Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), & CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he's one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written, yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data & charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, author of the New York Times bestsellers 'End Game' & 'Code Red'.

"The level of detail in Pete's work is superlative across all of Australia's housing markets" - Grant Williams, co-founder RealVision - where world class experts share their thoughts on economics & finance - author of Things That Make You Go Hmmm, one of the world's most popular & widely-read financial publications.

"Wargent is a bald-faced realty foghorn" - David Llewellyn-Smith, 'MacroBusiness'.

Wednesday, 7 June 2017

103 quarters of growth

Record stretch

The Australian economy grew by a paltry 0.3 per cent in the March quarter, to expand by 1.7 per cent over the year.

Cyclone Debbie impacted dwelling construction adversely, subtracting 0.3 percentage points from growth, while net exports were also impacted. 

Growth was experienced across 17 of 20 industries, led by finance and insurance, wholesale trade, and healthcare and social assistance, but this was offset by quarterly declines in manufacturing and agriculture.

At the state level there were strong increases in final demand in Victoria (1.4 per cent) and South Australia (1.1 per cent) in the quarter, while Tasmania was also in positive territory (0.9 per cent).

Final demand was flat in New South Wales and Queensland. 

The weak headline result pulls the annual GDP growth rate down to 1.7 per cent, while on a per capita basis annual growth in the economy has all but slowed to a halt in real terms.

The news in the first quarter of the year was far from all bad - notably, the terms of trade surged by 6.6 per cent to be miles above the long run average.

And, as a result, real national income and real disposable income has surged to record highs.

Unfortunately the boom in the terms of trade will be reversed next quarter, with the iron ore price zooming back down to earth with a thud.

Consumption modest

Household consumption will need to step up a gear.

Compensation of employees did bounce back to rise by 1 per cent in the quarter, while household consumption increased modestly, with the derived saving ratio dropping to 4.7 per cent in the March quarter, the lowest ratio since March 2008.

A mediocre result, overall, but one which means Australia has racked up 103 consecutive quarters since the last technical recession, an incredible run by anyone's reckoning.