Forum Archive Index - December 2000

["Talacek, Philip " <pjt57@elec.canterbury.ac.nz>]

Quite to the contrary, given that NZ is a long haul destination for most,
the greatest factor determining the attractiveness of it as a destination is
the airfares.  A weak NZ dollar is only good for NZ if we able to fool
ourselves that because we are getting paid more $NZ we are wealthier.  In
the long run a weak $NZ just means that everything (and I mean every thing
as just about every thing can be exported) is more expensive.  Those who
fail to realise this in the short run will eventually find out that their
purchasing power has been eroded and they failed to demand appropriate
compensation.  NZ will be better off when we start producing goods that are
of higher value in all currencies.  In the same way inflation only creates
illusionary wealth which in fact has large negative implications for our
economy (based on the risk those lending money face, and the higher premium
they demand), a sudden drop in currency value means we are all poorer.  As
an example in the 70s one South African Rand purchased $3US (gold peaked at
about $800US an ounce in 1980).  Today a South African  Rand Purchases about
$0.135US.  Now those South Africans are no richer for the fact, in fact they
can't afford to leave with out giving up everything.  A low dollar is not
good for NZ it is just the world telling us they have no confidence in our
economy and are not willing to risk holding our currency as there is little
of value we are producing that they might like to buy, and as such in a
years time they suspect it will be worth less.

Phil T
> -----Original Message-----
> From: hugh webber [SMTP:hugh.webber@clear.net.nz]
> Sent: Sunday, 10 December 2000 20:01
> To:   sharechat@sharechat.co.nz
> Subject:      Re: [sharechat] 2001 - Airlines
> 
> but the passenger arrivals won't keep climbing if the NZ dollar keeps
> climbing will they?
> Vote early and often for a low NZ $.
> 
> ----------
> > From: Jeremy <jeremy@electrosilk.net>
> > To: sharechat@sharechat.co.nz
> > Subject: Re: [sharechat] 2001 - Airlines
> > Date: Monday, 11 December 2000 17:57
> > 
> > It may be a coincidence, but both Air NZ (AIRVB) and Qantas have shown
> quite
> > healthy price increases recently.
> > 
> > They both have external factors operating on them, but both turned up
> > shortly after the dollar(s) started climbing again.
> > 
> > To support this, there is a recent news item indicating NZ visitor
> arrivals
> > will grow by 47% by 2006
> > 
> > It makes good sense that with increasing passenger numbers and lower
> costs,
> > airlines will do well in the near future.
> > 
> > Jeremy
> > 
> > 
> >
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