Where are the policies?

By DAVID HARGREAVES - BusinessDay.co.nz | Monday, 06 October 2008

The country's politicians have been "appallingly silent" about what policies they intend to promote to help New Zealand recover from the global credit crisis, NZX chief executive Mark Weldon said today.

He told Radio New Zealand's Morning Report that he expected some pressure would be brought to bear on "both sides of the political spectrum" to explain policies on the current situation.

"...Look if things have changed, if credit is no longer cheaply available, if the dairy sector's at risk and the housing market's falling - what are your policies that actually are going to allow the productive sector to help New Zealand earn its way out of this?

"...The debate has been appallingly silent actually on what these guys on both sides are going to do to address these changed conditions."

Weldon expected the reaction of the New Zealand market to the passing of the US$700 billion bailout package during the weekend would be muted.

"I would expect the volatility here to be lower than in the US simply because our direct exposure to the eye of the storm is a lot less and our companies are a lot less leveraged." He said the signs were clear from overseas that the global property bubble "really is over".

He believed that some discretionary money in New Zealand - though there was less of it about - might be put into the sharemarket in "defensive stocks".

New Zealand's financial system was a "big importer of capital" from overseas and because of the global crisis credit was now being rationed.

"Clearly the property market is the place that New Zealand banks will be shying away from and that will only accelerate the falls in the property market."