Showing posts with label interest rates. Show all posts
Showing posts with label interest rates. Show all posts

Saturday 11 November 2023

Tweet of the Week


 


 

Thursday 9 November 2023

AUSTRALIAN SOCIETY STATE OF PLAY: Interest rates and cost of living - there is no good news in November 2023

Reserve Bank Logo


The Reserve Bank of Australia as one of its monetary policy decision tools employs a cash rate target.


In the Reserve Bank's own words:

The cash rate is the interest rate that banks pay to borrow funds from other banks in the money market overnight. It influences all other interest rates, including mortgage and deposit rates.

In technical terms, it is the interest rate on unsecured overnight loans between banks (loans banks use to manage their liquidity). It is our operational target for the implementation of monetary policy.


The Bank's inflation target is; to keep annual consumer price inflation at between 2 and 3 per cent, on average, over time.


On 7 September 2016 the Australian Reserve Bank cash rate target stood at 1.50% and it remained unchanged for over two year and seven months, until it fell by 25 basis points to 1.25% on 5 June 2019.


The cash rate target continued to fall the next five months until it reached 0.10% on 4 November 2020 and remained unchanged until 4 May 2022 when it rose to 0.35%.


Since then the monthly cash rate target announcements began to tread water on 5 July 2023 at 4.10%.


Sadly, on 8 November 2023 the cash rate target again rose by 25 basis points to 4.35% - the 13th rate hike since May 2022.


The Reserve Bank's next monthly target announcement is due on Tuesday, 5 December 2023.


As for the Reserve Bank's inflation target of keeping consumer price inflation at between 2 and 3 per cent, this target range had been met consistently for the ten and a half years up to December Quarter 2021 and ever since been consistently exceeded. Peaking at 7.8% in December Quarter 2022 before gradually falling to 5.4% in September Quarter 2023 with a monthly indicator of 5.6%.


I suggest that readers do not anticipate any interest rate relief this coming December. Nor expect any significant fall in the Living Cost Index or Consumer Price Index as the country enters 2024.


If The Guardian article on the latest Essential Research poll is correct, it is likely that the more than half of all Australian voters who reportedly are struggling financially will read the following with a jaundiced eye.......



Reserve Bank of Australia, MediaRelease, 7 November 2023:


Statement by Michele Bullock, Governor: Monetary Policy Decision Number 2023-30

Date 7 November 2023


At its meeting today, the Board decided to raise the cash rate target by 25 basis points to 4.35 per cent. It also increased the interest rate paid on Exchange Settlement balances by 25 basis points to 4.25 per cent.


Inflation in Australia has passed its peak but is still too high and is proving more persistent than expected a few months ago. The latest reading on CPI inflation indicates that while goods price inflation has eased further, the prices of many services are continuing to rise briskly. While the central forecast is for CPI inflation to continue to decline, progress looks to be slower than earlier expected. CPI inflation is now expected to be around 3½ per cent by the end of 2024 and at the top of the target range of 2 to 3 per cent by the end of 2025. The Board judged an increase in interest rates was warranted today to be more assured that inflation would return to target in a reasonable timeframe.


The Board had held interest rates steady since June following an increase of 4 percentage points since May last year. It had judged that higher interest rates were working to establish a more sustainable balance between supply and demand in the economy. Furthermore, it had noted that the impact of the more recent rate rises would continue to flow through the economy. It had therefore decided that it was appropriate to hold rates steady to provide time to assess the impact of the increase in interest rates so far. In particular, the Board had indicated that it would be paying close attention to developments in the global economy, trends in household spending, and the outlook for inflation and the labour market.


Since its August meeting, the Board has received updated information on inflation, the labour market, economic activity and the revised set of forecasts. The weight of this information suggests that the risk of inflation remaining higher for longer has increased. While the economy is experiencing a period of below-trend growth, it has been stronger than expected over the first half of the year. Underlying inflation was higher than expected at the time of the August forecasts, including across a broad range of services. Conditions in the labour market have eased but they remain tight. Housing prices are continuing to rise across the country.


