Latest / The Curve / TCW96: How Trump’s new tariffs could break your wallet.

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TCW96: How Trump’s new tariffs could break your wallet. · The Curve

• 0:00
  Welcome to the Curve Weekly, the podcast that keeps you up to date with all of the money
• 0:04
  business and stock market too. Brought to you by the Curve's research team,
• 0:07
  it's the latest insights on what's happening in the stock market, companies,
• 0:11
  other money related news so that you can stay educated and ahead of the curve.
• 0:15
  You can thank us later for sounding smarter than those finance bros you need to know, Patti.
• 0:19
  How's your weekend? Good, I had a very short weekend, I'm recovering from a cold,
• 0:24
  hence the kind of tail end of sounding like a man. You actually sound okay.
• 0:29
  Energetically, I feel fantastic. Do you? Oh, shit, yeah. Yeah.
• 0:34
  Because Friday was a bit dire, wasn't it? Everyone in the office was going down like flies.
• 0:38
  Yes, honestly, it was like, woke up, and then Danny text, and then you were like, I'm sick,
• 0:42
  and then I was sick, and then it was like, oh gosh, but we're not in like,
• 0:46
  echinasia and vitamin C that I've had in the last 72 hours.
• 0:50
  Well, when you get an Arctic polar blast, it's like, all of us Kiwis are like,
• 0:56
  I would like to say it's snowed last week, but everyone's been calling it sleet.
• 1:00
  I'm like, I saw snowflakes, it was snowing. It's like snow and antics.
• 1:05
  Oh, shit. Basically, that's why everyone got cold, because it was all of us, I don't like one degree.
• 1:09
  Yeah, like literally like that. Yeah, cold snow. But also the brain fog is real.
• 1:14
  I feel like I have brain fog in my life every day. It kind of makes me think like, is this
• 1:18
  what I'm going to be like when I'm pregnant? You know how what was it? Where did you notice it?
• 1:22
  Just like trying to talk or saying the wrong things or what about remembering things?
• 1:27
  Not remembering, it's just more like, I remember being in a meeting with Danny and we were both
• 1:31
  just like, couldn't like, just couldn't get your words out, couldn't get your train of thought.
• 1:36
  It was just, everything was really hard. Okay, interesting. And I don't know if that's what pregnant
• 1:41
  woman feel like, but I know there is, you know, that whole pregnancy brain, baby brain,
• 1:47
  because your body is all focused on making a human that is sucking energy and resources away
• 1:53
  from other parts of your body. I mean, do you know what I must say? I think the most adult thing I've
• 1:56
  done in the last probably six months. Was the rave that you went to on Friday? No, not that.
• 2:01
  That was fun though. No, on Monday, when I started to feel myself getting sick, you know, and you
• 2:06
  feel like you've been hit by a train and you're like, oh, I'm so tired. I actually left filming,
• 2:13
  like we were still filming and I was like, I've got to go home. I honestly thought you had the
• 2:16
  shits or something. You were like, we had 20 minutes to go and she's like, I've got to go. I'm
• 2:20
  really sorry. And I was like, okay, bye. I mean, the person that was with us, they were like, is she
• 2:27
  okay? And I was like, I don't know. It was quite sad. It was really saddened. No, I've been thinking
• 2:31
  about it for about 20 minutes before that. And I was like, I can do it. I can do it. I'm just
• 2:35
  going to 1230 and then I couldn't. And I went home and I slept for four hours. And I think that's
• 2:42
  why I didn't get sick. But you know, the funniest thing I love, I love you, because you like
• 2:47
  woke up after the four hours and called me and you were like, hey, then, I just think I just had
• 2:51
  the best, I just did the best thing. I just, you know, I felt like I was getting sick so I went
• 2:56
  home and I slept for four hours and now it means I don't have to, like, it won't impact work.
• 3:02
  I was like, you slept through the day. I was like, you just slept for a while. I was like, I kind of
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  was like, I was like, you know, I love your analogy, like your rationality, your rationality.
• 3:13
  No, no, but it was one day, right? No, rather than what would have honestly, because I'm useless
• 3:17
  when I'm sick. It's like a week and a half and I'm just like, red-nosed, embarrassing. And I think,
• 3:24
  yes, one day, bad. But anyway, I actually think, so I've got given these CBD drops, which
• 3:32
  for like your immune system. Yeah. And I, it doesn't have any instructions on it about what time
• 3:37
  of day you should take it. And I took quite a lot of it on the Monday because you guys were all
• 3:42
  getting sick. And I came to work like, that's what happened. Maybe I went home, that's why I had such a
• 3:49
  weird long sleep was because I had had CBD. Maybe. Yeah. You should take that before you go to sleep,
• 3:54
  not before you go to work. Yeah. Wow. Got you. Okay. That's why I think that's what happened.
