wondering on everybodys thoughts on our economy . i see our dollar worth more than the US$. Job placement ads r up 2.4% foreign investors are buying up here.read yesterday retail was down by 0.3 % my thinking on the drop is the amount were spending online.because of our high dollar instead of in the shops like we been seeing gerry harvey whinging about 10billion in sales online & hes missing out on correct me if that figure is wrong. I have seen sold signs going up on properties in my area in small amounts of time people are renovating theres plenty of building going on where i live . Even the local car dealer has expanded his business .From what i can see there doesnt seem to be any major problems. Maybe i live in an area where people r moving to when theyre downsizing or getting out of sydney.Everytime i go to the shopping centres they are full of people buying.2 of the local R/E agents 1 has opened another office & 1 has moved to bigger & better premises i just dont see any downturn in my area .. thoughts?
Renovator .... just wait. I agree, I'm not seeing it either yet. 1. The only thing keeping our AUD strong is the strength of our resources sector (e.g. mining). When China stops buying our natural resources, the AUD will tank like a lead balloon vs everything else. 2. Combined with this will be a massive housing downturn .... make no mistake, it will happen. And it is overdue. 3. So we will have Aussie underwater with their mortgages, who work in a retail jobs where the cost of imported goods has gone through the roof ...... 4. Unemployment goes up. Mortgages stop being paid. Foreclosures begin to spike up. Debt gets called in. Think about it. If it becomes a lot harder to go into debt (ie. harder to get a bank loan), do you think the car dealers would be expanding?
- House prices are dropping - Prices for food are increasing heavily - Construction slowed I feel we have a strong economy (Thanks China you have kept me employed) but we only caught the edge of the GFC when it first hit, that's before they started printing money and pouring it in to plug their economies up (US and Europe). THIS helped Australia avoid the extent of the GFC, well momentarily. It has not gone away by any chance. I believe along with other members that Europe will fail first followed closely (12months ish later) by the US. THIS will be the BIG turning point! Every economy around the world will feel it for many years and there wont be no patchy printing money cures. I see a large panic situation with a flood out of the fiat system for the commodities! like people have done for thousands of years. Trillions will be aimed at the commodities market where ill be riding the bull market to high heaven. Mass job losses, property will be bloody cheap! but only for cashed up people. This is because credit will be tight and banks wont lend creating a massive supply of houses but minimal demand from cash strapped investors. (This is the time when i get in! i'm young, 19 actually and ill be buying residential and some ripper acreages out west of Brisbane) I read a property magazine that comes out once a month aimed at negative geared property investors. I read that 'ohhh yes, the market is slowing a bit...but that's normal in a property cycle and you should BUY BUY BUY now!' pfft please. They only look at the statistics over the last 40-50 years when property has exploded! way above what the world believes it should be. Its crazy. What they have not looked at is was is coming...they wont see it until its to late. They will try and sell their 2-5 or more houses they own to try and cover their loans, only to flood the market all at once and give me plenty of lovely bargine's Can you imagine say...300,000 investors, each with 2-5ish properties (random figures here) trying to sell all at once...when credit will be out of the question for the majority of aussie people? it will be some hectic sh*t Ive covered my view of what is to come very briefly. I might be wrong...but that is my 2cents Bellinvest
Your fundamental research above is similar to what ants think in the ant house" the queen ant is well fed, we have new ant-builders coming in, outside food sources are plentiful, etc etc " and one day someone/something walks past and just stomps on the ant house and life carries on. Australian economy left to its own devices and the global economy continuing ( as it currently is ) would be good for our economy ( and when i say good, i mean the crash is only being postponed )- fiat money has encompassed everything around us and less and less honest money around. Its like letting lose a few vampires in the village, after enough time has passed, all the villagers will become vampires too, and who will they than bite for food?? Once it has run full steam and bitten all around ( animals included ) there is no more 'life' around and system will implode. In a nutshell, the ozzie economy and its future will be derailed from the outside, which will create negative repercussions here and there you go. but thats just me..
Just remember that during the GFC in 2008 your government absolutely shat itself and blew that 20 billion dollar surplus into a 50 billion dollar public debt just to keep the ponzi party going. They said at the time that it was a grave threat to the national interest, didn't they? The worst recession of our generation in the wings if we didn't do anything to stop it? Literally throwing cash at people to keep the economy turning? People have VERY short memories it seems. With the floods and cyclones smashing crap out of the infrastructure and no cash in the kitty to fix it (come in mr tax payer!), what chance do you honestly think Australia has when the international markets slip once more under GFC 2.0? Australia (for all it's ego and pride) is too small a market to be of any consequence. Without the perpetual demand for our natural resources we have no local markets. Our economy isn't even 1% of the international GDP which is why when the US sneezes like it did in 2008, we run like a mad panic in the face of getting a cold. The Australian economy is at the mercy of international markets and in case you haven't noticed lately, there's a global currency war underway where little economies like us will be crushed in the stampede to the bottom. If you think we're immune, it might be a good time to look back through Australian history and see what causes our market to tank. Start with the great depression and walk your way forward. It makes for enlightening reading, I assure you. My assumption is that the answer always lies in our past because whilst we always assume 'it's different this time', history always repeats.
