The state of the economy at the street level

[So_Cynical]

Sydney city was packed tonight for Vivid, never seen so many people in town out side of NY's or some similar event, standing room only on the train home at 10.30...no visible signs of financial distress at street level tonight.

 

[sydboy007]

Sydney city was packed tonight for Vivid, never seen so many people in town out side of NY's or some similar event, standing room only on the train home at 10.30...no visible signs of financial distress at street level tonight.

My new housemate was out to meet her sister and family last night for vivid. She also couldn't believe how busy it still was as they'd purposefully left going till later in the festival. From the news reports the last few weekends have been crazily busy. Certainly should be making a lot of the businesses around the harbour very happy.

 

[qldfrog]

could also be the sheer increase of size in the population
legal/illegal immigrants..sorry refugees who travelled here and got lost;
And as the infrastructure has not followed..
festival in India are VERY busy, crowds ofpilgrims in Mecca , not so sure I would link number to wealth or available money, but I wish you are right.

 

[Smurf1976]

Sydney city was packed tonight for Vivid, never seen so many people in town out side of NY's or some similar event, standing room only on the train home at 10.30...no visible signs of financial distress at street level tonight.

I didn't go myself, it's not my music style that's for sure, but there was some hip-hop type event on in Hobart last night. Sold out apparently and it was at a fairly large venue - I know someone who had trouble getting tickets.

So that sort of thing still seems to be doing well.

 

[sydboy007]

Just been into the Sydney CBD and it's as busy as usual, surprising given the gloomy weather.

Plenty of shopping bags to be seen too. T2 was doing well, but then I thin shops that have cheap "luxuries" tend to weather the storm not too badly. Bit like how women will supposedly buy themselves lipstick or makeup instead of other stuff when times are tight.

Would be interesting to see how smaller suburban shopping centres are fairing though. I know Sydney things have migrated to Broadway / Pitt St Mall / Bondi Westfields. Newtown / Paddington have really died. There's plenty of for lease signs around the edge of the CBD too. Not sure how many more Thai restaurants we can have here, even though it now seems to be the national dish (at least in Sydney).

 

[Smurf1976]

A significant business collapse today, electrical contractor PSG has gone bust and ceased operations immediately.

About 600 employees nationally, largely electricians and associated workers plus administration.

Vic - 200 workers. Tas - 200 workers. SA - about 100. Qld - about 100.

So not looking good there it seems. Also in the news, a smallish bus manufacturing company in SA has gone bust - roughly 50 jobs gone I think.

 

[Judd]

A significant business collapse today, electrical contractor PSG has gone bust and ceased operations immediately.

About 600 employees nationally, largely electricians and associated workers plus administration.

Vic - 200 workers. Tas - 200 workers. SA - about 100. Qld - about 100.

So not looking good there it seems. Also in the news, a smallish bus manufacturing company in SA has gone bust - roughly 50 jobs gone I think.

Ouch! Didn't they have a contract for the NBN? I remember reading that somewhere and also it was/is, I believe, a part of a private equity group.

 

[sydboy007]

maybe not something you can see but probaby starting to be felt by many.

From the ABS today:

The median weekly earnings for employees in their main job was $950, at August 2013, according to the Australian Bureau of Statistics (ABS). This represents a 2 per cent decrease in real median earnings (CPI adjusted) over the year. This was the first year to year decrease since 2008…

Real (earnings adjusted by CPI) median weekly earnings in main job fell by 2.1% in the year to August 2013, the largest fall in a decade. Real mean weekly earnings were essentially unchanged (a fall of 0.2%). However, in the previous year (from August 2011 to August 2012), real median and real mean weekly earnings in main job each rose by 3.5%. Over the decade to August 2013, real median weekly earnings rose by 14% while real mean weekly earnings rose by 20%.

So while the GDP figures may look great from the outside, more and more it's going to feel like a recession for many as real wages continue to decline as the ToT keeps falling and GNI falls away with it.

 

[sydboy007]

In the year to April 2014, 8.89 million Australians holidayed overseas over the year – a 139% increase on 10 years ago (3.71 million)

According to the ABS, the number of Aussies leaving to holiday in South East Asia (particularly Indonesia and Thailand) rose to a record 250,400 in April, with South East Asia also accounting for 32% of Australia’s total tourist departures over the month

From the looks of it roughly 800,000 Australians headed off overseas in April. I know it's probably a bit dated since it's before the no surprises budget, but if roughly 3% of the population can have an overseas holiday in just one month, things can't be that bad

 

[skc]

From the looks of it roughly 800,000 Australians headed off overseas in April. I know it's probably a bit dated since it's before the no surprises budget, but if roughly 3% of the population can have an overseas holiday in just one month, things can't be that bad

I liked this story on the AFR.

http://www.afr.com/p/opinion/new_wealthy_poor_making_less_sense_VovcjDp9H1OTpRNI9NowMP

Known by many economists as the “wealthy poor” – a growing class of Australians is emerging.

This is a group of educated, well-earning people, in their late 20s with no children who are yet to break the over-priced Australian property market. They earn around or just above the national average wage of $77,800 a year. But like many others, this new breed are really only a few pay cheques away from bankruptcy. Nowadays, wealthy has a case of mistaken identity.

 

[qldfrog]

From the looks of it roughly 800,000 Australians headed off overseas in April. I know it's probably a bit dated since it's before the no surprises budget, but if roughly 3% of the population can have an overseas holiday in just one month, things can't be that bad

travelling overseas is cheaper than inland , especially if the focus is on alcohol/party
so yes more and more bog travel to the worst area of bali/fidji, etc;
and the wealthy are using the strong USD while it lasts...
remember that some people are broke but keep piling up on the credit card..you and i may not do it, but i know someone on the verge of bankrupsy who purchased a cruise for the family just before the account was empty...
now fighting to keep the house....

