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-   -   Ecconomic Bust....or is it?? (https://www.pprune.org/pacific-general-aviation-questions/352360-ecconomic-bust.html)

nomorecatering 25th Nov 2008 05:54

Ecconomic Bust....or is it??
 
Jus wondering if the media are hypin up the ecconomic gloom for headlines. Just some observations.

Resteraunts, pubs and bars around Vic seem to be chockers on weekends and weeknights even.

The electrical stores that I visited when shoping for my plasma and blue ray have said that spending doesnt seem to be down, can be a few % points either way month to month. Still lots of bg ticket items walking out the doors every day.

Everytime i pass through Sydney and Melbourne airports they seem as crowded as allways. No obvious drop-off in pax numbers.

Tradies, builders, chippies etc are still going flat out....anyone tried to book a plumber lately.

Lastly, everyone I talk to says they dont seem worried about the gloomy ecconomic news, and more importantly, are spending the same way as they allways did.

Interest rates are down, petrol is way down in $$

So is it more myth than reality, a media beatup? At least in Oz.

Jabawocky 25th Nov 2008 06:26

I think there is definately a slow down, many companies are now feeling it start, and there is always a ripple effect. Of course slumpy thinking will make it even worse.

A bank or company may be in fine shape but a few investors think.... yikes I want out of XYZ so sell off their shares, a few more do the same and the prices drop then everyone jumps ship coz they see it dropping, next thing its a sunken wreck of what it once was............

Couple of QF flights last week were not as packed as they once would have been I think. QF 2 for 1 sale is an idea forward bookings are slow.

Does the media have an influence on this, you betya!:ok:

J:ok:

sms777 25th Nov 2008 06:53

It certainly does not bother our prime minister happily clocking up his frequent flyer points...
I am sure he said something along the lines that worldwide recession will spare Australia.
You may still see a lot of people in shopping centres but lots of them only window shopping.... well that's my observation in Sydney anyway.
Good to see that fuel prices come down....wondering where it is going to be around christmas :suspect:

denabol 25th Nov 2008 07:04

we'll all be rooned
 
At the moment in country NSW that big local talk is the imminent boom in pensioners spending the special payment they are getting to stimulate the economy. The way I hear the locals talk, it is all going on plasma TVs, home repairs, teeth, and a few knees-up at bingo which will probably see more of the old dears drop dead with excitement.

I don't think any of them will be spending up on air trips, maybe just the odd coach load of desperates heading for the casino.

Look I don't think the media has anything to do with it. They admit their sales and advertising are going down the dunny. I think print is dying and the electronic media just isn't up to it. You don't re listen to radio or TV, you hear it, see it, and then it is gone.

The reason the economy is rooted is the most of the brokers and a too many of the punters got shafted by what Business Spectator calls 'synthetic' trading. Loans or derivatives that didn't actually represent the making of anything useful, just massive bets on numbers and suckers and dodgy real estate bonds and the real one for idiots, CFDs or Contracts for Difference.

This has left a lot of people stuffed, even if interest rates keep falling.

As we often say out here, we'll all be rooned.

Cap'n Arrr 25th Nov 2008 08:05

I was under the impression that the more people spend in stores etc, the more it pushes up the dollars value?:confused:

Jabawocky 25th Nov 2008 08:39

it aint that simple...... if it was even I might understand it :}

Our interest rates oing up would push the dollar up, but right now its hard to say what will and will not affect anything:bored:

Capt Wally 25th Nov 2008 09:04

As another has said a slow down for sure.


Pubs & vars etc. will always have patrons, even if the wold stopped dead the pubs will still have the 'usuals' & some

Electical equip such as TV's will always be in demmand, people will go without other things to get the biggest & latest 'waste of time contraptions'

Holidays may suffer slightly but people will still travel by air for other reasons like family etc. 'cause it's never been cheaper than it has in the last 10 yrs & it's now a normal mode of transport even for the poor.

