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Hello, I am Peter Switzer, welcome touch
to the program that puts you in minds
touch with the best and brightest show,
minds in the business. On tonight's have
show, ANZ chief economist said we which
have two more rate cuts ahead, Reserve
which puts him at odds with the AMP
Reserve Bank boss. But what does said?
AMP Capital's boss, Shane Oliver rates,
said? What will happen to interest forceful
rates, one man and bound to have a When
forceful view is Christopher Joye. an
When it comes to rates, will he be prospecting
an up or a down by? We will go of
prospecting for mining acquisitions and
of KPMG's acquisitions in Paris, chasing
and we will find out why banks are Onselen.
chasing women with Ainslie van constant
Onselen. And we will see if the analysts
constant watching of our top negative
analysts is giving a positive or Stay
negative outlook for stock prices. will
Stay with us for the next hour. We latest
will build -- bring you all the questions
latest news. If you have any email
questions for me or our guests, switzer@skynews.com.au.
email them to on
switzer@skynews.com.au. Follow me @peterswitzer.
on Twitter, the handle is major
@peterswitzer. If there was one falling,
major reason why our stocks are is
falling, it would be economic. It AMP's
is totally appropriate to grill economic
AMP's Shane Oliver to see if the which
economic bad news has a use by date, you.
which I hope is sin. Welcome.Thank by
you. How are you?I'm a bit rattled interest
by the call for it two more Glenn
interest rate cuts. What you think that?
Glenn Steven said when he heard probably
that?Good question. Warren would said
probably agree, what Glenn Stevens thinking
said often reflects what he is trying
thinking at the time. Warren is where
trying to look ahead a bit and say, to
where are the risks? I would tend are
to agree with him in the sense we further
are probably looking at a bit will
further of growth being sub par. It year,
will probably continue into next measure
year, which is below whatever measure of trend in Australia. You capacity,
are still building up spare unutilised
capacity, spare resources, At
unutilised workers in the economy. needed.
At some point, more help might be or
needed. I think Glenn was, a week talk
or so ago in Canberra, trying to guess,
talk things up a little bit. And I really
guess, the Reserve Bank doesn't again,
really want to have to cut rates mind,
again, but in the back of his own few
mind, he has also said in the past few months, the question of a rate hears
cut is still on the table. When he don't
hears Warren Hogan say that, I dismissive.
don't think he would be totally is
dismissive. He would accept there again.
is a risk you might have to cut and
again.What do they know, banking I
and insurance economists will stop will
I am the hotshot around here, he need
will be saying. I know we won't he
need one. I'm not being facetious, view
he will respect you, as I do. My view is, if you guys are right, why was
is he screwing around waiting? If I the
was Scott Morrison, I would be on Treasury
the blower saying, I am the new Perhaps.
Treasury in town, cut the rates. difficult
Perhaps. The reserve has a perhaps
difficult balancing act here. It is I...
perhaps not as simple as Warren and something
I... You are trying to simplify complex.
something which is actually quite already
complex. The Reserve Bank has dollar
already done two cuts. Mail the they
dollar has fallen below the number some
they nominated, $.75. We have seen but
some rebalancing in the economy, Reserve
but right through last year, the stability
Reserve Bank said a period of interest
stability was appropriate for comment
interest rates. That was the last they
comment they made. And what did was
they do? The next thing they did because
was cut interest rates. Just something,
because the Reserve Bank has said set
something, it does not mean it is beyond
set in stone. We have to look and
beyond what the Reserve Bank says, view
and I guess Warren's view, and my I
viewmacro you are on one rate cut, decided
I am on -- he is on two.I had not two.
decided whether it is the one or rest
two. There is an argument that the countries,
rest of the world, the advanced We
countries, had had to go to zero. because
We were protected about that With
because we had a stronger economy. With the China boom, that has come towards
to an end, and we will gravitate wrote
towards that.I know I have been past.
