Over the past year our AUD has lost 21.5% vs the USD.
https://www.xe.com/currencycharts/?from=AUD&to=USD&view=1YWith the drought, the fires & now the Covid-19 we can expect a dramatic
reset of the stock market to reflect our impending recession. The lift over the
past few days is simply a dead cat bounce, IMO.
I walked along a cafe/resturant strip this evening of about 50-60 businesses and they were virtually empty.
One owner told me that he had already retrenched three quarters of his staff and he was relying on takeaways
now to pay the rent.
The residential hotels a few blocks away were in a similar position to the resturants and cafes ( virtually empty ) offering rooms at 60% discount!
The supermarkets seem to be the only ones benefiting at present.
The PM's announcement this PM virtually shut down pubs, clubs, resturants Cafes gyms and your normal discretionary
spend businesses. This will mean bankrupcy for many , devalue real estate and stun the economy.
The question is who will pay.? At present we have not had offers from the billionaires who have trippled their wealth since the GFC,
thanks to generous tax laws and we have had multinationals doubling their revenue in that period also and again treated very leintly
by the ATO:
https://www.xe.com/currencycharts/?from=AUD&to=USD&view=1YIts now time that the Government made these multinationals pony-up and pay their fair share of tax at a time when the country is in strife.
Someone will have to pay for the $180 Billion handout package announced yesterday and unless action is taken now, it will be the unfortunate PAYE
workers who will have to pay later. This is what happened in Ireland and other European countries post the GFC which did not hit us thanks to China bailing us out with its additional demand for our exports and the accompanying high export prices.
(Pssst...we're not sending our war ships up through the China Sea now)
This time will be different, IMO, because China has been gutted already by the virus and the US Tariffs and besides China will want to support its neighbours such as Mongolia, Russis etc.
Due to our obvious pro Trump stance on China, the Chinese will be very selective this time around when it comes to the supply of raw materials to
support its own economic recovery, IMO.
IMO doubling royalties on our Iron Ore & Coal should yield about $8 billion P/A extra State Government income which would just about pay the interest only on the current Government handouts. We are already paying about $20 billion interest on the rest.
Unlike 2008, we are already loaded with soverign, state, muni, personal & business debts. If we add he lot together we're in the hole for over $7 trillion; 4 times our GDP.
With massive unemployment imminent, real estate prices are bound to tumble more than 2008/2010 which will put some recent Gen Y home owners under water, IMO.
When all this blows by this increased Government spending will have to be paid and who better than those who control our valueable mineral resources !
PS: Gold at present seems to be the best preserver of wealth!
