30/07/2009

GOOD NEWS STORIES – JULY 2009

 

“Each time a man stands up for an idea, or acts to improve the lot of others, or strikes out against injustice, he sends forth a tiny ripple of hope, and crossing each other from a million different centres of energy and daring, those ripples build a current that can sweep down the mightiest walls of oppression and resistance.” – Robert F. Kennedy

Here are a few 'ripples of hope'.
 

At Townsends Business and Corporate Lawyers we strive to be the first ripple.  We don’t let the talk of recession bring us down.  Here are just some of the good news stories we’ve seen this month.

 

The GFC boosts innovation

 

Recessionary periods force many companies to look hard at their investments as companies are on tighter budgets.  Bob Johnson, Vice President of Research at Gartner said “what investment there is, is going to be in technological innovation, not increasing production.”

 

Historical patterns seem to indicate that tough times are soon followed by innovative breakthroughs.  Anand Cahndrasekher, Senior Vice President of Intel’s Ultra Mobility Group pointed out that the 1970s oil shock was followed by the invention of the mobile phone, the early 1980s recession preceded the creation of PCs and the Wide World Web was born soon after the stock market crashed in 1987.  So hold your breath as we may yet see another major breakthrough!

 

RBA holds rates as economy stabilises

 

At its monthly meetings for July the Reserve Bank of Australia (RBA) left the official cash rate unchanged at three percent.  The Executive Director of Australian Retailers Association (ARA) Mr Evans stated that the RBA’s decision to hold the interest rate meant that we are seeing signs of emerging confidence and stability.  “The RBA has applied good fiscal policy by holding interest rates at a time when consumers are cashed up and ready to re-enter the market” he said. 

 

“With low interest rates, low petrol prices and high Australian dollar, there is a lot of good news for consumers at the moment and retailers are optimistic about the future.  But right now they’re working hard to stimulate consumer spending and to overcome the negative rhetoric that economists and leaders continue to spruik.

 

"Today's interest rate hold is another sign to consumers that the Reserve Bank is confident we are on the road to economic recovery," Mr Evans said.

 

Australia hits the largest trade surplus in recorded history. 

 

“Recession” ought to be a word Australians should use sparingly as a recent release of the Balance of Payments showed our trade surplus skyrocketing and is the largest trade surplus recorded since the series began in late 1959.

 

Net exports are expected to strengthen GDP growth, reflecting an increase in export volumes and a significant decline in import volumes.

 

Recovery is just around the corner for the United States

 

Many people in the US are starting to realise that this recession can’t be that bad when you look at the recent figures on jobless claims and business profits.  Initial jobless claims fell to the lowest since January this year of nearly 50 thousand in the week ending 11 July.

 

Also a recent Bloomberg update shows that "earnings have topped estimates by an average of 24 per cent for the 28 companies in the S&P 500 that released results since July 8."  How off the mark some “experts” can get with their projections is quite alarming and global positive sentiment is definitely on the rise.