S and P agrees with us on NZ banks

Bank Failure RBNZ

This week:

  • New look website
  • Bank Downgrades
  • (More) Central Bank intervention
  • This weeks articles
  • S&P agrees with us on NZ banks
  • Charts for NZD gold and silver

New look website

We have at last unveiled our new look website this week.  Still the same useful (we hope!) content but with a fresher look.  We’ll be making some more tweaks here and there in the coming weeks too.


Bank Downgrades

We’ll it’s been an action packed week in the world of money.  We’ve had bank downgrades worldwide affecting the 4 big Australian banks and their New Zealand subsidiaries too.  All were downgraded 1 level.


(More) Central Bank intervention

Then (conveniently we could say) the next day we had the co-ordinated Central Bank action with the Fed halving the interest rate they charge the ECB for dollar swaps (If you want a description as to how this works then check out this CNBC article, “How Does Europe Borrow Dollars From the Fed?”). So that appears to have bought some more time for Europe although who knows how much.

We were fortunate enough to attend a small gathering with Professor Fekete on Monday night and he commented he would not be surprised to see some major events take place by early in the New Year.  He also thought the Europe situation was largely engineered as a distraction from the serious debt issues the USA has.  So he felt that will come back onto everyones radar again before too long.


Professor Fekete and this weeks articles

In honour of the Professor Fekete being in Auckland last week for a Gold Symposium here we’ve published the Professor’s latest article “What Chinese Unemployment?”.  He has a different take on the impact of a China slowdown.

Also this week we’ve finally typed up our notes on the the Panel Discussion on the final day of the recent Sydney Gold Symposium. This Panel featured the big names of the event: Eric Sprott, John Embry, Egon von Greyerz, & Ben Davies.  So check that out as they answer common questions like, “How much should I have in precious metals?”.  And “What percentage should I have in gold versus silver?”

And if you’re mulling over shares in precious metals miners the final article this week has some astounding numbers in term of performance during precious bull markets in precious metals shares.  “What ‘to the moon’ will look like“.


S&P agrees with us on NZ banks!

Back on the subject of banks and following on from our article last week “Bank Failures – Could they happen in NZ? The Reserve Bank thinks so”, we stumbled across the S&P report on Asia Pacific banking after the downgrade announcement.  (And no we don’t have any inside banking connections.  It was merely coincidental that we wrote an article on bank failure 2 days before a worldwide bank downgrade!).

Anyway here’s the relevant section of the S&P report to little ole NZ… [emphasis added ours]

We believe “systemwide funding” is an area of relative strength for the region, and we assess 10 of the 16 systems as “very low risk” or “low risk”. One reason for this is the region’s high domestic savings rate, which exceeds 30% of GDP in a number of countries. This is an important contributor to the relatively stable deposit bases that reduce the need for external funding. Two notable exceptions to this general trend are Australia, which we evaluate as “intermediate risk”, and New Zealand, which shows “high risk”. Persistent and significant current account deficits–fuelled by lower savings relative to investment demand and consumption–mean these two countries show the lowest level of customer deposits and the greatest dependence on net external borrowings in the region. Nevertheless, we believe these risks are partly mitigated by factors such as supportive central banks, access to sizable domestic debt capital markets (Australia), and support from parent groups (for New Zealand banks).


As we pointed out in last weeks article the “high risk” to the New Zealand bank sector is that they rely upon offshore funding for a good portion of their borrowing.  So don’t say you haven’t been warned.


Charts for NZD gold and silver

Here’s the 6 month charts for gold and silver.  At the moment it’s the NZD/USD exchange rate that seems to be the main impact on our local prices.  Gold has been holding up pretty well, although it is now down $100 on what it was a few weeks ago, sitting at about $2225.

Gold Chart in NZD


Silver still looks pretty good value to us too.  It’s continues to consolidate within a slight down trend.  But notice how it’s had plenty of support at about $38, currently sitting at about $41.

Silver Chart in NZD


Silly season hours

We’ll still be open for business over the holidays although 2 of our suppliers will be shut from the 24th Dec until returning on the 9th Jan.  Another supplier will still be taking orders on non stat days but won’t be dispatching any orders until the 9th January.  So there will only be limited product options over the 2 weeks of Christmas and New Year.  So just 2 and a half weeks left to get your gold and silver!

Give David a call on 0800 888 465 or emailorders@goldsurvivalguide.co.nz if you’d like a quote before then.

Have a golden week!



Glenn (and David).
Gold Survival Guide




Antal Fekete: What Chinese Unemployment?
2011-12-04 23:37:41-05 Given that Professor Fekete is currently still in New Zealand after presenting at the Gold Symposium, we thought it appropriate to post his latest article in honour of this.  We’re also off tonight to a small gathering with him so will see what else we can learn while there.  As always his writings are very […]
read more…
Gold Symposium Sydney: Panel Discussion featuring Eric Sprott, John Embry, Egon von Greyerz, & Ben Davies
2011-12-06 04:37:56-05 A highlight of the recent Sydney Gold Symposium we attended was the panel discussion at the conclusion, which featured the 4 big names of the event: Eric Sprott – Sprott Asset Management John Embry – Sprott Asset Management Egon Von Greyerz – Matterhorn Asset management Ben Davies – Hinde Capital This was the audiences chance […]
read more…


What ‘To The Moon’ Will Look Like
2011-11-30 20:49:15-05If you’ve been mulling over whether having some gold shares might be a good thing, then WARNING! the following might convince you.  It details how both the larger producers and also juniors performed in previous bull markets in mining shares.  Some of the percentage gains were staggering even to us.  However the shares have been […]
read more…

Leave a Reply

Your email address will not be published. Required fields are marked *