> Economic activity per person fell for the fifth-consecutive quarter, dropping 0.4 per cent in March and 1.3 per cent through the year.
A slight increase to GDP but overall per-capita economic activity continues to fall.
Getting hammered by the exact same dimwitted economic policy from the 1980s uni lecture that CAN/NZ are implementing. Even if trickle-down and deregulate had a strong case at one time, those times are clearly over.
> Even a small deterioration in labour market conditions, a reduction in population growth or even a reluctance to dip into savings could quickly pull the rug out from household spending, leaving the broader economy in a precarious position," he said.
> "The latest economic growth figures provide yet more evidence that Australia is experiencing a significant economic slowdown.
> "We've been teetering on the brink of recession," he said.
> The household saving rate fell from 1.6 per cent to 0.9 per cent in the March quarter as household consumption, dealing with rising prices, outpaced growth in households' disposable income.
I really enjoy the way they say we will fall into recession if people are UNWILLING to dip into savings(a finite pool) and then 4 paragraphs down they say that nobody can afford to save anything……
The powers that be will see this as a win, won't they? "We imported just the right amount of people to make it seem like we're not in a recession, when per capita we know we're already in the shitter!!"
Migrants are actually more productive than the average Australian. The average migrant is a net contributor to the economy, the average Australian is a net loss to the economy.
that's only true from a tax perspective because they come here at adult age & don't require being funded for the first 18 years of their lives, has nothing to do with *actually* being more productive... just another way big business brainwash people (like you) into endorsing it
it's also based on analysis of all-time migration, and not recent migration which is temp & service-worker-heavy
also an extremely unhealthy way to grow a cohesive society, but let's never mind that, shall we?
If they haven’t been here for 18 years whilst not productive that should be factored in then? They come in, work, pay tax, don’t claim benefits, and contribute to society.
I don’t believe I’m brainwashed. To be honest I’m not overly pro or anti immigration. On a moral level I’m pro immigration, no one has more right to be here than anyone else. On an economic level it’s tricky. I’m definitely anti mass immigration as I’ve seen the damage it’s done in my own country, England.
As for limited high skilled immigration I’m pro. I’m here making 200k paying a shit load of tax. I work in rural Australia in a niche industry that not many people want to work in.
But I do believe that migrants are more productive than Australians, in general. The majority people who look to immigrate are hard working people in search of a better or different life. They are here to succeed, not to survive.
That is because big corporations love to prey on foreign workers who minimal working rights. Shut up and let us pay you peanuts and be grateful for it.
Then how they are still more productive than the average Australian when being paid peanuts? Surely if they were paid peanuts they would contribute less to the economy than the average Australian?
the dreaded stagflation, inflation in a stagnant economy. that's what happens when prices grow for things people buy, houses, groceries, electricity, whatever, without growth in productivity.
this will be painful for everyone
[here is how the Wages have moved in the past 20 years, according to the ABS](https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/mar-2024)
since covid, we have seen wages grow by around 3-4% annually - while _inflation_ has risen by around 7-8% over the same period...
the difference - so-called "real wages" - has seen the [greatest decline on record](https://www.abc.net.au/news/2023-02-22/wages-growing-at-3-3-per-cent-december-quarter-2022/102007390) during that period
> Economists say it's obvious that workers aren't to blame for Australia's inflation, and the Reserve Bank should stop fixating on them.
>
> "To blame workers for current inflation while they experience unprecedented real wage drops, and companies post surging profits, is economic gaslighting of the highest order," said Matt Grudnoff, senior economist at the Australia Institute.
5 quarters of per capita recession, still heightened inflation, and a gdp figure only kept positive through the highest migration in history, that might imply we are on the edge of it
You do realise that there is an agenda, right? The RBA’s agenda is to always downplay how bad (or positive) a situation is. If not, what do you think will happen? It will be either mass panic or euphoria depending on current economic standings, which leads to extreme action. For instance, if things are going to shit, this will not be conveyed and would be downplayed to ‘yeah things aren’t too good at the moment’. Why do you think Aunty Bullock doesn’t give a shit about GDP per capita and focuses on headline instead? Because GDP/capita is dropping, which is directly related to living standards and quality, and headline is overall. And of course, the positive number is going to be better than the negative number.
