The pound!

CLAPTON

Engeroosi wrote: »

Clapton I would appreciate less of the "idiot" please, this is a friendly forum for discussion

I would appreciate a little sense of humour please, this is a friendly forum for discussion

Loughton_Monkey

CLAPTON wrote: »

I would appreciate a little sense of humour please, this is a firendly forum for discussion

Absolutely spot on.

Now, will everyone on these boards who is NOT an idiot, please press the 'Thanks' button now.

NOT YOU, CLAPTON!

Generali

pqrdef wrote: »

Ultimately it goes with the balance of payments. Australia has mineral wealth that other countries want to buy. Just what Britain has that other countries want to buy is a lot less clear. Unless we can sell the belief that the world owes us a living - we've got loads of that.

Australia does make a lot of money selling dirt and rocks to foreigners. She also imports more by value than she exports.

lvader

Generali wrote: »

The Aussie won't stay as strong as it is forever. The pound's weakness could last a while though.

Don't count on it, it might eventually flatten out, but big changes like these don't usually go back to what they were.

Generali

lvader wrote: »

Don't count on it, it might eventually flatten out, but big changes like these don't usually go back to what they were.

Don't get me wrong, a strong Aussie is great for me. I bought an Aquascutum suit for AU$150 on my recent trip back to the homeland. 8 years ago it would have cost AU$1500 or more!

My belief is that the Aussie is strong because of the huge interest rate differential at present. In Aus I can easily get over 6% gross interest on my savings from a high street bank. In the UK you can probably get 3% if you hunt around a bit(?). That and the mining boom have attracted a lot of money into Australia. Neither will last indefinitely.

lvader

I believe that it has far more to do with the amount of commodites they export. High interest rates on their own don't count for much. It tracks the price of copper quite well.

Thrugelmir

Generali wrote: »

Australia does make a lot of money selling dirt and rocks to foreigners. She also imports more by value than she exports.

Gen, a friend of mine lives in Freshwater. She believes that Oz is now a 2 speed economy (mining exports and the rest). So that all is not as healthy as we believe over here. What's your gut instinct?

Generali

Thrugelmir wrote: »

Gen, a friend of mine lives in Freshwater. She believes that Oz is now a 2 speed economy (mining exports and the rest). So that all is not as healthy as we believe over here. What's your gut instinct?

Freshwater's not too far from me. It's a lovely spot.

I agree 100% with your friend FWIW.

It's widely reported in the papers but I think things are worse than many imagine. House sales are falling fast, retail sales are falling off a cliff. Then there's anecdotal stuff like the ease at which you can get a cab at midnight on a Friday, how quickly you can get served at a bar in the flashier downtown places.

You can see the desperation in the shops. I went into the bed department of a department store here last weekend and lay down on a random bed. It turned out to have a price tag of $1700 on it. 2 sales assistants came over and unprompted one said, "If you buy it today you can have it for $1000". I hadn't even asked for a discount!

People are clearly becoming more price sensitive. You have to queue for an hour to get into Costco, even during the week, and there is always a traffic jam outside the Markets (an Aussie phenomenon where wholesale markets like New Covent Garden become retail markets after 10am or something).

There are fewer jobs around in the private sector and the public sector is taking on fewer people and expecting those working for them to work harder. Voters want a surplus going into Government coffers; they are very wary of budget deficits.

Obviously this drop off is coming from a pretty high point so things aren't particularly bad. Also if things go horribly wrong in the world (which there is still a chance of IMHO) then there are worse places to be than a big empty country that is much more than self sufficient in food and which has abundant energy supplies (Australia is set to become the Saudi Arabia of gas).

DervProf

pqrdef wrote: »

Ultimately it goes with the balance of payments. Australia has mineral wealth that other countries want to buy. Just what Britain has that other countries want to buy is a lot less clear. Unless we can sell the belief that the world owes us a living - we've got loads of that.

What we need is higher house prices. I mean, the rest of the world must look on in slight envy that we have a property shortage and fairly strong private rental market. If we could only get some strong HPI back again, the country will be quids in.

Thrugelmir

DervProf wrote: »

I mean, the rest of the world must look on in slight envy that we have a property shortage and fairly strong private rental market.

I doubt that "they" are even aware or for that matter care. As too busy dealing with their own problems.