| Welcome to the August issue of the Select Wealth Management Dashboard Newsletter. The weekend saw the end of the FIFA Women's World Cup. What a fantastic tournament this has been. I'll be the first to admit that at the start of the competition, I was only vaguely interested. But as it wore on, I was drawn in and ended up really enjoying the whole thing. What a spectacle - and so incredibly well organised and run. How fortunate that New Zealand has been a part of this fantastic event, attracting thousands of international tourists (which gave a much needed shot in the arm to our hospitality industry). I'm sure there will be young girls all around the world inspired to get out there and play the beautiful game now - something that really excites me! It's just a good news story all round.
As the dust settles on the World Cup, the next major event comes into focus. No, I'm not talking about the Cricket World Cup in India which starts on the 5th of October (although I am very excited about this). I'm talking of course about the general election which is set for the 14th of October. The past few weeks has seen the campaign trail ramp up, with most Parties grabbing headlines where they can with various announcements. National plan to ban the use of mobile phones in schools, Labour plan to remove GST from fruit and veg, Act plan to do away with Co-Governance, and the Greens plan to make dental care free for everyone. These policies all stem from noble aspirations. My sense is that this election is going to be highly emotive. New Zealanders (much like the rest of the western world) seemed to have grown more divided with strong opinions on either side of the spectrum. Voter turn-out has been increasing over the past 4 elections, and I think this trend will continue as voters become increasingly motivated to give their party every chance of winning (or often just to ensure that the opposition lose).
At the beginning of the year, I predicted a very close election, but with Labour coming out on top with a coalition government. A lot has happened since then, and most polls now have National and Act with enough seats to form a majority coalition.  Click to view full image
Those of you who know me well enough will know that I am not a particularly politically motivated person. I believe that in New Zealand, most political parties are honest, not corrupt, and have sincere and noble intentions. Yes, we won't always agree with all the policy out there, but the fact is that no party will ever be able to accommodate every citizen's needs through policy - we are too diverse a population. One thing that does frustrate me though is when people vote without having a reasonable understanding of what policy they are voting for. Transparent policy comparisons are difficult to find, leading many people to vote based on 1 minute sound bytes they hear on the radio, hearsay from a friend, ideology, or from watching a chaotic TV debate. More often than not, this information is prejudiced and coming from a source with its own agenda. Media outlets often have a left or right leaning position and will package up their sound bytes to support this accordingly, so be weary of this - it leads to confirmation bias. I recently stumbled across this interest.co.nz/elections/2023 tool, which compares party policies. It's not perfect, but it's a useful resource for information. Hopefully there will be more of these as we near the election. In the meantime, I'm going to try find out as much as possible about various party policies from a variety of media sources. I'll try have a (civil) discussion with someone with an opposing view to mine and see if I can understand their perspective. I'll try learn a bit about various candidates and form a view on whether or not they are competent enough to actually execute their policy. And then who knows - I might actually vote this time... The markets have been soft over the past month with all share markets down. American markets were most resilient (down -1.70%) with Asian markets hardest hit (down -3.5%). The NZ$ weakened against all trading partners, down as much as 6% against the US$. Interest rates (both mortgage and deposit) remained steady, echoed by the Reserve Bank of New Zealand keeping the OCR at 5.50% last week. Consensus is that we are at the top of the interest rate cycle, but that rate cuts are some way off. Anecdotal evidence is starting to emerge supporting the idea that we may be at the bottom of the housing market too - something everyone is keeping an eye on. Here are the numbers for the past 30 days: |
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There is nothing specific to report in terms of your Select Wealth Management portfolio. I have been frustrated by the performance of fixed interest investments over the past 6 months, but the end of the interest rate cycle bodes very well for this asset class in the medium to longer term. The outlook for fixed interest is better now than it has been for nearly 15 years - a fundamental that gives me great confidence for our portfolios moving forward. Finally, a quick update on our Giving Back program. We delivered some coffee machines to the wonderful nurses at the Hutt Hospital recently. This was an incredibly humbling experience. I was blown away at how genuinely grateful these people were over such a simple gesture. It was an eye opener to see their working conditions, and how little gratitude these heroes are shown. It was awesome to be able to do something nice for them. Our campaign for the Billy Graham Youth Foundation has started well, and we have until the end of the year to raise as much as possible for this great cause. As always, thank you for the introduction to your family and friends which enables us to keep this program running. To keep track of the Giving Back program visit https://mifinancialplanning.co.nz/giving-back.html That's all for now. Chat again soon Warm regards Dave and the team at Makowem & Isaacs Financial Planning dave@mifinancialplanning.co.nz |
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This newsletter is intended for general distribution and does not constitute personal financial advice.