John Young on LinkedIn: Messing up in Boats & Trains - an alternative perspective A tough day for… (2024)

IF YOUR'RE INTO YOUR GLOBAL MACROA fascinating read from the FThttps://lnkd.in/gCF_HQj7 on the issues of over-regulation and the impacts on productivity -the outcomes of which could have some seismic implications for renewables and implications for achieving net zero.If you don’t have access to the FT, then here's the links to a couple of the reports mentioned in the article:(1)US Chamber of Commerce report:https://lnkd.in/gCqqNay5(2) Mario Draghi’s report on EU Competitiveness:https://lnkd.in/g_eJJgUbThere’s so much really interesting stuff in both reports, especially the EU one. I used to look at this data a few years ago, so the chart (attached) on trade policy measures naturally drew my attention. Trade protection is on the rise, especially around areas of renewables, and particularly solar panels. The EU’s PV industry has been decimated from low-prices Chinese exports (remember those stories of solar panels being used as fences in Europe?)The US is also taking a much more interventionist approach around products emanating out of Xinjiang, you can find the list of restricted/banned companies here:https://lnkd.in/gpdtimGgA growing number of them are manufacturers of PVs.Here’s a selected quote from the FT on the amount of legislation passed in the EU and US:“Draghi points out that, since 2019, the EU has passed around 13,000 pieces of legislation, while the US has adopted 3,500 laws and 2,000 resolutions.”For context, in NZ 358 bills have made it through to Royal Ascent since 2019. On a per capita basis NZ politicians make EU & US politicians look like slackers. POPULATIONUS: 333 milEU: 449 milNZ: 5 milIn the EU there’s is already pushback by some member states on the European Union Deforestation Regulation, and if Trump is true to his word and he's the winner in November's elections those trade protectionist measures will jump - haven't seen too many references to the Smoot–Hawley Tariff Act recently, strange given Equity market valuations ( caveated by the fact that I'm in a bubble of walking the dog )With that as a potential backdrop keeping below 1.5c looks like its going to be even more challenging.#tradeprotection #globalmacro

If you’re an asset manager/owner publishing a Carbon Footprint based off your holdings of publicly listed equities* , but have large Private Equity holdings it might be worth looking at the contents of this report before feeling good about your environmental ‘credentials’ .The report notes that 21 of the “leading private equity firms are responsible for 1.17 gigatons of annual emissions. That’s 1.17 billion metric tons of CO2 equivalent—concentrated in sectors like upstream fossil fuels, Liquefied Natural Gas (LNG) terminals, and coal plants.”To paraphrase Michael Caine ( legend): ‘I could not imagine 1 million tonnes of CO2, let alone 1.17 billion tonnes of CO2’Ludovic Phalippou #carbonemissions #globalwarming #carbonfootprints #michaelcaine *i still think using derivatives to measure a carbon footprint is misleading as per my National Business Review article https://lnkd.in/gxJwxYqu… and I’ve done a LOT of reading on the subject since then

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So the Singaporean politician mentioned in this post from a few months ago gets a 1 year prison sentence for accepting gifts of $300k… https://lnkd.in/eQK8zNXfIf Singapore is ranked 5 and New Zealand is really ranked above them at 3 on the Corruption index, then I’m a monkeys uncle

Karaoke? No, this is the CEO of Nomura apologising for the role his firm allegedly played in manipulating Japanese government bond futures prices* in 2021. The financial penalties were small ( about US$150k fine), but the cost from the societal shame being much greater as the likes of Toyota and other firms excluded Nomura from debt underwriting deals. Meanwhile, in NZ the Conduct regulator (FMA) looks like it might actually be out of the tiles enjoying some Karaoke** because we still haven't heard anything from them on the allegations of manipulation in a NZ government bond auction ( faaaar more serious)..and of course as all those primary dealers who were part of the 2022 syndicated offering/buyback have since participated in further primary syndicated transactions will put the FMA and NZDMO in awkward position if there is fire to the smoke.Oh, and if you've been following the travails of ANZ Australia there is this latest blow to their reputation:https://lnkd.in/g24DrE7aNot a great few months for them, but I have to say ( and I know I might get some flak for this) I think Shayne Elliot has done a good job ....you try running a big organisation with 40k employees and stay on top off everything ( I can say that after talking with a family friend who ran a global bank with several hundred thousand employees)* Of course NZ has no government bond futures because the capital markets have done nothing in the last 20 years I've been here but go backwards.** Their song choice was probably the old Sinatra classic, " My way"'And now, the end is nearAnd so I face the final curtainMy friend, I'll say it clearI'll state my case, of which I'm certainI've lived a life that's fullI traveled each and every highwayAnd more, much more than thisI did it my way...'Ol' Blue eyes...what a legend#goodchap #karaoke #bondmarkets