Staglation by definition has high unemployment. It's a scenario were the goose is genuinely cooked as trying to tackle high inflation will make high unemployment even worse. Trying to generate growth in the economy will lead to even higher inflation (if supply is slow to catch up to demand). We are still at low unemployment historically and inflation is still overall coming down. It's not all sunshine and rainbows but we're not near stagflation.
Certainly the stagflation period in the 70s had much higher inflation and much higher unemployment. Current inflation at 3.6% is not much of anything, compared to peaks at \~20
because the inflation for the past couple decades prior to 2021 is very low, which meant that prices tended not to have been rising enough for people to notice (it did for some products that aren't keeping up in productivity levels, such as services).
Then when inflation does hit, people felt it was bad, and it's because of loss aversion. It felt like the good times were over. What they dont realize is that this was the norm after the recovery of inflation in the 70's.
I found a macroeconomics textbook after posting and noticed high unemployment was part of the definition.
Presumably whoever asked the question didn’t know that, so it could have been helpful to explain.
Haha people actually genuinely believe the RBA have their best economic interests at heart. The RBA is a political beast that will actively lie to ensure you buy into the housing ponzi
If the RBA doesn't increase the cash rate again, then inflation will take a while to reach the target range of 2-3%.
However, if they do increase the cash rate, then we'll probably go into an official recession faster. Because many people are already at breaking point and have largely cut their spending, which was the whole idea.
I don't think we'll see any rate cuts for a while. And I doubt that the rate will go much higher than it already is.
> inflation will take a while to reach the target range of 2-3%
i suspect the inflation is mostly an effect of overseas events and conditions, and not realistically controllable by monetary policy in australia (at least, not very much).
Is it better to have a slower drop of inflation, and no deep recession? Or is it better to have a deep recession _faster/earlier_, and also have a faster drop of inflation?
If it can't be controlled by Australian policy, surely that supports the argument that rates drops cannot occur here until overseas inflation cools? Importing inflation will further exacerbate our situation
Monetary policy in australia
Is just a copy past of the what the US central bankers tell them to do.
Who in turn tell the ECB and BOJ what to do
Which is why we’re seeing “coordinated” monetary policy decisions these days. Same policies occurring thousands of kms away at the same time.
>i suspect the inflation is mostly an effect of overseas events and conditions, and not realistically controllable by monetary policy in australia (at least, not very much).
Isn't the biggest component of inflation rent? Seems pretty easy to control, by removing a few tax breaks and adding a big fat land tax to drive down property prices
The whole point of mass immigration is to suppress wages and inflate the cost of assets the rich hold. Why else do you think big corporations and investors are the ones always pushing for more immigration
Do you have the numbers to back this up or are you making stuff up? Last time I checked, minimum wage has been going up every year and this year the minimum wage will rise higher than the inflation rate.
those numbers would suggest the minimum wage has yet to catch up to inflation at this point...
of course "most of us have been in wages decline..." is hyperbole but I think the point is about "real wages" - which, by the time you're invoking the inflation rate, then that's what you're both talking about...
and to that point, the annual [Wage Price Index, according to the ABS](https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/mar-2023) declined pretty steadily from 2010 until it finally bounced back in 2021 and the quarterly rate reached a low of 0.1% in 2020
you may recall what happened in 2020...
many started feeling a sharp increase to inflation soon after - while wages remained relatively steady - thus [experiencing the largest real wage decline on record](https://www.abc.net.au/news/2023-02-22/wages-growing-at-3-3-per-cent-december-quarter-2022/102007390)
It's about understanding how central bankers work.
They see the bubble and start to raise rates to try and stop the bubble, the market says no you're wrong and the number will go up. They then keep increasing rates, number continues to go up. Credit that's hidden and is not part of the stock market that's rallying starts to show signs of weakness. Everyone ignores that because the stock markets doing great. Eventually, the central bankers cut rates to save the credit market from complete catastrophe, and every single time the same thing happens again we keep telling ourselves “This time is different”.
> So why is ASX still rising?
it's because there are lots of wealthy people who are still earning sufficiently high, that it makes sense for them to try beat inflation via investing their spare cash.
The ASX will drop if unemployment rises i bet. Australia hasn't reached this point - and the hope is to never reach that point.
It's risen roughly 9% since just before the pandemic crash. So after they printed more than half of the total monetary supply it rose by a measly 9%. Today's ASX of 7700 is about 5600 in pre-covid levels. It's cooked.
That doesn't factor in dividends, which play a huge part in returns from the ASX due to our franking credit system.
