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Australian Economy: Do you think the government now has its head out of the sand?

Australian Economy: Do you think the government now has its head out of the sand?

Old Jan 14th 2009, 5:47 am
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Default Australian Economy: Do you think the government now has its head out of the sand?

Just thinking about what's been happening over the last year, all the denials, all the, we'll be alright, China will carry us through etc etc

Do you think they've finally realised that the turds are really slamming into the fan now?
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Old Jan 14th 2009, 5:55 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

I think a lot of heads are now popping up out of the sand. It's been a long time now since I've heard a 'China will save the day story'.

However I don't think you can say that what is happening now was obviously predictable, even just a couple of months ago. The speed and severity with which things seem to have deteriorated, even if they were already predicted to be bad seems to be taking most people by surprise (not just in Aus).
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Old Jan 14th 2009, 5:58 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by NKSK version 2 View Post
Just thinking about what's been happening over the last year, all the denials, all the, we'll be alright, China will carry us through etc etc

Do you think they've finally realised that the turds are really slamming into the fan now?
You mean the recession is in fact global after all?
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Old Jan 14th 2009, 6:11 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

World leaders need to get their heads together over this one. I am just surprised it took so long to happen.
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Old Jan 14th 2009, 6:36 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by bcworld View Post

However I don't think you can say that what is happening now was obviously predictable, even just a couple of months ago. The speed and severity with which things seem to have deteriorated, even if they were already predicted to be bad seems to be taking most people by surprise (not just in Aus).
Hmmm. I disagree.
I'm no economist and I certainly have no talent for market spotting but when I saw a massive US slowdown for most of 2008 and mining stocks - Australia's key drivers of growth - plunging from $156 to $36 from May onwards - the writing was on the wall. The markets knew something was up and the government here was in denial.

http://britishexpats.com/forum/showt...26#post6837626
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Old Jan 14th 2009, 6:43 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

It's not going to be anywhere near as bad in Aus is it will be in the UK after 10 years of Brown's "Miracle Economy".

We'll have it easy here compared to the folks back in the UK.
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Old Jan 14th 2009, 6:50 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by NKSK version 2 View Post
Hmmm. I disagree.
I'm no economist and I certainly have no talent for market spotting but when I saw a massive US slowdown for most of 2008 and mining stocks - Australia's key drivers of growth - plunging from $156 to $36 from May onwards - the writing was on the wall. The markets knew something was up and the government here was in denial.

http://britishexpats.com/forum/showt...26#post6837626
I agree with what you're saying....but I just think the data has turned a lot worse in the last couple of months, and as it has, the optimists are in increasingly short supply.

Surely, even if Aus as whole doesn't WA must enter a technical recession....I can't imagine how its GDP can match its 2008 highs now that the bubble has burst.
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Old Jan 14th 2009, 7:11 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

One of the main that supports the economy is consumer confidence (and hence consumer spending). That is what makes goods bought, goods made and people employed.

While some may think it "head in the sand" or "denial" most governments very astutely will never talk down the economy; to do so is a self fulfilling prophecy.

Further, whether or not K Rudd can be be held "repsonsible" is another matter. Some would say that the Howard Government claiming ot be the party of lower interest rates and big tax cuts may just have led to non-sustainable spending and an over-inflated local economy.

Had Howard been returned perhaps it would be he stating that this "is the recession we had to have".
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Old Jan 14th 2009, 7:15 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by jayr View Post
One of the main that supports the economy is consumer confidence (and hence consumer spending). That is what makes goods bought, goods made and people employed.

While some may think it "head in the sand" or "denial" most governments very astutely will never talk down the economy; to do so is a self fulfilling prophecy.

Further, whether or not K Rudd can be be held "repsonsible" is another matter. Some would say that the Howard Government claiming ot be the party of lower interest rates and big tax cuts may just have led to non-sustainable spending and an over-inflated local economy.

Had Howard been returned perhaps it would be he stating that this "is the recession we had to have".
The one thing that may pull Aussie through, is the real and obvious housing shortage.... They really do have to build a lot of houses here in Melbourne at least. So keep those migrants rolling in.
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Old Jan 14th 2009, 7:20 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by ozzieeagle View Post
The one thing that may pull Aussie through, is the real and obvious housing shortage.... They really do have to build a lot of houses here in Melbourne at least. So keep those migrants rolling in.
Does this mean there are thousands living on the streets?
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Old Jan 14th 2009, 7:22 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by ozzieeagle View Post
The one thing that may pull Aussie through, is the real and obvious housing shortage.... They really do have to build a lot of houses here in Melbourne at least. So keep those migrants rolling in.
Everywhere I've heard of, the housing starts are dropping...

One thing I do think is a dead cert is that the middle and high end property prices here on the Northern Beaches will tank... and if there's a widespread return to sensible lending ratios then elsewhere too...
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Old Jan 14th 2009, 7:27 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by Exile View Post
Does this mean there are thousands living on the streets?
No, but there are plenty of newcomers that are sharing accomodation with family.

The big rush is for 2 bedroom unit type accomodation.

Rentals are still in very short supply at around 1.5 pct vacancy rates in inner Melbourne.


http://www.infolink.com.au/c/BIS-Shr...ecline-n770093

Everytime I see a flat go up for rent around here, there are still at least 30 people waiting to view it at inspection time.

Last edited by ozzieeagle; Jan 14th 2009 at 7:30 am.
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Old Jan 14th 2009, 7:35 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by ozzieeagle View Post
No, but there are plenty of newcomers that are sharing accomodation with family.

The big rush is for 2 bedroom unit type accomodation.

Rentals are still in very short supply at around 1.5 pct vacancy rates in inner Melbourne.


http://www.infolink.com.au/c/BIS-Shr...ecline-n770093

Everytime I see a flat go up for rent around here, there are still at least 30 people waiting to view it at inspection time.
I have problems with the logic of this.
Why aren't they buying? Presumably because prices are too high? Meaning that current prices are unsustainable? Meaning that when supply increases although this might be good for builders it will probably lead to a further drop in prices meaning a drop in household wealth?
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Old Jan 14th 2009, 7:40 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Originally Posted by NKSK version 2 View Post
I have problems with the logic of this.
Why aren't they buying? Presumably because prices are too high? Meaning that current prices are unsustainable? Meaning that when supply increases although this might be good for builders it will probably lead to a further drop in prices meaning a drop in household wealth?

Good old Supply and Demand should be the counter to that Argument. Send in more overseas Students to Study and obviously rent

However we do seem to be approaching unprecedented times.

When I stop seeing people queueing for inspection at rentals. Then I will really worry about the economy. The Asian renters apparently are still offering over the odds as soon as they front the Estate Agents.
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Old Jan 14th 2009, 7:56 am
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Default Re: Australian Economy: Do you think the government now has its head out of the sand?

Some of the hubris may be wearing off - but the old "she'll be right" isn't that easily dismissed!

I recommend that yo'all read "The lucky country" - written decades ago but as relevant now as it ever was. The main thrust was that Australia needed to lift its game more than a little and could not rely on being the Lucky Country ( ie warm, beachy and with raw materials just waiting to be sold to foreigners).

The irony was that the epithet became exactly the opposite in meaning to that intended, and Australians called Australia the Lucky Country as if it was meant to be that by God.

We shall see..............

Even if you accept that Rudd should have spent billions "Jump starting" an economy being eroded by debt, IMO it was ludicrous to just pile them into people's pockets to spend on plasmas etc. Putting billions into infrastructure would actually do some good, might save the Murray and even make Adelaide inhabitable in ten years' time!
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