Fleaflyfloflum

And where in my post did i say, you said, we wouldnt survive?

And dont call me names please.

Budawang

With all due respect Cricket1, I think you'll find that the ruthlessness, greed and corruption was a lot more prevalent in London and New York. Probably the main reason Australia is faring better is that financial prudential regulation has been much tighter here. In the short-term, tightly regulated financial markets offer fewer possibilities for financial institutions to develop "exotic financial instruments" and associated pyramid schemes, shonky dealings, insider trading, mega bonuses and assorted scams. However, when the music stops, the pyramid scheme that is The City and Wall Street starts to collapse.

jackuk

All is going to be ok....Gordons plan is that we are going to spend. spend , spend are way out of this......I am not so sure....but the wife is really keen on the idea

neill

Only thing is, in the Post WWII, UK was bailed out by its ally, the USA. The USA is in no position financially (or political will - cold war) to even want to bail the UK this time around.

What the UK needs is to go back to good old-fashioned manufacturing, throw out all the Eco-mentalists who are also complicit in killing the UK's ability to make 'stuff' for itself.

Other countries can profit from having a weak currency; The UK can't even do that because nothing is made there anymore!!!

dunroving

I watched an interesting documentary about a year back, hosted by Peter and Dan Snow, on what people earn. It was interesting in many ways - the obvious, like realising how little some very hardworking people earn, and watching Dan Snow try one job in each salary category (including farm labourer and working in a morgue), and discovering how low the 95th %ile is (about 50k - I would have guessed in the triple figures, easily).

Perhaps the scariest part, though, is when they compared how many jobs were in the various employment sectors (agriculture, manufacturing, service sector, finance, etc.) today, compared to the past. The number of people employed in agriculture and manufacturing has drastically reduced while the number in the service sector (and whatever you call "civil servants" these days) has increased markedly, Perhaps the scariest though was the number of people working in finance and the extent to which our economy is run on providing financial services to the rest of the world. Now I'm no econ wizard but my guess is our reputation in the world's financial markets is probably not too good right now ... and the implications aren't worth thinking about.

Giantaxe

I'll be pretty surprised if Australia isn't hit hard by all of this mess. The only thing keeping Australia's head above waters is its natural resources and the demand for those resources from, primarily, China. If China's growth hits the buffers (and I read a scary commentary this past week that its export growth has gone from 25% to essentially 0% or slightly negative) then Australia will feel the impact.

As for having kept clear of the financial shenanigans, that's also true of Germany. Yet its economy is now also in a serious recession due to the impact on its export markets of the slowdown elsewhere.

I do agree that the UK will be worse hit though, perhaps even worse than the US. Its house prices are still further out of whack with historic norms versus income than almost anywhere else, and its per-head consumer debt in relation to income is astounding- far higher than even the US.

elfman

If we're referring to the legendary "let's be having you" outburst (I can't see youtube here at work) I think she's learned her lesson - that was nearly four years ago and she's kept her head down a bit since.

Bevm

Not saying you're wrong, but scattered populations bring problems of their own unless a lot of people can live off the land. Plus, what's the ratio of population to land that is both habitable without a lot of energy to heat or cool and also able to provide a decent range of food? Britain probably can't feed its population, but Canada might have trouble if oil is in short supply and/or expensive. Remember the climate. Winter in most parts of Canada is both non-productive and demands a lot of fuel. Don't know about Australia.

Most employment in Canada is based on consumerism, especially US consumerism, and the US is going to be consuming a lot less of non-essentials.

Are most jobs in Australia actually producing things -- food, steel, oil and essential items -- or are they service jobs, especially non-essential ones? Where are Australia's main export markets, and how are they doing? What essentials does Australia have to import, or is it self sufficient. We won't talk about water.

I'm not sure where the best place to be is, or when. Just asking questions.

Bev

Bevm

Just clarifying. By that you mean 95% of the working population earn 50,000 pounds or less? That's about $100,000 so it's hardly poverty line. You would have thought almost all the UK population would have been earning over 100,000 pounds? I'm missing something.

Mind you, I would have guessed that more than 5% were earning over 50,000 pounds. I'd probably have guessed around 25%

Interesting.

Bev

dunroving

Yes, that's correct. Although 50,000 pounds is not poverty line I'd have thought you would need to earn a lot more than that to be in the "top 5% of earners" (among professionals, I'd have thought 50k isn't especially high).

Cape Blue

I think you are correct and the Aus economy is about to struggle - its bulk commodities (like iron ore) are required by China both for domestic consumption but also to produce the goods that the US and EU buy - now they are not buying, China is not making and Aus will not be exporting.

Bulk commodities like iron ore, copper, aluminum etc have dropped to 20-30% of their value of only 4 months ago, so demand has obviously crashed, the mining companies will reduce production and there will be sector unemployment and reduced tax-take for the government.

Most of Australia's growth over the past 10 years has been in minerals/mining and around 60% of its exports are mining or agricultural.

On the property side, I seem to remember that the Economist property bubble index thingy had Aus right up there with the UK, Ireland and Spain and hugely in a bubble, so I suspect it will have similar problems to the UK in this issue as well.

Budawang

Yes, the Australian economy is/will be hit hard by the world financial and economic crisis. Commodity prices have slumped, the ASX is down 45%, private debt levels are high and government revenue is drying up. On the plus side, unemployment has only just begun creeping up and is still very low, the financial system is still functioning quite well (our big four banks are all in the world's top 20 lowest-risk banks due to good financial regulation) and consumer confidence has risen recently.

I think Australia will probably experience a mild recession, but probably won't be hit nearly as hard as the UK, Western Europe and the US. The government has more weapons at its disposal than its northern hemisphere counterparts for tackling the crisis: interest rates can fall further (and official rate cuts are mostly being passed on to the consumer) because they were higher before the crisis, the level of the Australian dollar more accurately reflects market fundamentals (a low dollar is a good thing right now) and, of course, there was a strong budget surplus going into the crisis. Furthermore, cashed-up countries like China are going to ramp up infrastructure investment to counteract the downturn and this will generate some demand for commodities.

On the other hand, the outlook for the UK and U.S. economies is very bleak. It's hard to see any positives right now.

Cape Blue

As on my previous post, Aus' large percentage of primary commodities export could be hit quite hard by the economic woes in the US and EU that hit China's export markets for manufactured goods. It is possible that the domestic building stimulus that many countries are consider (roads, bridges etc), might help prop the commodity flows somewhat.

As a percentage of the economy, Aus' manufacturing sector is smaller than the UK's.

cricket1again

I think the UK press will crush all hope of any kind of recovery, which causes my dilemma bout moving back there too soon.

I take my hat off to the Australians and their attitude. They are a resilient bunch. Shaped by their harsh climate and lack of sentimentality, they are both realistic and optimistic. The way they broadcast news is the same. You feel cautiously hopeful not devastatingly crushed.

Of course, Australia won't be exempt from feeling the effects of the crunch but because they are already in a position of strength by not having the burden of a national debt, they can afford to weather the storm much better than the US and the UK. They produce most of their own food and many other products and even though mining jobs are being lost, those jobs were given to imported workers who would have probably had the philosophy to make the most of the boom in the mining industry.

There are huge opportunities surfacing as exports from China become increasingly expensive. I own a clothing company where we design and produce our own label (currently based in Australia). I know the costs involved and have long seen how greed would eventually have it's own impact. We can design, produce and retail a product for the same price as goods that are made in China. We take a slightly lower profit but we are in control of the whole production and quality of our label.
Yet, I have seen shoes and handbags bought at the wholesale cost out of China for $2.00 (from an Australian importer) then sold in high end boutiques for $99.00 so they have set their market and rented premises thinking they were in clover. The greed factor now means that many businesses will go under because they have relied solely on China whereas we should excel because we are producing a home grown product where our overheads are low, our product in demand and our production controlled by us, not external influences. Already, we have created jobs and business opportunities both here in Australia and in the UK.
I am looking forward to positive growth next year.

As fas as property goes, I live on the Gold Coast and while property prices have dipped slightly, demand is still up in the sense that buyers may have chosen to buy a $400,000 home instead of a $500,000 home. But houses are selling and investors are sat waiting like vultures waiting to pounce on a good buy after the next interest rate cut. OK, some of the higher priced properties aren't budging and some people have been forced to sell at a loss because they've over committed. But those who don't need to sell are refusing to drop their prices. In my area, my house has gone up this year by 6% but then moving to the Gold Coast is a very popular lifestyle choice. I think approx 1,000 people a month are still moving to Queensland.
It's different for the UK, people don't generally move there for the lifestyle, the reasons are usually economic and in fact, this year, the country has seen a record number of Brits leave.
The only problem I have isn't so much about where to live as the best place from which to successfully grow my business.

Budawang

Cricket1, I take my hat off to anyone who has not only set up a business but actually manufactures in this country and can compete with China. Very impressive. I certainly hope you can be convinced to stay in this country as entrepreneurial talent like yours is a rare commodity.

I understand your point about lazy businesses which make huge profit margins from imported product. Unfortunately, I find Australian consumers are not very savvy or demanding and don't shop around much. However, I think this is changing with more people willing to look online.