• 3:59
  So I hope that's why all of a sudden, I was like, no, no, I'm going to fall asleep. I'm literally
• 4:03
  going to fall asleep right now. I don't. Oh, please don't drive a car or anything like that.
• 4:08
  Or, you know, use any heavy machinery. Oh, quickly, before we get onto the stock market and,
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  you know, business money news, you know, last week, how I said I'd done a bit of a deep dive on
• 4:19
  my finances. And I'd separate it out my like money. But you can get virtual cards for like different
• 4:26
  pots or monzo, which is what I use. And I've been doing it. I kind of was skeptical. If I was going
• 4:33
  to do all this work and then it was just going to be the classic like, oh, see, I forgot to track
• 4:39
  with. Anyway, every time I go to spend something, I'm like, do I need this or do I want this? And I
• 4:43
  get out my, either my essentials card or my non essentials card. And it's been working. Nice.
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  I've all of a sudden got more money than I ever thought because I'm actually aware of what's
• 4:54
  going out. Love there. I know that sounds so obvious, but anyway, it's been quite a
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  revelation for me. Yeah, we go through all that in this new course we're launching. Oh, yeah,
• 5:03
  yeah, yeah, yeah. Are we allowed to talk about it? It's coming out like a week for the UK. So,
• 5:07
  if you're in the UK, you can know about it. It's probably about, I would say, starting next year
• 5:11
  for New Zealand. Yeah, but you can, we got early bird. Oh, yeah, we don't. Yeah, you can find it
• 5:15
  on our website. We'll put a link in the forecast show notes. It's a lot, I don't know.
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  And we love to say this. Do late. I also started a little fund. Oh, what? Well, you know,
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  when you're sick and you're just like, you think, I should really be eating healthy and fueling
• 5:32
  my body and all of that. And I really don't. Like majority of the time I really don't. You do. I
• 5:37
  don't. I do have like blowout. Only sometimes. I would say 90% of the time we're really good.
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  But I'm just, I'm very tempted to be like, oh, I'll just get a croissant or, oh, I'll just get
• 5:49
  a burger. That's fine. Every now and again. No, but this is the thing. It's like, it's a lot.
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  Anyway, I was like, I really need to focus on eating, fueling my body and eating, eating nutritious
• 6:01
  whole foods rather than defaulting for takeaways or whatever. Yeah. So I started like a healthy eating
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  fund. Nice. So every time I want to go and get a coffee and a croissant and I don't get the
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  croissant, I transfer the money that I would spend on the unhealthy food. Nice.
• 6:15
  Into a little fund. Mm-hmm. Love that. It's got five pounds in it.
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  This weekend. Where did you avoid the croissant? I think it was last weekend.
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  Yeah. So one day. One day. One day. Yeah. Nice. Yeah. And so what's going to happen with
• 6:29
  you all right in the weekend? I got like a burger and fried. No, I know. And I just
• 6:36
  remember being like, oh, my poor fund. No. That's not going to grow. I disagree. I think this
• 6:41
  is a good fund for you to have a fun little croissant fund. Yeah. But I think that for the most part,
• 6:46
  you've got random chopped salad by your desk or like some tuna, cucumber, but you know, that's
• 6:52
  just a little initiative. Nice. I love it innovative way. It's a good way actually to start
• 6:57
  encouraging good behaviour. Yes. Yeah. Whether it's the way that you eat, whether it's the way
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  that you exercise, because I used to have like a morning workout fund as well every time I do that.
• 7:07
  That's right. Yeah. And then it's just like, then now it's just like a non-negotiable,
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  so I can stop doing that and I can contribute something else. Oh, thank you. So way of like
• 7:14
  getting into a habit. Getting into a habit and then it becomes sick in nature and you don't
• 7:17
  have to think about it anymore and then you start contributing something else and something else.
• 7:20
  Maybe I should do that my meditation fund. Yeah. That's actually a really good idea. So every day,
• 7:24
  I transfer five pounds if I do it. Yeah. News news news. So, I honestly was so sick of saying his
• 7:32
  name. Trump, Trump, Trump. He started to introduce policies already, which I thought he wasn't even
• 7:38
  brilliant. He's not inaugurated yet. No, but he can start putting the wheels in motion. So he
• 7:45
  is announced a 10% tariff on goods from China into the US. Could you explain the tariff? I'm
• 7:51
  getting there. Just dropping the gun. I was just jumping the gun. Jumping the gun.
• 7:57
  So yes, he has announced 10% tariff on goods from China and 25% on all products from
• 8:02
  Mexico and Canada. So China, Mexico and Canada. It's kind of like a like a tax expertise. Yeah.
