MB Radio: A podcast of gloomy disposition

 

With the sheer enormity of the COVID19 pandemic’s economic impact only starting to dawn, David Llewellyn Smith and Leith Van Onselen spoke with Gunnamatta on the major forms the shock has taken through the Australian economy.  Over the course of about 75 minutes (3 parts) they cover the ugly numbers and the dynamics across employment, households, spending and debt serviceability, with implications for wages, real estate, government outlays and the strategic policy implications these encompass.  It isn’t pretty

 

 

 

Comments

    • DodgydamoMEMBER

      Agreed. Intelligent and independent analysis of the dire situation we are in which is largely unavailable elsewhere in Australian media which is why I remain happy to subscribe to MB. However the ongoing levitation of Oz RE and stock prices despite the shock of economic realities remains a source of disbelief and frustration. Just because MB tells it like it is and how it should be doesn’t mean that’s how it plays out, somehow there’s consistently been another means of Oz kicking the can down the road… for more than 12years…possibly 20! Is the nation really, finally, all out of luck this time?

    • I reckon its great.

      Easy to follow, covers all the main themes. A sence of humor and the craziness of what is going on. Thank you guys for assembling it all. I think this sort of commentary and analysis should be in the broader media.

      If we have any customers at the workshop this week, they will be getting an earful!

  1. I guess our political Leaders will make like the parson in the film (Jack Hawkins), and head off at the first sign of trouble – Oh! They already have~(NB: Not a film to be rewatched in these days of BLM)

  2. Anecdote time:
    The daughter of a mate of mine is at Uni and has a part-time job at a multi national retail store – they are present in all the major shopping malls. She was working two shifts a week, a few hours per shift. Covid came along and she qualified for JK – jackpot for her. However, the employer has been demanding she work more hours to fully reflect the larger amount of money she is now taking home under JK, which she has refused to do because of study commitments. Things have turned nasty and there are threats and bullying going on – specifically from the ‘area manager’ who is a nasty piece of work at the best of times.

    She will decide this weekend whether to throw in the towel and the stress of it all is becoming too much.

    • Wont matter soon enough right? Going to become stepped based on your precovid pay?

      This is the thing in aus. The employer cant stand that she is making money for nothing and wants in on the action.. so wants to fire her colleague so he can just pay one person the jobseeker upfront and get the combined hours of two.

      • Yep. Thing is, she’s had a gutful of the way they’re treated her and the relationship has soured to the extent that she thinks she has no choice. She’s thinking about going to FWA to report them, which I hope she does. I suspect there’s plenty of this going on – just another unintended consequence of a govt scheme that wasn’t thought through very well (or very much). *sigh*

        • “just another unintended consequence of a govt scheme that wasn’t thought through very well (or very much). *sigh*”

          Try just another consequence of supply side economics, decades of neoliberalism, survival of the fittest social construct, and government filled with the product of the aforementioned. That a virus has tipped over the cart and exposed all the above for the concocted rubbish it is …. massive galactic dark comedy stuff …

          But yeah make it all out to be a government issue …. when you have the best government money can buy …

          • I didn’t suggest it wasn’t well-intended, skip. Just another example of Govt shooting first and worrying about the consequences afterwards – that’s what they do best. This is a typical consequence where there is zero accountability for actions.

            Even the fellas at MB who are cheerleaders for all manner of intervention know that JK is a sh#t scheme and rail against it on a daily basis. LVO: drop JK and let the cards fall where they may — get people onto JS so we can get a better picture of the true economic damage instead of pretending. (a horribly ‘neoliberal’ thing to think, hey, skip – they should be ashamed!).

          • You must live in an alternate reality because government has been largely privatized over the years and how you mistake Chicago school et al neoliberal economics with anything Keynesian is absurd.

            Just things like the Powell memo and economic libertarianism being a front for big business makes what you say again absurd.

        • Dominic … Don’t let her get bullied ! Just get some video or even some audio of the workplace and threaten them with lawyers (that is the nice way to do it …) Otherwise just get the evidence and then bring in the lawyers …

          • That’s what I reckon. Thing that gets me is the stories of the behaviour of this area manager – how the fck someone like her has a job is beyond me. My wife ‘justifies’ it by saying it’s probably a fairly low paid job and therefore doesn’t attract the cream but even so, her boss should be onto this.

