Australia – is being called the lucky country – having avoided a recession and an increase in GDP figures for the 2015 calendar year.
Everyone celebrating about GDP growth exceeding expectations in the final quarter 2015 – the Australian Bureau of Statistics (ABS) reported that Australia’s economic growth was a higher-than-expected 0.6 per cent for the December quarter and 3 per cent for the year. (1)
Even BIS Shrapnel – is in on the party (2) stating that – to quote ABC – “Despite a volatile start to the year and a drop in commodity prices, Australia has avoided a recession and looks unlikely to have one…”
Wow – I must have missed something.
This is only the beginning – both China and Japan – the two larger trading partners have huge problems – and as outlined in a previous blog – global trade reducing at apace.
The GDP supported by an increase in consumer spending, construction and mining – funny how all mining companies though – are recording extraordinary losses for the period in question – definitely not sustainable.
Dig deeper – the ‘real’ net national disposable income fell 0.3 per cent during the quarter on this measure, and was down 1.2 per cent for the year, in contrast to a 2.8 per cent trend rise in GDP.
Chart courtesy of the ABS.
Real net national disposable income continued falling, even while GDP headed back towards average growth.
Per capita, this measure of economic wellbeing has now been flat or falling for 16 consecutive quarters (four years), the longest period it has gone backwards since the ABS started calculating the figure in 1973.
As I said – the party is over – far too early to say that we missed a recession – let alone be gullible enough to believe the economists.
With China having to have a depression – Japan having the need to hyperinflate through stupidity – I do not think that we have dodged anything.