I think the scary part Martin is that on the news the actually admitted about $600 decline in wages which as you would know when you adjust for inflation is actually worse.
We have had 20 continuous years of positive inflation, many of those years above 2%. That's an incredible record and why we are such an expensive nation. This whole idea that we need to constantly have 2-3% future inflation target with stagnant wages is insane. This is what is going to happen..... 1) We are not getting wages growth and so we will cut on spending. 2) That's going to drive inflation lower which will dampen the economy 3) The RBA with their infinite wisdom will cut rates to ZERO thinking this is going to help 4) It wont as people pile into cheap credit for assets (not products and services) creating debt 5) That's means their is no liquidity so the RBA will start QE (That sounds familiar) You need to move people's money FROM locked assets to other parts of the productive economy. Do do that you got to raise rates. The Fed funds has gone from 0.5% in 2016 to 2.5% in 2019 and lit a fire under the economy. You want to see what happens to a country that has been scared to raise rates, look at Japan.
@@Travelingman-1980 I think a reset is exactly what we need. I think the punch bowl needs to be taken away. I think we need to stop giving out cheap credit and binging on debt. The longer we stay here with low rates, its just more of the same.
Low rates are sucking the life out of the economy. Low rates paradoxically reduce spending because there are millions of savers. Lower rates also lead to increased rents for businesses by increasing commercial property prices.
Y User Low interest rates only affects that percentage of people who have savings which is less than a third of the population. For the rest that have to borrow it has meant being able to borrow significantly more. This ultimately means that low interest rates have not meant lower repayments because they have borrowed much more to make up for the lower interest rate. So in effect they are no better off even if they have a million dollar home they have a significantly larger mortgage as well which means bigger repayments for longer, as wages are not growing to make it easier in future years. This means they will be unable to make adequate pension provisions as they have so much debt. Governments have created a pension crisis in future by shrinking returns now and shrinking people’s ability to save significantly at the same time.
@@davidlazarus67 Official figures show roughly 1/3 population have mortgages, 1/3 have homes paid off and 1/3 are renting while saving to buy a home or just trying to get by. Low rates reduces savings income for retirees (a high proportion of the home-owners with no debt) and pushes up house prices and rents for the 1/3 who don't own a home while making it slower to save a deposit which needs to be bigger all the time. So at best, low rates only benefit a minority while punishing the majority.
Yes, the increased borrowing power essentially leads to higher asset prices and debt. Actually, mortgage holders are also around one third of the population I believe, so there are roughly around the same number of savers as mortgage holders.
does he have 5 years experience in XYZ industry, with RSA+RSG or what ever permit/red tape cut, and a "go to attitude"........(the job competition nowadays is retarded)
@@jamesdeegan7365 if only you were joking. That is exactly the unrealistic expectations in many job adverts. Hahah, and no doubt the writers of such ads think they're very clever and important, lol.
it shows the housing boom is all speculative. cheap credit and low interest rates caused the biggest housing boom in australias history whereas wage growth has remain flat completely flat post gfc correction needed badly. even some buyers looking to get into the housing market at its record prices greed at its finest.
Kiyan Riahi When you think that these people should know that it really should be called fraud. Selling something to a person knowing they cannot afford it is not right.
Couldn’t agree more with your title. We have a Buisness and been doing really well but you can see our staff struggling more and more . And yes we pay our staff well or better that they might get elsewhere for the job they do .
Not in a minimum wage type industry . I’d encourage wage earners to have a go at being self employed and then take on a bunch of staff. Would be a wake up call for most to say the least.
Big Australia policy of mass immigration keeping wages stagnant. Check the chart!! 5:18 Rising from 2001 to 2009, Big Australia policy introduced, flat from then on... Thats what happens when you flood the labour market with supply! How hard is this to understand?
So $80.637 (2009) with inflation should be $96,008(2017), but in reality is $80,095 (2017). So $80,095 in 2017 terms with a 19.1% difference is $64,797 in 2009. SO wages are back to 2004-05 levels.
Steve Keene told you why incomes can't increase in part 4 .Also due to what is becoming a miss allocation of capital as we learn to live with high debts and low interest rates .It seems every where you look poor New infrastructure, buildings death traps and roads fall to bits quicker than it took to build them.
@walktheworld I would love to see data on the number of people either holding or dropping private health insurance and private education. Also wonder if the economy impacts the numbers attending university?
@@WalkTheWorldDFA how about including some figures on recurring bills such as vehicle registration and insurance, home and contents insurance, rates, water/ electricity/ gas council tipping fees, also tafe attendance /tafe fees etc?
