Reflecting on the year past and noting significant emerging impacts upon the broader economy, we look cautiously to the advancement of artificial intelligence (AI). The cost of traditional commerce, such as supply chains and multi-handling, has always been a catalyst for ‘cost push’ inflation. As AI advances it dispenses with interim links and becomes vastly more efficient. Costs then diminish, removing the impetus for cost push inflation. AI therefore might be broadly welcomed but its anti-inflation consequence, may become an increasing frustration for both the Federal Government and RBA. There are also obvious consequences for property, particularly in the industrial and commercial sector.
Continuing social reform and political correctness are reshaping the workforce. Corporate leadership cannot focus on core business alone, as if in a ‘vacuum,’ but must have strategies to synchronize and merge their corporate ambitions beyond traditionally defined boundaries so that they are aligned with the broader community. Clients and customers expect their suppliers to be globally responsible citizens and equitable employers. Working to ensure the right corporate culture is essential to drive a progressive commercial ethos ensuring market acceptance and respect. Particularly, the engagement and contribution of Independent Directors must rise to a much higher level than has previously been acceptable.
The future prosperity of Australia through the strengthening of its economy can only flow from increased productivity which can only come from significant and maintained population growth at the core of which must be continued significant levels of immigration. The progressive Asianization of Australia as it fulfils its destiny in the Asian region, not withstanding interim trade tensions or concerns about China’s ambitions in the Pacific, must be embraced by all Australians. National responsibility for the funding of health, government superannuation, the aged pension and other responsibilities in a multigenerational community can only be provided by strong economic growth. In this context, many believe that the Federal Government’s dash to funding infrastructure across the nation is too little too late but at least it is commitment in a much needed sector. In preparation for the population surge both Melbourne and Sydney need to bolster their inventories of sensibly located affordable housing.
Globally, a common denominator of growing and advancing economies, is an efficient public transport system, particularly, fast train services linking key cities. If other countries can do it, why not Australia? A link between Melbourne and Sydney would ignite economic opportunity, greatly assist decentralisation and in all respects be supporting infrastructure to meet the demands of necessary population growth providing job creation, decentralised more affordable living costs and cheaper housing for many.
So there we are, just a few thoughts upon which to reflect as we leave one year and prepare for the next. Interest rates will remain low, wages have stalled, inflation may dip further, and the official interest rate may again be reduced, not that it will have much impact. If that is in any respect a forecast, at least be assured that forecasts of bad weather invariably make for safe sailing.
Seasons Greetings to you all,