{"id":7338,"date":"2015-04-16T06:02:33","date_gmt":"2015-04-16T11:02:33","guid":{"rendered":"http:\/\/olduvai.ca\/?p=7338"},"modified":"2015-04-16T06:02:33","modified_gmt":"2015-04-16T11:02:33","slug":"australia-runs-out-of-luck-now-needs-a-miracle","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=7338","title":{"rendered":"Australia Runs out of Luck, Now Needs a Miracle"},"content":{"rendered":"<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2015\/04\/15\/lindsay-david-australia-has-run-out-of-luck-housing-bubble-resource-bust-to-hit-banks\/\" target=\"_blank\">Australia Runs out of Luck, Now Needs a Miracle<\/a><\/h3>\n<p>Australia, you have officially run out of luck.<\/p>\n<p>While leveraged property investors in Sydney and Melbourne are desperately hunting for a senseless \u201cnet-yield\u201d that makes the yield on a German 2-year bund look rewarding, the Australian mining sector is screaming towards what may be one of the greatest and colossal economic breakdowns in modern Western history.<\/p>\n<p>As iron ore illustrates, this is not a downturn; this is a spectacular crash in the spot price of a commodity. And the sad news is, there is no new demand scenarios (unless China builds more apartments than its population) to suggest that more supply is needed to fulfil the demand of the global economy.<\/p>\n<p>Australia made two bets.<\/p>\n<p>The first bet was that China would willingly consume every ounce of iron ore Australian miners could dig from the ground and pay a premium.<\/p>\n<p>Unfortunately, Australia has built an (<em>incredibly sophisticated and streamlined<\/em>) iron ore production operation so big that the world may never be able to consume all that it can supply. Our treasury, RBA, Miners and politicians assumed that China would forever grow. But they failed to calculate over the long-term that if China continues to consume all the iron ore dug from Australia\u2019s underground, the world\u2019s most populous nation would literally need to build a national subway network, literally an airport every 22 kilometres apart from each other and literally more dwellings\u00a0than people.<\/p>\n<p>&nbsp;<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Australia Runs out of Luck, Now Needs a Miracle Australia, you have officially run out of luck. While leveraged property investors in Sydney and Melbourne are desperately hunting for a senseless \u201cnet-yield\u201d that makes the yield on a German 2-year bund look rewarding, the Australian mining sector is screaming towards what may be one of [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[41,130,151,1851,195,200],"class_list":["post-7338","post","type-post","status-publish","format-standard","hentry","category-economics","tag-australia","tag-china","tag-commodities","tag-commodity-price-collapse","tag-debt","tag-default"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/7338","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7338"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/7338\/revisions"}],"predecessor-version":[{"id":7339,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/7338\/revisions\/7339"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7338"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7338"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7338"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}