My readers will have seen that I am not expecting a return to some pre-GFC Golden Age. The Hawker-Keating-Howard-Costelly years may well in hindsight be viewed with a Menzian 1960's glow.
There is no doubt we are in for volatile times with a recessionary flavour, and especially when the truth about the Federal Governments real fiscal position finally drips out. If Andy Xie's forecast for iron ore prices becomes reality, it will be hugely worse. Xie is a very respected Chinese economist.
Strategy needs to be developed for times which are going to be more like the 1970's, a previous period where government interventions caused volatility. Wealth creation strategies need to recognise this.
Those that achieve Prosperity and Financial Security in this environment are those who Negotiate and Survive. The preconditions are a preparedness to change. You can see this in retail and financial services TODAY.
Some of the solutions to these times are to be found at www.corpbuilders.com.au which is a link to four specialist webinars. These will shortly be available online but in the meantime are delivered personally in the Brisbane, Sydney & Melbourne CBD's.
There is a small charge for this, but if you are interested please call Rikk Millhouse on( 61) 7 3733 1588 to make a reservation.
Financial knowlege is financial empowerment, and these webinars are designed to maximise your negotiating power with banks, investors, and in strategy implementation.
Friday, 8 March 2013
Tuesday, 5 March 2013
HENRY THORNTON
I recommend my readers to read Henry Thorntons' column in the Australian today (5th March). HT is a nom de plume for one of the most eminent economists in Australia. For those SME's who are struggling, this is essential reading. For those that aren't struggling, it provides an insight into what the future might hold for you.
Sunday, 24 February 2013
AUSTRALIA'S MARGARET THATCHER MOMENT
Margaret Thatcher came to power in the UK on the 28th March 1979. It did so on the back of a decade of dysfunctional government policies driven by militant trade unions which, bit by bit, destroyed British industry. I know. My family was there and ultimately emigrated as a result. My father was a chief plannng engineer with Rolls Royce aero engines and played an important role in the development of the RB211 engine which powered the Boeing 747. My uncle (his twin) ran the foundry which manufactured the blades you see inside the cowling at the front of the engine.
Rolls Royce became bankrupt or close to, and a generation of skilled engineers, including my family, were asked to take (very) early retirement. Skills lost for ever.
I recall clearly the tales of their frustration with the destruction of their workplace by union organisers. The impact destroyed their careers and the company as it then was. This was an era where British steelmakers were forced to buy British coking coal even though it was more expensive and British car manufactures had to buy British steel, even though it was more expensive.
Not only were inputs more costly, but productivity was low. These industries, and the jobs and families they supported were forced out of business, and ultimately only were revived by foreign capital, foreign management, and the passage of the 1980 Employment Act which commenced the process of trade union reform.
This destruction of skills and a generation of families is happening here in Australia TODAY. Instead of Rolls Royce, take a look at what is happening at some of Australia's technological and manufacturing icons: Cochlear, Resmed and others. These companies run the risk of being exiled or destroyed by the abuse of trade union power. That abuse has and is being facilitated by the Rudd, Gillard, Swan, Shorten government.
Their crocodile tear response to placate those "workers" who are switching to Abbott in droves is a Manufacturing and Innovation Statement which plans to use centralised government planning and the Canberra bureaucracy to drive innovation. I don't think so. What it will do is to further drive the innovators and the much vilified entrepreneurs offshore.
There will be more of this from a government desperate for revenue as a result of four years of ill conceived spending and who believe that good policy is to hobble initiative and business as part of their class warfare strategy. There is not a dollar in the bank to encourage either innovation, entrepreneurship, or the venture capital industry to finance such admirable objectives.
The forthcoming Federal election needs to be Australia's Margaret Thatcher moment. The new government needs to emulate Singapore which is a beacon in how to turn pro-business policy into tangible benefits for the whole of the country.
These old school socialists presently in charge will have a lot to contemplate in their voter forced and well funded retirement as they try to avoid responsibility for ruining the modern progressive Labour Party which did so much to improve Australian business under the Hawke-Keating governments.
Rolls Royce became bankrupt or close to, and a generation of skilled engineers, including my family, were asked to take (very) early retirement. Skills lost for ever.
I recall clearly the tales of their frustration with the destruction of their workplace by union organisers. The impact destroyed their careers and the company as it then was. This was an era where British steelmakers were forced to buy British coking coal even though it was more expensive and British car manufactures had to buy British steel, even though it was more expensive.
Not only were inputs more costly, but productivity was low. These industries, and the jobs and families they supported were forced out of business, and ultimately only were revived by foreign capital, foreign management, and the passage of the 1980 Employment Act which commenced the process of trade union reform.
This destruction of skills and a generation of families is happening here in Australia TODAY. Instead of Rolls Royce, take a look at what is happening at some of Australia's technological and manufacturing icons: Cochlear, Resmed and others. These companies run the risk of being exiled or destroyed by the abuse of trade union power. That abuse has and is being facilitated by the Rudd, Gillard, Swan, Shorten government.
Their crocodile tear response to placate those "workers" who are switching to Abbott in droves is a Manufacturing and Innovation Statement which plans to use centralised government planning and the Canberra bureaucracy to drive innovation. I don't think so. What it will do is to further drive the innovators and the much vilified entrepreneurs offshore.