Exactly Martin. This year was the most money my family has earned combined. Yet we have hardly made any head winds in savings. Everything goes on utility bills house loan food car costs insurances. Everything is going up higher than the 2% I'd be lucky to get in my next EBA at work. There has to be a reset sooner than later
Disposable...disposable....what? Income? Since when was there any money to spend on things we wanted and didn’t need! Have you seen the price of toothpaste!
Starving the workforce only results in starving the slaveLords. Generations of demonstrably flawed ideology has resulted in our current economic outcomes.
I have a naive question but would love someone to give an opinion. If wages haven’t increased but cost of living has...where does the profit of business go????
Hi Martin. UBS cheif economist noted a material drop on sales volume and 100k jobs in construction at risk.. He also noted that prices likely to rise with relaxed lending and int rate cuts.. Isn't this thinking counterintuitive?
Hi Martin, Consider if you would an interview with Mario from Maneco64 in the UK , Lynette was a great insight one & this guy is along the lines of your videos. Always good to get outside views as Brexit is the straw for us in November I believe Thanks G
I love it how you say at the end, "That's one simple reason why mortgage stress continues to rise" Honestly that was pretty complicated to me..Thanks for helping me and others to understand more about these things..
Hi Martin. Love your channel and work, very insightful. A general comment about a possible data set to look into. The increase in job advertisments for financial counsellors...... obviously correlated with morgage stress.
The demand is Sydney is insane the house prices are double or triple any other place i guess due to the beaches and the harbour bridge plus the employment opportunities are greater than other cities in Australia. I guess some areas in Sydney are reserved only for the Wealthy People.
passing in 2023 on your analysis (the stagnation of income since 2009) I realize that you had already identified the trend in 2019, my congratulations( the same in EURO Europe and in UK)
This was a report on average incomes. I'd like to see the distribution of that stagnant household income. I think households in the bottom half have gone substantially backwards and small gains have occurred in the uppper 20%. The middle 30% has been stagnant. That's only my guess. A formal distribution analysis would be most welcome.
Pavl Rakopv That is how statistics lie to you. The average will be dragged up significantly by a few higher earners. It is like the deposit protection limits. They are many multiples of median savings. You could easily lower the level of protection to as low as AUD5000 and you would still protect half the population completely.
Great insight Martin thank you. And yet the government are still trying to push first home buyers with low deposits into a life of high debt.....I’m a single person and cost of living is getting harder for sure....I’m looking to buy first chance I get so I can actually reduce my outgoings by putting down large deposit. Not decided where yet but it won’t be Melbourne where I currently live.
Time to abolish all the perks the Governor General enjoys, and force him to start paying taxes like everyone else. Also, remove the guarranteed $300K per year income for life, following the completion of their 5 year term.A nice cushy non productive "job for the boys" that achieves SFA.
As they are bringing in more people on 457 visas to take Aussie Jobs maybe we can also bring some over to do our politicians jobs at a fraction of the cost of these current paracites.
Could you consider doing an interview with Mario Maneco64 in the UK, he is very aligned with your thinking & getting outsider input is valuable as Brexit will be the trigger for it all starting in earnest in November, he is a practical guy ... we are going down but 1 x little hiccup from external influence will seal it even faster. Thanks G
With Automation , Robots, mass immigration that floods the market with cheap labor, Artificial Intelligence soon expected to replace some professional jobs (lawyers, accountants) forget about disposable income and wage growth
It would be nice if we could get the cops onto illicit debt peddlers. Any Brexit predictions? Will he actually do it? Or more can kicking there too? I think so, that looks like a big black swan and a half if it did happen.
Get women out of the workforce, salaries rise 2X due to supply and demand, people can actually focus on starting families. Instead of raising children women have been convinced that they need to find fulfilment in that 'career' in HR shuffling papers and maybe have a kid at 35 if it's not too late.... way to go.... "Girl Power" .
@@karl4834 My missus enjoys driving and a day in the life of her career includes 3 hours of driving sandwiched around an 8-6 session of rewarding engagement trying to make somebody else's business a better profit. When she gets home she's exhausted but how lucky is she to spend her entire day fulfilling her dreams. It's certainly improved for women since Dolly Parton sang 9-5.
@@angusmac4482 Great to hear she is enjoying her choices in life. You do realise my comment was recognising that Wrong Think's post was controversial, though? Even though it would appear most the commentators on this site seem to be male, Wrong Think's post is a somewhat antiquated viewpoint that I anticipated would elicit some push-back from both sexes. Eh, the day's still young...
