Jul 4, 2013

Welcome to the post-boom economy … hope you like it

Australia's economy is booming, right? Not anymore. MacroBusiness editor David Llewellyn-Smith says it's time to say goodbye to mining, rising house prices and favourable trade.

Yesterday was a remarkable day in the Australian economy. Not for any one reason; for multiple reasons, in fact. In a day of rich data and news flow, everything pointed in the same unfamiliar direction: towards an economic future that has been long discussed and thought of as distant but has arrived early. It is post-mining boom. It is post-housing boom. It is post-consumer boom. It is the export volume boom, and you better understand what it means if you wish to maintain your standard of living.

A quick look back helps make the point. For the past decade and a half Australia’s economy has been driven by two successive booms. The first was the housing and consumption craze across the millennium and up to 2003. From there, growth was taken forward by China and the resources boom, first in commodity prices then later in investment in new mines. But all three of those are out of steam. Yesterday’s news flow made the point very clearly.

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3 thoughts on “Welcome to the post-boom economy … hope you like it

  1. Liamj

    Hurrah, bring on more recognition of reality! For extra points put Oz’s flatlining in context of SHRINKING economies across rest of OECD, and for gold star consider significance of declining net energy from ‘unconventional’ oil, browner coal, and climate-hit agriculture. We’re post-peak, people, get used to it.

  2. David Coles

    We’ll all be doomed said Hanrahan, before the year is out.

  3. morphy richards toaster

    Only a moron would think housing prices will grow from here on in. Two decades of economic growth, job security, strong wage rises and (reckless) tax cuts from Howard have led house prices to where they are. All four of those conditions are now reversed.

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