Welcome to 2012! I hope you had a chance to have a break and spend time with family and friends. Time Brown CEO of our Aggreagtor group has enlighted us with some thoughts for 2012.
"As you know, it's been an interesting start to 2012 with America showing positive signs of recovery and China continuing to grow (albeit slightly slower than in prior years), but still ahead of analysis's predictions. Europe continues to struggle with its sovereign debt burden and there is really no magic solution. This will be a long term issue and will continue to act like an anchor for rest of the world's growth.
So what does all of this mean for Australia and more importantly for you as a business owner?
Firstly, rates will probably come down further but the banks will absorb most of the decreases with the increase cost of funds. Unemployment will more than likely rise in the short term as Banks, Manufacturers and Retailers come to a conclusion that their revenue will not meet budget for at least the coming year and in response will shed up to 10% of their work force. On the positive side both Queensland and WA still have strong growth in mining and will look to absorb a lot of the job losses. On the housing front there is still a shortage of housing supply with an estimate that there will need to be another 100,000 homes built to meet current demand, hardly an indicator of a housing bubble. Do not expect a lot from the Federal Government as they continue to show very little leadership in the current climate, especially now they have lost the support of a couple of key independents. Consumer confidence is the key and there are a number of survey's over the next few weeks t hat will give us an indication of how the general population feels about the year ahead. This could give us our strongest lead to what people's attitudes to buying property in the coming year will be. Certainly early indicators are that Sydney and Melbourne are shown signs of growth in the property market."
Tim Brown - CEO Vow Financial Pty Limited
