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Speaker 1: Continuing this week's economic theme of dark economic times. GDP

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Speaker 1: numbers are out later this morning. Not expected to be good.

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Speaker 1: All of our banks are expecting are economy contracted in

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Speaker 1: Q three by about point three down to point four,

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Speaker 1: which is er point three to point four percent, which

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Speaker 1: would put the country back into a recession for the

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Speaker 1: I don't know third time. I'm not sure. Mary Joe

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Speaker 1: Vagara is Vigarda is the KII Bank senior economist and

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Speaker 1: joins you, Now, how are Mary.

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Speaker 2: Joe Modernna, how are you?

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Speaker 1: I'm good? What do you reckon? Is it going to be?

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Speaker 1: Is it going to be another recession?

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Speaker 2: That is what we're We're picking a return to a

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Speaker 2: technical recession. So that would be a point three percent

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Speaker 2: contraction over the September quarter that follows another contraction over journey.

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Speaker 1: You know, yesterday when we had all this dismal news

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Speaker 1: out of Hayefu, there were two types of people that

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Speaker 1: we talked to. One are going, yeah, well, times are tough,

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Speaker 1: but there are green sprouts in the economy. You know,

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Speaker 1: they had some optimism and there is others that went, well,

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Speaker 1: we'll be paying for this by our children and our

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Speaker 1: children's children and their children's children and we're down the

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Speaker 1: good good Where do you stand?

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Speaker 2: I think for the economy, next year should be a

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Speaker 2: better year. So we're a bit more optimistic. But you know,

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Speaker 2: you say it's optimus bracket, it's just realistic. We've been

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Speaker 2: in a recession for the last two years, especially on

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Speaker 2: a per capita basis. But where there's a bank now

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Speaker 2: cutting interest rates, that should you know, start to see

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Speaker 2: growth return in the second half of next year in

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Speaker 2: terms of the you know, fisc outlook at words to

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Speaker 2: perirade it. And that's just following the pattern of what

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Speaker 2: we've seen in the last few years.

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Speaker 1: What about international pressures, because the fairs are picking to

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Speaker 1: they're going to be cutting the rates. It sounds like

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Speaker 1: as well, could that help us?

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Speaker 2: Yeah, when the global economy improves, we do too. We're

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Speaker 2: a small locan economy, so we're heavily reliant on what

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Speaker 2: happens overseas. So when that starts to pick up, which

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Speaker 2: we do expect next year, that's another reason why we

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Speaker 2: expect cloth in New Zealand to pick up as well.

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Speaker 2: Obviously it helps our exporters in that regards.

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Speaker 1: What about the issue of productivity, I mean, while we

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Speaker 1: all blame the government for where we are at. Private

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Speaker 1: debt far exceeds in public and government debt. And we are,

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Speaker 1: of course the business community, and it's up to us

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Speaker 1: to actually get our productivity up. How can we do this?

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Speaker 1: How can we help?

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Speaker 2: Oh, it's definitely just an infrastructure story. We've just under

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Speaker 2: arrested an infrastructure for I don't even know how long,

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Speaker 2: and that has been you know, harboring our productivity. We

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Speaker 2: really need to lift that. It's part of the reason

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Speaker 2: why we've had recession so tough. Yes, we've imployed a

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Speaker 2: lot of people, but our layer productivity is very poor.

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Speaker 2: That's part of the reason why we've had such a

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Speaker 2: volatile a few years.

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Speaker 1: And is government the cutting of government spending Is that

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Speaker 1: a silver bullet or do we need much more, much

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Speaker 1: more weapons in our arsenal?

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Speaker 2: Yeah? I think government spending it needs to be directed

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Speaker 2: into that productivity space, into that infrastructure, you know, building

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Speaker 2: new roads, building hospitals and schools and all of that.

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Speaker 2: That'll I think in a time of recession you need

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Speaker 2: the government to kind of come in and boost boost

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Speaker 2: the economy. And cutting and cutting spending it kind of

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Speaker 2: just makes the situation bit worse.

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Speaker 1: Yeah, thank you so much, Marry Joe Vagada. And that's

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Speaker 1: pretty similar to what Cameron Vagri said at the beginning

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Speaker 1: of the week and said, yes, we do have to

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Speaker 1: cut government spending, but at the same time we also

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Speaker 1: have to invest. The government has to invest. It's a

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Speaker 1: big player. Look at the construction industry. You know, they

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Speaker 1: invest in school buildings and hospitals, et cetera, and then

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Speaker 1: that money ends out in the hands of the construction industry.

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Speaker 1: Look what's happened to the construction industry as we've cut

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Speaker 1: down on that construction from the government money. So everything

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Speaker 1: is into LinkedIn, everything is intertied. For more from Early

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