At the same time, high inflation is weighing on people’s real incomes and household consumption growth is weak, as is dwelling investment. Given that the economy is forecast to grow below trend, employment is expected to grow slower than the labour force and the unemployment rate is expected to rise gradually to around 4¼ per cent. This is a more moderate increase than previously forecast. Wages growth has picked up over the past year but is still consistent with the inflation target, provided that productivity growth picks up.


Returning inflation to target within a reasonable timeframe remains the Board’s priority. High inflation makes life difficult for everyone and damages the functioning of the economy. It erodes the value of savings, hurts household budgets, makes it harder for businesses to plan and invest, and worsens income inequality. And if high inflation were to become entrenched in people’s expectations, it would be much more costly to reduce later, involving even higher interest rates and a larger rise in unemployment. To date, medium-term inflation expectations have been consistent with the inflation target and it is important that this remains the case.


There are still significant uncertainties around the outlook. Services price inflation has been surprisingly persistent overseas and the same could occur in Australia. There are uncertainties regarding the lags in the effect of monetary policy and how firms’ pricing decisions and wages will respond to the slower growth in the economy at a time when the labour market remains tight. The outlook for household consumption also remains uncertain, with many households experiencing a painful squeeze on their finances, while some are benefiting from rising housing prices, substantial savings buffers and higher interest income. And globally, there remains a high level of uncertainty around the outlook for the Chinese economy and the implications of the conflicts abroad.


Whether further tightening of monetary policy is required to ensure that inflation returns to target in a reasonable timeframe will depend upon the data and the evolving assessment of risks. In making its decisions, the Board will continue to pay close attention to developments in the global economy, trends in domestic demand, and the outlook for inflation and the labour market. The Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that outcome.


Tuesday 5 September 2023

Everyone is hoping that the Reserve Bank of Australia continues to restrain the urge to raise interest rates today


IMAGE: Depositphotos


By late August 2023 mainstream media was reporting that in the 2022-23 financial year supermarket giants Coles and Woolworths recorded profits in excess of $1 billion representing around a 5% increase on the previous year - withy Woolworth’s recording a nearly 20% rise in grocery sector earnings while Coles recorded a 2.9% rise.


These grocery earnings being an almost direct cash transfer from dwindling household piggy banks to supermarket chain bank accounts.


In August the major banks were also reporting fat financial year profits, with the Commonwealth Bank coming in with a personal record breaking best of $10.2 billion in 2022-23.


None of the big banks being slow in coming forward to pass on increasing Reserve Bank of Australia cash rates onto customers, including those with home mortgages.


According to the ABS latest monthly consumer price index indicator, rent prices increased 7.6% in the twelve months to July 2023, up from 7.3% in June, reflecting strong demand for rental properties and tight rental markets.

Electricity prices rose 15.7% in the twelve months to July 2023, reflecting annual price reviews in July.

Annual prices for food and non-alcoholic beverages rose 5.6%, down from the rise of 7.0% in June, with dairy and related products rising12.7% and bread & cereal products rising 9.9% even if fruit & vegetables fell by -2.9%.


The actual pain of cost of living pressures are of course rarely mentioned by the Reserve Bank of Australia or the statisticians.



Australian Bureau of Statistics (ABS), media release, 4 September 2023:


Household spending was 0.7 per cent lower when compared to July last year, according to figures released today by the Australian Bureau of Statistics (ABS).


Robert Ewing, ABS head of business statistics, said households have curbed their spending over the past 12 months amid higher interest rates and inflation.


This is the first time since February 2021 that the spending indicator has fallen.


Spending on discretionary goods and services was down for the fourth straight month. It fell 3.3 per cent over the year, as households adapt to cost of living pressures.


Non-discretionary spending rose 1.7 per cent, which is the lowest growth rate since early 2021.”



The Sydney Morning Herald, 4 September 2023:


The largest fall in spending on goods including clothing, footwear and home furnishings since the start of the Delta wave of the pandemic has bolstered the case for the Reserve Bank to hold interest rates steady for a third consecutive month.


