I dont normally agree with you HG but I agree that densities are going to increase dramatically.
Recession likely in Australia
- Thread starter greedy saffa
- Start date
I dont normally agree with you HG but I agree that densities are going to increase dramatically.
And right near my train stations first please.. 10 story zoning oh please oh please.. prays to zoning gods (but not allowed to sleep with them).
The keys ingredients to a recession are high unemployment and low government spending. Right now both these are near cyclic highs.
However, it is quite obvious that we cannot maintain such levels forever so the market has to come off at some stage. The severity of the slow down will be determined by government policies.
However, it is quite obvious that we cannot maintain such levels forever so the market has to come off at some stage. The severity of the slow down will be determined by government policies.
c'mon guys, you;re smarter than this surely?
The price of oil is in every product you buy - from vegetables to plasma screens.
It doesn't matter whether you use public transport or not (and for those that do, buses run on diesel the last time I looked), the fact is you will pay for higher fuel prices in every product or service you buy.
Higher oil prices + govt and private sector spending = higher inflation pressure
Inflation pressure leads to interest rate hikes.
High interest rates, default on credit and low consumer spending pushes us to a recession.
I'm starting to feel like Keating - next I'll be white boarding for you.
The price of oil is in every product you buy - from vegetables to plasma screens.
It doesn't matter whether you use public transport or not (and for those that do, buses run on diesel the last time I looked), the fact is you will pay for higher fuel prices in every product or service you buy.
Higher oil prices + govt and private sector spending = higher inflation pressure
Inflation pressure leads to interest rate hikes.
High interest rates, default on credit and low consumer spending pushes us to a recession.
I'm starting to feel like Keating - next I'll be white boarding for you.
It's not so obvious though.
It's a no brainer for a place like England. They import energy, and they import food. England is in financial trouble.
The US is obviously in trouble now due to their energy use and massive debt levels. But they still have a strong manufacturing industry of quality products that China can't easily copy, plus the US is the worlds major food producer.
While Australia is a net oil importer, we are a massive net energy exporter through coal, gas, and uranium. Australia is also one of the worlds biggest food exporters. That's why Australia hasn't been hit as hard as other places.
I don't think it's certain we will go into recession. There is so much money flowing into Australia. I think it will continue to be a two speed economy. Go to Gunnedah, or Chinchilla, or Emerald, or Geraldton, and you will see places doing better than they ever have.
See ya's.
Gotta agree with you TC
Unemployment is still really low, interest rates are going up due to the strength of the economy, no subprime problems here etc.
Our interest rates are actually going in the opposite direction of the US, even though people will try to convince you that we follow them...
If a recession is 2 quarters of negative growth, then I think we're miles off a risk of even 1 quarter.
Of course, doesnt mean it WONT happen, but the signs really arent there at the moment.
If you want to have a really fundamental look, stop looking at stats and figures and go for a drive. There's new apartments and housing going up all over the place. The bay in Melb is a big conga line of cargo ships, the freeways are clogged with people trying to get to work. Employers are finding it hard to find people to work for them. Shops are packed.
Open your eyes people. These are the signs of prosperity, not impending disaster.
Unemployment is still really low, interest rates are going up due to the strength of the economy, no subprime problems here etc.
Our interest rates are actually going in the opposite direction of the US, even though people will try to convince you that we follow them...
If a recession is 2 quarters of negative growth, then I think we're miles off a risk of even 1 quarter.
Of course, doesnt mean it WONT happen, but the signs really arent there at the moment.
If you want to have a really fundamental look, stop looking at stats and figures and go for a drive. There's new apartments and housing going up all over the place. The bay in Melb is a big conga line of cargo ships, the freeways are clogged with people trying to get to work. Employers are finding it hard to find people to work for them. Shops are packed.
Open your eyes people. These are the signs of prosperity, not impending disaster.
&&&&&&&&&&&&&&&&
Dear Saileh,
1. Your observations are likely to apply "now" as we speak but probably not so, in the near future as both the RBA and the Australian Federal Treasury have projected the unemployment figures to increase to 4.75% by end of 2008, following the recent slowing down of the Australian Economy.
2. Will it likely further increase to 5.5% or/and rise to more than 8% subsequently as during the 1991 "Recession that Australia needs to have", after the current Resource Boom is "effectively" over by 2010 and before the present ALP Federal Govt Office term expires?
3. So far, KR and his ALP Party have suffered a 10% drop in the local opinions poll. I believe that some Australians are now beginning to see through their "blaming"/ "scapegoating" political game as one of of a "paper- tiger" or/and an "ineffective" governence.
