71–80 of 85 posts
As far as I know "China" does not buy things. Their government, maybe. I'd like to know if a Chinese government entity or connected company was truly involved in this. If not, the reporter is speaking carelessly...
Honestly this kind of article annoys me. It's split across 5 pages (more page views anyone?) and meanders through largely meaningless anecdotes without ever really getting to the point. The whole stream of anecdotes style of journalism is one I abhor. It's lazy, can easily be abused (you can use anecdotes to prove anything) and is often just cheap theatre to try and humanize something otherwise without substance.
The stories are not used as supporting evidence, references or as facts to build an overall conclusion to some new idea - but rather as infotainment, where the anecdotes are the whole point of the story and there is no real firm conclusion or over-arching theme that is proven.
The anecdotes are easy to digest and repeat, which helps not smart people sound smart when they tell the same stories to a group of people.
It's pretty interesting to see how intertwined China is with Australia. If you ever want to short China, your best bet is to target Australia which already has a bit of a property bubble, mining companies that are dependent on Chinese demand, and a currency that is buoyed by commodity prices. If China is indeed a bubble (at least in the medium-term) Australia is going to experience a world of hurt.
If China is indeed a bubble (at least in the medium-term) Australia is going to experience a world of hurt. Yes, but... Australian is a commodity exporter. If China is a bubble, then yes, Australia will be hurt unless another country (US/India/Japan/Korea) picks up demand. Also, it's not a property bubble when there are less houses than people who want them. Because the population growth rate in Australia is (compara…
It is quite simply a myth that there is a housing shortage in Australia.
This idea has been conceived and perpetuated by vested interests in the property market in Australia, particularly the Housing Industry Association (HIA). A recent article does a good job of exposing this:"Housing industry's missing persons report pure fiction" http://is.gd/eXZT5
It's not the first time this kind of tactic has been applied either: in the lead up to the property crashes of the US and UK the press ran numerous stories about housing shortages. These quickly turned to stories of housing gluts after the bubble popped.
Look to the Australian census data of 2001 and 2006 and you'll see we've been building at an increased rate, and have an increasing number of empty houses on the books (around 800 000 in 2006).
A contrarian site gathers a bunch of this information here: http://bubblepedia.net.au/tiki-index.php?page=HousingShortag...
Earlier quoted context omitted.
I mostly agree with this. While I don't think we should increase mining profit taxes, I do think some of the mineral wealth should be locked away into a sovereign wealth fund - the type that can't be gotten at by sticky fingered politicians of any persuasion. The wealth fund could be used for apolitical purposes, like education funding (scholarships?), national dual lane freeway construction, large-scale water projec…
Actually wasn't the it called mining 'super' tax becuase it was to fund superannuation? I know there was to be some increase in funding but I'm actually not 100% sure because the govt did such a poor job of selling it. Anyway I think this may be one of those cases where the XX cents we typically get back from each dollar the govt taxes could be worth it to slow the party down.
Hah! No. It was a "super profits" tax because it did not kick in unless a project was making a rate of return above 5 or 6 percent or so. So it only taxes "bonanza" profits and has no effect on companies that are making a "normal" rate of return.
As for superannuation - there was some sleight of hand as well. The increased super was to be paid by companies. This was then to be partially (but not fully) offset by dropping the company tax rate, which in turn was funded by the super profits tax. So yes, they were linked, but not nearly as directly as they wanted you to believe.
Earlier quoted context omitted.
Do you realistically expect the US, Japan, or Korea to somehow fill the gap if China suddenly drops its demand for Australian commodities? India might pick up some of the slack, but I would bet against it. Household debt / disposable income in Australia is 157% versus 133% for the US shortly before the financial crisis. That level of debt combined with ever increasing home prices should create a pretty volatile situa…
Do you realistically expect the US, Japan, or Korea to somehow fill the gap if China suddenly drops its demand for Australian commodities? Probably not, but it depends. If you think the "China bubble" is because of Chinese domestic demand (ie, construction in China) then it will be hard to replace. If you think it is because of Chinese exports then it's possible another country could substitute. Personally I reject t…
"Debunking the Australian Housing Shortage" http://www.unconventionaleconomist.com/2010/05/debunking-aus...
The claim Australia has a housing shortage is not backed up by any decent data (only by very weak / spurious data provided by the property industry itself), and represents a continuing effort by the property industry to explain away all the signs that clearly indicate Australia is in the midst of a massive asset bubble.
