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There was a rally to 2/3 approx of the initial bear, after the first claw, in the Great Depression.

 

Past isn't always future, the US is not going to crumble so easily. So, there is likely a rally, and some will serenade the rally in the mainstream media especially, and crow to the bears. But the facts are there. And there can be no escape by denial. Look at the "promisory notes" of debt - escalating past 7 trillion. Already it is surreal.

 

You guys, our friends from the US, our saviour in struggle, must see the crazy numbers. Already, the US debt, in dollar bills lined up end to end, extends from Earth to Saturn. The next phase seems to be the battle of the Fed for survival. I suggest, and I know I'll cop it for my views, but I will say it, which is.....our American friends should apply to come here to Australia ASAP. The stampede for the exit will otherwise overtake you.

Thanks for the invite but if I visit your great country that's all it's going to be, just a visit. Hope things get better for you.

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Thanks for the invite but if I visit your great country that's all it's going to be, just a visit. Hope things get better for you.

 

 

Thanks. Hope you do. I will be visiting the States late this year to meet my partner's father in Connecticut.

 

My point reflects the debasement of the USD or the default on debt. People migrate for many reasons, often in search of a better life (based on their personal values or necessity).

 

I see migration from the USA occurring from this catastrophe, with time. I see Australia as a good place to come. This may be sorely misguided.

 

Australia depends on the US for defence, but for trade our biggest partners are China and Japan. Our biggest exports are coal and iron, we are a net energy exporter and one of the biggest gold producing countries in the world (with little sovereign risk). Once China's infrastructure stimulus (funded by surplus) begins to work into actual projects, commodity and energy demand should rise.

 

This is a reason for a better outcome out of this global tumult for Australia, as well as the fact that our 4 main banks are now rated in the top 15 in the world.

 

An obstacle, in my view, is voting out this clueless fool of a prime minister we have, who may call an early election as I'm sure he sees the writing on the wall and wants to have his job secure before it hits the fan.

 

Also, our housing market is one of the most grossly overpriced, if not the most, in the world, thanks to past goverment policy.

 

This bubble will come down if our export market fails, and it should.

 

The biggest two other risks, firstly, a drop in immigration due to cost and bureaucracy, leading to runoff of skilled labour to other competitor countries and significantly, the education dollar, which is our 3rd major "export" (a means to residency in the majority of cases rather than the education itself - eg Indian engineers doing a cooking course or masters of accounting).

 

The other, the aftermath of credit contraction on the mortage lending market. No lending meas no buyers and prices must fall.

Again I regard that as a good and necessary thing, if unpopular.

 

I've rewritten part of this post due to a computer glitch.

Edited by breakfast
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  • 1 month later...

An obstacle, in my view, is voting out this clueless fool of a prime minister we have, who may call an early election as I'm sure he sees the writing on the wall and wants to have his job secure before it hits the fan.

 

 

I agree, this Clown needs to go NOW !! $950 ??? that will solve our ill's ???? Wow lets just print more money and hand it out at street corners.

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loosehead

It's only $900 now. The other $50 was redirected to the Murray River to get the package through the Senate.

 

The next election isn't due until 2011. Highly unlikely there will be an election before October 2010.

 

Housing has come down in price but a generous first home buyers scheme combined with low interest rates is propping up the bottom end of the market (below $500K). Despite all the doom and gloom we still only have 5% unemployment. Where I'm based in WA it's only 3.2%. A lot of people I know have never been better off which may help explain Rudd's high popularity rating.

Edited by loosehead
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The Aussie$$ is over 70 cents now. Hmmm, going more or less the way I predicted in December. Can't see a big hammer dropping on it.

 

:blink:

 

.

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Wirraway

Aussie $ now US$0.71.4 keep going

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breakfast
The Aussie$$ is over 70 cents now. Hmmm, going more or less the way I predicted in December. Can't see a big hammer dropping on it.

 

:blink:

 

.

 

 

Scianna's on the ball

 

I expected sometime soon a fall in the AUD, based on waning demand for commodities. Whilst the prices have plummetted, some are rising again, such as copper. The AUD is pretty much at its historic average I think, versus USD.

 

It seems hard to justify my earlier comments of a big fall in the AUD right now. My supposition underlying that view is that the USD is the reserve currency of the world and the US the biggest economy, as well as waning commodity demand.

