February 15, 2026 • 41 mins
We've started to see spots of what looks to be recovery in our economy over recent months.
It's not consistent, but it's frequent enough to give us some hope for the year to come.
Westpac is picking a whole lot of OCR hikes from the end of this year, and other forecasts seem to set a similar scene - a better economy is coming, and rates will have to reflect that when the time comes.
LISTEN ABOVE
See omnystudio.com/listener for privacy information.
Listen
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:05):
You're listening to the Weekend Collective podcast from news Talk, said.
Speaker 2 (00:09):
B oh, yes, welcome back. This is the Weekend Collective.
(00:46):
And by the way, if you've missed any of the
previous hours had a fans fascinating conversation with Matt Doosey
and Bok map around a bunch of things, you can go.
It's just after six flight you go and check out
the podcast at iHeartRadio or news Talk, said b But
I'm Tim Beveridge. We Want Your Cause on eight hundred
and eighty and eighty of course and text on nine
two nine two. By the way, that music was chosen
(01:07):
by my guest who is actually joining me in the
studio today and he is, well, he's Shane Solly of
Harbor Asset Management, and his choice of music to Shane, Hello,
how are you? Who is that?
Speaker 3 (01:21):
Is that? What's queen? Queen's the Stone Age?
Speaker 2 (01:24):
Yeah, the Ocean. I sat by the ocean, my producer,
it's it's it's it's a pan generational song. Obviously, because
she said, I think I've just found another song from
a playlist, So there's a win.
Speaker 3 (01:35):
I take that.
Speaker 2 (01:36):
Anyway, Look, we want your cause and look we've started
to see spots of what looks to be the recovery
and the economy. But it's not consistent, but it's frequent
enough to give us maybe some hope depending on who
you talk to. Of course, if you took the opposition,
it's all disastrous. Talked to some economists, they're like, well,
it doesn't look great, but we're optimistic. Then you've got
Westpac who's picking a lot of o c R hikes
from the end of this year. Another forecasts said a
(01:57):
similar scene. A better economy is coming. Rates will have
to reflect that. Or maybe we've got to get on
top of the old inflation which the numbers went so great.
But have you seen signs of economic recovery? We want
to know what you think on one hundred eighty ten
eighty text nine two nine two. But as I say,
Shane is here to talk about that and many other things.
He's a director, portfolio manager, research analyst at Harbor Asset
(02:21):
Management and here we are smart money. Shane. It is
good to see you.
Speaker 3 (02:28):
By the way, then, hey.
Speaker 2 (02:29):
Now that the question is going to ask you has
suddenly gone out of my head. But that that's the
thing that I was surprised that were you surprised with
Westpax predictions.
Speaker 3 (02:39):
Yeah. Look, I think what we're seeing at the moment
is the all the bank economists resetting there. So we've
seen a few of them come out with higher numbers,
particularly for inflation and where they think that's going to
lead to for the Reserve Bank official cash rat It's
really challenging being a bank economist. They've got lots of
different pressure points. But what we're at at the moment,
this this choppy recovery and economy doesn't really help them.
(03:03):
So parts of the economy are actually quite strong, of
Homon Canterbury or Otaga or South and pretty good.
Speaker 2 (03:09):
Canterbory is really smug right now, aren't they? You see
all christs. It's where it's at fair enough. Everybody has
been through a lot.
Speaker 3 (03:17):
Yeah, totally, And I think that's that's the benefit of
having a diverse economy in New Zealand. We forget that
that when one parts the economy is going, other parts aren't.
So you know, I think when we come back to
inflation per se, that's a big challenge. This week, we've
obviously got the Razzero Bank of New Zealand coming out
with official rate discussion on Thursday, and the markets are
(03:37):
not picking any hikes, right, so nothing, But if we
go forward a year, there's a whole one percent. We
get up to three percent from two twenty five. Now
this comes back to where the bank economists and others
are seeing inflation being sticky. Sticky is not going down
as fast we like. So we all know rates, insurance,
those sort of things hard to keep going down. Insurance
(03:59):
has stopped going up. That's a good start. The rates
is about a function of the interest rates, where if
the councilors have to pay for more for interest rates,
they pass it on to you.
Speaker 2 (04:10):
And I actually the rates part of the inflation equation.
Speaker 3 (04:17):
Yep, because there seems there's.
Speaker 2 (04:20):
Sort of something that I don't know how much should
that they be incorporated into the reserve banks consideration around
the cash rate because rates going up is not it's
different to prices going up in a way, isn't it.
I mean rates, it's a tax, it's a form of tax,
and it's something that is in itself surely a repressing
(04:41):
thing when it comes to inflation. And I'm not even
an economist, but that seems to intuitively make Iman banged
on about getting a c or a C minus at
university for stage one. But it's a pass, but it's
seas get degrees. But it is a tax and it
is anti inflation. Rates are anti inflationary, So why should
they be? Is that a pushback against worrying about it inflation?
(05:05):
If rates are, I mean, how much of a player
are they in the inflation figures?
Speaker 3 (05:09):
Yeah? Look, I don't know the exact numbers, to be
honest with a timbo. They're a component and they're the
piece that have been pushing up. So it's a bundle
of costs that we as consumers have to incurse. So
consumer price inflation is what CPI sands for. So it's
a tough one.
Speaker 2 (05:25):
You know.
Speaker 3 (05:25):
I've got the new governor, Anna Remen's come in. She's
been come across as being a little bit more hawkish.
I'm watching this.
Speaker 2 (05:34):
Hawkish with a smiley face.
Speaker 3 (05:35):
Correct.
Speaker 2 (05:37):
It's funny, isn't it that when you say hawkish, you
sort of think she doesn't look hawkish to me. Then
you think, hang on a minute, we're talking. It's an
interesting because she's very personable and yet hawkish.
Speaker 3 (05:46):
Yeah, totally. And I think so she's got this situation
where the economy is, as we're talking about before, just
showing signs of lifting off. It's a bit inconsistent. Well,
she's still got the tail of an inflation pulse that
she's dealing with. So in an ideal world, we can
have both. We can have a recovery with inflation blowing
(06:06):
out and that's it. That's it. That's something we don't want.
Inflation is not good for consumers, it's not good for
how we all can live our lives. So it is
an important thing for her to focus on. So I think,
you know, we come back this week, she's probably going
to talk about, well, you know, I'm seeing I'm seeing
the stickiness, and I'm sort of thinking about maybe could
(06:27):
be perhaps lifting rapes. Meanwhile, capital markets, investment markets have
already got quite a chunk priced in now. Yeah, so yeah,
we'll see. But it's unemployment is unfortunately not going down
in a hurry, right. That's a lagging indicator. This recovery
and activity is to really flow through, so hard to
really crank up rates when unemployment is palibate.
Speaker 2 (06:50):
It it's like the rhetoric around look, you know, they're god,
I love the cliches around economics, you know, the green shoots.
There's something that you hear all the time. You can
probably make it sound itself sound quite informed by just
recycling I could by recycling a few cliches, but actually
just on Anna Breman. So she's hawkish, but of course
it's a monetary policy committee that sets it's all these things.
(07:11):
How much influence what's the take of you people you
talk to in terms of her influence on the final
decisions that are going to be made around the cash rate?
Speaker 3 (07:20):
I think there's definitely. As you say, it's a committee,
so it is not one person making decision that's really important.
There's lots of different views. Similar to the US, where
we have a front person and they do have to
carry the decision.
Speaker 2 (07:33):
We can they have to walk the walk until they
resign and just disappear. Sorry, we'll move on mentioning any
names Andrean or whoops, carry on. Sorry, that's good.
Speaker 3 (07:46):
And so I think you know she has there's some
changes there as well. And so she's dealing with a
group that are certainly cautious and well versed in managing
this process. They've all got good backdrops for doing it.
So she's got a good group to work where it's
probably the best we'll put it.
Speaker 2 (08:04):
So where are we at in terms of your views?
I mean, you guys are at harbor a set. You
are dealing with making investments and on behalf of people
and making you know, doing the analysis. I mean you've
got a lot on your plate, just even in your
job description research analyst, portfolio manager and director. But okay,
so guys, within your industry and your your business, what
(08:25):
is the view of whether we are seeing either a
strong economic recovery or the potential for it? What is
your view of that?
Speaker 3 (08:34):
Yeah, look, it's economic recoveries are never a straight line.
Quite often, it's a bit like you when you're watching
a rocket take off. It looks slow and there's not
much going on, and then it gets a bit of
momentum and.
Speaker 2 (08:46):
Where we go.
Speaker 3 (08:47):
Yeah. Correct, And so when we look at the New
Zealand economy, we are seeing improving lead indicators. There is
definitely an improving trend. Last week we had a manufacturing
index out lead indicator. A purchasing manager in Nex's asking people,
what do you think you might do? And it was
fifty five point two, which is actually above fifty. Menus
asking who what the manufacturing industry.
Speaker 2 (09:10):
Okay, so in terms of how much you are investing in.
Speaker 3 (09:13):
Are you positive about the future, are you going to
hire more people, are you going to carry more inmentary?
Do you need to expand? So fifty five above fifty
menus are expanding. Below fifty minutes, you're shrinking.
Speaker 2 (09:24):
Yeah, okay, so that's good.
Speaker 3 (09:26):
Yeah, but it was it was down almost one percent
from the previous reading. It's still positive, but people are
going to some of the large and error stuff. Yeah, definitely,
you know, do you ask the question slightly different, but
it is indicative of the economy. It's two steps forward, okay,
one step stomach.
Speaker 2 (09:42):
We'll give that a slight tech then yeah, yeah, okay, yeah,
what else?
