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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Moominoid who wrote (5589)	2/12/2002 10:46:26 PM
From: macavity	Read Replies (1) \| Respond to of 33421

Cheap AUD!. Oh no here he comes with one of those inane statements !!. The reason why the AUD is cheap is that no-one wants it. It is a beautiful country, but no-one with internationally marketable skills will stay there to earn. Here in Tokio there are tonnes of bright, hardworking Aussies and Kiwis who are earning JPY as they cannot even approach that earning rate in OZland. And there is the catch, no-one wants enough exports to lift the currency, and there is a massive brain drain. There is no real competition (foreign) in OZ as the unions have (IMO) too much power, and the whole outlook is frankly protectionist. All in all it reminds me of Great Britain in the 70's. I have a friend who has a saying. "Whenever you go to a country and all they say is buy local goods - do not invest there!" In OZ, all they say is "buy OZ this , buy OZ that" to protect local industry such as Cars etc.. This is just like British Leyland and the UK government in the 70's. The whole set-up of OZ protects its inefficient workers in global competitive markets, they have massive tariffs on a variety of imports. OZ has globally-efficient industries but these are the commodity based ones like agriculture, not the value-added ones like manufacturing. Up until now commodities have been (still are perhaps) in a major bear market. The net result is that no-one will invest in OZ because i) Local industries are either not globally competitive, or are in global bear markets. ii) Most people with talent leave to Europe or Japan to earn money, and will tend to return to 'retire'. This is a major problem for a whole bunch of (developed) countries, free labour and restricted capital/competition. Step forward extreme cases - Argentina, SouthAfrica. For the coming years, Europe and the US (perhaps even Japan) will have a free call on the worlds educated labour markets, from Eastern Europe, Asia, and the southern hemisphere developed countries. OZ - great to live there, would not want to earn there! - macavity