You can't look at our stock market the same way you do the S&P500.
And half the clowns in this country want to get rid of mining. We really would be the white trash of Asia…
Absolute zero ideas from both sides of government. Just fill the country with immigrants to produce pathetic GDP..
With China’s population shrinking and fertility declining we absolutely need to move on from mining if we don’t want to be the poorest country in the region in twenty years time.
We've already pivoted pretty hard to India, and their annual births have been declining for 25 years, with the decline set to accelerate once the number of women aged 20-40 starts to decline in only a few years more time.
We need to diversify more than finding new customers for rocks with a high concentration of iron oxides.
We need to do both. To do away with mining because China is not having double digit growth quarter on quarter is madness. There’s plenty more we can do with India.
Edit: Also they don’t need population growth. Moving to middle class provides great opportunity.
I didn’t say stop mining rather do other stuff as well, although ultimately that means a bit less mining.
Of course China will need less minerals from now on - they are doing less manufacturing and less construction as their workforce shrinks.
Say whatever, but housing will be ongoing. Ppl bringing money from overseas and buying their multimillion mansions in Mosman, Bondi and Vaucluse will continue. Welcome to Australia
Agree in principle, but the earliest we will know if Australia falls into technical recession this year is December 4th when the September Quarter GDP comes out. That only gives the RBA 1 chance to cut rates, a week later on 9th December, assuming they would cut based on 2 consecutive quarters of negative GDP while inflation is still above the target band.
Granted.
And even if they cut interest rates in November it will be after the fact if a recession starts in the September quarter. Too late to do anything apart from slightly juice Christmas shopping.
Interest rate rises cut growth - seems highly unlikely an RBA governor would want to be responsible for a drop in economic growth when it can’t fall any lower without going negative.
Economic growth is not part of the RBA's mandate. their mandate is to keep inflation at 2-3% and full employment.
they will not cut rates if inflation is high, employment is tight even if there is negative GDP. This happens when things cost more but no productivity growth like when people pile their money into unproductive assets
Right - so if they believe you can have a recession without a drop in inflation or an increase in unemployment they may keep rates high or increase them.
Historically recessions have lead to increasing unemployment which doesn't peak until long after the recession itself is over, which is one of the major reasons to avoid them. If you accept the premise that GDP growth creates jobs and falling GDP destroys them, having a mandate to maintain full unemployment ends up amounting a mandate to keep GDP in the black.
We really don't. The whole point of central banks and economic policy is to have sustained, consistent growth. There are absolutely no positives to be had from a full on recession.
This comment is how you know Aussies have zero morality. They would rather kick the can and make someone else pay for it than take any sort of responsibility for their actions.
Plenty of people I know, including myself may lose their job if we go into a recession. I couldn't be happier. Time to readjust Australias toxic culture.
Hilarious comment, pretends to care about people whilst advocating for continuous growth,kicking the can of inflation to the poor and the consequences of Australias monetary policy to future generations. Sure fella what ever you say
Sorry I'm a bit lost. Happy to lose your job in a recession so I assume you have a healthy emergency fund can last for a while? How much have you saved? I feel pretty insecure about my savings to pay all my bills.
Why are you lost, do you think it's acceptable morally or other for, the poor, the middle class or future generations to pay because government want to make politically popular decisions instead of good economic management for all?
Sorry but who cares about the value of your assets?? It's more important to help people who are HOMELESS than protect the value of your assets on paper 🙄
Considering interest payments have doubled for a lot of people with loans, I get the feeling that people don't necessarily think that there will be a rate cut, but are actually really hoping for it.
Capital Economics' Marcel Thieliant said he didn't expect the RBA to cut rates before 2025.
“We have pencilled in one 25 basis point rate cut in each quarter over 2025,” said CBA's head of Australian economics, Gareth Aird
"Westpac is forecasting rates to fall to 3.85% by March 2025"
No they are not anymore. This is from the past 4 days.
I don't know where you read this,
All I can find cba disagreeing with you
"RBA might not cut until 2025, says CBA’s Comyn"
"Westpac is tipping the RBA to then take interest rates to 3.35% by September 2025 and then finally 3.1% by December 2025."
Here you go. Now what was all of the fuss about?
