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Herald on Super

Yesterday's Herald editorial announces a great change in individual attitudes towards Super and gets it precisely wrong.

People love their own polls don't they? The Herald has found that 60 odd percent of people are worried that they are not saving enough for their retirement. Furthermore, that a reasonable number would accept compulsion. They then go on to worry that in spite of this only 25% will take up KiwiSaver.

I could have saved them the money. These answers are correct and predictable - and imply absolutely no conflict. Because behaviour is a funny thing. Yet I am willing to bet that any of you reading this could have accurately predicted the answers. Let me give you an example:

  • Do you think most New Zealanders could do with losing a little weight?    "Yep!"
  • Come to think of it, could you do with losing a little weight?   "Okay, a few mince pies still with me"
  • Do you intend to start a diet today?  "Er, really?...like right now? but we're going out tonight"
  • What about if we had a personal trainer come and shame you and all your neighbours into going for a run tomorrow morning at 6?     "Oh... well, alright then."

If we all had to, as th Herald points out, is a powerful motivator. It's why big Japanese firms can get their people doing calisthenics. Not us? If you are suffering from the 'oh but we're different from the master race of the co-prosperity sphere' type of attitude - bear in mind I recently met someone who worked for a major  bank who was asked to mime "I am sorry for being late for a meeting" with his buttocks - and rather than tell them to stuff their job - he actually did!

Pretty much the same answers would have been given in 1997 as well. So no actual change in attitude - an no great shift in the mind of the electorate.

What is different today is the juicy Cullen fund, a huge surplus, and the idea that us poor bludgeoned voters might get some of our tax money back somehow (other than in subsidies for artists, pledge cards, and superyachts). This is what gives compulsory super some fresh appeal - that maybe if the money were in an account with my name on, held somewhere other than with the Government then it might be safe from their sticky fingers.

Hmmm, and what do you think?

Funding NZ Super

It's amazing what strange ideas you find when you go looking for them. Now, how about this one? A blooger that goes by the monicker "Insolent Prick" reckons we should stick the SOEs in the super fund and let them decide what to keep and what to sell. Of course the only problem is that they sem only too happy to bend to event very modest amounts of political pressure (as in the recent cases of recent divestments). Anyway - it does make interesting reading.

Council deters construction

Auckland City Council is killing off apartment construction in the central city - whatever you might think of them, these are affordable housing units...

Robert Holden of Conrad Properties said steep new development contributions proposed by Auckland City had virtually killed the market. He had shelved a 200-unit block due an extra $7 million council charges.

From July 1, Holden said developers would pay $40,000 a unit in development levies where land is $3000/sq m and $80,000 a unit where land was $10,000/sq m as on Queen St.

Previously, he was paying only around $6000 in development contributions. Units only fetched an average $250,000 each so it was totally uneconomic to build under the new rules, he said.

From the Herald.

Fiddling with the money

The landmine makers and the whalers are gone - link. I don't know whether provoking more debate about this is sensible or not (see musings on 16 February below), after all, it could get worse.

Having said that, I did just see a press release that says ethical investing pays off - but don't they always. I mean we know that Enron style ethics get you nowhere, and the types of cash only businesses that involve surreptitious charter flights across the caribbean are also out, but in between there is a wide, wonderful country, and it should really just be about the money.

Your Wealth...and where it is

So, where is your wealth?

I remember being part of a group that was asked this question. I was one of only two - out of about twelve - who actually had money invested in products offered by the company we represented. Mine were in, of course, in commission free versions of such products.

Moving right along from the momentary embarrasment caused by this terrible breach of etiquette on the part of the facilitator that day, I venture to ask you a similar set of questions:

How much of your money is...
offshore versus NZ invested?
in direct investments versus managed investments?
in property, equities, bonds, and cash?

How do you feel about the split?