Opposition leader Christopher Luxon has ruffled some feathers recently with comments regarding New Zealand being a “negative, wet, whiny, inward-looking country.”[i]
In defence of having a whinge, there has certainly been enough bad news to fill the coffers in recent times. To some it will have felt like three years of constant whammies, from covid to the cost-of-living crisis (and all the associated pains) and then to cap it off a devastating cyclone.
Is he wrong? Are we too negative and introspective? It’s hard to make that call quantitatively; though, our proclivity to show approval by saying something is “not bad” rather than “good” may be a hint into a wider glass-half-empty mindset. As an aside… when I was writing this article, I did come across a Herald piece from 2000[ii] discussing the same kind of negative sentiment held by New Zealanders (and that we are usually the first ones to make negative statements about our own country). Make of that what you will.
According to Hanke’s Annual Misery Index – yes, that is a thing – we’re getting progressively less happy since 2020. Steve Hanke, professor of Applied Economics at Johns Hopkins University, created a system to measure a country’s unhappiness based on a series of factors like unemployment, inflation, bank lending rates, and the annual percentage change in real GDP per capita. It’s economic data, but highly indicative of hard times – which tend to harsh the mood in a more anecdotal sense.[iii]
To be sure, we are not the only country feeling the pinch in 2023. If one held a mirror to Sweden’s economic headlines, you could mistake the reflection for New Zealand.
While they quickly bounced back from the pandemic and had record low unemployment, a very expansionary economic policy quickly led to the Swedish economy being overheated. Their housing market has taken a tumble, and they have been facing larger-than-anticipated GDP contraction in the ensuing slow down – which they have attempted to combat with rate rises. [iv]
Sounds familiar…
Kiwis tend to look at New Zealand through a negative lens in comparison with other places. There seems to be a deep-seated belief held that certain problems only exist or are worse in New Zealand. The reality is that things can be just as bad overseas.
Take Australia for example. The Lucky Country is facing a cost-of-living crisis of their own, with rising rents and low-paid work leading to frequent reports of younger or less financially secure folks (those on disability benefits, for example) having to go without things ranging from even the cheapest social activities to essentials like food, therapies, or medication – and rent.[v]
Those hoping to hop the ditch for greener grass may find that the reality is not so sweet. Perhaps, after years of not being able to travel and having fewer foreign visitors to our shores, some Kiwis have convinced themselves that a barrier to happiness or a bright future is simply being here.
To quote a proverb from our Swedish friends: In spring, no one thinks of the snow that fell last year. While it is undoubtedly painful now, we will eventually see the end of this economic season in favour of more a milder economic clime.
For those nervously watching investments in this time of local and global economic uncertainty, remember that now is not the time to switch things up out of fear. If you have a well balanced, globally diversified portfolio with the right mix of asset classes, you need not worry about any country, industry, or unprecedented historical event (as alarmingly common as they seem to be these days…) causing issues with your long-term accumulation plans.
If you are worried about your plan, or want a second opinion, the best course of action is to have a chat with a local, trusted fiduciary – not to hop a plane and hope for the best.
by Nick Stewart (CEO and Financial Adviser at Stewart Group)
· Nick Stewart (Ngāi Tahu, Ngāti Huirapa, Ngāti Māmoe, Ngāti Waitaha) is a Financial Adviser and CEO at Stewart Group, a Hawke's Bay-based CEFEX & BCorp certified financial planning and advisory firm. Stewart Group provides personal fiduciary services, Wealth Management, Risk Insurance & KiwiSaver scheme solutions. Article no. 322.
· The information provided, or any opinions expressed in this article, are of a general nature only and should not be construed or relied on as a recommendation to invest in a financial product or class of financial products. You should seek financial advice specific to your circumstances from a Financial Adviser before making any financial decisions. A disclosure statement can be obtained free of charge by calling 0800 878 961 or visit our website, www.stewartgroup.co.nz
[i] https://www.thepost.co.nz/a/nz-news/350021413/new-zealands-negativity-problem
[ii] https://www.nzherald.co.nz/nz/disparaging-kiwi-attitude-may-not-help-our-economy/YPTWMX3PLRLQZB7OPPTOOJ7P34/
[iii] https://www.thepost.co.nz/a/nz-news/350021413/new-zealands-negativity-problem
[iv] https://www.nordea.com/en/news/tough-times-for-swedens-economy
[v] https://www.theguardian.com/australia-news/2023/sep/03/cost-of-living-crisis-price-rises-increases
