i totally agree with you. Everything cost heaps in autsralia. they just keep pushing the prices up for everything. too much red tape and legislation. The building industry is for one of the prime examples. Followed by consumer products.
Next Interest Rate Movement down?
- Thread starter sash
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i totally agree with you. Everything cost heaps in autsralia. they just keep pushing the prices up for everything. too much red tape and legislation. The building industry is for one of the prime examples. Followed by consumer products.
hmmm not taking part in this argument but Bluestorm I think you got ripped off. There was definately no means test for that $900 handout. Heck the deceased had received it!
TLP
I think sash is on the money... I did not realise how different things were in the non-mining economy until I relocated to Sydney.
The pain in the non-mining sector is pretty evident! I walked into my local shopping center to do my grocery shopping and there was a table with genuine leather belts supposedly discounted by 80% down to $3! I asked the sales guy why so cheap, his response was, "things have been really quiet, just trying to drum things up". This is a theme occuring everywhere in retail as they aggressively slash prices in attempt to boost sales on their books.
I have a friend who works in retail and says it's absolutely **** at the moment. DJ's profit downgrade only reaffirms.
Things are different now to how they have been the last 100 years with falling commodity prices... the RBA have supposedly been able to control inflation with rate rises, but how are they going to control inflation when they can't control commodity prices?
The RBA can't hold down the prices of oil, electricity or energy or any other commodities.. these are going to impact on our cost of living. Inflation is going to run rampant over the next decade, no doubt... so tell me how increasing interest rates are going to help us deal with the increases costs of living? There is a huge shock coming from increases living costs.
The pain in the non-mining sector is pretty evident! I walked into my local shopping center to do my grocery shopping and there was a table with genuine leather belts supposedly discounted by 80% down to $3! I asked the sales guy why so cheap, his response was, "things have been really quiet, just trying to drum things up". This is a theme occuring everywhere in retail as they aggressively slash prices in attempt to boost sales on their books.
I have a friend who works in retail and says it's absolutely **** at the moment. DJ's profit downgrade only reaffirms.
Things are different now to how they have been the last 100 years with falling commodity prices... the RBA have supposedly been able to control inflation with rate rises, but how are they going to control inflation when they can't control commodity prices?
The RBA can't hold down the prices of oil, electricity or energy or any other commodities.. these are going to impact on our cost of living. Inflation is going to run rampant over the next decade, no doubt... so tell me how increasing interest rates are going to help us deal with the increases costs of living? There is a huge shock coming from increases living costs.
Bon - are you trying to say if inflation exceeds 3%, the RBA will leave it unchecked?
I don't know what's scarier - inflation or high costs of living. Actually I do - the former.
I don't know what's scarier - inflation or high costs of living. Actually I do - the former.
http://www.news.com.au/business/bre...orecast-rate-cut/story-e6frfkur-1226095432967
looks like banks are starting to bet on a downward rate movement - as with all MSM articles take with a pinch of salt, I'm sure another article somewhere is saying 3 up by Monday lunch.
looks like banks are starting to bet on a downward rate movement - as with all MSM articles take with a pinch of salt, I'm sure another article somewhere is saying 3 up by Monday lunch.
Yeah. I know it's paradoxical.
Unfortunately the RBA can't do much to control inflation by levering interest rates when it's commodity prices that are pushing inflation up... If oil goes to $200/barrel and we pay more for our energy, transport and food, how does rising interest rates help us? It doesn't, it only hurts us more as we struggle to keep up with the increased costs of living.. I'm sure if you were to graph how our disposable income was being spent, you'd see more and more of it being allocated to essentials such as transport, energy and food, less of it being spent on life's luxuries.
It's been easy to control inflation with the lever of interest rates when commodity prices have been in a downtrend, but the RBA's model is so ****ing broken in this situation it's not funny. There is a very good chance they could cripple the non-mining sector of the economy and we'll have one part of the economy in a recession while another is booming.
The Government knows it too of course, but they're not telling the truth... extra taxes on the mining sector is just beyond a joke considering how small a percentage of our GDP it actually makes up, especially in comparison to the banking & financial services sector! Why not super taxes for banks and finance?
The Government are skirting around the real underlying issue at hand.. probably why they are making up all these ******** taxes for the mining economy, to try and slow them down to keep the non-mining sector alive and out of a recession.
Unfortunately the RBA can't do much to control inflation by levering interest rates when it's commodity prices that are pushing inflation up... If oil goes to $200/barrel and we pay more for our energy, transport and food, how does rising interest rates help us? It doesn't, it only hurts us more as we struggle to keep up with the increased costs of living.. I'm sure if you were to graph how our disposable income was being spent, you'd see more and more of it being allocated to essentials such as transport, energy and food, less of it being spent on life's luxuries.
