Australia as a Two Speed Economy - Talking Business 2011 Ep 31c

A review of the week in business, with expert analysis and commentary.

Leon and Garry discuss how Australia is now officially a two speed economy according to fund managers. The federal government has been urged to hold an inquiry to help stave off a threat to manufacturing. Manufacturers are five times more likely to struggle to pay bills than other businesses. Growing rifts are emerging between the federal government and the opposition over the future of manufacturing. Pressure is growing on the Federal government for a review of workplace laws. BIS Shrapnel says investment in roads, rail, ports and education is necessary to prepare Australia when the mining boom ends. Australian chief executives are much less confident about the economy than they were this time last year. ABS data shows Australian households are effectively becoming poorer. Australians cut back on personal borrowing for a fourth straight month in July while annual growth in home loans was the slowest on record. Fears of a looming domestic slowdown have compelled a rising number of Australian companies to expand into emerging markets. Woolworths' chief executive Michael Luscombe expects a sharp decline in its annual profit growth in fiscal 2012. Australian dwelling approvals rose one per cent in July, seasonally adjusted, according to the Australian Bureau of Statistics. House prices are on the slide. New home sales fell by 8% in July. The goods and services tax will have to climb above 10 per cent says a Henry Review architect. Former Tabcorp boss and one-time ANZ executive Elmer Funke Kuppe has been appointed to take charge of the Australian Securities Exchange. Gold mining companies respond to record-high gold prices with a big increase in gold production. Gold miner Resolute Mining has swung back to profitability in 2010/11. Harvey Norman’s net profit increases 9 per cent to $252.26 million. QR National reports a net profit of $349.5 million. More retailers will close down according to a new survey. But IKEA is upbeat as it prepares to open a huge Melbourne store. Tiger Airways Australia loses another chief executive. The Australian Competition and Consumer Commission (ACCC) is seeking an injunction against energy broker Energy Watch. A Macquarie Group-led consortium of international investors has made a $1.74 billion takeover bid for Charter Hall Office REIT. Count Financial doubles its profit to $52 million in 2010-11. Meanwhile, Commonwealth bank of Australia Ltd moves to buy Count Financial Ltd for $373 million. Goodman Fielder reports a full-year net loss of $166.7 million. Centro Properties Group's underlying annual profit falls 92 per cent to $14.6 million. Centro directors escape being fined or banned. A $2.17 billion takeover offer by a group funded by pension schemes in the UK, Netherlands, South Korea, China, Denmark, New Zealand and the US for toll road owner ConnectEast gets Foreign Investment Review Board approval. ANZ looks at buying distressed Tokyo Star Bank. Samsung Electronics Co says it will delay the launch of its latest Galaxy tablet computer in Australia until after a court ruling in late September on its ongoing global patent dispute with Apple.

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Garry Barker and Leon Gettler