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Australia’s Economy Surges Ahead!

June 6, 2012

The nation’s economy is surging ahead with new GDP figures surpassing expectations and confirming that the Australian economy is now growing a rate not seen since before the GFC.

ABS figures show the economy grew by a solid 1.3% in the quarter – faster than even the most optimistic of market forecasts of about 0.6%, and on an annual basis, by 4.3% in the 12 months to March, again much faster than 3.3% market forecasts.

As Bernard Keane at Crikey notes, the figures are well above trend:

“Remember, this is historical data — it’s for the first three months to the end of March. It covers a period when retail sales grew better than many forecasts had expected, but came despite a surge in the current account deficit that cut GDP growth by 0.5% (it was a negative 0.3% in the December quarter). “

“It also came despite the weakening in commodity prices (such as iron ore), the sharp fall in mining company profits in the quarter and weaker demand in some sectors of the domestic economy. The annual rate is well above the trend rate for the economy of 3.25%. Trend GDP growth in the year to March was 3.6%.”

The ABS also revised its figures for all of 2011 from 2.3% to 2.5%. The December quarter figure of 0.4% was lifted to 0.6% growth and September was boosted to 1% from the revised 0.8% in the December accounts. The June quarter remained unchanged at 1.4%. The March, 2011 quarter which saw the impact of the Queensland floods, was changed to a negative 0.5%, compared to the previous 0.9% and the original minus 1.2%.

The GDP figures effectively trash the claims of economic doomsayers most notably Joe Hockey and Tony Abbott who insist that the economy is struggling.

Joe Hockey fronted to the media in response to the figures declaring that while the figures couldn’t be ignored, it was the sign of a “bad government.”  It was an embarrassing attempt to portray black as white.

As Katharine Murphy at Fairfax notes, good economic news is just that. Good.

Nevertheless, poor old Joe was “forced to flick the default personality switch from ”generally avuncular” to ”prophet of doom.”

“Hockey flailed at a loss, sinking deeper the more he spun in his own rhetorical quicksand.”

According to Joe, “It was just The Government that was Bad. A shambles actually. And our success proved it — Australia could be, or perhaps it was already, paradise lost, or in danger of being lost, or … something.”

“Good economic data evidenced, somehow, the deficiency and incompetence of the Gillard Government. ”Imagine how well our country could do if we had a good government,” Mr Hockey blustered, truly heroic in his quest for badness and sadness.”

And in the face of these remarkable growth figures Joe somehow concluded that Wayne Swan was the ”scariest thing in Australia.”

Oh how we laughed and laughed…

 

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Majority of Australians want Carbon Tax Scrapped.

June 5, 2012

A shocking new poll has found that a majority of Australians now oppose putting a price on carbon and support Coalition plans to scrap the carbon tax.

Despite the promise of government “famliy assistance” cash-handouts, sixty-three per cent of Australians now say they’re against the introduction of a fixed price on carbon, leading to an emissions trading scheme, and 57 per cent say they’re in favour of coalition plans to scrap the tax altogether.

The findings represent a dramatic turnaround in public sentiment with regards to climate change. In 2007 over 60 per cent of Australians supported government moves to take action on climate change however support has waned ever since Kevin Rudd failed to garner multi-lateral support at the failed Copenhagen Summit.

The new survey of 1005 Australian adults also indicated a majority support temporary skilled migration to fill labour shortages.

The Gillard government imploded last week after it was revealed that Immigration Minister Chris Bowen agreed to deal allowing multi-billionaire Gina Rinehart’s Hancock Prospecting to import some 1700 overseas workers for her Roy Hill iron ore mine in Western Australia.

The move angered Unions who cited thousands of local job losses in recent months.

According to the survey, eighty-one per cent were against foreign companies buying Australian farmland, while 56 per cent thought the government was allowing too much Chinese investment in Australia.

 

 

Today in Finance: with Special Guest Star – Alan Kohler!

June 4, 2012

Presenting!

****AN EXCLUSIVE FARNHAM REPORT EXCLUSIVE FINANCE REPORT POST-BUDGET ANALYSIS FORECAST PREDICTION BULLETIN***

With special guest star – everyone’s cuddly bearer of all things financial – Alan Kohler..!

And now it’s over to Alan…

“Well it’s been a rough trot today in finance. Things were always going to start off gloomy with the Australian Share Market off to an abysmal start following offshore leads.

But fuck me if things didn’t get out of hand.  The ASX fell below the crucial 4000 points mark.  Why it is crucial remains a mystery, it is a but a number, but perhaps a psychologically crucial one for people who like nice even numbers.

By the time markets closed today some $23 billion was wiped off the Australian share market with things falling to a six-month low.  But it’s not just investors on the share market who lose.  Almost everyone’s superannuation fund will also take a hit.