4. As more small businesses start to fold in Australia and major companies relocate their office operations out of Australia in search of cheaper labour costs eslewhere in Asia, future employment opportunities in Australia are likely to fall heavily in the near future and so will its unemployment figures.
5. I personally believe at this point in time that if RBA is allowed to freely and independently manage the present ongoing slowing down of the Australian Economy, on its own, without any undue influences exerted by the ALP Federal Govt/Treasury, the risks of RBA able to slow it down into a soft landing without neccessarily stalling it into an official Recession, is far lower than the alternative scenario involving direct "interference"/intervention by the Australian Federal Govt.
6. For your further comments and discussion, please.
7. Thank you.
Cheers,
Kenneth KOH
Last edited:
Kenneth, what was clear up until the Fed Budget at least, is the Government was at pains to let the RBA do its job. The banks actually made mention of the pressure they faced under the previous government about IR and the attitude by the new government to let the banks respond to their funding cost increases.
The fact that Swan et al, constantly use the term keeping downward pressures on interest rates doesn't mean they have been active in pressuring the RBA
Additionally, its political pressure on the banks not to raise rates independently of the RBA have been token to say the least, as they have tried to portray these rises as Howards & Costello's fault?
How this changes from here, who knows, but I am not sure your characterisation of an interfering Fed government is correct.
KR is kinda like the lord mayor of Melb. John So.
A real cult figure, everyone loved him, but he hasnt really done a good job. Doesnt turn up to meetings, spends a fortune on self promotion etc.
And now the tables are turning and he's likely to get the boot soon.
People chose style over substance, and I suspect that KR is showing signs of this too. So far, the apology, summit etc have been easy pickings. But no real sign yet of policies to tackle genuine issues, esp now that we're wall to wall ALP.
A real cult figure, everyone loved him, but he hasnt really done a good job. Doesnt turn up to meetings, spends a fortune on self promotion etc.
And now the tables are turning and he's likely to get the boot soon.
People chose style over substance, and I suspect that KR is showing signs of this too. So far, the apology, summit etc have been easy pickings. But no real sign yet of policies to tackle genuine issues, esp now that we're wall to wall ALP.
Yes Beth Morgan could be regarded as a bit of a hottie. Not so sure about her lover boys though.
Couldn't help but not comment on Beth as I did an google image search on Beth to answer that same question when she was found guilty a few weeks back. (Yes, I realise that is sad...)
She scrubbed up Ok in court but not sure if she gets to the hottie mark...
I have just looked at the title of this thread and we are well and truly off topic
It's a bubble, not a boom...
************************
Dear Buzzlightyear,
1. Since the ALP Federal Govt assume its office term in November 2007, the RBA has further increased interest rate twice, by 2 x 0.25% rate increases.
2. Despite their own reportedly "hawkish" anti-inflation rhetorics by KR, Wayne Swan and Lindsay Tanner, the ALP Federal Govt has continued with its own "inflationary" tax cuts and overall increased spending by the Federal Govt, with its reportedly "non-inflationary" Budget, at a time when it was officially deemed neccessary for the Australian Economy to be slowed down midst the continuing monthly high inflation figures reported ands soaring petrol prices.
3. Seen from a different perspective, despite repeated warnings from the new Australian Federal Treasurer, the major banks have all simply ignored Wayne Swan's public warnings and proceeded with their additional or/and higher bank rate hikes subsequently.
4. The ALP Federal Govt has further refused to cut down its own overall Budget spending and tax cuts programme in 2008, (even though they were clearly "inflationary" in nature as has been criticised by Ken Henry), "preferring" instead for the RBA to increase its present interest rate further, as the key tool to curb down the existing high inflation rate.
5. The RBA has deemed it fit to keep the official cash rate steady at 7.25% in its April, May and June 2008 meetings. It has repeatedly said that there is sufficient signs on the ground that Australian Economy is presently slowing down at the required pace, as it has desired and last envisaged previously, given its various cumulative interest rate increases in the past.
6. Yet Lindsay Tanner has continued to talk up the "inflation", and of further interest rate increases to curb down the inflation, even after its own "inflationary" Budget has been released.
7. No, I do not see Fuelwatch measure as an effective tool to lower down petrol prices in WA at all.
8. Once implemented across Australia-wide, I am personally inclined to think that petrol prices are more likely, to rise higher than fall, in the other Australian States too per se eventually, all things being equal.
9. This is as per what is presently being observed in WA.
10. For your further comments and discussion, please.
11. Thank you.
Cheers,
Kenneth KOH
Last edited:
&&&&&&&&&&&&&&&&&&&
Dear Tubs,
1. I personally believe that your so-called "signs of prosperity" in WA, will eventually give way to the fast emerging new signs of a slowing down Australian Economy in due course.
