There today on TV was our Prime Minister, Julia Gillard saying her government’s proposed carbon tax is ok, as the economy can afford it. She referred to planned mineral and resource infrastructure investments totalling some $430 billion to support our growing trade with China and the Pacific region. The same rhetoric is also coming from the Reserve Bank stating that our economy is strong.
So why does it feel we are close to a recession. Although we have close to full employment, a shortage of skilled labour and robust wages, consumers just don’t wish to spend their now high savings. As a result house prices are falling as the worry has been interest rates are on the rise making repayments harder for families to meet. But for the first time, economists are forecasting a substantial cut in interest rates during the next 12 months. Dr Bill Evans from Westpac last Friday anticipates a 1 per cent base rate cut in 12 months. But in comparison we don’t trade that much with America, Italy, Greece Spain and the UK. Are these counties with their weak markets likely to affect our economy in the next few months?
So is this the time to be considering a rental investment property purchase or battening down the hatches. Any where would you invest? The mining resource towns and states of WA and Queensland or closer to home so you can keep an eye on your investment, just in case of trouble.
So why does it feel we are close to a recession. Although we have close to full employment, a shortage of skilled labour and robust wages, consumers just don’t wish to spend their now high savings. As a result house prices are falling as the worry has been interest rates are on the rise making repayments harder for families to meet. But for the first time, economists are forecasting a substantial cut in interest rates during the next 12 months. Dr Bill Evans from Westpac last Friday anticipates a 1 per cent base rate cut in 12 months. But in comparison we don’t trade that much with America, Italy, Greece Spain and the UK. Are these counties with their weak markets likely to affect our economy in the next few months?
So is this the time to be considering a rental investment property purchase or battening down the hatches. Any where would you invest? The mining resource towns and states of WA and Queensland or closer to home so you can keep an eye on your investment, just in case of trouble.