Australia as I predicted: 1

I have predicted Australia trouble here A and here B. Here is part of an email that I wrote to a friend in Australia last year when I attached what I said in here B.

“I love Australia and trust that you are very experienced in investing your own money... The first one is probably the most relevant to you. The real challenge for China, and also Australia, will probably happen the next year and after.”

I will soon post some specific opportunities to avoid loss and make money when I wrote him again this May.  I have mentioned these opportunities to other friends since last fall. But some students in my global macro class are presenting a report about Australia on June 8. So to be fair, I cannot post the predictions on my blog right now. I will post the opportunities after their presentation. Stay tuned.

I remember a presentation that I have sit through in Sydney in early February 2012. A so called keynote speaker (well respected in Australia finance circle) was blasting Spain, Ireland, and other Eurozone peripheral countries, all as moral midgets, and then uses Australia to illustrate how morally superior Australia is over those countries. It was suffocating. The world is full of silly people who may have lots of connections and money (The same happens in academic world where many academicians only know the nitty-gritty of their narrow field but know really little about how the world really works but still boldly being consulted on TV or media as talking heads). Sometimes I just walk out, like in a conference I went to in HK where the only person who made some sense was Oliver Blanchard, whereas people like Robert Mundell and Ronald McKinnon are talking total BS.  But I was stuck among the seats in the Sydney dinner. So at the end for revenge of torturing my mind, I raised my hand and told him that although Spain and Ireland look so bad now, they looked similarly good as Australia now just before the Great Financial Crisis; Australia will end up somewhat in similar situation in the next few years, where the main difference, and it is a major difference, is that Australia has its own currency.