There will be more of this from a government desperate for revenue as a result of four years of ill conceived spending and who believe that good policy is to hobble initiative and business as part of their class warfare strategy. There is not a dollar in the bank to encourage either innovation, entrepreneurship, or the venture capital industry to finance such admirable objectives.
The forthcoming Federal election needs to be Australia's Margaret Thatcher moment. The new government needs to emulate Singapore which is a beacon in how to turn pro-business policy into tangible benefits for the whole of the country.
These old school socialists presently in charge will have a lot to contemplate in their voter forced and well funded retirement as they try to avoid responsibility for ruining the modern progressive Labour Party which did so much to improve Australian business under the Hawke-Keating governments.
Monday, 18 February 2013
LIONS LED BY DONKEYS
When mainstream economists like Tim Hughes (Brisbane Courier Mail 18th February) start to talk about the "fiscal mess", we know there is a problem which can only be fixed by increased taxation or massive reductions in government spending.
Australians are acknowledged worldwide for our entrepreneurial attributes. A big pity then that we don't have the Swedish Treasurer, Andreas Borg, running the Australian Government. Judith Sloan (Australian 16-17th February) quotes him as saying "entrepreneurs are the source of job creation" and he reduced taxes and charges in response to the GFC. So did the Singapore Government amidst earlier economic volatility.
What does our mob do? Slams "rich entrepreneurs and mining billinaires even if they do create jobs" according to Judith.
It is not just the high profile end of town which has been slammed.
It was this government of course, presumably because they do not like poorer but hardworking people become wealthier -the so-called aspirational class - who killed off employee share schemes -which internationally are well recognised as key drivers of any entrepreneurial economy. The fact that such employee share schemes benefit employee and employer alike didn't seem to matter.
So it shouldn't be much of a surprise that, as the government created "fiscal mess" demands money to fix it, the business sector, and SME's in particular are not going to provide it. Even if they wanted to.
In short, everyone loses. Except for those sacked and retiring Federal politicians who are paid for life by the taxpayer and never have to work again.
Australians are acknowledged worldwide for our entrepreneurial attributes. A big pity then that we don't have the Swedish Treasurer, Andreas Borg, running the Australian Government. Judith Sloan (Australian 16-17th February) quotes him as saying "entrepreneurs are the source of job creation" and he reduced taxes and charges in response to the GFC. So did the Singapore Government amidst earlier economic volatility.
What does our mob do? Slams "rich entrepreneurs and mining billinaires even if they do create jobs" according to Judith.
It is not just the high profile end of town which has been slammed.
It was this government of course, presumably because they do not like poorer but hardworking people become wealthier -the so-called aspirational class - who killed off employee share schemes -which internationally are well recognised as key drivers of any entrepreneurial economy. The fact that such employee share schemes benefit employee and employer alike didn't seem to matter.
So it shouldn't be much of a surprise that, as the government created "fiscal mess" demands money to fix it, the business sector, and SME's in particular are not going to provide it. Even if they wanted to.
In short, everyone loses. Except for those sacked and retiring Federal politicians who are paid for life by the taxpayer and never have to work again.
Friday, 15 February 2013
HOW GOVERNMENTS FUND SPENDING
"From the Reformation .....land had been seen as the most secure asset economically.... the confidence in the stability and security of the land was undermined; faith in a future like the past was much diminished, and the demands of an increasingly hostile, predatory, and instrusive state had to be met. Accordingly, economic decline had its effect, not only on finances, but also on minds, not just on their wealth, but also on their self esteem".
Sound familiar?
The attacks by the present Australian Federal Government on entrepreneurs and wealth held in superannuation are not disimilar to the above when the British Government was required to finance the growth of the welfare state.
A nation which makes its entrepreneurs and savers anxious for their future risks losing both minds and savings. I have written previous blogs about this.
Yet, this is where we are at in 21st Century Australia under present governance.
The quote above properly belongs to the time of Downton Abbey and the David Lloyd George Peoples' Budget, but the parallels are striking.
For the UK, they led to long term economic decline, the export of capital, and ultimately the mass emigation of generations of talented and educated people. Including to Australia.
(The full quote can be found at The Decline and Fall of the British Aristocracy by David Cannadine, Random House 1992).
Sound familiar?
The attacks by the present Australian Federal Government on entrepreneurs and wealth held in superannuation are not disimilar to the above when the British Government was required to finance the growth of the welfare state.
A nation which makes its entrepreneurs and savers anxious for their future risks losing both minds and savings. I have written previous blogs about this.
Yet, this is where we are at in 21st Century Australia under present governance.
The quote above properly belongs to the time of Downton Abbey and the David Lloyd George Peoples' Budget, but the parallels are striking.
For the UK, they led to long term economic decline, the export of capital, and ultimately the mass emigation of generations of talented and educated people. Including to Australia.
(The full quote can be found at The Decline and Fall of the British Aristocracy by David Cannadine, Random House 1992).
Monday, 11 February 2013
THE WORLDS A SMALL PLACE
I have one of the top 5% most viewed @LinkedIn profiles for 2012. http://www.linkedin.com/pub/profile/21/74b/562
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