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Why I believe in good times ahead
As per usual, our major news outlets are pedaling beware of recession and market-collapse stories while ignoring the fact that there is a lot of good news around that should make us positive for 2018.
Go internet and Germans!
However, it’s hard for good news stories to get column inches in many news outlets and this is why I’m happy that we have the Internet and Germans!
These odd reasons for happiness surfaced this week following misreporting around a World Bank take on where the global economy was heading.
After hearing and reading about a World Bank story in the press that brought warnings about the global economy and financial markets, I was surprised at the extent of the negativity.
Surprise, surprise, I’m positive!
My assessment is more positive and so my response was basically: “What does the World Bank know? Those guys have often been well off the pace!”
Also read: Switzer’s top 5 predictions in 2018
Fake, fake, fake…
Where was their warning pre-GFC? But one day on, I realise that like many others, I’ve been a victim of what Donald Trump calls “fake news”! And I thank the Lord for the Internet and Germans for setting me straight.
No finger pointing
I won’t name the news outlet that ran with the ominous warnings about our economic and market outlooks. Suffice to say, it focused “on the other hand” warnings that most economists will give you after holding an alternative view. Sometimes they talk about the short-term view but then compare it to the longer-term position or they can point to potential problems if policy-makers don’t take certain steps.
Aim: scare the pants off people
These more scary references are often picked up by those in the media who believe they are doing some community service by scaring the pants off normal people who never test the source of their news.
I’m not normal!
Well, I’m not normal and I do test my sources, and in this case the news is excessively negative.
Here’s the garbage
Over in the UK, one newspaper took the World Bank’s view and came up with: “After better than expected growth in the global economy, the World Bank says financial markets are vulnerable to unforeseen negative news.”
And there was more.
“Financial markets are complacent about the risks of sharply higher interest rates that could be triggered by better than expected growth in the global economy this year …”
Also read: More long term greed… Tim O’Reilly’s recipe for a successful 2018
What about the good news, mate?
So, this journalist threw away the good news of “better than expected growth in the global economy this year” to focus on “unforeseen negative news”.
Come on! That’s one-eyed half-news and borders on fake news. And by the way, if I hadn’t got up this morning and went to the Internet to test out the negativity of that story, I would never have discovered the dw.com website, which is the home of Deutsche Welle. This is the international broadcasting news unit out of Germany and here’s how they covered the story.
The German view
Compare this headline with the negative news coverage above: “World Bank upgrades growth outlook on strengthening recovery.”
Where’s the truth?
And the first paragraph shows us what news used to do and it was called telling us the truth. This is how this story starring the World Bank ran: “The global lender has surprised analysts by predicting better-than-expected global growth. But the bank also warned of fading potential mainly in advanced economies due to aging populations.”
Come on, be balanced
I’m not against negative news stories, so long as positive ones are given at least equal coverage.
Why do I care?
Well, we have a consumer confidence problem in this country and it affects consumption, economic growth, business profitability, jobs growth and even the bottom line of the Federal Budget Deficit.
All up, there is an economic problem that does not need unnecessary negativity, which adds to related social problems.
All Australians should care about our social issues and, ironically, many of our more leftish news outlets, which talk down the economy, seem very preoccupied with how governments don’t do enough about our social issues.
Don’t annihilate us
Of course, apart from politicians’ shortsightedness, our leaders often lack money to help people and that’s why a strong economy needs to be encouraged not ‘bombed’ by bad journalism.
Share the joy
Let me share what dw.com thought its valued readers needed to see from the World Bank.
“According to the World Bank’s Global Economic Prospects report released Tuesday, the global economy is expected to grow by 3.1 percent in 2018, after a better-than-expected performance in 2017 that boosted global gross domestic product (GDP) by three percent last year.
“In its twice-yearly report, the bank noted that for the first time since the global financial crisis, all major regions of the world were experiencing an uptick in economic growth.”
And the Bank itself said: “The current, broad-based growth acceleration is a welcome trend and could be self-reinforcing.”
On the downside
The Bank warned that the new interest rate rising part of the economic cycle brings risks but these are well known and basically are in the hands of central banks. If they raise rates too fast, then there could be problems in late 2019 or 2020, but given the calibre of central bankers, it remains a low order risk for a few years.
Also read: Property investors are in trouble
Read this list of goodies
And while the OS economic story looks good, what about the local story? What follows are the latest data revelations since New Year’s Eve:
Job vacancies rose by 2.7% to a record 210,300 in the three months to November. Job vacancies are up 16.1% on a year ago – the strongest annual growth rate in 7 years.
Approvals by local councils to build new homes rose by 11.7% in November, after falling by 0.1% in October. It was the strongest monthly outcome in 12 months. In trend terms, approvals rose for the tenth straight month, up by 0.9%.
The weekly ANZ/Roy Morgan consumer confidence rating rose by 4.7% to 122.0 last week – the highest level in four years and well above the long-run monthly average of 112.9.
According to the Federal Chamber of Automotive Industries (FCAI), new vehicle sales hit a record high of 1,189,116 units in 2017, up 0.9% on a year ago.
The CBA Purchasing Manager’s Index (PMI) for the services sector rose to 55.1 in December from 54.0 in November. The index is at 5-month highs.
The Australian Industry Group (AiG) Australian Performance of Services Index (PSI) increased to 52.0 in December from 51.7 in November. The index remains over 50, signifying expansion of the services sector.
Over the year to October, the proportion of occupied seats on domestic flights hit a 6-year high of 79%. Load factor on the Sydney-Melbourne route was at record highs.
International passenger traffic to Australian airports rose by 4.5% to 3.37 million in October, up from 3.226 million a year ago.
Job advertisements declined in December, falling by 2.3% to 167,656 ads, after rising by 1.1% in November but December is not a great month for new hiring but, for the year, job ads are up a healthy 10.8%.
My take
It’s fair to say that optimists are going to have a better year than pessimists in 2018 and long may it remain that way!
