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Economic Snapshot – Jan-Feb 2016

Economic Snapshot – Jan-Feb 2016

January was an extremely difficult month for the world’s financial markets with very sharp falls in the price of equities and commodities. Price volatility both within and between days was exceptionally high. These conditions were attributed to the surprisingly large fall in the price of oil, economic data
from China, the US Federal Reserve [Fed] lifting interest rates and concerns about the state of emerging economies. All this led to speculation about an imminent recession and even “the next leg of the GFC” with some extraordinary statements issued from a Bank Of Scotland analyst saying it is “time to sell
everything”.

In reality these comments appear more colourful than constructive, with the economic data revealing nothing to support that much pessimism. The markets continued to selectively misinterpret the data from China, and although the US manufacturing sector showed further signs of slowing, the household
sector remains robust. In Australia, the latest data confirmed recent improvements in the labour market, while inflation remained at the lower end of the Reserve Bank’s target range.

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Economic Snapshot – 2015 in Review

Economic Snapshot – 2015 in Review

What happened, Why & the Outlook for 2016

The start of share markets in 2015 replicated the start of 2014 with strong gains in the first quarter which drifted away through volatile movements over the remaining 8 months. Media focussed on a bad year for markets and investors but despite this returns in many diversified portfolios still managed to outperform cash and term deposits illustrating the benefits of long term investing and diversification.

Historically January tends to be a good month as we start a new year with investments, but 2016 has started differently with losses allegedly linked to the Chinese market and the incessant media commentary on China’s economic slowdown however the discipline of looking at economic fundamentals is the only long term way to invest with confidence and as at January 2016 the fundamentals are pretty good.
Although economic reports often focussed on the USA increasing rates and exiting the Quantitive Easing [QE] programme, the things that really changed 2015’s outlook turned out to be developments in the emerging markets, [notably OPEC and China] coupled with the fall in the price of oil which was a major shock to the global economy. This spearheaded the collapse of the Chinese equity market [from record highs] and then the depreciation of the Yuan provoked fears of spreading recession. These events introduced significant volatility.

Interestingly, the Australian economy actually had a better year than envisaged at the end of 2014. Business conditions improved, as did the labour market and arguably the change in Prime Minister helped improve the national mood. The expected depreciation of the A$ also contributed to stronger business conditions and noticeably helped international investments in portfolios. Nevertheless, the transition of growth outside and away from the resources sector remained slow and prospects of a budget surplus have been pushed out even further. From the perspective of overall wealth creation, the housing market performed very strongly in 2015, leading to the introduction of macro-prudential measures to cool speculative activity.

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20 reasons why you should look for a new business accountant

20 reasons why you should look for a new business accountant

by Christian Borkowski

Finding the right accountant to help out with your business’ financials is no easy task. While it’s easy to check their qualifications, it’s harder to know whether they’ll be the right ‘fit’ for your business. And just because an accountant is perfect for another business doesn’t mean it will be perfect for yours. It really depends on what you want out of the relationship.

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Economic Snapshot – November 2015

Economic Snapshot – November 2015

November was cluttered with mixed messages from mainstream media on global financial markets. Markets appear to have ongoing concern about rising US interest rate increases and weak commodity prices have undermined both bonds and equities through November into early December. An unusually clear message from the Federal Reserve about the likelihood of a rate rise in December and the economy’s ability to handle it sparked a recovery in risk assets in the second half of the month but it then fell away on exactly the same premise. This tells investors to focus on fundamentals not fear. The fundamentals are that the economies of the world are likely to do better over the next few years not worse.
Key economic data in Australia, the US and Europe all suggest scope for modest improvement in economic activity in coming months. However, the manufacturing sector in China continues to slow down as the service sector improves. Again this is nothing new for investment strategists.

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Welcome to our new website and blog

Welcome to our new website and blog

As you can see, it’s a whole new look for us at Prime Advisory and signals an exciting new chapter for us, and for you.

Why also for you? Well, we’ll be sharing with you hints, tips and strategies on a range of topics all focused on keeping you on track in your financial affairs. Our aim with the new blog is to publish educational (and, who knows, sometimes even inspiring!) articles to help you get clear on where you want to be financially and by when, and how to achieve your goals.

Make sure you’re subscribed to our email newsletter too, as we’ll let you know when we publish new articles to the blog.

You’ll notice that the site is mobile-responsive so you can read it just as easily on a smartphone or tablet as you can on a laptop or desktop computer.

Let us know if you have questions about anything on our site, or suggestions for topics you’d like to see in our future blog posts. Just get in touch via the CONTACT section on the site.

We’re looking forward to getting a conversation going where you share with us your thoughts, questions and current financial challenges, and we then write articles that will shed light on the topic and provide you with actionable hints and tips.

For those of you in business – let us know what’s lighting your fire in business currently: The new technologies and apps you’re using to manage and monitor your finances? New business models and ways of resourcing your business? Trends in marketing and new ways of promoting your business and attracting new customers?

Whatever it is in terms of achieving your financial & personal or business goals, we want to hear about it!  So, let’s get the conversation started…

Enter into the Comments below your answer to this question: “What is your No.1 business or personal financial challenge at the moment that, if successfully addressed, would make the biggest positive difference to your asset position, cash flow or stress levels? There’s no ‘right or wrong’ answer of course. Your comments will provide us with inspiration for our upcoming blog posts!  Ask away…

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