2. Already, the Perth property market has suddenly went quiet all of sudden since 2007, to date, reportedly after taking some breather. Now, there are reportedly more sellers than buyers under the present Perth property market conditions today with increased house listings for sale and a longer time taken to achieve an effective house sale.
3. Likewise, of late, similar markets trends are being observed in many housing markets across the various capital cities in Australia too.
4. It's like trying to talk about the previous 2003 Melbourne boom retrospectively, back then during the 2002 period when many cranes were reportedly seen all over the Docklands and various Melbourne CBD areas.
5. Eventually, some of high-rise projects were left un-completed and apartment prices in the Dockland areas started to fall down as a result of the units over-supply in the area when I subsequently visited Melbourne CBD area in 2004.
6. When the Australian Economy was still fast expanding in 2007 under the Liberal Coalition Govt, the annual inflation level was only hovering around less than 4% pa.
7. Today, with the ALP Federal Govt in charge, RBA is reportedly trying to slow down the Australian Economy down to 2.25% in 2008 as compared to the 4.5% economic growth achieved in 2007, with its inflation starting to hover around 4.2% level.
8. Saved for the ongoing Resource Boom which is expected to peter out in 2010 and given the existing high inflation pressures which are reportedly imported from overseas, there are many indications that the Australian Economy is presently slowing down to a certain extent, as agreed by the RBA when it decided to continue to hold its official cash rate and interest rate steady at 7.25% successively, over the last 3 months.
9. More recently, the Australian National Airline, Qantas has reportedly cancelled some of its less profitable flights routes from Sydney-Goldcoast as well as from Cairns-Toyko or/and to the other Japanese cities, as a result of the continuing soaring fuel prices.
10. For your further comments and discussion, please.
11. Thank you.
Cheers,
Kenneth KOH
Last edited:
***********************
The Western Australian Newspapers today further reports that "Swan defends tax cuts despite fresh RBA warning"
http://www.thewest.com.au/default.aspx?MenuID=2&ContentID=78797
Cheers,
Kenneth KOH
Anyone still think a recession unlikely in Australia?
Anyone recall me saying earlier that the concept of being "decoupled from the global economy" is only Wayne Swan's rhetoric?
My simplified version so Swanny can get the message (if I were Keating I would demonstrating this as bottles of gin)
USA borrows from China
to consume goods made from the Chinese
paying them back with the money it has borrowed
which China uses to buy our iron ore (and other minerals)
So when China asks us, Australia to put ore shipments on hold (which it did this week) because it is slowing production in its factories (which are producing to 12 month forecasts)
Because the US is not buying
Where do you think that leaves us?
Yep - at the bottom of the sh*t pile.
Because, the fundamentals of economy (as Mr Swan is fond of saying - although I doubt if understands what the "fundamentals are) include three major things:
1. We dig stuff out of the ground and we sell it to the Asians
2. We grow stuff or milk it and sell it to the Asians
3. We open our doors to tourists
Yes - that is it ladies and gentlemen. Apart from that, we do not lead the world in any provision of services, research, manufacturing, renewable energy sources, telecommunications (Vietnam has faster broadband), etc.
We dig it up, we grow it, we sell it.
And when no one is buying - we grind to a halt.
They call it a recession.
And here endeth the lesson.
p.s...
Most of you may be too young to remember the last one - but it is not pretty.
And there is only one way out - spend your way out!!!
So get out there and consume like locusts!!!
Alternatively, take it on the chin, watch terrestrial TV channels - even better, get out there and go for a walk, do all the good wholesome things that come for free. Reconnect with your children and families by communicating with them rather than buying them off with presents to keep them quiet in shopping malls while you ponder your next dollar on the pokies.
In short - get back to basics people - and I'll see you the other side
Anyone recall me saying earlier that the concept of being "decoupled from the global economy" is only Wayne Swan's rhetoric?
My simplified version so Swanny can get the message (if I were Keating I would demonstrating this as bottles of gin)
USA borrows from China
to consume goods made from the Chinese
paying them back with the money it has borrowed
which China uses to buy our iron ore (and other minerals)
So when China asks us, Australia to put ore shipments on hold (which it did this week) because it is slowing production in its factories (which are producing to 12 month forecasts)
Because the US is not buying
Where do you think that leaves us?
Yep - at the bottom of the sh*t pile.
Because, the fundamentals of economy (as Mr Swan is fond of saying - although I doubt if understands what the "fundamentals are) include three major things:
1. We dig stuff out of the ground and we sell it to the Asians
2. We grow stuff or milk it and sell it to the Asians
3. We open our doors to tourists
Yes - that is it ladies and gentlemen. Apart from that, we do not lead the world in any provision of services, research, manufacturing, renewable energy sources, telecommunications (Vietnam has faster broadband), etc.