Outgoing RBA governor Philip Lowe will on Tuesday helm his last meeting of the board, which is widely expected by economists to keep the official cash rate at 4.1 per cent as the economy continues to show signs of slowing and inflation pressures ease.




 

Tuesday 6 June 2023

"Eat The Rich" is an amusing conversational tag. But for how long?


For most Australians, income is the most important resource they have to meet their living costs. However, reserves of wealth can be drawn upon to maintain living standards in periods of reduced income or substantial unexpected expenses. Considering income and wealth together helps to better understand the economic wellbeing or vulnerability of households.”

[Australian Bureau Of Statistics, Household Income and Wealth, Australia, Reference period: 2019-20]


Given the grumbling coming from the opera boxes and dress circle seats in the Australian economy if it is suggested that those on low to middle incomes shouldn’t be solely responsible for fighting inflation by way of wage suppression, ever rising cost of living & below poverty line unemployment benefits, perhaps it’s time to remember some of the cream within the Top 1% and how richly they live in an Australian population of est. 26,510,186 men, women and children spread out across this country. [ABS, Population Clock, 4 June 2023 at 8:15am]


Forbes, Australia’s 50 Richest 2023, 15 February 2023:


NAME          NET WORTH          INDUSTRY


1. Gina Rinehart   $30.6 B         Metals & Mining

2. Andrew Forrest   $21.7 B      Metals & Mining

3. Harry Triguboff     $15.5 B    Real Estate

4. Bianca Rinehart & siblings   $12.5 B   Metals & Mining

5. Anthony Pratt   $11.6 B        Manufacturing

6. Mike Cannon-Brookes  $10.8 B Technology

7. Scott Farquhar   $10.6 B      Technology

8. Cliff Obrecht & Melanie Perkins   $7.2 B Technology

9. Frank Lowy   $6 B                 Finance & Investments

10. Richard White   $5.4 B        Technology

11. John, Alan & Bruce Wilson   $5.1 B Fashion & Retail

12. Kerry Stokes   $4.2 B          Diversified

13. John Gandel   $3.5 B          Real Estate

14. Lindsay Fox   $3.4 B           Logistics

15. Jack Cowin   $3.35 B          Food & Beverage

16. Michael Hintze   $3.2 B       Finance & Investments

17. James Packer   $2.8 B        Finance & Investments

18. Lang Walker   $2.7 B           Real Estate

19. Fiona Geminder   $2.6 B     Manufacturing

20. Brett Blundy   $2.45 B         Fashion & Retail

21. Solomon Lew   $2.3 B         Fashion & Retail

22. Bob Ell   $2.25 B                  Real Estate

23. Len Ainsworth & family   $2.2 B Gambling & Casinos

24. Heloise Pratt   $2.15 B        Manufacturing

25. Clive Palmer   $2.1 B           Metals & Mining

26. Gerry Harvey   $2.05 B        Fashion & Retail

27. Kie Chie Wong   $2 B          Metals & Mining

28. Hains family   $1.95 B         Finance & Investments

29. Cameron Adams   $1.8 B    Technology

30. Chris Wallin   $1.75 B         Energy

31. Terry Snow   $1.61 B           Real Estate

32. Bruce Mathieson   $1.6 B   Real Estate

33. Chris Ellison   $1.59 B        Metals & Mining

34. Angela Bennett   $1.55 B    Metals & Mining

35. Gretel Packer   $1.54 B       Finance & Investments

36. David Teoh   $1.53 B           Telecom

37. Nigel Austin   $1.5 B           Fashion & Retail

38. Tony & Ron Perich   $1.42 B   Real Estate

39. John Van Lieshout   $1.41 B   Real Estate

40. Anthony Hall   $1.4 B          Technology

41. Jack Gance & family   $1.35 B   Fashion & Retail

42. Mario Verrocchi & family   $1.34 B   Fashion & Retail

43. Sam Hupert $  1.3 B           Technology

44. Sam Tarascio   $1.25 B       Real Estate

45. Sam Kennard & siblings   $1.2 B  Real Estate

46. Michael Heine   $1.19 B      Finance & Investments

47. Manny Stul   $1.18 B           Manufacturing

48. Mark Creasy    $1.02 B        Metals & Mining

49. Alan Rydge    $1 B              Media & Entertainment

50. Kerr Neilson    $960 M        Finance & Investments


