Will Improvements In The Economy Be Short-Lived? - Talking Business 2011 Ep 42c

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

Leon and Garry discuss how the Gillard government has framed the first mini budget in two decades but Westpac casts doubt on whether the budget can be put back into surplus next year. A leading index of the Australian economy moderated in September suggesting that evidence of a mid-year improvement in overall activity may have been short-lived. ABS stats show wages excluding bonuses rose a seasonally adjusted 0.7 per cent in the third quarter of 2011.Superratings figures show Australian superannuation funds have reported the worst five-year returns since the introduction of compulsory super contributions in 1992. The outlook for Australia's manufacturing industry is bleak, with output falling by almost one per cent in the September quarter. The Reserve Bank of Australia (RBA) has not given any indication that it will cut interest rates again in the coming months. ABS figures show business lending has fallen sharply but sales of new motor vehicles in Australia rose 1.1 per cent in October. Australian exporters will secure access to a free-trade bloc covering one-third of the world's gross domestic product after agreement from the US to lead the development of the Trans-Pacific Partnership. Australia’s ban on uranium exports to India is set to be overturned. Parts of the dominant services sector, like hospitality, are being hit by the slowdown in consumer spending. Paint maker DuluxGroup's full-year profit is up 52 per cent to $93.24 million. Farming conglomerate Elders has reported its third consecutive annual loss of $395 million. James Hardie reports a $US128.4 million ($126.51 million) profit. Ban CEOs get big pay rises. QR National is in talks to determine whether it will build a rail network to transport iron ore in Western Australia's Pilbara region for junior miners. Toyota has called a worldwide safety recall on three of its car models. Female business owners are 6% more likely than their male counterparts to use at least one form of social media in their business, according to a new study released by American Express. The former government-appointed advocate for Australia's steel sector says high wage costs, inexperience and the strong Australian dollar left domestic steel companies with little chance of winning contracts to build major local resource projects. BHP Billiton says it will spend billions ramping up shale gas production in the US this decade and it puts more fund into its West Australian iron ore operations. Budget airline Tiger Airways blames the grounding of its fleet and fuel prices for a $50 million loss and it expects more losses. A review of News Ltd's major newspapers has found no evidence of illegitimate phone surveillance or payments to public officials. Uranium miner Paladin posts a $US123.4 million loss. Woodside estimates its Browse Basin LNG project will generate up to $50 billion in revenue. Private equity fund Pacific Equity Partners offers a $700 million takeover proposal for Spotless.

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Garry Barker and Leon Gettler
RMIT, business, economics