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Australia Avoids Recession


dmc444

Active member
Joined
Feb 6, 2009
Messages
193
Australia has bucked the trend and this week has reveal that it has narrowly avoided recession.

The economy grew 0.4% in the first quater of 2009.

The government also introduced a number of multi-billion dollar stimulus packages, including increased infrastructure spending and cash handouts to most Australians since the end of last year to lift consumer spending.

Unemployment is still rising and Business investment is still expected to fall by around 20% as well as falling exports but Oz is still the only advanced economy not in a recession.

BBC NEWS | Business | Australia able to avoid recession
 

142857

Member
Joined
Dec 19, 2008
Messages
12
Recession dodged for the wrong reasons - ABC News (Australian Broadcasting Corporation)

Australia has avoided a technical recession - but for all the wrong reasons.

It's great news for the Federal Government and it is fair to say that Australia's economy is in better shape than most economies in the Western world.

But the truth is that despite the positive number the March quarter GDP numbers point to an economy in sickness, not in health.

Bear in mind, this is a highly technical measure. The main contribution to economic "growth" in the quarter was a collapse in imports, though a small growth in net exports helped too.

Thank the farmers for the boost to exports. Exports of cereal grains in particular were up sharply, but prices fell.

Why did imports fall? Largely because business investment has collapsed and companies aren't importing the capital equipment and production goods that they were during the good times.

That points towards rising unemployment as do all the forward indicators on jobs.

Look at the terms of trade (what Australia gets for its exports versus what it pays for its imports). The terms of trade fell 7.8 per cent. It was the surge in the terms of trade during the minerals boom that helped to boost national income, company profits and swell the Government coffers.

The trend is now very much in reverse.

So, national spending slumps and we escape recession on the arbitrary definition of two consecutive quarters of negative growth.

It just goes to show the silliness of getting hung up on the "technical" definition of recession favoured by some in the dismal science. The weird thing is that the economy has avoided shrinking because it's in a bad way.

The positive economic growth figure was all but guaranteed after yesterday's numbers on imports and exports, but those numbers were in fact a worry.

Chris Caton, one of the wise old men of economics here, says: "The so-called "technical" definition of a recession - two successive quarters of declining GDP - is nonsense; we know we're in a recession because of what has already happened to unemployment!"

That's how most Australians will measure how the economy is travelling. When people lose their jobs, watch their children struggle to enter the workforce, or see their work hours and incomes dwindle.

Footnote: It would have been a huge shock if the Reserve Bank had cut the official interest rate again, but the tone is dovish and the door is open.

The statement explaining the decision maintains the central bank's optimism that the world economy is stabilising after the sharpest slump since the Great Depression but adds: "The prospect of inflation declining over the medium term suggests that scope remains for some further easing of monetary policy, if needed."
 

Analyzer

Well-known member
Joined
Feb 14, 2011
Messages
46,201
Unemployment is creeping upwards.

China has enough skyscrapers, and too much real estate debt, for the medium term.
 

dent

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Mar 2, 2007
Messages
5,462
My niece is a qualified Social Worker specialising in the area of dealing with extremely vulnerable/troubled kids, and would normally have been snapped up by Social Services in Melbourne, but there's only agency work. There appears to be a freeze on public sector jobs out there as well.

On a separate topic, because I have, what I would call, a primary email address, I get incorrectly addressed emails from time to time, and one of them is intended for some Queensland builder....I got the following from the Queensland Building Commission

The Queensland building and construction industry generates around $60 billion each year and is one of the pillars of the Queensland economy.

To help ensure it has a bright future, we are reviewing the Building Act 1975 and the building certification process to help cut costs, reduce delays and remove unnecessary regulations for industry.

As part of the review we have been consulting widely with industry through a series of forums held across the State and by giving industry participants the chance to complete an online survey.

More than 400 people have either come along to a forum, or completed the survey and I thank everyone who took the time to share their views.