 

Iron is still dirt cheap (our biggest export). Coal still dismal. But gold is holding its own so far.

 

There was an article in The Australian today, showing a trade surplus, thanks in no small part to the rise in the price of gold, one of Australia's more lucrative exports.

 

What happens if there is coordinated currency debasement of all the main fiats, to the AUD? The outcome of G20 should prove interesting to this question. An adoption of the SDR might lead to a drop in gold, though it seems unlikely to get universal agreement.

 

Gold, silver and oil may be big winners if all fiats are debased in synchrony. Aussies might like to look at AED oil (1/10 of its price from the heights of late 2007) or AWE - both are cashed up to the nines and have stacks of oil, gearing up the apparatus ready for the next leg up in oil.

 

As for the RBA, if they keep cutting rates could we lose our AAA status? Their brief is to keep inflation in the 2-3% band per annum. Time will tell.

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breakfast
The Aussie$$ is over 70 cents now. Hmmm, going more or less the way I predicted in December. Can't see a big hammer dropping on it.

 

:blink:

 

.

 

I might add, increasing public debt under Rudd and a profligate private debt to GDP ratio are potential hammer-like entities. If the banking sector took a big hit (eg mortgage defaults) that could exert a some pressure on the Aussie.

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I might add, increasing public debt under Rudd and a profligate private debt to GDP ratio are potential hammer-like entities. If the banking sector took a big hit (eg mortgage defaults) that could exert a some pressure on the Aussie.

 

 

Probably time to unload some Aussie$$ in gold sovereigns.

 

 

.

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loosehead

1 AUD=0.7154 USD

 

1 AUD=34.2478 PHP

 

Up again overnight. The $A swings on confidence about demand for our commodities. As confidence returns to the markets and the demand for our resources picks up the $A will rise. But any drop in confidence about the demand for resources and it drops very quickly. When the $A dropped below 30 pesos I had a bet with my mate for a dinner at the Marco Polo that it would be over 42 pesos by mid 2010.

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It would be great if the AUD will get up to 40 or higher loosehead! As it is now my personal opinion is the AFR will again drop interest rates to try to stimulate spending in the retail sector.

 

For those of us who basically rely on interest rates to generate our funds for living, it will be another hard hit.

 

People in Aust are not spending! Lowering rates any further will in no way encourage a massive spending spree.

 

KRudd and his gang are going about arse up - so what else is new with Aust politicians.

 

Let's see what the few months may bring - if no world event of major impact, we should expect the AUD to settle at a reasonable level against the Peso & others.

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People in Aust are not spending!

 

 

You hit it on the head. While our politicians are talking and printing paper (can't call it money anymore), consumers are not spending. The only people spending here in Canada right now are first time home buyers who are being lured into that by real estate agents who have had no bread for 6 months now.

 

Let's see where that leads.

 

.

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breakfast
You hit it on the head. While our politicians are talking and printing paper (can't call it money anymore), consumers are not spending. The only people spending here in Canada right now are first time home buyers who are being lured into that by real estate agents who have had no bread for 6 months now.

 

Let's see where that leads.

 

.

 

I'm not sure how the stats are presented in Oz. I'm spending just as I was last year. I don't need any more material goods. But my creature comfort spending is no different. We'll see in 6 months. I'm putting my excess $ in energy, it looks like a no brainer in years to come. Food too.

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I'm not sure how the stats are presented in Oz. I'm spending just as I was last year. I don't need any more material goods. But my creature comfort spending is no different. We'll see in 6 months. I'm putting my excess $ in energy, it looks like a no brainer in years to come. Food too.

 

Don't know when when but I am pretty sure that the energy and food markets (stocks, futures etc.) will soon be be regulated by the authorities.

 

Hence, I don't see the existence of regulated markets possible if things keep on going the way they do right now. With money worthless and NWO controlling everything, there is not much sense in owning paper assets.

 

.

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breakfast
Don't know when when but I am pretty sure that the energy and food markets (stocks, futures etc.) will soon be be regulated by the authorities.

 

Hence, I don't see the existence of regulated markets possible if things keep on going the way they do right now. With money worthless and NWO controlling everything, there is not much sense in owning paper assets.

 

.

 

Scary stuff. I am still in the camp that free markets win. To quote Bill Bonner "Capitalism doesn

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