The Great Forest God, Tane Mahuta, Worst Reserve Bank Governor EVAH
Money printer go brrrrr…….

Awwww…. Last time I’ll be able to use that photo, and while I usually don’t bother with “BREAKING NEWS” – a blog being a place of thoughtful analysis – this is worth reporting. Reserve Bank Governor Adrian Orr resigns:

The Reserve Bank Governor Adrian Orr has resigned after seven years in the job.

In a statement, Finance Minister Nicola Willis said Deputy Governor Christian Hawkesby would be Acting Governor until March 31.

No reason was given for Orr’s decision to leave before his term was up.

Thank fuck for that and good riddance. His number one job was to keep inflation under control, but even as he saw the Labour government pissing money into the wind in 2020-21/22 he kept interest rates low until it was too late – after which he jacked them up faster than at almost any stage in the Bank’s history.

The there’s the $9 billion loss $11 billion current loss on government bonds (Orrsomely Shite – it was $9 billion in 2022), again because he expected inflation to remain low, despite the fiscal blowout.

Let’s hope the next Governor starts re-building the Reserve Bank’s analytical capabilities because Orr gutted the place to enable his strong-man rule. The following from him is just delusional:

In a statement, Orr said the Reserve Bank had built its capability and credibility to face what he called an “increasingly complex and challenging global environment”.

No you didn’t, at least according to Michael Reddell over at his economics blog, Croaking Cassandra where you can read a number of articles about Orr posted over the years, none of which paint a flattering picture either of the Governor or the team he built around him.

His 2022 speech “Why we embraced Te Ao Maori”, analysed here by Reddell, was a classic example, where Orr talked about environmental sustainability, social cohesion, cultural conclusion, “our values” and how a Maori worldview can help deal with all this – and yet almost nothing about the core policies of the bank, monetary policy and inflation. But it was like this right from the start, as pointed in this 2018 post, Orr among the forest gods:

Instead, we’ve heard the Governor on almost everything else.  There was infrastructure, climate change (repeatedly), the failings of capitalism, geopolitics, women in economics, and of course bank “conduct” (playing distraction from his institution’s own failings, by trying to butt into a field for which the Bank has no statutory responsibility). 

I’ve got my own list of articles about the useless prick here.

============================

Some examples from Reddell, starting with this from March 2020 as things began to fall apart globally with lockdowns on global trade and travel. When he writes an article on this resignation and looking back at Orr’s “highlights” I’ll update this post with it:

Almost literally unbelievable (March 2020)

Except that I had to believe it.  The Governor himself was being quoted again in a Stuff article and the video footage of a full interview with his deputy (on the economics and markets side) Christian Hawkesby was on interest.co.nz.

On Tuesday, as I wrote about in my post yesterday, we had the Governor telling us that monetary policy would have no more than a supporting role –  despite being the main cyclical stabilisation tool – that there would be no “knee-jerk reactions”, that we were in “a good space” and  –  perhaps most incredibly of all –  that “confidence and cashflow will win the day”.  Confidence that had tanked, cashflow that was rapidly becoming a problem for many.  It was –  or one really wished it was –  unreal.

Just days later Orr would announce a cut of 50 basis points in the OCR, as he suddenly woke up to what the Chinese Lung Rot Lockdowns globally would likely do to the NZ economy.

Why is such rank dishonesty tolerated? (2025)

“We were one of the first central banks in the world to be tightening; we were one of the first central banks in the world to be easing”

Orr has run the “we were one of the first to tighten” lines repeatedly in the last few years, but I hadn’t heard the (even more preposterous) claim about being one of the first to ease before. In various posts I’ve noted that his claim re tightening is simply false. But that point has often been buried in longer posts. So this post is devoted solely to those two factual claims.

Orr at it again (2025)

An old colleague listened in [to the FEC], and was rather concerned to hear Orr’s deputy chief executive for macroeconomics and monetary (the one with no qualifications or background in either subject) Karen Silk making what appeared to be the claim that the Bank and MPC had got the trends in inflation about right. 