2009, yep it's the lost decade and I don't see there being an upward turning point unless we see a structural shift in the economy. HILDA is absolute gold BTW but yes, DFA survey is larger and more comprehensive. You should munge the two datasets, make it HILDFA!
@WalkTheWorld Have you seen the story below? Do you think this is just a one-off or a sign of things to come? Angry tradies claim developer owes them thousands | A Current Affair | th-cam.com/video/PIYj5NR5sd4/w-d-xo.html
Thanks to those who pointed out I was 10 years out on the title - now corrected... Podcast edition at: episodes.castos.com/dfa/Hilda-2019.mp3
I think the scary part Martin is that on the news the actually admitted about $600 decline in wages which as you would know when you adjust for inflation is actually worse.
@Bogdan Sikorski WTF, we do not care.
Need to redo the title to 2009. not ..19 as we are not finished with 19 yet. 😉🥴
Thanks - my bad - corrected.
@@WalkTheWorldDFA Unfortunately, the video shows 2019... sigh...
We have had 20 continuous years of positive inflation, many of those years above 2%. That's an incredible record and why we are such an expensive nation.
This whole idea that we need to constantly have 2-3% future inflation target with stagnant wages is insane.
This is what is going to happen.....
1) We are not getting wages growth and so we will cut on spending.
2) That's going to drive inflation lower which will dampen the economy
3) The RBA with their infinite wisdom will cut rates to ZERO thinking this is going to help
4) It wont as people pile into cheap credit for assets (not products and services) creating debt
5) That's means their is no liquidity so the RBA will start QE (That sounds familiar)
You need to move people's money FROM locked assets to other parts of the productive economy.
Do do that you got to raise rates. The Fed funds has gone from 0.5% in 2016 to 2.5% in 2019 and lit a fire under the economy.
You want to see what happens to a country that has been scared to raise rates, look at Japan.
@@Travelingman-1980 I think a reset is exactly what we need. I think the punch bowl needs to be taken away. I think we need to stop giving out cheap credit and binging on debt. The longer we stay here with low rates, its just more of the same.
Low rates are sucking the life out of the economy. Low rates paradoxically reduce spending because there are millions of savers. Lower rates also lead to increased rents for businesses by increasing commercial property prices.
Y User Low interest rates only affects that percentage of people who have savings which is less than a third of the population. For the rest that have to borrow it has meant being able to borrow significantly more. This ultimately means that low interest rates have not meant lower repayments because they have borrowed much more to make up for the lower interest rate. So in effect they are no better off even if they have a million dollar home they have a significantly larger mortgage as well which means bigger repayments for longer, as wages are not growing to make it easier in future years. This means they will be unable to make adequate pension provisions as they have so much debt. Governments have created a pension crisis in future by shrinking returns now and shrinking people’s ability to save significantly at the same time.
@@davidlazarus67 Official figures show roughly 1/3 population have mortgages, 1/3 have homes paid off and 1/3 are renting while saving to buy a home or just trying to get by. Low rates reduces savings income for retirees (a high proportion of the home-owners with no debt) and pushes up house prices and rents for the 1/3 who don't own a home while making it slower to save a deposit which needs to be bigger all the time.
So at best, low rates only benefit a minority while punishing the majority.
Yes, the increased borrowing power essentially leads to higher asset prices and debt. Actually, mortgage holders are also around one third of the population I believe, so there are roughly around the same number of savers as mortgage holders.
Disposable income, what's that!? The cost of everything is increasing everyday!
Will need to send my 5month out to work soon!
does he have 5 years experience in XYZ industry, with RSA+RSG or what ever permit/red tape cut, and a "go to attitude"........(the job competition nowadays is retarded)
@@jamesdeegan7365
Yea I hear ya.... The system is corrupt and stuffed
@@jamesdeegan7365 if only you were joking. That is exactly the unrealistic expectations in many job adverts. Hahah, and no doubt the writers of such ads think they're very clever and important, lol.
@@karl4834 I am currently living and working overseas. What the hell will I be coming back to in 7 or 8 years time?
@@karlcotleanu4144 I shudder to think.
it shows the housing boom is all speculative. cheap credit and low interest rates caused the biggest housing boom in australias history whereas wage growth has remain flat completely flat post gfc correction needed badly. even some buyers looking to get into the housing market at its record prices greed at its finest.
Kiyan Riahi When you think that these people should know that it really should be called fraud. Selling something to a person knowing they cannot afford it is not right.
@@davidlazarus67 you are right.
Couldn’t agree more with your title. We have a Buisness and been doing really well but you can see our staff struggling more and more . And yes we pay our staff well or better that they might get elsewhere for the job they do .
