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With the credit crunch gathering further momentum yesterday local sharemarket boss Mark Weldon repeated calls for politicians to set aside party rivalries to formulate a strategy to buffer the economy from the fallout.
Yet another torrid day on global markets ramped up fears the global economy is hurtling towards recession despite efforts to contain the fast-spreading crisis.
With Wall St's Dow Jones Industrial average closing below the 10,000 mark for the first time in four years, the NZX-50 quickly lurched to a three-year low with other markets throughout the Asia Pacific region following suit. The extraordinary conditions were reflected in a shock 100 basis point rate cut by the Reserve Bank of Australia.
Yesterday Weldon said he and David Skilling, chief executive of think tank the New Zealand Institute, were both dismayed by politicians' "lack of a strategic response or even questions about what the strategy is to deal with the repercussions of the financial markets into the real economy".
"Both as individuals and institutions, we are very concerned that the only numbers that really seem to be a political focus are poll numbers rather than the economic ones."
While little could be done to prevent effects of the credit crisis hitting the local economy, Weldon and Skilling believed there were a number of ways in which the impact on New Zealand's productive sector could be mitigated.
"There's clearly a global policy conversation around an appropriate response but a lack of a local conversation.
"The focus should be much more on what things can be done with respect to firms in the real economy to make sure the risks of this and how it plays through are minimised and that when the recession does end we come out of it retooled and stronger."
Weldon said NZX and the NZ Institute were working together to formulate strategy they hoped would be picked up and discussed across the political spectrum. They hoped to release a document in the next couple of days or early next week.
An example of the type of response they were proposing was a temporary elimination of provisional tax for the small and medium- sized enterprises which make up a huge proportion of the New Zealand economy.
With these businesses already facing a shortage of credit and rising borrowing rates, the measure would enable them to manage their cash flow far better with little impact on the tax base.
"Maybe if you stop a few firms going bust you'll actually get a higher tax payment and a reduced welfare cost."
Weldon said the intention was to "drive some consensus".
"Because clearly politicians on both sides are going to try and control the debate to their own agenda."
Yesterday National Party finance spokesman Bill English told National Radio his party was putting together "an economic plan which will provide some stimulus in the shorter term to help people through the recession".
Finance Minister Michael Cullen said the Labour Government was "already massively investing in this economy in terms of its growth and we've done much more on that than National ever did".
A spokesman said the minister looked forward to seeing Weldon and Skilling's proposals "and would read them with interest".