And as for tradies? Well don't talk to me about those useless bums (not all though) They will always be in demand simply 'cause most people can't fix/do things themselves, (nor are they allowed too with ref elect & plumbing )their too busy watching tha plasma bought with the lattest Govt handout!

Interest rates are down so that alone sparks a spending spree but only to be paid on the 'never never'! at a latter date.
For now the economy is down to the investots etc. but not to Mr & Mrs Joe Average, as long as they have credit cards & the banks are falling over themselves to lend money like it's Monopoly money then the economy is booming.
I'd hate to be a youngster now, it's a roller coaster ride for them .I've worked hard to get all I need & owe nufin' to nobody:)
Property, that's the way to go long term:ok:

CW

VH-XXX 25th Nov 2008 11:14

It is interesting that you have noticed pubs and bars as busy as ever because the news has recently been reporting that these areas have dropped off, along with retail spending, the lowest for over 10 years. Myer laid off quite a number of staff recently as Plasma sales are at an all time low.

The weekend paper in Melbourne said there were over 300+ high-end properties on the market across Toorak, Kew and Brighton and at this time last year there were 29. They attributed this to the "rich" people doing badly on the share market and needing to off-load their properties to subsidise their losses.

The economy affects everyone differently one can assume.

CHAIRMAN 25th Nov 2008 11:38

Wally you're right, over the long term property has been good.

But I wouldn't have liked to have purchased an investment property in the past 12 months!........but in the next 10 years, if you can hang on, you'll do well.

The share market is really no different, just easier to get in and out of, but it's a long term thing the same as property.

The key is to either switch quickly when things go titsup, or stay in for the long haul.

In the old days, super funds would recommend switching funds to cash within 5 years of retirement - now greed has caught the retirees who thought the gravy train would never end. I have no sympathy for them and their smartarse advisors who told them to stay in high risk.

The share market has already retreated severely. What is about to happen in Aussie in the short term is unemployment is rapidly rising - this will bring about a partial collapse in the property market from bank foreclosures. Remember that Mr and Mrs Joe Public have never been so committed to their mortgage as now, with both incomes necessary to service the debt, and maybe the one ar two investment properties! Take one wage earner out (and maybe also in the investment property) and there is deep doodoo.
The banks will run scared, and very little mercy will be shown.

All you youngin's out there take a tip from me - work hard, be good to yer mum.

Flyingblind 25th Nov 2008 12:25

Mighten be all dome and gloom, seems the love of credit may be on the wane by the masses, my mail is telling me Lay-By has never been so popular in those large family type stores.

This why GE Money left our fair shores? did they see the vast profit lake of easy credit dry up and hoist their main sail back to the land of easy money?

denabol 25th Nov 2008 21:11

super anyone?
 
The economic food chain is even more rooned if you rely on dividends from shares or your super fund.

Most super funds will be way down or even negative, that is, no cheques in the mail, for millions of Australians in the coming year. If you were living off QAN dividends, the living is looking pretty thin in the next year or so.

What we are seeing is the income stream of a huge part of the population throttled right back to idle or dead stop.

This is going to hurt, big time, and my main gripe with the media is they keep trying to fudge the situation by running patsy stories about how well positioned Australia is. Like, your arse up in the air is well positioned. Gimme a break.

Mstr Caution 25th Nov 2008 21:14


Property, that's the way to go long term
Maybe not that good in the short term though!

As recently as last weekend, the outgoing CEO of NAB (Michael Chaney)commented that he now sees parallels between the current conditions in Australia an the "property correction" of the early 1990's in Japan.

MC:8

VH-XXX 25th Nov 2008 23:04

Flying Blind, you must actually be blind, GE Money is still going strong right here in Australia. They haven't gone anywhere! They have dropped car loans and mortgages which weren't their core business anyway. They are still HUGE and Australia was less than 2% of the total company anyway.