    • Either the government sets the rules and she is free to follow them and collect her $750 a week for a couple of hours work (just like with negative gearing and imputation credit refunds) or she is a rent seeker gaming the system.

      • Hardly gaming the system — she’d have been happy just getting paid what she was before, except her employer didn’t want to pay her, so the JK scheme was the only option. That’s how this scheme works. So her employer is pee’d off because she’s earning more than she was (not at their cost, I should add). It’s just plain envy.

        • Sounds like envy – companies on Jobkeeper where those earning more than the payment are effectively subsidising those who were part time or earning less, so they’ve never been in that position yet have the power to make life difficult for others. Most definitely worth a report to FWA.

      • I was chatting to a mate whose wife works for the State Govt and who recently took a very senior job in a different department and includes a Change Management mandate. Anyway, she’s struggling to get anything done as half the staff are never there – either illness or some other reason, apathy, resistance to change (the Unions’ sole job is to prevent any change from taking place) , and a whole host of other reasons. I hope she gets paid a lot of money for putting up with that shyte – and if she succeeds she should be awarded in the Queen’s Honors List.

        • I shall regale you one day about the resistance I face in getting managers to even consider having their staff member learn a simple new process that confers significant efficiencies for the business, cost savings and improves patient information security. This is in health. “Oh we can’t ask them to do that. “

          Drives me bonkers. Meanwhile I’m teaching myself all sorts of stuff outside my PD to make my output more effective and the business better. Does my head in

          • It frustrates me only because I don’t understand that mentality — I suppose if there’s nothing in it for them then they’d prefer not to rock the boat. Added to which the the phrase ‘efficiency gains’ just sets off alarm bells for their job security.

            Even so, it’s bad for progress and its bad for the taxpayer as resources could be made available for so much more.

        • bolstroodMEMBER

          Your daughter could keep turning up for her shifts as per usual, ignore the bitch as much as she can, collect
          evidence surupticiously, and go to the end of JK. Just drive the manager nuts.
          Good luck to your girl.

      • PaperRooDogMEMBER

        Yes, I never get notifications as there are heaps of Gunnamatta channels on SOundcloud makes it hard to find what we are after on soundcloud and means less subscibers, I’d think. Not sure which are official channels either without clicking through MB website.

        • GunnamattaMEMBER

          sorry the deal with soundclouid is that you get one load up (ie I can load one podcast) for each profile you create – I dont subscribe, so there are a few gunnamattas (not all appear to be me)

  3. Will the RBA be forced to act? Especially if the sharemarket continues to fall. Trump was putting enormous pressure on powell to cut rates and “stop with the 50 bs” last year, could we see similar here?

  4. Where do people see the New Zealand economy going from here? Can it work as a fortress economy? My understanding is selling houses to immigrants is an even bigger part of their economy than Australia s, they dont have the resource exports we do, tourism is a larger share of the economy than Australia s, large share of the better paid Kiwi s work overseas in Aus or elsewhere on a FIFO basis.
    Will they do a proper currency devaluation? What else can they do?

    • They cannot thrive in isolation any more than we can. It’ll all tip into the abyss as soon as the stimulus comes to an end or is tapered — right now there is a lot of money sloshing around creating fake demand and people think it’s Christmas.

    • Arthur Schopenhauer

      The Kiwis went through their first shock in 1972, when Britain joined the EU. Prior to that they had supplied a frozen lamb, cheese etc to the mother country.
      Most Australians don’t realize that personal income is around 2/3 of Australia. (That’s why SE Queensland is the second largest NZ city!)
      There are a bunch of small manufacturers that get by on the smell of an oily rag. Agricultural equipment, yachts, classic car parts, mobile gantries, clothing etc.
      They’ll get by better than Australia, because they’ve been through rolling economic contractions over the last 50 years.
      If they don’t, the Australian constitution has left it open for them to join as a State, anytime! 😀

      • Banana ManMEMBER

        My Nana has showed me the vast swathes of land that they had to hand back cause they couldn’t afford rates. NI NZ

      • Well maybe , in my opinion Kiwis going to work in London or Australia have always cushioned these shocks in the past cant see that this time., the massive urban population growth of the last 15 years isnt going to help.

