NZ Debt $528.7 billion

New Zealand debt is now over half a trillion dollars, with nearly half of it household debt. Government debt is $96.9 million.

Sounds a lot.

17 Comments

  1. Loki

     /  June 10, 2017

    Two take away from this hysterical tweet by O’Sullivan.
    Govt debt is only 20 percent of total
    What is our debt to income ratio as a country…
    And the third because dodgy maths is the theme of this post.
    What is our debt to income ratio.
    This is a nonsense headline to scare the innumerate.
    Historic low interest rates.

  2. Blazer

     /  June 10, 2017

    NZ’s total assets are estimated at apx $800 billion,so not far to go before the whole country is effectively…owned by offshore lenders….just a result of….sound economic managers,and a ‘safe pair of hands’…approach.

  3. PDB

     /  June 10, 2017

    PG: “Sounds a lot”

    Crown debt is very low by International standards. Household debt is of more concern but there is a bit more to that: http://www.treasury.govt.nz/economy/mei/sep16/03.htm

    • Nice link PDB……it has context and analysis unlike the pictorial in Petes post….

  4. Meaningless with out the comparable assets owned and also more importantly the revenue streams flowing from those assets and work that service the debt….

    Just another bogus, half-arsed media job done to stir up angst without the proper context….

  5. Blazer

     /  June 10, 2017

    so debt at 160% of income is not a worry.Compared to other countries its…’low’.Debt ensures compliance and the whole financial construct is in effect a ..Ponzi scheme.

    • Critique, and wave flags BOL. Debt to Income at that level is a little high for me personal as it exposes people to interest rate shocks if their budgets are tight or adverse events happen like prolonged illness/injury/redundancy in a shrinking economy.

      But what is your alternative?

      The Government level of debt at this point in the cycle is too high for me, but the electorate and lefties in particular demand more spending – so repayment is curtailed.

      After the next election, if National retain the treasury benches, they should make debt repayment more of a priority – but I suspect they won’t instead choosing to prime the pump via spending to create inflation and inflate the economy to make the debt target as a % of GDP more easily attainable.

      The electorate spends for a variety of reasons beyond their means and borrows to fund it – do you propose a debt to income ratio for all adults enforced by the state to preclude borrowing too much? How would it work? What would the impact on economic activity and jobs be? Are you willing to slow the economy and job creation – possibly pushing up unemployment levels to achieve a low personal debt to income ratio across the whole economy?

      Lets hear your alternative

      • Blazer

         /  June 10, 2017

        there should be more prudent lending rules implemented by those hawking debt.30% interest is not uncommon in a climate of record low interest rates.As for housing,the banks are just irresponsible and this is the biggest sector of personal indebtedness.The govt needs to get some guts and legislate instead of sitting on its hands.Most economists concede NZ GDP is a reflection of loose immigration policy and the inflated housing market.Real productivity of goods is very stagnant.It is well documented that the FIRE or FIIRE (Pz)economy is a mirage where debt is treated as an ..asset!The usual defences of unemployment and economic slowdown if the vital issues are addressed is just a smokescreen.Over 200,000 work visas alone issued each year,just keeps wages down and increases profits to be repatriated offshore.e.g over 6000 visas for retail salespeople FFS!NZ for sale…is a bad long term strategy for NZ’ers, but a great one for international ,financial parasites who care not about sovereignty or the environment.

        • Alan Wilkinson

           /  June 10, 2017

          You want lower interest rates and lower debt? That’s never going to happen.

          You want young people to buy homes and not have big debts? That’s never going to happen.

          You want houses to be cheaper but bureaucrats and politicians to control building and land use? That’s never going to happen.

          You want cheap services and high wages? That’s never going to happen.

          You want to cut immigration and have plenty of workers and educated young people for the future. That’s never going to happen.

          You want high standards of living but no foreign investment or development of our “pristine” environment. That’s never going to happen.

          • Blazer

             /  June 10, 2017

            I see…you are a glass half empty…kind of guy..Al.

            • PDB

               /  June 10, 2017

              I see…..you are a keep it and eat it as well…….kind of guy..Blazer.

        • Alan Wilkinson

           /  June 10, 2017

          And just to emphasise the idiotic stupidity of this beat up, take a look at this map and list of external debt per capita by country. Figure out whether you want to live at the top of the table of the bottom.

          http://mecometer.com/topic/external-debt-per-capita/

          • Alan Wilkinson

             /  June 10, 2017

            FIP, or the bottom.

          • Blazer

             /  June 10, 2017

            so lots of debt=wealthy,and a high standard of living….right?

          • Very bizarre analysis and a recipe for turning Greek. Wouldn’t you at least want to turn Japanese, where you owe the money to yourself?

      • The alternatives according to the Reserve Bank are loan to value ratios (LVRs); debt-to-income ratios (DTIs) and higher capital requirements for housing loans (capital overlays). You could also limit the debt taken on by property investors by limiting investments to new builds only (see Australia) and/or limiting the amount loaned to the expectations of return.

        I don’t understand why you are so against government debt as in many cases they are in the best position to fund investment, i.e. through lower rates and because they have the clout to action the investment .e.g infrastructure. The government can also create money, like private banks, so as long as it owes the money to itself there is less risk of having to sell the family furniture to pay back debt, which could well happen in the private sector both on an individual and macro level.

        Let’s also look at what happen to countries who had a housing crisis. The debt was taken over by the public sector anyway. “In 2007, Spain had a budget surplus of about 2% of GDP and government debt stood at 40% of GDP (OECD Country Statistical Profile). That was well below the level of debt in Germany, France, and the United States. But by 2012, Spain’s government debt had more than doubled, reaching nearly 90% of GDP, as the public sector assumed large losses from the banking sector and tax revenues collapsed.” – http://www.frbsf.org/economic-research/publications/economic-letter/2014/march/private-credit-public-debt-financial-crisis/

        To me, our biggest problem is credit being used to fund consumption or “investment” in non-productive assets, like houses. We need to start turning that tap off while investing in enterprises that have global potential and local infrastructure, which can be tied to improved productivity. It’s a massive problem but we have to face it eventually.

        • Blazer

           /  June 10, 2017

          those are the solutions clone278…but this govt …just does not want to…know.