Was anyone in Australia made aware that 2 of our major 4 banks were given a bailout of 4billion dollars. A big run on the banks may have occurred if this info became public knowledge. This was at around the time the Aus Government was to guarantee all banking deposits up to one million dollars. We were on the edge and we didn't even know it and I think we are still on the edge and we still don't know it. I got it wrong there. SS know it and thats why they stack silver. The sheep are all in their paddocks waiting for the shepherd to open the gate for greener pastures for future prosperity. Yes Auspm I think it is different this time (not as many people know). Regards Errol 43
+1 IMHO.I always thought of the analogy of having a leak in the boat and instead of patching the hole you create another one next to it. You then tell your passengers don't worry the water will flow out of the second hole. We're still sinking.!!!!! If they used the surplus to build infrastructure during the past two years. We may have lost some it to natural disasters but I believe we'd still have something to show for it. Instead we go for the quick sugar fix by giving it to away so the uninformed will buy plasma TV's etc made in some Asian country. Fast forward ~2 years , we now have people crying about mortgage stress and rising utilities prices yep we're on the fast roads to nowhere.
There is an elephant in the room, and no one is talking about it in Canberra. This government only sees one thing: "Mining is good, so the country is good". Mining fills the government's coffers up. Retail keeps the earnings of Australian households up. Which one is more important? The elephant is that retail is falling all over the country, and these retailers are one of the country's biggest employers. Overseas internet sales are devastating many small businesses, power costs are weighing heavily on businesses and customers. In NSW, during the boom times the Carr government let the electricity system rot while giving the state's money away to their corporate cronies in the form of "consultancy fees" on infrastructure projects that were announced with no intention of ever being implemented. Keneally is now trying to give the power system away for nothing so that when she leaves politics she will be allowed to be a "player". Add this to the Gillard "carbon taxes" and "flood taxes" and the results are clear. Retail is the benchmark for the nation's economic health, retail employs an order of magnitude more Australians than the mining industry, and it employs them in the cities. And it is in trouble. And the government is too stupid to see or to care, because Mining is the only thing that matters. Bad government indeed. If one of the nation's largest employers is in trouble, then people lose their jobs in the cities, mortgages can't be paid, and the spiral starts. It has already begun.
Ok, I'll bite. What should the government do in your opinion? Personally I don't think the government can do anything that will help retail I'm any real way, and I don't think they should even try. It seems to me that one of the lessons from the last few years is that a country can't spend it's way to prosperity though - where does the foreign exchange come from to buy all the crap in the shops given that it's all imported these days anyway?. The problems retail has have nothing to do with the mining boom - in fact without mining the Australian dollar would probably be much lower than it is right now making everything more expensive. What would that do to retail sales do you think?
Easy tiger, the OP asked for opinions and I gave one. I am not the Prime minister, but I hope that she doesn't think the way that you do and throw up her hands because it is "too hard". It is a massive issue for the country, and putting it in the "too hard basket" will not make it go away. I suspect that she will do just that though, and we will suffer the consequences. There probably isn't much that the government can do, but I would like to hear them acknowledge the issue and discuss it, because it is going to have a big impact on us all in terms of job losses.
Dullard will just cry and hand you a happy meal. Don't expect miracles from the bogan ranga, she's not there to improve a damn thing. I have a list of things that the government could do if it had the balls, but it would be a bucket of cold water over the head of the sheeple I think (and very possibly a number of folks here too). It all depends on whether they are serious on fixing the issues, or whether they still want to cuddle up to Keynes and keep giving the idiot masses scooby snacks to buy votes until the wheels fall off completely. Considering the nature of 3 year term politics, I strongly suspect it's the latter.
That's not my point at all. In my opinion the main problem retail has right now is caused by too much meddling by the government already. Why aren't people spending? Because they have too much debt already. Why is that? Because of all the government meddling in the housing market pushing prices up to the point that it takes most of somebodys income for housing. Do you think that more government "help" is the answer?
Retail is a reflection of the indebtedness of the private sector which should be largely left to its own devices. The government position financially is still very strong. Hopefully the government will see how useless bank bailouts overseas were and not go down that path if crisis flares up again.
There you go, you may have the answer there, and it's an insightful one - Perhaps the government should ease up on it's over regulation and let the market take care of itself. I might also mention that if you go back and check my post, I never said anything about wanting the government to "do something about it", I said that it is the unacknowledged "elephant in the room".
Well, you made a really good point that I hadn't though of, so you had an answer to the issue, I didn't.....
Acknowledged - I was honestly curious as to what you thought the solution was however. I have my opinions as you now know, but I'm always interested in other ideas.
