The Falling U.S. Dollar and the APA bid..
 

At the time of the APA bid, I suggested that the sudden rush of American capital into foreign assets had a reason - and that reason was going to be the meltdown of the American dollar. The American rich were jumping ship as quickly as they could.

They looked at Coles, they bought Vivendi in Europe (US$60 Bn.) and a heap of other assets. Anyone care to think how big a smile they would have had on their dials if they had succeeded in buying Qantas? A nice stream of Australian dollars coming in, made "bigger" each day (in U.S. Dollar terms) as the U.S. dollar depreciated. And I wonder how Australian banks, the ones that would have helped them buy Aussie dollars would have felt sitting on a mountain of U.S. dollars? Not good I would guess.

So what happens next? I guess Boeing and the U.S. aviation industry will be reasonably happy, since they are being handed a competitive advantage vis a vis Airbus. I would assume Cessna, Piper etc. would become a little cheaper in Australia, or at least not increase in price so fast. American aircraft workers and other manufacturing employees should have a bigger stream of work.

I've saved myself about $1500 in the last six months buying stuff from the states (mainly electronics) on the internet, and thats with paying GST.

Anyone else care to make predictions about winners and losers?

Us......... if the dollar continues like this!

Sunfish please consider running for pubic office. With someone as smart as you reckon you are, as Treasurer - or even PM - we should be laughing... :rolleyes:

Winners: those with a business model that can survive oil prices of US $150+ and rising a barrel.

Yes, The general public apres this election fiasco, Heard Costello-lie say on the radio this morning that subsequent governments inherit the benefits (or not) of the previous governments. That is true.

If such indeed is the case (which of course it is, based on Labors work in the early 90's) , then the current Liberal clowns have indeed squandered any margin to survive a global interest rate spike, and as my mate kerry packemin-a-mum who works in risk for a high street bank says, "we give stupid money to dumb people"

I predict most aussies are going to be losers, except the pitt street gang and of course little jonnies friends.

:ok:

And Australia had a foreign debt measured in hundreds of billions of dollars, a heritage of excesses in the Whitlam, Hawke and Keating years?

Ahhhh Air Ace, those were the days.

Days of wine and Roses. All the artists flew in and all the assholes flew out in 1972.... *sigh*

Labor's Beneficial Legacy
 

Floating of the Australian Dollar
Introduction of EBAs
Superannuation
Reduction in tarriffs that were turned into a wall by Black Jack McEwen and all but destroyed Australia's competitiveness
All initiated by Labor
Check out the interest rates when Little Johnny was treasurer during the Frazer years...around 18.5%
Do some research gentlemen.
PAF..the Google Economist

Pass-a-frozo,

No I'm not going to explain it , look it up for yourself, and please do not come all over "labor vs liberal" US style dumb-political labels on me, no party controls interest rates, no party can tell the future, no party can predict how the economy can go, no party can say more accurately than another that they would be better, but what we can say for certain, is that the current clowns have cooked the economy beyond belief and squandered any margin for error , when interest rates were at 18% here in oz as you are so wont to quote................. so too around the rest of the world were they my little jedi student, so too around the rest of the world...................don't choose Europe as a comparison ?


Labor under keating underpinned this future economic resiliance and toughness of this economy, but no amount of planning for bad weather can account for the current clowns squandering the margins in their pre-election charade to pull the voters in.

That tax give last month or so smacks of desperation. :D



doink....................from ninemsm of all sources, I apologise with reflux...:yuk:

I like your rose colour glasses! History being re written?

:}

Air Ace, the "foriegn debt" is private debt, not government debt. To be fair to Costello, he has really "fire proofed" the Australian economy as much as he can.

- Free market economics, minimal trade barriers, zilch government debt, labor market reform, what more can you ask for except some coal loaders at Newcastle, an inland railway joining Melbourne to Brisbane and water reform in the Murray Darling basin?

Except I forgot opening the skies to anyone who wants to fly here and jettisoning Qantas, and ripping apart Telstra.

