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Australia Manufacturing Collapses As Commodity Supercycle Stalls;

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snip

Oz was meant to be immune.

its an upside down world.

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Surely as they have no national debt and they have their own currency, the Oz government will be able to devalue and bail out the banks until they're choking on the money. They could QE until about 2050 and get away with it.

If the UK population is too stupid to stop the politicians doing it, they certainly won't stop them in Oz.

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Surely as they have no national debt and they have their own currency, the Oz government will be able to devalue and bail out the banks until they're choking on the money. They could QE until about 2050 and get away with it.

If the UK population is too stupid to stop the politicians doing it, they certainly won't stop them in Oz.

It's QE that's killing the demand for commodities. Exporters like China have to keep printing yuan and artificially holding down IRs to maintain their dollar peg, which equals local inflation and runaway property bubbles. Bernanke is crushing them to death.

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It's QE that's killing the demand for commodities. Exporters like China have to keep printing yuan and artificially holding down IRs to maintain their dollar peg, which equals local inflation and runaway property bubbles. Bernanke is crushing them to death.

He's certainly going to cause some severe economic problems globally, potentially he might end up killing more people than Hitler / Mao / Stalin put together if food prices get out of control.

Still at least he's helping Wall Street to line their own pockets so it's not all bad news.

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Surely as they have no national debt and they have their own currency, the Oz government will be able to devalue and bail out the banks until they're choking on the money. They could QE until about 2050 and get away with it.

If the UK population is too stupid to stop the politicians doing it, they certainly won't stop them in Oz.

Possibly not. Australia has the 11th highest net external debt (public + private) of all nations, and are higher up the list if you look at things per capita. Ozzie debt is hidden in private institutions such as the banks. Similarly, people are up to their eyeballs in private debt. As for future public debt, the government services are structured on the good times only getting better. It's very hard to reduce spending commitments, as people get upset when the manna from heaven stops.

In my opinion, Australia was ruined by the last half of the Howard government and the Rudd/Gillard Labor government that followed. The change in this country over the past dozen years or so has been extraordinary.

Edited by Tiger Woods?

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Possibly not. Australia has the 11th highest net external debt (public + private) of all nations, and are higher up the list if you look at things per capita. Ozzie debt is hidden in private institutions such as the banks. Similarly, people are up to their eyeballs in private debt. As for future public debt, the government services are structured on the good times only getting better. It's very hard to reduce spending commitments, as people get upset when the manna from heaven stops.

In my opinion, Australia was ruined by the last half of the Howard government and the Rudd/Gillard Labor government that followed. The change in this country over the past dozen years or so has been extraordinary.

Exactly right. Its all these morons like Krugman who say about Spain, its essentially a good economy, with no deficit before 2007, unsustainable debts confined to the banking system. What they forget is money is cycled and re-cycled round the economy. It may well be 'created' by private banks, but as it gets spent and re-spent on various things, half of it ends up in govt coffers via taxes in the end, and if they depend on it, and it stops, they need to make up the shortfall by public borrowing. You cannot seperate public and private debt. A unit of privately created credit spends exactly the same as a unit of currency.

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It's going to be interesting to see how the RBA reacts, the dollar is way to high......But i sense they are actually maintaining these heights to attract hot money seeking yield..

Domestic saving over here is worse than the UK. Are we going to see 2.5 dollars to the pound, it's a long way back, i do not see it, thats a 40% drop in the dollar against the British peso.....

House prices over here are crazy still, if they drop rates, it will inflate further, the costs of living is so so high. As an example, and average wage over here is at best $23 bucks an hour...the average rent must be $350 bucks a week for something not quite great.....That would be over 45% of your take home pay, if you have a job...

But the Ozzy's are very protectionist over jobs, the stores are filled with local Ozzy kids working the tills..

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It's going to be interesting to see how the RBA reacts, the dollar is way to high......But i sense they are actually maintaining these heights to attract hot money seeking yield..

Domestic saving over here is worse than the UK. Are we going to see 2.5 dollars to the pound, it's a long way back, i do not see it, thats a 40% drop in the dollar against the British peso.....

House prices over here are crazy still, if they drop rates, it will inflate further, the costs of living is so so high. As an example, and average wage over here is at best $23 bucks an hour...the average rent must be $350 bucks a week for something not quite great.....That would be over 45% of your take home pay, if you have a job...

But the Ozzy's are very protectionist over jobs, the stores are filled with local Ozzy kids working the tills..

You are obviously not in Perth where all the stores are manned by SE Asian students and it is believed to be a legal requirement that you have to be Indian to work in a petrol station, and an Irish under 30's female to work in a cafe!

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This issue of a slow down in Australia has two other factors too. Take a look at this.

Unemployment and Employment

Australia is beginning to see rises in unemployment with the seasonally adjusted numbers for March rising by 25,900 which raised the unemployment rate from 5.4% to 5.6%. Also the seasonally adjusted employment figures which are a leading indicator for future activity fell by 36,100 to 11.59 million.

Putting all this another way.

Aggregate monthly hours worked decreased 5.0 million hours to 1,627.3 million hours.

The population for reference purposes has just passed 23 million.

Australia’s banks

Union Bank of Switzerland has put out a research note entitled “Welcome to the great bank bubble of 2013” . From this I note that Australian banks now represent four of the world’s eleven largest banks by market capitalisation. What could go wrong?

Although at one point this report does read like a cheerleader for Aussie banks.

They are profitable, resilient, well capitalised, well managed, shareholder focused and have a very strong industry and regulatory structure.

I think that we may well be returning to that bit don’t you?

http://www.mindfulmoney.co.uk/wp/shaun-richards/even-commodity-rich-australia-now-faces-an-economic-slow-down/

Ah so Australia's banks have been booming! What could go wrong?

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I've worked with all four of the major Aussie banks. One is great, stable, and well run. Two are a bit middling, not bad, but have weak bits that if the downturn hits that sector first (i.e. before they can say its a global thing and force the gvt to help), could be in trouble. One is a basket case managerially.

And no, I am not saying which one is which.

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I've worked with all four of the major Aussie banks. One is great, stable, and well run. Two are a bit middling, not bad, but have weak bits that if the downturn hits that sector first (i.e. before they can say its a global thing and force the gvt to help), could be in trouble. One is a basket case managerially.

And no, I am not saying which one is which.

Basket case = NAB?

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Basket case = NAB?

erm - when I say I am not saying, that is not cancelled out by a guessing game! Now if HBOS was still there.....

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  • 243 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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