canada/australia recession?

[John_doe]

I was reading an article the other day forcasting recession for canada/australia. I was wondering if anyone had info regarding this?

[JadeDragon]

Two very different countries. I've seen a number of articles predicting doom and gloom for Canada but government is cutting civil service jobs and private sector hiring is up last quarter. Banks are sound, immigration continues strong, and if the US mess did not push Canada into recession already, what will?

[John_doe]

Two very different countries. I've seen a number of articles predicting doom and gloom for Canada but government is cutting civil service jobs and private sector hiring is up last quarter. Banks are sound, immigration continues strong, and if the US mess did not push Canada into recession already, what will?

seems to be a pretty solid arguement against it. let me know if you happen to stumble upon some of those articles.

[inflationhawk]

Well Canada and Australia have lots in common too, especially in regard to their natural resources. Australian banks also are major players in SE Asia financial services. While Canada is more directly tied to the US economy, Australia is pretty dependent on China. However, China is heavily dependent on the US consumer so at the end of the day, they're all interrelated. I don't think Canada and Australia will differ greatly in their economies, but I do feel both will have currencies that outperform the US Dollar.

[John_doe]

Well Canada and Australia have lots in common too, especially in regard to their natural resources. Australian banks also are major players in SE Asia financial services. While Canada is more directly tied to the US economy, Australia is pretty dependent on China. However, China is heavily dependent on the US consumer so at the end of the day, they're all interrelated. I don't think Canada and Australia will differ greatly in their economies, but I do feel both will have currencies that outperform the US Dollar.

I would naturally see the canadian dollar outperforming usd in the long term. I have been buying canadian currency for a while now, due to this.

Both have commodity based currencies right?

[inflationhawk]

Well, both countries are rich in natural resources so in that regard they are commodity based, just not literally commodity based.

Australia is huge in the iron ore market...the majority of high rises built in China are sourced with steel from Australia.

[John_doe]

Well, both countries are rich in natural resources so in that regard they are commodity based, just not literally commodity based.

Australia is huge in the iron ore market...the majority of high rises built in China are sourced with steel from Australia.

china is projecting slower growth arent they? would'nt this in turn make australia slow down also?

[inflationhawk]

Yes, that is certainly a risk some people speak of...near term it could happen and I'm sure there will be major bumps in the road for China over the years, but with a longer term perspective some feel China has the best foundation from here for long term prosperity. They have gone through an industrial revolution in China and have become a supplier to the world. When the US went through their industral revolution in the early 20th century it led to several decades of prosperity (with recessions and depression along the way), just like it happened for the British empire before. I'll stay diversified, but certainly will have a strong allocation to China, Australia, and Singapore. I bought the dip in 2008 and intend to hold a long time.

[JadeDragon]

Slow growth in China is like warp speed in North America. I remember looking at the outdoor gear store business there - they were talking about retail sales growth slowing to 40% a year increase. Chinese are not going to stop buying and consuming. They have a taste of the good life and will do anything to get more.