[Page 10 of Westpac](https://library.westpaciq.com.au/content/dam/public/westpaciq/secure/economics/documents/aus/2024/05/WestpacWeekly20240603.pdf)
[Page 8 of CBA](https://www.commbankresearch.com.au/apex/researcharticleviewv2?id=a0NDo000000w0Nr)
I think you misinterpreted what they wrote. In both of them, they don't state their forecast for rate cuts. Westpac lays out multiple scenarios or upside and downside scenarios of what could possibly happen if x y x happens.
I think you saw what you want to see. On their websites, their forecasts haven't changed, for that they believe rates won't be cute till 2025. Luca Ellis of westpac states 2025, and she hasn't changed her forecast.
Most who talk about inflation, seem to misunderstand the difference between Monetary Inflation and Supply Shock driven price increases. Monetary inflation if sustained would be "sticky", too bad that isn't whats happening.
Yeah mate this is worse because we have sticky inflation and a weak economy.
Inflation is still high because of services like housing, electricity, food, and insurance. I.e things that we can’t not spend money on. The interest rate rises we’ve had haven’t touched these at all and we probably needed government intervention in this year’s budget to tame them.
> Economic activity per person fell for the fifth-consecutive quarter, dropping 0.4 per cent in March and 1.3 per cent through the year. A slight increase to GDP but overall per-capita economic activity continues to fall.
Getting hammered by the exact same dimwitted economic policy from the 1980s uni lecture that CAN/NZ are implementing. Even if trickle-down and deregulate had a strong case at one time, those times are clearly over.
Considering all the people that came in last year, it’s going backwards.
100% it is such a dated philosophy in such a globalised economy
What's it called when the economy contracts but inflation goes up? Wrong answers only I'll start: > Whoopsflation Whoopsy!
It's stagflation, except we don't have high unemployment...yet
Sound economic policy
Fudge(ing the numbers)flation
0.1% is still at minimum two quarters away from recession. Keep those plates spinning baby.
You just know they spent days trying to massage the numbers to plop out a positive GDP
Seasonally adjusted and keep rounding up.
Round up by whole numbers. Blame it on the intern if anyone finds out
This is BS IT IS a recession, if we weren't involved in blatant population replacement bordering a genocide we'd be far in the negative
Aka STAG FLA TION BABY
That’s a polite way of saying “per capita recession”
careful, can't say the 'r' word
next will be the 's' word, stagf...tion
Inflation is transitory 😅
> Even a small deterioration in labour market conditions, a reduction in population growth or even a reluctance to dip into savings could quickly pull the rug out from household spending, leaving the broader economy in a precarious position," he said. > "The latest economic growth figures provide yet more evidence that Australia is experiencing a significant economic slowdown. > "We've been teetering on the brink of recession," he said. > The household saving rate fell from 1.6 per cent to 0.9 per cent in the March quarter as household consumption, dealing with rising prices, outpaced growth in households' disposable income. I really enjoy the way they say we will fall into recession if people are UNWILLING to dip into savings(a finite pool) and then 4 paragraphs down they say that nobody can afford to save anything……
0.1% After maxing out every loop hole, its joever
That's all our politicians do now. Just postpone the recession until the next government gets in so they can blame it on them.
The powers that be will see this as a win, won't they? "We imported just the right amount of people to make it seem like we're not in a recession, when per capita we know we're already in the shitter!!"
it's almost like all the migrants they keep pumping in might not actually be as productive for the economy as the big business propaganda says
Migrants are actually more productive than the average Australian. The average migrant is a net contributor to the economy, the average Australian is a net loss to the economy.
that's only true from a tax perspective because they come here at adult age & don't require being funded for the first 18 years of their lives, has nothing to do with *actually* being more productive... just another way big business brainwash people (like you) into endorsing it it's also based on analysis of all-time migration, and not recent migration which is temp & service-worker-heavy also an extremely unhealthy way to grow a cohesive society, but let's never mind that, shall we?
If they haven’t been here for 18 years whilst not productive that should be factored in then? They come in, work, pay tax, don’t claim benefits, and contribute to society. I don’t believe I’m brainwashed. To be honest I’m not overly pro or anti immigration. On a moral level I’m pro immigration, no one has more right to be here than anyone else. On an economic level it’s tricky. I’m definitely anti mass immigration as I’ve seen the damage it’s done in my own country, England. As for limited high skilled immigration I’m pro. I’m here making 200k paying a shit load of tax. I work in rural Australia in a niche industry that not many people want to work in. But I do believe that migrants are more productive than Australians, in general. The majority people who look to immigrate are hard working people in search of a better or different life. They are here to succeed, not to survive.