Speaker 3 (09:47):
And so we're seeing other indicative readings such as like
the A Z Truckometer. It's quite an interesting piece of
research they do where they literally manage a measure the
truck volumes in different.
Speaker 2 (09:59):
Parts of the country, volumes and distances exactly.
Speaker 3 (10:01):
Yeah, so we all have to pay our rucks and
a road user charge and they've got a good trek
when that's showing some recovery too. Again, come back, different
parts of their country are going really well. Auckland's still
not well in's and not things like construction industry slowing
in parts, so it's we're going through that sort of
(10:24):
trough getting better. So yeah, look that the net number
is improving.
Speaker 2 (10:29):
Can I ask a trivial question about the trichrometer? Would
it show a positive gain simply because there's been some
landslips and trucks are having to drive avoid that gorge
and drive another ten hours or something. Yeah, that would
be misleading, wouldn't it.
Speaker 3 (10:43):
It would be And it's a fear point that it
does pick up that extra I've had to go around,
I've had to do this, but you still do it
credits activity for sure.
Speaker 2 (10:52):
Yeah.
Speaker 3 (10:52):
So you've got to be careful about all these data points, right,
one data point not enough. It's got to be a composite.
Speaker 2 (10:59):
Oh I'm thinking. I was trying to think, what's the
international example, But it's the McDonald's in Decks or something.
Isn't there that around the world people look at the
price of a big mac. I don't know if that
has any time for our own situation, but let's stick
with a New Zealand at the moment. So we've got
the truchometer we've got agriculture. Where's that apt?
Speaker 3 (11:18):
Agriculture has been really strong, quite interesting though the EXCT
a pretty canny. Folks generally being careful about how they're
spending their money. There's a little bit of Obviously, we've
got a potentially quite a large payout for the dairy
industry from Fonterra threeund fifty thousand dollars plus per farm.
And does that happen in a couple of months time,
(11:39):
so you know we're not far away.
Speaker 2 (11:41):
God, the government must be licking their lips at the
prospect of this because it's gonna it surely will give
the appearance. I know a lot of people who use
it to pay down debt and a whole lot of things.
But that's a truckload of money coming into the economy. Ye,
what's your take on that?
Speaker 3 (11:56):
Yeah, I think it's a good pulse, right, and it'll
put some stimulus into parts of the economy. But you're right,
I think you know, we've already seen a lot of
farmers reduced it. There's a small number of farmers with
quite a lot of debt and they will probably use
the vast majority there. Others will start to think about, hey,
we need to spend a bit more money on lift
some capital investment on the farm, putt a bit more
fertilizer down, doing some works, and maybe you know, some
(12:21):
of them might spend a little bit of money on
just having a good time, which after working very hard,
they should.
Speaker 2 (12:26):
Do either a trip overseas or they're going to go
crazy at field Days.
Speaker 3 (12:30):
Actually when is it?
Speaker 2 (12:32):
Sorry, I'm going to ask a dumb question. You might
not know the data exactly, but so field days is
middle of the year. I think it's in June, and
if the payment's coming out in a couple of months,
so what are we going. I don't want to get
over the top with this, but man Field Days supplies
must be just thinking.
Speaker 4 (12:50):
This could be the best ever, wouldn't It will literally
be a field day for them. It will be Yeah, curiously,
just with one D. I had an argument with somebody
who actually is quite closely connected with field Days. I
was about to ask them, it's well, why is it
not two days?
Speaker 2 (13:05):
Two d's anyway, the South Island also, they're a bit
smug there, so that's a strong indicator though for us
that's South Island doing well. Is that just ag or
is it other things I.
Speaker 3 (13:14):
Think in certainly Canterbury, as you touched on, it has
gone through tough times. It's seen a recovery some of
that investment that's been made and lifting the productivity rebuilding
is actually starting to lift good migration too. By the way,
you're getting net migration into the south of the South Okland,
you know, not just from Auckland, but all from other
(13:35):
parts of the country and globally, so that's helping. We had
some migration stats last week terms that were sort of
net positive with less outbound, so there's a little bit
of you know.
Speaker 2 (13:46):
Still lots of outbound, but it was three thousand fewer
kiwis leaving.
Speaker 3 (13:51):
It's right, it's the start of a trend, perhaps.
Speaker 2 (13:54):
Something that a politician could make a headline out of,
but something that Harberra Asset Management will go, well, yeah, okay, good,
it's not getting worse.
Speaker 3 (14:04):
It's right. It's not enough to change your thinking on
a bunch of things.
Speaker 2 (14:07):
Actually, just on the migration thing. This is where I
just sort of think the amount of stuff you have
to get your head around, you guys, but migration does.
Is there a difference in the way we view the
stimulus of migration when it comes to New Zealanders staying
leaving versus non New Zealanders coming in or leaving.
Speaker 3 (14:28):
Yeah, I think ultimately it's about productivity, right. We want
people that are lifting the return per input. That's ultimately
what we're looking for an economy. I don't think you
can say a news unders staying is any better or
worse than.
Speaker 2 (14:40):
I was just wondering if there's a dollar amount that
attached to Like, if we had one hundred thousand people
coming in who were non New Zealanders, what would be going. Well,
there's a bunch of money attached to that, versus someone
who's just decided up to their ten year oe, I'm
coming home to stay with mum and dad.
Speaker 3 (14:52):
Yeah. Well, look if they're coming back out of ten
years happy to they're bringing some good skills back with him,
So that's there would be great. Everybody want to be
a one of Then.
Speaker 2 (15:00):
Hey, look we're going to say a quick moment. I'm
with Shane Soli, he's director of Portfolio Manager Research on
Harbor Asset Management, and we're talking about well money and
at the moment, the New Zealand economy, economy, the recovery,
what does it look like what's your take on it?
But also what does it mean for share market? New
Zealand share market investors might dig into that and other questions.
(15:20):
Got lots to get through with Shane Soli, but you
can jump the queue or button by giving us a
call on eight hundred and eighty ten eighty or text
nine two nine two. This is news Talks be smart money.
It's twenty two past five. Are you worried about funding
a comfortable retirement? Well you're not alone. The cost of
living crisis is hitting home for a lot of people,
(15:40):
so it's no surprise people are looking for ways to
make the most of their savings and get a little
bit more income to supplement their New Zealand super One
interesting solution is to invest in an income fund like
the Harbor Income Fund. It works by holding a mix
of interest paying securities and shares that have been designed
to generate a steady and sustainable income no matter the market.
(16:01):
The Harbor Income Fund is actively managed and currently it
pays a distribution of four point five percent per annum
after fees and taxes paid out in monthly installments. To
find out more about Harbor's Income Fund, just head to
their website. Or speak with your financial advisor. This is
not intended as personalized advice. The product Disclosure Statement for
Harbor Investment Funds issued by Harbor Asset Management is available
(16:25):
at harbor Asset dot co dot Nz.
Speaker 1 (16:30):
Your Weekend, Your Way, The Weekend Collective with Tim Beverage
News Talk zeb, Yes.
Speaker 2 (16:37):
News Talk SEB and my guest today is from Harbor
Asset Management. He's direct portfolio manager and research analyst. Shane Solely.
I do read the whole shebanga. I should probably just
say he's from Harbor Asset and he knows what he's
talking about. Hey Shane, now where are we at with?
I guess with New Zealand stocks, with the sheer market.
So we've got some good news stories which we've heard about.
(17:00):
What is New Zealand what's the nzs.
Speaker 3 (17:03):
Z fifty that's the one that's the benchmark.
Speaker 2 (17:06):
Well, thank you for that. What's that looking like?
Speaker 3 (17:08):
Well, look, to be really honest with you, last year
we had a bit of a recovery in the New
Zealand sher market, but it actually wasn't the most stunning
performer over the full year is up just out of
three and a bit percent. What we saw in the
second half of the year was quite a strong performance
seven and a half percent, and that's about investors anticipating
the economic recovery we were just talking about before, and
(17:29):
it was quite led by a lot of the mid
small capitalization companies that are more sensitive to economic activity.
But what we're seeing so far this year, we're down
about two percent. What we're looking for, tim is we're
coming into a profit reporting season for the December period.
So every six months, companies have to formally report how
(17:50):
their profits are performing, how their balance sheet looks, how
the business has been going, and so we're coming into
what's called the December profit reporting in February. Unfortunately, it's
a bit of a confusion there, but it's for the
December period, and so what we're looking for is whether
that reporting is and we'll give us a bit of
an infliction, whether it's enough to keep us, hey, look,
this momentum and earning is continue or not, or we
(18:14):
are sort of on the way not quite thee it's
about thirty eight companies, so out of that fifty and
the benchmark thirty eight or reporting, quite a wide range
of different companies reporting, so we'll get some insight as
to how the economy locally and globally is impacting on
the businesses, how they're managing costs, some of the productivity changes.
(18:36):
After over the last three years, which have been a
bit tough, companies have been putting major changes in their
businesses through whether that flows through the profitability. So, yeah,
it's going to be a really important period of time.
The next two weeks is going to be hyper busy
for us.
Speaker 2 (18:47):
Do people like you do you get surprised us with
profit announcements? And how much of this stuff can you
get wind of? Because there's a serious information and obviously
there's the whole lot of rules around confidentiality, But are
there winds that you can sort of get a sense
of where things are going just by the fact that
(19:08):
you've been following the fortunes of these companies.
Speaker 3 (19:11):
Yeah, Look, you're right. Markets do get surprises because it's
about expectations. It's about you and I having different perspectives,
different information. The work that we've done to land at
whether we're invested so publicly available information is the key
in New Zealand, that's what drives those expectations. But it's
(19:31):
up to me and the team I work with. I
work with a really great team of six people who
work their tails off to do discover understand how certain
businesses perform in different environments. And so yeah, we get
out there and scoot around and talk to as many
people as we can. But no, there's nothing that's unusual.
There's nothing those days. I can tell you. I'm truly gone.
Speaker 2 (19:54):
I don't mean it from the point of view of
anything dodgy, but it's just because, as you say, there's
so much public information. You can look at an industry,
well hear it. You might have heard about certain contracts
have been awarded, or turnovers or whatever. I mean, it
still doesn't tell you exactly how the profit loss sits.
Speaker 3 (20:10):
You just now do that's exactly right. You can win
something and you go, okay, is that good or bad?
Am I making money out of this? Or is it
actually a drag on the business long term?
Speaker 2 (20:17):
Yeah, And if you knew something a bit more about
just how the business is being run, that would would
help investors make decisions on that. And that's the science
of it all, isn't it. I guess that's the juice
that gets you guys out of bed every morning.
Speaker 3 (20:28):
Yeah, you bear the excitement at the moment, of course,
is this increasing use of artificial intelligence of AI, which
is really dragging in vast and information processing them really
fast and coming up with conclusions that may or may
not be correct, but they're driving markets.
Speaker 2 (20:46):
Actually, how is now we're going to talk about AI,
but in terms of the technology of what's available to
organizations like harbor resset management, how much grunt work does
it save you from doing? Because for most people who
casually use AILL know that you have to check it
double you know, you sort of have to get it
(21:07):
to double check its homework, and sometimes you have to
call it out. I've had that with chat GPT on
certain things with the research and I'll say I'd like
you to check that again because I've noticed this, and
it goes, oh, thanks for catching me up on that, Tim,
You're right to call me out for that. So my
trust is not you know, they're one hundred percent. Where
are you guys with the tool that provides for you?
Speaker 3 (21:26):
Yeah, look, I think it's it is just that it's
a tool. It does tend to create its own fills
the gaps, right, So it's because it's a probability based tool.
If it doesn't have the information. It'll pretend it does,
so you've got to be really careful. I'm going to
call out a friend of mine, Frank, who's a GP
up in Northland. He's an amazing guy. It does a
great job. They're using this stay of day for engaging
(21:51):
note doing notes and it's really improved his day. Right,
So taking a lot of time out of this day
formats things and gives them some edited notes. That's productivity.
That is really helpful. We are using a bunch of
different AI tools, but they're to support They speed things up.
Speaker 2 (22:08):
They don't replace with data analysis. It would be imagine
pretty amazing, wouldn't it would Does it still like to
fill in the gaps?
Speaker 3 (22:15):
You've got to make sure you're not letting it fill
in too many gaps. You've got to control it. It's
the same with having discussion about when you're talking to
somebody about our job. You've got to be very prescriptive
about it. It's you know, like I said, there's a
wide range of industries this is touching on, but this
so certainly we're using it, we're testing it out. It's
not driving what we do. It's part of our day
(22:37):
to day.
Speaker 2 (22:38):
Yeah, well, okay, so because they've been, there's been AI
has been in the news from a point of view
of investing over the last one in a week, a
few weeks or months weeks, should I say, And there's
been some ups and downs and investment markets. What's going
on there with people getting excited or otherwise.
Speaker 3 (22:55):
Yeah, what we've seen in the last four five weeks
is the release of a bunch of different models from
companies such as Open Ai Anthropic that have sort of
raised this question about can I use artificial intelligence to
replace my existing software solutions? And a good example to
use is perhaps zero. The accounting software is a service
(23:17):
business and we haven't seen it yet, but there is
Could I use AI to replace or internalize that service?
Speaker 2 (23:26):
Can I like for me? Can I get AI GST?
In correct, it's accountant, it's use zero and all that
sort of thing. That's right.
Speaker 3 (23:34):
So we've seen a model release for legal, a model
released for the wealth management insurance and last week freight
forwarding industries. Now, whether these models actually deliver the trust
and the quality that we all need to run our
businesses with is yet to be proven, but the share
(23:56):
market has gone, oh, this is a disruption risk. So companies,
share prices have been dropping twenty thirty zero zero is
down thirty five percent wow year today.
Speaker 2 (24:08):
And that's simply because of a what if.
Speaker 3 (24:10):
It's a what if. They are still pumping out cash,
growing their their user base, growing their monthly fees they
collect from their users. So it's just a disruption, and
I think, you know, I don't see just in the
meaning way. It's actually something that we've got to think of.
So we've got to We've got an area of the
(24:31):
of software that has been quite highly priced and because
people don't know that, industry disrupt the valuations if worn away.
Speaker 2 (24:41):
That's interesting because I wonder with zero, I mean zero
must be working on their own AI sort of thing
so they can meet that challenge. I would imagine that's
going on right now. Have they? Now? What have they
got going on there? Do you know? Only about that?
Speaker 3 (24:53):
They've got an offering called just us zero Jacks and
it is very effective. And you've just you've hirled something
that we think that the market is not paying attention to.
That some of these key service providers have actually got
their own AI solutions that could really accelerate their businesses.
(25:15):
So we're in that point where the market is unsure.
So it's kind of like self first, ask questions later,
it's up to these businesses deliver it.
Speaker 2 (25:22):
This sounds like people making how much of this is
based on really good, hard evidence in terms of what
a I can do versus just people's sentiment, and like
all AI is amazing. So therefore Zero is screwed.
Speaker 3 (25:34):
Yeah, there's not enough evidence to disprove it, and so
it's until that's the case, I can't disprove here. And
so I think what we're going to see is, as
you say, the company is using ALA themselves to reduce
their costs, improve their productivity, and so they'll have to
show us by retaining clients, growing clients, delivering better revenues,
(25:56):
delivering better profits. So every six months, as to say,
we get a snapshot.
Speaker 2 (26:00):
Because it's difficult, it's a difficult game for you to play.
It's the sort of thing where individual investors might their
own recons and go, hey, get on the blow. Hey look,
I want you to just stop investing and companies like
Zero and get into you know, check GPT and every
other AI company that's going. I mean, how are these
stocks of their AI companies? What's what? What is how's
that playing out for investors?
Speaker 3 (26:20):
Yeah, look, I think that certainly the MAG seven you
might have talked about before is not performing as well
as it has in the past. But because it's the
MAG seven, this is things like alphabet Amazon seven correct copyright. Yeah, yeah, yeah,
it's great, isn't it. So you know, we're certainly seeing
those businesses. Some are doing better, others lists so right,
(26:43):
So Oracle, which is obviously one of the global giants
in this space, it's been under pressure and one of
the things we're seeing is a lot of debt issuance
in this space, so that is undoubtedly putting a little
bit of pressure on that. There's an argument about software
eats the world and AI eats software. The AI businesses
(27:05):
need massive amounts of capital to support the growth, to
feed the beast of AI. So Morgan Stanley is estimating
that this year alone, the US hyperscalis, this is the
metas and the Googles will raise four hundred b in
US to fund the build out. Gosh, it is huge.
Speaker 2 (27:26):
Because there are the other things like that's very hungry
for resource when it comes to the power that drives AI,
are you I mean, this is just maybe it's focusing
too much on this issue. But is there a danger
with that that you know of because there's the sort
of this non sort of military or maybe potentially you know,
(27:49):
the battle for minerals and the minerals to provide the
resources to host all these massive data centers and stuff.
Is that something that you guys keep a close eye
on in terms of if there's suddenly a bit of
a log jam and certain companies can't get the resource
as they need the nutt what do you reckon?
Speaker 3 (28:07):
Oh? Yeah, and I don't. I think a lot of
the intended investment that some of the companies have talked
about will be tough for them to actually deliver it.
Speaker 2 (28:17):
So saying what they want to do and they could
have a great conference and think that we're going to
be building this data center and doing X, Y and z,
it's like, well, what have you got in terms of
the actual materialsts to do that? Is that still? Is
that a challenge?
Speaker 3 (28:28):
That's getting access to energy? Electricity is a big challenge globally.
Water is obviously they use water for cooling in many cases,
but there's just getting hold of the computer the GPUs
that actually drive these thing is a big challenge, So
a lot of people out there saying they're going to
I'm going to do this. We'll see have you got
(28:49):
the capital, have you got the resources. So we're in
a very interesting time in the whole tech space. And
over the last twelve months two years, it's been a
hot sector that we've all made a lot of money
at a ten. We've all got que savers that have
a slice of US and global docks. So we've had
a little bit of a win out of this already.
Speaker 2 (29:07):
Yeah. Wow, does that mean I could have a bit
of a loss out of it as well?
Speaker 3 (29:13):
Or I think what we're seeing is a broadening out
and particularly global share markets. Other sectors are coming up
and performing quite well. So while we've seen a little
bit of the bubble depreciating, all the bubble compressing and tech,
other sectors have done quite well. So you talked about
before about resources, and one of the hotter sectors in
(29:35):
the last twelve months has actually been mining or mining
it's a copper. Copper price more than doubled in the
last even the last year, in the last six months,
so it's just been literally pressure points there. So yeah,
I think we are seeing a broadening in the economic
activity globally that has lifted other parts of the other
(29:55):
parts of the shar market.
Speaker 2 (29:56):
People see that coming with the copper price going up
in the way that it has, would there be some
sort of smug funded managers are going, oh, I picked
this couple of years ago.
Speaker 3 (30:04):
Yeah, there are, and I think there is. There's a
supply you know, I can't it's actually there's been very few,
if any, large copper mines brought to fruition in the
last few years. It's incredibly capital intensive, hard to find
the resources that support the big development. So yeah, I think, yeah,
(30:27):
that is right, it's a supply side problem.
Speaker 2 (30:29):
Hey, look, we need to take a quick break. We're
with Shane Soley from Harvar Asset Management. It's fascinating conversation
about how everything's going, with what's going up and down
and the effect of AI and the AI stocks. We're
going to continue the discussion in just a moment. You
can jump there. I've got quite a few texts to
get onto if so. I'll get on to some of
those if we can before we wrap it up. But
(30:51):
it is right now twenty to six news talks 'b.
Speaker 1 (30:57):
This is a news talk z'b developing story.
Speaker 2 (31:01):
Yes, and developing news, the Orangutaki District has pardon my
pronunciation there, Rangutikai District has joined Taradua outa hunger and
why par in declaring a state of emergencies because of
a severe weather forecast forecasts for this evening, overnight and
tomorrow and the risk of heavy rain, rising rivers, slips, flooding,
(31:24):
strong winds and power outages. So there we go. In
developing news, the Rangutiki District has joined Taradu Ultra hunger
and why par in declaring a state of emergency. So
no doubt our newsrooms will be across that as it goes,
but obviously risks of multi multitude of adverse events there,
so we'll give you more details, no doubt in our news.
(31:47):
It is sixteen minutes to six.
Speaker 1 (31:52):
Tim Beverage on the weekend collective called eight hundred eighty
ten eighty News Talks.
Speaker 2 (31:58):
B Yes, and we're with Shane Soley and talking about
well a bunch of things, but basically about money investments,
shares a Shane. The one thing that popped out as
in the discussion this afternoon is the question also around
the big tech, those big AI companies, they're raising a
lot of debt to fund the AI investment. Does that
(32:20):
make does that carry with it a level of nervousness
about one of them going clang.
Speaker 3 (32:27):
Well, look, we've actually seen a little bit of pressure
on the oracle shep Rice we touched on before, and
that's the I'm not going to say the post a child,
but it's the one that people are most sensitive to.
You is this very much at the pointy end of
major investment. It's like, show me the return. Can you
show me that this these AI models are actually going
(32:48):
to deliver the return, then we're back. We're going to
back you, right. And so certainly the increasing financial borrowing
adds to the leverage within these businesses. So not only
are they sensitive to activity, they become financially leveraged. So
it increases that the tea your rests around it. I
guess we've seen this in the past and previous industry
(33:10):
changes where if you think about railways, for example, there
is a point in time where the railway industry borrowed
a lot of money and it eventually was correct, but
not everybody you made it through, not everybody railways were profitable.
Speaker 2 (33:24):
So yeah, it's funny one thing that one other thing
you touched on then wed show me the return. I
was thinking you almost imagined that there would be a
trivia line that that was the alternative line for Tom
Cruise and Jerry maguire. But it didn't quite sound as
good as show me the money. Show me the return,
doesn't show me the money, which is a rude way
of asking it in your business, I imagine, isn't it. Hey,
(33:47):
Look the other thing that's obviously we have a United
States administration in terms of the White House, it's unpredictable.
We've got mid terms happening. What is all the activity
in the United States political arena, including the potential for
some upheaval if you want to call it that with
the midterms? What does that mean for you guys for
(34:11):
investments in the S and P fifty end of the
whole shebang.
Speaker 3 (34:14):
Yeah. Look, I think as we saw were last year
policy announcements associated with mister Trump's if it's to retain support,
they could actually add to uncertainty in some sectors, in
some parts of the global economy. And look on you
know a great example right now is mister Trump talking
(34:34):
about potentially withdrawing from the US Mexico Canada trade Agreement,
and if that were to occur, that it had caused
some tariff issues, but also some trade chain had to
way know that supply chains are going to continue. And
there's a number of New Zealand businesses that are potentially
exposed their fish and popal healthcare wheen of New Zealand's
(34:56):
best kept secrets. It's great business. They manufacture in Mexico, and.
Speaker 2 (35:02):
So what's the best secret The fact that the just
such a successful.
Speaker 3 (35:06):
A great business. Yeah, and they use capital well and
they do a good job and they actually the key
thing is that they deliver fantastic outcomes for their patients
and the customers. So yeah, so they could be exposed there.
I think some hei there's some risks that the Trump
government has a bit of a swite winning healthcare voters. Again,
(35:27):
it's an easy one for them. I think the thing
we do at them tim it is a pro growth,
pro business government in the US. And we saw this
last year that, yeah, the tariff sort of certainly around
the original tariff announcements, there was a lot of volatility.
Markets didn't like it.
Speaker 2 (35:46):
They plunged for a while and all of a sudden
they bounced back up. I mean the cynical investors. I
mean people who are playing a little bit more fast
and loose with the way they gamble on their investments.
Would there be investors who are looking at the S
and P fift and the American stocks and just going,
let's wait for Trump say something stupid, and then the
(36:07):
stocks will plummet, and I'm just going to buy lots
because he'll change his mind because he doesn't like that,
and the stocks will rebound. I mean, if you in hindsight,
you'd think trump'son, wait till he really annoys the markets,
buy as much as he can. Then wait till he goes, oops,
that was a mistake, and up they go down. They
go up, they go down, they go what do you?
What do you guys do with it?
Speaker 3 (36:27):
I think it's soon something to think about, and there
are some nimble people out there that are doing it.
Pretty hard for most folks on a day to day
basis to do that, but there is definitely professional investors
that are doing it. And I think, you know, when
we we think about this government, the only certainty is
tap bombs, right, there will be uncertainty. There will be discussions. No,
(36:49):
I don't even.
Speaker 2 (36:49):
Know what's a tape bomb.
Speaker 3 (36:51):
Tape bomb is when mister Trump and his government and
now it makes an announcement announcement quite often on a
Sunday night US time, and it just creates a huge
uncertainty for investors that subsequently gets explained or modified as
you say, and markets tend to calm down.
Speaker 2 (37:09):
Okay, what about our election coming up? What does it
mean generally for markets? When we know we're oh my god,
they've started and we've had the State of Nation from
David Seymour today, we've had Winston I don't know when
he began electioneering as soon as he hung up as
hung up as job of being the deputy Prime minister.
But what is it? So it feels like we're going
(37:31):
to be election mode for a while. I don't know.
Maybe that's just because I'm in broadcasting. But what does
it actually mean for just general stability or volatility in
terms of investments in the share market and business? Yeah?
Speaker 3 (37:42):
Look, I think you know from the outside, you think,
oh gosh, there's going to be all sorts of uncertainty,
and it does depend on how the election rolls forward.
Some of the policy statements might or potential policy statements
could cause uncertainty and parts of the economy. It tends
to slow business confidence down, can send the confidence people
step back from making the big decisions. But for share markets,
(38:03):
the research actually shows that we do okay through election years.
We tend to do eight plus percent returns. That's on
average in the last you know, to go back more
than twenty years, that's the average, so you know, typically returns. Yeah,
certainly there's research from UBS here in New Zealand, so
average is ten.
Speaker 2 (38:24):
Actually makes sense because it's like the government does most
of its meddling in the years one and two and
then they sort of just are hoping that I'm not
saying they take the hands off the controls, but anything
radical they've probably done. So you've got, as it arguable
that you've got a more stable environment for business this year.
Speaker 3 (38:41):
Well, look, I think we've certainly seen some more stimulatory
policy coming through. There's a little bit more clarity some
of the as you say, big changes occurred early in
the current governments are reign and now we're seeing a
little bit of winding some stimulus starting to come through.
So yeah, I think there's a bit more clarity for businesses.
(39:01):
We know what to expect, and so we're in the
next phase is how does the economy get going again?
So yeah, I think ten percent plus a normal election year.
Not not saying that's going to happen this year, but
it's possible. And if I go back to the earnings
number four tim the market can sensus expectations. This is
on all the four gas. It's like twenty earnings growth.
(39:23):
That's a huge year. It will get watered down. It's
unlikely to be twenty, but even if it's ten, I'll
come back. That's enough to keep the shear market going.
So yeah, there will be parts of the economy, parts
of the market that get a little bit pushed around
electricity sector for example. That's obviously anything to do with
cost to cost of living. People always cost of living
(39:44):
will be a target for the elections.
Speaker 2 (39:46):
Okay, look, we're going to be back in just a moment.
I'm going to sneak in one final question with Shane
after the break about the housing market, and then we'll
be before we wrap it up. But when we're with
Shane Sally, this is smart money in News talks to
b eight minutes to say yes news talks there b Look,
we're got a very short amount of time left with
Shane Solifilm Harbor Asset Management, So I'm going to ask Shane,
as I love to ask lots of people, where are
(40:07):
we at with the property market? Because I think the
heady days of doubling every eight or ten years are
well behind us. What do you think proper market's got
save for the next year at least with.
Speaker 3 (40:17):
Yeah, yeah, it's always a loaded question, but market expectations
are for an improving turnover market, so more transactions, but
actually only slightly positive house price inflation, So HPI is
what we tend to focus on, and that includes both
nominal inflation and real growth, so couple percent perhaps, And
(40:40):
the reason why that is quite a modest number is
because we're still working through a really quite an elevated
level of available stock to sell. So there's a Bailey's
estimate there's more than thirty thousand homes for sale.
Speaker 2 (40:53):
Actually good more activities, more activities, sort of good news
for everyone who's not so much from the profit taking
point of view, But just if you're looking to sell
or you're looking to buy, more activity, well that's good news.
Speaker 3 (41:04):
Transaction activities helpful.
Speaker 2 (41:06):
Okay, hey, look gosh, that time flew. Shane, so good
to see you. Thanks for coming, Angston. We'll be back.
But don't forget the podcast. You missed any of the discussions,
go to news talks it Be or iHeartRadio. I'll catch
you again, same time next week. Enjoy the rest of
the evening.
Speaker 1 (41:26):
For more from the Weekend collective, listen live to news
talks it Be weekends from three pm, or follow the
podcast on iHeartRadio.
