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GE Acquires Stake in Start-up – Analyst Blog

Zacks Market Commentaries — Fri, 16 Oct 2009 17:02:12 +0000

Tendril, the developer of the first integrated software/hardware platform to enable real-time, two-way communications between utilities/retailers and their customers on energy supply and consumption, is broadening its smart grid relationship with General Electric Company (GE) beyond appliances with an equity investment by GE Energy Financial Services.

GE Energy Financial Services is treating the venture capital investment as a follow-up to Tendril’s announcement in June that it raised $30 million in Series C funding, making it one of the best-funded energy management startups.

The Tendril Residential Energy Management Ecosystem (TREE) is designed to help utilities operate more efficiently to improve customer service and comply with new regulatory requirements.

GE’s investment builds on its appliances partnership with Tendril. GE Consumer & Industrial and Tendril announced in July that they would integrate the TREE Platform to work with GE's dryers, refrigerators, washing machines and other appliances. GE appliances such as stoves, washers and dryers, dishwashers and refrigerators will communicate their power needs to the utilities in real time. The utilities can then redistribute power as needed more efficiently.

Tendril is a strategic complement to GE’s suite of ecomagination and smart grid investments and products, with multiple commercial and technology development opportunities for collaboration.

In other smart grid initiatives, GE Energy Financial Services has made a venture capital investment in Grid Net, a leading provider of open, interoperable, policy-based network management software and communications products for the utility industry's smart grid.

GE Energy Financial Services’ experts invest globally with a long-term view, backed by the best of GE’s technical know-how, financial strength and rigorous risk management, across the capital spectrum, in one of the world’s most capital-intensive industries, energy. GE Energy Financial Services helps its customers and GE grow through new investments, strong partnerships and optimization of its more than $22 billion in assets. Major competitors of GE are Koninklijke Philips Electronics NV (PHG), Citigroup Inc. (C) and Siemens AG (SI).

We currently have a Neutral recommendation on General Electric.
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Read the full analyst report on "C"
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Energy Blackmail is a Well Practiced Art

Robert Amsterdam — Tue, 13 Oct 2009 18:20:17 +0000

The Nord Stream pipeline is back in the news this week, and unfortunately it's not main stream press reviews of Grigory Pasko's documentary. The Financial Times was carrying a three-frame photo in its special Russia business pull-out section of Vladimir...

Commodity Insights from LondonCommodity Insights from London

Frank Holmes — Tue, 13 Oct 2009 05:00:00 +0000

Brian Hicks, co-manager of our Global Resources Fund (PSPFX), is in London this week for the London Metal Exchangersquo;s 2009 Metals Seminar, which kicked off the annual LME Week gathering of leading commodities analysts from around the world. Here are Brianrsquo;s notes from the seminar: Danny Quah, professor at the London School of Economics, gave a compelling presentation that centered on China and the global recovery.nbsp; His main theme focused on the global economys shifting center of gravity, which has been steadily moving eastward to China over the past decade.nbsp;nbsp; He also mentioned that China isnt dependent upon U.S. consumption to create growth ndash; that notion is an old paradigm from the 1970s. Exports to the U.S. only make up approximately 15 percent of total exports, versus the 40 percent of total exports going to Southeast Asia.nbsp; Michael Jansen, director of commodities at JP Morgan, is one of a few who see a V-shaped recovery, given the rapid and unprecedented response to the financial crisis. Jansens Copper outlook: Imports to China may halve through the rest of the year, but should still remain at high levels.nbsp; Scrap is tight, but it has improved. Copper is the quot;bestquot; way to play the developed-markets recovery given a strong rebound in industrial production.nbsp; Risks to mine supply remain ndash; 3.7 million metric tons of production is up for contract negotiations in 2009. Jansens Aluminum outlook: While it is true there is too much inventory and capacity, Jansen still believes prices may go higher early in 2010 due to potentially large primary buying/restocking.nbsp; Fabrication demand should pick up due to low inventories. Jansens Nickel outlook: A bit of a pick-up in European stainless steel orders has been offset by a slowdown in China.nbsp; Xstrata has curtailed high cost nickel production and cut costs, bringing down its average cost to $3 per pound.nbsp; Despite a 20 percent cutback in mine supply, some people I met still think there is too much capacity and more cuts are needed.nbsp; Jansens Zinc outlook: Galvanized steel could pick up materially given that only 50 percent of global infrastructure projects are in place. Chinese auto sales also should be supportive for the zinc market.nbsp; We could see a 146,000 metric ton deficit in 2010. Jeffrey Christian, managing director at CPM Group (and author of ldquo;Commodities Risingrdquo;), highlighted that the lack of credit availability is the biggest risk to the recovery near-term, while slow growth in energy supply is the biggest risk longer-term. Please consider carefully a fundrsquo;s investment objectives, risks, charges and expenses. For this and other important information, obtain a fund prospectus by visiting www.usfunds.com or by calling 1-800-US-FUNDS (1-800-873-8637). Read it carefully before investing. Distributed by U.S. Global Brokerage, Inc. Foreign and emerging market investing involves special risks such as currency fluctuation and less public disclosure, as well as economic and political risk. Because the Global Resources Fund concentrates its investments in a specific industry, the fund may be subject to greater risks and fluctuations than a portfolio representing a broader range of industries. All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor. Holdings in the Global Resources Fund as a percentage of net assets as of 6/30/09: Xstrata 0.00% #09-713