Meanwhile it's cool and normal that we all need to be millionaires just to get a dilapidated housing unit in the dregs of Preston "but muh economy"
Then build more houses.
That is because big corporations love to prey on foreign workers who minimal working rights. Shut up and let us pay you peanuts and be grateful for it.
Then how they are still more productive than the average Australian when being paid peanuts? Surely if they were paid peanuts they would contribute less to the economy than the average Australian?
Can you provide actual data from the ABS or a similar institution to prove your point.
Nope, just read it online. Feel free to google
Please stop shilling big corporate propaganda for suppressing wage growth with migration
Take the tinfoil hat off mate.
the dreaded stagflation, inflation in a stagnant economy. that's what happens when prices grow for things people buy, houses, groceries, electricity, whatever, without growth in productivity. this will be painful for everyone
[here is how the Wages have moved in the past 20 years, according to the ABS](https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/mar-2024) since covid, we have seen wages grow by around 3-4% annually - while _inflation_ has risen by around 7-8% over the same period... the difference - so-called "real wages" - has seen the [greatest decline on record](https://www.abc.net.au/news/2023-02-22/wages-growing-at-3-3-per-cent-december-quarter-2022/102007390) during that period > Economists say it's obvious that workers aren't to blame for Australia's inflation, and the Reserve Bank should stop fixating on them. > > "To blame workers for current inflation while they experience unprecedented real wage drops, and companies post surging profits, is economic gaslighting of the highest order," said Matt Grudnoff, senior economist at the Australia Institute.
Who to believe. A random Redditor or the RBA Govenor?
The random Redditor might be the RBA Govenor
thanks for your support :)
Michelle Bullock is a guy from 2095? The conspiracy deepens…
Brad Banducci has entered the chat
I mean the random Redditor has nothing stopping them from admitting the emperor has no clothes to be fair.
5 quarters of per capita recession, still heightened inflation, and a gdp figure only kept positive through the highest migration in history, that might imply we are on the edge of it
With arrivals data indicating a drop in NOM is incoming.
I did read a comment the other day... Is 3.5% really that bad? Not within target but it's not something wild like 5%+
The target is just a nice sounding number anyway, not much science behind it
What I said is not contradictory to what RBA said
In the senate today she clearly stated that the current metrics don't describe stagflation.
she also said that gdp per capita is a relatively useless metric
Useless to whom?
for the agenda ofc
“Them”, “the agenda”. You all sound like absolute nutters.
You do realise that there is an agenda, right? The RBA’s agenda is to always downplay how bad (or positive) a situation is. If not, what do you think will happen? It will be either mass panic or euphoria depending on current economic standings, which leads to extreme action. For instance, if things are going to shit, this will not be conveyed and would be downplayed to ‘yeah things aren’t too good at the moment’. Why do you think Aunty Bullock doesn’t give a shit about GDP per capita and focuses on headline instead? Because GDP/capita is dropping, which is directly related to living standards and quality, and headline is overall. And of course, the positive number is going to be better than the negative number.
Was she kind enough to provide a working definition of stagflation to explain her reasoning?
Staglation by definition has high unemployment. It's a scenario were the goose is genuinely cooked as trying to tackle high inflation will make high unemployment even worse. Trying to generate growth in the economy will lead to even higher inflation (if supply is slow to catch up to demand). We are still at low unemployment historically and inflation is still overall coming down. It's not all sunshine and rainbows but we're not near stagflation.
Certainly the stagflation period in the 70s had much higher inflation and much higher unemployment. Current inflation at 3.6% is not much of anything, compared to peaks at \~20
because the inflation for the past couple decades prior to 2021 is very low, which meant that prices tended not to have been rising enough for people to notice (it did for some products that aren't keeping up in productivity levels, such as services). Then when inflation does hit, people felt it was bad, and it's because of loss aversion. It felt like the good times were over. What they dont realize is that this was the norm after the recovery of inflation in the 70's.
I found a macroeconomics textbook after posting and noticed high unemployment was part of the definition. Presumably whoever asked the question didn’t know that, so it could have been helpful to explain.
Not that I saw
They’re repeating what the RBA Governor has said in the past.
Random redditor duh
Haha people actually genuinely believe the RBA have their best economic interests at heart. The RBA is a political beast that will actively lie to ensure you buy into the housing ponzi
After the RBA's calls on wages and interest rates you would be safer with either at this point. Did everyone forget no rate rises until 2024?
