Australian (ASX) Stock Market Forum

The state of the economy at the street level

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Gringotts Bank said:
Crash or severe downturn in the next 6 months, according to my hairdresser. Sounds like a joke doesn't it? He is one of those low intellect guys who is very sensitive and intuitive.
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His intellect may be far higher than you're assuming?

Plus it's the sort of job that involves meeting a lot of people, some of whom know plenty and have likely made relevant comments he's picked up on?

Just a thought. :2twocents
 
Gringotts Bank said:
Crash or severe downturn in the next 6 months, according to my hairdresser. Sounds like a joke doesn't it? He is one of those low intellect guys who is very sensitive and intuitive. Combined with a stable emotional makeup, this makes him brilliant at picking long term turning points in property and financial markets. I've known him for a long time and he has become very wealthy.
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Not a joke, but has that sort of ring of something that almost can't be fully wrong. If he just said "crash", then that's a proper prediction. A severe downturn isn't very meaningful term (given a little bit of hyperbole seems to be built into convos with cabbies, barmen and barbers) - unless he's going to state where All Ords will be, it sounds bit unfalsifiable. I mean various areas of the economy, notably real estate, are already in downturn.

That might be too sceptical, but I'm genuinely interested in how the good predictor's manage it. Maybe try to pump him for more specific info:D
 
@Gringotts Bank is going to turn bald in a relentless effort to share his hairdresser advice with us with daily visit
Joke aside, a barber is a great indicator.Maybe sexist in the #metoo period but men talk work and economy with the barber, who has a great access to the pulse of the local area
And we all know that the mood of the population can make or break the economy
Only need to be cautious about the local bias
Should start the barber economic mood indicator spread across the nation.would beat the abs one that is for sure
 
The collapse in OZ and US bond prices is the most telling signal of economic expectations. We are in dangerous territory. This is a very good analysis of where we have been and where we are heading.

Bond yields are useful for telling us about the future. And it's not looking good
Greg Jericho
For the past six months we’ve started to see a negative yield curve – an indicator of a recession
https://www.theguardian.com/comment...-us-about-the-future-and-its-not-looking-good
 
There is another analysis on the state of the economy on the ABC. It "expalins" why the stock market jumps when interest rats falls - but also points out that when the merde hits the fan gravity does suck..
The economy is awful and that's great news for investors
By business editor Ian Verrender
Updated yesterday at 8:36am

7419236-3x2-340x227.jpg Photo: The lower interest rates go, the better the stock market performs. (AAP)
Related Story: The Reserve Bank will cut rates again and again — and it's our fault
Related Story: We're hocked to the eyeballs in debt with no obvious way out
Related Story: Economic slowdown heading to GFC levels
Bad news suddenly has become good again. No matter where you look, there are signs of a global slowdown while wars are brewing at a trade, currency and even military level.

Here at home, the economy is sputtering. Growth is slowing, inflation is on the mat, unemployment is ticking higher.

The situation has deteriorated to such an extent that it's even jolted the Reserve Bank into action after three years of nothing.
https://www.abc.net.au/news/2019-06...ful-economy-great-news-for-investors/11239398
 
qldfrog said:
Joke aside, a barber is a great indicator.Maybe sexist in the #metoo period but men talk work and economy with the barber, who has a great access to the pulse of the local area
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Barbers are one certainly but I'd expect there's also quite a few others who'd have some information that could be a useful indicator.

One possible example would be the average transaction size at service stations for fuel purchases. If there was a trend toward people buying $20 worth of petrol rather than filling the tank, well that wouldn't be a good sign economically. Whether there is any such trend I've no idea but if there was, well it would suggest that consumers don't have any money.

Taxi / Uber drivers another obvious one especially those based in the CBD.

I wouldn't be surprised if the amount of rubbish and recycling collected has some correlation to the economy especially cardboard. Every new appliance and a lot of furniture will come in either a big cardboard box or wrapped in plastic. The total volume collected thus might be relevant.

In the long term the economy is becoming more energy efficient but any sudden change in consumption across electricity, gas and liquid fuels is a sure indication that something's up economically, that's very clear from past recessions. Slow change due to better buildings and cars etc sure but be on the lookout for anything sudden. For example the reported huge % drops in diesel consumption in China can't plausibly be explained by more efficient engines etc when we're talking 14% in a month and stuff like that.:2twocents
 
SirRumpole said:
Car sales down. A sure sign that the economy is tanking.
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Agreed - when it's 14 consecutive months it's pretty clear that there's something going on there.

Whilst there's probably a few people waiting for electric cars or whatever, I very much doubt that's on a sufficient scale to explain the extent of the drop in new car sales seen thus far. Economic reasons seem far more likely to me.
 
