NZ Everyday Investor

Jeremy Couchman: Venezuelan Crisis - Contagion or Canary in a Coal Mine?

Episode Summary

Jeremy Couchman // Venezuelan Crisis – a contagion, or canary in a coalmine? QE withdrawals and unintended consequences // Darcy Ungaro chats with Kiwibank Senior Economist.

Episode Notes

Jeremy Couchman // Venezuelan Crisis – a contagion, or canary in a coalmine? QE withdrawals and unintended consequences. Darcy Ungaro interviews Kiwibank Senior Economist.

Now if I can only raise billions in foreign capital by launching my own crypto-currency - sounds like a good idea! 'Yeah, let's do that!' said Nicolás Maduro, and just like that, 'The Petro' was born. As of August 2018 however it does not appear to be holding out that well - can't blame the guy for trying new things but really, I think the issues run a little deeper.

In this episode Jeremy Couchman, a senior economist at Kiwibank joins us to discuss the Venezuelan Crisis - how does this happen? And could it ever happen here?

You allow any leader to operate in the extremes of their personality, and you're going to have disastrous consequences, in this case mass migration and hyperinflation. That's not the the whole story though - one has to consider the worldwide macro-economic environment also. Almost a decade of quantitative easing has given a short term fix to many developing countries and now that the dealer's gone quiet, and the price has increased, withdrawal effects are well and truly setting in.

Fortunately NZ has no parallels, and highlights many things that we take for granted, stable government, smooth transition of power, independent and respected institutions such as judiciary and central bank. NZ is well and truly a 'safe haven' in light of a worldwide economy that, let's just say, has some 'issues'!

There's some meat and potatoes in part one of this interview - we hope you enjoy!

“Jeremy joined Kiwibank in 2015 following four years living in London where he was involved in econometric analysis and forecasting for a national news publisher. Prior to London, Jeremy worked for various NZ government departments including The NZ Treasury, the Ministry of Social Development and Statistics NZ. At Kiwibank, Jeremy is responsible for producing economic forecasts and regular commentary on economic matters. Jeremy holds a master’s degree in Applied Economics from Massey University.”

Anyone can take a look at the work Kiwi Economics is doing via Twitter: @kiwieconomics

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