China Slowdown Hits Australia Where it Hurts
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  • Jim__L

    I thought there was a story a while back about how China’s growth was being hurt by production moving to other countries.

    If that’s a major contributor here, wouldn’t that mean Australia’s commodities would just be in demand elsewhere, as other poor countries imitate China’s rise?

    • Andrew Allison

      Commodity prices are falling across-the-board due to declining demand (http://www.indexmundi.com/commodities/)

      • Jim__L

        Well that figures, when the world economy is experiencing dislocations.

        This is probably a nice opportunity to make long-term investments in some Aussie commodity production ventures. =)

    • ljgude

      Sure, and Australia sells a lot of commodities to Japan too and other SE Asian countries and has a clear geographical advantage in this part of the world. But as Andrew points out commodity prices have fallen due to drop in world wide demand which was just insatiable in the run up that has kept Western Australia, in particular, booming for years.

  • ljgude

    I have the best seat in the house on this one folks. I live in Perth, and Western Australia which is the state that produces the bulk of Australia’s commodity exports. This town has been rolling in money and has a property boom that makes it one of the most expensive places anywhere to buy a house. But I have friends in retail and the glow is definitely off and has been for a good six months. Australians tend to anticipate bad times and wind their necks in before the blow falls. Rudd or alternative Tony Abbot will have some tricky times to manage economically. Switching to the more conservative Liberal Party, which has a good record for financial management might be the obvious choice, but Liberal leader Abbot is a Roman Catholic Social Conservative, like Santorum in the US, in a country that has little love for that kind of politics. Even though Gillard’s Labor government was clearly on the nose with voters, I expect Rudd to improve labor’s chances. His opponent has weaknesses and he doesn’t have to defend his predecessors government.

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