Australian Economy?

[Ganoderma]

I am curious what are peoples opinions about australias economy....expecially its growth for 2007? it seems it has great potential but i never see it doing a lot of trade (relative to others). I　ａｓｓｕｍｅ　ｄｒｏｕｇｈｔｓ　put a big dent on exports, but what about other things? basically i am wondering what ar your thoughts on where your dollar is going? up/down?

 

it seems like it is starting to peek now...you think so? But so is the euro. Canadian just seems steady, its my safe bet.

 

Honestly i am looking to invest a large sum into a foreign currency, and would liek a stable one that is on the increase. I have decided on Australian dollar, canadian dollar or the Euro. i understand the canadian one fully, and the euro seems like it can only get better in time, but australia i am unsure...

 

what are your thoughts?

[Jay-qu]

Australia's resources are booming, China has been spending a lot of money here for their upcoming Olympics. Theres a good chance that the spending will stop after 2008 - so I think you may be right that we are at a peak atm.. but im no economist, its just fun to theorise ;)

[jackson33]

first, let me suggest you do NOT put all your eggs in any one basket. large sums into any currency is speculation at best. in the past few days the Indian Rupee as increased 10-12 %, but there markets have decreased nearly the same as product and services are automatically increased in cost that 10-12%. also keep in mind you would be betting on one and against another, in any monetary investment.

 

the Australian dollar is probably as stable as any, at this moment. you mentioned the Canadian$, Euro and i will include the British pound are all moving higher against the US dollars. the trend has been over many months and reflected in the price of gold or silver and other metals. with the stability of your own dollar, this should be a consideration.

 

personally, i used a metals mutual fund opposed to money and tripled my investments in 4 years. this however is a near completed movement in my opinion and have recently sold.

 

there are *option markets* that deal on line. several i know advertise through Google or Yahoo, which has the best investment site. these usually will take small amounts or even allow a practice system, where nothing can be lost. money, oil, metals, commodities and much more available for hedging against or for anything. very complicated and most in this area trade 24 hours a day 7-365 a year and play on new investors.

[Ganoderma]

good info thanks! i personally think that metals are kind of at the top of their game (particualrily precious metals). i was stupid and chose "world growth package" 6 years ago instead of gold...was a flip the coin decision...oops.

 

i don't want to put it into metal anymore as teh prices are rather high. my first 2 choices were India and China. cant invest much in china here easily (im not investing HUGE amounts of money to make the hassle worth it) and india is also a little hard to do here.

 

I was considering the GBP, but i cant see them doing much. perhaps i am wrong. The UAD/CDN/EU like you said are kind of stable. I don't know if its so much they are going up or USD is going down, probably both. i am thinking that the euro can gain largely by new coutnries and, perhaps, easier trade restrictions meaning more trade. thats the thought process on that one anyway. canada i jsut see as having lots of natural resources therefor always staying at least "comfortable".

 

australia, i get mixed info on.

[ErlyRisa]

i would be skeptical about all -->

 

my forecasts...

 

EU - very risky -> although property in for example Romania a great idea right now (get in quick, the mafia is buying up everything), as for the value of thier currency, I don't see it going up... rather I am guessing a hell of a plummet with Britain, and the Northern states taking the brunt of the impact, while the joining partners slowly re-curb the exubarance that the EU is currently having.

 

AU - another bit of a risk , I don't think it's the drought - Autralia is currently struggling with 'left leaning' policy which is driving business and advancement away from the country, banks are loaning like it's Xmas everyday here -- expect a big thump in the next 5yrs.

 

--> I would rather that U look for an interest in a certain feild of creative thinking .eg. Nano Tech --> thier are many great oppourtunities to further advancement with your investement, but again the risk can be very high. (tip: invest in 'fanless CPU technology, in ur own coutry)

 

---You said U had an interest in metals -- I think that this is still going to go up another time (unless china/india either start mining themselves on larger scales, or society changes enough for thier enthusiasm to curb (there will be a flatlining of the economic growth of these states sooner than later - when the crash will occur is anyones guess)

 

---I see ur from Taiwan --I think investing in your own country would be advantageuous, there are a multitude of technically advanced companies, just trying to get off the ground thier --choose a couple that you think would have a good 'niche' in the market, eg. CNC machinery manufacture - you guys are very good at it, while the rest of the world cannot be bothered with it (except Japan, and soon China - yes the Europeans and Americans do the same, but thier machinery is even more 'niche' .)

