Economy XV

Yesterday the RBA cut the rates by 75 basis points. Today the US elect a new president.

What affect will either or both of these have on the local economy? And will the new president have an effect on the world economy?

So – keep all discussions on the economy here.

Update: Market news from overnight

  • Dow up 3.28%
  • FTSE up 4.42%
  • Allords down 0.08%

And the Australian futures are currently up by 2%, so it could be a positive day on the Australian markets.

 

(previous thread closed)

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12 Responses

  1. Local market is expected to open higher this morning following a lead from wall sreet and stronger commodity prices.

  2. I don’t mind if we go into deficit as long as it is spent wisely.

    http://www.news.com.au/couriermail/story/0,23739,24605334-5003402,00.html

    I believe there is too much emphasis on prevention when the cure should be the focus.

  3. The AUD just hit $US0.70 as well.

    And yep – I agree with you scaper. And I think our PM does as well.

    I’d have hated to have seem what the other mob would have done.

  4. Dave, as far as job losses go I believe the services industry will take the biggest hit.

    As people wind back their spending will do their cleaning, wash their dogs, ironing, clean their pools and wash their cars…these are just a few examples and these people will be the first to suffer in an industry dependent on peoples laziness!

    Business intentions on staff levels is deceptive as there are industries that won’t be affected like construction, I plan to slowly build up my staff numbers due to the demand that is unabated and the first quarter of next year I’m booked out.

    The hospitality industry will cop a hit and I see staff laid off and I see some restaurants going to the wall because of their financial philosophy of operating on an overdraft.

    The mining industry should fare well but the commodity price will be corrected as they are over-inflated and the price of steel will come down.

  5. Retail will also suffer.

    I just hope that people don’t rack up excessive credit card debt over Christmas, as I suspect the major retailers will be doing anything they can to encourage consumer spending.

  6. Retail will indeed suffer…yesterday when I went to get a quarter pounder at Macas that was in a specialty retail centre it hit me that the over- saturation of this industry that was built on the false assumption that people will spend spend, spend, I expect to see vacancies in that centre in the next year.

    If I was in that industry I would be studying the sales performance of each branch and making the decision on which branch or branches will have to close to ensure some semblance of profitability.

    This downturn will sort out the true operators, anyone with half a brain could have survived in business during the boom.

  7. Apparently this crisis has blown a forty billion dollar hole in the budget.

    http://www.theaustralian.news.com.au/story/0,25197,24605534-601,00.html

    I can see the public service being hit on this basis…but it was too heavy in my opinion.

  8. Construction will be stuffed.

  9. Everything will be stuffed!!

  10. including the Christmas turkey, which this year will probably be repalced with a can of SPAM.

  11. This kind of brings home the multi speed economy that we have.

    http://www.news.com.au/business/story/0,27753,24606060-31037,00.html

    I remain quietly confident about next year.

  12. Did anyone notice the economic outlook according to treasury?

    A morbid picture has been painted…I’m still quietly confident.

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