Recession is on the way - Part IV

[Grin]

1000 posts. Time for Part V?

Chief?

After 4000 odd posts, surely it's time for the 'Recovery is on the way part I' thread.

 

[fairdinkum]

After 4000 odd posts, surely it's time for the 'Recovery is on the way part I' thread.

Not until the Libs get back in. Whenever that will be.

 

[Puddy]

here in SA we need the libs to drag us out of recession but they are intent on losing the unloseable election

 

[Old Spice]

here in SA we need the libs to drag us out of recession but they are intent on losing the unloseable election

Aggh, jussst, aghhh. There's nothing better for a Federal Labor government than having inbred haemophiliacs in power, a timely reminder of how little is on offer when the conservatives get in. Theres only so many times you can cut expenditure.

 

[medusala]

Theres only so many times you can cut expenditure.

How many years post WWII has expenditure actually been cut in Australia by a federal government? Please enlighten us all.

Regardless the rational man would say that with government spending where it is a % of gdp, there is a vast amount of room to cut expenditure.

 

[Footy Smarts]

Interesting article by Ross Gittins in his usual no-nonsense style. In short the difference in economic performance between the mining and non-mining states has been overblown due to the use of State Final Demand rather than Gross State Product. The 2011-2012 figures show that those worried that Victoria and South Australia were in recession are miles off with growth of 2.3% and 2.1% respectively. Even Tasmania which is roundly thought of as a basket case with a shrinking economy had growth of 0.5% over the financial year. Interesting to think that even Tasmania, our clearly worst performing state, is currently doing better than a large number of developed nations.

He also has a not-so-subtle dig at the media for their reporting of state economic data. Seeing that this data (the real data!) doesn't fit with the media storyline of recession and south-eastern states seriously struggling they pretty much didn't bother reporting it.

www.theage.com.au/business/numbers-shed-new-light-on-real-state-of-nation-20121130-2amxx.html

 

[medusala]

Interesting article by Ross Gittins in his usual no-nonsense style.

"But a point to remember is that state populations are growing at quite different rates and this accounts for part of the difference in the rates at which their economies are growing. Only to the extent a state's gross state product per person is increasing is it better off materially."

Odd that Gittins doesnt make the same point re Australia's national GDP per head numbers during the GFC (might stuff up his claims of Keynesian munificence). Immigration has long inflated Australia's GDP numbers.

 

[Jentleman Geff]

Guess the Japanese economy is not too bad then considering the population is shrinking.

 

[Old Spice]

Why is this post stickied? The Mayan prophecy has more traction than this ludicrous thread.

 

[Upton Sinclair]

The Mayan prophecy has more traction than this ludicrous thread.

Beat me to it!

 

[Cmarsh]

Why is this post stickied? The Mayan prophecy has more traction than this ludicrous thread.

But remember if you create a thread trying to predict something is going to happen, eventually it probably will.
Religions have been doing this kind of thing for a very long time. The trick is to not give a time frame for when it will happen.
Therefore, I say this still has traction. Keep the thread open.

 

[mellowyellow]

are we there yet?

 

[Windhover]

But remember if you create a thread trying to predict something is going to happen, eventually it probably will.
Religions have been doing this kind of thing for a very long time. The trick is to not give a time frame for when it will happen.
Therefore, I say this still has traction. Keep the thread open.

Not just religions. Quantum mechanics implies that everything that can happen, does happen. So an electron that at time T1 is at A and at time T2 is at B is, between times everywhere in the universe. Or, from the title of the latest Brian Cox book, "Everything that can happen does happen". I see no reason why quantum mechanics does not accurately describe recessions.

 

[Upton Sinclair]

Caesar Why did the Policy Thread get dropped while this steaming pile of crap is still deemed sticky-worthy?

 

[tazzietiger]

JP Morgan believes the unemployment rate could rise to 6% this year with the slow down in the mining sector.
I don't think Swanny will allow that to happen in an election year he will spending another round of stimulus if it looked likely.

AUSTRALIA'S jobless rate will rise to 6 per cent this year as the mining boom fades, according to one of the world's biggest banks.
Financial services giant JP Morgan says Australia will not have a "seamless" economic transformation as the boom peters out and the central bank is likely to cut rates again in the coming months.
JP Morgan economist Stephen Walters says the RBA's rapid-fire rate cuts have done little to stoke the rest of the economy, and the broad impact of rate cuts may be waning.
Productivity was improving, Mr Walters said, but fewer workers would be required as a consequence.
"The jobless rate is likely to peak later in (this year) at 6 per cent," he said in research published yesterday.

http://www.heraldsun.com.au/busines...for-jobless-rate/story-fn7j19iv-1226547837173

 

[Upton Sinclair]

Maybe we should sticky a doomsday prediction thread as well?

 

[tazzietiger]

Caesar Why did the Policy Thread get dropped while this steaming pile of crap is still deemed sticky-worthy?

how is this thread harming you by being stickied. If you don't agree with it than just don't post in it.

 

[Grin]

It's not harming anyone, but you have to question why such a crap and delusional thread has been stickied.

It panders to mindless wingnuts desperation to promote their delusion of economic miss management, when the economy has, very obviously, been well managed.

 

[Upton Sinclair]

how is this thread harming you by being stickied.

It's not, I'm not sure why you think I think that it is.

 

[tazzietiger]

It's not harming anyone, but you have to question why such a crap and delusional thread has been stickied.

It panders to mindless wingnuts desperation to promote their delusion of economic miss management, when the economy has, very obviously, been well managed.

This thread is about discussing the global economy and the effects that could have on the Australian economy.
I don't see how that's delusional. I think promoting policies that have lead to peoples deaths as a huge success is delusional.

