Guest The Pom Queen Posted February 18, 2016 Share Posted February 18, 2016 The Australian economy is facing hazards unlike any seen in more than 20 years, and is starting from a position of income weakness, according to a frank new report. It means incomes and the tax base will grow much slower than governments have become used to, making budget repair harder at the federal level. The Committee for Economic Development of Australia (CEDA) - one of the country's most respected think-tanks - has released its annual Economic and Political outlook for 2016. Australia is about 70 per cent of the way through its fall from the peak of the mining construction boom. It predicts business confidence will be a "significant issue" this year, because even though Australia's economic reality is rosier than business surveys suggest, it will likely be negatively influenced by the politicking of the federal election "This has the potential to have serious implications for the economy," CEDA chief executive Stephen Martin has warned. The report says Australia is about 70 per cent of the way through its fall from the peak of the mining construction boom in 2012, with about 60 per cent of the consequent job losses already incurred. It also says drivers of the residential construction boom appear to be receding, though any "significant pullback" is unlikely before 2017. Commonwealth Bank chief economist Michael Blythe, who prepared the economic forecasts for the report, says despite the economic headwinds facing Australia this year "nobody is forecasting recession". Australia's economic authorities have considerable policy firepower remaining to prevent that happening, he says. But with Treasury and the Reserve Bank recently conceding that Australia's trend rate of growth is nearer 2.75 per cent than 3.25 per cent, that means taxpayers' incomes and the country's tax base will grow much slower than our governments have become used to, and this could hamper economic growth. "Income weakness brings a focus on cost containment. Households defer spending and focus on balance sheet repair. Businesses defer capital spending and labour hiring. And governments facing growing budget deficits want to tighten the fiscal screws," the economic chapter warns. The report says the global economy is increasingly dependent on China to drive economic growth, so China's slowdown is central to global risks this year. And its role as a global driver of growth is starting to migrate over to global financial markets, so sharemarket turmoil in China will become more significant. "The fallout from the Chinese share market rout and Renminbi moves during the second half of 2015 and early 2016 are recent examples," the report says. "We should now watch Chinese financial markets very closely when assessing global financial market risks. The report Asia's rising middle-class provides unprecedented opportunities for Australia's non-resource sectors, and this ought to be a focus of our political and business leaders. "A focus on recognising opportunities such as increasing demand for education, tourism and health services from Asia and on growth enhancing reforms such as real tax reform will be vital in 2016," Professor Martin said. Read more: http://www.smh.com.au/federal-politics/political-news/australias-economy-facing-hazards-unlike-any-see-in-20-years-ceda-20160217-gmwf6i.html#ixzz40X8qwfi6 Link to comment Share on other sites More sharing options...
flybyknight Posted February 18, 2016 Share Posted February 18, 2016 also the media seem to be loving the $10 cheaper a tank petrol thing, and tbh most of us are too...... however most of us lost between $1500 and $6000 on our super and pensions last year alone and this year looks likely to be the same, simply because they are heavily invested in the mines and petrochemicals. keep an eye on your pensions! Do you bet on this dip being a cyclic thing or an energy revolution? research if need be, then put your money straight, shame to lose a pension for nostalgia or indeed an ideology. Link to comment Share on other sites More sharing options...
amibovered Posted February 18, 2016 Share Posted February 18, 2016 Blimey PQ you're full of the joys today :elvis: Link to comment Share on other sites More sharing options...
newjez Posted February 18, 2016 Share Posted February 18, 2016 To be honest, I'm surprised it's not toast already. Brazil, Canada, south Africa all seem to be suffering. Link to comment Share on other sites More sharing options...
Parley Posted February 18, 2016 Share Posted February 18, 2016 Australia's economy is actually doing pretty well. Extremely resilient in fact. Link to comment Share on other sites More sharing options...
Parley Posted March 2, 2016 Share Posted March 2, 2016 Latest Australian Economic results out today for December qtr. Extremely good results. GDP growth of 3%. Better than Most countries. Link to comment Share on other sites More sharing options...
Guest Posted March 2, 2016 Share Posted March 2, 2016 Captain Doom and Gloom taken day off? Link to comment Share on other sites More sharing options...
Guest Posted March 2, 2016 Share Posted March 2, 2016 Apparently huge jump in tourism since devalued dollar. Though we all know that doesn't count... Link to comment Share on other sites More sharing options...
newjez Posted March 2, 2016 Share Posted March 2, 2016 Maybe not quite as good as the numbers suggest, but better than expected. http://www.businessinsider.com.au/australia-gdp-q4-2015-economic-growth-2016-3 Link to comment Share on other sites More sharing options...
northshorepom Posted March 2, 2016 Share Posted March 2, 2016 I'm not knocking 3% growth, but it looks less clever when it's set against an annual population increase of 2%. Real growth (in terms of GDP per capita) is therefore much lower than that headline figure On a selfish level, we are OK in Sydney and my personal industry (infrastructure) is heading into a substantial boom. I see plenty of resilience in Australia's service economy (think we could do much more with some appropriate policy making though), manufacturing less so. Productivity is stubbornly too low. Resources sector is always up and down, it's totally driven by commodity price which are volatile and uncontrollable. Link to comment Share on other sites More sharing options...
