The Last Gasp is a wry take on the week's news, every week.
Well, it was a good week for the Australian taxpayer. Both parties looked set to ghost through parliament extra public funding for themselves which, many thought, went beyond what the system really needed while also not doing enough to enhance transparency.
Tony Abbott had – literally – signed off on the Labor plan, meaning that when he changed his mind at the last minute after “listening to” (being under pressure from) his party and the community, Julia Gillard, now unable to get the legislation through, could wave the document in his face showing that he was on board before the political winds got too gusty.
The episode left both parties financially and politically poorer, which was funny. Sure they now had different positions, but Labor’s questions of Abbott’s trustworthiness – non-core, core promises, backflips and the like – were effectively cancelled out by the Coalition’s ‘more pure’ position on campaign funding. All in all, a zero-sum game.
Speaking of zeroes, news out of the US this week cast some more light on just what went wrong with Ford’s manufacturing business in Australia. It seems the cars it was making weren’t too big or too expensive - just too fossily. Whiz kid entrepreneur Elon Musk (of Paypal fame) has turned his upstart electric car company, Tesla, into an unmitigated winner less than a year after Mitt “My foot is 47 per cent in my mouth” Romney called it a loser. Turning a quarterly profit for the first time this week, Tesla has also attracted $1 billion in private funding this year, scored record vehicle ratings from consumer publications and paid off government loans nine years ahead of time. Oh, and the revvvv-olutionary company’s share price has tripled since March. We think there should be a market for Elon’s musk: ‘for that sweet smell of success.’
Back in Australia, the Australian stock market continued its bumbling ride, on track to fall 1 per cent for the week (but it at least represented a break on last week’s year-to-date nadir, which saw it fall 3.8 per cent). As is so often the case in life, the banks were largely to blame. The big four have shed nearly $40 billion in stock market value since Ben Bernanke’s May 1 'will I or won’t I' speech about easing off QE. It seems in the chase for yield, the big four had momentarily become the fat four. But we still think they’re fab.
The other big issue this week was the mining investment peak, with more economic indicators suggesting the peak, which was meant to happen in November, has already passed. Those in the non-mining sectors who had planned ‘peak parties’ quickly rescheduled while elsewhere resource contractors reportedly spat the dummy and threw down their tools, before picking them back up and taking them off to the pawn shop.
Commentators here and abroad ran the ruler over Australia’s economic ledger, searching for a way to stimulate growth in the face of this looming economic hole. And they pretty much came up with one solution: easier monetary policy. Who would’ve thunk it. It seems they don’t call it easier for nothing.