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From: "G Stolwyk" <>
Date: Thu, 1 Feb 2001 12:57:21 +1300

The first paragraph of the article of Jan. 31 does not say that the Reserve Bank will raise interest rates.
It was used as an introduction to other matters.
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 trading partners.
Returns to foreigners investing in our bonds will increase as well due to currency translations. This in turn supports the currency.
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 rise.
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 markets!    
H: References to those risks can be found in statements from the Reserve Bank: < >
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 of drones!
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 misjudges.
G: And if you have the X factor, then you could be ahead of the market and make some splended investments!
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 about!
H: That is true. And they can be successful!
Changing the subject, I spotted at least three grammatical errors immediately after I printed my last article.
And this was after I checked the email a few times!
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 problems!!

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