Turkey’s Geostrategic Energy Role

Robert Amsterdam — Fri, 07 Aug 2009 14:47:29 +0000

Given all the news this week of Russia and Italy's South Stream deal with Turkey in exchange for a nuclear power plant, I thought I would repost an article written by Robert Amsterdam last fall in Energy Risk on Turkey's...

STDF Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract (DrStockPick Stock Report)

Dr. Stock Pick — Tue, 28 Jul 2009 11:02:45 +0000

STDF, Steadfast Holdings Group Inc, STDF.PK DrStockPick Stock Report! DrStockPick News Report! STDF, Steadfast Holdings Group Inc, STDF.PK “Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract“ DrStockPick Stock Report! Tuesday July 28, 2009 Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract Steadfast Holdings Group, Inc. (OTC PINK SHEETS: STDF) through its Banx and Green Group, Inc. subsidiary [...]

STDF Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract (DrStockPick Stock Report)

Dr. Stock Pick — Mon, 27 Jul 2009 14:12:54 +0000

STDF, Steadfast Holdings Group Inc, STDF.PK DrStockPick Stock Report! DrStockPick News Report! STDF, Steadfast Holdings Group Inc, STDF.PK “Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract“ DrStockPick Stock Report! Monday July 27, 2009 *********************************************** Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract Steadfast Holdings Group, Inc. (OTC PINK SHEETS: STDF) through its Banx and Green Group, Inc. subsidiary [...]

STDF Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract (PennyOmega.com Stock Report!)

PennyOmega.com — Wed, 22 Jul 2009 18:05:53 +0000

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STDF Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract (DrStockPick News Report)

Dr. Stock Pick — Wed, 22 Jul 2009 17:04:13 +0000

STDF, Steadfast Holdings Group Inc, STDF.PK DrStockPick Stock Report! DrStockPick News Report! STDF, Steadfast Holdings Group Inc, STDF.PK “Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract“ DrStockPick Stock Report! Wednesday July 22, 2009 Steadfast Holdings Group, Inc. Subsidiary Lands $28.6 Million Building Contract East Haven, CT - (WORLD STOCK WIRE) - July 22, 2009 — Steadfast Holdings Group, Inc. [...]

The Answer is Blowin in the Wind

Contrarian Profits — Fri, 27 Feb 2009 17:08:06 +0000

pRiding on the Go-Green trend, wind farms are developing quickly and there is opportunity for major expansion. David Fessler of a href="http://www.investmentu.com/" class="alinks_links"Investment U/a points out three companies that hold potential profit in the near future./p pThis from David:/p blockquotepThe World’s Largest “Air” Force…/p pMention “Air Force One” to someone here in the U.S. and visions of a Boeing 747-400 with the Presidential Seal on the side quickly come to mind./p pBut now there’s another new meaning associated with the phrase, and it’s good news for the guy that gets to ride in the jet./p pIn 2008 America became the global force in wind-generated electricity. President Obama can take heart in the fact that his pledge to cut imports of foreign oil is already underway, at least in#8230;/p/blockquote

Ethanol Companies in Trouble; Experts say Industry Will Survive

The Energy Report — Thu, 19 Feb 2009 20:35:00 +0000

Not so long ago, the biofuel ethanol was a political and policy darling as gas prices soared and the world focused on reducing emissions. But the companies that produce the colorless liquid appear to be running into trouble as the global economy tanks. Canadian producers are shelving plans to build or expand plants and U.S. companies [...]