 

---Consider Brazil --> they are booming at the moment, and I don't think the US will let them stop booming (too much to lose) , consider investing in upstart company thier (if thier are any yet)... I think thier currency exchange will stay wuite constant for a time to come, but as the EU and the US (and the west on the whole) go down the big dipp coming soon, smaller countries will retain thier value throughout the drop.

 

hope my opinion helps with your nest egg.

[Boerseun]

Even the world's best economists are agreed that short term foreign currency predictions are akin to reading tea leaves and chincken entrials. There is no reliable way to forecast forex movements in day-to-day and week-to-week movements, regardless of what the portfolio managers will have you believe - they are, after all, simply after their commission, which they'll get whether you turn a profit or a loss.

 

Long term is another story, and much more reliable than short term. And in that sense, I'd buy into the Euro. The international oil traders are buying and selling more oil in Europe using Euros since the Euro oil market opened a couple of years ago. The US dollar oil trading is falling on a daily basis, contributing (together with the US debt) to a constantly falling US dollar. The world will be buying, selling and burning oil for many years to come, and the Euro is simply a safer mechanism in view of the traders, because it's much more stable than the dollar. This trust invested by them will in turn drive the Euro ever upwards for many more years to come. The Euro is underpinned by a stable economy and a wealthy consumer class, and is soon becoming the currency of choice in off-shore deals.

 

Australia, in my opinion, is too dependent on resources. The demand *should* be constant (and rising) in the future, but this is mainly driven by Chinese demand through expansion and growth. You might have your own opinion of this, but as far as I'm concerned, the Chinese phenomenon is artificial, driven by a artificially low currency, and even the Chinese government is beginning to realise this. They are actively trying to *cool* their economy down to prevent an eventual meltdown. China's growth replaced by a big slump has been preceded in the East by quite a few of these "Tigers" growing beyond all reasonableness and then hitting a wall, falling into a big depression difficult to come out of. Japan being a case in point, although their governmental systems are hardly comparable. Be that as it may, I'm very skeptical of the East, or any economy largely driven by Eastern demand (such as Australia's resource-driven economy). I might be completely wrong, but what the hell - that's my gut feel.

 

I'd go Europe, because their interests are well-balanced between the East and the West.

 

But also, keep in mind that certain resources seem to be the best bet in uncertain times. Whenever oil rises, war breaks out, anything strange happens, gold shoots through the roof. For thousands of years, this has been the case. People are, in essence, simply a bunch of crows. If they loose trust in money, give'em something shiny. Gold is something you can see. So, if you're completely unsure of the economy, gold might not be a bad idea at all.

If you do, however, want to trade in currencies, you can always pick a loser and trade short on it for as long as it drops. You can make bucks both ways.

[Ganoderma]

good thoughts, thanks ;) as far as investing in taiwan, frankly i am not as optomistic as you are. more and more people are moving their companies to china, and this economy here in taiwan is slowly going down, and has been for 10 years. true there are some strong businesses here, but i dont know, the whle china thing scares me away a bit. i may loose my house when war breaks out, but i want some money to take back to canada (hence foreign currency trading).

 

it seems that perhaps australia is a little shaky, so i think i will steer clear, for now.

 

Gold. well it often seems good, but look how high it is right now....its not cheap! can it really go up much more before the world starts bombing itself again? i am looking to trade for about 1 year and hopefully be able to purchase property, which to me is the only true valueable asset when it gets down to it.

 

i do agree with what is being said, break it up a bit. perhaps play a bit with this and that. we can now just recently buy chinese dollars, so i am thinking i may put a couple thousand into that as i am thinking their currency will go up soon as they seem to be working on (and with some pressure from outside countries it seems).

 

I ould liek to buy indian money, but that is not easy here.

 

So perhaps a good route may be try some in chinese $, Euro, and perhaps play a little gamble in a company.

 

Its a fun game, till you loose ;)

[ErlyRisa]

I don't think the world will allow the waking Dragon (china) run awry... ie I think U are still safe at home in Taiwan --the day China crosses borders is the day that the existing Giants (the co-alition of the willing) will be knocking on China's door.

 

-China is quite literally playing games at the moment, somewhat similarly (though more intelligently) to iran.

 

--Yeah, investment dollars are flocking to China like wild fire, so yeah I would (if I had the money) invest in European property, or even Brazilian property (although the governement of Brazil is hard to contend with, just because u boaght proerty don't outright mean that u own it)

 

-Gold -nah at 600US I don''t think it can clime any higher. , and China is playing games with the metals market - in many cases they aren't paying thier bills, inflating value and crashing it (steal).

 

I have a freind which currently gambling on Futures... are u a gambler?

 

--Banks seem to be doing pretty darn well, -they may still yet climb?

consider NAB ANZ etc of australia.

[Ganoderma]

i only gamble with what i can loose....i cant loose much ;)

 

banks always come out on top, as stupid as it may sound i try to stay away from them as much as possible. perhaps not logical, but i just dislike them.

 

I was looking into brazil and a little into venezuela. but like you said, i don't see a whole lot of insurance there...as far as property goes it needs to be property where i can live or rent. that leaves taiwan and canada open....and canada is peaking in property value right now. i am waiting for the next crash soon, in which i hope to buy then.

[ErlyRisa]

same here - bugger the banks.. if only everyone else thought along the same lines....

 

cut ur credit card, keep as much money as possible away from ur savings account, and make as little transactions as possible. --don't let the banks run the world for you --get on the stock market and keep ur money thier!!!

 

--shame I can't follow my own dogma.

 

---another thing... I hate property investors, even though it's one of the most valuable assets... the richest entities in the world are the Roman Church and the state - why? = property.

 

Property investors just end up driving up and inflating the value of land... here in Australia it has gotten to the piont where the current generation can no longer afford land/home . (Which happened in Eurpope a long time ago) --I can't wait for a crash, even though I own a home and am wanting to sell it, I would rather that the Australian dream be kept alive for future generations.

 

PS... buying property in Europe don't have to be all that difficult, I have freinds which all own property 'back home' (europe) . In most cases you have to learn the 'layout of the land' (mentality of the people' in the country you buy.)

eg. If you did buy in europe, be carefull not to tell the people in the area that it is a foregn owned building - it will be pillaged and burnt down. The best bet is empty land (but gathering rent is not an option), make sure it's in a spot where a Future macdonolds would be planning to buy and sell up. In the case where you actually purchase a building for lease, than the profit is probably too much the hassle and worry.

 

--Taiwan seems to be going pretty darn well... I don't see why you can't invest in your own country.... I am sure thier is somesort investment opp's thier. -as for Canada - > your back to square one, you may aswell invest in Australia... so in effect if you live in Canada part time, then US investments are still the best bet.

 

--Just remeber Taiwna is an Asset to the world --> it can't be left down trodden, it's only way is up (long term).

 

Tip: is anyone exporting French style cakes thier in Taiwan? - you could invest in a local company looking to export thier 'secret taiwnaese cakes to europe and the US? -or as a really good idea, why not start up your own cake company that exports affordable quality french cakes/sweets to Canada(marketing the taiwan label maybe a bit difficult, but their is the stisfatction of promoting your country!)?

[Ganoderma]

i shuld clarify that i only live here, i am canadian :eek: that and my chinese is pretty damned bad. this makes investing a little more complicated, but doable. I have looked into things here, but this cuntry is changing fast. for example they are introducing pensions and old age security type things. which i like. BUT this also means companies are are hiring/firing/closing/reopening to avoid paying employees. so small business canbe a bit unstable...that and the fact half the small businesses here are illegal to avoid extra costs/taxes.

 

I like the idea of openeing a new business but we own our own school and right now it is 8am to 10 pm so there is not too much time for new ventures (hence investing, no time required).

 

what you mentioned about people not taking kindly to foreign buildings. that is the sort of reason i prefer to oly buy property in taiwan or canada, here i can check it, canada family can. so its safe. this one i will need to do more research into.

 

no offense, i would rather invest in a bank than the US. :) hehe sorry :

 

i will start looking into "small" (still biggish, to avoid them closing for stupid reasons) businesses to invest in. i was thinking the fruit market may be good as the fruit here is of very high quality. unfortunatly that means high cost, so we shall see.

[Michaelangelica]

i would be skeptical about all -->

 

.

 

AU - another bit of a risk , I don't think it's the drought - Autralia is currently struggling with 'left leaning' policy which is driving business and advancement away from the country, banks are loaning like it's Xmas everyday here -- expect a big thump in the next 5yrs.

"left leaning" ? what are you? Hard right of Genghis Khan?

Australian government is fascist run by Old Bonsai ('little' Bush).

Banks may have been generous in the 80's but now they are as tight as the proverbial fishe's a*se

 

Singapore has to offer free land and 5 years 'no tax', to entice business away from Australia.

Where would you prefer to live?

In a Singapore high rise or near the beach in Oz?