But it’s not all bad news.  Mortgage owners will be in for a reprieve, with the RBA almost certainly likely to cut interest rates when it meets tomorrow.

Here’s a handy chart I prepared earlier.

Meanwhile the Federal Treasurer Wayne Swan remains unfazed, saying earlier today that the share market carnage is evidence of Australia’s “resilient economy.”

And that’s today in finance.”

 

Everything is Going to Hell in a Basket!

June 4, 2012
  • Everyone hates Julia Gillard!
  • Everyone hates Tony Abbott!
  • Sharemarkets are collapsing around world!
  • The people are revolting!
  • It’s all turning to custard in a major way!

***AN EXCLUSIVE EXCLUSIVE EXCLUSIVE***

According to reports, Australia’s most-hated Prime Minister Julia Gillard will “absolutely” lead Labor to the next election according to her “fellow cabinet ministers” despite Labor equalling its lowest-ever results in today’s Fairfax/Nielsen poll.

Today’s poll puts Labor’s primary vote at 26 per cent, while two party preferred, the Coalition comprehensively leads Labor by 57 per cent to 43 per cent.

If there was a uniform swing, this would give the Coalition some 31 extra seats.

This morning, Treasurer Wayne Swan dismissed the poll results.

“The opinion polls will come, week to week, month to month,” Mr Swan told ABC radio. “I don’t get focused on the opinion polls at all.”

Based on current polling, Mr Swan’s seat of Lilley in Brisbane would be under serious threat at the next election. But the Treasurer said that he was “not at all” fazed by the prospect of losing his seat.

Mr Swan said Ms Gillard would “absolutely” be leading Labor to the next election – scheduled for next year.

Attorney-General Nicola Roxon also said Labor would “absolutely” stick with Ms Gillard.

Ms Roxon told Macquarie Radio that it was frustrating the polls did not reflect Ms Gillard’s ability.

“I really work very closely with Julia. She’s incredibly strong, incredibly decent,” Ms Roxon said.

“It’s one of those occasions where some of the public opinion and commentary is so disconnected with the actual experience of Julia face-to-face that it’s frustrating for us.”

Today’s poll results also brought some bad news for Opposition Leader Tony Abbott.

The Nielsen poll finds that former leader and communications spokesman Malcolm Turnbull is preferred as Coalition leader by 61 per cent of voters, compared with 34 per cent for Mr Abbott.

Mr Abbott’s personal approval also fell 5 points to 39 per cent, while his disapproval rose 5 points to 57 per cent.

Coalition MP Steven Ciobo explained that Mr Abbott’s personal ratings were low because he was “doing his job.”

Mr Ciobo said that Mr Abbott had “so much material to work with” in attacking the government.

“There’s no doubt that one of the consequences of that is that you’re sometimes viewed as being negative,” he told Sky News.

Meanwhile,  the “whole world” is facing a worldwide economic meltdown as the Australian Sharemarket plunges in early trading following negative leads from overseas.

At 10.11am AEST, the benchmark S&P/ASX200 index was down 1.75 per cent to 3992.8, while the broader All Ordinaries index was down 1.76 per cent to 4044.6.

It is the first time since November that the S&P/ASX200 has been below 4000. It reached 3984.3 on November 25.

Meanwhile, in a sign that even traditional hero’s are buckling under all this tremendous pressure, once golden boy swimming champion Kieran Perkins has trashed yet another apartment after an all night drinking binge session involving five bottles of wine!

In other news, Queen Elizabeth has sailed down the Thames in giant floating turd designed to commemorate this momentous occasion where her “subjects” were effectively sailed down the river.

Oh, the joy!

 

Rostrum: Zombie Apocalypse Edition!

June 1, 2012

Life.

What is it and who does it think it is?   This week has been a weird and whacky world of politics and grim headlines from around the globe.

Who can you trust to bring you the most reliable news and topical stories none of which are ever sensationalised a bit too much or even made up at all?   The Farnham Report of course.

The world already provides enough unbelievable stories of its own.  Take for example the “Miami Zombie” who decided to make a meal of some homeless guy’s face in Florida earlier this week.  Apparently he was “high” on baking soda of all things.  Who knew?

HE’S NOT A ZOMBIE, HE’S MY SON” claims distressed mum.

Not I’m not saying that it’s the start of the Zombie Apocalypse or anything, but when some dude chows down another guy’s noggin and doesn’t react to being shot, perhaps we ought to consider it.

It pays to BE PREPARED.

Check out the grisly photos here (or don’t if you’re a bit squeamish)…

And the even more grisly one here…

And if that wasn’t enough gore for one week, now there’s some Canadian gay porn star who’s the subject of a world-wide man hunt after murdering and dismembering another guy and sending bits of him to different people in the post.