 

[mellowyellow]

here in SA we need the libs to drag us out of recession but they are intent on losing the unloseable election

Sounds very similar to whats occurring in Vic from what I hear

 

[Footy Smarts]

It's not harming anyone, but you have to question why such a crap and delusional thread has been stickied.

It panders to mindless wingnuts desperation to promote their delusion of economic miss management, when the economy has, very obviously, been well managed.

Personally I think it should absolutely be stickied, preferably with the earlier ones in the series for comedic value. Reading back through the threads has the potential for hours of fun.

It's particularly impressive how bad a number of posters (generally those rabidly anti-Labor) thought the problems were for our economy. In fact a number of them were saying how buggered we were, that there was likely no way of getting through it without recession and that Swan and Rudd were complete idiots economically.

Interestingly they're often the same posters who continue to criticise Swan as being economically incompetent despite Australia's current position being miraculously good according to their own previous estimates. Here's a quick sampling of some of the posts:

January 23, 2009

So does anyone doubt we will have a recession now?

January 20, 2009

Exactly.

Swan is a fair dinkum incompetent goose.

We'll all be rooned.

January 28, 2009

I am sure Rudd knows what he is doing is very sub optimal. Treasury and the RBA will have told him.

However he appears indifferent to the long term economic prosperity of the country.

Recession, deficit, rising unemployment, these are the facts now the property market will tank and all of the predictions by your rabid anti labor haters will be proven right.

Feb 19, 2009

Looks like the s**t is now really going to hit the fan

There's also the old use of "well if the entire picture is much rosier than we expected let's only worry about the bad stuff"

IIRC non-farm economy GDP droped by 0.1 or 0.2% in Sept Q and by 0.8% in Dec Q.

FWIW and we all knew it, the Aust non-farm economy is technically in recession

This last one is my personal favourite from the small selection I looked at. It was followed by a list of quotes by a particular poster saying that there was no certainty of a recession and that certain posters were being overly pessimistic.

January 31, 2009

You did say there wouldn't be a recession and the people here saying there would be had no idea because they disagreed with the IMF and various other institutions and economists (who all were wrong - BTW, I am going with "incompetent"). Here is a selection of your comments showing you were being a smart arse and wrong.

Of course everybody makes embarrassing predictions from time to time. But the amount of heat Swan and Rudd copped when they were implementing their response to the GFC was phenomenal in this thread. At the very least it should make some posters question their opinions on economics and particularly Labor's handling of the crisis.

 

[Effes]

JP Morgan believes the unemployment rate could rise to 6% this year with the slow down in the mining sector.
I don't think Swanny will allow that to happen in an election year he will spending another round of stimulus if it looked likely.

The government should take advantage of cheap debt to invest in much needed infrastructure.

Yields on bonds are at there lowest level in a long time.

http://www.afr.com/p/national/brace_for_falling_living_standards_flu2oHFYGZsmYCPZhOzKDJ

Professor Garnaut said Australians would not be so anxious about potential risks if governments had saved more of the resources boom since 2003.

Professor Gregory argued that fixing infrastructure problems in the biggest cities could help fill the gap when the resources investment boom ends.
He said the economy would face two contractionary forces, a sudden flood of surplus construction workers and the fact that much of the income from the subsequent export phase would flow to offshore investors.
He criticised the government’s handling of tax reform and said it should raise the goods and services tax to pay for infrastructure - a strategy gaining support at the state level.
“It looks now like we’ll get hardly any taxes out of mining; it looks now in retrospect that we may have given away too much in tax cuts and concessions in the past, so given that’s the situation, I really do think...[we] have to have a GST increase,” he said.

http://www.afr.com/p/markets/market_wrap/golden_chance_to_fund_infrastructure_DthxKX9sfX7emmZ8KABOjN

What may surprise some is that virtually every economist at the ABE conference agreed. What we now need are strategies to make a public financing program politically saleable.
If we don’t, we risk passing up a great opportunity to fund infrastructure cheaply in favour of more pain for our trade-exposed sectors and a property bubble.

http://www.theaustralian.com.au/bus...urrency-cold-war/story-fng7vg0p-1226534034313

What an opportunity to fund projects like the Melbourne Metro.

 

[tazzietiger]

USA GDP contracted in the 4th quarter .01% from 3.1% growth in the previous quarter.
First time the USA GDP has contracted in 3 and a half years.

http://www.tradingeconomics.com/united-states/gdp-growth

 

[tazzietiger]

Risks of a recession are rising but still low.

Australia faces a a “significant but low” 15-20% risk of recession as the mining investment boom fades, according to a research note by AMP Capital’s chief economist Shane Oliver today.
Here’s why Oliver thinks there is a risk of recession:
“Essentially, it’s argued that Australia has been propped up by a huge mining boom which boosted national income and in turn underwrote a boom in residential property prices.
With the mining boom fading, it’s argued the economy will collapse and unemployment will surge triggering a sharp increase in mortgage delinquencies and a collapse in house prices, ultimately leading to huge problems for the banks.”
Goldman Sachs last week put Australia’s risk of recession at 20% but said a recession would likely be avoided with better global growth, domestic policy stimulus and a lower Australian dollar.
And Bank of America Merrill Lynch economist Saul Eslake this week has a research noteputting Australia’s risk of recession at about 25%, with real GDP growth slowing from about 2.75% this year and next to 1% in 2015 and -0.1% in 2016, and unemployment reaching 7.5% in mid-2016.
On the flip side, Eslake says there’s a 75% chance of real GDP growth reaching just under 2% in 2015 and 1.5% in 2016, with unemployment peaking at 6.75% in early 2016.


http://au.businessinsider.com/shane...sk-and-why-it-will-probably-be-avoided-2013-6