house price vs. wage issue

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MikeB4

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#1955601 12-Feb-2018 11:04

Geektastic:

I see Fletchers are treading in the brown stuff a bit financially judging from this morning's news.

I wonder how the "lets build heaps of affordable homes" plan will do if Fletchers sinks...

Fletchers will not sink, if it came close to that there would be a rescue package and rightly so.

Geektastic

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#1955644 12-Feb-2018 12:03

MikeB4:

Geektastic:

I see Fletchers are treading in the brown stuff a bit financially judging from this morning's news.

I wonder how the "lets build heaps of affordable homes" plan will do if Fletchers sinks...

Fletchers will not sink, if it came close to that there would be a rescue package and rightly so.

Why rightly so? They are a private business, not a quango. If they fail, it's because they were inept so I can't really see why taxpayers should be footing that bill. To be honest, it would probably do some good, since Fletchers appear to control the price and supply of quite a lot of popular building products in NZ. Might be an opportunity for some disruption rather than BAU.

Aredwood

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#1955777 12-Feb-2018 14:52

MikeB4:
Geektastic:

I see Fletchers are treading in the brown stuff a bit financially judging from this morning's news.

I wonder how the "lets build heaps of affordable homes" plan will do if Fletchers sinks...

Fletchers will not sink, if it came close to that there would be a rescue package and rightly so.

They definitely should not be given any kind of bailout if they go under. There are plenty of large overseas construction companies that could buyout the assets, re employ the workers, and keep things going. There is already way too much corporate welfare in NZ as it is.

It is entirely Fletchers fault that they are in the situation that they are in. Since they control the whole supply chain, they shouldn't have any problems making a profit.

dejadeadnz

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#1956035 12-Feb-2018 21:42

MikeB4:

Fletchers will not sink, if it came close to that there would be a rescue package and rightly so.

You have a tendency to assert incredibly controversial positions with nothing more than a one-liner and not a smidgeon of evidence. What's so right about this?

MikeB4

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#1956050 12-Feb-2018 22:27

Geektastic:
MikeB4:

Geektastic:

I see Fletchers are treading in the brown stuff a bit financially judging from this morning's news.

I wonder how the "lets build heaps of affordable homes" plan will do if Fletchers sinks...

Fletchers will not sink, if it came close to that there would be a rescue package and rightly so.

Why rightly so? They are a private business, not a quango. If they fail, it's because they were inept so I can't really see why taxpayers should be footing that bill. To be honest, it would probably do some good, since Fletchers appear to control the price and supply of quite a lot of popular building products in NZ. Might be an opportunity for some disruption rather than BAU.

They are a very large employer directly and larger indirectly. There are considerable government and private contracts with Fletchers. If they were to collapse the flow on into the economy would be significant. There would be considerable risk of other company collapses as a result that can cause a domino affect.The risk to the NZ economy would be too great for the Government to ignore and a bail out would be logical.
A goal of bail could be to stabilize the company until a recovery can take place or a buyout negotiated.

GV27

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#1956100 13-Feb-2018 06:48

MikeB4: They are a very large employer directly and larger indirectly. There are considerable government and private contracts with Fletchers. If they were to collapse the flow on into the economy would be significant. There would be considerable risk of other company collapses as a result that can cause a domino affect.The risk to the NZ economy would be too great for the Government to ignore and a bail out would be logical.
A goal of bail could be to stabilize the company until a recovery can take place or a buyout negotiated.

They are also one of few organisations that have expertise at building large-scale projects, which is the approach we need to deliver massive amounts of apartments and residential blocks at once. I'd imagine there would be plenty of work for them in the event they were pseudo-nationalised as part of a bailout. Perhaps it's something the Superfund could look into, although it would need to perform.

Aredwood

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#1956698 14-Feb-2018 01:56

Actually, because Fletchers are vertically integrated. Any domino effect would be mostly limited to other Fletchers companies.

Also how big dies a construction company need to be to attain the magical "too big to fail" status? Should the government have bailed out Mainzeal construction when it collapsed? What about the numerous small construction companies that mostly just build a few homes here and there.

What about other companies that are also related to construction? Such as Lyon Electrical? Should they have gotten a bailout?

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MikeB4

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#1956765 14-Feb-2018 09:22

Aredwood: Actually, because Fletchers are vertically integrated. Any domino effect would be mostly limited to other Fletchers companies.

Also how big dies a construction company need to be to attain the magical "too big to fail" status? Should the government have bailed out Mainzeal construction when it collapsed? What about the numerous small construction companies that mostly just build a few homes here and there.

What about other companies that are also related to construction? Such as Lyon Electrical? Should they have gotten a bailout?

Fletchers employ tens of thousands directly. A collapse will impact NZs economy and possibly plunge the economyinto recession. Unemployment would jump considerably.

Geektastic

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#1956775 14-Feb-2018 09:36

GV27:
MikeB4: They are a very large employer directly and larger indirectly. There are considerable government and private contracts with Fletchers. If they were to collapse the flow on into the economy would be significant. There would be considerable risk of other company collapses as a result that can cause a domino affect.The risk to the NZ economy would be too great for the Government to ignore and a bail out would be logical.
A goal of bail could be to stabilize the company until a recovery can take place or a buyout negotiated.

They are also one of few organisations that have expertise at building large-scale projects, which is the approach we need to deliver massive amounts of apartments and residential blocks at once. I'd imagine there would be plenty of work for them in the event they were pseudo-nationalised as part of a bailout. Perhaps it's something the Superfund could look into, although it would need to perform.

The idea of even semi-nationalising them would be a recipe for even less vfm for the customer.

Look at Air NZ. Amongst the priciest international flights. However since the government own about half, they have little incentive to risk what amounts to a stealth tax by taking any action to encourage more competitive prices.

bmt

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#1958334 14-Feb-2018 21:24

Have you guys even properly read what's happening with Fletcher Building? They aren't going to fail or collapse - only one section of the company is losing money (Business and Interiors), the others are profitable and the company as a whole is still profitable.

Please explain why or how they would collapse / require a government bailout.

Geektastic

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#1958340 14-Feb-2018 21:45

bmt:
Have you guys even properly read what's happening with Fletcher Building? They aren't going to fail or collapse - only one section of the company is losing money (Business and Interiors), the others are profitable and the company as a whole is still profitable.

Please explain why or how they would collapse / require a government bailout.

You'll have observed that the discussion began before that level of detail was made public.....

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