 

Australia is the biggest mine in the world, gold, diamonds,coal, oil, iron, uranium-thorium (1/3 of worlds supply.) Old Growth Forests, enough gas to keep most of the word going for a long time. Plus a highly educated and motivated workforce.

Our biggest problem is getting "it" (stuff) out fast enough.

Off my coast are 70 ships waiting to fill up with coal from Newcastle.

 

Australia is a very stable government with a long tradition of democracy, corporate transparency, and fair play.

The present 3-4% growth is a function of our poor economic management. Politicians who are more concerned with their pensions than the future.

But that will probably change at the next election. (In about 6 months time)

 

The drought has been horrible but it looks like breaking soon.

However we are no longer dependent on rural exports.

 

If I has money to invest I would put it in BHP Bulliton (just check out what they own!) or Gold stocks

[ErlyRisa]

at 16% --of course they were generous --especially that they could forecast a quadrupiling of property value in the shortest period on the plant [exageration withheld]

 

---but who could afford it? --My house - under the recession we had to have: $120000 (which was only 70000 a year before) - I am still paying it off... I don't know how much I paid -> maybe 750000 by now... luckily today I only have 100thou to go.

 

--in the 80's the term 'equity mate' had not been coined - why,,, bank was not going to risk a single income earner with thier first house, with not even a smidgeon of the interst paid off (16%)...

 

today you can loan to the excess's of half a mill on dual income, and start up your equity game in under 5 years ... hey - what's that guys name that's on late night TV.... didn't he get a loan for the loan for loan, for the loan on the the second investment, on the loan of the loan of the loan ,with $200.00 in his pocket --> yeah, banks are giving it away mate. (alot more now than then,, that's why it's good business to set up a bank, eg. St George, eg. Home Loan Lender, eg. Harvey Norman ineterst free etc etc etc.

--Times have never been so good. -> maybe Latham could have done a better job, but I don't know, I don't vote.

[Michaelangelica]

Forbes puts BHP as number 96 in the world best performing coumpanies

Rank Company Country Industry Sales ($bil) Profits ($bil) Assets ($bil) Market Vaue ($bil)

97 BHP Billiton Australia/United Kingdom Materials 31.85 10.35 46.83 122.29

[Ganoderma]

there is no denying that australia has a good economy. the question is, wiil it go up much. i am thinking not now. stable yes. It seems that it is teh 3rd wrld that is going to be making the explosions. now we can purchase chinese $ here (very recently!) so i will be putting in about 2000 usd into that to play with at first.

 

taiwan dollar has been slowly but steadily going down for the last 10 years....so i am not in any hurry to keep taiwan dollars, i would at least liek to exchange them and put that in a bank account....at the very least.

 

i am still mulling over the euro. tempting, but one always has that little gremlin in them that says no.

[minna]

You might want to consider the inflation rate of the currency you want to invest in. There is really no benefit in investing in a growing dollar that has an even faster growing inflation rate.

For example China has a growing inflation rate, though it is not as high now as it was in 2004 due to central bank regulations. It will no doubt continue to increase due to its growing economy. Growing inflation leads to growing interest rates, which is another big factor to consider if you are planning to invest.

To actually make money in the foreign exchange market is quite tough. There are a lot of things to consider than just a growing value of the dollar. Make sure you know government policies quite well so you can make an informed decision.

 

As to Australia's economy, well I think Michaelangelica has gone through Australia's natural resources quite well :D. Though I disagree that a labour government will be able to push up Australian growth rates. BHP Billiton, Rio Tinto and other mining companies are riding China's (or you could say East-Asia's) economic boom. So investing in them in some aspects is like investing in China. If the Chinese (East-Asia's) economy continues to grow and demand resources then BHP Billiton will be able to continue to generate profit. But I have to say BHP's prices are quite high already and I don't know if there will be a big jump in prices in the future. Unless Australia decides to export large quantities of Uranium :P. (Which might not be all that unlikely once we run out of oil. Although renewable energy might be a better and more politically friendly alternative).

But BHP is not Australia's only company, and we are not solely relying on BHP for our economic growth. While we are abundant in natural resources we also have a growing service industry.

Australia has a developed economy, you're not going to expect it to have rapid growth like East-Asian countries. But it is more 'predictable' and probably less risky and prone to change.

Making correct investment in those economies will generate higher returns, but keep in mind that you're subject to higher risks, more unpredictability, and in many cases very fickle government policies (ie. investing in property in China).

All I can really say is good luck and do your research before you invest in anything.