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Trump Era 2025-2029 : Stock and Economic Comment

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Jeezus it costs us $1.50 to post a letter.
 
Don't get me started about tradespeople in Australia, compentacey based training by outside organisations that get paid on the number of people they pass does not mean they're making tradespeople.

Importing immigrants for cheap labour has been Australia's trick since after WWII, it's nothing new here.

I've been saying forever that people should live within their means, but the lure of fancy gyprock homes and bright brand new cars seems to be the prevalence of living it up in Australia. Whoever's got the biggest F250 and multilevel home with 10 spars wins, all care of debt from Australian banks.

The flaws of capitalism are starting to show. Where to next?
 
We don't live in a true capitalism, it is a corporatocracy.
 
The dreadful part about all this is that these people, if they are over 18, have a vote. They get fined if they don't do so.

No wonder the country is so buggered.

gg
 
The question is, what's the alternative?

In 2022-23 Australia's total exports were $688.074 billion according to DFAT (Department of Foreign Affairs and Trade). Of that:

$236.221 billion or 34.3% were fossil fuels of some sort (mostly coal and natural gas).

$127.422 billion or 18.5% was iron ore.

The rest is primarily other commodities either minerals or agriculture.

If we look at what's kept Australia away from the US' position then it comes down to fossil fuels and iron ore. That's it - so long as demand for fossil fuels and iron ore continues to rise, and Australia can continue to scale up production, we'll probably do OK.

Now now confident are you of that working out?

Myself? Well I think the writing's on the wall, big time, that it's not going to work out.

In the US context the argument for manufacturing is simply that the US has an existing large trade deficit and relatively limited options to turn it around. That is, the US does not have the option to do it through mining or agriculture alone, although they will likely make some contribution, and also doesn't seem likely to achieve it through services given the US already dominates many areas there. That leaves manufacturing and consuming less, and realistically there'll be some of both.

In the Australian context the argument's about the future, foreseeing that mining will plausibly contract, and implicit in that is acknowledgement that we'd be starting from a very low base in building up a manufacturing industry so it'd take a generation to achieve. That being so, it needs to start before it comes to the crunch.

As I see it what Trump's effectively achieved is bringing that forward. By adding in a clear issue of geopolitical risk in trade, along with making it abundantly clear that selling a few key minerals to a very small number of customers is fraught, it's forcing that discussion to be had sooner than it would otherwise have been in other Western countries.

As for wages etc well manufacturing's never going to pay the sorts of wages that senior executives, celebrities and the like receive that's a given. It's not bad though, what remains of existing industry has no trouble finding people keen to work there simply because it beats the actual alternatives in practice. Nobody's going to drop their high salary professional job to go and work in a factory, but it sure beats low level service jobs. It also has the huge bonus that it's an actual permanent job as an employee - banks are far more willing to lend to someone on the payroll in industry than they are to someone who sells things online or drives Uber for a living simply due to that consistency.

Back to my point - politics aside, what's the actual alternative economically? If not manufacturing of some sort (including refining, smelting etc) then what's the way forward for the US, Australia or the West in general?
 
Are the wheels starting to fall off The Trumpet's band wagon now, as more and more people wake up to the fact that he not the King of the USA or the Divine ruler of the World.
His popularity is certainly on a sliding, slippery slope at present, and there is no apparent reason why it would improve, given his no sense utterances or recent times.
 
Absolutely spot on, but how many actually care, my guess, not many going by the forum.

At least the reality will hit sooner rather than later, the longer it is left, the harder it is to dig your way out.

This next term of Government may be very enlightening for all.
 
Not sure they would be able to loan money for a home, that type of wage is barely existing in life type of wage.

Say you're on $28/hour, 58K/ year, 49K after tax, take out rent (520 x 52 weeks 27K) = 22k

Leaves you with roughly $423/ week - shopping $179 = $244

Say we have a cheap car and don't drive much. We'll half the average car running costs to ($200/ week) . 244-200 = 44

$44 left to pay for water and eletricity, yay!