The New TARP, Stocks Cheap Enough Yet? Escaping the Global Recession, The Dububble, and More!

Contrarian Profits — Fri, 14 Nov 2008 08:47:45 +0000

Paulson reworks financial bailout: New targets for investment… even you can apply! Markets plummet… Bill Bonner on when stocks will be cheap enough to buy. OECD predicts global recession… Germany admits contraction has already begun. Wall Street CEOs forecast “rapid,” “deep” U.S. recession. Joel Bowman on a peculiar hissing sound emitting from the Middle East.

For an erudite debate over the Paulson doctrine, we turn to our friends at The Onion this morning:

The Money Hole.

It’s not any more complicated than that, is it?

Indeed, Paulson and company announced a TARP switcheroo yesterday. Now the Treasury’s Troubled Asset Recovery Program (TARP) is suffering a serious case of the STD “mission creep.”

Instead of purchasing troubled assets from banks, the Treasury, as of this morning,…

Energy Risk: Turkey’s Political Pipelines

Robert Amsterdam — Thu, 09 Oct 2008 17:38:53 +0000

Below is a new article authored by Robert Amsterdam in the latest edition Energy Risk on the East-West tug-of-war going on in Turkey over critical supply routes, and how the energy diplomacy game has been affected by the war in Georgia. RA has written for this publication in the past, and delivered a speech at their 2007 conference in Houston.

Turkey's political pipelines Turkey's strategic position at the crossroads of East and West has put it at the centre of a geopolitical tug of war, with energy supply a key driver. Robert Amsterdam examines the energy policies being brought to bear in the region Turkey's role in global affairs is defined by its geostrategic importance as the bridge between Europe and the Near East. Following Russia's invasion and occupation of Georgia in August, which caused considerable energy supply jitters, Turkey was once again thrust into the spotlight as the European Union considers its dwindling options for alternative supply routes beyond the reach of Gazprom, Russia's natural gas oligopoly.

Chile’s Economy In Perspective – October 2008

Edward Hugh — Sun, 05 Oct 2008 22:21:00 +0000

Chile Country Outlook

Claus Vistesen: Copenhagen

Executive Summary and Outlook on key indicators

There are many lenses and perspectives through which to look at economic development. In this note, the process known as the demographic dividend is conceptualized in a Chilean context. The analysis shows how Chile during the past two decades has benefited from the dividend proxied by the increasingly favorable trend in overall age structure of the society. By some measures Chile’s demographic dividend is ending in these very years, but by adapting a slightly broader definition of the optimal working age and subsequent productivity profile it appears that Chile still finds itself in the proverbial sweet spot. Coupled with the favorable windfall from copper exports and the subsequent transformation of this into an unprecedented net wealth position of Chile’s public accounts, the economy looks on a very solid footing to face whatever travails which might come next.

As for the immediate outlook for Chile it appears that a slowdown is steadily rolling its way in. Tightening credit supply by financial institutions, a hawkish central and deterioration in terms of trade (forecast by the central bank) are all factors to be taken into account. Finally, a slowdown in the economy’s rate of job creation rate suggests that the slowdown may now finally be set to take hold in the immediate future. Consequently, headline GDP is expected to moderate somewhat in H02 2008 and H01 2009.

Chile has benefited immensely from the global boom in commodities and specifically the surging price of copper. The revenues from copper exports have kept Chile’s external trade balance solidly in the black for he past 4 years and the subsequent windfall have provided Chile with bulging coffers in the treasury. Official forecasts suggest that this may now be about to end, but it needs to be stressed that as long as copper prices stay in the region of the current level and absent a complete slump in demand, the trade balance should continue to provide a sound counter balance to the negative income account.

