The partial sale of a number of Government owned commercial assets would be a better way for the Crown to raise new funds instead of directing the New Zealand Superannuation Fund to invest a higher percentage of its money in the domestic economy.

As at June 30 the New Zealand Government had total assets of $200.8 billion of which $14.8 billion was represented by the Super Fund. Thus only $12 billion or 6% of the total Crown’s assets were held offshore because most of the non-Super Fund investments are in the New Zealand.

The Super Fund was established to help partly fund the country’s escalating national superannuation bill. It also gives the Government the opportunity to diversify its asset base, particularly from a geographical point of view.

In addition offshore investments generate overseas earnings. These have a positive impact on the country’s bourgeoning balance of payments or current account deficit.

The preferred

A post-script to my post earlier in the week about being realistic over a free trade agreement with America. I pointed out the aggression and venality of US farmers when it comes to ‘free trade’. I suggested the lobbyists were powerful and would try to block access to any significant exports to America.

Here was the initial response from the National Milk Producers Federation. It called for the full exclusion of New Zealand’s dairy products from the P4 trade agreement. Not just a few extra tariffs or quotas. Full exclusion. I’ll let them hang themselves below.

“The real change as a result of a so-called Trans-Pacific trade agreement between these nations and the U.S. would be to throw open American markets to one large multinational company that works under the auspices of the New Zealand government. New Zealand is the world’s largest dairy exporter, and

We continue to have a cautious view on the global economic and market outlook as:

- the global housing crisis has still not bottomed - the banking sector is still going through a significant deleveraging process - the upcoming corporate earnings result season is likely to be poor - interest rates have more upside than downside potential (other than in New Zealand) due to rising inflation pressures.

For the US economy and sharemarket to make a substantial and sustainable recovery the US residential housing market must start to improve markedly. The good news is an adjustment process is under way with new home sales and building levels down dramatically. This will eventually lead to lower US housing inventory levels. The bad news is that this process will take some time to conclude. In the meantime there are increasing numbers of foreclosures adding to housing inventory levels.

The deleveraging of the US financial system