Skip to comments.Lessons from Down Under (How Australia avoided a recession and what we can learn from them)
Posted on 10/12/2010 10:37:24 AM PDT by SeekAndFindEdited on 10/12/2010 5:41:57 PM PDT by Admin Moderator. [history]
Unlike most of the world, Australia did not have a recession during the last two years. In fact, it has not had a recession in the last 19 years. Its economic growth rate is higher than in the United States, and the unemployment rate there is only 5.1 percent. From the middle 1800s until the early 1900s, Australia enjoyed a higher per-capita income than the United States. It then fell behind, but in the last couple of decades, it has gone through an economic revival. There are positive and negative lessons for the U.S. and the rest of the world from Australia.
(Excerpt) Read more at washingtontimes.com ...
For most of this decade, the Aussie to USD exchange rate flucturated between 0.75 US/AUD to 0.8 US/AUD.
Today, the Aussie is ALMOST AT PARITY with the USD.
I was in Australia just a month ago. Everything is EXPENSIVE THERE compared to the USA partly because they have a Good and Services Tax (GST) and partly because of our devalued US dollar.
If you think Australia is expensive, try Europe!
Everything costs 3 times more in Europe except for
bus and train tickets.
BTW, Mortgages in Australia are NOT tax deductible, unlike here in the USA.
Also, their 4 biggest banks seem to be quite conservative in their lending practices -— WESTPAC, ANZ, National Asutralia Bank and Commonwealth Bank.
Will Australians regain their economic footing before they allow themselves to fully re-embrace statism and end up with the disastrous policies of the Obama administration? The jury is out. But, President Obama is perhaps useful to the extent that his policies serve as a bad example for the rest of the world.
1.) Enacted a financial reform policy, all of 86 pages if my memory is correct that they asked Clinton to go along with, but he declined. It has worked well since the mid 1990's.
2.) They have a balance of trade since they are energy self sufficient and a next exporter thereof.
3.) Not investment advice, but if you could perchase them, ( it is hard to do ) they had CD's a while back for 1 yr that was yielding 6%.
I agree with this statement :
“Mankind seems to be programmed not to remember the reasons for economic success and failure - and these lessons seem to need to be relearned every few years. The normal course of events is for free and prosperous economies (particularly under democracies) to move toward less freedom - more government spending, taxation and regulation - until the burden of government brings growth to a halt or near-halt.”
Australia is now MOVING BACK towards more government and more taxing and spending, forgetting the policies of Prime Minster John Howard, who led Australia for close to 10 years and led her to prosperity.
The Aussies have moved LEFT in 2007 with the election of a Labor Government (which they re-elected this year by a bare margin).
It’s amazing the amount of economic benefit a nation can get if it is allowed to use its natural resources.
We have our wealth buried in the ground but regulation prevents us from digging it up and selling it.
Like the article says, it’s all about economic freedom.
Of course some in Australia have been doing their best to screw it up (a recent tax on mining for instance).
Australia now runs trade deficits largely because of poor monetary policy and the now-overvalued Aus. dollar. Same as us!