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Ryan Bridge: House prices no longer lead economic growth · Early Edition with Ryan Bridge

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  Speaker 1: Ocr aside for a second. The Reserve Bank made very
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  Speaker 1: clear one thing yesterday where they think growth is going
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  Speaker 1: to come from in this country. As we've spoken about
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  Speaker 1: on the show lately, house prices aren't exactly running away
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  Speaker 1: here like they are in Australia bar Queenstown. In previous recoveries,
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  Speaker 1: that wealth effect kicks in. People go shopping with their
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  Speaker 1: house prices going up, they feel a bit richer and
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  Speaker 1: splash the cash. But this time the Bank says prices
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  Speaker 1: are going to stay flat, pick up again later this year,
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  Speaker 1: but only at the rate of income growth. In other words,
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  Speaker 1: the opposite of what we're used to over the past
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  Speaker 1: few decades. Usually, as anyone who's trying to buy a
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  Speaker 1: house will know, the price of a three bity in
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  Speaker 1: Auckland grows quicker than your salary. That's all changed now
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  Speaker 1: because we have more supply, at least that's according to
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  Speaker 1: the Bank yesterday. So without the tickle up, where does
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  Speaker 1: economic growth come from? For nz inc Arna Breman answered
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  Speaker 1: that question specifically yesterday and was very clear. Agricultural exports,
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  Speaker 1: tourism and more recently some signs of life and manufacturing.
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  Speaker 1: These are industries that bring us money from offshore, they
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  Speaker 1: grow the pie. They provide the basis for other sectors
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  Speaker 1: to pick up. If you're a farmer or a tourism
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  Speaker 1: operator in Queenstown Audo to do this morning, you should
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  Speaker 1: feel very proud of that, and we, through our government
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  Speaker 1: should support them. That means staying off their backs, letting
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  Speaker 1: them get on do what they do best, feeding the
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  Speaker 1: world and providing unforgettable experiences for visitors. On manufacturing, it
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  Speaker 1: is hard to ignore the energy debate. If we don't
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  Speaker 1: have a steady and reliable supply of electricity, trying to
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  Speaker 1: run a factory or a mill, as the Central North
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  Speaker 1: Arland has learnt the hard way just recently becomes very difficult.
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  Speaker 1: So while ALNNG coal for Huntley and methane target changes
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  Speaker 1: might sound bad, they're basically what ensure that we support
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  Speaker 1: the industries that support us. What the Reserve Bank said
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  Speaker 1: unequivocally yesterday is that without them there is no growth.
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  Speaker 1: Without growth, no new jobs. What does that do to tax,
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  Speaker 1: no new hospitals? You get the picture. This is not
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  Speaker 1: to say it's a perfect world. There are costs to
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  Speaker 1: not doing environmental stuff, but for them to work, you
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  Speaker 1: need the world on board and they're not. In the meantime,
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  Speaker 1: the question is whether we can afford to bite the
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  Speaker 1: economic hand that feeds us, and if you listen to
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  Speaker 1: the bank, it would appear that we can't. For more
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  Speaker 1: from Early Edition with Ryan Bridge, Listen live to News
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