Not in a minimum wage type industry . I’d encourage wage earners to have a go at being self employed and then take on a bunch of staff. Would be a wake up call for most to say the least.
Big Australia policy of mass immigration keeping wages stagnant. Check the chart!! 5:18 Rising from 2001 to 2009, Big Australia policy introduced, flat from then on...
Thats what happens when you flood the labour market with supply! How hard is this to understand?
So $80.637 (2009) with inflation should be $96,008(2017), but in reality is $80,095 (2017). So $80,095 in 2017 terms with a 19.1% difference is $64,797 in 2009. SO wages are back to 2004-05 levels.
@MrFourkinghell Gummy lol, I hear they exclude a lot of things from inflation, so the rate is invalid.
i think description should read .... stalled since 2009!
Steve Keene told you why incomes can't increase in part 4 .Also due to what is becoming a miss allocation of capital as we learn to live with high debts and low interest rates .It seems every where you look poor New infrastructure, buildings death traps and roads fall to bits quicker than it took to build them.
productivity is being stolen by the corporates.
Hilda sounds like she's doing it tough like us all
@walktheworld I would love to see data on the number of people either holding or dropping private health insurance and private education. Also wonder if the economy impacts the numbers attending university?
Have that data, when I have time I will post it...
@@WalkTheWorldDFA how about including some figures on recurring bills such as vehicle registration and insurance, home and contents insurance, rates, water/ electricity/ gas council tipping fees, also tafe attendance /tafe fees etc?
Hardly surprising since our production levels have been dropping, a housing bubble is no substitute.
Thanks Martin 👍
Exactly Martin. This year was the most money my family has earned combined. Yet we have hardly made any head winds in savings. Everything goes on utility bills house loan food car costs insurances. Everything is going up higher than the 2% I'd be lucky to get in my next EBA at work. There has to be a reset sooner than later
Disposable...disposable....what?
Income?
Since when was there any money to spend on things we wanted and didn’t need!
Have you seen the price of toothpaste!
Toiletries in general are overpriced in the supermarkets, try The Reject Shop or the like, much cheaper!
And razors. I make mine last months lol
@@item6931 Shave with a DE razor.
It costs a fraction of most cartridge razors.
I did years ago and would never go back.
Make toothpaste from sodium bicarbonate and water for next to nothing and without fluoride...
Starving the workforce only results in starving the slaveLords.
Generations of demonstrably flawed ideology has resulted in our current economic outcomes.
Thank u Martin great update 🎁
I have a naive question but would love someone to give an opinion. If wages haven’t increased but cost of living has...where does the profit of business go????
Kylie there's been no trickle down of profits as has been the trend everywhere instead they buy up or reinvest back into their own business.
Hi Martin. UBS cheif economist noted a material drop on sales volume and 100k jobs in construction at risk.. He also noted that prices likely to rise with relaxed lending and int rate cuts.. Isn't this thinking counterintuitive?
Hi Martin, Consider if you would an interview with Mario from Maneco64 in the UK , Lynette was a great insight one & this guy is along the lines of your videos. Always good to get outside views as Brexit is the straw for us in November I believe Thanks G
I love it how you say at the end, "That's one simple reason why mortgage stress continues to rise" Honestly that was pretty complicated to me..Thanks for helping me and others to understand more about these things..
Hi Martin. Love your channel and work, very insightful. A general comment about a possible data set to look into. The increase in job advertisments for financial counsellors...... obviously correlated with morgage stress.
Yes - especially in the West...
The demand is Sydney is insane the house prices are double or triple any other place i guess due to the beaches and the harbour bridge plus the employment opportunities are greater than other cities in Australia. I guess some areas in Sydney are reserved only for the Wealthy People.
passing in 2023 on your analysis (the stagnation of income since 2009) I realize that you had already identified the trend in 2019, my congratulations( the same in EURO Europe and in UK)
Thanks Martin.
This was a report on average incomes. I'd like to see the distribution of that stagnant household income. I think households in the bottom half have gone substantially backwards and small gains have occurred in the uppper 20%. The middle 30% has been stagnant. That's only my guess. A formal distribution analysis would be most welcome.
I know lots of people however i don't know one household that has anything near $80pa... All of them would be way less than $50k... way less.....
Pavl Rakopv That is how statistics lie to you. The average will be dragged up significantly by a few higher earners. It is like the deposit protection limits. They are many multiples of median savings. You could easily lower the level of protection to as low as AUD5000 and you would still protect half the population completely.
@MrFourkinghell Lucky you..
Everything's fine AfterPay and Zippay will make everyting ok again.
Audi e-tron not if visa and MasterCard just offer the same services on top of the current business.
