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Australian Economic Analysis

The abs released a report on Construction today which showed the value of construction work completed fell in the Jun08 quarter by a SA -2.7%. Now surprising given the slowing economy however 1 quarter of data is not enough to see a trend. Listening to companies like LEI it seems there are still plenty of construction projects in the pipeline for the next 12 months.
 

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Strong numbers on private new capital expenditures released by the abs today showed a 5.7% increase from the previous quarter. In addition the expectations for 2008-09 were revised upwards to show a 26.2% increase on the same estimate for 2007-08.
 

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Private Sector Credit growth continued to slow in July rising 0.5% but still showing a healthy 11.2% year over year growth rate.
 

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Private Sector Credit growth continued to slow in July rising 0.5% but still showing a healthy 11.2% year over year growth rate.
Things are going bad Dhukka.

When's the time to buy?

Is it at the top, on the way down, or at the bottom?

Let us know the right time to get back in....

Would be of great benefit to us ASF'ers with some cash laying about.

Looking forward to some helpful advise....

 

Ahh poor old kennas, I can see you coming a mile away. But wait a minute, I think I have some useful advice for ya I read somewhere on here....oh yeah, the stockmarket always goes up over the long term, at some point, it will be time to buy!
 
Ahh poor old kennas, I can see you coming a mile away. But wait a minute, I think I have some useful advice for ya I read somewhere on here....oh yeah, the stockmarket always goes up over the long term, at some point, it will be time to buy!
LOL

Thanks!

Let's just hope there's a stockmarket left by the end of it all.

Whenever that is..

Sorry if there was a hint of sarcasm in that post. It was a bit late...
 
the Performance of Services of Index was released today showing the services sector has been in contraction mode for the 5th straight month. This month's readng was the lowest in the 5 and half year history of the index.
 

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Australian GDP figures for the June quarter were released today shoing that the economy grew 0.3% in the June quarter, the slowest since Decemeber 2004. The highlight for me was the first contraction in Household consumption since 1993.
 

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The Preformance of Construction Index released today showed a small improvement but it is still firmly in contraction mode for the 6th straight month. Highlights from the report:


 

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Thanks for the charts Dhukka the trends are obvious.....
 
I found this site useful, because it not only gives you the latest economic data, but also rates them in terms of importance. (which is useful for a noob like me)

http://www.dailyfx.com/calendar/

scroll down the page for more recently released figures
 
ANZ job advertisement data released today suggests a softening on the employment front going forward.
 

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Both the number and value of loans for owner occupied housing are now down -30% from their respective peaks in June 2007 according to the abs data released today. This will be the Spring selling season that never was.
 

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Retail Sales were up a tepid 0.1% in trend terms in July. It's important to note, that because of changes to the way retail sales are calculated (that is, they are using a smaller sample size) that the abs now considers the trend data to be a more accurate measure of month to mnth movements. From the abs

 

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All Catergories of Lending finance fell in July on a Seasonally adjusted basis. From their peaks, Housing finance is down -24.7%, Commercial Finance -35.5% and Personal Finance -9.1%
 

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This though, is really good news right Dhukka, the sooner we stop spending credit and saving the quicker we'll get this downturn over with and can out of recession? At least credit is not expanding.....
 
This though, is really good news right Dhukka, the sooner we stop spending credit and saving the quicker we'll get this downturn over with and can out of recession? At least credit is not expanding.....

It's good news, but remember we are coming off unsustainable high levels of credit. As you can see in the graph below on housing finance, we have only retraced to August 2005 levels.

The economy thrives on the extension of credit to businesses and households for growth, so clearly a contraction forces changes in habits of both businesses and households. The RBA of course was pleased to see this to reign in domestic demand however the fear for them is that it goes too far the other way.

If it does go too far the other way we'll see the RBA trying to reflate, just look at the US for a model of what to expect, monetary easing, fiscal stimulus and if it gets bad enough government intervention. That would not be good news because it will make the process more drawn out and protracted.
 

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This all seems to be pointing to a great buy opportunity shortly.

Or, how long does this slide go?

Is it a slippery dip to oblivian?

 
This all seems to be pointing to a great buy opportunity shortly.

Or, how long does this slide go?

Is it a slippery dip to oblivian?


I agree, I am seriously looking at buying a house closer towards the end of the year, hopefully interest rates will drop once, maybe twice before then which will help.

does this sound like a good plan?

are we heading for recession or already in one and just don't know it yet?
 
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