Real Economics here, your one and only source into the world of Australian Economics.

Did someone happen to mention a two speed economy? Retail sales in Australia are shocking and it be frank it is surprising to see the amount of shops still open given the horrid conditions. The best thing that you can do right would be to buy local and support the Australian retail industry in its crippled state. Although WA is booming is it great news given the turbulent nature visible over the past four years? xoxo Real Economics.

Source: TD Securities

Real Economics here, your one and only source into the world of Australian Economics.

Demand factors affecting External Stability:

Disposable Incomes:

When disposable incomes rise, consumption increases as people have more money to spend on their wants. This grows the demand for imports, since there will not be enough goods and services available in Australia. This increases the CAD due to increased debit transactions.

Interest Rates:

When the RBA sets high interest rates this means that it is more expensive to gain access to funds. This results in decreasing consumption and investment (therefore Aggregate Demand) and the Australian CAD should fall as there will be less demand for imports.

Business Confidence:

Increased business confidence attracts greater investment from overseas. As businesses are more optimistic about the future they tend to purchase more overseas capital, increase the Australian CAD.

Consumer Confidence:

When people are confident in the Australian economy they will tend to purchase more imports, increasing the CAD. This is because at times of extremely high consumer confidence the economy is near its productive capacity and the spill over causes an increase in spending on overseas imports. In these times more of the Australian Dollar (AUD) may be placed on the Foreign Exchange market causing a depreciation in the AUD. Therefore if increased consumer confidence causes increased consumption as well as depreciation of the AUD, it is evident that it creates increased external stability.

Overseas Activity:

As we know from earlier this year greater economic activity in overseas countries such as China causes a greater amount of exports in Australia. This increases the amount of demand for the AUD of the Foreign Exchange market and as a result causes the AUD to appreciate. Increased exports also help to improve our CAD as there are more credit transactions.

xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

At around 12:45pm today share prices in Bando Industries dipped, the first time since the company went public almost a week ago. The cause behind the minor fall in price was the announcement by Ritchie Holdings, that he and his firm had launched a new blog, due to the immense pressure placed upon them by the “new kid of the block”.

By the close of trade stocks for Bando Industries had risen back up and finished the day with a modest 1.42% rise in price. The rise was due to a press release from the company stating that more time and effort would be placed into their already booming blog.

CEO Martin Bando stated that “the unprecedented move by Ritchie Holdings to move to a new hosting site had not been forecasted”. Bando continued in his press release to say that “although there are two players now, Bando Industries still holds a complete monopoly on the so called blogosphere”.

The Ritchie Holdings IPO which occurred yesterday has been dubbed by many economists as a “failure”. Data from today shows that it has been one of recent history’s worst initial public offerings and the only dispute is which is worse, Facebook or Ritchie Holdings? xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

Tonight on Q and A David Marr said that Australia is a "miracle" economy. Perhaps he is right and Australia is in a strong economic position, definitely aided by our powerhouse mining and minerals sector. On the other hand there are many more indicators that point towards the other view that Australia is sitting on the edge of an economic cliff. Retail figures prove that other sectors of the economy are sinking lower and lower by the day, although we may see a change in these figures as the Australian dollar depreciates.

Do you think that Australia is in the dire situation we are lead to believe, or should we be grateful that our economy is still afloat even though coming so close to sinking by the way side?

Yet another Labor policy shambles. 

In other news that has made a prior minor appearance on Real Economics, the Australian Labor Party is again in trouble with their announcement of letting Gina Rinehart import 1700 offshore workers to be employed in the Pilbara region of WA. It seems that the ALP is facing a torrent of decisions which have turned around and shot them in the foot. Do you think that labour will have any chance at the polls next year, and if they do, will it be with Julia Gillard as their leader? xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

http://www.abc.net.au/news/2012-05-27/greek-crisis-sees-new-wave-of-migrants/4035548

 The above article from The ABC speaks about a recent influx of Greek immigrants into northern Australia. Many of these Greeks who lost it all back home are making the most of the strong labour conditions in Australia's top end. Do you think we should encourage this growth which is aiding people who want and need to start a new life, or do these jobs belong to the unemployed of New South Wales and Victoria (forget Tasmania). xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

Did someone mention a two speed economy? Well here is the data that proves such a statement. If you can imagine this data on the map of Australia you would see a line straight through the middle of the country, with the northern part booming, and the southern states appearing to be almost in a recession. At this rate Ritchie will be out of a job before long. xoxo Real Economics.

Source: ANZ

Real Economics here, your one and only source into the world of Australian Economics.

Where did all the money go? 

The above link is to an interactive article which tries to answer that fabled question. Also check out the video for a lighter look on the European situation from the infamous Clarke and Dawe. xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

The above chart is of the unemployment rate in Europe, as well as some individual European countries. The data tells as that broadly speaking, labour conditions and living standards are still on the down slope, although there is a glimmer of hope in Finland, one of the countries hit hardest in the Global Financial Crisis (GFC). The same cannot be said for other nations, especially Greece and Spain.

With Greece sitting at just under 22 per cent unemployment and Spain right on 24 per cent, both rates appear to be growing at a considerable pace. Alarming as this graph is, it does not show the youth unemployment rate, which in Spain is a mind-boggling 50 per cent!

At this time it should be noted that although Real Economics is an unbiased and impartial report, it is hard to remain positive when trying to foresee the future of the European economy, not to mention the Global economy. xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

The following link is to an article about the recent slump in the Australian Dollar. Check it out here.

Due to uncertainty in Europe the AUD reached a six month low on Wednesday and is currently sitting at around $USD 0.975.  Do you think that the Australian Dollar will continue to fall agaisnt the Green Back as the conditions in Europe will surely worsen? If so, how low will we see the Australian Dollar go? xoxo Real Economics.

Above is an interesting graph depicting the price of Copper over the past year and a bit. Copper is a great indicator of production, as it is used to make almost all electrical goods. Do you think the dip we are seeing now will continue and is it an accurate representation of the economic climate ahead? xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

It appears someone in the Ritchie household has soiled themselves, and it isn't little baby Eli. One does not normally open their email account to be faced with hate mail from a disgruntled rival, but alas, these are no ordinary circumstances. An email from Mr Ben Ritchie read:

"Can’t get my post is unauthorised according to your half-baked, backyard dodgy blog… so can you post my message for me?(see below

“I'm emboldened and pleased by such self-assuredness..but know this, Ritchie is not one to rest on his laurels, he is listening to the people and rest assured Bando inc., the new Blog is coming and it's going to 'blow you're collective minds'...”

Regards

Mr Ritchie"

This blatant disregard for my pure intentions to create a blog for the study and education of economics is offensive, distasteful and outright rude. Some say the best way to fight fire is with fire. However in this situation it is not the case. I am getting back to business, economic business. So stay tuned for a new post coming up soon.

xoxo Real Economics.

Real Economics here, your one and only source into the world of Australian Economics.

Ladies and Gentlemen, prepare yourselves for a new generation of Economics blogging. Brace yourselves as you are launched into the real issues of Australian and International Economics, receiving a balanced, comprehensive and yet easy to understand view on what is happening near and a far. Unlike "other" Economics blogs, Real Economics will provide you with the information you need, when you need it.

So tell your friends, family and associates there is a new voice in town. xoxo Real Economics.