The Abbott Government

McLovin said:

Who told you that?

SQ is a listed company. And a profitable one at that. It is not an extension of the Singapore tourism authority. Just because it is majority government owned doesn't mean the profit motive has been chucked out the window, nor is there any credible evidence they are dumping capacity in Australia. This accusation of government support has been getting tossed around by unprofitable competitors for years (actually SQ complains that EK receives support too). SQ has more capacity running into Australia because it's not an end of line carrier like QF. It's the same reason CX can run 5 daily flights into Sydney and 4 into Melbourne. All that traffic is running back into a massive hub.

There is a huge market that involves getting people from Australia to Asia and Europe. SQ has been playing in that market for decades. QF decided to keep dropping services from Europe until all it offered passengers was London. Well that's fantastic, if you're going to London, otherwise they force their pax to transfer at probably one of the worst airports in Europe. If I'm not going to London, I'd much rather transfer at Schipol or Frankfurt.

I'll play Qantas CEO, and say that they could compete. But Joyce has run down the product so much because he thought everyone who flew Qantas was like the once a year punter who flies Deathstar from Sydney to Bali. Those crappy mattresses they offer in business class now are because they seats are falling apart. The hosties have to make people's beds now, which means on a long haul late night flight in a full business cabin it might be 30-40 minutes once you're in the air before you are offered a drink. That would never, ever happen on SQ/CX/EK etc. Qantas still believes it can charge a premium price but it has degraded its hard and soft product over the last few years.

ANZ has been shrinking not growing, that's why it's returning to profitability.

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Singapore has crony capitalism throughout the major companies. The head of Temasek is the wife of the PM and the way she has handled the SWF over the years she's been there has been woeful. You can blame some of the political instability in Thailand on the way they helped Thaksin try to avoid tax on his shincorp mobile sale.

Yes SQ is a well run airline, and the profit motive is still there, but you can't deny that when you have an overall view of the economics of extra capacity that a Government backed airline will not behave quite as economically rational as one that relies solely on the profit it generates from ticket sales.

Forgetting SQ, you glossed over the fact that most of the major competitors for QF into this country have received bailouts or bankruptcy bailouts. Imagine how things would be if those airlines had been left to fail and QF had been left to compete with other profitably run airlines on those routes? QF would probably be back on the KL route, and would probably have an extra flight or 2 a day to BKK as well. They'd also have quite a few extra flights to the USA too. The middle eastern carriers pay no company tax. Dubai already sees 28% of the cities GDP from aviation. The Government may not be providing outright subsidies to the airlines there, but they do provide amazing infrastructure at very cheap prices

I fly QF regularly internationally using points and can't fault their service. In economy we're all cattle, and in business class I'd say their food is superior to the likes of Asiana / Eva / Thai. People rave about SQ service, but in economy I've found them similar to any other airline and in it's too long since I was at the pointy end of the cabin to comment on their business class service. Certainly QFs hard product beats what Asiana have into this country and definitely beats Thai / Delta / United as well. I'd say QF business to the USA is superior thatn Virgin, and their lounge access in LA is way in front of what Virgin offer.

The Airline industry has to be one of themost distored by Government intervention. It it had been running based on free market principles there'd probably be 30-50% fewer airlines in the skies today that 25 years ago.

sydboy007 said:

Singapore has crony capitalism throughout the major companies. The head of Temasek is the wife of the PM and the way she has handled the SWF over the years she's been there has been woeful. You can blame some of the political instability in Thailand on the way they helped Thaksin try to avoid tax on his shincorp mobile sale.

Yes SQ is a well run airline, and the profit motive is still there, but you can't deny that when you have an overall view of the economics of extra capacity that a Government backed airline will not behave quite as economically rational as one that relies solely on the profit it generates from ticket sales.

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So where is the evidence? SQ has a higher RPK and load factor and a marginally lower yield. The metrics do not paint the story of an airline being run for the purpose of boosting tourism at discount prices.

sydboy007 said:

Forgetting SQ, you glossed over the fact that most of the major competitors for QF into this country have received bailouts or bankruptcy bailouts. Imagine how things would be if those airlines had been left to fail and QF had been left to compete with other profitably run airlines on those routes? QF would probably be back on the KL route, and would probably have an extra flight or 2 a day to BKK as well. They'd also have quite a few extra flights to the USA too. The middle eastern carriers pay no company tax. Dubai already sees 28% of the cities GDP from aviation. The Government may not be providing outright subsidies to the airlines there, but they do provide amazing infrastructure at very cheap prices

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There is more that goes into the economics of whether to fly a route than whether or not it is underserved. KL has always been a relatively low yield leisure route, as is BKK. Why waste an aircraft on a lower yield route when it can be better utilised on a high business route (SIN/HKG/Shanghai). BKK/KL are more natural Jetstar routes, IMO.

