSM.
Vote:July 30th, 2007 at 10:40 am
What with Police Internal Affairs Treasury Minister of Finances Office Department of the Environment its going to be a busy for Mrs Peter Davis having to hose down all those fires. And then there next weeks lot for her to deal with.
Vote:July 30th, 2007 at 10:44 am
Good God there is no action or mistake or blunder done by this Government that Sam won’t minimise or justify.
Vote:July 30th, 2007 at 10:44 am
Sam..”it only matters if……”
Laughed out loud at that one.
This is a monumental cock up and the fact that the good folks at the SST behaved appropriately doesn’t lessen the fact that someone accidentally gave away the keys to the vault containing the family silver.
Only the SST handing the keys back saved us from potentially losing the lot.
Vote:July 30th, 2007 at 10:45 am
Probably on the fence on this one. Agree it is not good news that the markets have this information. But in reality the RBNZ reserves position will be shifting all the time now. The markets are selling NZD agressively anyway so the whole issue is moot now anyway.
Vote:July 30th, 2007 at 10:52 am
Sorry KT, have to disagree.
The fact that no damage was done does not hide the incompetence of those invloved.
Is it ok for potentially devastating errors to be made as long as the potential isn’t realised?
Huge relief that no damage as done, but that was hardly because of the action of those involved in releasing the info. They got lucky.
Incompetence of this magnitude cannot be tolerated, surely. Will we be so lucky next time?
Vote:July 30th, 2007 at 10:58 am
Yes, there is no doubt that it is incompetence, and heads should roll.
Vote:In the past when Roger Douglas’ office released sensitive budget info by accident, he offered to resign.
But I wouldn’t hold my breath this time round.
July 30th, 2007 at 11:31 am
Michael Cullen pours over OIA releases and deletes anything he does not like plus he determines when it gets released and considers whether he should make a general release and anything else he can do to manipulate things to his political advantage. But strangely he is silent on this. Puts out a whole lot of spin that the figures are historic (they cannot be that far out) and much else. But does he accept repsonsibility, no way he runs for cover and gets officials to take the blame. This blunder involves the release of top secret information which will cause considerable losses to the tax payer and renders a policy of currency intervention even more foolhardy.
Vote:July 30th, 2007 at 12:42 pm
Is this representative of the standard of service our employees are delivering ? God knows how many more cock-ups are actually covered up before we the poor citizenry find out.
Vote:July 30th, 2007 at 1:56 pm
The SST didn’t kindly had the documents back and agree not to publish, if you read between the lines it was threatened with legal action if it did not return the documents immediately, which highlights how seriously the RBNZ recognised the blunder. In any case the RBNZ is dreaming if it thinks it can do anything to influence the currency so why it would bother is beyond me. The Bank of England was burned severely trying to do so.
Vote:July 30th, 2007 at 3:02 pm
Of course sending out the figures was a screw up, it shoudln’t have happened. but its not major screw up poltically or emconomically because
a) it has had no impact on the markets
b) it was an accident by some low-level treasury official, so has no implications for the competency of the Government
(don’t say, ‘but Cullen signed off on the letter, he signed off on the letter he wrote in reply to me the other day too – and probalby a few hundred other things a day, a Minister has the right to relay on the competency of his officials in preparing such things)
Vote:July 30th, 2007 at 4:53 pm
Well I guess even the coffee lady at Fairfax will know what the figure is now and if they are enterprising enough could sell it to a hedge fund for a handy bonus.. The figure won’t be historical unless Cullen has been forced to change it. Even if it is it will be a ballpark indicator to the traders.
Vote:July 30th, 2007 at 5:04 pm
This information will cause grave damage to NZs interests and the Fairfax group should hand the information back forthwith. But thankfully it will render foolhardy any notion the Government can meddle in the international currency markets.
Vote:July 30th, 2007 at 5:05 pm
“……..a Minister has the right to relay on the competency of his officials in preparing such things”
Agree completely. However, as the ultimate authority, who is paid accordingly, a minister must also take responsibility for the actions of his staff. If it is someone elses FAULT, then deal with it accordingly, but it is his RESPONSIBILITY. A word that is not in the dictionary of most politicians.
This is a cock-up of banana republic proportions.
Vote: