ZM's Fletch, Vaughan & Hayley - Fletch, Vaughan & Hayley's Lil Bitta Pod - 28th December 2023

Episode Date: December 27, 2023

On Today's Lil Bitta Pod; Bad News Brad Olsen joins us!See omnystudio.com/listener for privacy information.

Fleshborn and Hayley's Little Bitter Pod Enjoy a refreshing McCafe iced coffee available only from Macca's Great things are brewing Welcome to A Little Bit of Pod, the big pod and the show is back on January the 15th Doubt it In studio, Bad News Brad, Brad Olsen, CEO of Infometrics What a great guy And he knows, hey I I've got a podcast.

Can I talk about other podcasts on this podcast? It kind of feels like you're cheating on us. It feels like they should pay. Do you know what I mean? The podcast you're going to plug, it feels like they should pay. So is this going to have hashtag ad on it? No, because this is an absolute freebie. It's just a little podcast.

People will churn through them really quick. I'm sure you would. The Economics of Everyday Things. Have you heard about this? No, I haven't. Look at that. He lit up. He loves economics. It's by the author.

Freakonomics Radio Network. Oh, nice. Yeah, the podcast. But they're just like super little digestible things. I'll send you a link right now. See, I just, I listen to the one good pod that I have to every day. And when I say every day, I catch up over the weekend. Fletch, Vaughn and Hayley.

Podcast. Podcast. We've got a jingle now do we we just wrote it all together actually it's better than the Christmas voices let's be clear let's fun and Hayley

podcast beautiful we need one of those things you know that Netflix has like it is called what's it called

it's got a name sting something branding no it's something it's got a name it's got a name we're not moving on until you think of it so come on now it's Something It's got a name It's got a name We're not moving on

Until you think of it So come on now This will be a long pod Symphonic branding I've listened to a podcast About how important They are for businesses To have

Oh that's a ta-dum Ta-dum It's a Quantum branding Not quantum branding Something branding I love how nerdy You guys get about this stuff

That sounds Sonic branding Sonic branding That's what it's called Quantum branding. Something branding. I love how nerdy you guys get about this stuff. About sounds. Sonic branding. Sonic branding. That's what it's called. That's what. Is anything that's a sound. Yep.

Sonic branding. See, that's what some people call me every now and then. Sonic branding. Should we come up with one? Now. Fladoink. Fladoink. What we thought we'd discuss on this little bit of pod with you, Brad Olsen, the year ahead, 2024. Thank God.

Because 2023 was a dumpster fire as well. Can I say, if you're going to tell us it's going to be just as bad as 2023, you can fuck. You can fuck, Brad. Oh, look, I'll just leave now. Because when they sang at the end of last year, don't expect interest rates to kind of back off until, what, the end of 24 or 25?

That's the thing. You know, this year's going to be, I think. Fuck off. They promised me midway through 2023 was the peak. They promised me. And then it went up at the end of 2023. Hold on. Who's this they promised you?

I never said that. Same time you said to Hayley, spend all the bank's money renovating your house. Come on now. Come on. We're not blaming you for our misfortunes. It also is that people misremember what? All the time.

Or attribute to you. But Brad, you said da-da-da. And you're like, I never said that. No, they just hear what they want to hear. They hear exactly what I'm saying. They hear what they want to hear and they misinterpret it as Brad told me. My favorite one was when a guy emailed me

after someone did a TV interview. Not me, another economist. And like, oh, I hated what you said this morning on xyz show and i really wanted to go back and be like mate i haven't been in front of a camera in like two weeks but pop off yeah yeah okay 2024 2023 we can say was an absolute dumpster fire financially cost of living was horrendous for so many people. It actually got outrageous. 2024. Lighten it up, Braddy. Is it going to be any better? I think we're getting some improvements.

I think you're going to see that rate of inflation continue to slow. Now, that doesn't necessarily mean that lots of stuff becomes cheaper, but you look at the last couple of years and stuff's just been increasing at huge paces, leaps and bounds and leaps and bounds. This year, I think you're going to see a little bit less of that intense level of increase. There's still going to be some areas that are hot, like rents, for example. There's still a lot of people that are looking around for stuff, but we're seeing

some better moves in other places. It's the interest rates that I think will be interesting, because of course, that's the thing that most people are looking at. They're questioning when are they maybe going to start to pull back. At the moment I don't see any case for them to go up further So there's still, I think, a lot of people who are going, man, I'm not sure what my household budget looks like this year, not sort of sure how to make money work. That's better than last year when it was sort of up and up and up. Now it's a bit more, okay, I know what it's going to be, I can stabilise and what have you, but still tough, still difficult out there.

So would you say if you were someone who has managed to keep that lower interest rate to this point, but they're fixing now, that they could budget based on that high rate, maybe with some security that it won't go higher. Not holding you to it, as we say. That's sort of the starting position. That they could go like, oh, well, it's 8 point or 7 point, whatever,

that I could budget my household budget, as you say, on that number without going, it's going to get exorbitantly worse. What rate are mortgages being tested at by the bank? About 9% at the moment. So that's when you apply for a mortgage at the bank and the bank's like, okay, but we need to know you can repay it if it gets to 9%. Because when we first got our house in 2010,

I think it was like five and a half or six. No need to brag. No need to show off. But I'm just saying, shit's gone. It's far worse, right? Yeah, yeah, yeah. And then it went even down further over the pandemic when interest rates were like rock bottom. They were delicious.

And then, yeah, now it's, I read the other day, it's like nine and a half. Nine is the tester. Well, I think as well, if you go back to like when interest rates were at their lowest, you could get a one-year mortgage rate for like 2.2%. And at that point, you were being tested around sort of six, six and a half. Now, of course, we've gone a bit above there. So, you know, if I was getting an interest rate at 2.2, I probably wouldn't have been thinking about six or six and a half as the actual upper limit.

Where we are at the moment, I guess a lot of people would probably be looking at interest rates and going, hey, if I can meet 9%, with expectations not for interest rates to actually go to 9%, people aren't thinking they actually go up to that level, but if you're comfortable enough, if your bank's comfortable enough at 9%, maybe you go, oh, maybe we can sort of make that work a little bit better. I mean, you are seeing more first home buyers and that coming into the market, so there's a little bit more there. It's also, though, I think that question is how long do you lock in for?

And again, we've talked before on the show. We ask you every time. Yep, people are still thinking about that sort of two-ish year period or sort of they're wanting a little bit more stability. But here's probably the biggest recommendation. If you're doing, and as everyone in my humble opinion should, a bit of a summertime sort of financial detox and a bit of review, where's your money parked at?

A lot of people are going to have some sort of emergency savings or hopefully building up some money. Is that just sitting in an account that makes no interest? Have you got one of those like serious saver accounts or something that's making you some money?

Have you put your cash into a term deposit because you don't need it for six to nine months? All of those at the moment, because yep, mortgage rates are high, but if you've got money and you're a saver, actually you should be getting some pretty good returns, but you've got to make sure it's in the right places. So hot tip, yep, mortgages probably not looking great, but hopefully a little bit more stability. Term deposits and that, people I think are still making some good savings returns. Would you be better though if you did have a mortgage

and a little bit of cash saved, you'd be better to have it one of those my bank calls it total money where it just kind of offsets the debt because you're not going to make as much money in a term deposit as you'll save by not paying the interest But also with that money you probably don't want to put it directly on the mortgage straight away because you might need it if the car breaks down

So yeah, if you've got that sort of facility or something to balance it out, better way to do it, absolutely. Flexible loans, yeah. Yeah. How are we compared to the rest of the world in terms of, like, cost of living, inflation? Thank you.

Because Australia's still having issues, aren't they? They've had a lot of rate rises, like, more than us? Yeah, they've had fewer rate rises, but they've done it more recently. Right. We went a lot harder, a lot faster at the start, sort of like COVID. You know, we've been with curve and ascents. It was Jacinda's turn, wasn't it? Go hard, go fast.

Go hard or go home, was it? I was going to say, go hard or go fast seems like another sort of term. Go hard, go early. Yeah. No, she said, I live my life a quarter mile at a time. Oh, right. And she said family. Yeah.

Yeah. A lot. Family. Yeah. And she's had 10 of those movies now, so I think she knows what she's doing. Yeah, right. Jacinda Diesel, that was the Prime Minister, wasn't it? family. Yeah. Yeah, yeah, yeah. Family. Yeah, and she's had 10 of those movies now, so I think she knows what she's doing. Yeah, right. Jacinda Diesel, that was the Prime Minister, wasn't it?

Yeah, yeah, yeah. Cindy's a whore. She's rocked it, man, Cindy's a whore. Yeah, yeah, yeah. But Fast and Furious, Beehive Drift. Yeah. Beehive Drift. Good from you, Brad.

Good from you. Back to the question at hand. Where are we in relation to the rest of the world? So, Oz is interesting because their equivalent official cash rate has actually been lower than ours for quite a bit, but they keep expecting to need to increase theirs, which means that if you're an Oz borrower,

you're looking at your mortgage rates and going, well, they're still going to go up and probably go up throughout the year. Whereas in New Zealand, we're going, actually, we've sort of done the heavy lifting early. Not everyone's gone on to them, but you sort of know what interest rates are going to be. And that's starting to come through in inflation as well. Again, New Zealand's inflation heading in the right direction. Australians are a little bit more worried about how persistent inflation might be at those higher levels. So again, I think it's a little bit

of a timing thing. We moved a little bit faster, probably got hit a bit harder earlier. Oz is probably sort of dragging this out a little bit longer than they need to. Yeah, wow, that's a really interesting way of doing it because it hurt. But now maybe we might see some brighter horizons. Well, yeah, but there's also still a lot of hurt coming along, isn't there? Yeah. When people come off there. It's not a fun time.

Well, no, I'm just being realistic. We've got Bad News Bram, we've got Negative Bloody Nelly next to us. Yeah, Negative Nelly. What about, so that's your housing, that's your kind of, what about the general cost of living? We've got things like petrol, food, like other things that we're spending our money on just to survive. Food, again, is improving. You particularly produce some of the grocery items and that.

Not only food, but laundry powder and that some of the the grocery items and that um not only food but late in the laundry uh powder and yeah right like like the stuff hayley's got sprinkled through the back of her car yeah actually if anyone's short on powder you could just sort of like get a hoover in the back of mine because i've knocked two boxes in the back of my car i would almost just go to the um the car wash with your windows down chuck a load in the back oh my god oh my god i'll get clean the clothes are clean, the car is clean. Great. He's smart, our Brad.

So, I mean, those ones have got fuel. Fuel's flippin' expensive, especially diesel in recent times. But again, this coming year, I don't think there's probably as much upwards pressure. If you see the global economy that starts to shift back, and that's what expectations are, you might see fuel prices, maybe they don't go down a lot but but at least they might sort of hold uh it's some of the other stuff where again the world's getting back towards normal after the pandemic you know international airfares for example they're getting a little bit better it's a little bit cheaper or again not as expensive to go overseas hopefully it's not going to cost five hundred dollars to

fly to christchurch from auckland well. Well, see, that's the difference. International prices are coming down. Those domestic fares, yeah, we're spending. I mean, you fly so much, Brad, and thank God it's part of your job because I just can't believe it. Last year was horrendous for that. I remember when I went home

for Christmas in 2022, I paid over $500 one way to get from Wellington to Whangarei and I said to my family, guys, there's no presents this year. I am your present. My present is your present. Me being here is your present.

I don't love you that much. I don't know if they like that or not, but to be fair, similar sorts of conversations this year. Yeah, fuck them. Fair, you know. Actually, fuck them. Can you tell that?

I'm going to play this to them. Yeah, I know. I'll write them a card. To be fair, fuck you. Yeah. There is a lot more competition, though though on some of the international routes. So like getting to America now, there's so many more airlines. So that's driving the price down.

Competition, yeah. But then also if you're looking to holiday like this year, would you go to America? Because the dollar's so shit. Yeah, I mean, and having been there in the last couple of months, every day I was looking at the exchange rate and going, well, that sucks. Sucks to be me. It's interesting because I think what's the difference, though, is we're getting a lot of Americans coming to New Zealand.

That's pretty cool for our tourism because Americans are high spenders. So that's helping us in a sense. But yeah, going over there at the moment sucks. To be fair, it doesn't seem to be stopping anyone. The number of Kiwis heading off on overseas holidays still pretty high yeah uh people are having a good time you know there's still probably enough people that have saved up some cash during the pandemic or have sort of and i think this is having been in america this is interesting because you're still seeing you know taylor swift tickets and similar being spent on a huge uh people are spending a lot of money on those things even though they're

expensive as hell and i think what it is is, is people going, you know what? If I'm going to spend on something, I'm going to do it properly. If I'm going to die tomorrow in a pandemic, I'm going to go out on top sort of thing. And so maybe I don't do three or four things, but I do one thing that I do it bloody well. Because if you see a dress and you know, that's a dress of a lifetime, you've got to grab it.

It might run out of your size. I like that we've gone from international travel and Taylor Swift tickets to a dress. Well, just, you know, you never know. You never know. Vaughn and I were talking about this today because you coming in made me think. Is this another advice panel?

No, this is kind of putting you on the spot. It's kind of like a weird question because I was thinking if, you know, we have another couple of years, the world goes back to normal, prices come down. God forbid there is another pandemic. Would countries do it all again the same? Would they throw so much money in and cause this inflation and this pain?

Look, I'd really like to think we learned a bit of a lesson through the pandemic. I'm not actually sure that we did. I'm not saying that we should not help people because it was so good that you know my god companies could you know get money and stuff but i was just thinking like would that stop countries giving like helping their people what's the better of the two evils yeah what like what what do you think would would anything be different second time around that's the thing i think probably yes and i think you can do both i think you can still help a lot of people and help a lot of businesses without necessarily generating as much inflation and i mean in terms of you know would i do the wage subsidy and similar again yeah would i do it you know for three years in a row once the economy was definitely back on its

feet no right would i drop interest rates again yes would i leave them low even when the economy is quite clearly looking a lot better no i'd raise them quicker would i go and print money probably not that was an experiment that i don't think anyone did very well out of unless your bank's in there well I did I printed my own and I was able to get away with some of it

I was going to say how good's your hit rate there because I know the Reserve Bank looks out for people who make scammy notes I've got a very nice printer brand it's HP oh I thought it was a brother

it's an HP is it a nice like inkjet yeah it's inkjet it's inkjet I laminated it how'd you get the window in the notes just lamination

a bit of glitter and nail polish like an iridescent sort of's like jet. How'd you get the window? How'd you get the window in the notes? Just lamination, a bit of glitter and nail polish, like an iridescent sort of nail polish. Sorry, I was calling Adrian Orr at the moment. No, no, no need. No need. It's in the past now. That's interesting because I just wondered,

I wondered if it would be done differently because that's kind of what's caused this, right? Well, hopefully, Fletch, we never have to find out. It doesn't look like another pandemic. It was also untested ground, right? We've never done this before. The last time it was on that scale was literally 100 years before at the end of World War I when everyone was tearing Spanish flu,

which is only called Spanish flu because the Spanish weren't like, hey, hey, hey, hey, no, no, no, no, no, no, no. They just kind of, everyone blamed the Spanish. Things are so different. I mean, you look back at the Spanish flu, not only was that 100 years ago, the economy and the world was a lot different, we didn't fly around as much, we didn't connect like we did before

we also couldn't work from home so you know the economic damage would have been quite different but also back then you were just coming out of a world war, whereas here we were sort of you know just normal in a sense, so again way different conditions but I think my biggest thing was and I've said this a lot of times after or sort of as we've moved through the pandemic

would I do a lot of the stuff that we did at the start yeah probably it was it was absolutely vital and it kept a lot more people in jobs it kept a lot more people in a way better position yeah but it's I think the issue in my mind is not what we did it's how quickly we decided to end it or how much we continued re-upping it we didn't cut it off quickly enough you know once you're once you've gone through and had you know a 20 pack of mcnuggets you don't go back and get a second and then a third and then a fourth you don't know me brad you don't know me then you'll get sick and it'll all turn bad you don't know my stomach, Brad. Interesting.

Interesting take on it all. So just to sum it up, because I know we've got to go, but things are not clear and bright and cheerful and all the way back to 2019 we can just obliviously live our lives, but there are some sort of brighter horizons out there. Yeah, I think this year it might well be a bit more stability, if you will, and I often talk about how- Is this good news? Is this good news? Is this better news?

Is this better news, Brad? Is this better news, Brad? This is sort of like, though, when you have a toddler, right, and you give them all that sugar money that we got through COVID and they run around and they're all hyper, hyper, hyper, like the economy's been, and then at some point they crash. They have a little bit of a tantrum. They have a little bit of a snooze on the ground.

That's where we find ourselves at the moment. Then eventually we'll rally again, but we've sort of got to get over that sugar rush first. Okay. I do love a sugar rush first. Okay. Well, semi good news, Brad. Thank you for bringing your semi good news in here, Brad. Jesus. Thanks so much.

We have such respect for you, as you can see.