I think the RBA are a bunch of idiots and the institutions they allow to inflate the hell out everything dangerous, criminal and incredibly stealthy operators.
When I left Australia 7 years ago a carton a beer was $30 for 24 stubbies. I think I paid $65 a year ago last time I was back. That's 116% inflation or 16% a year. I bet they are $70 a carton by now.
In Germany, beer 7 years cost 60c a bottle or €14 a carton. You know what they cost 7 years later? €14 a carton. Food inflation is there in milk prices etc but it's about 3-4% a year. I was shocked when I went shopping at coles and could only fill a quarter of a trolley for $125. Food inflation? Gimme a break. Have wages in Australia risen by as much in the last 7 years? 16% a year?
As an ANZ investor I see the banks pulling the same gimmicks. Raising interest rates because of a higher funding costs! What a joke. It's not stopping them from opening 150 casinos in China for the Chinese to punt on currency moves. The French Banking industry could not believe the claim made by Aussie banks that funding costs were high. Rates in Europe are 1%! They are giving money away here. The US rates are even lower at 0.25% and the UK 0.5%. Banks are offering me 3% interest to buy a house.
So the RBA keeps rates high to fight mythical inflation and destroy the local Aussie economy by taxing homeowners are both ends. I wonder how much of the carbon tax on mining will go to funding innovation or improving Australia's value added chain and terms of trade. NOT 1 CENT! China on the other hand use their monopoly on precious metals to not on only mine the metals but dominate every step of the way through the value chain by producing magnets for example, phone parts etc etc from the metal they mine.
What does Australia do? Sell metals for $1-2000 per tonne and then buy back cars for $30000 plus each.
That money from the carbon tax should be solely used to prop up and develop Australian manufacturing. What's one thing we make that people buy overseas? Wine is about all I can think of or see.
Economic data just continues to worsen...
- New Vehicle Sales (MoM) (FEB) 0.0% (down 1.3%) - New Motor Vehicle Sales (YoY) (FEB) 1.7% (down 2.7%) - New home starts (FEB) -6.9% (was -5.8%) - Westpac Consumer confidence -5% (down from 4.2%) - Australia trade balance exports down -673 million from a +1300 million surplus - Employment -15000 - Unemployment 5.2 (up from 5.1%) - GDP down to 2.3 from 2.6% - current-account deficit rose by 2.6 billion - company operation profit down -6.5% - inventories up 1.4%
But hey who cares, let's keep the AUD high while the world lowers their currencies and gets a competitive edge!
KZL Price at posting:
16.5¢ Sentiment: Buy Disclosure: Held
