More suggestions …

And some more

Other ideas include:
* $10,000 interest free loans to new house buyers;
* Government-funded crisis managers to help companies in strife;
* A fund from the sale of government bonds to add liquidity to the consumer finance market;
* Tax holidays for struggling businesses; and
* The Government offering loan guarantees to small and medium sized businesses.

Why give home buyers money? What is the social benefit from someone buying a house!

Are we actually facing a liquidity constraint in the consumer finance market? I didn’t think we were? Households have decide they WANT to cut back spending given uncertainty.

Guaranteeing loans?? Sure, that is a great way to make sure we get productive investment going 😛

Crisis help and tax holidays are potential goers – although, there would need to be more detail before I could say I agree with it.

Update: At 2.15 Bill English said NZer’s will decide whether this is a “talk-fest” or a “do-fest”. What he means is that NZer’s need to be adaptable because this is a permanent shift. This is true.

However, if the whole adjustment needs to be done by NZer’s, what is the point of this “talk-fest”? Note I call it a talk fest because he is practically saying that the adjustment needs to be done by people outside the meeting, and that policy can’t really help.

Update 2:  From here:

Those in the building industry have asked for subsidies for wood frame homes arguing it will boost both the construction and forestry sectors

The lobbyists are having a FIELD DAY!!!

4 replies
  1. Bill Bennett
    Bill Bennett says:

    There was a home buyer subsidy operating in Australia when I lived there. All it did was immediately raise the price of houses by the subsidy amount. Home owners got the benefit. It actually made things slightly harder for buyers because of things like stamp duty etc.

  2. Matt Nolan
    Matt Nolan says:

    Good point bill that is exactly what it does – it will just be a transfer from taxpayers to property owners.

    I am amazed at how bad some of the policy suggestions have been!

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