Globally only Monaco and Switzerland have higher individual net wealth than Australia. In this country in 2022 the Top 1% had individual wealth beginning at $5.5 million to >$30 billion, yet before it was driven from office the Morrison Coalition Government locked in an overly generous permanent tax cut for the wealthy in our society. Along with a negative gearing regime for property investment which is concentrating residential property ownership in the hands of richer individuals and families.


While the bottom wealth percentiles - including the homeless, unemployed, working age poor & elderly without assets or savings - recognising the taxation rate/negative gearing sleight-of-hand involved are left wondering how long they can manage to put a roof over their heads and food on the table now and into the foreseeable future.


IMAGE: Twitter via @MaggieDaWitch
4 June 2023



Thursday 9 March 2023

RBA Governor Lowe set to meet with Suicide Prevention Australia after indications there is a surge in people reporting elevated distress over cost-of-living pressures

 


The 10th consecutive cash rate rise announced by the Reserve Bank of Australia has low income and middle income Australia reeling.


Post, a daily newsletter from The Saturday Paper, from the pen of the Emails Editor, 8 March 2023, excerpt:


RBA governor Philip Lowe has announced a record 10th consecutive interest rate rise, but signalled the run may be coming to an end amid concerns the hikes are hurting wellbeing.


What we know:


  • The RBA increased rates by 25 basis points at the board's March meeting, to 3.6% — the highest interest rate since May 2012 (Nine);


  • Mortgage holders with a balance of $750,000 will pay an extra $121 a month — and are now likely paying about $18,900 more in repayments annually since May (realestate.com.au);


  • Lowe’s language softened on the prospect of future rate rises however, with economists suggesting there might only be one or two left (AFR $);


  • He is set to meet representatives of Suicide Prevention Australia, the peak body that has raised the alarm about a surge in people reporting elevated distress over cost-of-living pressures (The Age);


  • Research by Suicide Prevention Australia, given to Lowe late last week, shows 46% of people are reporting high levels of cost-of-living distress;


  • There has also been a lift in the number of people reporting serious thoughts of suicide, which reached 16%, with sharp increases in NSW and Victoria;


  • Lowe will give further clues as to the RBA’s plans in a speech about inflation and recent economic data to a business conference today (Canberra Times);


  • The RBA governor has previously warned of a wage-price spiral driving inflation, though wage growth has been slowing, while corporate profits are surging (The Saturday Paper).



BACKGROUND


Reserve Bank of Australia

Media Release

Statement by Philip Lowe, Governor: Monetary Policy Decision


Number 2023-07

Date 7 March 2023


At its meeting today, the Board decided to increase the cash rate target by 25 basis points to 3.60 per cent. It also increased the interest rate on Exchange Settlement balances by 25 basis points to 3.50 per cent.


Global inflation remains very high. In headline terms it is moderating, although services price inflation remains elevated in many economies. It will be some time before inflation is back to target rates. The outlook for the global economy remains subdued, with below average growth expected this year and next.


The monthly CPI indicator suggests that inflation has peaked in Australia. Goods price inflation is expected to moderate over the months ahead due to both global developments and softer demand in Australia. Services price inflation remains high, with strong demand for some services over the summer. Rents are increasing at the fastest rate in some years, with vacancy rates low in many parts of the country. The central forecast is for inflation to decline this year and next, to be around 3 per cent in mid-2025. Medium-term inflation expectations remain well anchored, and it is important that this remains the case.