Pretty flimsy at the price of you ask me
@@AlienLivesMatter Yeah, there's always gonna be a market for "I'll just pay it later".
Savings for losers these days everyone knows that. lol
Audi e-tron
www.abc.net.au/news/2019-07-30/more-australian-borrowers-falling-into-mortgage-arrears/11365288
Great insight Martin thank you. And yet the government are still trying to push first home buyers with low deposits into a life of high debt.....I’m a single person and cost of living is getting harder for sure....I’m looking to buy first chance I get so I can actually reduce my outgoings by putting down large deposit. Not decided where yet but it won’t be Melbourne where I currently live.
Move to the Gold Coast. House prices are much cheaper up there, and the climate is great.
Karl Cotleanu it’s definitely an option I’m looking into, GC certainly ticks a lot of boxes 👍
Bring back LOGOS!!!
and all the off the plan stock that was propped up by these fomo/foreign buyers and cheap credit and low interest rates.
More like 1989
More like George Orwell's 1984
Time to abolish all the perks the Governor General enjoys, and force him to start paying taxes like everyone else. Also, remove the guarranteed $300K per year income for life, following the completion of their 5 year term.A nice cushy non productive "job for the boys" that achieves SFA.
As they are bringing in more people on 457 visas to take Aussie
Jobs maybe we can also bring some over to do our politicians jobs at a fraction of the cost of these current paracites.
Martin...Great video....you need some do nothing time.
IN THAT PERIOD what have the PROFITS BEEN?
Because the cost of living is so high n much harder to get a job and that is why modem ppl don’t want to have kids or get married:((
That is two of the reasons there are other too.
Could you consider doing an interview with Mario Maneco64 in the UK, he is very aligned with your thinking & getting outsider input is valuable as Brexit will be the trigger for it all starting in earnest in November, he is a practical guy ... we are going down but 1 x little hiccup from external influence will seal it even faster. Thanks G
OK lest get this right, because we are a 27/7, 365 global economy as long as there are rice paddies to empty wages are never going up.
First!!!!!
Thats dead right i was working till 2019 and all that time i was dept free nothing on hirepurc
👍
With Automation , Robots, mass immigration that floods the market with cheap labor, Artificial Intelligence soon expected to replace some professional jobs (lawyers, accountants) forget about disposable income and wage growth
Hang on, hang on! Martin, you've been to 2029 and wages are STILL flat?! 🤣
Care to share some 'historical' data to guide us to greater prosperity...
It would be nice if we could get the cops onto illicit debt peddlers.
Any Brexit predictions? Will he actually do it? Or more can kicking there too? I think so, that looks like a big black swan and a half if it did happen.
Get women out of the workforce, salaries rise 2X due to supply and demand, people can actually focus on starting families. Instead of raising children women have been convinced that they need to find fulfilment in that 'career' in HR shuffling papers and maybe have a kid at 35 if it's not too late.... way to go.... "Girl Power" .
How are you going to enforce keeping women out of the workforce without having some kind of authoritarian regime?
Boy, am I looking forward to the breadth of commentary you get for this post :-)
I can actually get behind this idea
@@karl4834 My missus enjoys driving and a day in the life of her career includes 3 hours of driving sandwiched around an 8-6 session of rewarding engagement trying to make somebody else's business a better profit. When she gets home she's exhausted but how lucky is she to spend her entire day fulfilling her dreams. It's certainly improved for women since Dolly Parton sang 9-5.
@@angusmac4482 Great to hear she is enjoying her choices in life. You do realise my comment was recognising that Wrong Think's post was controversial, though? Even though it would appear most the commentators on this site seem to be male, Wrong Think's post is a somewhat antiquated viewpoint that I anticipated would elicit some push-back from both sexes. Eh, the day's still young...
ASX200 has hit a ATH. Just waiting for it to crash again!!!!
THIRST!!!......................Jacob's Greek Merlot.
First
@Der Gorghast 😂
💙💚💛🧡 Buy Bitcoin, avoid this trashy Aussie Dollar scam 💙💚💛🧡
O.o
2009, yep it's the lost decade and I don't see there being an upward turning point unless we see a structural shift in the economy. HILDA is absolute gold BTW but yes, DFA survey is larger and more comprehensive. You should munge the two datasets, make it HILDFA!
HILFA, or Hilfe - the German word for HELP.
@WalkTheWorld Have you seen the story below? Do you think this is just a one-off or a sign of things to come?
Angry tradies claim developer owes them thousands | A Current Affair | th-cam.com/video/PIYj5NR5sd4/w-d-xo.html