Finance Minister Michael Cullen has seen fit to suggest that Kiwis should be throwing their money into abstract share portfolios as well as bricks and mortar. I'll just get the millions I hoard under the mattress in my rented bedsit, drive down in my shitty little Honda import to the stockmarket pimps and buy a few thousand Sky City shares. Cullen's got my vote.
That was laying it on a bit thick, but it's early in the day and I still haven't had my three espresso breakfast yet. You get the point.
It's election year, and every word a politician says is aimed at squeezing another vote into their pocket. Labour's secured the house pimp vote thanks to school zoning. Even Laila Harre must be tempted to tick Labour after the government paid for nurses' historic 14 to 30 percent pay rise. The working and not-working poor aren't rushing off anywhere, regardless of what Matt McCarten thinks (The Rebel Alliance Party anyone?).
Many Kiwis will tune out to Cullen FM's advice. He wasn't speaking to or for anyone I know. More people are likely to follow Tony Soprano's advice: "Buy land, cause God ain't makin' any more of it." Unlike share splits, for instance.
The housing bubble is not going to go away. Even local councils such as Queenstown trying to get a slice of the action. New Zealand is becoming a retirement village to the stars (Cher, Twain, Rhys-Davies, et al), an immigrant destination (like the US and Australia were earlier), and a safe-haven from terrorism. We are the nuclear fallout shelter of the Fourth World War.
As far as long-term investments go, you can't beat land. It will outlast Black Fridays, dotcom implosions, Enron scandals, and Asian Tiger blues. You can improve land yourself, tweak it to improve the value. The most you can do with a share certificate is frame it and stick it on the wall for friends to admire. Let's face it, land is undervalued.
Small to medium private companies still do most of the real work in this country (although franchises are getting a larger market share thanks to scales of regulatory economy). The diversity, entrepreneurialship and innovation that comes from these businesspeople will not be affected one jot by Mums and Dads buying abstract investments. Come to think of it, most times even public companies won't get any more investment out of it. Shares are bought off other shareholders. It's like buying rare Split Enz vinyl on TradeMe to support the Finn Brothers.
Speaking to the Auckland Chamber of Commerce, Cullen's speech was Hannibal noises to the Nat voting bloc; the suits, breadheads and share pimps. "Follow my lead," he could have said, "I've already taken billions from Kiwis with the Cullen Fund and invested heavily in overseas companies."
Cullen voted against the Death with Dignity legislation and it shows. There's no pretty demise for the National Party if its core voters take a liking to the Cullen-lingus.
