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Aardvark Daily

New Zealand's longest-running online daily news and commentary publication, now in its 25th year. The opinion pieces presented here are not purported to be fact but reasonable effort is made to ensure accuracy.

Content copyright © 1995 - 2019 to Bruce Simpson (aka Aardvark), the logo was kindly created for Aardvark Daily by the folks at aardvark.co.uk



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The coming year of uncertainty

23 December 2021

On the eve of Christmas Eve we might contemplate exactly what the year ahead holds for us.

I'll make a few predictions and probably get them as wrong as ever.

Covid 19 is enjoying its "last gasps" as a pandemic and will be brushed into the background, along with our usual seasonal influenza maladies. Maybe we'll get an annual vax shot, maybe not.

Omicron increasingly appears to be the immunizing variant of Covid that I suggested it might be back in November -- although the media is still full of stories that fly in the face of the evidence and suggest otherwise.

As is the case with all life however, we will either adapt or die. Now there's a cheery Christmas thought!

So what else lies ahead for 2022?

With any luck our chip shortage will ease, at least a little.

Right now, the lack of semiconductor devices is hurting many industries, its effects being felt far beyond just computers and hi-tech gadgetry.

Having said that, the effects of the silicon drought could have been much worse if we weren't going in and out of lockdown around the world and if we weren't in the process of transitioning from ICE powered vehicles to EVs.

Speaking of which... I expect to see significant growth in the uptake of EVs in 2022. As I've stated in the past, the transition to EVs is probably going to happen a lot faster than most people predicted (shame on you South Waikato District Council for letting yet another opportunity slip through your fingers when spending $4m to redevelop Tokoroa's SH1 frontage).

I'm not sure what's going to happen with crypto-currency but I'm nowhere near as bullish as most. Yes, if you had collected BTC when it was barely worth enough to buy a pizza then you'd be astonishingly wealthy right now -- but then again, there were a lot of paper millionaires around just before the dotcom crash of 2000 right? Suffice to say that I won't be investing any of my coin in crypto next year.

I doubt that the current shortage (and correspondingly high prices) of GPUs will ease much. Most silicon fabrication plants will be busy catching up with more mundane devices and 5-8nm capabilities are still very limited in capacity. Plus, of course, the demand from crypto-miners remains very strong for as long as crypto itself remains viable.

Some of my riskier predictions for 2022 include:

  • No commercially viable fusion generators
  • No commercially viable flying cars
  • No commercially viable drone deliveries

Okay, so not much chance of being wrong about those three!

One thing that does worry me is the continued upward trend in house/land prices, something that may or may not change in 2022.

The sad reality is that unless we are able to tame the beast that is property prices, we'll have another year where our limited and essential capital gets sucked away into non-productive assets such as houses. The only winners in a speculative housing market are the banks -- as witnessed by their ongoing record profits.

There's a lot more money to be made on a $1m mortgage than on a $500K one.

Unlike manufacturing (particularly for export), money "invested" in property does not increase the wealth of the nation as a whole. It doesn't create jobs and it doesn't make anyone (except the investor) better off.

I dare say some of those enjoying the benefits of the huge capital gains associated with property investment are unaware of where their gains are coming from. The reality is that every time a residential dwelling sees its price go up by 20 percent or more in a year, that money is coming out of the pockets of future generations. In effect, those making the gains are effectively creating a debt that is handed on to their children and their children's children in the form of ridiculously inflated prices.

If only that money had been put into funding enterprises that created jobs and really did increase the wealth of everyone by way of growing our export receipts.

So, for 2022 I predict that there will (yet again) be no real wage growth. In fact, it's sad to say but I suspect that Kiwis will fall even further down the ladder as the buying power of what little they do earn is further eroded by growing levels of inflation.

Still, it's not all gloom and doom. The sun will still shine (from time to time), we will still enjoy the splendour that is New Zealand and despite the best efforts of those who profit from creating race-based division within society, most of us will still be one big family of Kiwis.

That's my view of 2022... now share YOURS in the forums.

And, of course, enjoy your time in the sun with friends and family over the break. Remember that (as I have discovered and now embrace) the secret to enjoying life is to live each day as if it was your last.

I'll see you all in the New Year!

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