The economy is lukewarm to tepid, but not dead.
For a country supposedly in the middle of an economic crisis so grave that it cannot be described without the obligatory passing mention of the Great Depression, yesterday’s ABS retail turnover figures were hardly the stuff of nightmares.
At worst, the national economy appears to be treading water. At best, the national economy appears to be treading water. We might not actually be going anywhere, but it’s a pretty good outcome when you consider that expectations play a sizeable role when it comes to the willingness of people to open their wallets, and the last 6 months of media coverage framing those expectations has been the equivalent of some nutter standing on the corner banging on about the end of the world being nigh......
Retail turnover data is the least worst measure we have when it comes to the rubber hitting the road of the real economy in terms of how money is flowing out of people’s wallets and into the nation’s cash registers. What it shows at its most basic level is that some States are faring better than others as the financial crisis has increased the spread of retail activity between States, highlighting the disparity in economic activity driven by regional factors across Australia....
If NSW wasn’t such a basket-case, the national figures would be looking quite spiffy all things considered. We don’t so much have an economic crisis as we a NSW crisis.
It will be interesting to see if the Rudd Government's one-off payments to self-funded retirees, pensioners, familes and low-income earners (due in December) will actually lift NSW up to the 0.0 line on the graph.
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