Managing the calm: waiting for the storm.

While things are positive here we are simplifying things down. I am a recovering hoarder, and we are selling things I don’t use any more. Old musical instruments. Books that I won’t read again. The Christmas tree we kept when we combined households which is far too big for Casa Weka (My old house, casa pukeko, had a 18 foot high ceiling: this house has 14 foot at the highest point).

I’m working on side gigs when I can and Kea is getting business. But we are watching the spend. Because the storm will come, and then you do not want to be beholden to the banks.

The shopping

There are a number of butchers online that will allow us carnivores to find perfectly sourced organic meat. Nah. We go to the poor part of town and to the local “Mad Butcher” chain. The original Mad Butcher was in Mangere which my parents left to move up to a better suburb in South Auckland — Otahuhu, which is now and then the New Immigrant landing place. It has meat. It has offal. Supermarkets have trimmed, lean meat. Eat what you can afford. Which means avoid the hippie health food shops.

To research this article, I biked over to the health food store in my town, a place called Natural Grocers that attempts to imitate Whole Foods. It seemed like a friendly place, where the customers are unusually slim, the bike rack sees frequent use, and everyone brings their own cloth grocery bags.

But Holy Shit, were the prices ever ridiculous there! In one quick tour of the store, I observed a package of four “Bison hotdogs” priced at $11.85, a two-pound bag of plain Tilapia filets at $25.00, and jugs of organic milk at $11.00 per gallon.

All of these prices are more than double the levels of the nearest Costco, which is one of the best places to shop for your calories and protein, unless you have even better options in your area. The prices I quoted in my $1.00 meals table above were Costco prices, and unless you already have unlimited money, you should stay miles away from Whole Foods or any of its cousins.

At a more community-oriented level, there are also good deals to be had in Mexican, Indian and Chinese grocery stores, Community-supported agriculture groups (CSAs), farmer’s markets, your own vegetable garden, and other old-fashioned sources. When the parking lot is not full of hybrids, there are international phone cards on display in the window, and the cashiers also stock their own shelves and do not speak much English, you are probably onto something good.

The Money Mustache

Locally, we don’t have the kind of stores the Mustache describes. If I lived in Auckland still, I know where to find them. Where I grew up. But Auckland has a maximum “affordable house price” of 650K, and that gets you an apartment without a laundry or parking. No thanks.

The news

Times are tough. For investors, even conservative ones, there have been considerable losses.

The US dollar is trending weaker on the markets, but the Kiwi dollar is not responding as well as the Aussie dollar. The Kiwi dollar is slipping. It’s worth noting that we have a progressive government and will have tax increases in the next budget while the Australian Federal government is trying to open things up as fast as possible and has signalled tax cuts to stimulate the economy. Right now the interest rate on AA rated banks is around 0.05 to 0.10 percent.

Yesterday, our Prime Minister talked to the Business Council. She indicated that she wanted to support small businesses with loans, and extend flexibility and funding apprenticeships. She wants to see the border remaining closed for the forseeable future. The authors comment:

Notably, Ardern didn’t mention the minimum wage increase planned for next year.

Nor did she talk about Labour’s policy to introduce a new top tax bracket for income above $180,000.

And she didn’t reference the country’s enormous asset price inflation and the Reserve Bank’s role in the economic recovery.

We are still having very high house prices and the current governmental policy of subsidizing by 10k a person for a house under $450K (with 10% deposit) means that the most shonky fixer uppers in my town have inflated to around 400K. People are saving 20K getting 20K for the couple and taking a 90% mortgage at the current low interest rates. This is an artificial inflation of prices and will make a housing bubble (which we are in) collapse worse.

The storm will come financially. Get ready now.