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  Tariffs essentially make the products more expensive. So the biggest imports from China to the US
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  is things like machinery, electronics. So a lot of things that go into like cars, laptops,
• 8:22
  phones, all of that comes from China into into the US. And manufacturing the US, for example, needs
• 8:27
  apart from China. It's now going to cost 25% more. Shit, that's a lot more. Who do you think
• 8:32
  ends up paying that? Customers. Yeah. Because it's like, okay, well, this laptop that I'm making now
• 8:37
  is going to be 25% more expensive as a producer, as a manufacturer. I'm just going to pass that
• 8:41
  on to the consumer. What it is supposed to encourage is those manufacturers to look locally and be
• 8:47
  like, imported goods are more expensive. So let's look locally and see if we can find something.
• 8:51
  There might be a little bit more expensive, but not as expensive as it is. I understand the
• 8:56
  idea of it, but it just leads to higher inflation and higher prices, which would just come out of
• 9:02
  this whole super high inflation cycle. So is there not a world in which you can find more local
• 9:08
  alternatives or no. The whole preface of economics is that globalization is great. It's great for
• 9:14
  consumers. It's great for world productivity, for economic growth, because everyone is doing
• 9:20
  their bit the best they can. And we're all joining forces to provide products and services the best
• 9:26
  that our countries can. Whereas this is very much going, no, no, stay out of stay out of the US.
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  We can do everything really, really great, even if it means more expensive.
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  Trump is trying to make it seem like he is being all for America by collecting everything
• 9:42
  back into the States, but what he's actually doing without people realising it is going to be
• 9:48
  bringing inflation up, which means everything's going to be more expensive.
• 9:51
  Yes, and this is the thing people voted for him because they were like, yeah, make America
• 9:55
  great again. And tariffs are always a political debate, but what you should think tariffs
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  exactly that. It's taxes. It's taxes on goods that you use all day, every day, that you buy,
• 10:08
  that you're just going to end up paying more for. So it's like you might be like, yeah, yeah,
• 10:12
  America, make America great, but it's you end up paying. So it's kind of, it's absolutely
• 10:20
  stupid. And it's like economics 101 is that trade wars are terrible trade wars. So this is what's
• 10:27
  happened now in China's going to China's coming back and going, okay, well, if you're going to
• 10:31
  slap 25% on goods coming into America, we're going to slap 50, 100% on any, and it's just
• 10:39
  like a big dick competition. People have asked Trump, okay, why are you doing this? If it's just
• 10:42
  going to lead to higher prices. And he said it's to clamp down on migrants and illegal drugs that
• 10:48
  come into the US. He's saying it's like a retaliation. It's like Canada, Mexico, you all, you all
• 10:54
  send illegal drugs and immigrants to the US. So I'm going to slap this tariff on you. So he's
• 11:00
  doing actually like, it's like a tip attack. He's not thinking about the actual repercussions of,
• 11:06
  okay, well, high inflation, that means cost of living crisis, that means that that's higher,
• 11:10
  that's higher interest rates, which means higher mortgages, which means lower health prices,
• 11:15
  which like everything's related. It's honestly. So do you think because what we've seen is the
• 11:20
  stock market, absolutely skyrocket, that's from the taxes cuts, that he was going to introduce
• 11:28
  for corporates. So there was going to be tax cuts, which means more profits, which means higher
• 11:33
  share prices. That's why the stock market really has done so well. But do you think there's also
• 11:38
  something to do with the dream of what they think Trump is going to be bringing? And then when the
• 11:42
  reality sinks in potentially in, you know, six months and they see the flow-ons of these tariffs,
• 11:48
  the people might actually start to be like, oh gosh, this is actually really not good for
• 11:54
  the economy. And the industries that are most impacted by these tariffs,
• 11:57
  their share prices haven't done well. So like manufacturers, so the auto industry has done
• 12:03
  terribly. The auto industry, automobile, car industry. I feel like, I'm not sure if it's
• 12:09
  that you're sick, but I feel like you're speaking very fast. Yes, no, I got it the third time,
• 12:14
  but I was like, what? I don't. I don't know. Do I sound okay? You sound okay.
• 12:24
  You definitely don't sound 100% but you sound a bit nasally, don't I? Yeah, I can tell.
• 12:29
  It's coming out. Sorry, but it's more of so now. Yeah, thank you. My mum always says I speak
• 12:34
  really fast. So I'm like, Mum, we have like 50,000 losses of the podcast and you're the only one
• 12:38
  that says I speak fast. I lane, I'm with you. Yeah. Today. Today only. I put you on 1.5 times,
• 12:43
  you speak so slow. Do you? Yeah. Right. I think she said I'll join that to you,
• 12:47
  Turf makes. And I did with another friend and I was like, whoa, whoa, whoa, whoa, she speaks so
• 12:50
  fast. Really? And I was like, oh, sorry, sorry, that's right. I had a speaking. But it's such a good
• 12:54
  hack. Yeah, efficiency. I must say, I used to be very offended. You did that and now I do it to
• 13:00
  most people. Yeah. But the key learning from this is that if we head back into a high inflation
• 13:08
  state because of this, one thing to make sure with your savings is that you don't have it in the
• 13:16
  bank. Yes. Because if you have your money in the bank. And by bank, we mean like transaction
• 13:23
  everyday account. You need to make sure at the very least you have it in a high interest savings
• 13:28
  account. Yeah. We're termed a positive or something like that, something that's growing.