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LinkedIn can occasionally be usefulMost of the time I wish I wasn't on LinkedIn, and most of the people who get my posts wish I wasn't either. But occasionally I come across some great stuff which I doubt I'd find anywhere else, and even more occasionally it has proven a good platform for advocacy....and in this case I think might have helped get the wheels rolling on the story I posted below as after I bit of pestering I've gotten the local MP to visit the business owners and hear their case....hopefully the MP will be in contact with insurance company and get some resolution 🤞 Anyhoo the MP has now got my vote at the next election

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A good paper from a couple of my former colleagues at the RBNZ, which reminded me of an issue I was thinking about about 5 years ago, which is: What is the impact of IFRS9 on impairments ( delinquencies ) on banks' approach to credit risk and lending? Never got a satisfactory answer to my question then, if anyone knows shout out ...I'm still curious..No doubt it could be a short or a long answer.And the paper drew my attention to this section in the Deposit Takers Act 2023, on 'purposes':"To avoid or mitigate the adverse effects of the followingrisks:(i)risksto the stability of the financial system:(ii) risksfrom the financial system that may damage the broader economy."That sounds like more on the RBNZ having quite the micro interventionist policy around 'climate risks' .. which should be covered off by their prudential tool kit, and really shouldn't be part of a Central Bank's remit anyway ( because they have no real idea what those financial risks will be despite all their modelling) - perhaps yet another reason prudential supervision in NZ should be in a separate entity...by the way NZ is probably one of the few advanced economies where a Deposit Guarantee scheme is so deeply embedded in all the stages into the Central Bank. Also, I haven't heard back yet about my logo design for the Deposit Compensation Scheme: https://lnkd.in/e2UGbZ2R - you try and save the taxpayer some money and make things easier for them- nothin’ …but I guess they’ve got money burning a hole in their pockets #centralbanking #prudential

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non_STAN_dard m_OLLIE_tary policyOUCH… From a professor of macro economics at Auckland University:“Proof that NZ's Reserve Bank has Inflicted Unnecessary Pain up and down the Nation.In the past few hours, it has been stated that the US economy grew at a solid 3% rate last quarter, as given in the American government's final estimate. New Zealand's economy, on the other hand, shrank at a rate of -0.2%. The US Federal Funds rate (the equivalent of NZ's Official Cash Rate, OCR) is currently set at between 4.75 & 5 percent. By contrast, our OCR is presently at the higher rate of 5.25%. Meanwhile inflation in NZ was just over 3 percent for the June 2024 year, whereas inflation in the US was just under 3 percent for that same year. Given the Kiwi economy is hugely weaker than the US, and our inflation rates are almost the same, its a no-brainer that the Official Cash Rate should now be set far lower in NZ than the US right now - not higher. This Blog has consistently argued monetary policy was way too loose in NZ during the pandemic. The RBNZ $100 billion money printing program - one of the world's largest - was a knee-jerk reaction, especially when the virus did not ravage NZ remotely like it did many other nations during 2020-21. Then in another panicked knee-jerk reaction, the Reserve Bank Governor announced he was "engineering a recession" with punishingly higher interest rates to get the inflation he created back down again. The rest of the world is currently enjoying a "soft landing", which this Blog argued years ago that NZ should also have aimed for. The fact interest rates are higher here than in the US when our economy is stagnant & theirs is booming is revealing of a gross error in our monetary policy.”Source: https://lnkd.in/gpf7W3rgCan’t disagree with the ‘intellectual mistake*’ of doing QE **🫏 in NZ 🇳🇿 - no material benefit, but a lot of fiscal pain 🤕 and zero accountability.....'hmmmph!'* Mervyn King’s term** The $100bio quoted in the blog piece was the maximum amount the RBNZ was allowed to purchase under the letter of indemnity from the government, total bonds actually purchased was approx NZ$59bio #centralbanks #monetarypolicy #newzealand

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