Boom times return?

[HotRod]

Oh no it's lunch time for the corporate mouse.

Come back after lunch with some more feedback and tyre kicking on LNG thoughts.

Hot Rod are you asking about iron ore? After China other big importers I think are Japan and Korea. But can do some digging after lunch (or I mean get someone to do some digging).

Interestingly it's a question not often asked. Most questions are about who is China importing from (of which Australia is the top choice), and cost curves (that is who's cheaper, again Australia), and who's grades are better (again Australia but also Brazil).

Signing off for now
Tyre kicker running on mouse wheel (wheeeeeee), wanna be land owner

having a guess, but I would have thought it was Japan, Korea, India and then Indonesia in that order.

I think people need to start thinking of where we export to, not where China imports from, if we are to insulate ourselves from any potential downturn.

No doubt, Rio, BHP, FMG etc know exactly where their secondary market is.

 

[Ausprop]

here you are, google is your friend...

http://www.rba.gov.au/publications/bulletin/2011/mar/1.html

 

[HotRod]

Just checked the 2011 BHP annual report.

Income from China is now 28% in 2011 up from 20% in 2009.

For Rio Tinto income from China is now 31% in 2011 up from 25% in 2009.

So these two would take a hit, but would still survive.

Compare the above two with 97% of FMG's income coming from China. There's some risk there.

 

[Deltaberry]

HAHAHA indeed

i like how commodities are only based on stuff dug out of the ground.

you missed wheat, cattle, sheep, fruit, vegetables.....

Well the question is what does a blip in say 25% of your export market have on the impact of the overall economy?

Some people seem to think it's a case of simple primary school maths where if 10% of your resources market dips, it's only a 2.5% dip on the overall economy and therefore negligible.

If only economics worked like primary school maths, we wouldn't have the contagion issue in Europe. We can sit down here and discuss this topic all day, but reality is coming from different background and different knowledge bases, it's often a pointless discussion. The best thing to do is to take positions based on what you believe, that's all. As some say here, we should put our money where our mouth is.

 

[Melbournian]

And that's the reported ones...

I wonder how many actually sold on the day of the auction, and how many were passed in with nothing but a Vendor's bid?

And just as significant; what was the volume of total auctions compared to last year, and total properties for sale compared to last year?

i sold mine last month - and everybody was just standing around pretending like they didn't care or just came to see. couple of vendor bids and passed in.

although sold after auction if go back 2 years ago. u had guys having bid wars and you get at least an extra 10-20% if it went that way.

 

[redwing]

Interesting read..

Chinese traders fear repeat of 2008 as ore piles up

MOUNTAINS of iron ore at Chinese ports used to be a sign of a booming Australian resources sector, but it has turned into a source of headaches for Chinese commodity traders who are struggling to find buyers for their stockpiles of red dirt.

The Port of Qingdao, through which a seventh of all iron ore imports to China pass, has run out of space to take in more goods. Thousands of trucks and dozens of trains have transported iron ore each day from the port in China's north to hundreds of steel mills to feed the country's insatiable demand for iron ore.

But the number of trucks and trains has declined significantly. Restaurant owners near the port and truck drivers have felt the impact most acutely. The stockpile of ore is now estimated to have hit 15 million tonnes and growing

 

[BayView]

i sold mine last month - and everybody was just standing around pretending like they didn't care or just came to see. couple of vendor bids and passed in.

although sold after auction if go back 2 years ago. u had guys having bid wars and you get at least an extra 10-20% if it went that way.

Yep. In a boom, and with certain properties, auctions will work better from time to time as you described.

But outside of these times; no.

But the agents will still keep on flogging that strategy despite the market condition..

We are still having auctions scheduled here in sleepy Dromana in the dead of winter....it's a joke and I feel sorry for the Vendors.

 

[Indifference]

Boom times Return???? Some aren't so sure...

http://www.news.com.au/money/money-matters/westpac-managing-director-gail-kelly-says-years-of-compound-growth-in-house-prices-are-over-for-good/story-e6frfmd9-1226395093277

The dead cat bounce has been giving investors false hope for centuries.... welcome to reality.

We still haven't hit bottom yet.....

 

[Aaron Sice]

*GASP*

you mean - the boom/bust cycle is dead?

get out of TOWN!

