How do we create the ‘2degrees Effect’ for supermarkets, banking and electricity?
More than half of consumer spending is dominated one way or another by a collection of monopolies, duopolies and quadropolies that generate higher prices and profits than would be normal if there was true and tough competition, as a myriad of market studies and inquiries have found for supermarkets, fuel retailing, building materials, electricity, banking, insurance and real estate agencies. Twenty years of finger-wagging and report writing has failed in all of these sectors, except for telecommunications, where an aggressive breakup of a monopoly (Telecom) and regulation of number portability and interchange fees, along with the arrival of third competitor in 2degrees, sparked a flourishing of competition and ever-lower prices for ever-more data. The Reserve Bank called it the “2degrees Effect” in creating deflation for a significant part of the economy.
Bernard Hickey talks to Monopoly Watch spokesman and one of the founders of 2degrees, Tex Edwards, about how to create the “2degrees Effect” for supermarkets, banking and electricity.
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39:04
An AI-powered startup
Bernard Hickey talks to the co-founders of Christchurch-based AI start-up, Contented. Lucy Pink and Hannah Hardy-Jones tell their story from meeting over coffee and jam, to working with US news publishers to turn live-streamed council meetings into news articles.
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33:30
The global aftermath of Trump’s ‘Liberation Day’
Donald Trump’s bigger-and-stupider-than-expected tariffs have upended the global trading system and are threatening to create a new financial crisis. Bernard Hickey talks with Kiwibank chief economist Jarrod Kerr about the latest day “when the facts changed”, and what might happen next.
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37:32
The green shoots and brown roots of our economy
If New Zealand’s economy was a grass paddock, it would be in pretty rough shape. We’re coming out of a pretty bad drought (economic recession) and there’s widespread political disagreement about how to get our worn-out field of brown grass back to the lush green pasture it once was.
Bernard Hickey speaks to Kiwibank economist Sabrina Delgado about what looks promising (green shoots) and what looks worrying (brown roots) in the meadow of our national economy.
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27:25
Planting the trees we’ll never sit under
For 30 years, a little-known number in government circles has quietly stymied investment for future generations. Set by Treasury, the ‘discount rate’ was once set at 10%, and it meant future benefits and costs were heavily devalued, becoming worth almost nothing after six or seven years. In a nutshell, higher discount rates discourage long-term investment and incentivise short-term projects. Treasury has recently reduced the discount rate to 5%, but is that enough?
Bernard Hickey talks with Arthur Grimes, senior fellow at Motu Research and professor at Victoria University, about a big shift to new discount rates that could make big future projects much more viable.
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Hosted by journalist Bernard Hickey, When the Facts Change is your essential weekly guide to the intersection of economics, business and politics in Aotearoa New Zealand. Presented by The Spinoff together with Kiwibank.
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