Wanted: A government that can read an economy!

Wanted: A government that can read an economy!

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The alarm bells became louder when it was announced last week that Australian GDP had contracted by 1.2 per cent – which quickly brought about the re-introduction of that R word – Recession. Blogs and newspaper reporting ran amok, with some suggesting that the East Coast of Australia was already in recession. This week the Reserve Bank of Australia (RBA) correctly decided to leave the cash rate steady at 4.75 per cent. I don’t believe we will find ourselves in a technical recession although I do concur with the economic analogies that the Australian economy is correcting.  However, I believe (and I’m sure the majority would agree) that the weakest link in the Australian economy is the Gillard government.

Natural disasters dominated our GDP results although it is becoming quite evident that many Australians think the Gillard government is the economic equivalent to Cyclone Yasi.

CEO Pulse: Confidence in Australian economy declines – the latest Business Spectator Accenture CEO Pulse survey shows that optimism in the domestic economy, has dropped 22 per cent, with surveyed chief executives running  companies with an Australian turnover of $100 million or more,– reporting a decline in optimism to 51 per cent, compared to 73 per cent in the first quarter of 2011. The CEO’s estimation of the government’s performance in managing the economy continues its downward trend, with an overall rating of 3.3 out of 10 – the lowest average score since the CEO Pulse survey was established in early 2010.

BUY PRINT

Wategos Beach, Byron Bay – Tim Mooney’s aerial photo library would have to the most extensive in Australia. If you want a special photo click on the link and ask Tim as he probably has it.

Carbon price would not cut jobs, says Federal Treasurer Wayne Swan. One should not forget that when the GST came in, we were assured that it would reduce taxes, only to see the opposite.  Julia Gillard feels the heat over carbon tax backlash as voters call for new election given the carbon price will continue to be increased not decreased. It is an ongoing saga especially when you read Robert Gottliebsen’s piece in Business Spectator A resource tax by another name – “Let’s strip away all the carbon tax political rhetoric. It is becoming clear that the looming carbon tax is simply a disguised resources tax on gas and coal exports. It’s the Ken Henry – Wayne Swan first mining tax all over again but without iron ore and copper.” Wayne Swan is desperate to get the budget back in the black (his ego demands it) and the carbon tax is his secret weapon – it has nothing to do with the environment it’s just another tax. Ziggy Switkowski entered the debate by declaring Refuse the carbon tax’s junk mail.Would we have a carbon tax if the budget was not hopelessly in deficit?  Of course not!

We’re still on track for a ‘big Australia’ by 2050 and it is refreshing to see where our new immigrants are coming from, given the focus on asylum seekers. When immigration heads north of 180,000, Australia’s population will be on track to reach 36 million by 2050. This is scary, given our infrastructure struggles to cope with 22 million. I did notice a missing link in the Migration Roller – Coaster graph is the “other” which contributes nearly one – third at 94,178? “Australia’s national infrastructure policy should be managed in the same way as monetary policy – by an independent body removed from politics” wrote Alan Kohler – Infrastructure too important to be left to politics.

I totally agree and I can see the advertisement – Wanted: A government that can read an economy!

Jonathan Chancellor’s Property Observer launched this week to rave reviews. In terms of subscribers, it has taken Virtual Realty News eleven years! Property Observer has all but eclipsed our subscriber numbers in the space of days. For all the property voyeurs who can’t get enough of Australian real estate reporting, subscription is a must and it’s  free!

House prices can’t go up indefinitely although it should be noted that house values spend a significantly greater time in the black than in the red – just that we read more when it ventures into the red! The ongoing debate is that Australian house prices are over- valued – however when this happens we see panic-selling, where supply well and truly exceeds demand.