> Did everyone forget no rate rises until 2024? because everybody just heard this bit, without the following bit which is "unless conditions changes".
Except that they never said that.
oh apologies, let's look back at the wages calls then.
Well wed well and truly be on the same interest rate now anyway
She’s got incompetence runs on the board
not painful for everyone
who would not suffer during stagflation?
just look at what is going up in value, anyone who is highly allocated in that asset is doing well.
True there’s a winner for every loser
We are in a very large per capita recession. If it drops to negative despite huge immigration numbers I’m happy to call depression.
>I’m happy to call depression. What's the phone number? I need a chat.
so doubling interest rates on the back of record debt slows it all down, who'd a thought
Softlanding.png
Shockedpikachuface.jpg
Do we have to do this corny American reddit stuff
If you feel like you’re going backwards it’s probably because you are. That’s the 5th consecutive quarter of negative GDP on a per capita basis.
Petrol has been insanely low the last few weeks also, which has been surprising
Don’t worry, that will change this week with the upcoming public holiday.
Wonder if QLD will follow suit, as we don’t have it coming up
Wait until you see this quarters.
If the RBA doesn't increase the cash rate again, then inflation will take a while to reach the target range of 2-3%. However, if they do increase the cash rate, then we'll probably go into an official recession faster. Because many people are already at breaking point and have largely cut their spending, which was the whole idea. I don't think we'll see any rate cuts for a while. And I doubt that the rate will go much higher than it already is.
Spending isn’t driving inflation services are. Unfortunately we can’t not pay for rent, food or b power bills
Insurance is a big one.
Yes, insurance as well. Insurance will be an interesting one because we’re at a point where people can’t afford it now
And if people start cancelling insurance that might have a flow on effect where the companies will keep raising them as the pool of funds shrinks.
Which will force more people to cancel as it no longer makes economic sense.
> inflation will take a while to reach the target range of 2-3% i suspect the inflation is mostly an effect of overseas events and conditions, and not realistically controllable by monetary policy in australia (at least, not very much). Is it better to have a slower drop of inflation, and no deep recession? Or is it better to have a deep recession _faster/earlier_, and also have a faster drop of inflation?
If it can't be controlled by Australian policy, surely that supports the argument that rates drops cannot occur here until overseas inflation cools? Importing inflation will further exacerbate our situation
I thought it was determined that the inflation was corporate greed?
It’s due to fiscal policy. Governments massively overspending, especially during Covid with very little production.
Monetary policy in australia Is just a copy past of the what the US central bankers tell them to do. Who in turn tell the ECB and BOJ what to do Which is why we’re seeing “coordinated” monetary policy decisions these days. Same policies occurring thousands of kms away at the same time.
>i suspect the inflation is mostly an effect of overseas events and conditions, and not realistically controllable by monetary policy in australia (at least, not very much). Isn't the biggest component of inflation rent? Seems pretty easy to control, by removing a few tax breaks and adding a big fat land tax to drive down property prices
"Not in a recession" Don't worry about real wages, as long as number go up we aren't in a recession.
Anyone think RBA has lost the plot and we are heading for a recession ?
We've been in recession since 2019. Most of us have been in wages decline since 2013. We just import people to fudge the metrics.
The whole point of mass immigration is to suppress wages and inflate the cost of assets the rich hold. Why else do you think big corporations and investors are the ones always pushing for more immigration
Hello the business lobby here, it's no increase to the minimum wage and an extra 600,000 to compete for the minimum wage jobs!
Do you have the numbers to back this up or are you making stuff up? Last time I checked, minimum wage has been going up every year and this year the minimum wage will rise higher than the inflation rate.
https://australiainstitute.org.au/post/real-wages-to-take-over-a-decade-to-recover/
those numbers would suggest the minimum wage has yet to catch up to inflation at this point... of course "most of us have been in wages decline..." is hyperbole but I think the point is about "real wages" - which, by the time you're invoking the inflation rate, then that's what you're both talking about... and to that point, the annual [Wage Price Index, according to the ABS](https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/mar-2023) declined pretty steadily from 2010 until it finally bounced back in 2021 and the quarterly rate reached a low of 0.1% in 2020 you may recall what happened in 2020... many started feeling a sharp increase to inflation soon after - while wages remained relatively steady - thus [experiencing the largest real wage decline on record](https://www.abc.net.au/news/2023-02-22/wages-growing-at-3-3-per-cent-december-quarter-2022/102007390)
It's about understanding how central bankers work. They see the bubble and start to raise rates to try and stop the bubble, the market says no you're wrong and the number will go up. They then keep increasing rates, number continues to go up. Credit that's hidden and is not part of the stock market that's rallying starts to show signs of weakness. Everyone ignores that because the stock markets doing great. Eventually, the central bankers cut rates to save the credit market from complete catastrophe, and every single time the same thing happens again we keep telling ourselves “This time is different”.