 

[Smurf1976]

Ouch! Didn't they have a contract for the NBN? I remember reading that somewhere and also it was/is, I believe, a part of a private equity group.

Not sure who owned it but they were definitely doing some NBN work. Not sure how much of their business was NBN-related but definitely there was some. They also have a number of major contracts, eg the new hospital being built in Adelaide is one.

It's as dead as can be it would seem. I'm told that by this afternoon one particular local contractor here in Tas has thus far managed to pick up enough of the work that there would be no prospect of PSG returning to operation since the customer base has already substantially gone elsewhere. At a guess, most likely that wouldn't include anything NBN-related given the complexity of such contracts etc.

 

[sydboy007]

Strip out net exports and adjust for the population ponzi and things are not looking good with the good ship Australia. Just another reason why a lot of people are finding it harder to pay the bills.

http://www.macrobusiness.com.au/2014/06/your-falling-living-standards-charted/

The two measures chosen are:

Gross national expenditure (GNE), which is “the total expenditure within a given period by Australian residents on final goods and services (i.e. excluding goods and services used up during the period in the process of production). It is equivalent to gross domestic product plus imports of goods and services less exports of goods and services”.
Domestic final demand (DFD), which is the sum of “government final consumption expenditure, household final consumption expenditure, private gross fixed capital formation and the gross fixed capital formation of public corporations and general government”.
As you can see, both measures exclude the growth impact from rising export volumes.

So what do these measures show when measured on a per capita basis?

First, after rising solidly in the three years to September 2012, both GNE and DFD have been falling:

 

[sptrawler]

The job losses keep racking up, however I am noticing a lot more fast food outlets are opening up.

Australia post to shed 900 jobs.
http://www.abc.net.au/news/2014-06-08/australia-post-to-cut-hundreds-of-jobs-report/5508236

BHP to shed another 280 jobs.
https://au.news.yahoo.com/thewest/business/wa/a/24195122/bhp-axes-180-jobs-at-newman/

A relative was down from Kalgoorlie on the weekend, apparently it is in a terrible state, people leaving in droves.

I suppose a lot of Eastern Staters will be heading back across the Nullabor, and NZers heading home. During downturns it is usually best to be close to family.

 

[Tyler Durden]

The job losses keep racking up, however I am noticing a lot more fast food outlets are opening up.

Australia post to shed 900 jobs.
http://www.abc.net.au/news/2014-06-08/australia-post-to-cut-hundreds-of-jobs-report/5508236

BHP to shed another 280 jobs.
https://au.news.yahoo.com/thewest/business/wa/a/24195122/bhp-axes-180-jobs-at-newman/

A relative was down from Kalgoorlie on the weekend, apparently it is in a terrible state, people leaving in droves.

I suppose a lot of Eastern Staters will be heading back across the Nullabor, and NZers heading home. During downturns it is usually best to be close to family.

Yes, food certainly seems to be a staple, but I wonder if all these job losses will affect the prices at these places. I guess it might, in part, explain the comments against instituting a tipping culture in Australia.

And for me, the quality of service of Australia Post is already quite sub-standard, not sure what cutting 900 jobs is going to do to that alread sub-standard level of service.

 

[So_Cynical]

(31st-May-2014 ) Sydney city was packed tonight for Vivid, never seen so many people in town out side of NY's or some similar event, standing room only on the train home at 10.30...no visible signs of financial distress at street level tonight.

Absolutely packed again on both Saturday and Sunday Afternoons/night, coffee shops with customers 3 deep, same with the take away food joints and many of the sit down establishments..no visible signs of financial distress at street level at all.

 

[Tyler Durden]

Absolutely packed again on both Saturday and Sunday Afternoons/night, coffee shops with customers 3 deep, same with the take away food joints and many of the sit down establishments..no visible signs of financial distress at street level at all.

I suppose the issue of that might be, you're only seeing the people who can afford to go out, and not the people who are at home because they can't afford to go out. Just trying to play the devil's advocate - bear style.

 

[Wysiwyg]

Absolutely packed again on both Saturday and Sunday Afternoons/night, coffee shops with customers 3 deep, same with the take away food joints and many of the sit down establishments..no visible signs of financial distress at street level at all.

You know what that is. People 'feeling' rich (for the youths, parent house worth plus half million) with the value of their property and low mortgage interest rates. When the official goes to 5% and over (won't happen soon obviously) them coffees are gonna be at home satchels in front of the telly. Enjoy it while it lasts I suppose plus psychologically it is good to 'feel' better.

 

[So_Cynical]

I suppose the issue of that might be, you're only seeing the people who can afford to go out, and not the people who are at home because they can't afford to go out. Just trying to play the devil's advocate - bear style.

Sure, would add that the Vivid festival is a free event and maybe that's a factor too...still coffee shops etc were packed, seriously customers 3 deep at the registers buying $4.30 coffees and hot chocolates, public transport packed often with standing room only, and it was cool on both nights with occasional drizzle.

 

[Sound]

The job losses keep racking up, however I am noticing a lot more fast food outlets are opening up.

Probably pre-empting the fact that as people have less money, they resort to cheaper & lower quality food. An additional factor would be the potential for GST to be introduced on fresh food.


Regarding Vivid, I too was surprised at the sheer quantity of people attending. I would however struggle to claim this has anything to do with consumer sentiment, but rather broad population growth, coupled with the fact that it's an entirely free event.