Fiction and spin (2024)

I’m wondering how Martien Lubberink, Roger Partridge, Jenny Ruth or Nicola Willis (in her Opposition days) feel about their experiences of Orr as empathetic communicator? Disdainful bullying is probably a fairer characterisation of his style.
…
Has anyone ever associated Orr and his public communications with the word “humility”? Perhaps we might all take this as less like make-believe if it weren’t so well-documented just how many times Orr has actively misled Parliament’s Finance and Expenditure Committee (charged in part with holding him to account), or if he didn’t send out his chief economist to say “oh no, we didn’t really mean what the numbers say, and anyway it isn’t our fault but that of the tools”. Nothing, you see, is ever the fault of Orr and the MPC…..at least in this fairy tale.

$35m per annum and this is the sort of “engagement” we get?

It has been yet another bad week from the Governor of the Reserve Bank. He was on the defensive about the huge change of policy view between May and July/August, and instead of smiling and ruefully admitting that perhaps the May MPS wasn’t one of their best, we saw repeated episodes of thin-skinned bluster and defensiveness, whether at his press conference, in radio interviews (eg with Hosking) and – perhaps most egregiously since public officials are answerable to Parliament – his reactions to questions from the chair of FEC on Thursday morning. People who refuse to ever acknowledge a mistake are very dangerous, including because it tends to go with a very real unwillingness to learn (including from mistakes).

What did the RB have to deal with? (2023)

If forced to confront these arguments the Governor would no doubt burble on about “least regrets”. But the least regrets rhetoric a couple of years ago was really about – and they know this – the risk that inflation might, if things went a bit haywire, end up at 2.5 per cent or so for a year or two, rather than settling immediately around the target midpoint of 2 per cent. It wasn’t – was never even suggested as being – about the risk of two or three years of 6 per cent core inflation, and a wrenching adjustment to get it back under control.

They may still claim to have no regrets. They should have many. We certainly should. They took the job, did it poorly, and now won’t even openly accept (what they know internally) that it wasn’t the evil Russian or a cyclone or….or….or…it was them, Orr and the MPC. They made mistakes (they happen in life), with no apparent consequences for them, and not even the decency to front up, acknowledge the errors, and say sorry.

Central bank inadequacy and spin (2023)

It used to be true that the Bank had a strong record of policy-relevant research on things around monetary policy, inflation, and the cyclical behaviour of the economy. But no more – just check out how little research they’ve published in those areas in recent years,
…
Learning institutions engage, learning institutions aren’t prickly and defensive, learning institutions don’t just make stuff up, learning institutions don’t claim to regret nothing, learning organisations – especially amid the biggest surprises/policy failures in decades – don’t give keynote addresses like this. And collaborative institutions don’t engage in the sort of defensive abuse Orr is sadly all too well known for.

Reluctantly and belatedly recognising conflicts of interest (2022)

For just over six months now I’ve been on the trail of questionable appointments to the new Reserve Bank Board. Most of the Board members aren’t really fit for office in anything other than ornamental roles – this in the midst of the worst monetary policy failure in decades and the Board being responsible for key appointments and for holding the MPC to account.

Reappointing Orr (2022)
This one’s especially good as Reddell highlights the massive drop in analytical competence since 2017 at the Bank under Orr:

  • the failure to do any serious advance risk analysis on the LSAP instrument, as being applied to NZ in 2020
  • the sharp decline in the volume of research being published by the Reserve Bank, and the associated decline in research capabilities
  • all indications are that he is much more interested in, and intellectually engaged by, things he isn’t responsible for than for the things Parliament has charged him with
  • organisational bloat (think of the 17-20 people in the Communications team or the large number of senior managers now earning more than $400000 pa)
  • the distraction of his focus on climate change, but much more so the rank dishonesty of so much of it – claims to have done modelling that doesn’t exist, attempts to suppress release of information on what little had been done, and sheer spin like last week’s flood stress test.

What might be done about the Reserve Bank (2022)

One person, who preferred to remain nameless (having high level associations with entities the Bank regulates), indicated that I was free to use their comments provided it was without attribution. These were the comments:

The situation is parlous: inept, multi-focussed but wrong focus, terrible judgement, appalling hires, complete absence of appropriate governance, woeful expertise, [backside]-covering of the regulator rather than interaction. I have zero confidence in their leadership, judgement, processes, balance of hires, and particularly governance which has been enabling of dross.  

Submitting on bank capital proposals (2019)

Modelling analysis is embarrassingly bad.
They not only did very little themselves, but largely ignored the vastly greater analytical capabilities of their Aussie counterparts, APRA, who are far more experienced in these matters given the much larger market they have to regulate. APRA must be wondering what it will be like working with Orr and company if a crisis does hit.