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The Mike Hosking Breakfast

Full Show Podcast: 14 May 2026

13 May 2026

Transcription

Chapter 1: What is the main topic discussed in this episode?

0.301 - 19.816 Mike Hosking

Tough on power, sharp on insight. The Mike Hosking Breakfast with Aveda Retirement Communities. Life your way. News Talks at B. Welcome today, tough in China, we get you to Beijing. New fines for supermarkets that make the pricing dodgy. Nicola Willis and her ever-shrinking operating allowance. The head of Jetstar on fuel bills and flight cutbacks, Joe McKenna in Rome.

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20.237 - 31.347 Mike Hosking

Rod Little on the Star Madrama. Welcome to the day, seven past six. I've learned a lot about kids in university. Having had two attend and graduate, one still immersed in the experience as we speak, the takeouts are as follows.

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Chapter 2: What insights are shared about the current state of supermarkets?

31.447 - 49.596 Mike Hosking

Generally, you go for a reason. You've got an idea of what you want to achieve. Those who don't flounder quickly. I've got many examples over the years of kids who enrolled because that's what you do. Schools too often give university as a default. It's got a snobbery about it because successful people go on to tertiary learning.

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49.576 - 61.188 Mike Hosking

Seems the wider lesson we've all learned, as Jacinda Ardern's next year's on me, was fatally flawed, one, because funding the first year was literally a waste of money, and two, even when it got put to the back end of study, it would seem the world hasn't changed either, and so they're scrapping it.

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61.529 - 78.587 Mike Hosking

The reality is people on a path will incur debt in the belief that whatever it is they're studying will serve them well, provide challenge and enjoyment, and hopefully pay a wage that allows them to pay back the loan and get on with their lives. Uni's always been heavily subsidised anyway, of course, on the idea that we all benefit.

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78.567 - 95.283 Mike Hosking

But I've always thought to suggest you study for anyone other than your own personal satisfaction and enhancement is farcical. So no more first-year, last-year artificiality. The money, apparently, will be put elsewhere, or at least some of it, perhaps, into the more practical side of the workforce. Personally, I wouldn't mind if the whole lot was saved.

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95.303 - 97.685 Mike Hosking

It's not like we actually have the money in the first place anyway.

Chapter 3: How do university experiences shape students' futures?

98.105 - 115.561 Mike Hosking

But the Peters argument appears to be the trades, which makes it yet another of those debates that's constantly tinkered with and never really resolved. I mean, is paying an employer to train a person... any more or less wasteful or artificial than paying a university to train a doctor. I mean, we need doctors as much, if not more, than we need plumbers or engineers. Both are valuable.

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115.601 - 130.854 Mike Hosking

Both are in short supply. The Peters argument will, of course, be driven by the immigration part of all of this. If we don't train who we need, we need to bring them in. And before you know it, you've got a butter chicken tsunami. It is, of course, a government, again, picking winners. And I would have thought we've already learned that lesson.

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131.195 - 147.907 Mike Hosking

Peter's other idea, if you remember, was bonding students to regions or indeed immigrants to regions. That didn't work either. The trick here is not to repeat the past mistakes, and yet it would appear the budget is destined to include at least one. News of the world in 90 seconds.

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Chapter 4: What is the impact of rising interest rates on borrowers?

147.927 - 153.475 Mike Hosking

Well, looks like the spiller's on, Starmer V Street, and buckle up. Before all of that, though, the King had to actually open the place.

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153.935 - 169.037 Unknown

An increasingly dangerous and volatile world threatens the United Kingdom. Every element of the nation's energy, defence and economic security will be tested. My government will respond to this world with strength and...

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169.017 - 175.165 Mike Hosking

and aim to create a country that is fair for all. After that, Kemi was ready with some observations.

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175.486 - 194.29 Unknown

The Prime Minister is in office but not in power. Nearly 100 Labour MPs have called for the Prime Minister to resign. Four ministers have quit. It is clear his authority has gone and that he will not be able to deliver what little there is in this King's speech.

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195.352 - 197.775 Mike Hosking

Keir tried his best to pretend nothing was happening.

197.806 - 201.87 Unknown

In difficult days, her input is always a ray of sunshine.

205.534 - 223.172 Mike Hosking

I particularly getting tips from her on how to win friends. This is for the party, Mr Speaker, who previously called us orcs and goons. Wasn't bad. Trump, meantime, probably asleep in Beijing as we speak, or at least on Truth Social, one or the other. But before he left, he had some advice for Starmer.

223.152 - 254.76 Mike Hosking

Also, these comments before he left have not played particularly well for Americans who, I don't know, fill their cars and buy food. The only thing that matters when I'm talking about Iran, they can't have a nuclear weapon.

Chapter 5: What trends are emerging in the travel industry post-COVID?

254.78 - 272.924 Mike Hosking

I don't think about American financial situation. I don't think about anybody. I think about one thing. We cannot let Iran have a nuclear weapon. That's all. Every American understands. I'm not sure they do. Rat Cruise update for you now. Jake, he was on board. He's back in ISO in Nebraska. So how's he doing?

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273.325 - 286.026 Jake

It is my second day here at the National Quarantine Unit in Omaha, Nebraska. I'm feeling well. I'm in relatively good spirits. And I hope to be able to keep you all a little more updated throughout this process.

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286.386 - 294.772 Mike Hosking

Good. That's news of the world in 90. 17 minutes. Starmer and Streeting met today, 17 minutes. That gives you a clue.

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Chapter 6: How is the government addressing consumer protection in pricing?