As is the case in most other emerging economies the Chilean central bank is strongly focused on an inflation rate currently running well above its 3% target (9.5% in July). With this in mind, it is reasonable to expect that the central bank will continue to raise to a policy rate of 9.5% before the end of 2008. Coupled with the recent suggestion by official advisors that the central bank abandon open market operations to manipulate the Peso, the hawkish position should benefit the Peso in H02 2008. One risk to this call would be a significant spike in risk aversion that could lead to an emerging economy wide capital flight.

An Orderly Slowdown Ahead

The Chilean economy continued to expand in Q1 albeit at a slightly lower pace than in 2007. GDP growth expanded 3 % on the year and 1.4% q-o-q where the latter figure translates into an annualized growth rate of 5.6%. Not many forecasters, official as well as commercial, expect this figure to hold however. Morgan Stanley recently revised its 2008 GDP estimate downwards from 4.3% to 3.8% whereas the central bank is more sanguine in their bid of 4.0 to 5.0% for 2008. Chile expanded 5% in 2007.

On the demand side the expansion in Q1 was largely driven by gross fixed capital formation. For 2008 the central bank is predicting investments to increase by 13% driven, to a great extent, by energy and mining related capex. Consumption however grew at an overall slower pace than 2007 and is not expected to top a 5% growth rate in 2008. As for government spending, the central predicts that the formal rule established in light of the recent copper bonanza (see below) will persist in 2008 where the public surplus is expected to clock in at 0.5% of GDP.

Despite the apparent solid performance figures signs are emerging to indicate the Chilean economy may be slowing. This possibility is hinted at in the recent central bank monetary report where a decidedly cautious tone is presented. The central bank ascribes a relatively high downside to the effects from incoming inflation pressures as well as negative hydrological conditions which are tantamount to the energy supply in Chile.

One sign that the economy may be entering a softer patch comes from industrial production figures where production fell in both April and May at -2.8% and -0.9% (m-o-m) respectively. If we turn to yearly figures, the recent months have been more volatile than the stable levels observed in 2006 and 2007 but the trend is inexorably one of decline. Over the first six months of 2008 industrial production averaged a 4.2% increase which compares to an average of 5.2% in the corresponding months of 2007.

Domestic demand as proxied by sales of consumer goods also shows signs of decline in growth rates. In the first half of 2008 sales averaged a monthly (y-o-y) growth rate of 4.2% which compares with 7.7% in H01 2007 and 5.0% in H02 2007. An educated guess suggests that domestic demand will grow in the region of 3.5% to 4% in 2008 which must be compared to a corresponding growth rate of 6.3% in 2007. Clearly, this does not signify a crash, but more so a moderate slowdown in line with global fundamentals. Morgan Stanley’s in-house Chile analyst Luis Arcantales also weighs in on the situation of the consumer. Arcantales notes three headwinds in the form of rising inflation, tightening credit standards, and a slower job creation. According to Arcantales the banking sector in Chile has acted swiftly, and in essence proactively, in the face of the global outlook where tighter credit standards seem certain to be a part of the equation. In the second quarter of 2008 44% of banks consequently reported that they have tightened credit standards. If we add the fact that the central bank of Chile is still in the midst of a hiking cycle, which so far as taken the rate to 7.75% from 5% in June 2007, it is clear that demand and supply for consumer credit is likely to fall further.

With respect to labour market dynamics employment continued to expand briskly in Q1 2008, but seems to have slown down somewhat in Q2. Out of an estimated 7.186.130 people in the labour force 6.583.130 were in employment which translates into an unemployment rate of 8.4% (603.000). In Q2 the number of people in employment furthermore decreased slightly 0.3%. Compared to Q2 2007 the unemployment rate increased 1.5% and compared to Q1 the corresponding figure was 0.4%.

This coupled with a hawkish central bank and a deteriorating credit environment for consumers suggests that Chile may be heading down a notch a two when it comes to top line economic growth.

Inflation is creeping up

As a part of the general slowdown in economic activity the lingering increase in inflation definitely seems to be the most pre-occupying threat from the point of view of policy makers and sell side research.

JPMorgan suggests that Chile may be set to enter a stagflationary phase as growth nudges below trend at the same time as inflation remains elevated. JPMorgan furthermore anticipates the central bank to move in strongly to counter the inflation trends which will further put pressure on Chile’s economy.

