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Australian money - Source: ONE News -
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The Australian economy might not be as robust as we have been led to believe, as its sharemarket, housing industry and national airline show signs of decline.
Tens of billions of dollars were wiped off the value of the Australian sharemarket last night, after it dropped by more than 2% in a single day.
While natural disasters slowed the wider economy, it was weaker-than-expected data from the US that spooked investors, triggering last night's market slide.
The fall came 24 hours after GDP figures showed the Australian economy shrunk by 1.2% in the first three months of the year - its biggest contraction in 20 years.
House prices are also on the way down and interest rates are up, with a growing number of people with mortgages now worth more than their houses.
Louis Christopher from SQM research warned people this will have a downward effect on the retail sector.
"Being in negative equity means you are going to reduce your spending . You are going to try and save more to get yourself out of that position."
Colin Wood from the Australian Centre for Retail Sales said consumer confidence had also taken a knock, adding to the pain.
"Essentially, retail figures get back to how the consumer feels, and right now the consumer isn't feeling so great about things," he said.
The last of Borders' nine book stores will close after no buyers were found for the debt-laden company, costing 300 jobs.
Even the country's largest airline, Qantas, is feeling the pinch, today offering voluntary redundancies to 7000 of its staff.
About 400 cabin crew staff are expected to take up the offer in the face of sky-high fuel prices.
It is also cutting three daily domestic flights in New Zealand and one Melbourne to Christchurch flight.
As the Australian economy faces its biggest contraction in 20 years, Commsec chief economist Craig James is not shying away from thoughts of a recession.
"We only have to have a small fall in the economy in the June quarter and then we are technically in recession," he said.
There is one hint of prosperity though. The number of Australians who own super-yachts has tripled in the past five years, with 110 people now owning yachts more than 30m long, up from 30 five years ago.