A report outlining the findings of the review is due in September and I will be in touch at that time to keep you up to date with the latest developments.

We are also introducing changes for the Queensland Building and Construction Commission (QBCC) which include:

• Extending the grounds for disciplinary action to include the failure of a contractor to pay a subcontractor in accordance with the contract

• Cutting red tape by allowing licences to be renewed every three years instead of every year

• Removing the need for certain licensees to provide their financial statements every time they renew their licence

For more information about these changes you contact the QBCC on 139333 or visit Queensland Building and Construction Commission.
 

devoutcapitalist

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Joined
Feb 26, 2013
Messages
16,607
It was a good election for the Australian Labour Party to lose last year to Abbott's Liberals. I hear Labour are ahead in the polls now in Australia even though the Liberals are trying to tackle the spending excesses of the Rudd/Gillard period (2007-13).

Yep the mining boom is over in Oz and maybe the long housing bubble will be over shortly as well.
 

frequency

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Joined
Sep 9, 2005
Messages
943
Well in the long term Australia is still a desert, unpopulated, and remote. Unlike Northern Africa, Europe and western Russia, and Asia, there is a reason that for 9000 billion trillion years basically no one lived in Australia.

It will be within a generation a sort of parochial semi-Asian country. Like an Isle of Man for China.
 
G

Gimpanzee

Well in the long term Australia is still a desert, unpopulated, and remote. Unlike Northern Africa, Europe and western Russia, and Asia, there is a reason that for 9000 billion trillion years basically no one lived in Australia.

It will be within a generation a sort of parochial semi-Asian country. Like an Isle of Man for China.
Can't make out if this is stupidity or performance art.
 

daveL

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Joined
Oct 29, 2010
Messages
19,593
Well in the long term Australia is still a desert, unpopulated, and remote. Unlike Northern Africa, Europe and western Russia, and Asia, there is a reason that for 9000 billion trillion years basically no one lived in Australia.

It will be within a generation a sort of parochial semi-Asian country. Like an Isle of Man for China.
that's proper cuckoo
 

Mad as Fish

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Dec 6, 2012
Messages
24,449
So where will Darling Joan hope to send the unemployed now? Australia in a situation that we mustn't call a recession 'cos that's just too damn scary, Canada bouncing around in a bubble that has to pop sooner or later while other EU countries have quite enough labour thank you very much. Will the emigrants soon be returning? They always have over the course of history (a higher % than usually assumed anyway) so it may just be a case of accelerating that trend with many finding that they may not be eligible for welfare for various reasons and so will not appear in the unemployment statistics, but they'll still be out there competing for work.
 

locke

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Joined
May 2, 2007
Messages
3,090
Germany has plenty of available jobs and they would welcome Irish people in preference to a lot of the other countries that provide immigrants.

There are quite a few jobs in parts of the UK at the moment, although I am nervous that their economy will slowdown significantly in the latter half of 2015. This would also be bad news for us as nobody needs a slowdown in their largest export market.
 

Carson

Active member
Joined
May 29, 2011
Messages
214
Germany has plenty of available jobs and they would welcome Irish people in preference to a lot of the other countries that provide immigrants.

There are quite a few jobs in parts of the UK at the moment, although I am nervous that their economy will slowdown significantly in the latter half of 2015. This would also be bad news for us as nobody needs a slowdown in their largest export market.
Yes plenty of jobs far closer to home than Australia. UK unemployment rate down to 6.5% now and falling. Germany is at 5.1% which is getting close to full employment. Not to mention the fact that our own unemployment rate is falling quickly and on track to drop below 10% by the end of next year.
 

firefly123

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Joined
Dec 8, 2009
Messages
28,155
Can i be the first to say that those drunken austrailians arent welcome over here being all loud, fighting and taking our jobs!
 

Mad as Fish

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Dec 6, 2012
Messages
24,449
Can i be the first to say that those drunken austrailians arent welcome over here being all loud, fighting and taking our jobs!
Not forgetting their flies and crap beer.
 
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