Business Spectator - World to emerge from crisis in early 2010, IMF chief

A confirmation on timing from IMF:

We expect to get out of the crisis early in 2010, especially if a clean-up of certain segments of the financial system is carried out," IMF managing director Dominique Strauss-Kahn told a conference in Morocco.

Speaking later in a panel discussion, Mr Strauss-Kahn said signs that the effects weighing down the global economy were easing would become clearer in September and October this year, with growth returning early in 2010.

As suggested elsewhere, markets tend to bottom-out six to nine months before the real economy.

Business Spectator - World to emerge from crisis in early 2010, IMF chief

Personal Foreign Exchange - XYLO

Just found another option for foreign exchange and international transfers.

Xylo (link) offers direct debit facility, competitive exchange rates, and charges $5 per international transfer. Xylo is a division of Westpac Banking Corporation.

Personal Foreign Exchange - XYLO

Business Spectator - This rally is all bull - Alan Kohler

More and more economic analysts call the bottom retrospectively, to have happened early March. Eureka Report’s panel of economists states, with 9 analysts out of 10, that market has bottomed out in the first week of March. Most now agree that we have seen the worst. Excluding further disasters, the market indices should not go lower than levels reached two and a half months ago. It is still possible, and quite likely, that market will move lower than the current levels.

This would be a typical phase 1 in the economic cycle. See the phases shown graphically - here. I believe everyone is now expecting to see a higher low, confirming that the decline has definitely ended. And not only that. The higher low would mean that growth is back in the game.

Business Spectator - This rally is all bull - Alan Kohler

Business Spectator - RBA says Aust economy will recover by Xmas

Reserve Bank of Australia governor, Glenn Stevens, stated that Australian economy will start getting better by Christmas but the recovery from recession will be slow.

Treasury forecasts predict the Australian economy will grow by 4.5 per cent from 2012. But IMF staff estimates, published in The Australian, are less upbeat, forecasting a growth pace capped at three per cent between 2012 and 2014.

Treasury's prediction of a modest 2.25 per cent growth pace for 2011 was also challenged, with the IMF expecting a more modest expansion of 1.9 per cent.

It is also suggested that the RBA would not cut the rates any further as it might rather damage the fragile confidence levels than stimulate growth further.

Business Spectator - RBA says Aust economy will recover by Xmas

Aussie Back to Long-Term Range

Australian Dollar has come back to its long-term trading range, compared to Euro. It is now quite close to its long-term average value of about 1.70 for 1 Euro.

The image below displays the EURAUD exchange rate in the last 10 years. Click the image to see a bigger version.

Unemployment Map – World

At IndexMundi, there is a world map showing unemployment per country. Sourced from CIA World Factbook.

link

Chinese Green Shoots

Many say that the global recovery will start in China and then spread elsewhere. That is where the first signs of recovery are sought and therefore the following represent surprisingly good news:

The rebound in investment and slump in exports suggest China is being pulled in two directions but there are increased signs that the stimulus package is having an effect and could lead to higher growth than previously assumed. Increasing spending to support consumption and pent-up consumer demand suggest Chinese downturn was cyclical not structural (AMP Capital)

 

Umoo – Virtual Trading

If you are not willing to trade in the real markets but are interested in trading, there are sites on the Internet that offer virtual trading, where virtual money is used to trade but real market indices are used as benchmarks. There are often competitions involved, with winners of the game round winning certain prizes or even being offered a trader position with investment institution. Some sites that offer this kind of trading practice and entertainment are ASX and Yahoo Finance. Now I have just came across one more such site: Umoo, virtual stock trading.

Umoo is a virtual trading game where one can practice her trading skills and without the risk of losing money. The site offers real-time market data and various tools needed for stock market analysis. Using these is fun, entertaining, and educational even if you are not prepared to trade in the real stock market.

The description from the web site is:

UMOO is the leading fantasy stock trading game, offering the thrill and profit opportunity of the financial markets in a unique competitive format.
It's an alternative, virtual stock market contest where risk is minimal and the opportunity to win is real.
Traders pay a fee (buy-in) in order to enter a tournament of their choice, where they receive virtual money with which to build and cultivate virtual portfolios based on real-time stock market quotes in competitive trading tournaments.
The objective of the players is to earn the highest returns on their portfolios. Throughout the tournament, players are benchmarked against others in real-time; at the end of the tournament the winners are those with the highest returns relative to the other traders in the tournament. Winners receive cash prizes according to The payout structure of the tournament.
Real-time market data and a variety of information & research/reference tools are offered on the UMOO platform to help traders make informed dynamic decisions while trading. Real market trading tools are also offered, including limit and stop loss orders and the ability to sell short.
In sum, traders on UMOO can both develop and deploy trading skills for fun and profit.

Vanguard Launches ETFs in Australia

Today, May 8, 2009, Vanguard Australia will be launching a suite of exchange traded funds (ETFs) on Australian Stock Exchange (ASX). The funds to be launched today are:

ETF	ASX code	Benchmark	Fees p.a.
Vanguard Australian Shares Index ETF	VAS	S&P/ASX 300 Index	0.27 %
Vanguard All-World ex-US Share Index ETF	VEU	FTSE All-World ex-US Index	0.25 %
Vanguard US Total Market Shares Index ETF	VTS	MSCI US Broad Market Index	0.07%

The ETFs are purchased through a standard brokerage account while standard Vanguard index funds are purchased directly from Vanguard.

Rudd Government will end the private health insurance rebate | Federal Budget 2009 | News.com.au

The Government’s rebate on private health insurance payments will be waived in the new budget. However,

while the first round of tax cuts will take effect from July 1, the health insurance rebate will not be scaled back until July next year.

Rudd Government will end the private health insurance rebate | Federal Budget 2009 | News.com.au

Bosnia's Economic Outlook: IMF Agrees To 1.2 billion Euro Loan

RGE announces:

• May 5: Bosnia and the IMF agreed a 1.2 billion euro ($1.61 billion) deal over three years to lessen the impact of global economic crisis

• IMF: Measures agreed focus on fiscal consolidation and public sector wage restraint, which, in addition to ensuring stability in the short term, will also help bring public finances on a sustainable path

More ETFs in Australia: iShares

iShares is another provider, offering exchange-traded funds (ETFs). iShares is owned by Barclays Global Investors. They offer 19 ETFs covering worldwide markets and indices. The web site offers plenty of data on fund constituents and performance. Some funds are geographical regional indices while others are sector indices.

Underlying fees amount to 0.48%. Since most indices are international but hedged to Australian Dollar, there is a currency risk involved. So, the total return from any index follows not only the index performance but also the relative performance of the Australian Dollar.

iShares web site