StockyGuy said:
That might be too sceptical, but I'm genuinely interested in how the good predictor's manage it. Maybe try to pump him for more specific info:D
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Well that's sort of a problem, because when he talks it's evident he cannot translate his insights into words. Or he'll say something like "12 months ago, you could have bought a house for ....". Yawn. However I definately pay attention to the gist because he has never been wrong. He has also said plenty of other things which indicate he has a very good feel for markets and trends. That's why I go there - I'm always on trend with my manscaping. :bear: :sneaky: :phantom: :roflmao:
 
Smurf1976 said:
I wouldn't be surprised if the amount of rubbish and recycling collected has some correlation to the economy especially cardboard. Every new appliance and a lot of furniture will come in either a big cardboard box or wrapped in plastic. The total volume collected thus might be relevant.
.:2twocents
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You are spot on there smurf, my mate the garbo, reckons it breaks his heart to pick up lawn mowers, fridges, vacuums, furniture etc, all with signs written on them "In Working Order".
He picks them up in the jaws of the little loader and puts them into the truck crusher, you can't give stuff away today.
It wasn't many years ago garage sales were all the go, i don't see many around these days.
Times, they are changing.
Maybe the reality is, there are too many shops, to cater for a changing demographic.
Only old people wash their cars, mow their lawns etc, the new generation get the lawn mowed, that is if they have a lawn. Run their car through the car wash, or don't bother at all.
People aren't spending, retail is in the doldrums, but how much is the reality of our changing World and the way we spend money and how much is due to no one having money?
 
sptrawler said:
People aren't spending, retail is in the doldrums, but how much is the reality of our changing World and the way we spend money and how much is due to no one having money?
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Discretionary spending is being eaten away by increases in prices for essentials, power, gas, water, council rates, rents, health insurance, medicines, state government charges and the like.

So on a non increasing income once you pay that stuff off, there is very little else to spend on what companies produce.

On Q&A last night the only person who made any sense was the Centre Alliance Senator Rex Patrick, saying basically gas prices are killing the economy. Dead right and the government has to do something about it.
 
SirRumpole said:
Discretionary spending is being eaten away by increases in prices for essentials, power, gas, water, council rates, rents, health insurance, medicines, state government charges and the like.

So on a non increasing income once you pay that stuff off, there is very little else to spend on what companies produce.

On Q&A last night the only person who made any sense was the Centre Alliance Senator Rex Patrick, saying basically gas prices are killing the economy. Dead right and the government has to do something about it.
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That is a very good point Rumpy, statutory costs have gone up regardless and are by far one of the biggest outgoings from wages.
Funny how putting taxes down is so scorned upon and putting taxes up was cheered along.:eek:
 
SirRumpole said:
Sorry froggy, must have missed that one.:)

They were different articles though.
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Same link, probably updated between 5am and 12, but no worries, while we have some fundamentally different views politically, overall I have the upmost respect for your positions and level headed attitude.
Kudos
I end the bromance there
 
sptrawler said:
Only in Sydney and Melbourne, and only if they aren't an apartment.
I'm sure country towns are a lot cheaper, also if you really want cheap shelter, come to Perth.
Funny how everything is Sydney centric, if you can't afford to buy in Syndey, you have to climb under a rock and die, the World will end.:roflmao:
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Everything is relevant to the inputs that determine value.

So is Perth fair value at the moment?

So country towns are a lot cheaper you say? By what metric. Because a house in Sydney is $1M and a house in the country, say 200km away from the the CBD is only $0.5M, it is cheaper? Well yes on figures alone, but markets take into consideration much more than price

I personally think even country properties are overvalued, but I might be wrong, but then again there is some reason why everything is slowing down and a recession (a good thing for the long term longevity of this country) is on the horizon and just as the sun rises and sets, so do recessions.
 
satanoperca said:
Everything is relevant to the inputs that determine value.

So is Perth fair value at the moment?

So country towns are a lot cheaper you say? By what metric. Because a house in Sydney is $1M and a house in the country, say 200km away from the the CBD is only $0.5M, it is cheaper? Well yes on figures alone, but markets take into consideration much more than price

I personally think even country properties are overvalued, but I might be wrong, but then again there is some reason why everything is slowing down and a recession (a good thing for the long term longevity of this country) is on the horizon and just as the sun rises and sets, so do recessions.
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Perth prices are back to what they were nearly 20 years ago, wages in the last 20 years have gone up a lot, but it still depends on what you call fair value.
I sold a house for a lot of money 12 years ago, looking on Domain.com, it is still the same price.
As for country property prices, here in W.A they are really low, but people still aren't buying.
I just think a lot of people have re prioritised, what they spend their money on.
 
SirRumpole said:
On Q&A last night the only person who made any sense was the Centre Alliance Senator Rex Patrick, saying basically gas prices are killing the economy. Dead right and the government has to do something about it.
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There's basically no form of economic activity that uses literally zero energy and for a lot of things its a significant input.

High cost energy is thus a drag on pretty much the entire economy. :2twocents
 
sptrawler said:
Perth prices are back to what they were nearly 20 years ago, wages in the last 20 years have gone up a lot, but it still depends on what you call fair value.
I sold a house for a lot of money 12 years ago, looking on Domain.com, it is still the same price.
As for country property prices, here in W.A they are really low, but people still aren't buying.
I just think a lot of people have re prioritised, what they spend their money on.
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Everyone still wants a place to call home.

Maybe Perth prices are fair value, maybe they are cheap, maybe they are still over priced.

Regardless, markets always have a way to sort themselves out, the only variable that few can calculate with accuracy is time.
 

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