As for North America, I remember in the bad old days when Qantas used to generate 20% of group profit on the two flights/day they had SYD-LAX and business class was $14,000+. Qantas still charge $8,000+ for business to LAX (I know I have two flights with them in the next couple of months), and their load factor is 80%+. If they can't turn a profit with those numbers then they're kidding themselves. They're usually the most expensive across the Pacific by 20-25%.

sydboy007 said:

I fly QF regularly internationally using points and can't fault their service. In economy we're all cattle, and in business class I'd say their food is superior to the likes of Asiana / Eva / Thai. People rave about SQ service, but in economy I've found them similar to any other airline and in it's too long since I was at the pointy end of the cabin to comment on their business class service. Certainly QFs hard product beats what Asiana have into this country and definitely beats Thai / Delta / United as well. I'd say QF business to the USA is superior thatn Virgin, and their lounge access in LA is way in front of what Virgin offer.

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The service on QF varies from excellent to cr@p. I don't think you can compare Qantas to Asiana/EVA/Thai. These are not QF's natural competitors, they offer significantly cheaper fares. QF has always tried to pitch itself at the top end of the market, with SQ/CX. It's been a while since I flew SQ in business but the hard product on CX blows the Skybed out of the water.

This might be better in its own thread.

Turn back the forests

Is any one out there taking this government seriously.





http://www.abc.net.au/news/2014-03-06/clarke-and-dawe-welcome-to-contemporary-australia/5302498

IFocus said:

Turn back the forests

Is any one out there taking this government seriously.





http://www.abc.net.au/news/2014-03-06/clarke-and-dawe-welcome-to-contemporary-australia/5302498

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The more pertinent question would be - Is anyone taking you seriously?

springhill said:

The more pertinent question would be - Is anyone taking you seriously?

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No more or less than anyone else

springhill said:

The more pertinent question would be - Is anyone taking you seriously?

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I doubt it just like the comedy act we currently have for a government.

Australia is still handing out cheques despite age of entitlement being over


Tony Abbott opposes ‘government by chequebook’ but is helping businesses in Victoria, South Australia and Tasmania


http://www.theguardian.com/world/20...t-carbon-tax-as-the-main-cause-of-qantas-woes

Tony Abbott singles out carbon tax as the main cause of Qantas woes

Forget management decisions and the bitter turf war with Virgin – it seems Labor’s refusal to repeal the tax is to blame



http://www.theguardian.com/world/20...t-carbon-tax-as-the-main-cause-of-qantas-woes



Qantas carbon tax bill has been covered by ticket surcharge

CEO Alan Joyce and prime minister Tony Abbott have spoken of the tax’s $106m impact, yet its net effect was zero


http://www.theguardian.com/world/20...tax-bill-has-been-covered-by-ticket-surcharge

Our own Tea Party conservatives are a threat to Australia's economic record

Unlike what we can see in the US, success in Australia is more likely to be determined by effort, not by where you were born. Regrettably, our model is now under fierce attack

Over the last 30 years, the Australian economy has become one of the most open in the developed world and is now in its 23rd year of recession-free economic growth.

Australia is now the fifth richest nation in per capita GDP terms, according to the IMF. Only Luxembourg, Qatar, Norway and Switzerland are ahead of Australia. Despite the headwinds of the global financial crisis, the Australian economy grew by 15% over the past six years.

During the global crisis, the Australian government took decisive action to support economic growth and jobs. Businesses and workers responded, and we avoided the wide-scale economic destruction seen elsewhere. Australia’s 23m citizens can be proud of this, but should be even prouder of something more impressive.

Through the last three decades –18 years of which were under Labor led social democratic government – Australia did all this and still delivered social fairness. We turned outward to the world, embraced global trade and capital mobility and kept the fair go intact.

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While Australia still has pockets of disadvantage, our broader outcomes are very different to those in the US. Since the mid 1990s household income in Australia has improved as the hard won economic reforms of the previous decade kicked-in. Middle income Australian households are now more than 50% better off than they were in 1995. This has been achieved despite the global financial crisis, and the initial downturn in terms of trade that came with it.