 

[Ausprop]

Boom times Return???? Some aren't so sure...

http://www.news.com.au/money/money-matters/westpac-managing-director-gail-kelly-says-years-of-compound-growth-in-house-prices-are-over-for-good/story-e6frfmd9-1226395093277

The dead cat bounce has been giving investors false hope for centuries.... welcome to reality.

We still haven't hit bottom yet.....

My initial posting was talking more about business conditions, which I confirm are definitely booming, going nuts in fact. It was posted on the basis that this would most likely flow to property.

 

[Indifference]

My initial posting was talking more about business conditions, which I confirm are definitely booming, going nuts in fact. It was posted on the basis that this would most likely flow to property.

It might be going nuts in Perth & in areas able to capitalize on the resources boom but general business conditions across the country are definitely NOT booming.... very far from it actually.

 

[Ausprop]

It might be going nuts in Perth & in areas able to capitalize on the resources boom but general business conditions across the country are definitely NOT booming.... very far from it actually.

to be expected, it's a permanent structural shift in the economy. The RBA says it's all part of the grand plan and we have after all been talking about this since the end of WWII. Businesses in the south east need to adapt to the current conditions becasue this is as good as it gets there now - this is the new norm - a point that the govt is also echoing. When Swann says people need to snap out of it, he is saying that because people are trying to sell ice to eskimos and wondering why they are going broke

 

[Dazz]

people need to snap out of it

Very difficult to do....when you're living in the south east of the country and you've been told all your life that ;

• you are the # 1 city
• you live in the # 1, dare I say it, 'Premier State'
• all major decisions are made in your area
• historically you are the seat of economic power
• historically you are the seat of political power
• all trends must start where you are and 'ripple outwards'

With that type of mentality thrust upon you your entire life....it's difficult to 'snap out of it', and come to the realisation that both the economic and to a lesser extent the political power base is heading west and north, dramatically eroding your national influence.

People don't want to snap out it. They want it to return to the status quo they've enjoyed their entire life.

Unfortunately, mutually financing everyone and insuring everyone and drinking coffee and going to plays and ballet and opera and walking through pristine wilderness forests doesn't bring in the loot anymore.

Providing stuff that is in demand....stuff the world actually needs...that brings in the loot.

Phrases like permanent structure shifts scares the bejesus out of the SE corner. They'd prefer it to be temporary aberrations, a blip, a boom...it won't last, it never lasts.....they'll be put back in their box soon enough and fall behind us like they should do.

I'm afraid folks, that what is happening in both rural Qld and outback WA is not temporary, and it's not a blip. Contracts of 30 years or more have been signed all up and down the full spectrum of materials, with staggeringly onerous penalty clauses for breaking it.

This "boom" ain't going anywhere in my lifetime.....the contracts don't respect property cycles, don't take into account political colours, nor do they really give a fig about any domestic issues you may wish to put up......they are just going to grind away producing cash, further shifting the balance of power away from the SE corner.

 

[HotRod]

Need to go off to the kitchen and get my popcorn for the forthcoming entertainment.........

 

[aussierogue]

Very difficult to do....when you're living in the south east of the country and you've been told all your life that ;

• you are the # 1 city
• you live in the # 1, dare I say it, 'Premier State'
• all major decisions are made in your area
• historically you are the seat of economic power
• historically you are the seat of political power
• all trends must start where you are and 'ripple outwards'

With that type of mentality thrust upon you your entire life....it's difficult to 'snap out of it', and come to the realisation that both the economic and to a lesser extent the political power base is heading west and north, dramatically eroding your national influence.

People don't want to snap out it. They want it to return to the status quo they've enjoyed their entire life.

Unfortunately, mutually financing everyone and insuring everyone and drinking coffee and going to plays and ballet and opera and walking through pristine wilderness forests doesn't bring in the loot anymore.

Providing stuff that is in demand....stuff the world actually needs...that brings in the loot.

Phrases like permanent structure shifts scares the bejesus out of the SE corner. They'd prefer it to be temporary aberrations, a blip, a boom...it won't last, it never lasts.....they'll be put back in their box soon enough and fall behind us like they should do.

I'm afraid folks, that what is happening in both rural Qld and outback WA is not temporary, and it's not a blip. Contracts of 30 years or more have been signed all up and down the full spectrum of materials, with staggeringly onerous penalty clauses for breaking it.