The geopolitics are interesting, of course, but this was really interesting to me: He now oversees a test project of driverless Komatsu trucks that cart out 300 tons at a time, moving 80,000 tons over two 12-hour shifts. When the drilling is good, he says, they can shift 120,000 tons in 24 hours. Without drivers, the trucks are more reliable, with radar sensors stopping them from crashing. They roll 24 hours a day.
some drill rigs are semiautonomous, with GPS. The control systems were priced around $120k the last time I looked about 10 years ago. Any HN'ers want to disrupt this? I know some drillers out this way.
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I'm in the same boat as you - the high AUD is killing my profitability - 30% revenue fall in 2 years. However, I don't condone this type of government action just to make my life easier. Continued foreign investment in high risk mining activities is good for the country, and this was going to stop it. If anything was to be done then the state-based mining royalties should have had some component to adjust with the pr…
> I don't condone this type of government action just to make my life easier It is certainly easy to have one's opinions shaped by personal circumstances. But do you really think that Australia's long term future will be best served by relying on our minerals rather than our minds? It's like the economy is telling us 'this information economy stuff is all rather nice but the best thing you could be doing now is figur…
I do think Australias long term future is best served by minerals at this point. There's no way of knowing what the future holds, best to bank as much now while the price is good. Yes, it holds some risk over the geopolitical situation, but you can't get rid of that.
Digging up minerals and selling them now puts Australia to work. drives down the Current Account deficit, allows us all to enjoy a higher standard of living. Put simply, Australia has comparative advantage in minerals mining so we should maximise this to the benefit of all. Unemployment is 5% because of the mining, not despite the mining.
It's not an either/or question on mining/information technology. There's plenty of room for both. Australia can lead the world in minerals, and mineral extraction technology. Australia has already built up world class mining companies that now invest internationally. Long may that continue - with a stable political climate, well developed capital markets and a home-grown skills and technology base, there's no reason why Australian miners can't be major players in worldwide resource extraction for centuries to come, even if the iron ore in the Pilbara runs out. The world will never stop mining - never has, never will.
Earlier quoted context omitted.
Do you realistically expect the US, Japan, or Korea to somehow fill the gap if China suddenly drops its demand for Australian commodities? Probably not, but it depends. If you think the "China bubble" is because of Chinese domestic demand (ie, construction in China) then it will be hard to replace. If you think it is because of Chinese exports then it's possible another country could substitute. Personally I reject t…
Unlike the US we don't have a housing bubble, because of our increasing population. "Debunking the Australian Housing Shortage" http://www.unconventionaleconomist.com/2010/05/debunking-aus... The claim Australia has a housing shortage is not backed up by any decent data (only by very weak / spurious data provided by the property industry itself), and represents a continuing effort by the property industry to explain…
Earlier quoted context omitted.
I mostly agree with this. While I don't think we should increase mining profit taxes, I do think some of the mineral wealth should be locked away into a sovereign wealth fund - the type that can't be gotten at by sticky fingered politicians of any persuasion. The wealth fund could be used for apolitical purposes, like education funding (scholarships?), national dual lane freeway construction, large-scale water projec…
Actually wasn't the it called mining 'super' tax becuase it was to fund superannuation? I know there was to be some increase in funding but I'm actually not 100% sure because the govt did such a poor job of selling it. Anyway I think this may be one of those cases where the XX cents we typically get back from each dollar the govt taxes could be worth it to slow the party down.
Super Profits is a Marxist term (don't know if Marx coined it, or it just became part of the canon) to reflect anything above a 'reasonable' rate of return. In this case it was set at the government bond rate. Which makes you question why any rational investor would invest money into a highly risky mining venture when they coudl get the same returns from government bonds. I suspect they thought they could kick off a nasty class war - which people seem to have forgotten now that Swan was muzzled by Gillard and Rudd deposed. But at the time Swan and Rudd were talking about 'evil foreign rich miners'. But it backfired with some good PR from the mining companies, and a higher level of awareness among the Australian people when someone is being deliberately obtuse.
It was sleight of hand to link super profits tax with superannuation. In reality the two have nothing to do with each other because employers pay for employee superannuation out of their bottom line. The only superannuation the government pays is for public service employees. The reason they did a poor job in selling it was because if you actually looked at the details, the tax and the superannuation actually had nothing to do with each other. Lindsay Tanner actually quoted as much before changing his tune to the party line.
>slow the party down.
Imagine how much you would be upset if they decided to start taxing you extra because they thought you were doing too well. It's the ultimate definition of unfair. The miners struggled for decades - have a period of prosperity and are whacked with extra taxes. That is not only unfair, it raises sovereign risk and ultimately reduces foreign investment. You don't improve the economy by knobbling your best performer.