 
Living the dream
 

Bringing manufacturing back to the West is the same as bringing poverty back - unless there's going to be some sort of deflationary "reset"....
 
Well here is a true blue Aussie, who bags the hell out of anything and everything, says it as he sees it, no holds barred sort of bloke.

Check out some of his youtube vehicle reviews, if you want to check out how down the line sort of bloke he is.

He isn't everyone's cup of tea, but worth a view, if you have nothing else to do.

 
Following on from the last post above: "Made in China, the facts".

October 2010

Call to foster local solar panel makers

Australian solar panel makers are calling for industry protection to slow down a flood of cheap panels being manufactured in China, as the NSW government reviews its solar tariff scheme.
www.smh.com.au

Australian solar panel makers are calling for industry protection to slow down a flood of cheap panels being manufactured in China, as the NSW government reviews its solar tariff scheme.
The scheme fuelled a massive boost in rooftop panel installation when it was announced in January. Over 30,000 households signed up to receive 60 cents per kilowatt hour of electricity they fed back into the power grid - or four times the market rate.
The tariff was suspended by the state government after it surpassed its 50-megawatt capacity in August, well ahead of schedule, though people who had already signed up are guaranteed future payments.
But the Australian Manufacturing Workers Union is urging a two-tier system. Households installing panels made in Australia should receive the 60 cents rate and those putting in cheaper, imported panels should receive 50 cents, it says.
''A lot of the research and the product development happens in Australia but because there haven't been sufficient price signals here, most of the manufacturing has ended up overseas,'' said the union's state secretary, Tim Ayres.

''We have got a chance to get in at the start of a major new growth industry, and we have the smarts to make it work if the government signals that it will support local manufacturers.''
The union will also campaign to have the scheme broadened to cover commercial and industrial users of solar power.
''Then you also have to look at schools - they are open only during the day and they could get major benefits from the tariff,'' Mr Ayres said.
The main beneficiary of the union's plan would be SilexSolar, a subsidiary of a nuclear energy research company, which bought a photovoltaic manufacturing plant at Homebush from BP Solar last year, after BP decided to source its panels from China.
The factory turns out less than 100 megawatts worth of panels a year, though that still makes it the largest in the southern hemisphere.

Submissions to the government's review into its solar bonus scheme, which closed this week, mostly call for it to be extended beyond the current cut-off date of 2017, to give big installers longer to pay off their investments.
The NSW Opposition also wants businesses included in any future tariff and warned that the generous 60-cent rate and the short, seven-year lifespan of the scheme risked creating a boom-and-bust cycle.
Mark Diesendorf, of the institute of environmental studies at the University of NSW, suggested a tariff of 40 cents a kilowatt hour, over a longer period, would provide the industry with better incentives for steady growth.
The NSW scheme was the most generous in the nation, and comparable to similar bonuses in Europe, which led to huge industry growth there.
But electricity production from solar panels in Australia shows that the technology remains embryonic. According to the most recent data from the Australian PV Association,at the end of last year solar panels generated 184 megawatts of power nationwide - fulfilling only about 0.2 per cent of the nation's total energy needs.

The NSW Energy Minister, Paul Lynch, will consider the submissions before a review is tabled at the end of the next session of Parliament. The Auditor-General will undertake a separate review early next year. Mr Lynch has pledged that any changes will not be applied retrospectively to people who already have panels.
Correction
This story should have said NSW's solar tariff scheme is continuing while being reviewed by the government.
 
Most of it comes from China, even some of the European stuff. A friend of mine toured the BMW factory in Germany, and on one of the factory lines were blank cast aluminium ingots from China being final machined into cylinder heads.
 
Should be able to live well and feed the hordes on that monumental total after all has been taken in one form or another.
 
sptrawler said:
The deflationary reset, could well be increasing the labour pool, while not increasing the GDP ?
Click to expand...
Yeah, but it will drop the house prices somewhat. You tend to see more businesses innovate during recessions, also.