In contrast, US middle income families are earning less in real terms than they were in 1989. In 2012, the real median US household income was $51,017 while 25 years earlier it was $51,681 in current dollars. In other words, a quarter of a century ago, a middle class American family was making more than a middle class American family today.

Meanwhile America’s rich have got richer – a lot richer.

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This is something the renowned economist Joseph Stiglitz explored in his book The Price of Inequality. Stiglitz points out that the US is seeing the slow strangulation of the American Dream, and that the US has surrendered much of its civil society to vested interests, which both stifles the lives of the poor but also risks future collective prosperity.

These huge increases in income and wealth at the top end are not trickling down. Indeed, Stiglitz points out that about 60% of the US’s income growth over the past three decades flowed to the top 1%.

Of deeper concern should be, that it’s very likely to stay that way. While many Americans believe fervently that they can ‘make it’ too, economic mobility is fast becoming a thing of the past. In the US, your parents’ income has more influence on your life chances than in just about all other developed countries.

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http://www.theguardian.com/commenti...es-are-a-threat-to-australias-economic-record

Lies, lies, dam lies and the Abbott government


Hardly the wages blowout of an inflexible market

As the Productivity Commission undertakes a "comprehensive" review of workplace laws, it's worth noting that Australia's soft economy is being accompanied by slowing wages growth - exactly what you'd expect to see in a market with a good degree of labour flexibility, writes Stephen Koukoulas.

Recent labour market data has confirmed a near textbook degree of flexibility in wages. At a time when employment growth is softening and the unemployment rate has been edging up, there has been a quite abrupt slowing in the pace of wages growth.

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Here are the facts.

Since the first half of 2011, the unemployment rate has edged up from a little below 5 per cent to the current rate of 6.0 per cent. This has been the direct result of the extended period of sub-trend economic growth as the terms of trade have fallen and as monetary policy was kept too tight for too long.

The flexibility of the labour market is shown in the fact that the annual pace of wages growth has slowed from around 4 per cent three years ago to a record low 2.6 per cent in the most recent period.

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What we all know this government is anti worker

All of which suggests the hidden agenda of reform to the labour market slowly but surely being unfurled by the Coalition government since the election is not really about macroeconomic management.

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More bad news for Abbotts reckless attack on Australia.

This is good news, and it is aided by the fact that productivity growth has been strong over the past year.

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http://www.abc.net.au/news/2014-03-...wages-blowout-of-an-inflexible-market/5305998

IFocus said:

Lies, lies, dam lies and the Abbott government
Hardly the wages blowout of an inflexible market
What we all know this government is anti wor

More bad news for Abbotts reckless attack on Australi
http://www.abc.net.au/news/2014-03-...wages-blowout-of-an-inflexible-market/5305998

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Ifocus, why do you think there has been a big drop in wage growth in the last 12 months, as opposed to three years ago.

Could it be because workers were scared of losing their jobs, as a result of the shambles called a Labor/Green minority government.

The complete loss of confidence, that Labor inflicted on the Australian population, was nothing short of incompetence or at worste economic vandalism.

This not only resulted in a loss of consumer confidence, as seen in the retail sector, but also in a drop in security of tenure for workers.

No it's easier to blame anyone other than those responsible.lol

Still getting no traction in the bottom of the cage.

Blame Tony, blame Tony, give me a cracker.lol

In about 12 months you will be able to blame Tony for the economic outcomes, currently nothing has been changed with regard fiscal settings.

Could it be because workers were scared of losing their jobs, as a result of the shambles called a Labor/Green minority government.

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They'll be even more scared now thanks to Tony.

GMH, Toyota, Qantas, who is next on the list ?

rumpole said:

They'll be even more scared now thanks to Tony.

GMH, Toyota, Qantas, who is next on the list ?

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Absolutely they will, but they know throwing more taxpayer money at failing businesses, isn't the answer.

Now we have hundreds of billions of unproductive debt that has to be serviced, thanks in main, to poor fiscal policy, planning and excecution by the Labor Party.

That debt, along with the debt that is going to required to implement productive infrastructure, has to be funded from the tax base.

Of course any sensible person is scared, it isn't rocket science, you keep swiping the credit card eventually someone has to pay for it.

