Car sales: comparing the UK and Australia. Here’s a rough, but interesting basis on which to compare the relative strengths of the Australian and UK economies at the moment: new car sales.
In August Australian car sales fell 12.3% to just over 77,300 according to the Federated Chamber of Automotive Industries’ monthly report. In the same month in Britain, new car sales totalled 63,225 according figures released last week. Now Australia has a population of just over 21 million’ the UK around 61 million, so the slump in Britain is quite apparent.
That sales figures was the lowest in more than 40 years, according to UK analysts, ours was the slowest for several years. Our car sales for the year are still above those for the same period of 2007, the UK’s are down sharply. In fact the UK monthly figure was the lowest since 1966. — Glenn Dyer
US Is “More Communist than China”. The nationalization of Fannie Mae and Freddie Mac shows that the U.S. is “more communist than China right now” but its brand of socialism is meant only for the rich, investor Jim Rogers, CEO of Rogers Holdings, told CNBC Europe on Monday. “America is more communist than China is right now. You can see that this is welfare of the rich, it is socialism for the rich… it’s just bailing out financial institutions,” Rogers said.
Stock markets jumped after the U.S. government’s decision to launch what could be its biggest federal bailout ever, in a bid to support the housing market and ward off more global financial market turbulence. But Rogers said in the long term the move spelled trouble.
“This is madness, this is insanity, they have more than doubled the American national debt in one weekend for a bunch of crooks and incompetents. I’m not quite sure why I or anybody else should be paying for this,” Rogers told “Squawk Box Europe.” — CNBC
Buying brains offshore. Offshoring in the financial services industry was alive and well during the latest Australian reporting season as senior analysts from India stepped in to help local analysts do their numbers.
In one case, an Indian analyst employed by the Indian investment research group, Irevna, spent the reporting season in Australia attending earnings briefings alongside the local lead broking analyst. Another analyst from Irevna worked behind the scenes in Chennai providing a local analyst with assistance delving into one of the more complex debt laden entities in the Babcock & Brown group of funds. A third example from the Irevna files involved an Australian analyst who was able to increase the number of stocks he covered from 16 to 22 backed by an Irevna analyst in India.
These are just a few examples of how the research outsourcing trend is coming to Australia. It is well entrenched on Wall St and in Europe. According to industry estimates about $US2 billion is being spent each year on outsourced investment research with about 65 per cent of that earned in India. The market is said to be growing at a compound rate of about 32 per cent. — Tony Boyd, Business Spectator
CBA boss gets pay rise amid credit crunch. As Australia’s mortgage-saddled barbecue belt feels the pinch from high interest rates and soaring petrol prices, few will be raising a tinnie and toasting Ralph Norris. The chief executive of Commonwealth Bank will pocket $8.66 million this year, thanks to a 30% pay rise amid the global credit crunch.
The boss of the country’s biggest bank has seen his base salary more than double — and his overall cash, shares and bonus package jump by $2 million, or 30%, to $8.66 million. That figure includes a $500,000 increase in his cash bonus, to $1.9 million, after Commonwealth recorded a net profit of $4.73 billion this year. Add to that a $1.65 million increase on his base pay, which makes up just over a third of his total remuneration. Norris collected a base salary of $3.12 million — similar to his peers at ANZ, National Australia Bank and Westpac.
Not bad for the bosses of banks that have been quick to pass on the pain from the global credit crunch to retail clients — by lifting rates out of step with the Reserve Bank. — Mark Hawthorne, The Age