Business Confidence crashing
April 1st, 2008 at 12:48 pm by David FarrarThe National Bank has released its latest monthly business confidence results and it is not pretty:
This month’s National Bank business confidence survey makes for grim reading. A net 58 percent of businesses expect business conditions to deteriorate over the coming year. This is down from 44 percent reported last month. Confidence is weaker across all the five major subgroups: retailing, manufacturing, agriculture, construction and services.
Firm’s expectations towards their own business has now turned negative, the first time since early 2006. A net 6 percent of businesses expect a deterioration in their own business over the coming year. Firm’s own activity expectations are seldom negative. Negative reads in firm’s own activity expectations have only been recorded 12 times in the 20-year history of the survey. Five of these were right at the start of the survey in 1988, as the 1987 crash washed through. The last time we saw firm’s own activity expectations this weak was in 1991.
Also National Bank needs to be a finalist for the 2008 spin awards with this line:
While recessionary fears are percolating, we prefer to characterise such challenging times as entering a stage of deferred achievement.
Ha. Watch Dr Cullen grab this line. It is not a recession, just a period of deferred growth 
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April 1st, 2008 at 12:59 pm
All these people, and all these surveys, feed off each other.
We have just experienced eight years of the most sustained economic growth in our history, but it is never reflected in these surveys, which are always of pessimism.
I wonder how some people get out of bed in the mornings, life is so miserable.
Vote:April 1st, 2008 at 1:03 pm
Running my own business I think this is going to be a bumper year. You make the best out of any situation and I believe this situation is going to provide plenty of opportunity.
Vote:April 1st, 2008 at 1:05 pm
The NB has a history of being way off the mark with their “confidence” surveys.
Plus when they have been so good of course no one is going to expect it to be as good this year.
Vote:But prepare to be surprised, the december quarter had growth powering along and this year wont be so bad when the drought figures are excluded.
April 1st, 2008 at 1:17 pm
yup infused I agree – yes times are hard (yes I have creid into my beer about it) but like someone said to me – ‘when the going gets tough; the tough get going.” Am I confident I will be a millionaire in the foreseeable future – No. Am I confident that business will improve – yes. But it looks like they didn’t ask me eh?
Vote:April 1st, 2008 at 1:29 pm
“deferred achievement”… isn’t that what they tried using in NCEA before they adopted “not yet achieved”??
Vote:April 1st, 2008 at 1:32 pm
ASB
Goldstein’s people at ASB are in the business of favouring their large overseas clients at the expense of NZers.
ANZ is in the business of spending NZ money at whatever risk [ING] to return 1.5% to themselves.
They pointedly say they are only Managers of your NZ money and as long as they make money too bad for idiot NZ investor [ING] Beware NZers of [reputable] Bank finance companies
BNZ Tony Alexander BNZ is a write and speak piece for Helengrad and doesn’t know where his forked tongue points till she tells him ..
Lee C with a attitude like that dude you will be a millionaire soon, claim your GST and switch currency now
Vote:April 1st, 2008 at 1:33 pm
A National Bank quote – “…….entering a stage of deferred achievement.”
Sounds like NCEA speak to me (= “Not yet achieved”). To the usual tax payer this means “FAILED”.
Election please.
Vote:April 1st, 2008 at 1:38 pm
ghost said “But prepare to be surprised, the december quarter had growth powering along and this year wont be so bad when the drought figures are excluded.”
Yeah, you got it ghost…..when they factor out record interest rates, record petrol prices, the 7% increase in rentals, food price inflation and the downturn in the housing market, everyhting will be fine. There’s just one problem with that approach. It’s things like interest rates, and fuel, rent and food prices that are causing people to have a pessimistic outlook! I realise that’s an inconvenient truth for the government, but it is one that they will have to live with.
Vote:April 1st, 2008 at 1:41 pm
Well put inventory.
Vote:April 1st, 2008 at 2:33 pm
What is surprising to me is that business confidence has taken nine years to figure out that Labour are poison to prosperity… have they had their heads in the sand since Shipley lost power?
Vote:April 1st, 2008 at 3:02 pm
Inventory 2,and discerning peoples .. south island of new zealand,
Vote:we have water
April 1st, 2008 at 3:17 pm
If your a babyboomer the past 9 years should have set you up for life Lovely jubbly Socialists policy coupled with strong internatiional growth means opportunity to grow asset base and diversify ( not into multiple finance cos).
The next cycle is flat/downwards a bit and then starts all other just in time to top up the asset base before retirement. And you should have been able to set up ways and means of helping the kids a bit given the tax free capital growth.
Go talk to anyone living in capital gains taxed environments and watch their eyes glaze over when you tell them all your gains are tax free.
Vote:April 1st, 2008 at 3:22 pm
Ghostie
“and this year wont be so bad when the drought figures are excluded.”
What? So has the government found a way of forcing grass to grow by Order in Council?