This "boom" ain't going anywhere in my lifetime.....the contracts don't respect property cycles, don't take into account political colours, nor do they really give a fig about any domestic issues you may wish to put up......they are just going to grind away producing cash, further shifting the balance of power away from the SE corner.

Be kind with your power Dazz....yu already seem intoxicated by it.

Not much chip about the easter states i see? I am not sure about the power i have wielded......i have never seen it as an US VS THEM mentality. Not very australian!

But yu run with it muscles. Should go well with your large car.

 

[Deltaberry]

Am mildy amused at your view of the boom.

Not sure about economic power, but with a combined population of say 500,000 people between all the towns which are the direct beneficiaries of long-term contracts, I do wonder how much political power there is. Looking forward to the day when we see a PM or Cabinet Minister of that making.

But I do agree power is heading up north, but probably a bit further north than where you're thinking.

 

[Ausprop]

Am mildy amused at your view of the boom.

It's nothing to feel threatened about and is a good thing for everybody. There will still be nice restaurants and cafes down there and it will be a great place to visit and see the opera house etc, but the focus is (belatedly) elsewhere for now whilst we develop some other parts of the country. if it all falls in a heap the dollar will collapse and it will be back to subsidising holden (even more) to try and keep busy! or bringing in students or whatever - the beauty of a reasonably open economy

 

[Dazz]

Be kind with your power Dazz....yu already seem intoxicated by it.

I have no power whatsoever. I literally have no idea what you are on about.

Not much chip about the easter states i see? I am not sure about the power i have wielded......

Nope, don't care much about the SE corner, but then frankly.....just giving back what we've copped for donkeys.

I seem to recall a wee red line drawn between Adelaide and Brisbane in WW2 when it was getting a bit shaky. Everything SE of that line was worth saving apparently, and everything to the NW of that line was eminently sacrificable to the Japanese. Oh the irony of it all now....

i have never seen it as an US VS THEM mentality.

The top dog never seems to quite know what impact they have on the downtrodden, until they get stomped on themselves once in a while.

Not very australian!

Indeed, we've been feeling that way for decades now.

When I used to live in Sydney as a student, I was part of a conversation that went something like this ;

Sydney businessman : "Where ya from young fella ?"

Me : "The West"

Sydney businessman : "Yeah, I grew up in Penrith as well."

Me : "No, the west" with associated thumb pointing over shoulder.

Sydney businessman : "What you mean Hay or Broken Hill or way out that way ?"

Me : "No, Perth."

Sydney businessman : "Oh, geez mate, you don't come across many of youse fellas."

Me : "See ya loser."

But yu run with it muscles. Should go well with your large car.

You sound just like that Sydney businessman I met all those years ago.

 

[Deltaberry]

No not threatened at all.

In case my earlier posts weren't apparent, I deal exclusively in the resources industry, albeit from a deal-making and numbers side and get paid probably a fair bit more than most hard working miners out there and I thank them for working so hard to keep me in my 10-5 job, which still allows me the occassional/frequent opportunity to sip coffee for an hour here and there during the day and take phone calls about property deals.

My comments on the boom was just the realist side of me talking and are simply based on observations and hear-say from board-level discussions with purchasers these miners work so hard for so their companies can sell to them.

 

[Dazz]

What this country desperately needs is someone with commercial acumen like Marius or Tom to lead it rather than poll-chasing governments and oppositions.

All those with the skillsets are too busy making money and lamenting about the Govt, rather than prepared to roll up their sleeves and get stuck in. Kerry Packer when he went up against those 11 Senators knocked 'em all for a 6, and the next day the headlines were all "Packer for PM".....I'm sure he couldn't think of anything worse having to kowtow to some moaning lefty from Glebe or some pensioner from Blacktown.

And it needs to fire its mainstream journalists and focus on issues that matter and deliver pressure to the government on these issues.

Today on the front page of AFR there's a whole article on Glenn Stevens telling the government it needs to makes hard choices and introduce workplace reforms etc if it didn't want the south east states to stagnate. On the front page of the Fairfax newspaper is some article about banning hugging in a primary school. On the front page of my Murdoch broadsheet - which I haven't bothered to open - is probably an article of a football player.

Absolutely 100% agree with all of that Deltaberry. Unfortunately, {management / politics / the economy} bores a large portion of the population to sleep. They'd much rather watch Collingwood or Masterchef.