It's been easy to control inflation with the lever of interest rates when commodity prices have been in a downtrend, but the RBA's model is so ****ing broken in this situation it's not funny. There is a very good chance they could cripple the non-mining sector of the economy and we'll have one part of the economy in a recession while another is booming.
The Government knows it too of course, but they're not telling the truth... extra taxes on the mining sector is just beyond a joke considering how small a percentage of our GDP it actually makes up, especially in comparison to the banking & financial services sector! Why not super taxes for banks and finance?
The Government are skirting around the real underlying issue at hand.. probably why they are making up all these ******** taxes for the mining economy, to try and slow them down to keep the non-mining sector alive and out of a recession.
Down or Up ?
Its lovely to see how many opinions there are on future rate hikes or declines. A couple of days ago there was something like a 30 per cent chance of a RBA rate deduction during the rest of this year.
Only two weeks ago one respected financial source reported that Australia’s GDP could rise by March quarter next year to a whopping 6.2 per cent. While that would be good for our patchwork economy it would likely lead to one or perhaps more rate increases.
However, since then there has been more uncertainty in the US, Greece, Spain and Italy and a carbon tax here, but no cyclones, floods or earthquakes. So, let’s see what next week brings.
Its lovely to see how many opinions there are on future rate hikes or declines. A couple of days ago there was something like a 30 per cent chance of a RBA rate deduction during the rest of this year.
Only two weeks ago one respected financial source reported that Australia’s GDP could rise by March quarter next year to a whopping 6.2 per cent. While that would be good for our patchwork economy it would likely lead to one or perhaps more rate increases.
However, since then there has been more uncertainty in the US, Greece, Spain and Italy and a carbon tax here, but no cyclones, floods or earthquakes. So, let’s see what next week brings.
For the property armageddonistas, this must be devastating news.
No, like I said, rates down or up won't matter. Rates Up and property will correct, as there are also other cost of living expenses impacting peoples borrowing power. Rates down from a low 4.75%, and it means the economy is in real trouble, and property will correct.
Westpac changes tack: rates to fall
If they do need to drop to 3.75%, then the economy is really messed up. No stimulus package this time to save property.
Anyway, who relies on the RBA and economist experts for information anyway? Apparently the Somersofters do, as they keep saying why listen to the D&G when I can listen to the "experts" who know better. The experts keep changing their opinion quicker than the direction of the wind. I'm sure they will be surprised when Australia heads into recession as well, when all along they have been predicting a boom.
Sorry, back in Dec 2012 after the carnage the next 17mths.
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BECAUSE THE GOVERNMENT DOESNT HAVE THE MONEY TO DO IT AGAIN.
The kitty has already been spent.
Of course lowering interest rates will act as a cushion, it will also help in lowering the AU$ which will act as a further cushion.
But will this be sufficient??????
Rates at 3.75% is still 3.75x what the rest of the world is, doesn't exactly instill fear....
a 1% interest reduction for someone on a 500k PPOR mortgage is a $417 after tax increase in their disposable income. Given that consumer spending accounts for ~60% of our economy, then this theoretical household is spending an additional $250 per month. No small dice when applied more generally.
However, I still don't think we are quite at the point where we will be getting 4 x 0.25% reduction of IR's in 2012. My cashflow would be very appreciative of it however.
However, I still don't think we are quite at the point where we will be getting 4 x 0.25% reduction of IR's in 2012. My cashflow would be very appreciative of it however.
You may be right,Economists only see it the way the numbers are in a set time frame,but anyone with their eyes wide open may see a different picture,but long term just print more money,,btw why walk away till dec without different opinions we would all be just sheep..No, like I said, rates down or up won't matter. Rates Up and property will correct, as there are also other cost of living expenses impacting peoples borrowing power. Rates down from a low 4.75%, and it means the economy is in real trouble, and property will correct.
Westpac changes tack: rates to fall
If they do need to drop to 3.75%, then the economy is really messed up. No stimulus package this time to save property.
Anyway, who relies on the RBA and economist experts for information anyway? Apparently the Somersofters do, as they keep saying why listen to the D&G when I can listen to the "experts" who know better. The experts keep changing their opinion quicker than the direction of the wind. I'm sure they will be surprised when Australia heads into recession as well, when all along they have been predicting a boom.
Sorry, back in Dec 2012 after the carnage the next 17mths.
Unless they are mining coal used in Aus....
Also, what makes you think that China will keep on building ghost cities?
Sure they have money but they can use it to buy overseas assets
Look at what happens to towns when a major employer closes shop
http://www.abc.net.au/news/stories/2011/07/08/3264195.htm?site=newcastle
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