  5. Ukraine fnMEMBER

    Lucky for you DLS and LVO you have a quarterly chat to try and make sense of all the sh!tf%ckery that goes on. Try having a conversation with the average person about the contents of your podcast is no easy endeavor.
    Lots of “hopium” that things will go back to pre covid , can’t see it myself and the real test will be if the Govt tries to fire up the immigration ponzi again as i can not see any alternative but a massive push back from the populous due to the real unemployment.

    • I think it will be a big question going forward, How politically feasible is opening the gates going to be?
      On one side there is no opposition party to vote for, O.N s record in the senate , tells us they will be useless and merely complain about refugees while ignoring.
      the real issue. (I wonder how many IP s PH owns ?)
      Labor slaves to wokeness. Maybe the PTB will just continue to impose it on us.
      On the other side when people start feeling real financial pain, wages and conditions falling fast instead of just being eaten away by debt and asset inflation, things could get interesting.
      And then along comes a Nigel Farage or Trump style populist,
      Best case scenario its someone from a more economically left and with an inclusive bent. Thats probably not what we will get however.

      • Was reading a report today that 170 Australians are coming back to South Australia from COVID hotspot India. If there are any new cases or outbreaks from this, I’m guessing it will assist the push back against “opening teh gates” for immigration.

  6. Diogenes the CynicMEMBER

    Great podcast as always thanks for the work in putting it together. I agree with your property outlook. But something I’m seeing in Perth the effect of being virus free seems to be drawing a lot of expatriates back and this is definitely having an impact on good family homes in the inner ring, which they seem to be buying. A chap I know pulled his house off when COVID hit in March but then went back onto the market in July with no price listed – had 3 bidding parties on first home open, sold for $50k above the top end of his previous March range. I just sold a second hand fridge to a lady who is buying it for her daughter who is returning from overseas and they are off looking at homes to buy for her. If this is really a thing then being virus free is even more of an advantage and the hard border looks even better as a way to boost the economy. Local tourism went gangbusters here over the holidays as no one could go o/s. Places like Albany which frankly has Melbourne type winter weather was jammed during the July school holidays.

    • I hope all these people coming back are cash buyers because there probably won’t be too many jobs to come back to — except in mining perhaps. Those people buying now will still end up wearing losses IMO. The effects of the Depression have barely begun to be felt. Absolutely none of the stimulus has been wound back yet.

  7. Display NameMEMBER

    Enjoyed the podcast. I have been saying for a while that there is no path through this without a major reset. I cannot see how we get sensible policy until all the vested interests have lost some or a lot and dividing the spoils is no longer the focus, survival is.

  8. will listen to it later.. but without harry on the panel my guess is it will lack depth required to attract serious listeners.

  9. Great podcast, very informative. Especially loved the “idiot optimist” descriptor of the government and RBA. Also like the choice of closing music – has a Reusa bunga bunga party vibe.

  10. Not bad. Not bad at all. A little too nonchalantly dismissive of the importance of resources in carrying the whole shebang of the Oz economy. But de rigueur here. It’s a thing.

    Still waiting for Mig’s 3 handle. As a minor “idiot optimist” not quite as dismal as MB – a decade or more long position.

    On the production front, Gunna sounds like he’s speaking in a barrel. Easily fixed.

    👍

  11. You were wrong before regarding interest rates and you are wrong now with MMT. Zero interest rates are deflationary. Zero interest rates change people’s mindset. Money becomes sounder, and that’s something you don’t want. With zero interest rates, people start to look at how much something costs instead of how much are repayments.
    MMT is not going to work because of one simple reason. Most of that will finish in consumption. None of that funny money will make some new value. Everything will finish in the toilet at the end. Not sure about grammar, but you will understand.
    Ask any Europeans.