To put this into perspective, Christopher Joye wrote this week in Property ObserverAussie housing stock is not too expensive. “One of the reasons banks have been prepared to lend so much for so long is the fact that borrowers have historically been vigilant in paying off these loans. Today there are slightly more than 30,000 borrowers who are more than three months behind on their home loan repayments, juxtaposed against a total pool of roughly 4 million to 5 million borrowers. That is, Australia’s “mortgage default rate” is a paltry 0.7%, despite our internationally high lending rates. This is less than one – 10th and one – quarter the equivalent US and UK default rates respectfully.”

Our local real estate markets are definitely not panicking and volume is the key performance indicator.

MOSMAN – 2088

  • Number of houses on the market last week – 118
  • Number of houses on the market this week – 107
  • Number of apartments on the market last week – 96
  • Number of apartments on the market this week – 97

CREMORNE – 2090

  • Number of houses on the market last week – 17
  • Number of houses on the market this week –  17
  • Number of apartments on the market last week – 37
  • Number of apartments on the market this week – 42

NEUTRAL BAY – 2089

  • Number of houses on the market last week – 13
  • Number of houses on the market this week – 11
  • Number of apartments on the market last week – 66
  • Number of apartments on the market this week – 63

For this week’s sales in Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Cremorne real estate, Cremorne Point real estate, Neutral Bay real estate, Cammeray real estate Click Here

Property above all things is my passion, so I found it very difficult to resist Jonathan Chancellor’s invitation to become an Observer, by regularly contributing articles to Property Observer.

Jonathan did express some concerns about my writing style (I believe he was politely referring to my political attacks). I referred him to this month’s Real Estate Institute of NSW Journal that ran the story “In blog we trust”, which was a critique of Virtual Realty News.

“The online revolution has changed the way real estate agencies do business. And you can be even more effective and successful by creating a specialised blog.” I did, however highlight “A mixture of local real estate news, statistics and astutely directed political comment. Virtual Realty News has generated not only a solid fan base, but has also brought the agency some very tangible benefits.”

Subscribe to Property Observer and read it for yourself next week. I’m still deliberating – should I go hard or adopt a ‘softly softly’ approach?

I will note your advice on our blog.

Cheers  ^__^

 

 

10 Responses to “Wanted: A government that can read an economy!”

  • Gordon says:

    Robert, you ask “should I go hard or adopt a ‘softly softly’ approach?”

    There’s only one answer to that – just keep doing exactly what you have been doing so well.

    In these times of trembling political correctness (even if it only runs one way. . .) it is more vital than ever that your fearless approach continues to enthuse your appreciative audience.

  • Chris says:

    Hi Robert,

    Spot on article. I’ll point yourself and the readers to a youtube video of Wayne Swan. I find it very amusing given the context of your article.
    http://www.youtube.com/watch?v=PtEyAe1QqCg

    Have a good long weekend everyone.

  • Ann says:

    Safe and relaxing weekend to all

  • Chris

    Thanks for the Wayne moment and it would be fair to suggest that nothing has changed 🙂

    Gordon

    I’m going to have fun this weekend putting it together – thanks for the always respected advice.

  • Thanks Rob. As always, a great read with terrific links to other great reads. Just subscribed to that other bloke.

  • Hotly Spiced says:

    Continue doing what you’re doing. We don’t need anymore bland, bland, bland. There’s far to much of that going on as it is.

  • Ann says:

    Cant believe only seen that Swan incompetent proof video just now. That one has been hiding

  • Wayne Swan……………………………..

  • Robbie Mac says:

    LOL – cue the Wayne Swan Youtube clip and the next highest is one of Tina Fey impersonating Sarah Palin. Just as Wayne Swan is impersonating a Treasurer, although the consequences are far less amusing when he is playing with (our) real money. Nice juxtaposition.

    As to “the other bloke’s” column – by all means, hit hard, and support your argument with facts and substance. Difficult to counter such a strong approach. Beware the quicksand of rhetoric though – many have been there before you, and we do not need any further visitors to such places. Stay true to a well informed message.

  • Ann says:

    You should watch question time and really see them at work. Its on Channel 2 from 2pm – 3pm

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