WA Treasury advertises for forecaster

WA-mnager-economc-and-revenue-forecasting (1)

Recently WA Treasurer Mike Nahan said:

“I used to do this for a living, predict commodity prices and I’ve listened to a lot of experts saying you should have, you could have predicted this fall,” he said.

“I looked at every forecast when the budget came down last year and we were smack bang in the middle.

“Ask Atlas if they saw [the price drop coming]; ask BHP or FMG. They didn’t. It dropped 65 per cent. That is out largest source of income, and then oil prices got hit. I defy anyone to predict that.

Well, MB did and I know others did too. Not asking conflicted miners would be a good place to start.

Here, free of charge, are the iron ore prices that WA should plug into its forecasts:

  • 2016 $35 per tonne
  • 2017 $30 per tonne
  • 2018 $25 per tonne
  • 2019 $30 per tonne
  • 2020 $35 per tonne

Roughly half the current outlook. And for LNG $7mmBtu for as far as the eye can see.

For growth, Dr Nahan, imagine the absolutely worst number you can and then halve it (or if you’re thinking recession then double it).

That’s my $135k contribution the WA economy. I’m pretty sure I’d be swiftly transferred if I was given the job, which is the real problem.

David Llewellyn-Smith

Comments

  1. Im assuming the numbers are purely imaginary, set to fit in with cabinet’s demands.

    What would happen if there was a sane person working in the treasury? Fired? Ignored? Would they just throw the report in the bin and tell you to start over

    It seems incompetents always rise to the top in Australia

  2. “A particular focus will be to develop econometric skills within the Division”

    What is your plan to get people with a vested interested in appearing deaf to listen and comprehend?

    $135k doesn’t seem anywhere near enough.

    • That’s what I thought too. Not much more than a FIFO worker. Stress levels would be much higher.

      • Less than a FIFO worker. Of course a FIFO worker adds to productive enterprise. A public servant, not so much.

      • ….adds to productive enterprise. A public servant, not so much.

        I was referring to how much you add to productive enterprise, not how much you sold your soul for.

      • Well 3d1k, what do you think lack of professional respect for a Public Servant in that role has cost the State? Millions, perhaps many Millions and perhaps even the big “B”ilions as they sell off assets because of lack of Financial Planning. Australia was rated as having the most efficient public service before a certain Bull in a China shop decided to wreck it. It looks to me as if many of the senior public service managers were better than their private sector counterparts…. and I’ve worked with both.

      • Actually the salary isn’t any different from what you could get working in market research with far less model building expertise. As for FIFO, just because people dig stuff out of the day ground, that is not a proxy for productive use of one’s time, particularly of your future income is in jeopardy. That time and energy might be better invested in learning how to analyze data sets.

    • Econometrics? Oh pshaw!! Wasted enough time in that arena years ago. Not relevant to the modern chaotic old world that we find ourselves in. So 20th century!

  3. Imagine the interview, if the applicant dumped those forecasts on them.
    Be thrown out quicker than you can say “vested interest”

  4. Annoying Devil

    Lol! I like the last requirement….”develop the econometric skills withing the division”. Because obviously they are a pack of dills.

  5. David Flanagan can do it after he’s done flogging the capital raising for Atlas. He’s used to putting lipstick on the pig. The article in AFR on him today shows that he’s getting great practice.

  6. $135K or $149 for that advice.
    Usually for procurement under say 40K depts can buy it without an RFP etc.

  7. http://www.news.com.au/national/breaking-news/mining-service-company-optimistic/story-e6frfku9-1227436999838
    “GLOBAL commodity prices will rise and South Australia’s mining sector has a bright future, a leading mining services company says.

    CAVPOWER, which repairs and maintains heavy machinery for the mining, energy and construction industries, has just opened a $25 million facility in Adelaide.
    Managing director Alistair Cavill says the resource sector remains a cyclical business and global commodity price will rise again in the future.”

    Seems to me they need to contract this company for this role.
    Perfect fit.

    • To be fair, this is probably true. Just not in the near future.

      “…global commodity price will rise again in the future…”

      • Hey if you’d said “The Dow Jones Index will be many times higher than it is today in the future” on October 23, 1929, you’d have been totally correctly.

    • I’d be saying the exact same thing if I had forked out $25M on a new facility as the commodity super cycle starts rolling down-hill.

      Poor feckers…..

  8. Water cannons for the homeless, Fiona Stanley leaking, private detectives for Uber and this. Fook this state!

  9. You should apply for the job anyway – if they bother to send a letter of rejection it might be a doozie!

  10. Not the greatest coin for a short term role. I don’t get out of bed for less than $220k, used to be $300k but the downturn in mining keeps on making me accept less. My role is to forecast things, like when we get FOOS at Roy Hill. PS I don’t work for RHIO……….

      • I’m just kidding, you just have to do what it takes to keep busy and that means taking less money if the alternative is no job. I don’t have any investments to keep me in money Might have to sell a few Harleys and jet skis on Gumtree if things turn to shyte.

  11. Perhaps 3d can do it as a second job, he never lets
    reality interfere with ideology.

  12. Predictably it’s always the same response, “no one could have predicted this.” Always always always.

    • Plenty saw it but they are ignored as they don’t seem to rate by the Media (Keen etc)There’s no reward for getting it right. Besides with these command and control economies of China you could always see the Iron Ore price going back up after a downturn, though since Aug2013 it’s been in a real strong downtrend. Only blind Freddy could see it going up now.

  13. “MB did and I know others did too”

    I believe Goldman called for structural oversupply commencing in 2014 as early as 2008-09. Surely it can’t be this hard. The base case should always be pessimistic, and when prices are raging upward just keep in mind “mean reversion” and you at least won’t get caught with your pants down.

  14. BoomToBustMEMBER

    They cant handle the truth !!

    Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing ever happened – Sir Winston Churchill

  15. MacondoMEMBER

    Just in case you’ve forgotten, Mike Nahan is from the IPA.

    Intelligent Predictive Anal-arse-is

    • He seems to find actual governing far more challenging that sitting on the sidelines throwing rocks.

  16. May I suggest that instead of hiring said economist, the WA and indeed the federal and other state governments would save a lot of money and embarrassment by subscribing to MB. MB has proven itself to be competent in the field of economics. They, on the other hand, have proven themselves to be utter buffoons, as have nearly all of the corporations and mainstream media. Maybe they should also subscribe to MB. In fact, even MB’s posters are arguably more competent than our political and business elites 🙂

  17. Mining BoganMEMBER

    I’ve got no hope seeing as Mr Nahan never even answered the email I sent after his “nobody could have seen this coming” call.

  18. 1. Should ask the WA people…..put it to a referendum. Lol.

    2. …..seriously, closer to 200K would be more in the ballpark imo.

    3. …..apt person to contact is named ‘Christmas’ – before or after?

  19. The Traveling Wilbur

    We should run a pool on what the first budget IO number the new team produces is (for the ensuing financial year). My tip is they plug for 51.83 $US per mt.

  20. M: “I can recommend a friend who’s an economist”
    H: “I have a fascist friend too.”