295.433 - 306.192 Mike Hosking

He's, they say, set to quit tomorrow. He's got the 81 to trigger the vote. The big question next, though, and we'll talk to Rod about this later, is having triggered the vote, does he actually win? And if he doesn't, what happens then?

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306.212 - 315.208 Unknown

12 past six.

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317.332 - 336.418 Mike Hosking

Starmer's got the business community worried as well. The bond market is quote-unquote on edge. J.P. Morgan Chase, who's Jamie Dimon, he seems to comment on everything. Anyway, he said he's reconsidering their multi-billion dollar office tower in Canary Wharf if Starmer's out. So that would house 12,000 people. It'd be the UK headquarters.

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336.438 - 340.183 Mike Hosking

He's suggesting that if Starmer goes, that building's not going to happen. 15 past.

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341.204 - 342.546 Unknown

Brown! Brown!

342.526 - 347.929 Mike Hosking

Shore and partners, Andrew Keller. Good morning. Morning, Mike. Talk to me about the swap rates and how worried I should be.

Chapter 7: What are the implications of immigration policies on the job market?

348.787 - 357.815 Mike Hosking

Yeah, I want to talk about interest rates this morning because we've spent the whole week talking about inflation, and inflation can obviously have a direct influence on what happens with interest rates.

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357.835 - 383.883 Mike Hosking

So yesterday, Mike, the local two-year swap rate, the benchmark interest rate that's used, I suppose, as a base rate for where banks set their two-year fixed mortgage rate, yesterday that rate hit the highest level it's been at since December or November, December 2024. So the current level is 3.66%. Now, last October, when we weren't worried about inflation at all, that rate was at 2.44%.

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384.043 - 409.182 Mike Hosking

So it was almost 1.25% lower. And by the start of the Middle East conflict, that rate was just under 3%, 2.94%. So we'd started to get a little bit concerned about inflation before the conflict began. But the key issue that I want to stress here, Mike, is that The official cash rate, that was reduced over 2024 and 2025 to the current level of 2.25%. The OCR has not moved.

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409.823 - 430.217 Mike Hosking

But since the OCR got to 2.25%, the two-year swap rate has gone up by one and a quarter percent. So what this means, and it's pretty significant, is that financial markets have effectively tightened monetary policy already. So we're all staring at the Reserve Bank, we're all asking the question, oh, when are they going to move the official cash rate?

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430.638 - 447.845 Mike Hosking

But the actual impact of that has already happened. Mortgage rates have already moved up. And at the moment, that direction of travel is probably likely to continue. So the bank hasn't had to move the official cash rate at all. Similar situation with one-year rates as well. Now, floating rates haven't really moved.

Chapter 8: How does the current political climate affect leadership challenges?

447.905 - 471.201 Mike Hosking

That's sort of relevant for business loans and business lending. But the key issue here, Mike, is that the market has done the heavy lifting for the RBNZ already. And so this lift in wholesale rates means that borrowers, if you were a borrower out there right now and you're rolling off a one-year fixed mortgage rate, you're going to be refixing that mortgage rate in an environment

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471.181 - 489.235 Mike Hosking

where the effective funding rate through one-year swap is higher than it was when you fixed a year ago. So the average mortgage rate across the country, it's been falling. That's been putting more money into household pockets. That impulse sort of could be troughing. So it's all about inflation. It's pushing interest rates up around the world.

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489.555 - 499.414 Mike Hosking

But the markets have already tightened monetary policy. Good insight. Speaking of inflation, 3.41 one year ahead. I wouldn't have thought that's the end of the world. No, not at all.

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499.454 - 518.107 Mike Hosking

So the RBNZ, and here's the thing, so the RBNZ have sort of guided us to sort of three indicators that they're looking at to decide whether or not they need to start hiking the OCR sort of faster than they thought they would. That's headline inflation, wage growth and inflationary expectations. When wage growth came out the other week, it's pretty benign.

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518.568 - 539.353 Mike Hosking

Yesterday, there was a lot of interest in the results of their survey of inflationary expectations, because the danger is that those expectations become what we call unanchored from the current inflation levels, and that can contribute to a wage and price inflation spiral. But the good news, Mike, is that while inflationary expectations are rising, they don't look to me like they're unanchored.

539.653 - 559.96 Mike Hosking

I mean, they've moved higher. That's to be expected. One year ahead, inflation is expected to be 3.41%. Yes, the previous number was 2.59%. It's quite a bit higher. But if I look at the two-year inflationary expectation, so two years ahead, it was at 2.37%. It's now at 2.53%. And actually, there's been a small fall. in longer-term expectations.

560 - 579.537 Mike Hosking

So inflation, while it's currently running at 3%, probably moving to 4% or higher, well, expectations aren't out of whack with that, Mike. They're not unrealistic. So the RBNZ for the moment, I don't think they'll see any red flags there at all. Exactly. Give us a quick word on the CBA. Was that all budget-related yesterday or not? Oh, it was an awful combination of factors.

579.557 - 600.338 Mike Hosking

So CBA, big Aussie bank, owns ASB, huge part of the Australian index. I think it's about 10% of the Australian index. It's massive. Share price got actually hammered, fell 10.4% yesterday, one of its biggest one-day falls on record. What's happened here, Mike, released their quarterly results broadly in line with expectations, but the problem was their capital levels looked a little bit light.

600.378 - 606.184 Mike Hosking

And then you get this whole sort of combination of factors that came along. You sort of have the budget day implications here.

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