This post was written by Nick Lockhart @ mrd
Posted Under: From the desk @ mrd
Last week the International Monetary Fund (IMF) updated its ‘World Economic Outlook’ reporting a cut to their world growth forecast for 2012. They expect Europe will fall into a mild recession which will affect other parts of the world including the USA, emerging markets, and developing countries. Projected growth in the advanced economies has been revised down to 1.2 percent this year and 1.9 percent in 2013.
Never Let The Truth Get In The Way Of A Good Story
Different people/groups may ‘spin’ these figures in a variety of ways… but let’s simply take an objective and sober look at the facts.
- For all the talk this report has incited of ‘another global recession’… the same report says global economic growth in 2012 will be 3.3 percent! Dissecting the differences between individual regions and countries paints a positive outlook for Asia… and those countries tied to it.
- 2012 – 2013 growth in emerging and developing economies is expected to average 5.75 percent; down from the 6.75 percent growth in 2010 – 2011
- Despite a 0.75 percentage point downward revision, developing Asia is still projected to grow most rapidly at 7.5 percent on average in 2012 – 2013
- Economic activity in the Middle East and North Africa is expected to accelerate in 2012-13
- Most oil-importing countries in the region face muted growth
- The impact of the global slowdown on sub-Saharan Africa has to date been limited to a few countries, most notably South Africa, and the region’s output is expected to expand by about 5.5 percent in 2012
When reading editorials or listening to TV programs that report on what the IMF said… it’s important to be mindful of what their report actually contained. The points above should be comfort enough for those fortunate to be living in this great country we call Australia; but here’s some more nonetheless:
- “The adverse spillover effects are expected to be the largest for central and eastern Europe, given the region’s strong trade and financial linkages with the euro area economies”
- “The impact on other regions is expected to be relatively mild, as macroeconomic policy easing is expected to largely offset the effects of slowing demand from advanced economies and rising global risk aversion. For many emerging and developing economies, the strength of the forecasts also reflects relatively high commodity prices”
Like me you want to navigate your way through these challenging times and come out the other side better off. I see MORE opportunity to progress financially than in years gone by – we’re facing the perfect storm!
- Sections of our property market have bottomed and are just beginning to rise – that’s a buying opportunity
- Interest rates are low and dropping – this will increase demand for property and push prices higher
- Australia’s population is growing yet new housing numbers consistently fall short – limited demand MUST result in higher prices
I’ll stop there although I could go on.
Swimming is great but care needs to be taken to avoid drowning… so too with investing. At mrd we only recommend the responsible use of the right kind of debt. Don’t make avoidable mistakes… talk to us first!
The Downside Of A Buyer’s Market
In a buyers market when prices are down… so too are valuations. In my experience this is when valuers are at their ‘worst’, making it difficult to access and use existing equity. For those in a position to take advantage of a buyer’s market… DO IT – THERE’S NO BETTER TIME!
Your Next Step
Step one is to have your current position assessed by someone whose motives are not self-centered. NB: Don’t pay to have this done – you don’t need to! For those with the borrowing capacity, buying conditions and some buying opportunities make now a great time to be considering your next investment.
- Heather from mrd finance… along with one of our property mentors will happily (and professionally) assess your current position before discussing your options with you. To request this support simply complete a “My Starting Point” assessment form >>>here.
- Alternatively… contact us with your question(s) on ‘anything property’ >>>here
Posted Under: From the desk @ mrd with No Comments
Tags: advanced economies, another global recession, Australia, Australia's Population Growth, developing asia, developing countries, emerging markets, European Recession, existing equity, high commodity prices, imf, increase demand for property, international monetary fund, low interest rates, Low Valuations, macroeconomic, Middle East, mrd Finance, North Africa, property market, rising global risk aversion, slowing demand, world economy, world growth forecast