Unlike in other economies inflation pressures do not seem to come as quickly on the back of easing commodity pressures as first expected. In July, inflation rose to an annual rate of 9.5% and even though the central bank opted to raise interest rates 50 basis points on the 14th of August the real interest rate is still negative. This may not in itself be a solid policy gauge since, as we learned above, credit already seems to be tightening considerably due to restraints on the part of a proactive financial services sector. At this point, inflation forecasts for 2008 are hovering between 8-9% and with a formal target of 3% we can expect the central bank to continue with the rating cycle. The central – confident in its investment strategy, forecasts that inflation should fall towards its 3% target in Q2 2009.

We are reluctant to look this far ahead but concur that inflation is set to remain high for the rest of 2008. This, in turn, will in turn keep the central focused on inflation. It is thus perfectly possible that we see a central bank refi rate of around 9.5% before 2008 is out.

One important factor here is also the Peso where the central bank has recently been engaged in open market operations to stem the flow of appreciation against the USD and in fact to maintain what has been a steady depreciation since April.

Given the inflationary tendencies and their persistence advisors close to the central bank have explicitly suggested that such open market operations be abandoned due to the threat from inflation. Given the recent and new found strength of the US dollar it is difficult to say whether the Peso will be flattered too much by the central bank’s hawkish stance (against the USD that is). However, it is reasonable to expect we think that the Peso will appreciate moderately provided that the central bank decides to stop its open market operations. At the end of June the Peso marked a 10 year low against the Dollar, a value we feel should fall slightly in H02 given the continuing hawkish position by the central bank.

Copper, Copper Everywhere

Perhaps the most important aspect of the Chilean economy since the advent of the 21st century has been the extraordinary windfall from copper production and exports. According to most estimates Chile alone accounts for one third of the world’s copper production and in light of the relentless upward March of copper prices Chile has seen its goods trade surplus swell accordingly.

In formal terms, the so-called copper Bonanza began in 2004 and has continued un-abated up until this point. Given the recent decrease, across the board, in basic commodities the goods trade balance seems set to deteriorate but only slightly as far as goes 2008. In Q1 the goods balance stood at 6231 mill USD which is up considerably from the previous quarter. In Q2 and Q3 the goods balance is forecast [1] to take the value of 6555 and 6147 mill USD respectively where the trend is more important than the point forecast itself.

However, the external balance is not only about tangible goods.

Consequently, and while a positive trade balance is still keeping the overall current account in surplus, a negative income balance is beginning to pull the trend down. Add to this that the trade balance in 2008 looks set to be weaker than in 2007 the current account could very well swing into negative in 2009 which would be the first time in five years. In fact, the central bank is predicting the current account to swing into negative already in 2008. This seems a quite bearish forecast but much will depend on the rate of import growth which is the major determining factor in the forecast. As such, the central bank forecasts the goods balance to deteriorate to 17.000 mill USD in 2008 from 23.653 mill USD in 2007. Clearly, this would be at odds with the model deployed above but given its high degree of prediction error in terms of point forecasts, the central bank’s forecast should not be explicitly challenged at this point.

Much more important than the immediate outlook of the external books is, however, the way Chile has chosen to manage the recent years’ copper bonanza. One crucial aspect to note is then the extent to which Chile has maintained fiscal discipline in the face of the surging commodity boom. In numbers, Chile has consequently aimed at an annual fiscal surplus of 0.5%/GDP to act as a counterweight to the incoming copper revenues. In more traditional economic terms one could also see this as a proactive attempt to avoid that Chile fall under the yoke of a Dutch disease type correction.

So far, Chile has honed up to its intentions.

Between 1996 and 2006, Chile’s public balance averaged 1.5% of GDP a position much better than that held by its peers in East Asia and Latin America. From 2005 to 2007 the structural surplus as a percentage of GDP was 1% and is expected to 0.5% in 2008. However, the pure fiscal surplus, in 2008, as a percentage share of GDP stood at 8.1% which is quite extraordinary on any measure. In 2008 the corresponding figure is set to decline to 4.8% which still represents a solid cushion.

