By now, nearly three million people should have received their annual KiwiSaver statements. For some, it will be a useful reminder they're gradually building up a nest egg for their retirement. Others will be heeding the advice of various financial commentators that, for the sake of their mental wellbeing, it's best not to look right now.
Major disruptions including the Covid B pandemic and the war in Ukraine are wreaking havoc on international financial markets, where most KiwiSaver funds are invested. In the middle of June, one of the United States' best-known indices, the S&P 500, officially entered bear territory, which means it was down at least 20% from its most recent peak.
The last time we had a lengthy bear market was during the global financial crisis (it lasted 517 days), and before that was the Dotcom crash in the early 2000s (929 days). It's been fewer than 200 days since the S&P 500 last peaked, so it's entirely possible things could get worse before they get better.
Rocketing prices of everything from gas to groceries are complicating the picture. In New Zealand, inflation has hit a painful 6.9%, but in the US it has already hit 8.6%, and in the UK it is predicted to hit 11% by October. The World Bank has even raised the specter of stagflation - a nasty combination of low growth, high prices, and high unemployment. What does that feel like? Just ask anyone over 60.
In the 1970s, petrol prices were kept sky high by Arab oil states, following a series of regional wars. Financial markets were spooked so badly that the Dow-Jones index, adjusted for inflation, remained stagnant for more than a decade. Kiwis who lived through that time remember compulsory carless days, a wage and price freeze, and double-digit mortgage rates as the government desperately tried to stay in control.
Bu hikaye New Zealand Listener dergisinin July 2 - 8, 2022 sayısından alınmıştır.
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Bu hikaye New Zealand Listener dergisinin July 2 - 8, 2022 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Giriş Yap
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