Olivers Insights
An excellent overview of 2012 and a refreshingly bold attempt to map out the next twelve months, by AMP Capital's Dr Shane Oliver. Take a close look at the table of investment returns and forecasts. Enjoy! Rick Maggi
05/12/12: RBA cuts cash rate to 3%
But the song remains the same
While the RBA once again loosened monetary policy in December, the Bank continues to see a silver lining on every economic cloud and is yet to acknowledge that the Australian economy is entering a much more difficult environment now that mining investment has peaked. While many believe that the RBA will ultimately be forced to cut the cash rate to 2%, it seems pretty clear that the RBA still remains hopeful that the rate cuts it has already undertaken will be sufficient to revive growth. As such, it appears that until there is irrefutable proof that mining investment has peaked, or that unemployment is rising sharply, the RBA will remain a reluctant rate cutter, as indeed it has been over the past year. Rick Maggi Update: Since the 25 basis point cut yesterday, most of the major banks have since cut their loan rates by about 20 basis points.
06/11/12: Rates on hold in November
Interest rates left on hold for now
The Reserve Bank has elected to leave official interest rates on hold at 3.25 per cent, defying economists bets on a Cup Day cut. A survey of 27 economists by financial news service Bloomberg had 20 tipping a rate cut. However, the RBA has elected to break a six-year streak of moving interest rates on the first Tuesday in November.
The decision keeps the cash rate just above a low of 3 per cent that it dropped to in 2009 during the peak of the economic fallout from the Global Financial Crisis. The general view is that the RBA, always vigilant to fight off inflationary pressures, is taking a wait and see approach as the US economy slowly recovers and China's economy begins to stabilise.
Australia now has the highest interest rates of anywhere in the developed world. While lower interest rates would be a welcome development for borrowers, retirees will benefit from today's decision. But it's also important to note that very low rates is a sign that conditions have deteriorated - never a good thing So i think today, along with the Melbourne Cup, is a good day to celebrate.
16/10/12: Managing super in challenging times
Your questions answered...
The last few years since the GFC have been difficult for investors - each time share markets take a step forward, changes in the global economy pull them back. Paul Clitheroe joins AMP Capital's Dr Shane Oliver to provide their views on where share markets are placed and how to navigate the period ahead. Also included is a link on the Eurozone (easy reading). Enjoy. Rick Maggi.
25/10/12: What does the US election mean for markets?
Dr Shane Oliver discusses forthcoming US elections...
The US elections are only a few short weeks away and the polls have Mitt Romney and Barack Obama neck and neck. This video explores the potential consequences of either a Romney or an Obama win. Watch video here
02/10/12: RBA cuts interest rates
25 basis point cut...
The Reserve Bank has cut interest rates by 25 basis points, taking the official cash rate to 3.25 per cent. More here. Rick Maggi
19/09/12: Q&A on QE3
What is it? Why do it?
AMP Capital's Dr Shane Oliver discusses the potential consequences for investors and retirees of the US Federal Reserve's recent decision to commence another round of 'quantitative easing'. This is an easy to understand article, well worth a quick read. Enjoy. Rick Maggi. Read more here.
03/08/12: Will more monetary easing work?
Will Quantitative Easing Mark III be successful?
While recent announcements coming out of the US and the European have been disappointing, there is little doubt that both will need to take extra steps to bolster their economies. When this eventually occurs, will it be as effective? Read more here Rick Maggi.
19/07/12: USA: What on earth is the "fiscal cliff"?
Yet another alarming sound-bite?
In recent weeks, US politicians and economists have been quoting the term 'fiscal cliff' in the media with increasing regularity. The coming fiscal cliff they are referring to would take effect on January 1 2013, after the US elections in November. So what exactly is it? Should Australian investors be worried? Read more here
02/07/12: Europe lives to fight another day
EU: Walking backwards towards integration
Last weeks EU Summit was, in many ways, a surprising success. While the noise going into the meeting was not encouraging, in the end Germany's Angela Merkel 'blinked' and agreed to a variety of measures to spur European growth, protect the Spanish banking system and lower borrowing costs. Markets around the globe are now rallying to the good news, but the road ahead is a long and twisting one. Read more here.
29/06/12: Australian house prices - is the crash upon us?
Where to from here?
New home sales data released today for May by the HIA confirm that the housing market remains chronically weak right now. This article looks at the outlook for Australian house prices. Rick Maggi Read more here
28/06/12: What about the US?
Greek relief for now - but what about the US?
In addition to providing a brief update on Europe, this note (courtesy of AMP Capital) focusses on the US economy, both in terms of the slowdown evident in some economic indicators and the impending fiscal tightening from January 1 next year. Read more here
26/06/12: 7 contradictions in the Euro crisis
It's fixable...
Jim O'Neill, Chairman of Goldman Sachs Asset Management, in his latest issue of Viewpoints looks at 20 contradictions regarding the euro area issues. Here are 7 key contradictions... Read more here
26/06/12: Alert: 30% Health Insurance Rebate
Pay your health insurance in advance and save...
Please note that the Government is applying an income test to the current 30 per cent rebate it gives us on our private health insurance. That means higher income earners (singles earning over $84,000 and households earning over $164,000) will be progressively slugged up to 30% more on their health insurance from next Monday.
However, the ATO allows you to prepay your health insurance for the next financial year (as long as you do it before the end of the week) which effectively means you can lock in the rebate, potentially saving you thousands of dollars. Rick Maggi Try HBF Rebate calculator here
25/06/12: End of financial year checklist
Plan for the year ahead...
With June 30 fast approaching, now is a good time to review your portfolio and plan for the year ahead. And this year, there are a few time sensitive issues surrounding superannuation that you may want to pay particular attention to. Below is a useful checklist which you may want to quickly run through to ensure that you are fully prepared for 2012/13. Rick Maggi EOFY Checklist