The Americanization Of Australia: Housing Bubble, Central Bank Panic, Low Wage Growth

G’day mate!

China’s exports plummeted by 8.3% in a recent report, fueling speculation of more easing from China. This is a continuation of a long-term trend from 2010.

chinaexp

Since Australia is dependent on exports to China (primarily of raw materials like iron ore), a downturn in China is going to be painful … for Australia.

chianrep

Here is the Aussie dollar compared to the Chinese Yuan.

ausyun

Just like in the USA, enter the Central Bank of Australia! with rate lowering, just like the US Federal Reserve.

ausiierates

Like the USA, Australian wage growth has slumped.

compeagfegfro

And Australia has a housing bubble, just like the USA … except that Australia’s housing bubble hasn’t exploded yet. Australian home prices are up 42% since Q1 2009.

AUSSIEHP

Rising home prices and declining wage growth. A page straight out of the USA playbook.

In a global economy, both the US and Australia suffer when China contracts. Australia is starting to look more and more “Americanized” with low wage growth and an active Central Bank. Good luck with that, mates!

There is only one thing to do! Open a Castlemain XXXX and put the shrimp on the barbie.

beer-castlemaine-xxxx-001shrimpbarbie

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