Wednesday 15th of December 2004

For much of their history the Aussies seem to have suffered more seriously from boom and bust cycles than New Zealand. My father says the poverty he witnessed in Sydney in the 1930s depression was even worse than he encountered on this side of the Tasman.

# So far this year our sharemarket has risen 27.5 per cent (compared with Australia's 23.4 per cent);

# Based on ANZ Bank figures, our gdp is forecast to grow this year by 4.8 per cent (against Australia's 3.6 per cent);

# Unemployment has fallen to an 18-year low of 3.8 per cent and is forecast to fall to 3.7 per cent by December; this compares with Australia's 5.2 per cent in November.

# Our forecast current account deficit is $7.7 billion, or 5.3 per cent of gdp; this compares with Australia's A$51.5 billion, or 6.1 per cent of gdp.

# Our terms of trade are at their highest level in 30 years; though ANZ Bank forecasts suggest the Aussies may do better than us on this measure because of their mineral wealth.

# The magnitude of Michael Cullen's Budget surplus is becoming an election issue here; in contrast, Australia's federal government has been under attack for hefty spending.

Mind you, we're paying for the privilege of an apparently healthier economy. Unlike Australia's, our economy is showing few signs of slowing down, which brings the threat of higher inflation.

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