The drought is a fact of life. It genuinely will lower the GDP this year (and probably next year). And while it isn’t in any way due to the government, nor have been some bumper growing seasons over the past few years, not to mention rising world prices for our commodities.
That’s the thing about being in government – you have to take the good with the bad. Trying to take credit for the good and exclude the bad from the stats is a fiddle, and everyone will see it that way.
Vote:April 1st, 2008 at 3:30 pm
Dont be silly inventory2. The drought is unexpected and gives a measureable impact on GDP.
No one has mentioned all the other factors but the Global Credit crunch can be hardly laid at the door of Cullen, who by the way has made sure the government is in a very strong fiscal situation so that we will ride through pretty much Ok.
Compared to 10 years ago when Shipley and English lost their nerve over a small correction in Asia
Vote:April 1st, 2008 at 3:36 pm
Interesting that DPF decided not to put this up until the afternoon in case it was not taken seriously.
Vote:April 1st, 2008 at 3:38 pm
Bobux, no the drought is a one off event and legitamately can be excluded.
As many companies do when they report one off events which havent affected the overall results.
The good news is due to Cullens fiscal responsibility we wont be adversely affected by the recklessness of others who spent time on wall st
Vote:April 1st, 2008 at 3:40 pm
Murders are down this year , like last year.
Vote:Full credt to labour!!
10 year low something is OK
must be those very long sentences labour has allowed judges to set
April 1st, 2008 at 3:42 pm
so..42% still in economic-tsunami-denial..eh..?
around some parts..these delusional ones are called ‘the farrars’..
(apparantly after their propagandist of choice..so i’m told..)
phil(whoar.co.nz)
Vote:April 1st, 2008 at 3:49 pm
INFUSED….Are you a debt collector or a Health Services Provider to a D.H.B.
Vote:April 1st, 2008 at 4:45 pm
The National Bank won’t be deferring it’s achievement, I’ll bet. Nor will the other multinational money lenders. They’ll simply keep on raising the rates for everything from mortgages to business loans, pushing the productive elements of the economy to the brink of bankruptcy while ensuring their own returns grow.
And before the howls of outrage start, yes I know they have a right to do business and make a profit. But the economy is like a boat… when it starts taking on water we all need to start baling. If someone’s sitting down the blunt end not lifting a finger to help, growing fatter by barbecuing the carcasses of fellow passengers who expire along the way, then whether that’s their “right” or not they deserve contempt.
Vote:April 1st, 2008 at 4:52 pm
“The good news is due to Cullens fiscal responsibility we wont be adversely affected by the recklessness of others who spent time on wall st”
- Apart from the hit the Cullen Fund has taken. Or the hit that Kiwisaver funds have taken. Or the high interest rates at the moment that are being driven by the credit crunch. Or the payout that Auckland Airport shareholders never got.
Vote:April 1st, 2008 at 4:57 pm
Recessionary fears are just that.
gd
Yes many have built up capital in recent years – based on the rising asset value of their homes (some from investment in shares and other property). But this capital gain would have occurred anyway over a longer time frame – and is only realisable now (without borrowing) if people offload surplus property (and without collapsing the markets values) to dumb investors or first home-buyers.
The price we pay for this, is seen in the huge increase in our foreign debt (people borrowing 100% mortgages to buy up the housing) and the long term upward impact on our OCR, business borrowing costs and dollar (reducing business profitability)
Yes some have profited, but the economic cost elsewhere is high.
Vote:April 1st, 2008 at 5:37 pm
the whole system is rotten..and unsustainable..
we need a major re-jig of just about everything..
anyone who can’t see that..
well..!
(you could be a ‘farrarist’..)
phil(whoar.co.nz)
Vote:April 1st, 2008 at 6:39 pm
And the head wanker speaks to make it a full wankathon from the left.
Vote:April 1st, 2008 at 6:52 pm
or you could be muzza..
phil(whoar.co.nz)
Vote:April 1st, 2008 at 7:01 pm
Hi Philly Whoar – do you rub your bong until ejaculation occurs and smelly water goes all over your keyboard?
Vote:April 1st, 2008 at 9:27 pm
ah..!..the sparkling repartee of d4j(erkoff)..
in a previous life surely a member of the alonquin (?) roundtable..?
a prominent diarist possibly..?
phil(whoar.co.nz)
Vote:April 2nd, 2008 at 6:33 am
>>While recessionary fears are percolating, we prefer to characterise such challenging times as entering a stage of deferred achievement.
Ha! As the Australian banks all implement/commission new credit scoring models and systems to raise the bar for borrowers to jump over/existing borrowers to jump over re: rate resetting
What are the sales shysters at the mortgage brokers saying at the moment?
* Pero
* Adam the cricketer
* NZ Home loans
Be interesting to see a summary of their latest press releases, or have they all gone veeery quiet of late.
Vote:April 2nd, 2008 at 6:41 am
Philu, can you summarise your thoughts without using (…)’s and …’s?!
Vote: