Summer sunshine and market overheating

I’VE SPENT the past couple of weeks asking people to provide their prognostications on 2013, so it would seem a bit rude not to at least try to go through the same exercise myself.

I’m picking a big year for the NZX. Already last week we’ve seen another well-known brand, in the form of the Mad Butcher, bought and being prepared for a backdoor listing. While that particular path to the exchange is a bit, well, whiffy and historically fraught with investor danger, on the positive side you can say the Mad Butcher is a real company with real revenues.

My guess is the margins are fairly small, but it is not subject to the kind of disruption other retailers face from online sales. Apart from that we’ll have to wait for a prospectus.

The rumours persist that there are others waiting in the wings to list in a more direct kind of way.

That danger is there is a lot of money looking for a home and we must all remember what happens when that occurs – overheating and bubbles.

There is a fair bit of heat in the market right now and I predict we will all do what we have done so often in the past and ignore the warning signs and try to climb on board. The feeling of missing out on something good is too strong to prevail over common sense and sober analysis.

I predict little or nothing will come of oil and gas exploration off our southern shores unless we, the taxpayers, assume all or most of the risk and costs if something goes wrong. That will all be buried in the detail of the contracts, of course.

I expect negotiations over the Trans-Pacific Partnership trade deal will continue, and continue, and continue in utmost secrecy with occasional juicy leaks. When the heat goes on they will either collapse in a heap or our leaders will try to pretend they have achieved a ‘‘high quality’’ agreement.

To my mind, the test of a highquality free-trade deal is very simple – it can be written in one page. If the final TPP comes out at any more than one page you can be assured we are being screwed.

Christchurch will rebound strongly this year and will take the rest of us with it. Auckland will hammer along nicely too. Unfortunately, our coming boom will be much like the last ones – based on property dealing, development and speculation.

Meanwhile, innovative companies and start-ups will thrive. Some will list and some will be sold overseas. As long as we keep producing them, that isn’t the end of the world.

I predict an absolutely brilliant summer, despite Niwa cursing it by saying the same.

It will be a long, hot summer. I predict happy times with friends, family and loved ones.