You're listening to the Weekend Collective podcast from news Talk, said.
Speaker 2 (00:09):
B oh, yes, welcome back. This is the Weekend Collective.
(00:46):
And by the way, if you've missed any of the
previous hours had a fans fascinating conversation with Matt Doosey
and Bok map around a bunch of things, you can go.
It's just after six flight you go and check out
the podcast at iHeartRadio or news Talk, said b But
I'm Tim Beveridge. We Want Your Cause on eight hundred
and eighty and eighty of course and text on nine
two nine two. By the way, that music was chosen
(01:07):
by my guest who is actually joining me in the
studio today and he is, well, he's Shane Solly of
Harbor Asset Management, and his choice of music to Shane, Hello,
how are you? Who is that?
Speaker 3 (01:21):
Is that? What's queen? Queen's the Stone Age?
Speaker 2 (01:24):
Yeah, the Ocean. I sat by the ocean, my producer,
it's it's it's it's a pan generational song. Obviously, because
she said, I think I've just found another song from
a playlist, So there's a win.
Speaker 3 (01:35):
I take that.
Speaker 2 (01:36):
Anyway, Look, we want your cause and look we've started
to see spots of what looks to be the recovery
and the economy. But it's not consistent, but it's frequent
enough to give us maybe some hope depending on who
you talk to. Of course, if you took the opposition,
it's all disastrous. Talked to some economists, they're like, well,
it doesn't look great, but we're optimistic. Then you've got
Westpac who's picking a lot of o c R hikes
from the end of this year. Another forecasts said a
(01:57):
similar scene. A better economy is coming. Rates will have
to reflect that. Or maybe we've got to get on
top of the old inflation which the numbers went so great.
But have you seen signs of economic recovery? We want
to know what you think on one hundred eighty ten
eighty text nine two nine two. But as I say,
Shane is here to talk about that and many other things.
He's a director, portfolio manager, research analyst at Harbor Asset
(02:21):
Management and here we are smart money. Shane. It is
good to see you.
Speaker 3 (02:28):
By the way, then, hey.
Speaker 2 (02:29):
Now that the question is going to ask you has
suddenly gone out of my head. But that that's the
thing that I was surprised that were you surprised with
Westpax predictions.
Speaker 3 (02:39):
Yeah. Look, I think what we're seeing at the moment
is the all the bank economists resetting there. So we've
seen a few of them come out with higher numbers,
particularly for inflation and where they think that's going to
lead to for the Reserve Bank official cash rat It's
really challenging being a bank economist. They've got lots of
different pressure points. But what we're at at the moment,
this this choppy recovery and economy doesn't really help them.
(03:03):
So parts of the economy are actually quite strong, of
Homon Canterbury or Otaga or South and pretty good.
Speaker 2 (03:09):
Canterbory is really smug right now, aren't they? You see
all christs. It's where it's at fair enough. Everybody has
been through a lot.
Speaker 3 (03:17):
Yeah, totally, And I think that's that's the benefit of
having a diverse economy in New Zealand. We forget that
that when one parts the economy is going, other parts aren't.
So you know, I think when we come back to
inflation per se, that's a big challenge. This week, we've
obviously got the Razzero Bank of New Zealand coming out
with official rate discussion on Thursday, and the markets are
(03:37):
not picking any hikes, right, so nothing, But if we
go forward a year, there's a whole one percent. We
get up to three percent from two twenty five. Now
this comes back to where the bank economists and others
are seeing inflation being sticky. Sticky is not going down
as fast we like. So we all know rates, insurance,
those sort of things hard to keep going down. Insurance
(03:59):
has stopped going up. That's a good start. The rates
is about a function of the interest rates, where if
the councilors have to pay for more for interest rates,
they pass it on to you.
Speaker 2 (04:10):
And I actually the rates part of the inflation equation.
Speaker 3 (04:17):
Yep, because there seems there's.
Speaker 2 (04:20):
Sort of something that I don't know how much should
that they be incorporated into the reserve banks consideration around
the cash rate because rates going up is not it's
different to prices going up in a way, isn't it.
I mean rates, it's a tax, it's a form of tax,
and it's something that is in itself surely a repressing
(04:41):
thing when it comes to inflation. And I'm not even
an economist, but that seems to intuitively make Iman banged
on about getting a c or a C minus at
university for stage one. But it's a pass, but it's
seas get degrees. But it is a tax and it
is anti inflation. Rates are anti inflationary, So why should
they be? Is that a pushback against worrying about it inflation?
(05:05):
If rates are, I mean, how much of a player
are they in the inflation figures?
Speaker 3 (05:09):
Yeah? Look, I don't know the exact numbers, to be
honest with a timbo. They're a component and they're the
piece that have been pushing up. So it's a bundle
of costs that we as consumers have to incurse. So
consumer price inflation is what CPI sands for. So it's
a tough one.
Speaker 2 (05:25):
You know.
Speaker 3 (05:25):
I've got the new governor, Anna Remen's come in. She's
been come across as being a little bit more hawkish.
I'm watching this.
Speaker 2 (05:34):
Hawkish with a smiley face.
Speaker 3 (05:35):
Correct.
Speaker 2 (05:37):
It's funny, isn't it that when you say hawkish, you
sort of think she doesn't look hawkish to me. Then
you think, hang on a minute, we're talking. It's an
interesting because she's very personable and yet hawkish.
Speaker 3 (05:46):
Yeah, totally. And I think so she's got this situation
where the economy is, as we're talking about before, just
showing signs of lifting off. It's a bit inconsistent. Well,
she's still got the tail of an inflation pulse that
she's dealing with. So in an ideal world, we can
have both. We can have a recovery with inflation blowing
(06:06):
out and that's it. That's it. That's something we don't want.
Inflation is not good for consumers, it's not good for
how we all can live our lives. So it is
an important thing for her to focus on. So I think,
you know, we come back this week, she's probably going
to talk about, well, you know, I'm seeing I'm seeing
the stickiness, and I'm sort of thinking about maybe could
(06:27):
be perhaps lifting rapes. Meanwhile, capital markets, investment markets have
already got quite a chunk priced in now. Yeah, so yeah,
we'll see. But it's unemployment is unfortunately not going down
in a hurry, right. That's a lagging indicator. This recovery
and activity is to really flow through, so hard to
really crank up rates when unemployment is palibate.
Speaker 2 (06:50):
It it's like the rhetoric around look, you know, they're god,
I love the cliches around economics, you know, the green shoots.
There's something that you hear all the time. You can
probably make it sound itself sound quite informed by just
recycling I could by recycling a few cliches, but actually
just on Anna Breman. So she's hawkish, but of course
it's a monetary policy committee that sets it's all these things.
(07:11):
How much influence what's the take of you people you
talk to in terms of her influence on the final
decisions that are going to be made around the cash rate?
Speaker 3 (07:20):
I think there's definitely. As you say, it's a committee,
so it is not one person making decision that's really important.
There's lots of different views. Similar to the US, where
we have a front person and they do have to
carry the decision.
Speaker 2 (07:33):
We can they have to walk the walk until they
resign and just disappear. Sorry, we'll move on mentioning any
names Andrean or whoops, carry on. Sorry, that's good.
Speaker 3 (07:46):
And so I think you know she has there's some
changes there as well. And so she's dealing with a
group that are certainly cautious and well versed in managing
this process. They've all got good backdrops for doing it.
So she's got a good group to work where it's
probably the best we'll put it.
Speaker 2 (08:04):
So where are we at in terms of your views?
I mean, you guys are at harbor a set. You
are dealing with making investments and on behalf of people
and making you know, doing the analysis. I mean you've
got a lot on your plate, just even in your
job description research analyst, portfolio manager and director. But okay,
so guys, within your industry and your your business, what
(08:25):
is the view of whether we are seeing either a
strong economic recovery or the potential for it? What is
your view of that?
Speaker 3 (08:34):
Yeah, look, it's economic recoveries are never a straight line.
Quite often, it's a bit like you when you're watching
a rocket take off. It looks slow and there's not
much going on, and then it gets a bit of
momentum and.
Speaker 2 (08:46):
Where we go.
Speaker 3 (08:47):
Yeah. Correct, And so when we look at the New
Zealand economy, we are seeing improving lead indicators. There is
definitely an improving trend. Last week we had a manufacturing
index out lead indicator. A purchasing manager in Nex's asking people,
what do you think you might do? And it was
fifty five point two, which is actually above fifty. Menus
asking who what the manufacturing industry.
Speaker 2 (09:10):
Okay, so in terms of how much you are investing in.
Speaker 3 (09:13):
Are you positive about the future, are you going to
hire more people, are you going to carry more inmentary?
Do you need to expand? So fifty five above fifty
menus are expanding. Below fifty minutes, you're shrinking.
Speaker 2 (09:24):
Yeah, okay, so that's good.
Speaker 3 (09:26):
Yeah, but it was it was down almost one percent
from the previous reading. It's still positive, but people are
going to some of the large and error stuff. Yeah, definitely,
you know, do you ask the question slightly different, but
it is indicative of the economy. It's two steps forward, okay,
one step stomach.
Speaker 2 (09:42):
We'll give that a slight tech then yeah, yeah, okay, yeah,
what else?
Speaker 3 (09:47):
And so we're seeing other indicative readings such as like
the A Z Truckometer. It's quite an interesting piece of
research they do where they literally manage a measure the
truck volumes in different.
Speaker 2 (09:59):
Parts of the country, volumes and distances exactly.
Speaker 3 (10:01):
Yeah, so we all have to pay our rucks and
a road user charge and they've got a good trek
when that's showing some recovery too. Again, come back, different
parts of their country are going really well. Auckland's still
not well in's and not things like construction industry slowing
in parts, so it's we're going through that sort of
(10:24):
trough getting better. So yeah, look that the net number
is improving.