I mean to say, who are these people…??

A video reportedly circulating online shows a man repeatedly stab another man with an ice pick and dismembering him, as a song from the soundtrack of the film “American Psycho” plays in the background.

“It’s a video of the murder,” police told the Daily Globe and Mail. The newspaper also reported that the footage showed acts of cannibalism..

Meanwhile, back home a Sydney woman – Jian Chen – has pleaded guilty to manslaughter after attempting to “castrate” her husband she discovered Mr Chen had a new girlfriend.

According to a statement of facts before the court, police said she had used sleeping pills to spike the soup she gave her former partner at her North Ryde home on February 9.

Once Mr Chen was asleep, Mrs Chen allegedly bound his hands and feet and stabbed him a number of times in the neck and groin, before cutting off his penis and scrotum.

It doesn’t bear thinking about really..

And if that’s not enough for one week, apparently there’s a new AIDS like disease that’s already infected 8 million people and is spread through mosquito bites and it’s going to KILL US ALL!

On that note, have a lovely weekend..

 

 

On a Scale of One to Ten

June 1, 2012

Just how rooted is Europe?

The following article is from the Wall Street Journal

As European officials race to quell fears that Greece may exit the euro, many companies doing business in the troubled country are preparing for the worst.

Most executives, analysts and others agree on one thing: the impact of a Greek withdrawal from the euro zone is impossible to predict. That’s why multinational companies are rehearsing for any number of contingencies. They range from a paralysis in cross-border payments to a civil breakdown in Greece to a broader breakup of Europe’s common currency.

Retrieving their cash is among the companies’ gravest concerns. If Greece were to revert to its former currency, many companies fear that any euros left there would be converted into less-valuable drachmas. Should that happen, Greece is widely expected to impose capital controls to keep the remaining cash in the country.

Heineken said it is moving spare cash out of Greece and the euro zone overall and into currencies such as the U.S. dollar and British pound.

The measures are part of the Dutch brewer’s normal cash-management routine, but “we’re doing it with higher frequency, and we’re a little more focused,” a company spokesman said. “We make sure we don’t leave too much cash in [Greece], to limit our exposure.”

Other companies, including liquor giant Diageo and drug maker GlaxoSmithKline have said they are taking similar precautions.

Several Greek companies, meanwhile, have drawn on credit lines from foreign or local banks, fearing they could lose access to them should Greece revert to the drachma and introduce capital controls, said an official of one bank that does business there. He declined to identify any of the companies or banks involved.

European tour operator TUI and UK based electronics retailer Dixons Retail are among those that have plans to shift or protect customers and assets in the event of social unrest in Greece.

In some cases they are relying on methods tried and tested in North Africa during last year’s Arab Spring uprisings. TUI, for instance, said it could shift customers planning to go to Greece to other destinations, if necessary.

Consulting firm Roland Berger, based in Germany, said it was advising corporate clients to take steps such as introducing clauses in new contracts that stipulate what currency or exchange rate will be used, should Greece leave the euro.

In Greece, and increasingly Spain, companies are insisting on bigger upfront payments for services and products, sometimes of as much as 50%, or reducing payment periods to 15 days from 30. Others are paring back sales operations in those countries, in part to boost their standing with banks.

A Greek exit from the euro zone “would be a complete mess, and people shouldn’t underestimate that,” said Benedict James, a partner at U.K. law firm Linklaters. “A trickle of work we were doing on this has turned into a major flow the last few weeks.” Much of that work has centered on business contracts, and which ones, for example, could be terminated if Greece returned to the drachma.

Business sentiment in Europe has worsened sharply in recent weeks.

One of the biggest declines has been in Germany. Until recently, German companies had largely shrugged off the debt crises in Greece and Spain as robust orders from China and other fast-growing emerging markets more than offset lackluster demand from Southern Europe.

Another sign of anxiety came earlier this week from two of the world’s biggest trade-credit insurers, who make sure exporters get paid even if their foreign customer defaults. Allianz  Euler Hermes and Coface, a unit of French investment bank Natixis said they would suspend coverage of goods shipped to Greece because of the mounting risk of being unable to recoup payments from importers there.

Rates for such coverage have surged, said Euler Hermes spokeswomanBettina Sattler, though none of the insurers would cite specific numbers. Given the high stakes and uncertainty surrounding a Greek election set for June 17, “we couldn’t price it anymore,” Ms. Sattler said.

French retail giant Carrefour is consolidating its network of stores in Greece into fewer and bigger outlets to cope with plummeting sales there.