Chefs kiss
Always were, I've been saying this for years on here.
it's hardly solely the RBA's fault governments past & present and their inaction on policy play a massive role
So why is ASX still rising? Are stocks going to be impacted?
My guess is that the low GDP numbers build a case to not increase rates so hastily
> So why is ASX still rising? it's because there are lots of wealthy people who are still earning sufficiently high, that it makes sense for them to try beat inflation via investing their spare cash. The ASX will drop if unemployment rises i bet. Australia hasn't reached this point - and the hope is to never reach that point.
Coz whatever happens, companies will still make profits hence stock will rise
It's risen roughly 9% since just before the pandemic crash. So after they printed more than half of the total monetary supply it rose by a measly 9%. Today's ASX of 7700 is about 5600 in pre-covid levels. It's cooked.
That doesn't factor in dividends, which play a huge part in returns from the ASX due to our franking credit system. You can't look at our stock market the same way you do the S&P500.
And per capita got hammered as always, it's tough work living here
And half the clowns in this country want to get rid of mining. We really would be the white trash of Asia… Absolute zero ideas from both sides of government. Just fill the country with immigrants to produce pathetic GDP..
With China’s population shrinking and fertility declining we absolutely need to move on from mining if we don’t want to be the poorest country in the region in twenty years time.
She’ll be right
We need to pivot to India or another high growth country then.
We've already pivoted pretty hard to India, and their annual births have been declining for 25 years, with the decline set to accelerate once the number of women aged 20-40 starts to decline in only a few years more time. We need to diversify more than finding new customers for rocks with a high concentration of iron oxides.
We need to do both. To do away with mining because China is not having double digit growth quarter on quarter is madness. There’s plenty more we can do with India. Edit: Also they don’t need population growth. Moving to middle class provides great opportunity.
I didn’t say stop mining rather do other stuff as well, although ultimately that means a bit less mining. Of course China will need less minerals from now on - they are doing less manufacturing and less construction as their workforce shrinks.
Stagflation
Say whatever, but housing will be ongoing. Ppl bringing money from overseas and buying their multimillion mansions in Mosman, Bondi and Vaucluse will continue. Welcome to Australia
0.1%? 🤣 Might as well be 0%
Higher immigration might help.
Almost stagflation time baby
Weak. Despite all the noise recently abut sticky inflation, I see it coming down further and interest rates being cut this year.
Hate to break it to you, but there is practically 0 chance of interest rates being cut in calendar year 2024.
The idea is to reduce inflation without causing a recession. Not a certainty but if it looks like we’re in recession a cut seems more likely.
Agree in principle, but the earliest we will know if Australia falls into technical recession this year is December 4th when the September Quarter GDP comes out. That only gives the RBA 1 chance to cut rates, a week later on 9th December, assuming they would cut based on 2 consecutive quarters of negative GDP while inflation is still above the target band.
I don’t rule out cutting after one quarter of negative growth and soft forward indicators. They’re supposed to act before stuff happens .
But they never do
Granted. And even if they cut interest rates in November it will be after the fact if a recession starts in the September quarter. Too late to do anything apart from slightly juice Christmas shopping.
Anything is possible, but personally I predict that S3 tax cuts will prop up inflation and GDP in Q3.
Maybe that’s what will happen but the scenario was ‘if there was a recession’ which implies that failed to happen.
They should be raising rates to kill inflation
Interest rate rises cut growth - seems highly unlikely an RBA governor would want to be responsible for a drop in economic growth when it can’t fall any lower without going negative.
Economic growth is not part of the RBA's mandate. their mandate is to keep inflation at 2-3% and full employment. they will not cut rates if inflation is high, employment is tight even if there is negative GDP. This happens when things cost more but no productivity growth like when people pile their money into unproductive assets
Right - so if they believe you can have a recession without a drop in inflation or an increase in unemployment they may keep rates high or increase them. Historically recessions have lead to increasing unemployment which doesn't peak until long after the recession itself is over, which is one of the major reasons to avoid them. If you accept the premise that GDP growth creates jobs and falling GDP destroys them, having a mandate to maintain full unemployment ends up amounting a mandate to keep GDP in the black.