Capt Wally 26th Nov 2008 09:58

Some good comments & thoughts here, a more serious subject than most aviation related ones.
"Chairman" well said:-)

Having been a manual worker all my life (holiday job now though:ok:) and born to Mr & Mrs average who had little all their lives I can't help but think todays society is a very different animal. To get what you wanted you simply got yr hands dirty & struggled big time 'till you got where you wanted to go. Nowadays the youth have totally different ideas. (18 yr old daughter & she knows it all!!:bored:) The best advice I can give is if you have a stable job STAY there unless yr dead sure another job is better. And to anyone still young enough to listen & do something about it is to spend as little as possible & save as much as possible, the pain now from doing that will be minute compared to where we are heading now. Bricks & mortar, shares to me are like standing in quicksand, it's only a matter of time before you go under anyway. Personal opinion only & you seek independent financial advice prior to doing anything CW says:ok:
To cut to the core, we are in for a rough ride in the future & only sensible decisions will see you thru.


CW

Mstr Caution 26th Nov 2008 10:36

Chairman,

I have to agree with you there regarding property in the short term.

Falling interest rates will not stabilise the property market. But as with any other property cycle, once it does turn in X amount of time, historically the gains have been around 20% over the first 12 months.

Unfortunately Joe Average is only considering falling interest rates as to the indicator for the direction of the property market. The interest rates although a factor will not determine the outcome for the property market.

The negatives as I see it are:

Affordability Rates (or lack thereof)
Reduced loan approvals indicating low demand
Low construction approval rates
Low consumer confidence
Volatile Share markets
Low pent up demand (underlying demand)for property in established areas
High Construction costs
Unemployment on the rise
High household debt levels
Retail sales figures
Fallout from the current global economic shocks
Diminished disposable incomes

My concern is the Federal government is encouraging first home buyers to purchase property, but what if those properties were worth 10 or 20% less next year?

flyinggit 26th Nov 2008 20:30

I would like one day to buy a house. I guess now might seem agood time with rates heading downward, maybe some cheap properties coming on the market but my flying career is taking me to places I've not seen before, the bottom of the money barrel:bored:.
"MSTR" I would have thought that buying a house is long term & if they (homes) where worth say 10% less next year as you said then that wouldn't matter in the long term? But I am happy to read all comments here.


Flyinggit

Mstr Caution 26th Nov 2008 21:29

Flyinggit - Yes I believe property is a good long term investment.

But for the reasons outlined above I believe it will be an even better investment buying in after property prices stabilise.

Why pay $450k now, when you might get the same property in late 2009 or 2010 for $400k.

CHAIRMAN 27th Nov 2008 11:19

Flyingit, sounds like a typical aviation career:ok:
The increased first home buyers grant was a pre-emptive, little thought out strategy to support the building industry at the expense of the buyers.
Maybe well intentioned by the gummint, but I'm a born cynic.
The grant at this stage is until June 30 2009 - who knows if they will extend it. Short term pump priming!
The share market will bottom before the housing market, so Flyingit, there is no need to rush in to any property purchase in the short term.

dudduddud 27th Nov 2008 13:42

the short of it is: yes the media here are hyping it.

in new zealand anyway, we are not looking bad. here we have relieved the international debt over the past 10 or so years to a point where the government can easily afford to pump $7B or so into the economy over the next 2 years.

that equates to 3% growth. guaranteed for the forecast recession.

in respect to the current 'economic crisis'; to adapt the words of our former prime minister David Lange, from his immortal speech affirming the moot of the 1985 oxford union debate that nuclear weapons are immoral:

"We in New Zealand, you know, like to be able to relax a bit, to be able to think that we will sit comfortably while the rest of the world seared, singed, withered. We're enraptured!"

suck it.

CHAIRMAN 28th Nov 2008 09:56

Thanks for that one dudddd - sound a bit like kevin kruddd!:ugh:


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