Growth in the Australian economy has slowed, with GDP increasing by 0.5 per cent in the December quarter and 2.7 per cent over the year. Growth over the next couple of years is expected to be below trend. Household consumption growth has slowed due to the tighter financial conditions and the outlook for housing construction has softened. In contrast, the outlook for business investment remains positive, with many businesses operating at a very high level of capacity utilisation.


The labour market remains very tight, although conditions have eased a little. The unemployment rate remains at close to a 50-year low. Employment fell in January, but this partly reflects changing seasonal patterns in labour hiring. Many firms continue to experience difficulty hiring workers, although some report a recent easing in labour shortages. As economic growth slows, unemployment is expected to increase.


Wages growth is continuing to pick up in response to the tight labour market and higher inflation. At the aggregate level, wages growth is still consistent with the inflation target and recent data suggest a lower risk of a cycle in which prices and wages chase one another. The Board, however, remains alert to the risk of a prices-wages spiral, given the limited spare capacity in the economy and the historically low rate of unemployment. Accordingly, it will continue to pay close attention to both the evolution of labour costs and the price-setting behaviour of firms.


The Board recognises that monetary policy operates with a lag and that the full effect of the cumulative increase in interest rates is yet to be felt in mortgage payments. There is uncertainty around the timing and extent of the slowdown in household spending. Some households have substantial savings buffers, but others are experiencing a painful squeeze on their budgets due to higher interest rates and the increase in the cost of living. Household balance sheets are also being affected by the decline in housing prices. Another source of uncertainty is how the global economy responds to the large and rapid increase in interest rates around the world. These uncertainties mean that there are a range of potential scenarios for the Australian economy.


The Board’s priority is to return inflation to target. High inflation makes life difficult for people and damages the functioning of the economy. And if high inflation were to become entrenched in people’s expectations, it would be very costly to reduce later, involving even higher interest rates and a larger rise in unemployment. The Board is seeking to return inflation to the 2–3 per cent target range while keeping the economy on an even keel, but the path to achieving a soft landing remains a narrow one.


The Board expects that further tightening of monetary policy will be needed to ensure that inflation returns to target and that this period of high inflation is only temporary. In assessing when and how much further interest rates need to increase, the Board will be paying close attention to developments in the global economy, trends in household spending and the outlook for inflation and the labour market. The Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that.



Friday 10 February 2023

Reserve Bank of Australia raises the interest rate yet again - promising more of the same in coming months. Recession worries begin to emerge

 

On the 7 February 2023 the Reserve Bank of Australia (RBA) increased the official cash rate by 0.25%. The current official cash rate as determined the RBA is now 3.35%.


As we reach the ninth official cash rate rise since 4 May 2022, the Reserve Bank Governor’s words set out below are less and less reassuring.


According to the Australian Stock Exchange (ASX) RBA Rate Tracker:


As at 8 February, the ASX 30 Day Interbank Cash Rate Futures March 2023 contract was trading at 96.525, indicating a 65% expectation of an interest rate increase to 3.60% at the next RBA Board meeting.


The next RBA Board meeting and Official Cash Rate announcement will be on the 7th March 2023.


Reserve Bank of Australia

Media Release

Statement by Philip Lowe, Governor: Monetary Policy Decision


Number 2023-04

Date 7 February 2023


At its meeting today, the Board decided to increase the cash rate target by 25 basis points to 3.35 per cent. It also increased the interest rate on Exchange Settlement balances by 25 basis points to 3.25 per cent.


Global inflation remains very high. It is, however, moderating in response to lower energy prices, the resolution of supply-chain problems and the tightening of monetary policy. It will be some time, though, before inflation is back to target rates. The outlook for the global economy remains subdued, with below average growth expected this year and next.


In Australia, CPI inflation over the year to the December quarter was 7.8 per cent, the highest since 1990. In underlying terms, inflation was 6.9 per cent, which was higher than expected. Global factors explain much of this high inflation, but strong domestic demand is adding to the inflationary pressures in a number of areas of the economy.


Inflation is expected to decline this year due to both global factors and slower growth in domestic demand. The central forecast is for CPI inflation to decline to 4¾ per cent this year and to around 3 per cent by mid-2025. Medium-term inflation expectations remain well anchored, and it is important that this remains the case.