We dig it up, we grow it, we sell it.
And when no one is buying - we grind to a halt.
They call it a recession.
And here endeth the lesson.
p.s...
Most of you may be too young to remember the last one - but it is not pretty.
And there is only one way out - spend your way out!!!
So get out there and consume like locusts!!!
Alternatively, take it on the chin, watch terrestrial TV channels - even better, get out there and go for a walk, do all the good wholesome things that come for free. Reconnect with your children and families by communicating with them rather than buying them off with presents to keep them quiet in shopping malls while you ponder your next dollar on the pokies.
In short - get back to basics people - and I'll see you the other side
fortunately there is still more than ample demand for energy due to dwindling global reserves and the greenhouse effect (in the case of uranium). now if only we were smart enough to produce uranium from cradle to grave i.e. dig it up, ship it, return and store. The world would be our oyster. Unfortunately the public is nearly as scared of that prospect as west aussies are of daylight savings.
Dear Greedy Saffa,
1. With the wisdom gained from hindsight, I agree with you that the risks of Australia falling into an Recession in the near future, is now much higher than it was, a few months ago, given the worsening of the global financial situation and the spreading out of the ill-effects as a result of the slowing down in demand for goods and services from the American Economy as well as the present slowing down of demand from China and India for the various commodities produced by Australia. .
2. Just as you have suggested, I believe that both Kevin Rudd's ALP Govt and the RBA under Glenn Steven's leadership, are now likely to get Australians to spend all their way out of this impending Recession, which is about to befall over Australia, through this week's 1% Interest Rate Cut and the fast-forwarding its A$20 Billion Infrastructural Fund spending within the FY 2008/2009 period.
3. Admittedly, the present economic situation in Australia is still far more favourable than those in the USA, UK and most of the OECD countries at this point in time, despite the faster than expected slowing down of the Australian Economy over the last few months.
4. By daring to cut down its official Interest Rate by 1% decisively to help stabilise the Australian Economy and the local financial situation midst the worsening global financial situation and the spread of the existing world-wide panic fears, I believe that the present RBA under Glenn Steven's leadership has creatively and courageously demonstrated to the entire Western world its own effective economic management leadership.
5. Consequently, I am still hopeful that perhaps the RBA under Glenn Steven's leadership, may still be able to "re-jumpstart" the rapid slowing down Australian Economy again on time, at the very last minute and to finally achieve a soft landing for Australia, in the near future.
6. For your further comments and discussion, please.
7. Thank you.
regards,
Kenneth KOH
1. With the wisdom gained from hindsight, I agree with you that the risks of Australia falling into an Recession in the near future, is now much higher than it was, a few months ago, given the worsening of the global financial situation and the spreading out of the ill-effects as a result of the slowing down in demand for goods and services from the American Economy as well as the present slowing down of demand from China and India for the various commodities produced by Australia. .
2. Just as you have suggested, I believe that both Kevin Rudd's ALP Govt and the RBA under Glenn Steven's leadership, are now likely to get Australians to spend all their way out of this impending Recession, which is about to befall over Australia, through this week's 1% Interest Rate Cut and the fast-forwarding its A$20 Billion Infrastructural Fund spending within the FY 2008/2009 period.
3. Admittedly, the present economic situation in Australia is still far more favourable than those in the USA, UK and most of the OECD countries at this point in time, despite the faster than expected slowing down of the Australian Economy over the last few months.
4. By daring to cut down its official Interest Rate by 1% decisively to help stabilise the Australian Economy and the local financial situation midst the worsening global financial situation and the spread of the existing world-wide panic fears, I believe that the present RBA under Glenn Steven's leadership has creatively and courageously demonstrated to the entire Western world its own effective economic management leadership.
5. Consequently, I am still hopeful that perhaps the RBA under Glenn Steven's leadership, may still be able to "re-jumpstart" the rapid slowing down Australian Economy again on time, at the very last minute and to finally achieve a soft landing for Australia, in the near future.
6. For your further comments and discussion, please.
7. Thank you.
regards,
Kenneth KOH
Pretty much spot on there.
One thing that could come into effect in 12 months when everything has calmed down, is that all the resource boom expansion that will now get cancelled. The big supply response that was coming won't happen now. Lots of metals are now at below cost. Mines will shut down, deap sea oil rigs wont work. Farm input costs are out of control. Farmers will cut inputs, or turn to legumes, which will reduce production. Debt laden farmers won't get finance to grow the next crop. Could set things up for a second leg of the resource boom, as this part is certainly over.
Or maybe not.
And the crash in the A$ is a fantastic thing for exporters.
See ya's.
Last edited:
