My curiosity was stirred last week by M Jackson, who said that, (subject to approval) the Australian Securities and Investment Commission (ASIC) may allow you to have a punt on our property markets. Described as a world first, ASX punters can take out a derivative contract based on Rismark/RP Data market indices which are in turn quoted daily to the share market. I did laugh when I read ‘daily’ – try months after the event if real estate agents decide to block data sales access.

Back to M Jackson’s comment on last week’s blog – “Contrary to popular myth, the water in Australian plugholes goes down the same way as everywhere else. So, too, the housing market. Figures from the Bureau of Statistics (ABS) on Monday showed that prices in eight capital cities were down by a record 2.2 per cent between December and March. The fourth quarterly fall in a row brought the year – on – year rate of decline to almost 7 per cent.”

Rismark/RP Data reported national dwelling values increased by 1.52 per cent for March 2009. Then the ABS reports a 2.2 per cent decline. Somebody got it wrong – but hey, take a punt?

Tim Mooney Photography

www.timmooneyphotography.com

Back to M Jackson’s comment – “Gross rentals yields of about 3 per cent, meanwhile, are near all – time lows; if houses were stocks, they’d be trading on wobbly price/earnings multiples of more than 30 times. Unemployment data, to be released on Thursday, may show a rise to almost 6 per cent, the highest level in six years. Job ads fell again in April. Mortgage flows are sputtering. The props are falling away. Currently the SFE is constructing a tradeable index on Australian housing, which should be completed by and ready by August 2009. I can’t wait to go short. If there was one specific to the Lower North Shore in Sydney. I would have double the size positions.”

I thank M Jackson for his input and look forward to reading more responses to our blogs.

The Global Financial Crisis was brought about by global banking institutions investing in (probable and possible) markets based on high debt ratios – otherwise known as gambling. The process for aggregating property data has always been flawed – highlighted by the simple fact that the ABS and Rismark/RP Data constantly report conflicting property data positions. Definitely not an each – way bet!

Consider the property market reality, if ASIC approves the trade derivative contracts and the Australian real estate agencies automatically cease providing all sales data to all the aggregators? It would then be one, two, three, four, five and six months until such data became available. Just who would punt on such irregularities? The data aggregators don’t act in harmony with real estate agencies in Australia where there is not the slightest possibility of any change – anytime soon. I would predict (and support) a total real estate data black–out.

After all, we act for our vendors (first and foremost) and are under absolutely no obligation to report sales data that aggregator’s then on-sell to institutions. One only has to look at the banning of shorting banking stocks to observe that this is conducive to assisting economic growth in a recession. The real estate industry is the largest employer in Australia where our economy is only in a sound position because our banking system is world’s best practise and world’s best profits too.

Simply put: real estate agencies would cease reporting sales and rental data and agents would then lengthen the odds quite considerably. If such a market was created where (just say) you could bet on the Mosman market – I would hope that collectively, Mosman agencies would turn such a proposal into a blank canvas with data support.

From “bricks and mortar” to “punt and hunt” derivative markets! The only people that I can see making money from these proposed markets are actually the real estate agents. Is this Australia’s financial version of subprime – a buy position without actually owning a house? Short on being exact and very long on accuracy.

I thought Malcolm Turnbull’s Budget response to be lame (to say the least). However, with the possibility of a double dissolution around the corner, it makes sense to keep ones “powder dry”. As one subscriber said this week, “depending upon the government for your future financial security, is like hiring an accountant who is a compulsive gambler!”

Ruddy Fantastic and Wayne Swans’ missing word disorder’ may have been cured this week when it was revealed on www.smh.com.au “It’s been suggested that Kevin Rudd would not utter the phrase “$300 billion” for fears his words will be used in coalition advertisements during the next election campaign.” So much for “sticks and stones may break my bones but words will never hurt me.” Then “Mr Rudd said Australia’s debt would peak at “around 200, or gross debt at about 300” in 2013 – 14. Now journalists are on to this political spin game and will play this to their hearts’ content. Very petty, although Australia’s deficit needs much more than petty cash as we will continually be reminded for many years to come.

Australia’s housing prices are at their most affordable level in seven years and in the March quarter the Housing Industry Association – Commonwealth Bank First Home Buyer Affordability Index recorded a 14.6 per cent increase. The average home loan fell by 11 per cent from $2056 a month to $1831 last year.

Despite confidence levels still being down, car sales in April were up on the March figures. Just as interesting is that in Mosman on www.domain.com.au there are only 118 houses/semis (I removed double entries, apartments, and out of area listings from the listed 135) available for sale which is an all time low in available stock levels. This will only get tighter over winter given that purchasers are now engaging with vendors.

This week’s video is a brilliant story about the annual Balmoral Burn Race Day which happens next Sunday on May 31. The Balmoral Burn Sponsors’ Dinner takes place on Friday May 29, 2009 so watch the video for more details. Keeping in the theme, this week’s aerial photograph by Tim Mooney Photography, highlights the best beach on our planet and in the background Awaba Street – the Balmoral Burn tread mill. Congratulations to Phil and Julie Kearns who started this brilliant fundraising event back in 2001. Given that I have won the race three times now, I am no longer eligible to compete.

Cheers ^__^

For this week’s recorded Mosman real estate, Cremorne real estate, Neutral Bay real estate and Cammeray real estate sales http://www.rwm.com.au/news/

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22.05.09Robert Simeon8 Comments »

In years gone by, on Budget night the government (of the day) would broadcast in the first sentence the surplus (this last happened in 2008). This time around, there was absolutely no mention of the exact deficit figure which is quite unbelievable to say the least. Should one then assume that the hiding of the deficit beast within the Australian economy is part of the spin, better known today, as political whispering?

One can then assume that transparency is not exactly of paramount importance, given that the previous largest Budget deficit was $18 billion back in 1992 -93 and 1993 – 94. The Budget Speech 2009/10 took most by surprise as it was pure political spin, better known as being politically correct – a A$57.6 billion was obviously deemed “Not For Publication”.

A$57.6 billion Budget deficit is nothing more than a temporary phase that our economy currently is experiencing , so Wayne Swan keeps reminding us. This was brilliant sugar coating as the reality of a double dissolution election jumps to the fore, given that the Budget deficit will escalate alarmingly should Federal Labor serve a full term.

Piers Akerman wrote on his Daily Telegraph blog “Prime Minister Kevin Rudd and Treasurer Wayne Swan have lost a word. They can no longer bring themselves to utter “billion”. Asked yesterday on radio why he’d declined to mention the precise deficit amount in Tuesday’s Budget speech, Swan replied to a direct challenge with the answer “57”.Not 57 billion. Just 57. Then, in Question Time, Rudd responded to a similar challenge with his reply, “57.6.” Sounds like a clue to me.

I read with interest the Macquarie Research Economics Report – “It is important to note, however, that the vast majority of policy action was taken by the Government prior to the formation of the 2009-10 Budget. As a result, policy actions in this Budget appear to be more targeted towards achieving political objectives rather than undertaking any major spending reform.”

Prior to Budget night we heard a record twenty one Budget leaks. In the Budget speech there were ten references to the word recession and two to the words Great Depression. This was modern day political conditioning, where the implanted theme was to expect the worse and then be suitably impressed with the outcome … again – a brilliant spin.

No doubt Ruddy Fantastic was rejoicing when last week, when the Reserve Bank of Australia (RBA) announced that it believes the current recession will not be as severe as the recession of the early – 1990’s. What the RBA failed to identify was that back in the 1990’s the internet had not been invented.

Well that’s a relief, we are already noticing overdue confidence within the Mosman real estate market. We foresee a tight winter as the expected avalanche of distressed properties hitting our markets simply won’t happen. One does not have to be an economist to realise that if supply is constrained then demand increases. We anticipate very few new properties being offered to the market until September.

The waiting game, which is happening everywhere as Peter Costello wrote in the Sydney Morning Herald www.smh.com.au on April 29, 2009 “Buy now and pay much more later.” The member for Higgins wrote “I’ve often wondered about those advertisements that offer: “Buy now. No repayments for 24 months. You pay nothing until 2011.” Pre – empting the forthcoming Swan Budget Costello wrote “I wonder if people ask themselves whether it’s going to be easier to pay more, later than it is to pay less now? Or do they just take the benefit today and leave the worrying until tomorrow. “For mine, a smart analogy, given that Australians now have a A$57.6 billion Budget deficit and the interest meter is running.

Peter Costello went on to write – “And there’s no repayment? Actually, the Government borrowed this money, so it will have to pay interest to the lenders. And since it gets all its money from taxpayers, it’s the taxpayers who will foot the interest bill.” For those residing in Fort Crumble – in less than a month our NSW government will deliver its budget and it will get even uglier as it is in deficit, which equates to more increased taxes. This budget has the potential to be the hardest cash grab in history, which adds fuel to why Ruddy Fantastic sugar coated his Federal Fudge – it. Expect a shocker which is actually in line with the way Fort Crumble has administered NSW.

In summation Peter Costello wrote – “I recommend that families enjoy the Government’s “buy now, pay later” policy because a bill is coming. And it will be a big one. We don’t yet know how many years, or decades, of interest payments are in front of us.”

“Retailers would not get away with the kind of sales technique the Government has engaged in. Retailers have to detail the number of repayments, the interest rate and the all up cost before the sale. You get to choose whether to take the package. What’s more, if a retailer gives misleading information the interest payments are suspended. Try getting that from the Federal Government.”

This week’s brilliant aerial capture by Tim Mooney is of Balmoral Beach Club and its Nippers squad – points a poignant question, how old will these nippers be before they see a Federal budget in surplus?

Now for the steak knives … Mosman Council is installing parking meters along Balmoral Beach and other harbour side locations from July, 2009. Interesting debate brewing and here is a video of those against. Many of those whom appear are subscribers to Virtual Realty News.

Reece Coleman, Director – Real Estate Services at Fairfax Digital has responded to our queries about property data in last week’s edition. Here are Reece’s responses – http://www.rwm.com.au/2009/05/the-mumbo-jumbo-of-politics-and-property-data/

Editions of Virtual Realty News, thanks to Ruddy Fantastic have been extended another two years as a direct result of the retirement age extension. I’ll make a mental note to write an edition then, called , where are they now? Let’s hope it won’t be a case of still paying off Ruddy Fantastic’s temporary budget deficit.

We have expanded our RWM real estate media platform where aside from weekly, Tim Mooney photographic contributions we will also be adding weekly videos for your enjoyment of our weekly E-Zine. We are always re-shaping our online industry with new technology investments and setting new industry standards.

Next week – we assess Malcolm Turnbull’s Budget response and from what I observed he was smoking!

Cheers ^__^

For this week’s recorded Mosman real estate, Cremorne real estate, Neutral Bay real estate and Cammeray real estate sales http://www.rwm.com.au/news/

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15.05.09Robert Simeon16 Comments »

Compared to what I read last Friday night when I opened my daily www.crikey.com.au electronic magazine, the new economic war is all about fighting growing global unemployment. Spare a thought.

“WASHINGTON: A record 32.2 million people – one in every 10 Americans — received food stamps at the latest count, the government said on Thursday, and a reflection of the recession now in its 16th month. Food stamps, the major U.S. anti-hunger program, help poor people buy groceries. The average benefit was $112.82 per person in January. The January figure marks the third time in five months that enrolment set a record.” Source:Reuters

Two editions ago, I wrote “Living in the past and struggling with the future”. Our current recession is definitely not a case of better late than never – more a case of elected politicians who have stymied our very own economies through gross mismanagement of resources, education, health, transport, employment etc.”

Last Saturday’s edition of “The Weekend Australian Financial Review” a brilliant article was filed by Damon Kitney and Annabel Hepworth titled “The man who must stop the gravy train”.
Sydney’s northern suburbs boast some of the best beaches in the world. But try venturing across the Spit Bridge on a clear Sydney day at any time of year and half your day will probably be gone before you arrive on the sand.

It’s the same at morning and evening peak hour, when the narrow four-lane bridge separating Mosman and the northern beaches regularly resembles a parking lot.

Yet when one building industry executive inquired last year of a current minister in the Rees Labor government about the chronic lack of infrastructure through the region all the way up to Palm Beach, the reply was simple: F—k ‘em, they get nothing up there, just f—k ‘em.” the minister reportedly said. These are the bad old days of NSW Labor.”

Enter Ruddy Fantastic’s Infrastructure Australia and not before time.

So the formula applied to NSW tax payers (Stamp Duty, Land Tax, Payroll Tax and GST allocation) doesn’t discriminate yet the allocation of infrastructure spending does? This simply explains why infrastructure in NSW is in a ‘state’ of chaos.

I am a strong supporter of Ruddy Fantastic’s Infrastructure Australia and a fan of appointed chairman Rod Eddington. With state and territory governments now (collectively) in budget deficit, the power of infrastructure spending has been removed from the states and territories to the new (independent) governing power – Infrastructure Australia.

With the federal government also staring down at a budget deficit, it too will have to find a way to climb back into budget surplus. In my humble opinion, the Global Financial Crisis will prove that Australia no longer requires state and territory governments and a smart vehicle like Infrastructure Australia, spells the demise of middle government and not before time.

The corruption and waste of taxpayer revenues is well documented where more than a penny drops into the federal government’s coffers. Infrastructure Australia will in all probability be Rudd’s check (cheque) – mate for turning a budget deficit around. GST has failed miserably and taxes went up (as against the promise of coming down) – so time to bring infrastructure and taxation under the one umbrella. If it comes off (and only incompetence would stop this coming to fruition) – a brilliant political power play.

The federal government urgently needs to beef – up the Australian economy. Now the independently operated Infrastructure Australia will be adding the much needed gravy to the beef.

So let’s look at the upward movement of Mosman house prices from 2000 to 2008 a tale of position, power, glory and not necessarily a bad story. Today, you hold not fold – major banks don’t have non-performing loans on their respective radars as against previous banking mandates of past recessions. Simply put: markets recover and the Mosman property currency remains one of the strongest in Australia as I will identify in coming editions.

Here is a quick brain teaser. How many $10,000,000 plus Mosman house sales were recorded from 2000 to 2008? Have a think and I will get to the answer later on.

MOSMAN HOUSE SALES FROM 2000 – 2008 IN EXCESS OF $5,000,000

2000

• Total Sales – 4
• Total Value – $22,500,000
• Average Sale Price – $5,637,500
• Lowest Sale Price – $5,150,000
• Highest Sale Price – $5,900,000
  

  2001

• Total Sales – 12
• Total Value – $77,385,000
• Average Sale Price – $6,448,750
• Lowest Sale Price – $5,400,000
• Highest Sale Price – $15.500,000 (Mosman’s first $10,000,000+ sale)
  

  2002

• Total Sales – 9
• Total Value – $54,650,000
• Average Sale Price – $6,072,222
• Lowest Sale Price – $5,400,000
• Highest Sale Price – $9,400,000
  

  2003

• Total Sales – 19
• Total Value – $120,518,250
• Average Sale Price – $6,343,065
• Lowest Sale Price – $5,000,000
• Highest Sale Price – $11,000,000
  

  2004

• Total Sales – 16
• Total Value – $112,151,000
• Average Sale Price – $7,009,437
• Lowest Sale Price – $5,000,000
• Highest Sale Price – $11,000,000
  

  2005

• Total sales – 16
• Total Value – $137,720,000
• Average Sale Price – $8,607,500
• Lowest Sale Price – $5,100,000
• Highest Sale Price – $14,800,000
  

  2006

• Total Sales – 31
• Total Value – $231,285,000
• Average Sale Price – $7,460,806
• Lowest Sale Price – $5,000,000
• Highest Sale Price – $15,000,000
  

  2007

• Total Sales – 44
• Total Value – $349,650,000
• Average Sales Price – $7,946,590
• Lowest Sale Price – $5,050,000
• Highest Sale Price – $22,500,000 (new Mosman record)
  

  2008 – Enter Global Financial Crisis

• Total Sales – 25
• Total Value – $170,050,000
• Average Sale Price – $6,802,000
• Lowest Sale Price – $5,000,000
• Highest Sale Price – $14,700,000

  Source: Australian Property Monitors

  There have actually been 30 recorded sales in excess of $10,000,000 from 2000 – 2008. The agents I spoke with guessed between 12 and 18 sales – I will reveal more data in next week’s edition which will identify the excellent opportunities on offer in this price demographic.

  This week, The Reserve Bank of Australia (RBA) cut interest rates by 0.25 per cent which now takes the cash rate (3.00 per cent) to the lowest level in forty nine years. An anti – climax because the major banks decided to either not pass on and/or minimise reductions to borrowers. With the benefit of hindsight the RBA would acknowledge that the latest rate reduction amounts to very little.

  Makes one wonder exactly who is running our country – the banks or the federal government?

  Obviously the bank deposit guarantee and the ban on short selling financials means next to nothing to them. How would they react if they were lifted? The federal government came to the party and now the banks must dance to that tune – or else.

  Better still why are the major banks charging credit cards at 600 per cent over the present cash rate of 3.00 per cent? Credit card debt should be a government priority in a recession that forces the banks to tow the line with credit card interest rates. Such a move would assist struggling families – and identify that they (banks) are no longer a law unto themselves. Messrs Kevin Rudd, Wayne Swan and Lindsay Tanner, need to decisively act and Messrs Malcolm Turnbull and Joe Hockey need to keep them honest.

  Our blog awaits your thoughtful insights.

  Have a fantastic and safe Easter.

  Cheers with chocolate on top ^__^

  For this week’s recorded Mosman real estate, Cremorne real estate, Neutral Bay real estate and Cammeray real estate sales http://www.rwm.com.au/news/

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  9.04.09Robert Simeon3 Comments »

The latter part of the 2008 real estate market was stymied with speculation that in 2009, it would resemble a blood bath. For obvious reasons there was limited engagement resulting in record low transactions for the calendar year, with many suggesting that this was a clear case of ‘the calm before the storm’.

Already in 2009 we have seen that the property market bears absolutely no resemblance to the one that was predicted in 2008. The general consensus is that prices have been adjusted down and these adjustments vary from ten to twenty per cent. Anecdotal sales evidence suggests that the longer the time on the market, the greater the price adjustment.

My simple daily test for the Mosman real estate market is to monitor the number of houses currently available on www.domain.com.au This applies to all suburbs for that matter. At the end of 2008, listings for Mosman houses were nudging 200 on the Domain property portal. Today, (when one deducts the properties with multiple entries and wrong demographics) the number is just over 145.

To put this into greater perspective, in 2008 it was suggested that we could expect as many as thirty per cent of Mosman’s (approximately 4,900) houses to be on the market where we would see mortgagee-in- possession carnage. The reality is that currently, the Mosman house market is offering just over two per cent – a far cry from vocal predictions of thirty (plus) per cent.

Not to forget Mosman apartments. This is a very strong market where the Queen of Mosman apartment sales (our very own Marize Bellomo) notched up five sales this week.

We are now starting to see this resonate through the property market transactions that continue to build momentum. It has taken the purchasers just two months to get a clearer positioning of real estate markets. We are not attempting to talk our property market up – rather, to share the detailed research that we engage in that differentiates our agency’s obvious point of difference over our competitors. We prefer to offer anecdotal evidence from our research, not speculative, ill-informed rants.

It is not just in real estate that this exists as Alan Kohler wrote on his www.businessspectator.com.au “Wrong Diagnosis” about the demise of Pacific Brands. “Pacific Brands immediate problem is debt, not sales and margin.” This problem is exactly the same in real estate where high debt ratios can also have devastating effects – which is exactly what we are seeing globally. Closer to home, in 2008 we saw the Sydney South – West property markets in a free fall as a direct result of high debt ratios. These markets today are in recovery mode. I did enjoy this comment by Alan Kohler in his article. “Our political leaders, when they can spare a moment from slogging each other off and engaging in the most pathetic spin, and to the extent that they are doing anything useful at all, are focusing on the symptom not the cause – on consumer spending and employment, not credit creation.”

Our brilliant Treasurer, Wayne Swan, was boasting that his December “cash splash” was spent by many, buying “jocks and socks”. Makes one wonder what Pacific Brands think of his statement (a Bonding moment)? The theatre coming out of Canberra is nothing more than a very ordinary act. With each day, the unemployment rate escalates and I am confident that the unemployment explosion would settle down if Pay Roll Tax was abolished to enable businesses to preserve jobs. Pay Roll Tax is easily the most heinous tax and it is just a shame that Wayne Swan fails to understand this simple fact – the $14 billion a year Australian business tax that State governments charge businesses in return for employing staff. Australian businesses continue to proceed with caution although no politicians (Kevin Rudd, Malcolm Turnbull or Joe Hockey) have questioned why Australia’s official interest rate has fallen from 7.25 per cent to 3.25 per cent, yet business lending rates remain closer to the 7 per cent rate. Yes – businesses that employ Australians!!

So what is it that Kevin Rudd and Wayne Swan do *not* understand? Already the theatre is calling for a Theresa Rudd encore, given that she has successfully run an Australian business.

Australia is in a fortunate position where our banks are so strong that Boston Consulting announced this week, that Westpac was the world’s most profitable bank.

A shame that Kevin Rudd and Wayne Swan keep telling Australian businesses to mind their own business which explains why unemployment will continue to rise. As Alan Kohler suggested, ‘focus on the symptom not the cause’.

Our politicians on all sides are best summed up as Dumber versus Dumber. The Rudd/Swan “cash splashes” were all about buying votes, not about shoring up businesses. I call it Incompetent Diagnosis!

Cheers ^__^

This week’s Mosman real estate sales, Cremorne real estate sales, Cremorne Point real estate sales, Neutral Bay real estate sales – http://www.rwm.com.au/news/

Oh and Mosman also posted an $8.000 million + house sale this week 

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27.02.09Robert Simeon2 Comments »

Kevin Rudd has the naming rights for Politics Parade where what remains to be seen is whether or not his stimulus package becomes a revolutionary highway or a dead-end? Credentials for his curriculum vitae have recently changed from ‘economic conservative’ (Kevin 07) to his latest self proclaimed identity of (wait for it) Australia’s leader of “social democracy”. Talk about a fair weather sailor – he linked the Liberal Party to the neo – liberalism that brought about the global financial disaster and yet on the other hand we hear that Australia is best placed to ride out the financial crisis.

As quick as a flash the Howard (neo –liberalism) financial pantry has been emptied and the heat in the kitchen is hotter and hotter. It has now been revealed that December economic growth contracted by 1.2 per cent (according to the Westpac/Melbourne Institute). These figures indicate that Australia too is at recession growth levels.

Wayne Swan (arguably Australia’s greatest ever Treasurer) wrote his blog in The Daily Telegraph yesterday “that’s why the Rudd Government has acted so decisively to support jobs and growth, and cushion Australia from the worst impacts of the global recession. Yesterday retail sales figures showed our Economic Security Strategy really helped to support the retail sector at the end of last year, at a time when retail was in plummeting in other countries.” Nomura economist Stephen Roberts said it was quite a soft result considering the amount of stimulus injected into the economy.

I have long argued that if Payroll Tax was abolished, job security would be strengthened so it came as little surprise when the Australian Chamber of Commerce and Industry (ACCI) took this tax to task this week. ACCI chief said “past recessions tell us that once unemployment goes up, it does not come back to pre-recession levels. Society pays an ongoing price.” We are a small business and are fined well over $100,000 each year simply for employing staff. No doubt Australia’s greatest ever Treasurer missed Payroll Tax in his “Nation Building and Jobs Plan” stimulus package – but there again he has never employed anyone. Payroll Tax delivers state and territory governments approximately $14 billion so how many jobs would $14 billion buy? Guess who doesn’t get it? That would be Fort Fumble (Federal government).

Would you be surprised to learn that Kevin Rudd secretly agreed to let his fellow state Labor counterparts off the hook over $3 billion a year in state taxes by secretly dropping their agreement for receiving GST? The new agreement allows states and territories to keep levying stamp duties on business real estate deals. Peter Costello said that the new deal was actually a Rudd Government tax increase. “Businesses will be paying twice and therefore the public will be paying for the higher taxes.” Do you call that responsible government?

Our rental crisis continues and will only get worse with the global recession and last month recorded the highest increase since 1988. The latest figures from the Australian Bureau of Statistics show that the annual rate of growth across Australia surged 8.4 per cent. So in comes Fort Crumble (State government) where investors are now finding that their tax has jumped as a result of the new premium rate. Bear in mind if you own multiple properties the threshold can only be applied to one property and now should your individual/combined value exceed $2,250,000, your rate (fine) goes from 1.6 per cent to 2.00 per cent in 2009. This explains why rents keep escalating as investors are taxed out of the equation. Guess who doesn’t get it? That would be Fort Crumble!

They do however get some things at Fort Crumble and former union boss John Robertson, now Prisons Minister, awaits his $500,000 (tax payer funded) office fit – out. No doubt in his newly created position of Special Minister of State he can justify such expenditure. After all, our economy is booming and Fort Crumble has a massive budget surplus! The fact that it is stone motherless broke should not be construed as ‘reason for concern’.

Rest easy – Fort Fumble has ruled out tax increases with Australia’s greatest Finance Minister, Lindsay Tanner, assuring constituents that tax revenues will rise again automatically as growth returns. “Without having to change any tax rates they will rise again automatically.” Brilliant – just brilliant and thanks Lindsay for sharing Fort Fumble’s answer to its budget deficit recovery package. Pure genius!

Australia’s greatest ever Prime Minister Kevin Rudd won’t rule out a very early election and Anna Bligh who has to call an election before September 2009 had a bummer of a day when Chris Bombalas dropped a bomb – he won’t contest the next election! The “bomber” now joins eight other pollies who have left the Queensland Labor decks of the “Titanic”’.

Australia’s greatest ever “social democrat” Kevin Rudd would be concerned that Queensland and NSW Labor need more than botox to win the next elections. The Australian National University released its discussion paper “Are State Elections Affected by the National Economy? Evidence from Australia”. The discussion paper was written by Andrew Leigh and Mark McLeish.

They used data from 191 state elections. These are amazing statistics:-

“In the early – 1990’s, the Australian economy entered its deepest downturn in the post war era, with the national unemployment rate reaching nearly 12 per cent in early – 1993.

• During the period 1992 – 1995, six of Australia’s eight states and territories ousted their government.

• By contrast, the mid – 2000s saw the Australian economy enjoying strong growth and falling unemployment.

• During 2003 – 2006, Australia’s unemployment rate averaged 5 per cent. In these years, no state or territory government was ousted from power.

• Were the state leaders who lost office in the early 1990’s unfairly punished for the state of the national economy?

• And were some of those who kept office in the mid – 2000’s unfairly rewarded?

No wonder Australia’s greatest ever Prime Minister and Treasurer are fast tracking an early election.

Or maybe I spend too much time reading reports? No wonder Peter Costello is sitting tight and Malcolm Turnbull is struggling in Politics Parade.

I bet you get it!

Cheers ^__^

This week’s Mosman real estate, Cremorne real estate and Neutral Bay real estate sales

http://www.rwm.com.au/news/

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20.02.09Robert SimeonNo Comments »

Like teenagers who just received their first credit cards, Kevin Rudd and Wayne Swan have collectively joined Australian state and territory governments with a deficit budget (once approved in the Senate). To put this into greater perspective, the NSW government (Fort Crumble) has been broke for years despite record tax receipts and yet infrastructure maintenance remained all but non – existent. With world leaders announcing stimulus packages (and I agree we need them) let’s not camouflage these massive fiscal announcements under the guise of combating the Global Financial Crisis (GFC). The problems in NSW (and the other states and territories for that matter) happened well before the GFC.

Last Friday, I read with interest an article on www.crikey.com.au by John Hewson – economist and former Liberal party leader titled “Hewson : we could see an election this year” where in part he made the following comment “At best, the Rudd Government’s second stimulatory package will just buy some time — simply delay the inevitable. As long as the global recession continues to deepen and, as a consequence, China’s growth continues to stall, the best Rudd can hope for is to hold up consumer spending by the cash handouts sufficient to avoid a technical recession — namely, two consecutive quarters of negative growth. “The plot this week began to thicken.

Ross Gittins from The Sydney Morning Herald www.smh.com.au filed this week an article titled “With best intent, politics intrudes” A great read so here are the first nine paragraphs “Kevin Rudd has long been afraid the downturn in the economy will cost him re-election, making his Government a one – term wonder. Malcolm Turnbull knows the downturn offers the best chance he’ll get to defy history and win the election, thus securing his own leadership.

These never – to – be admitted truths explain the political games both men are playing over last week’s budgetary stimulus package, even as the economy burns.

If you want to understand what’s happening in the economy and the rights and wrongs of economic policy you have to be able to distinguish between the politics and the economics. But that’s not easy because the pollies are always trying to disguise their political motives as economic.

Whatever successful politicians do or say, the political implications of what they do are never far from the front of their minds – even when they’re doing just what they should be doing in the nation’s interests.

As part of his long-running efforts to ensure he doesn’t get blamed for the recession. Rudd has repeatedly emphasised how bleak the news is from overseas and how badly it will affect us. It’s true, of course, but saying it is so often and so forcefully risks adding to the blow to business and consumer confidence.

Rudd hopes he can escape blame for the downturn provided he’s seen to have done his best to respond to it. That’s partly why he keeps popping up every few weeks with another measure to counter it.

Even so, mainstream economic gloom-from the International Monetary Fund to the Australian Treasury and most macro-economists – has been urging the Government to use the budget to stimulate demand, to make the stimulus big to get it happening as soon as possible.

It needs to be big because the global recession is expected to be so severe, it needs to start as soon as possible because getting in before the economy starts unravelling will be more effective.

Of course, the need for haste doesn’t justify Rudd’s attempt to push the legislation through Parliament in just a day or two.”

Back to the thickening plot of Rudd’s early election (alleged) plans. So this investigative agent went off to The Tally Room where he found that the Queensland Labor government must call a state election by September 2009. This is to win a fifth term where a loss would seriously impact what some media outlets are already calling the “Ruddslide”. A clue: infrastructure spending to improve state government perceptions for approval levels, maybe re-election?

Then the clanger in yesterday’s Daily Telegraph with the headline “Protect Rees, Rudd tells Labor MPs” I loved this – “Labor Party bosses have been ordered to protect Premier Nathan Rees from a leadership challenge and “calm down NSW” to allow Kevin Rudd to call a possible early election in the second half of this year.

Oh dear – what extent some individuals will go to, to preserve and stroke their suffering egos. A case of once bitten twice shy? Maybe a case of Sunrise to Sunset!

Next week, we address the amendment to Land Tax legislation where the Premier Nathan Rees introduced his premium rate and investment property owners had the current rate of 1.6 per cent increased to 2.00 per cent for investment properties valued over $2,250,000.

With GST receipts already down by approximately 40 per cent, the elected governments simply increase taxes which results in businesses reducing staff.

Nine years on – it is now revealed that GST has increased taxes NOT reduced them. The platform was fraudulently sold to the voting public.

The GFC did not help – however State governments are just as bad, even worse. They escalate the financial remorse for taxpayers and it will only get worse.

A hard week for all Australians, especially those involved in the tragedy of the bush fires in Victoria. We have placed a link on our homepage for those who wish to contribute.

http://www.rwm.com.au/2009/02/victorian-bushfire-appeal-2009/

Cheers ^__^

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13.02.09Robert Simeon3 Comments »