The Australian economy grew strongly over 2022. The central forecast is little changed from three months ago, with GDP growth expected to slow to around 1½ per cent over 2023 and 2024. The recovery in spending on services following the lifting of COVID restrictions has largely run its course and the tighter financial conditions will constrain spending more broadly.


The labour market remains very tight. The unemployment rate has been steady at around 3½ per cent over recent months, the lowest rate since 1974. Job vacancies and job ads are both at very high levels, but have declined a little recently. Many firms continue to experience difficulty hiring workers, although some report a recent easing in labour shortages. As economic growth slows, unemployment is expected to increase. The central forecast is for the unemployment rate to increase to 3¾ per cent by the end of this year and 4½ per cent by mid-2025.


Wages growth is continuing to pick up from the low rates of recent years and a further pick-up is expected due to the tight labour market and higher inflation. Given the importance of avoiding a prices-wages spiral, the Board will continue to pay close attention to both the evolution of labour costs and the price-setting behaviour of firms in the period ahead.


The Board recognises that monetary policy operates with a lag and that the full effect of the cumulative increase in interest rates is yet to be felt in mortgage payments. There is uncertainty around the timing and extent of the expected slowdown in household spending. Some households have substantial savings buffers, but others are experiencing a painful squeeze on their budgets due to higher interest rates and the increase in the cost of living. Household balance sheets are also being affected by the decline in housing prices. Another source of uncertainty is how the global economy responds to the large and rapid increase in interest rates around the world. These uncertainties mean that there are a range of potential scenarios for the Australian economy.


The Board’s priority is to return inflation to target. High inflation makes life difficult for people and damages the functioning of the economy. And if high inflation were to become entrenched in people’s expectations, it would be very costly to reduce later. The Board is seeking to return inflation to the 2–3 per cent range while keeping the economy on an even keel, but the path to achieving a soft landing remains a narrow one.


The Board expects that further increases in interest rates will be needed over the months ahead to ensure that inflation returns to target and that this period of high inflation is only temporary. In assessing how much further interest rates need to increase, the Board will be paying close attention to developments in the global economy, trends in household spending and the outlook for inflation and the labour market. The Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that.

[my yellow highlighting]


The Sydney Morning Herald, 9 February 2023: 


There is a better than 50-50 chance Australia could fall into recession due to the Reserve Bank’s aggressive increases in interest rates, economists believe, as a growing group of Labor MPs suggest the seven-year term of RBA governor Philip Lowe should not be extended. 


Macroeconomics Advisory chief economist Stephen Anthony said the chance of a recession next year could be as high as 70 per cent due to the impact of the RBA’s high interest rates, coupled with a slowdown in key markets such as China.


Pressure on Lowe has intensified after the RBA pushed interest rates to a 10-year high this week and signalling more than one further increase in coming months. Lowe, whose seven-year term ends on September 17, had signalled in late 2021 that rates would remain on hold until 2024. 


The previous two governors, Glenn Stevens and Ian Macfarlane, both had their terms extended by three years. But with a sweeping review of the central bank due to be finalised and handed to Treasurer Jim Chalmers in late March, there is a growing expectation that Lowe will not stay on beyond September. 


Within the government, there are now open questions about Lowe’s long-term tenure at the bank.....


Monday 19 December 2022

Elon Musk no longer the richest man in the world - seems to be finding it extremely difficult to herd cats

 











Elon Musk has disclosed that he had sold another $3.6 billion worth of Tesla stock. Credit...Matt Rourke/Associated Press. The New York Times, 15 December 2022.



