POWERED BY MOMENTUM MEDIA
Worst may be over
|
| Matthew Peter |
New research released by Queensland-based institutional investor QIC has suggested that the worst of the global financial crisis may be over.
Discussing the new research, QIC said there were signs emerging that the pace of contraction in the global economy was abating following significant fiscal stimulus.
It said its research indicated that the Obama Government's fiscal package in the US would boost gross domestic product (GDP) growth by 0.7 percentage points in 2009 and by 1.3 percentage points in 2010 while, in Australia, the Rudd Government's package would boost GDP growth by 1.1 per cent in 2009 and 0.6 per cent in 2010.
The research analysis said implementation of the fiscal packages had coincided with a sharp improvement in investor confidence following the slump experienced after the failure of Lehman Brothers. Equity market volatility had fallen to its lowest level since September 2008 and share markets have surged by 35 per cent since March 2009.
Commenting on the findings, QIC chief economist Matthew Peter said if the fall in confidence that occurred in late 2008 was to reverse, the impact of fiscal packages would be magnified.
Peter said history suggested that an improvement in confidence could occur very quickly and that the opportunity cost to investors who took a wait and see approach could be significant.
However, he cautioned that large fiscal packages had clouded the longer-term outlook, as governments would eventually need to raise taxes and lower spending to stabilise the build-up in public debt.
AUTHOR
Mike Taylor
Recommended for you
Superannuation funds have posted another year of strong returns, but this time, the gains weren’t powered solely by Silicon Valley.
Australia’s $4.1 trillion superannuation system is doing more than funding retirements – it’s quietly fuelling the nation’s productivity, lifting GDP, and adding thousands to workers’ pay packets, according to new analysis from the Association of Superannuation Funds of Australia (ASFA).
Large superannuation accounts may need to find funds outside their accounts or take the extreme step of selling non-liquid assets under the proposed $3 million super tax legislation, according to new analysis from ANU.
Economists have been left scrambling to recalibrate after the Reserve Bank wrong-footed markets on Tuesday, holding the cash rate steady despite widespread expectations of a cut.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom 465 Calder Road Calder
99.46 3 y p.a(%)
2
DomaCom DFS Mortgage
95.46 3 y p.a(%)
3
Global X 21Shares Bitcoin ETF
78.55 3 y p.a(%)
4
BetaShares Crypto Innovators ETF
50.39 3 y p.a(%)
5
Global X GlobalX FANG+ ETF
47.50 3 y p.a(%)
