The first paragraph of the article of Jan. 31
does not say that the Reserve Bank will raise interest
It was used as an introduction to
As the larger economies cut their interest
rates at about the same time-and we don't- then, if everything else remains the
same, our currency should strengthen to those of some of our major
Returns to foreigners investing in our bonds will
increase as well due to currency translations. This in turn supports the
G: As soon as there was talk about Australia
cutting their rates, the $NZ rose further in relation to the $A on the
understanding that NZ will not be able to cut theirs.
H:That effect will
be obscured over time should the government fail to hold
inflation. The market may then predict that interest rates will
G: Mind you, often there will be
a risk premium as the investor senses that the overall
risks to the NZ economy are higher.
Real and perceived risks will induce the NZ
investor to invest more in overseas
H: References to those risks can be found in
statements from the Reserve Bank: < www.rbnz.govt.nz >
The investor may care to trace the status of
our External and Internal deficits.
Other news eg.any increases in our
Invisible overseas payments, can also be interesting!
G: You would expect some MP's to refer to
these statistics from time to time!
H: Forget about them. If you tell them that a tree
is about to fall on them, most won't listen.
Others, including any government, may not be
keen to impart bad news.
G: We want quality rather than
quantity in the Beehive!
A friend of mine suggested that the mere mention of a hive makes him think
H: Summary of these two articles: A succesful
investor keeps in touch with those parameters which drive the markets
and ultimately affect his investments.
The market likes to predict any outcome and act
before such an event. Sometimes, the market
G: And if you have the X factor, then you
could be ahead of the market and make some splended
However, most of us will continue to invest as we
see fit; many don't have the time to study all of the things we talked
H: That is true. And they can
Changing the subject, I spotted at least three
grammatical errors immediately after I printed my last
And this was after I checked the email a few
How to improve on this?
G: It could be that the ' Arial' print is
more difficult to comprehend or that you work too late. Perhaps, the glare from
the screen causes problems. I advise you to keep the article in the
draft stage and check it the next day.
Better still, don't write and you won't have these