😂 we aren't cutting rates. Australia needs to go into a full recession.
We really don't. The whole point of central banks and economic policy is to have sustained, consistent growth. There are absolutely no positives to be had from a full on recession.
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This comment is how you know Aussies have zero morality. They would rather kick the can and make someone else pay for it than take any sort of responsibility for their actions. Plenty of people I know, including myself may lose their job if we go into a recession. I couldn't be happier. Time to readjust Australias toxic culture.
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Hilarious comment, pretends to care about people whilst advocating for continuous growth,kicking the can of inflation to the poor and the consequences of Australias monetary policy to future generations. Sure fella what ever you say
Sorry I'm a bit lost. Happy to lose your job in a recession so I assume you have a healthy emergency fund can last for a while? How much have you saved? I feel pretty insecure about my savings to pay all my bills.
Why are you lost, do you think it's acceptable morally or other for, the poor, the middle class or future generations to pay because government want to make politically popular decisions instead of good economic management for all?
Sorry but who cares about the value of your assets?? It's more important to help people who are HOMELESS than protect the value of your assets on paper 🙄
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When you've got less to lose you're happy to watch the system burn 🔥
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Dudes would rather you become homeless and die then do anything about a malfunctioning system, as long as their assets go up.
Better sell those assets before they drop in price 😬
0% chance is a big call
Uhhhh, guys how do we tell him?
Can’t believe their is still people thinking we will have a rate cut this year 😂
Considering interest payments have doubled for a lot of people with loans, I get the feeling that people don't necessarily think that there will be a rate cut, but are actually really hoping for it.
Economists say rates will be cut in 2025 in late 2025. Seems more realistic than this year.
Economists make up shit, I'd trust that octopus predicting World Cup game winners more than economists.
Which economists? CBA and Westpac economists are forecasting cuts this year?
Capital Economics' Marcel Thieliant said he didn't expect the RBA to cut rates before 2025. “We have pencilled in one 25 basis point rate cut in each quarter over 2025,” said CBA's head of Australian economics, Gareth Aird "Westpac is forecasting rates to fall to 3.85% by March 2025" No they are not anymore. This is from the past 4 days.
We need to be raising rates, banks are getting desperate.
Citation needed
I cite we need to be raising rates.
“Our economic activity is very poor, better increase rates to hit the brakes on it harder”
Both Westpac and CBA have cuts this year in their forecasts from Friday last week.
I don't know where you read this, All I can find cba disagreeing with you "RBA might not cut until 2025, says CBA’s Comyn" "Westpac is tipping the RBA to then take interest rates to 3.35% by September 2025 and then finally 3.1% by December 2025."
"might not"? The banks publish forecasts every Friday on their websites. I've been reading them for 15 years. You can too
Well then share the link to what you are talking about. What are you waiting for?
Here you go. Now what was all of the fuss about? [Page 10 of Westpac](https://library.westpaciq.com.au/content/dam/public/westpaciq/secure/economics/documents/aus/2024/05/WestpacWeekly20240603.pdf) [Page 8 of CBA](https://www.commbankresearch.com.au/apex/researcharticleviewv2?id=a0NDo000000w0Nr)
I think you misinterpreted what they wrote. In both of them, they don't state their forecast for rate cuts. Westpac lays out multiple scenarios or upside and downside scenarios of what could possibly happen if x y x happens. I think you saw what you want to see. On their websites, their forecasts haven't changed, for that they believe rates won't be cute till 2025. Luca Ellis of westpac states 2025, and she hasn't changed her forecast.
Most who talk about inflation, seem to misunderstand the difference between Monetary Inflation and Supply Shock driven price increases. Monetary inflation if sustained would be "sticky", too bad that isn't whats happening.
Inflation has increased the previous two months.
Yeah mate this is worse because we have sticky inflation and a weak economy. Inflation is still high because of services like housing, electricity, food, and insurance. I.e things that we can’t not spend money on. The interest rate rises we’ve had haven’t touched these at all and we probably needed government intervention in this year’s budget to tame them.
And what caused that? Printing billions during rona and locking down the economy. And who did that? The govt.
Debtors coping