The Saturday Paper, from the pen of the emails editor, 16 December 2022:


Musk loses $100bn in a year


What we know:


  • Musk’s net worth has fallen below that of France’s Bernard Arnault, chairman and CEO of luxury goods maker LVMH (CBS);


  • His wealth has dropped by more than $US100bn this year, more than the GDP of Bulgaria, Croatia, Iceland and Uruguay;


  • Musk this week sold about $US3.6bn in Tesla shares, despite declaring earlier in the year he had no further plans to sell shares (CNBC);


  • It comes as he takes legal action against the holder of a Twitter account that tracks his private jet, and suspends the user, a month after declaring he would allow it to keep running (BBC);


  • Musk has meanwhile allowed a host of contentious fringe figures to rejoin Twitter, apparently including anti-vaxxer Pete Evans (Crikey);


  • As advertisers flee the platform and revenue crumbles, Twitter has reportedly stopped paying rent on offices and is considering not paying severance packages to former employees (New York Times);


  • Musk has sacked more than half of Twitter’s workforce, including reps who oversaw relationships with advertisers, staff in charge of complying with regulations, and a team devoted to enterprise products that brought in hundreds of millions a year (Bloomberg);


  • Musk’s vast borrowing to overpay for the acquisition means he faces $US1.2bn a year in interest payments, at a variable rate, with the first cheque due to the banks at the end of January;…..


The Guardian, 16 December 2022:


A number of prominent journalists who have reported on Twitter and its new chief executive, Elon Musk, appear to have been suspended or banned from the platform.


In a series of evening tweets, Musk wrote that sharing his real-time location on Twitter was forbidden, and accused journalists who he alleged had been sharing information about his location of posting “assassination coordinates”.


Accounts of tech journalists at CNN, the Washington Post, Mashable and the New York Times were suspended in quick succession on Thursday evening. All had recently published articles about Musk’s suspension of a Twitter account that had shared publicly available data about the movements of his private jet. Each of these articles had highlighted the tension between Musk’s stated commitment to “free speech” and his choice to ban an account that he personally disliked.


The Twitter account for rival social media company, Mastodon – which some Twitter users have migrated to after Musk’s takeover of Twitter – also appeared to have been suspended.


Links to individual Mastodon accounts also appeared to be banned. An error message notified some users that links to Mastodon had been “identified” as “potentially harmful” by Twitter or its partners.


Ryan Mac, a New York Times tech reporter, wrote on a new Twitter account that he was given “no warning” before his account was suspended and that he had received no communication from the company about the reason his account was “permanently suspended”…..


Read the full article here.


Musk or one or more of his companies appear to have been involved in an impressive amount of litigation, according to Wikipedia and, on 16 December Bloomberg Law reported:


Twitter Inc. has parted ways with Regina Lima, its former head of international legal and sole remaining deputy general counsel, as Elon Musk continues to overhaul the embattled social media company.


Lima’s departure—confirmed by four sources familiar with Twitter’s operations—comes as the company nears the two-month mark of Musk’s turbulent takeover.


Lima didn’t immediately respond to a request for comment. She was based in Miami before being summoned to Twitter’s San Francisco headquarters last week.


Most of Twitter’s roughly 200-employee legal staff has either been laid off, resigned, or otherwise departed during that time. The reductions in force come as the company copes with a variety of legal and regulatory entanglements.....


Friday 9 December 2022

NATIONAL ACCOUNTS DECEMBER 2022: with almost 9 years of the Abbott-Turnbull-Morrison Government mismanagement to reverse there is good news and not so news in the numbers

 

 Australian Bureau of Statistics, 12 things to know about the Australian economy right now, 7 December 2022:

Source





The Australian Economy - September quarter 2022


  1. Our economy grew 0.6 per cent during the September quarter 2022, and 5.9 per cent compared to last year. This was the fourth consecutive quarter of growth since the COVID-19 Delta variant lockdowns. Household consumption drove the increase, growing 1.1 per cent.
  2. We spent more and saved less. The household saving rate continued to fall reaching pre-pandemic levels. Households saved 6.9 per cent of their income during the quarter, compared to 6.8 per cent in the December quarter 2019.
  3. Consumer prices rose 1.8 per cent during the September quarter 2022 and 7.3 per cent compared to last year. This was the fastest annual increase since 1990. The major drivers of consumer price increases during the quarter were in housing, gas and furniture.
  4. Wage growth continued to trail inflation but showed signs of strengthening in response to tight labour market conditions. The unemployment rate for the month of September was 3.5 per cent. Compensation of employees rose 3.2 per cent, which was the highest quarterly rise since December quarter 2006. The private sector wage price index rose 1.2 per cent in the September quarter 2022, the highest rate of growth since September quarter 2010. Compared to a year ago, private sector wages rose 3.4 per cent, the highest annual rate of growth since December quarter 2012.
  5. We continued re-engaging with the world. In the first full quarter of relaxed international travel restrictions, spending on overseas trips grew 58 per cent. International travel reached 56 per cent of pre-pandemic levels as holidays returned to our lives.
  6. Airlines soared. With pent-up demand, activity in the air transport industry rose 25.2 per cent. The construction industry was strong on the back of major engineering and infrastructure projects, and rose 2.3 per cent. Coal mining activity has fallen for four quarters in a row.
  7. Domestic mobility increased. Household purchases of transport services rose 13.9 per cent, reaching 70 per cent of pre-pandemic levels. We purchased more cars as supply bottlenecks began to ease and imports rose. Catering and accommodation services also grew by a strong 5.5 per cent with increased tourism and mobility.
  8. Our exports rode on the sheep’s back. While wet weather hampered exports of coal, rural exports surged 9.8 per cent, led by wool and cotton. Imports of communications equipment rose 5.7 per cent as new mobile phone models became available.
  9. Exports were supercharged by lithium. Our lithium concentrates exports reached a value of $3.4 billion this quarter and was up six-fold through the year. Lithium has surged into Australia’s top 10 export commodities.
  10. Private business investment rose 2.5 per cent led by an increase in infrastructure building. Home-building activity rose 3.4 per cent following an uptick in building approvals, a moderation of labour and material shortages, and an improvement in weather conditions. Government construction fell as quarantine facilities in Queensland and Western Australia were completed.
  11. Profits of financial corporations rose 4.9 per cent during the quarter. Rises in the cash rate during the quarter saw lenders tending to pass on rate increases on loans more quickly than on deposits. This was the fastest growth in financial profits since September quarter 2008.
  12. The current account returned to deficit for the first time since March quarter 2019 as corporate profits went overseas. Mining profits fell 7.1 per cent during the quarter due to weaker commodity prices.

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It should be noted that since the aforementioned data was compiled the Reserve Bank of Australia has raised the cash target rate three times - to 2.60% in October, 2.85% in November and 3.10% in December 2022.  Resulting in the September wage price index rise for the private (1.2%) and public (0.6%) sectors falling further below cost of living increases which stood at a rise of 7.3% over the 12 months to September Quarter 2022.

According to the ABS, in 2022 annual CPI inflation reached its highest level in 20 years.

The Monthly Cost Price Index (CPI) for September showed that the most significant price rises were Housing (+10.3%), Food and non-alcoholic beverages (+9.6%) and Transport (+6.8%).

While the monthly CPI indicator rose 6.9% in the twelve months to October 2022, with the most significant price rises occurring in Housing (+10.5%), Food and non-alcoholic beverages (+8.9%) and Transport (+7.4%). New dwelling prices appear to be driving the increase in housing costs.

BACKGROUND

In Australia in April 2022 cash rate target/market interest rate was 0.1% - a percentage point it had been held at by the Reserve Bank since November 2020.

In May 2022 the rate rose to 0.35%; in June to 0.85%; in July to 1.35%, in August to 1.85%; in September to 2.35%; in October to 2.60%; in November to 2.85%; and finally, in December to 3.10%.

The headline inflation rate by October 2022 was est. 6.9%.

Sometime in January-March 2023 cash rate target/market interest rate is predicted to be at 3.60% & perhaps even 3.85% by May 2023.

In 2022 the Consumer Price Index (CPI) rose 2.1 per cent in the March 2022 quarter; rose 1.8 per cent in the June 2022 quarter and rose 1.8 per cent again in the September 2022 quarter.