Now wouldn't that be fun... privatising Qantas.

Now Sunfish, why wouldn't you agree Telstra deserves to be ripped apart?

Kiwiguy:Newsflash!
 

Qantas is privatised,listed on the stockexchange and has AGMs.Perhaps you could buy some shares and turn up at an AGM and express your surprise at its privatisation

I remember a while back when the dollar was .70 cents, VB got all excited because their financial planning was based on the dollar being around 0.60. I don't really understand all this stuff but my guess is that VB management are now getting hard-ons (well, the male managers at least ;) ) with the value of the Aussie dollar at .92

It's a good time to be buying Boeings or to be an Aussie traveling overseas - the winner at the moment is Qantas with surging passenger demand from Aussies heading overseas and depending on how they structured their aircraft orders, with cheaper aircraft, parts etc.

Yes if the APA bid had of worked some US backers would have bought in whilst the US dollar was strong and would be receiving Aussie dollar dividends by now! they'd still have to convert back to USD at some stage though - anyway alas for them.

Watch for AUD parity with the US dollar when they have a recsession next year and we're cranking up our interest rates here - high interest rates in Australia and a surging economy makes it an attractive place to park your money if you're an American fund manager! the south pacific peso is all grown up :ok:

And Kevin Rudd as quick as a flash put up his hand and said "me too".

Only because if he did not, TT or ACA would have nailed him and legions of people who do not know any better or who watch those programs would have been swayed. Realpolitik you see - not nice, barely palatable and definitely not honest - but hey ya get what ya vote for.

The tax breaks make absolutely no material difference to me, and they will in due course (after a few more interest rate rises - which howard in the last election promised not) make absolutely no difference to the target market.

I've no personal beef with either party, I just don't like smug liars, who can occur in each, obviously the incumbent party has the potential to do the most damage, and currently, that seems to be the case. :*

rates up again, seems li'l jonneys' crystal ball is failing................. :p

and so close to an election too.................:ok:

LJH annoys me when it comes to IR but he NEVER promised interest rates would never go up...he simply 'promised' to keep them at historic lows...they are at historic lows...ergo he didn't 'break a promise' let alone 'lie'.

Rudd is however missrepresenting the truth by suggesting otherwise.

I was watching the usual role of people 'at greatest risk' from the interest rate rises being trotted out on the TV tonight...these people are at risk of going under from an extra $50-100/mth. They are at risk because they are stupid...no govt of whatever persuasion could ever hope to save them from themselves so LJH is being completely honest when he commiserates that their plight is sad but there is NOT A DAMN THING HE CAN DO. Rudd is being dissengenuous in the extreme when he suggests things would be any different under his Govt....they just won't be.

I think LJH has become disconnected somewhat from reality...30 years a polly will do that...his time has passed and I think he will not be PM in a few weeks....but make no mistake Rudd will be a passenger with no ability to change the course of the economy to save those lower income earners who are in debt way over their heads who are too young to remember 12-20% interest rates of the 70s/80s etc.

There was a young women on tonight (sat in her house surrounded by flat screen TV and all manner of gadget with at least two children and probably two cars in the garage) bitter that she was being put under intolerable financial stress and blaming LJH's 'lies' and she was going to vote Labor as a result...she believes that will save her...as though this completely missrepresented 'lie' that he promised interest rates would remain at historic lows meant she would never see a rate rise. This is loony tunes stuff...she and 100s of thousands of others are at great financial risk because they want it all now.

I suggest what will happen in the next years is Labor will preside over interest rates hitting double figures again and there will be blood on the ground...programs like AcA will be appoplectic with fake rage over the foreclosure rates skyrocketting and house prices in many areas plummetting...it is happening in the US now and IT WILL HAPPEN here in the next few years...bank on it...there isn't a fecking thing any Govt can do about it.

There has been alot of GST go into the coffers on the backs of these people and the huge explosion in consumer credit debt in this country over the last 10 years.