I just can't get my head around why it's Tony's fault, maybe you could explain
In a sensible, logical, manner would be appreciated. Maybe a reference to fiscal responsibilty and budgetry constraint might help.
Just wishing we had the money to keep going further into debt, doesn't make it long term answer.

I just can't get my head around why it's Tony's fault, maybe you could explain
In a sensible, logical, manner would be appreciated. Maybe a reference to fiscal responsibilty and budgetry constraint might help.

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The point is that Tony said he would fix all the alleged bad for business things bought in by Labor.

If GMH, Toyota, Email & co really believed he was going to do that, why wouldn't they hang around instead of queueing up to leave ?

Can you explain that in a sensible logical manner to me ?

rumpole said:

The point is that Tony said he would fix all the alleged bad for business things bought in by Labor.

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The point is he said nothing of the sort. You must expect him to be a miracle man to clean up in six months, the pile of $hit that took the Labor/Greens six years to accumulate.

Calliope said:

The point is he said nothing of the sort. You must expect him to be a miracle man to clean up in six months, the pile of $hit that took The Labor/Greens six years to accumulate.

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Six months ?Those companies who are leaving don't expect him to fix it up AT ALL, that's why they are going.

sptrawler said:

Ifocus, why do you think there has been a big drop in wage growth in the last 12 months, as opposed to three years ago.

Could it be because workers were scared of losing their jobs, as a result of the shambles called a Labor/Green minority government.

The complete loss of confidence, that Labor inflicted on the Australian population, was nothing short of incompetence or at worste economic vandalism.

This not only resulted in a loss of consumer confidence, as seen in the retail sector, but also in a drop in security of tenure for workers.

No it's easier to blame anyone other than those responsible.lol

Still getting no traction in the bottom of the cage.

Blame Tony, blame Tony, give me a cracker.lol

In about 12 months you will be able to blame Tony for the economic outcomes, currently nothing has been changed with regard fiscal settings.

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You must get a new pair of Liberal blinkers.....you completely missed the point of the article.

rumpole said:

The point is that Tony said he would fix all the alleged bad for business things bought in by Labor.

If GMH, Toyota, Email & co really believed he was going to do that, why wouldn't they hang around instead of queueing up to leave ?

Can you explain that in a sensible logical manner to me ?

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Yes, it has been explain over and over, but here we go again.

The Australian car industry, like many other manufacturing industries in Australia, suffer from lack of scale, under investment and high input costs.
Our iron and steel, clothing and electronics/white goods industries all suffered from the same problems. They, like G.M and Ford, could have spent the money on increasing the output of their facilities and used Australia as an export hub.
It actually would have been quite sensible, as the raw product (cotton, iron ore, coking coal etc) were sourced here.
Also energy was cheap, this made Australia a logical choice to manufacture and mahufacturing made up 30% of the economy in the 1960's and early 1970's.
Meters, Kelvinator, Westinghouse fridges, stoves washing machines.
AWA, t.v, radios. Albany wool mills blankets,carpets, towels.
BHP Iron and steel works in Kwinana W.A, Port Kembla, Whyalla, Newcastle.
Midland workshops W.A, made locomotives and rolling stock

Now we have Holden, Ford and Toyota, what do they all have in common?
Well IMO they had the opportunity, to invest and grow their companies, they chose not to.
They instead leave it as a small local producer, that relies on tax payer money to stay in business. That is always destined to fail, it is just a matter of time.
They sell less and less product, because they haven't got the economies of scale, to adapt the product to changing consumer tastes.

So how does Tony change that in six months, without writing a blank cheque?
Which compounds the problem, or don't you see that as a problem?

sptrawler said:

So how does Tony change that in six months, without writing a blank cheque?
Which compounds the problem, or don't you see that as a problem?

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As I've said before, he doesn't have to write a blank cheque.

Inject some capital into those businesses. For example, buy their plant and machinery and lease it back to them or give them secured loans. The sort of things other investors would do. And reserve some of our gas exports for local users at a reasonable price.

That would keep them going until some of the structural problems can be sorted.

rumpole said:

Six months ?Those companies who are leaving don't expect him to fix it up AT ALL, that's why they are going.

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Obviously you are not a taxpayer. Its got nothing to do with Abbott. Ford, GM and Toyota are going because the taxpayer is tired of bailing them out. It's called throwing good money after bad. It's surprising that you post on a Stock Forum yet know so little about market forces.