It also is stocking more discount store-brand products and fewer brand-name goods from food and consumer-product giants like Nestlé and Procter & Gamble Co as Greeks tighten their belts.

Trumpf, one of the world’s largest makers of laser machine-tools, said that should a worsening crisis cause its European sales to collapse, it is ready to revive measures it used during the global economic crisis of 2008-2009.

“Unfortunately, that wasn’t too long ago,” said Harald Völker, the German manufacturer’s chief financial officer. “But it means we can implement them fairly quickly again.”

Those steps include moving to more flexible payment and delivery arrangements with suppliers and a system in which its employees would work fewer days but get paid the same.

Employees would repay the hours by working overtime once demand recovered.

In the wake of the previous crisis, Trumpf cut more than €100 million ($124 million) in costs, bolstered reserves and secured three-year credit lines—enough to make sure it could endure a 50% plunge in sales, if necessary, Mr. Völker said.

Even if Greece ultimately stays in the euro zone, the pullback by companies and banks operating there is bound to take its toll on the already-beleaguered economy, which shrank by 6.2% in the first quarter.

Bankers say the uncertainty caused by last month’s elections has largely paralyzed business activity in Greece, with companies postponing investment decisions until the dust settles and as cash drains out of the country, bleeding its economy.

“There’s a deep liquidity squeeze in the country right now,” said George Zois, Greek equities broker at investment bank Exotix.

Following May 6 elections, which yielded a strong showing for a radical leftist party that has vowed not to comply with the terms of Greece’s international bailout, the country postponed a sweeping privatization program that was intended to raise much-needed funds for the government and bring foreign investment into the country.

Such ominous signs don’t seem to worry some companies. While 50% of German companies surveyed in a recent Roland Berger poll said they thought a Greek exit from the euro was likely, only 20% said they had prepared contingency measures.

“There are still many companies that aren’t so prepared,” said Max Falckenberg, a partner at the international consulting firm. “Companies have got enough on their plates just dealing with daily business.”

Other companies are weighing what-ifs in the event of a broader breakup of the 17-nation euro zone. Officials at Airbus parent European Aeronautic Defence & Space Co which is based in France and Germany, said a return to national currencies would force it to rethink everything from where to expand to how it picks suppliers and sets wages.

“If we go back, the German currency would probably be stronger than the others, which raises issues in the long term about where we locate operations,” said an EADS spokesman.

“There’s a potential for tensions within the group because wage levels would be different” from country to country.

EADS said Thursday that it is studying the feasibility of creating an in-house bank to protect its own access to credit and that of its customers amid the euro crisis. Among other benefits, having an in-house bank would allow the company to tap the European Central Bank for cheap funds, as auto maker PSA Peugeot-Citroën SA did recently through its in-house bank.

At least one company sees potential opportunity in the chaos. Dixons Chief Executive Sebastian James has been widely quoted in the British press as saying that should dire predictions pan out in Greece, it could represent an opportunity for the electronics retailer to gain market share from weaker rivals.

 

It’s Official: Old People Smell Bad.

May 31, 2012

It’s something I’ve been convinced of for years, old people smell funny and now there’s the scientific evidence to prove it.

Aiming to settle a lingering debate about the existence of so-called ‘old people smell,’ a study just released confirms that, yes, there is a stench distinctly characteristic to the elderly and it’s actually quite unpleasant.

Researchers at the “Monell Chemical Senses Center” in Philadelphia (No, I’m not making this up), collected “body odour” samples from at least 12 people in three age groups — young (20-30), middle-age (45-55), and old-age (75-95) — by having each individual sleep for five nights in a row wearing T-shirts concealed with “underarm pads.”

A group of 41 young evaluators were then asked to “sniff the odor samples” and identify which samples came from older people.

They were also asked to rate the “intensity” and “unpleasantness” of each odor and estimate the donor’s age.

Using their noses, participants were able to distinguish between the three age categories, according to the findings published in the journal PLoS ONE.

The evaluators in the study found the body odors from the old-age group were in fact less intense and less unpleasant than the scent of middle-aged and young individuals.

‘Elderly people have a discernible underarm odor that younger people consider to be fairly neutral and not very unpleasant,’ said senior author Johan Lundstrom.

‘This was surprising given the popular conception of old age odor as disagreeable. However, it is possible that other sources of body odors, such as skin or breath, may have different qualities.’

The researchers theorized that age-related smells in humans might serve to transmit important social information, as they do for non-human animals.

‘Similar to other animals, humans can extract signals from body odors that allow us to identify biological age, avoid sick individuals, pick a suitable partner, and distinguish kin from non-kin,’ Lundstrom said in a statement.

However, it remains a mystery as to why old people smell like an old bit of urinated on old carpet that’s been locked up in some musty old wardrobe for half a century.