When a countrys economy is of high value, a strong currency is not a disadvantage (Germany is an example of that). The problem of some of the new zealand farmers and exporters and their constant cries to lower the new zealand dollar to be able to export more is a symptom that the returns in agribusiness investments is not as high as expected, but not necessarily due to the strong currency but due to the overpriced land prices, the increasing energy costs and the tendency to decreasing returns inherent to capitalism. Personally I think its important for new zealands future to have a solid and strong currency and attract foreign high value investment while moving towards a less farming-based economy and towards a more technology-based and high added value economy. Hopefully then we get to decrease the huge environmental damage over-farming is causing. Rising interest rates is the right thing to do.
Posted on: Thu, 13 Mar 2014 09:56:21 +0000
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