When there was talk about China becoming a superpower years ago, I was sitting on a park bench with a friend, talking about how aggressive China was. This old Irish bloke politely introduced himself, asked to sit down next to us and started talking about how he moved to Australia after the war and said it was the best years of his life. He said it's what Australia needed; there was work everywhere. Not saying we need war, but some type of recession might be the only way forward.
 
A fair point for low end manufacturing jobs, but then the alternative for the same workers is low end service jobs that aren't any better. That is they might pay much the same per hour, but then you find out it's not actually 38 hours a week but it's something less than that. Or it's casual employment. Or it's purely based on actual sales either as commission or because you're paid per km driven, delivery made, customer served, etc.

What manufacturing does do however is create a pathway at least for some into higher level employment. Eg go in as something basic, manual labour basically, and there's your opportunity to convince the right people you've got what it takes to do a trade apprenticeship. Once you've got that, well then you're worth a lot more working in that factory, and it also opens doors to employment elsewhere.

Personally well I can immediately think of examples of people I know or have worked with. One started out working in electronics manufacturing some decades ago. Long story short they ended up not only becoming an engineer, but were in charge of their last workplace and also hold patents in their own name too.

Another that comes to mind isn't manufacturing but it's near enough. Turned up as a contract cleaner at a power station, and to clarify that's just normal cleaning of the office, lunchroom, toilets and so on it's nothing specialised or technical. Last I knew they were still working at the same power station - it's just that they're now a qualified technician, a permanent employee of the company that owns it (as distinct from being a contractor).

And so on.

There's also the flow-on economic effects. Personally I don't work in manufacturing, but I've ultimately been paid by more than one manufacturer via my actual employer at the time. And that was paid overtime too, so I wasn't complaining. I'm certainly not the only one in that situation - you wouldn't have to ask too many people in Hobart before you found someone who's gained economically from Incat, the zinc works, whatever ANM has been renamed to these days or Cadbury at some time in their lives. Even if they've never been on the payroll, there's an awful lot who've worked somewhere that did work as a contractor, that supplied something, etc. Same in other cities where there's industry, men in particular you won't have to look too hard to find someone who's made money out of it somehow even if indirectly.

In all of this as I see it, it comes down to what alternatives actually are available both in terms of employment and in terms of addressing "external" issues such as the balance of payments, supply security and so on.

What I don't follow how it would continue forever is a model where China (and other Asian countries) buy ores and fuels from Australia to produce goods which are sold to US consumers who as a whole can't really afford them. Whether it's currency debasement, borrowing, selling off assets or whatever, ultimately the US is living beyond its means and at some point that must surely become a crisis. In doing so that doesn't just kill manufacturing in China etc, it also cuts their need for Australian ores and fuels.

Same would then apply to Australia. If we start running big trade deficits, as we would if mining falters, then at some point that's got to end surely? There must surely be a limit somewhere to how much we can borrow, print the currency or sell off assets before the proverbial hits the fan. I mean the China, Thailand, Singapore, South Korea etc etc aren't going to just supply us forever out of the goodness of their heart, they're going to want something of tangible value in return.

The way I'm seeing it, this isn't a debate about whether manufacturing (or anything else) will improve life in the West but rather, it's that the present situation seems totally unsustainable. That being so, discussion of manufacturing isn't comparing it to the present but rather, it's comparing it to alternatives none of which are to carry on business as usual.

An analogy would be someone saying working doesn't sound anywhere near as much fun as going on holidays and partying, so why would they even consider working? True, generally work isn't fun, but it becomes a very different debate once it's accepted the inheritance isn't going to last and the banks won't lend without an income. Once you accept that point, once you accept that it's a job or it's outright poverty, that there is no option to continue living the high life, then all of a sudden getting a job becomes highly desirable.

As I see it, Trump's just brought all this forward. He's laid it bare what the situation is, rather than waiting for it to implode but it always was going to happen one way or another.

My expectation is we're going to go through the full cycle of grief, that being denial, anger, bargaining, depression and acceptance in that order and that however long anyone expects that to take, it'll take far longer to play out.
 
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