Christmas cards, capital for Kiwibank and family silver.

December 26th, 2011

This year I got many more business Christmas cards by email than by post.. I assume that's general, and they've become mainstream. No doubt NZ Post can tell how much the normal Christmas card mailings dropped.

It is fashionable to decry the email Christmas cards. I liked most of them this year. Tasteful photographs seem to have replaced the moving bling-enhanced mini-posters of earlier years.

What a pity for NZ that NZ Post was not privatized years ago when its first transforming CEO Harvey Parker (and the Board) were warning the Government to take the gains of the huge increase in productivity before the rest of the world woke up to the difficult future for steam post. NZ Post was a world leader in post reform. When the government would not take the logical next step, Harvey Parker's team dissolved, though many had fun around the world advising other countries on how to stop losing money on dinosaur post.

If NZ Post's sunset businesses had been sold, even 10 years ago, the sale could have provided the capital needed by Kiwibank several times over.

There will always be fools around who'll pay on historical expectations for a horse based empire just as petroleum engines take over. Often they are politicians, driven by romantic attachment to sunset industries (or dependence on the funds and votes from their unions) like Dr Cullen and the repurchase of NZ Rail. But Telecom's inspired sale of Yellow Pages was a reminder that we can rely on compulsory superannuation scheme managers, and investment bankers who advise them, to squander their contributors' weekly mites. In March 2007, Telecom sold its Yellow Pages business for $2.24bn to the Ontario Teachers' Pension Plan and Unitas Capital of Hong Kong. They and their bankers have lost most of their money.

I'm surprised that during the recent ill-informed debate on mixed ownership no one raised Bill Birch's inspired sale of the major forests, and some other dumpings of "family silver" onto overseas investors. The forest buyers lost well over 2/3rds of their investment. There are always investors around to gamble on the future looking like the past.

Filed under Commercial, Economy

Comments

So many people when trying to predict the future,simply project the present and can't understand why they are invariably wrong. I see that the Labour Party in the last election had a 30 year plan-if you think back to 1981 its not hard to see why the idea is incredibly stupid. Post Offices are such hugely inefficent places and for some reason they think that they can also runa bank!

The list of missed opportunities doesn't end with NZ post and the central government . Tvnz was the most obvious sale as shown by what private equity paid for tv 3 etc. But what about the democratic republic of Christchurch ? What value the grandiose airport now? What about Orion? Land bought off Henderson? Etc

I still think that there is an elite position for hand delivered mail.
I received and invitation to my neice's wedding by post, and it was and engraved work on white cardboard. Its the cost I suppose, but if the local garbage collector can pick up my junk from the street side, maybe he can deliver high quality mail at the same time

yes fools hang on not least those fools who think that public ownership is good – the greens, the left of labour and the ignorant (actually they're all the same come to think of it). my wife says that people like to travel on Air NZ because the country owns it!! She seems not to be aware of JetStar, Emirates, Quantas etc nor that, as dear Roger Kerr told us, Air NZ hasn't made its cost of capital for years. Just like the PO what a great investment for public ownership. As with Ports of Auckland. How many of the ignorant majority realise the loss of value from the happenings there in the last few weeks. Great public asset, yes? Govts are about law, justice and some safety net. That's about 15% of GDP. Locals are about rubbish, dog licensing and reticulating sewage. Not much else. The Clarke amendment to allow locals to do anything they want to do was a horrendous mistake but few seem to rile against it. Notwithstanding my despair at NZ's direction have a great new year.