Parley Posted March 3, 2016 Share Posted March 3, 2016 Better than any G7 country. Link to comment Share on other sites More sharing options...
Guest Posted March 3, 2016 Share Posted March 3, 2016 Share portfolio gone gang busters last month with big dividend yields to boot... I tried to help flag of doom and gloom Link to comment Share on other sites More sharing options...
Parley Posted March 3, 2016 Share Posted March 3, 2016 As long as you bought while they are low yes a good yield and hopefully good capital gain too. The superannuation has taken a hit though this year. Link to comment Share on other sites More sharing options...
Guest Posted March 3, 2016 Share Posted March 3, 2016 As long as you bought while they are low yes a good yield and hopefully good capital gain too. The superannuation has taken a hit though this year. Been buying heavily since July when the sky was supposedly falling. Going to sell up a few because while buying chiefly for dividends the capital gains have been so good. Will wait to buy back in. Even made 25% in Harvey Norman in under 6 months. Super not such a big concern in early 30s. Link to comment Share on other sites More sharing options...
northshorepom Posted March 3, 2016 Share Posted March 3, 2016 Better than any G7 country. Not in GDP per capita terms https://stats.oecd.org/Index.aspx?DataSetCode=PDB_GR Yes, it does matter. This is a real measure of wealth/standard of living with the effect due to population growth stripped out Link to comment Share on other sites More sharing options...
newjez Posted March 3, 2016 Share Posted March 3, 2016 Not in GDP per capita terms https://stats.oecd.org/Index.aspx?DataSetCode=PDB_GR Yes, it does matter. This is a real measure of wealth/standard of living with the effect due to population growth stripped out I am surprised that Australia is doing so well while the likes of Brazil, Canada, Russia, south Africa, even NZ have taken a knock. I know you can't do direct comparison, but a little voice in my head says be cautious. Likewise I am also enjoying the stock rises, but I still hold a fair bit of cash. Link to comment Share on other sites More sharing options...
Guest Posted March 7, 2016 Share Posted March 7, 2016 20 Percent rise in Iron Ore overnight... Link to comment Share on other sites More sharing options...
Parley Posted March 7, 2016 Share Posted March 7, 2016 And oil is on the way up too. The question is, Is it sustainable or a bear market trap ? Link to comment Share on other sites More sharing options...
flag of convenience Posted March 8, 2016 Share Posted March 8, 2016 Share portfolio gone gang busters last month with big dividend yields to boot... I tried to help flag of doom and gloom Are you really as clueless as you sound to matters economic? Don't fret though a few on this forum are as equally naïve. Link to comment Share on other sites More sharing options...
flag of convenience Posted March 8, 2016 Share Posted March 8, 2016 20 Percent rise in Iron Ore overnight... Dead cat bouncing I suspect. Link to comment Share on other sites More sharing options...
flag of convenience Posted March 8, 2016 Share Posted March 8, 2016 I am surprised that Australia is doing so well while the likes of Brazil, Canada, Russia, south Africa, even NZ have taken a knock. I know you can't do direct comparison, but a little voice in my head says be cautious. Likewise I am also enjoying the stock rises, but I still hold a fair bit of cash. Me to cash is king in crisis. As for the economy, we can always flip two million dollar houses to one another I suspect. In such an economy the economic rational becomes senseless not to say meaningless. What could go wrong? Link to comment Share on other sites More sharing options...
flag of convenience Posted March 8, 2016 Share Posted March 8, 2016 Share portfolio gone gang busters last month with big dividend yields to boot... I tried to help flag of doom and gloom A new discovery to the road to riches. Who'd have guessed it the share market. I'd keep it close to my chest if I were you. Link to comment Share on other sites More sharing options...
Guest Posted March 8, 2016 Share Posted March 8, 2016 Are you really as clueless as you sound to matters economic? Don't fret though a few on this forum are as equally naïve. Still waiting for the 30 % house price correction you have guaranteed in the cities... I've studied economics at masters level, your understanding appears to be from headlines which you pick up from the doom and gloom times. My share portfolio now up 20% this financial year...want any tips?.. Link to comment Share on other sites More sharing options...
newjez Posted March 8, 2016 Share Posted March 8, 2016 Me to cash is king in crisis. As for the economy, we can always flip two million dollar houses to one another I suspect. In such an economy the economic rational becomes senseless not to say meaningless. What could go wrong? Where to from here? My heart says buy, the bad news is over. My head says sell, the bad is hiding round the corner. I really didn't expect the market to jump like that. I only bought as I thought we had hit bottom. I didn't figure we'd rise this sharply for years. Now we have, what to do? Link to comment Share on other sites More sharing options...
Keith and Linda Posted March 8, 2016 Share Posted March 8, 2016 Where to from here? My heart says buy, the bad news is over. My head says sell, the bad is hiding round the corner. I really didn't expect the market to jump like that. I only bought as I thought we had hit bottom. I didn't figure we'd rise this sharply for years. Now we have, what to do? And that is and will always be the dilemma. we can only make the call when we are ready to do so and be satisfied with that call whatever the outcome but eggs and basket come to mind too! Link to comment Share on other sites More sharing options...
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