Speaker 2 (10:29):
Can I ask a trivial question about the trichrometer? Would
it show a positive gain simply because there's been some
landslips and trucks are having to drive avoid that gorge
and drive another ten hours or something. Yeah, that would
be misleading, wouldn't it.
Speaker 3 (10:43):
It would be And it's a fear point that it
does pick up that extra I've had to go around,
I've had to do this, but you still do it
credits activity for sure.
Speaker 2 (10:52):
Yeah.
Speaker 3 (10:52):
So you've got to be careful about all these data points, right,
one data point not enough. It's got to be a composite.
Speaker 2 (10:59):
Oh I'm thinking. I was trying to think, what's the
international example, But it's the McDonald's in Decks or something.
Isn't there that around the world people look at the
price of a big mac. I don't know if that
has any time for our own situation, but let's stick
with a New Zealand at the moment. So we've got
the truchometer we've got agriculture. Where's that apt?
Speaker 3 (11:18):
Agriculture has been really strong, quite interesting though the EXCT
a pretty canny. Folks generally being careful about how they're
spending their money. There's a little bit of Obviously, we've
got a potentially quite a large payout for the dairy
industry from Fonterra threeund fifty thousand dollars plus per farm.
And does that happen in a couple of months time,
(11:39):
so you know we're not far away.
Speaker 2 (11:41):
God, the government must be licking their lips at the
prospect of this because it's gonna it surely will give
the appearance. I know a lot of people who use
it to pay down debt and a whole lot of things.
But that's a truckload of money coming into the economy. Ye,
what's your take on that?
Speaker 3 (11:56):
Yeah, I think it's a good pulse, right, and it'll
put some stimulus into parts of the economy. But you're right,
I think you know, we've already seen a lot of
farmers reduced it. There's a small number of farmers with
quite a lot of debt and they will probably use
the vast majority there. Others will start to think about, hey,
we need to spend a bit more money on lift
some capital investment on the farm, putt a bit more
fertilizer down, doing some works, and maybe you know, some
(12:21):
of them might spend a little bit of money on
just having a good time, which after working very hard,
they should.
Speaker 2 (12:26):
Do either a trip overseas or they're going to go
crazy at field Days.
Speaker 3 (12:30):
Actually when is it?
Speaker 2 (12:32):
Sorry, I'm going to ask a dumb question. You might
not know the data exactly, but so field days is
middle of the year. I think it's in June, and
if the payment's coming out in a couple of months,
so what are we going. I don't want to get
over the top with this, but man Field Days supplies
must be just thinking.
Speaker 4 (12:50):
This could be the best ever, wouldn't It will literally
be a field day for them. It will be Yeah, curiously,
just with one D. I had an argument with somebody
who actually is quite closely connected with field Days. I
was about to ask them, it's well, why is it
not two days?
Speaker 2 (13:05):
Two d's anyway, the South Island also, they're a bit
smug there, so that's a strong indicator though for us
that's South Island doing well. Is that just ag or
is it other things I.
Speaker 3 (13:14):
Think in certainly Canterbury, as you touched on, it has
gone through tough times. It's seen a recovery some of
that investment that's been made and lifting the productivity rebuilding
is actually starting to lift good migration too. By the way,
you're getting net migration into the south of the South Okland,
you know, not just from Auckland, but all from other
(13:35):
parts of the country and globally, so that's helping. We had
some migration stats last week terms that were sort of
net positive with less outbound, so there's a little bit
of you know.
Speaker 2 (13:46):
Still lots of outbound, but it was three thousand fewer
kiwis leaving.
Speaker 3 (13:51):
It's right, it's the start of a trend, perhaps.
Speaker 2 (13:54):
Something that a politician could make a headline out of,
but something that Harberra Asset Management will go, well, yeah, okay, good,
it's not getting worse.
Speaker 3 (14:04):
It's right. It's not enough to change your thinking on
a bunch of things.
Speaker 2 (14:07):
Actually, just on the migration thing. This is where I
just sort of think the amount of stuff you have
to get your head around, you guys, but migration does.
Is there a difference in the way we view the
stimulus of migration when it comes to New Zealanders staying
leaving versus non New Zealanders coming in or leaving.
Speaker 3 (14:28):
Yeah, I think ultimately it's about productivity, right. We want
people that are lifting the return per input. That's ultimately
what we're looking for an economy. I don't think you
can say a news unders staying is any better or
worse than.
Speaker 2 (14:40):
I was just wondering if there's a dollar amount that
attached to Like, if we had one hundred thousand people
coming in who were non New Zealanders, what would be going. Well,
there's a bunch of money attached to that, versus someone
who's just decided up to their ten year oe, I'm
coming home to stay with mum and dad.
Speaker 3 (14:52):
Yeah. Well, look if they're coming back out of ten
years happy to they're bringing some good skills back with him,
So that's there would be great. Everybody want to be
a one of Then.
Speaker 2 (15:00):
Hey, look we're going to say a quick moment. I'm
with Shane Soli, he's director of Portfolio Manager Research on
Harbor Asset Management, and we're talking about well money and
at the moment, the New Zealand economy, economy, the recovery,
what does it look like what's your take on it?
But also what does it mean for share market? New
Zealand share market investors might dig into that and other questions.
(15:20):
Got lots to get through with Shane Soli, but you
can jump the queue or button by giving us a
call on eight hundred and eighty ten eighty or text
nine two nine two. This is news Talks be smart money.
It's twenty two past five. Are you worried about funding
a comfortable retirement? Well you're not alone. The cost of
living crisis is hitting home for a lot of people,
(15:40):
so it's no surprise people are looking for ways to
make the most of their savings and get a little
bit more income to supplement their New Zealand super One
interesting solution is to invest in an income fund like
the Harbor Income Fund. It works by holding a mix
of interest paying securities and shares that have been designed
to generate a steady and sustainable income no matter the market.
(16:01):
The Harbor Income Fund is actively managed and currently it
pays a distribution of four point five percent per annum
after fees and taxes paid out in monthly installments. To
find out more about Harbor's Income Fund, just head to
their website. Or speak with your financial advisor. This is
not intended as personalized advice. The product Disclosure Statement for
Harbor Investment Funds issued by Harbor Asset Management is available
(16:25):
at harbor Asset dot co dot Nz.
Speaker 1 (16:30):
Your Weekend, Your Way, The Weekend Collective with Tim Beverage
News Talk zeb, Yes.
Speaker 2 (16:37):
News Talk SEB and my guest today is from Harbor
Asset Management. He's direct portfolio manager and research analyst. Shane Solely.
I do read the whole shebanga. I should probably just
say he's from Harbor Asset and he knows what he's
talking about. Hey Shane, now where are we at with?
I guess with New Zealand stocks, with the sheer market.
So we've got some good news stories which we've heard about.
(17:00):
What is New Zealand what's the nzs.
Speaker 3 (17:03):
Z fifty that's the one that's the benchmark.
Speaker 2 (17:06):
Well, thank you for that. What's that looking like?
Speaker 3 (17:08):
Well, look, to be really honest with you, last year
we had a bit of a recovery in the New
Zealand sher market, but it actually wasn't the most stunning
performer over the full year is up just out of
three and a bit percent. What we saw in the
second half of the year was quite a strong performance
seven and a half percent, and that's about investors anticipating
the economic recovery we were just talking about before, and
(17:29):
it was quite led by a lot of the mid
small capitalization companies that are more sensitive to economic activity.
But what we're seeing so far this year, we're down
about two percent. What we're looking for, tim is we're
coming into a profit reporting season for the December period.
So every six months, companies have to formally report how
(17:50):
their profits are performing, how their balance sheet looks, how
the business has been going, and so we're coming into
what's called the December profit reporting in February. Unfortunately, it's
a bit of a confusion there, but it's for the
December period, and so what we're looking for is whether
that reporting is and we'll give us a bit of
an infliction, whether it's enough to keep us, hey, look,
this momentum and earning is continue or not, or we
(18:14):
are sort of on the way not quite thee it's
about thirty eight companies, so out of that fifty and
the benchmark thirty eight or reporting, quite a wide range
of different companies reporting, so we'll get some insight as
to how the economy locally and globally is impacting on
the businesses, how they're managing costs, some of the productivity changes.
(18:36):
After over the last three years, which have been a
bit tough, companies have been putting major changes in their
businesses through whether that flows through the profitability. So, yeah,
it's going to be a really important period of time.
The next two weeks is going to be hyper busy
for us.
Speaker 2 (18:47):
Do people like you do you get surprised us with
profit announcements? And how much of this stuff can you
get wind of? Because there's a serious information and obviously
there's the whole lot of rules around confidentiality, But are
there winds that you can sort of get a sense
of where things are going just by the fact that
(19:08):
you've been following the fortunes of these companies.
Speaker 3 (19:11):
Yeah, Look, you're right. Markets do get surprises because it's
about expectations. It's about you and I having different perspectives,
different information. The work that we've done to land at
whether we're invested so publicly available information is the key
in New Zealand, that's what drives those expectations. But it's
(19:31):
up to me and the team I work with. I
work with a really great team of six people who
work their tails off to do discover understand how certain
businesses perform in different environments. And so yeah, we get
out there and scoot around and talk to as many
people as we can. But no, there's nothing that's unusual.
There's nothing those days. I can tell you. I'm truly gone.
Speaker 2 (19:54):
I don't mean it from the point of view of
anything dodgy, but it's just because, as you say, there's
so much public information. You can look at an industry,
well hear it. You might have heard about certain contracts
have been awarded, or turnovers or whatever. I mean, it
still doesn't tell you exactly how the profit loss sits.
Speaker 3 (20:10):
You just now do that's exactly right. You can win
something and you go, okay, is that good or bad?
Am I making money out of this? Or is it
actually a drag on the business long term?
Speaker 2 (20:17):
Yeah, And if you knew something a bit more about
just how the business is being run, that would would
help investors make decisions on that. And that's the science
of it all, isn't it. I guess that's the juice
that gets you guys out of bed every morning.
Speaker 3 (20:28):
Yeah, you bear the excitement at the moment, of course,
is this increasing use of artificial intelligence of AI, which
is really dragging in vast and information processing them really
fast and coming up with conclusions that may or may
not be correct, but they're driving markets.
Speaker 2 (20:46):
Actually, how is now we're going to talk about AI,
but in terms of the technology of what's available to
organizations like harbor resset management, how much grunt work does
it save you from doing? Because for most people who
casually use AILL know that you have to check it
double you know, you sort of have to get it
(21:07):
to double check its homework, and sometimes you have to
call it out. I've had that with chat GPT on
certain things with the research and I'll say I'd like
you to check that again because I've noticed this, and
it goes, oh, thanks for catching me up on that, Tim,
You're right to call me out for that. So my
trust is not you know, they're one hundred percent. Where
are you guys with the tool that provides for you?
Speaker 3 (21:26):
Yeah, look, I think it's it is just that it's
a tool. It does tend to create its own fills
the gaps, right, So it's because it's a probability based tool.
If it doesn't have the information. It'll pretend it does,
so you've got to be really careful. I'm going to
call out a friend of mine, Frank, who's a GP
up in Northland. He's an amazing guy. It does a
great job. They're using this stay of day for engaging
(21:51):
note doing notes and it's really improved his day. Right,
So taking a lot of time out of this day
formats things and gives them some edited notes. That's productivity.
That is really helpful. We are using a bunch of
different AI tools, but they're to support They speed things up.
Speaker 2 (22:08):
They don't replace with data analysis. It would be imagine
pretty amazing, wouldn't it would Does it still like to
fill in the gaps?
Speaker 3 (22:15):
You've got to make sure you're not letting it fill
in too many gaps. You've got to control it. It's
the same with having discussion about when you're talking to
somebody about our job. You've got to be very prescriptive
about it. It's you know, like I said, there's a
wide range of industries this is touching on, but this
so certainly we're using it, we're testing it out. It's
not driving what we do. It's part of our day
(22:37):
to day.
Speaker 2 (22:38):
Yeah, well, okay, so because they've been, there's been AI
has been in the news from a point of view
of investing over the last one in a week, a
few weeks or months weeks, should I say, And there's
been some ups and downs and investment markets. What's going
on there with people getting excited or otherwise.
Speaker 3 (22:55):
Yeah, what we've seen in the last four five weeks
is the release of a bunch of different models from
companies such as Open Ai Anthropic that have sort of
raised this question about can I use artificial intelligence to
replace my existing software solutions? And a good example to
use is perhaps zero. The accounting software is a service
(23:17):
business and we haven't seen it yet, but there is
Could I use AI to replace or internalize that service?
Speaker 2 (23:26):
Can I like for me? Can I get AI GST?
In correct, it's accountant, it's use zero and all that
sort of thing. That's right.
Speaker 3 (23:34):
So we've seen a model release for legal, a model
released for the wealth management insurance and last week freight
forwarding industries. Now, whether these models actually deliver the trust
and the quality that we all need to run our
businesses with is yet to be proven, but the share
(23:56):
market has gone, oh, this is a disruption risk. So companies,
share prices have been dropping twenty thirty zero zero is
down thirty five percent wow year today.
Speaker 2 (24:08):
And that's simply because of a what if.
Speaker 3 (24:10):
It's a what if. They are still pumping out cash,
growing their their user base, growing their monthly fees they
collect from their users. So it's just a disruption, and
I think, you know, I don't see just in the
meaning way. It's actually something that we've got to think of.
So we've got to We've got an area of the
(24:31):
of software that has been quite highly priced and because
people don't know that, industry disrupt the valuations if worn away.
Speaker 2 (24:41):
That's interesting because I wonder with zero, I mean zero
must be working on their own AI sort of thing
so they can meet that challenge. I would imagine that's
going on right now. Have they? Now? What have they
got going on there? Do you know? Only about that?
Speaker 3 (24:53):
They've got an offering called just us zero Jacks and
it is very effective. And you've just you've hirled something
that we think that the market is not paying attention to.
That some of these key service providers have actually got
their own AI solutions that could really accelerate their businesses.
(25:15):
So we're in that point where the market is unsure.
So it's kind of like self first, ask questions later,
it's up to these businesses deliver it.
Speaker 2 (25:22):
This sounds like people making how much of this is
based on really good, hard evidence in terms of what
a I can do versus just people's sentiment, and like
all AI is amazing. So therefore Zero is screwed.
Speaker 3 (25:34):
Yeah, there's not enough evidence to disprove it, and so
it's until that's the case, I can't disprove here. And
so I think what we're going to see is, as
you say, the company is using ALA themselves to reduce
their costs, improve their productivity, and so they'll have to
show us by retaining clients, growing clients, delivering better revenues,
(25:56):
delivering better profits. So every six months, as to say,
we get a snapshot.
Speaker 2 (26:00):
Because it's difficult, it's a difficult game for you to play.
It's the sort of thing where individual investors might their
own recons and go, hey, get on the blow. Hey look,
I want you to just stop investing and companies like
Zero and get into you know, check GPT and every
other AI company that's going. I mean, how are these
stocks of their AI companies? What's what? What is how's
that playing out for investors?
Speaker 3 (26:20):
Yeah, look, I think that certainly the MAG seven you
might have talked about before is not performing as well
as it has in the past. But because it's the
MAG seven, this is things like alphabet Amazon seven correct copyright. Yeah, yeah, yeah,
it's great, isn't it. So you know, we're certainly seeing
those businesses. Some are doing better, others lists so right,
(26:43):
So Oracle, which is obviously one of the global giants
in this space, it's been under pressure and one of
the things we're seeing is a lot of debt issuance
in this space, so that is undoubtedly putting a little
bit of pressure on that. There's an argument about software
eats the world and AI eats software. The AI businesses
(27:05):
need massive amounts of capital to support the growth, to
feed the beast of AI. So Morgan Stanley is estimating
that this year alone, the US hyperscalis, this is the
metas and the Googles will raise four hundred b in
US to fund the build out. Gosh, it is huge.
Speaker 2 (27:26):
Because there are the other things like that's very hungry
for resource when it comes to the power that drives AI,
are you I mean, this is just maybe it's focusing
too much on this issue. But is there a danger
with that that you know of because there's the sort
of this non sort of military or maybe potentially you know,
(27:49):
the battle for minerals and the minerals to provide the
resources to host all these massive data centers and stuff.
Is that something that you guys keep a close eye
on in terms of if there's suddenly a bit of
a log jam and certain companies can't get the resource
as they need the nutt what do you reckon?
Speaker 3 (28:07):
Oh? Yeah, and I don't. I think a lot of
the intended investment that some of the companies have talked
about will be tough for them to actually deliver it.
Speaker 2 (28:17):
So saying what they want to do and they could
have a great conference and think that we're going to
be building this data center and doing X, Y and z,
it's like, well, what have you got in terms of
the actual materialsts to do that? Is that still? Is
that a challenge?
Speaker 3 (28:28):
That's getting access to energy? Electricity is a big challenge globally.
Water is obviously they use water for cooling in many cases,
but there's just getting hold of the computer the GPUs
that actually drive these thing is a big challenge, So
a lot of people out there saying they're going to
I'm going to do this. We'll see have you got
(28:49):
the capital, have you got the resources. So we're in
a very interesting time in the whole tech space. And
over the last twelve months two years, it's been a
hot sector that we've all made a lot of money
at a ten. We've all got que savers that have
a slice of US and global docks. So we've had
a little bit of a win out of this already.
Speaker 2 (29:07):
Yeah. Wow, does that mean I could have a bit
of a loss out of it as well?
Speaker 3 (29:13):
Or I think what we're seeing is a broadening out
and particularly global share markets. Other sectors are coming up
and performing quite well. So while we've seen a little
bit of the bubble depreciating, all the bubble compressing and tech,
other sectors have done quite well. So you talked about
before about resources, and one of the hotter sectors in
(29:35):
the last twelve months has actually been mining or mining
it's a copper. Copper price more than doubled in the
last even the last year, in the last six months,
so it's just been literally pressure points there. So yeah,
I think we are seeing a broadening in the economic
activity globally that has lifted other parts of the other
(29:55):
parts of the shar market.
Speaker 2 (29:56):
People see that coming with the copper price going up
in the way that it has, would there be some
sort of smug funded managers are going, oh, I picked
this couple of years ago.
Speaker 3 (30:04):
Yeah, there are, and I think there is. There's a
supply you know, I can't it's actually there's been very few,
if any, large copper mines brought to fruition in the
last few years. It's incredibly capital intensive, hard to find
the resources that support the big development. So yeah, I think, yeah,
(30:27):
that is right, it's a supply side problem.
Speaker 2 (30:29):
Hey, look, we need to take a quick break. We're
with Shane Soley from Harvar Asset Management. It's fascinating conversation
about how everything's going, with what's going up and down
and the effect of AI and the AI stocks. We're
going to continue the discussion in just a moment. You
can jump there. I've got quite a few texts to
get onto if so. I'll get on to some of
those if we can before we wrap it up. But
(30:51):
it is right now twenty to six news talks 'b.
Speaker 1 (30:57):
This is a news talk z'b developing story.
Speaker 2 (31:01):
Yes, and developing news, the Orangutaki District has pardon my
pronunciation there, Rangutikai District has joined Taradua outa hunger and
why par in declaring a state of emergencies because of
a severe weather forecast forecasts for this evening, overnight and
tomorrow and the risk of heavy rain, rising rivers, slips, flooding,
(31:24):
strong winds and power outages. So there we go. In
developing news, the Rangutiki District has joined Taradu Ultra hunger
and why par in declaring a state of emergency. So
no doubt our newsrooms will be across that as it goes,
but obviously risks of multi multitude of adverse events there,
so we'll give you more details, no doubt in our news.
(31:47):
It is sixteen minutes to six.
Speaker 1 (31:52):
Tim Beverage on the weekend collective called eight hundred eighty
ten eighty News Talks.
Speaker 2 (31:58):
B Yes, and we're with Shane Soley and talking about
well a bunch of things, but basically about money investments,
shares a Shane. The one thing that popped out as
in the discussion this afternoon is the question also around
the big tech, those big AI companies, they're raising a
lot of debt to fund the AI investment. Does that
(32:20):
make does that carry with it a level of nervousness
about one of them going clang.
Speaker 3 (32:27):
Well, look, we've actually seen a little bit of pressure
on the oracle shep Rice we touched on before, and
that's the I'm not going to say the post a child,
but it's the one that people are most sensitive to.
You is this very much at the pointy end of
major investment. It's like, show me the return. Can you
show me that this these AI models are actually going
(32:48):
to deliver the return, then we're back. We're going to
back you, right. And so certainly the increasing financial borrowing
adds to the leverage within these businesses. So not only
are they sensitive to activity, they become financially leveraged. So
it increases that the tea your rests around it. I
guess we've seen this in the past and previous industry
(33:10):
changes where if you think about railways, for example, there
is a point in time where the railway industry borrowed
a lot of money and it eventually was correct, but
not everybody you made it through, not everybody railways were profitable.
Speaker 2 (33:24):
So yeah, it's funny one thing that one other thing
you touched on then wed show me the return. I
was thinking you almost imagined that there would be a
trivia line that that was the alternative line for Tom
Cruise and Jerry maguire. But it didn't quite sound as
good as show me the money. Show me the return,
doesn't show me the money, which is a rude way
of asking it in your business, I imagine, isn't it. Hey,
(33:47):
Look the other thing that's obviously we have a United
States administration in terms of the White House, it's unpredictable.
We've got mid terms happening. What is all the activity
in the United States political arena, including the potential for
some upheaval if you want to call it that with
the midterms? What does that mean for you guys for
(34:11):
investments in the S and P fifty end of the
whole shebang.
Speaker 3 (34:14):
Yeah. Look, I think as we saw were last year
policy announcements associated with mister Trump's if it's to retain support,
they could actually add to uncertainty in some sectors, in
some parts of the global economy. And look on you
know a great example right now is mister Trump talking
(34:34):
about potentially withdrawing from the US Mexico Canada trade Agreement,
and if that were to occur, that it had caused
some tariff issues, but also some trade chain had to
way know that supply chains are going to continue. And
there's a number of New Zealand businesses that are potentially
exposed their fish and popal healthcare wheen of New Zealand's
(34:56):
best kept secrets. It's great business. They manufacture in Mexico, and.
Speaker 2 (35:02):
So what's the best secret The fact that the just
such a successful.
Speaker 3 (35:06):
A great business. Yeah, and they use capital well and
they do a good job and they actually the key
thing is that they deliver fantastic outcomes for their patients
and the customers. So yeah, so they could be exposed there.
I think some hei there's some risks that the Trump
government has a bit of a swite winning healthcare voters. Again,
(35:27):
it's an easy one for them. I think the thing
we do at them tim it is a pro growth,
pro business government in the US. And we saw this
last year that, yeah, the tariff sort of certainly around
the original tariff announcements, there was a lot of volatility.
Markets didn't like it.
Speaker 2 (35:46):
They plunged for a while and all of a sudden
they bounced back up. I mean the cynical investors. I
mean people who are playing a little bit more fast
and loose with the way they gamble on their investments.
Would there be investors who are looking at the S
and P fift and the American stocks and just going,
let's wait for Trump say something stupid, and then the
(36:07):
stocks will plummet, and I'm just going to buy lots
because he'll change his mind because he doesn't like that,
and the stocks will rebound. I mean, if you in hindsight,
you'd think trump'son, wait till he really annoys the markets,
buy as much as he can. Then wait till he goes, oops,
that was a mistake, and up they go down. They
go up, they go down, they go what do you?
What do you guys do with it?
Speaker 3 (36:27):
I think it's soon something to think about, and there
are some nimble people out there that are doing it.
Pretty hard for most folks on a day to day
basis to do that, but there is definitely professional investors
that are doing it. And I think, you know, when
we we think about this government, the only certainty is
tap bombs, right, there will be uncertainty. There will be discussions. No,
(36:49):
I don't even.
Speaker 2 (36:49):
Know what's a tape bomb.
Speaker 3 (36:51):
Tape bomb is when mister Trump and his government and
now it makes an announcement announcement quite often on a
Sunday night US time, and it just creates a huge
uncertainty for investors that subsequently gets explained or modified as
you say, and markets tend to calm down.
Speaker 2 (37:09):
Okay, what about our election coming up? What does it
mean generally for markets? When we know we're oh my god,
they've started and we've had the State of Nation from
David Seymour today, we've had Winston I don't know when
he began electioneering as soon as he hung up as
hung up as job of being the deputy Prime minister.
But what is it? So it feels like we're going
(37:31):
to be election mode for a while. I don't know.
Maybe that's just because I'm in broadcasting. But what does
it actually mean for just general stability or volatility in
terms of investments in the share market and business? Yeah?
Speaker 3 (37:42):
Look, I think you know from the outside, you think,
oh gosh, there's going to be all sorts of uncertainty,
and it does depend on how the election rolls forward.
Some of the policy statements might or potential policy statements
could cause uncertainty and parts of the economy. It tends
to slow business confidence down, can send the confidence people
step back from making the big decisions. But for share markets,
(38:03):
the research actually shows that we do okay through election years.
We tend to do eight plus percent returns. That's on
average in the last you know, to go back more
than twenty years, that's the average, so you know, typically returns. Yeah,
certainly there's research from UBS here in New Zealand, so
average is ten.
Speaker 2 (38:24):
Actually makes sense because it's like the government does most
of its meddling in the years one and two and
then they sort of just are hoping that I'm not
saying they take the hands off the controls, but anything
radical they've probably done. So you've got, as it arguable
that you've got a more stable environment for business this year.
Speaker 3 (38:41):
Well, look, I think we've certainly seen some more stimulatory
policy coming through. There's a little bit more clarity some
of the as you say, big changes occurred early in
the current governments are reign and now we're seeing a
little bit of winding some stimulus starting to come through.
So yeah, I think there's a bit more clarity for businesses.
(39:01):
We know what to expect, and so we're in the
next phase is how does the economy get going again?
So yeah, I think ten percent plus a normal election year.
Not not saying that's going to happen this year, but
it's possible. And if I go back to the earnings
number four tim the market can sensus expectations. This is
on all the four gas. It's like twenty earnings growth.
(39:23):
That's a huge year. It will get watered down. It's
unlikely to be twenty, but even if it's ten, I'll
come back. That's enough to keep the shear market going.
So yeah, there will be parts of the economy, parts
of the market that get a little bit pushed around
electricity sector for example. That's obviously anything to do with
cost to cost of living. People always cost of living
(39:44):
will be a target for the elections.
Speaker 2 (39:46):
Okay, look, we're going to be back in just a moment.
I'm going to sneak in one final question with Shane
after the break about the housing market, and then we'll
be before we wrap it up. But when we're with
Shane Sally, this is smart money in News talks to
b eight minutes to say yes news talks there b Look,
we're got a very short amount of time left with
Shane Solifilm Harbor Asset Management, So I'm going to ask Shane,
as I love to ask lots of people, where are
(40:07):
we at with the property market? Because I think the
heady days of doubling every eight or ten years are
well behind us. What do you think proper market's got
save for the next year at least with.
Speaker 3 (40:17):
Yeah, yeah, it's always a loaded question, but market expectations
are for an improving turnover market, so more transactions, but
actually only slightly positive house price inflation, So HPI is
what we tend to focus on, and that includes both
nominal inflation and real growth, so couple percent perhaps, And
(40:40):
the reason why that is quite a modest number is
because we're still working through a really quite an elevated
level of available stock to sell. So there's a Bailey's
estimate there's more than thirty thousand homes for sale.
Speaker 2 (40:53):
Actually good more activities, more activities, sort of good news
for everyone who's not so much from the profit taking
point of view, But just if you're looking to sell
or you're looking to buy, more activity, well that's good news.
Speaker 3 (41:04):
Transaction activities helpful.
Speaker 2 (41:06):
Okay, hey, look gosh, that time flew. Shane, so good
to see you. Thanks for coming, Angston. We'll be back.
But don't forget the podcast. You missed any of the discussions,
go to news talks it Be or iHeartRadio. I'll catch
you again, same time next week. Enjoy the rest of
the evening.
Speaker 1 (41:26):
For more from the Weekend collective, listen live to news
talks it Be weekends from three pm, or follow the
podcast on iHeartRadio.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
Fudd Around And Find Out
UConn basketball star Azzi Fudd brings her championship swag to iHeart Women’s Sports with Fudd Around and Find Out, a weekly podcast that takes fans along for the ride as Azzi spends her final year of college trying to reclaim the National Championship and prepare to be a first round WNBA draft pick. Ever wonder what it’s like to be a world-class athlete in the public spotlight while still managing schoolwork, friendships and family time? It’s time to Fudd Around and Find Out!