• 13:32
  And the reason for that is let's say inflation's at 8%. It means that a few go to the supermarket
• 13:40
  and you would buy five things. You had butter, cheese, bread, milk,
• 13:45
  pasta, no, no, yeah, all the dairy and a little bit of gluten would like a hundred dollars.
• 13:51
  You only made it to the dairy aisle. Or a hundred pounds. Then if inflation's at 8%, it means
• 13:59
  that the same amount of money a year later, everything's 8% more expensive. So you might only be
• 14:05
  able to get like four things with the same amount of money. So you basically, if you have your
• 14:09
  money in the bank, you want it to be getting an interest of a minimum at the same rate as inflation.
• 14:15
  Yeah. Otherwise you're losing money. It's like the purchasing power or what you can afford.
• 14:19
  So the power of your money goes less far because you can purchase it. Did you know supermarkets?
• 14:26
  They put all the necessities at the end at all different spots of supermarkets,
• 14:33
  so you have to go all the way around. So if you wanted bread, milk, eggs,
• 14:40
  why are we struggling so much? If we both got brain fog, like what's happening?
• 14:44
  Serial. Serial, yeah. They're all in different sections. I'm kind of like fair play.
• 14:50
  Because I'm going to go around and get everything I don't need. I think if you know this system,
• 14:54
  you can hack it. Like if I owned a shop and I knew that you were wanted to buy, you're not going
• 14:58
  to put them right at the entrance. No, they ended out. Anyway, I have a new and
• 15:03
  interesting idea for you. There's a saying and I know you don't really get it, but I'm hoping
• 15:08
  that you're going to get it after this. Is it your shitty quote? No. This one is a more
• 15:12
  imbuffet one that says it says blood on the streets. Yeah, but I'm just blood on the streets.
• 15:16
  And what that means, it's quite aggressive. It sounds like we're in the media for too long.
• 15:20
  There's another one. There's another one. It's kind of something low, which is
• 15:23
  by low sell high. Kind of. Yeah. Yeah. That's better. Yeah. By low sell high.
• 15:27
  Is it that one or what? Be greedy when everyone is fearful and fearful when everyone's greedy.
• 15:31
  And this is kind of what's happening at the moment. Like the market has done so well
• 15:36
  that everyone's getting greedy. Everyone's like, oh, I need to invest. I need to invest. Oh,
• 15:38
  I need to buy Bitcoin. Oh, I'm doing that. Oh, my God. I'm the Bitcoin queues to have a taxi driver
• 15:46
  test at work in the olden days when I was a portfolio. In the olden days,
• 15:51
  good Lord. It's been a year and a half. It was like if taxi drivers are talking to you about
• 15:56
  Bitcoin or about NVIDIA or some kind of stock, that's when you sell. Because you know that it's
• 16:01
  reached the masses. There's no more people to buy that. Oh, that makes way more sense when you
• 16:07
  say it like that. Yeah. It kind of plays into this, yeah, be fearful when others are greedy and
• 16:11
  greedy and it was fearful. Right now, there's one region that people are fearful or people
• 16:19
  they're like, they're not right. So it's what we call emerging markets. Okay. And it's a group of
• 16:24
  companies. So it's like Brazil, China, just China emerging. Yeah, very developing, emerging. It's
• 16:30
  kind of wow. India, Greece, Egypt. Right. There's lots of countries in there and it's because you've
• 16:36
  got the emerging markets. You've got the developed markets. That's how and developed markets would
• 16:39
  be like UK, the US, Australia. Okay. So the big thing. Yeah. Yeah. Yeah. And it's all determined
• 16:48
  by things about GDP. So like how much the country produces, standard of living, financial system,
• 16:54
  like there's a whole lot of metrics that they do to try and kind of clarify them. The emerging
• 16:58
  market index. So. Oh, great idea. Yeah. So this has is absolutely in the gutter. Like it is
• 17:06
  delivered 4% per year over the last five years versus the US stock market, which is like on
• 17:14
  average about 15% over the last five years. It's absolutely like just tanked. Just had 4% growth.
• 17:21
  It's like, isn't it? Have you get that? You can get that in term deposit. Do you know why I take
• 17:25
  the risk and invest in stocks? If I can get that in a term deposit, which is way less risky.
• 17:29
  I love this. Yeah. So I want to show it to my friends. Index has not been this low since 1975.
• 17:39
  Whoa. I look at this and I go, the probability of that index falling, say another 20%.
• 17:46
  I'm just pulling for centuries out of my head, but it's probably pretty low. The probability
• 17:51
  that going up 20% is a lot higher in my opinion because of where it is at the moment.
• 17:58
  This is a fun game. Yeah. And a great idea. And you can see from this graph, it goes in cycles.
• 18:04
  We zoom for another cycle. Ooh. So where do I get it? What's the, what is it? So the ETF is the
• 18:12
  I shares, MSCI emerging market ETF. This is lots of, lots of job and that kind of site it.
• 18:19
  And it's such a good idea. And it's known as its ticker code is EEM. Investing in stocks does come
• 18:23
  with risk and emerging markets in particular. But what we've seen out of China lately with
• 18:28
  the government spending a lot of money to boost that economy is good for this index because
• 18:34
  it's a large part of the index. Yeah, there's lots of, lots of things going on. But yeah, if you've
• 18:38
  never invested before and you hear this and you think, hmm, maybe this is a good opportunity.
• 18:44
  Don't do what I did when I first started and thank God I had a Victoria to message, but I
• 18:48
  was like, I'm going to put, I think it was honestly maybe five grand. I wanted to put
• 18:52
  in New Zealand because I had no context as to how much that was. I should have seen something.
• 18:57
  And it was like, I wouldn't do that much. I was like, hey, well, what about 500? It's still
• 19:01
  think that's a lot. So I ended up doing like a hundred, which was way more reasonable.
• 19:05
  If you're excited about this, but you don't invest a lot or you know, it might be like a new
• 19:10
  idea for you, just go little, little amounts. Honestly, even like 20 pounds, $20,
• 19:15
  like just so that you can see what happens. It could be a good learning curve, learning curve,
• 19:22
  literally, but hopefully it's curving upwards. Yeah. And it is well diversified as well,
• 19:27
  because it's an ETF, which means you're not only buying one company or one share and one company,
• 19:33
  you're buying, you're getting access to it, a whole lot of countries, a whole lot of companies,
• 19:37
  it's a really well diversified ETF. Cool. Love that idea. Also, do you like my new
• 19:42
  area? Well, I'm just wondering where are you wearing one? There's two. Well, why are they on the same
• 19:48
  air? Because that's the look. Oh, three months. No, but I've been serious. It's like,
• 19:53
  I even got ripped jeans. I know, but you've got one giant area. It looks very lopsided.
• 19:58
  Is it meant to? Yeah, I like it. No, I really like it. Thank you. No one do you want to swap seats,
• 20:02
  though? You wanted to have your ear towards the camera. I've been so present.
• 20:07
  From my sister, Jasmine Sparrow, Erin. Yeah, I love it. Oh, jewellery, so good. Love Jasmine.
• 20:12
  Love Jasmine Sparrow. Oh, do you know what? Sorry, just while we're doing like Kiwi Brands that we
• 20:17
  love, this is totally unrelated to your earring or anything. Do you know what has been the best
• 20:21
  investment in my skin ever? Yeah, I thought you were going to say Sam and Sparrow.
• 20:29
  Oh my god, everything Sam and Sparrow in their face, by the way, in case you don't want to know. My
• 20:32
  friend looked into getting an Amsterdam because she's going there for a holiday and she asked a friend
• 20:37
  who loves their hate. Do they do it in Amsterdam and what's the price? And is it cheap? Should I wait
• 20:41
  till then? And free reply go. Yeah, it's way cheaper, but it's trout sperm. Not a serum. What the hell?
• 20:48
  It's like the, they were like bristles. So weird. Okay, anyway, um, Emelo Shum, I've been using her
• 20:54
  serum. We all know I've struggled with that, can you? Yeah. How good is my skin looking right now?
• 20:58
  I don't know. Yeah, I mean, there's a, I know there's one on my chin. I didn't think you could have
• 21:03
  it had one in ages. You know, I've gone through puberty. You're about to go through menopause.
• 21:06
  Oh, so menopause now? No, I know that, um, it's the blemish serum. Anyway, put it on my,
• 21:13
  fit on my Instagram a while ago, being like, I swear by this, so many people message me, being like,
• 21:19
  I'm going to buy it right now. You know, we should get that time. Um, interest rates?
• 21:22
  Yes, no.
• 21:27
  It's your reaction. She's like, yeah, I'm in a deep, like, part of your nose.
• 21:31
  It was time with her laugh and there's a lot. Um, interest rates at New Zealand. I am over the
• 21:38
  moon. Okay, tell me. So I have a house and a New Zealand. Here are 2,000.
• 21:44
  I have 2,000. And I am very, very stoked that mortgage rates are dropping. Like,
• 21:51
  hellelujah, this has been the longest couple of years of high interest rates. I'm like, yeah,
• 21:56
  it's been, like, it's been, yeah. And so, um, keep dropping, keep it falling, love it.
• 22:02
  So when it's falling and when it's high, are you essentially all the money you're putting towards
• 22:07
  your mortgage? It's just basic purchase interest. You're not actually paying your principal,
• 22:11
  like the actual mortgage. You can choose, but you usually, you pay principal and interest.
• 22:15
  So the amount of increases, does that make sense? Yeah, but I mean, if the interest rate,
• 22:20
  I remember at all point, your interest was like 60,000 a year or something. Yeah. When it's that high,
• 22:25
  you're basically just paying your interest. You can, you can go into something. Yeah. But most banks
• 22:31
  don't really like that, because they want you to be paying back your dues. So people could have
• 22:34
  afford more than that. I know, that's why it's actually a lot of people go into something,
• 22:38
  but then you're debts. It's like a pre-payment. You're just paying the interest. You're not actually
• 22:42
  paying anything. Yeah, that's right. So it's like for a long people who've had to go to just paying
• 22:46
  their interest. They're not really getting a hit with their paying their loan. Yeah. But you'll
• 22:51
  still get them a capital game from the property price and increasing. So your interest is just like,
• 22:58
  it's just paying itself. And hopefully you're getting some capital game. House price is going up,
• 23:02
  but if your house price is going down and you're paying for it, that's not all about that. But yeah,
• 23:07
  anyway, New Zealand has now one of the most aggressive interest rate cutting policies in the Western
• 23:13
  world. Shit, yeah. Yeah. Yeah. Yeah. Watch. That's good. That was my reaction. I was like, yeah, yeah.
• 23:20
  What is it named? So the reason we do is because the economy isn't doing very well. So remember,
• 23:26
  if interest rates are falling, that means it's much cheaper to borrow debt for companies, for example.
• 23:32
  So then they can grow. They're more productive. It's cheaper. That's right. It means we're more
• 23:38
  encouraged to spend because we're not getting as much money. I'm sorry, we're not getting as much
• 23:42
  return from any of the bank because savings rates are dropping. So when we had the global financial
• 23:48
  crisis and the whole world was kind of in turmoil, there was a worldwide, huge cut in interest
• 23:57
  rates because people wanted, because they were like, oh dear God, this is going to affect the economy
• 24:01
  and we need the economies to be firing on all sorts of things kind of thing. So this is like, oh,
• 24:07
  the economy in New Zealand doesn't look too good. We need to reduce interest rates to encourage
• 24:11
  companies to spend. We need to encourage people to spend. We need to help boost the economy. So
• 24:17
  while it is good in one sense, it's kind of the reasoning is not good. But it would be worse if
• 24:23
  we hadn't increased interest rates because we have no lever to pull. Does that make sense? Yeah.
• 24:28
  So we're kind of in a good position. Is that problem that if they bring them down, like they're
• 24:32
  just suggested and then the economy is still shitting itself? Well, yeah, then you have to look at
• 24:36
  alternative measures. For people overseas who don't own property in New Zealand if they're wanting
• 24:42
  to buy a property in New Zealand, because New Zealand property has for a long time done really,
• 24:49
  really well. Yeah. What are the risks for the property market if the overarching economy is
• 24:54
  starting to do really badly? If the economy is doing badly then that means that businesses won't do
• 25:00
  well because if you think people aren't out about spending money, so there are store closures,
• 25:05
  companies laying off staff, more unemployment, there'd be less people immigrating, so there's been
• 25:12
  one in to move to New Zealand. So you've got less new people coming in to spend money because they're
• 25:16
  like, oh, I've got Australia where the economy is doing up there, but economies that do move in cycles.
• 25:22
  So eventually it gets to a point where maybe the unemployment is really high, so wages have come
• 25:30
  down and then companies can now hire people because wages are so low and then the economy
• 25:36
  is better and people start spending money. So it all kind of works in cycles and we're kind of in
• 25:41
  this cycle where it's not very good, but it's just New Zealand and they're just pulling this
• 25:48
  lever to see, okay, well this means the house price going crazy people feel wealthy because they've
• 25:53
  got a lot of value in their houses. So there's certain things you can pull that could save it?
• 25:59
  It's quite interesting that New Zealand property has always done so well, and yet to be honest,
• 26:04
  most people don't move to New Zealand. Most people move away from New Zealand.
• 26:08
  Well it's capital gains tax, we're only going to capital gains tax, so you can come by a house
• 26:16
  and ship it. That's great, that's my property price. And Kiwis everyone can take up Kiwis everywhere
• 26:21
  to purchase the house. There's so many things in the government today that influence a really good
• 26:26
  healthy property market. How's your property buying? I was just about to say, I am going to buy
• 26:32
  with a friend. No, we're done a whole lot, which actually I should make sure we ask each other
• 26:37
  like 10 questions to make sure we're on the same page, we're like how long do you plan on having
• 26:41
  invested? What happens if that happens? What happens if that happens? It's quite intense to talk
• 26:46
  about because like, and actually what I thought was one of my brilliant suggestions was because
• 26:50
  obviously there's maintenance with the house, especially if you're buying an investment property,
• 26:54
  and you need to make sure it's, you know, if there's people living in a bit, it's in good shape,
• 26:58
  that I suggested, okay well maybe both of us put certain percentage or amount. So it's equal
• 27:05
  into a shared high interest savings account and fund for maintenance. So when it comes up,
• 27:11
  we prioritise what we collectively can afford based on what we've put in there. Because otherwise
• 27:16
  we may have one person saying we need a new roof and the other person's like well I can't afford it.
• 27:20
  Or I don't think that's priority. Like I think the new carpeters or something. So that's like if
• 27:24
  you have a shared amount that you're putting into, that's what you use to pay for maintenance,
• 27:29
  based on what you can afford to use. And I was like that's quite a clever. I actually even saw
• 27:33
  an Instagram post I think someone sent it to our curve team and it was about how people are trying
• 27:39
  to make buying property kind of less something you do as a commenter. Yeah, which I really liked.
• 27:47
  It was like couples putting mortgages before marriage. Oh yes, it's a monster journal. Yeah,
• 27:54
  it's just the idea of like unmarried buyers, prioritising financial freedom over a legal one,
• 27:59
  and the idea of like couples always trying to buy property first before they get married. But
• 28:04
  equally I think the idea of trying to reach financial independence or freedom whether you're
• 28:11
  in a relationship or not. I mean I hate this idea that you need to wait to be in a relationship
• 28:16
  where you can't do it if you're in love. Like it's a business deal and you should be approaching
• 28:21
  it in that same way. So I think it's an investment and it's like you can invest in businesses,
• 28:26
  you know, we've invested in this business. Yeah, you know, like you can, it's a transaction.
• 28:31
  The key thing is just making sure that you've got good contracts. The other thing that I've
• 28:36
  thought about, and I don't know if this is a clever idea, but I think it is. Yeah, don't want to have
• 28:41
  all of my money in property. Like I want to have a decent amount of it and property, but I don't
• 28:46
  want to have all of it. And so if I go in with someone, I can still put a decent amount in and
• 28:51
  afford to get a house and do it up and whatever. But it's not like everything. And I also think
• 28:56
  when you're in a startup, it's not like we're working for a big giant corporate. Like I want to
• 29:00
  have a decent buff of money. It's really great. So I'm really excited. So I mean, yeah, because we're
• 29:05
  going home to New Zealand in like a month, I think it's a good time. You know, I can, like,
• 29:10
  you know, I can kind of be amongst it. But I think also the reason people are buying houses together
• 29:15
  is it's a function of just house prices getting so expensive and unattainable for a lot of people.
• 29:22
  It's so hard to buy a house yourself on a single salary, live alone woman that you've played with
• 29:30
  the men. You know, there's far less woman being able to buy it because of house prices as well.
• 29:35
  What I don't understand is why it's so much easier to buy when you're in a couple than if you're not.
• 29:39
  It kind of annoys me because for example, for us, like all of the galaxies and things,
• 29:45
  we're talking places quite different if we were in a relationship. And I went to this talk last
• 29:50
  week that was talking about how in society, you know, and socially, we really, really
• 29:56
  pedestal romantic relationships and friendships and they, for everything, from like how much time
• 30:01
  you could take off from a bereavement standpoint at work and a friend dies versus have your partner
• 30:06
  dies or a family. We're kind of told that there's this real pinnacle which is romantic love,
• 30:13
  which is a relationship sense. But actually, we don't prioritise or pedestal our friendships
• 30:18
  or our relationship. So other family whatever in the same way. And so I kind of like the idea of
• 30:24
  going against the grain a little bit and not buying in a romantic dynamic. I don't want to feel like
• 30:30
  my whole financial future of freedom relies on a relationship staying together. It's a business
• 30:35
  decision and I want to approach it in that way. Yeah. Have we got any other news? I just want
• 30:41
  you to say with the interest rates drop in New Zealand. If you are in New Zealand, I already
• 30:45
  contacted my bank in being like, hey, I want the lower interest rate please. So if you're on a fixed
• 30:52
  rate, so you can get fixed or floating mortgages. So floating means you'll automatically get this
• 30:56
  rate because when the rate changes, you just get this. You can't follow in the market. Yeah, we're
• 30:59
  investing there. If you follow the market, it does. Yeah. And so if interest rates are going up,
• 31:04
  you'd also get that, you just automatically go on to the new higher rate. Whereas fixed, it's like
• 31:10
  fixed for six months, five months, five years, whatever. So if you're coming up to the end of your fixed
• 31:16
  rate term, then this is a really good chance to talk to your bank and be like, hey,
• 31:20
  I want a lower rate please. Is there anything else that you'd like to report?
• 31:24
  Many news that on your perusing across all the different websites, articles, etc.
• 31:29
  you found something you want to share. Well, when we do talk a lot about climate change and how
• 31:33
  it impacts certain companies and the stock market and the Trump coming in and like all of that,
• 31:37
  I have this feeling like you're about to like, that this is directly aimed at me. Well,
• 31:42
  I haven't actually put this correlation together, but there's also been a huge increase in
• 31:48
  coffee prices. And yes, it's outrageous. I think I figured out it's been 140 pounds last month.
• 31:55
  Yeah. And you're actually 300 New Zealand dollars on a coffee. Yeah.
• 32:00
  Disgusting. You can buy a really good espresso for that. Yeah, I know.
• 32:05
  Well, that's why I'm switching to Marcha, which is more expensive. Is it?
• 32:09
  Why are you more expensive? How much? I used to have paid two pounds 60 for my coffee. My love
• 32:14
  like, this is like four pounds. You know, coffee prices have reached their highest
• 32:20
  levels since 907 and it's all due to climate change. What? The coffee means that they're
• 32:26
  eradicate, are we? Yeah, which is grown in Brazil, has been impacted by climate change. The
• 32:36
  price of the beans has got more and more expensive, which means that gas is gone. It's gone up
• 32:41
  like 26% for something. So that just flows through to higher coffee prices for all of us. So if
• 32:47
  you're like, climate change is not real or I'm an naysayer or it doesn't affect me.
• 32:52
  Firstly, Naysayer, how old are you? Naysayer five. When would you ever in a conversation go?
• 32:58
  I mean, if you're a naysayer, well like a non-believer. So yeah, okay. Naysayer was the person.
• 33:06
  I am an old person now. I don't even think more of Buffett would say naysayer and he's nearly
• 33:13
  90. But anyway, the point is, it's not just inflation that's increasing your coffee prices. It's
• 33:20
  actually the fact that the coffee crops or like the coffee beans, it's like much harder for them to grow
• 33:26
  at a nation. Like if you think you have like a really normal consistency in a growing coffee beans
• 33:31
  and now you've got tornadoes, you've got flies, you've got all this, all the opposite,
• 33:37
  you know, you've got really extreme wildfires, decimated crops, supplies getting less,
• 33:43
  but demand still the same, then that just means higher prices. So do you think they're investing in
• 33:50
  like organic farming or like thinking about what's happening to the way that we farm?
• 33:57
  And like how we're relying on natural resources for things like food. I wonder if there's
• 34:02
  like an alternative, because if the temperature keeps rising like it is and we keep having
• 34:09
  you know global warming as getting worse, there will be alternatives. We will just have to figure it
• 34:14
  out. Yeah, I wonder what those are. Yeah, and it's like investing in companies that are doing good
• 34:20
  for the planet, not ones that are harming the planet. So you're channeling your money and your
• 34:27
  capital into companies, so you're supporting those companies that are having a positive effect
• 34:32
  on the planet. I was wondering, like organic will probably still be impact. I mean it's probably not
• 34:40
  organic, but maybe there's some amazing companies that are growing all the visuals and a completely
• 34:44
  different environment. Yeah, you know, just I'm thinking kind of bigger than that. There might
• 34:50
  even be a time that I need to use the soil, so exactly what? Yeah. Oh god, okay, can we finish
• 34:56
  on a high? Is there any positive news? I thought I'm a really good joke in the weekend. Oh my god,
• 35:00
  tell me what it is. Did you make this up? No. Okay, thank god. It's a Christmas joke. It's great,
• 35:07
  it's Christmas time. Oh, I love this. Yeah, it's a great way to end the podcast.
• 35:15
  What does Santa say at the end of his yoga class?
• 35:20
  No, no, no, no. Namelessly.
• 35:25
  And on that people, we all end my cards. Thank you so much for listening to The Curve Weekly.
• 35:30
  Make sure you hit the subscribe button to stay up to date with all the many Bizzards stock market
• 35:33
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• 35:39
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• 35:43
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• 35:45
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• 35:48
  And we hope you have a good week and see you next Monday.
• 35:51
  Bye. Bye.
• 35:53
  That's great.
• 35:54
  Yeah.
• 35:54
  See you next Tuesday.
• 35:55
  Well.
• 35:58
  See you next Tuesday.
• 35:59
  I mean, Monday.
• 36:00
  No, actually though, new episodes out every Tuesday.
• 36:03
  Okay.
• 36:06
  Okay, quickly, the curve was created to empower and educate you about investing,
• 36:10
  but we are not financial advisors.
• 36:12
  Our platform exists for educational purposes only,
• 36:15
  and it doesn't provide personalized investing advice for your individual needs,
• 36:18
  and should not be relied upon to make an investment or financial decision.
• 36:22
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• 36:26
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• 36:29
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• 36:30
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• 36:32
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• 36:33
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