Apart from handing Chile the highest sovereign debt rating in Latin America it also prompted Luis Arcantales recently to dub Chile the real thing referring to the fact that Chile, unlike its Latin American peers, has chosen to build up a structural fiscal war chest rather than one of foreign FX reserves. Ultimately however and a in a context of global liquidity the bottom line remains much the same. Consequently, Chile’s treasury recently laid out a plan on how to construct an optimal global portfolio from which the copper windfall could be transferred into financial assets. Through the so-called Economic & Social Stabilization Fund (FEES), Chile plans to put a substantial amount of its savings into equities and corporate bonds. Thus, and quite in line with other sovereign investment vehicles (SWFs), so will Chile’s savings also be going for yield, even in a situation where the government is a net creditor with outstanding debt at about -11% of GDP.

Notes

[1] This is how our model performs in a post mortem perspective.

In general, the fit in terms of point forecasts is not that good, but the fitted trend is very close to the actual movements with a correlation coefficient of 0.92. From a standard model selection criteria point of view the model performs marginally better at predicting the trade balance than a random walk model although it is considerably better to predict the time series in changes. The model is consequently formally built upon variables in changes to correct for stationarity problems.

List of References

Arcantales, Luis: Morgan Stanley GEF - Can’t Beat the Real Thing! 18.03.2008
Arcantales, Luis: Morgan Stanley GEF – Dark Clouds for the Consumer 20.08.2008

Schröder the Disaggregator

Robert Amsterdam — Thu, 18 Sep 2008 16:06:46 +0000

To see an expert ply his trade is often a beautiful thing. But to watch Gerhard Schröder do what apparently he does best, which is to push Russian interests in the West in exchange for hundreds of thousands of euros, is an often revolting, stomach-churning disgrace. Shouldn't we expect higher moral conduct from our former heads of state? Somebody should really let the former chancellor of Germany know that he actually is probably doing more damage than good in representing Russia. Moscow deserves a more credible voice in Europe, and it's hard to believe anything this guy says even when he might have a point. Yesterday, for example, he gave a speech before a German-Russian business group in Dresden, extolling the virtues of uncritically aligning Germany's interests with Russia - the subtext of which was of course that the trans-Atlantic relationship should be abandoned or downgraded, and that Berlin's preferential relationship with Moscow over its loyalty to other EU members would help to disaggregate Europe. He was also there to pitch the war, and convince Germany that it's perfectly OK for Russia to invade sovereign nations absolutely no consultation with the international community. He told the audience in Dresden, "Europe should accept that Russia, just like any other country, must defend its security interests," that NATO's membership talks with Georgia and Ukraine "should be kept off the agenda," and that Europe shouldn't look to diversify energy supply because "Russia is reliable, stable and so close to Europe." To top it all off, he repeated the favorite Russian threat, that if Europe didn't bend over to Russia's energy demands, that they would take all this gas and oil and go the Chinese. Interestingly, the very next day Schröder hopped on a flight to Russia to report the results from his assignment to the Kremlin and his employer Vladimir Putin.

Energy Blast – Sept 18, 2008

Robert Amsterdam — Thu, 18 Sep 2008 07:30:32 +0000

President Dmitry Medvedev has called on security chiefs to establish a formal border in the Arctic, territory which he views as crucial to Russian energy security. Arms control advocates see the nuclear energy accord between the US and India as potentially damaging anti-proliferation efforts. Henry Kissinger writes on how the worldâ€™s biggest oil consumers might change the current dynamic of energy supply and demand. Britainâ€™s impending energy shortfall will leave it vulnerable to Russia, says one journalist. Gazprom and LUKoil have been fined for charging identical prices for gasoline and diesel. The International Energy Agency has warned that the world economy faces a recession if the price of oil stays above $90 a barrel. The US says it will take measures against companies it believes are assisting Iran with its nuclear program.

How to channel NZ savings into NZ infrastructure

Bernard Hickey — Mon, 04 Aug 2008 02:34:41 +0000

National Party leader John Key hit two hot buttons in his speech at the weekend when he promised to increase government borrowing by 2% of GDP to invest in infrastructure. First, he correctly pointed out that New Zealand needs to invest heavily in infrastructure to boost productivity. Second, he said the government needed to borrow to do it. The first hot [...]