A saga of incomprehension

When Treasury made public a memo estimating the direct fiscal loss to the government from the Reserve Bank of New Zealand’s large-scale asset programme (LSAP) is about $10.5 billion, I assumed that was on top of the mark-to-market losses on the LSAP bonds themselves.I was wrong, though neither I nor my colleagues can figure out why or how these two losses on two separate piles of money are supposed to be counting the same thing.The Treasury memo said its $10.5b estimate reflects the fact that the Reserve Bank of NZ (RBNZ) had bought back...