wrote towards Glenn Stevens in the I
past. I hope he is still right, and Glenn
I hope you and Warren are wrong and mean
Glenn is right on this. It would you
mean the economy grows faster than if
you expect and what Warren expect You
if Glenn is right.That is right. opinion
You yourself had a difference of many
opinion with the Reserve Bank for were
many years.I was right and they it
were wrong.We could go in circles, I
it is a joke just -- judgement call. recession
I am not in the camp that has a idiots
recession is round the corner.Some idiots are saying that.Often when advertisement
I go on the internet is an out
advertisement that comes up, find your
out why it is inevitable to protect is
your money, lick here. This year it think
is recession 2015. The point is, I We
think this is all about the margin. would
We have an economy growing at 2%. I yet,
would say it is not strong enough in
yet, it needs a bit more help. I am in the relatively optimistic camp recession.
in the Australian economy, no pause,
recession. One thing does give me size
pause, the housing boom showing just
size -- signs of rolling over. Not building
just prices, but the level of approvals
building approvals. Building high
approvals are running at record going
high levels, they are probably not going to go much higher. If they go catch
sideways, housing investment will record
catch up to that.If there is record home improvement, is their a
record actual building?The lead is approvals,
a bit shorter, it goes from housing months,
approvals, to housing starts, 3-6 six
months, something like that.So in six months time, we will have a And
record amount of building starting? months.
And average build is at least 12 upside,
months.Starts have a bit more in
upside, but if approvals topped out probably
in the June quarter, then starts quarter,
probably top out sometime in this tops
quarter, and housing investment year.
tops out in the first half of next come
year. Alterations, additions might strength
come through and given extra big
strength to that. You have seen the matters.
big run-up, it is the change that the
matters. Housing starts have done out
the same thing. Momentum will come would
out of that. By now, we normally mining
would have started to see non- has
mining investment pickup, and that manager
has not happened.I heard a fund you
manager today, he was saying, well, do
you know, I don't think stocks will negative
do much for 12 months. Is that too scared
negative a view? He is probably instead
scared of ETS, people buying them Those
instead of investing in funds. around
Those things are always noise was
around the side, back in 1987 it say
was portfolio insurance. Now they ETS.
say it is computerised trading and ebbs
ETS. Through it all, you get these Our
ebbs and flows in the share market. recent
Our market has come down 16% to a level,
recent low. It went up to 6000 6000
level, 16% decline from that almost similar
6000 high level. Global markets, more
similar falls, a bit less in the US, going
more in Europe and Japan. We are the
going through the weakest period of October
the year, seasonally.Mid-September. bearer
October is often known as the into
bearer killer. Markets come down of
into October everyone is in a state end.
of panic, they rally at the year- against
end. When you put all that aside, cheaper
against the fact shares have become lower,
cheaper and bond yields have stayed globally.
lower, you have monetary using interest
globally. The US is not raising are
interest rates, they tell us they stuff
are knocking to do anything to my
stuff the world economy up.He is Italians
my kind of guy.I like to, the Mario.
Italians have saved Europe.Super conditions
Mario.You have very easy monetary about
conditions globally. This scare volatility
about the emerging world, there is Russia
volatility and concern. Brazil and slowed.
Russia are in recession, China has huge
slowed. It is not going to have the As
huge negative impact that many fear. to
As we consider China's economy as decent
to Ming out, we will start to see a were
decent rally at the year-end.We years
were at 6000, down, if over two it
years if we eventually get to 6000, being
it will be 20% return of two years been
being on the market.It would have will
been too bad. Some people watching but
will say, that is all very good, back
but they put the money in at 6800 the
back in 2007.Go on.The point is, no
the market then got to levels that no one imagined. At the start of we
the last decade, if anyone thought too
we would get a 6800... It went up of
too far, arguably, with the benefit of hindsight. But it hasn't been pay
too bad. You could argue now you yield
pay to own shares. The dividend flow
yield is 5.2%. What is the cash if
flow on bank term deposits? To .5% own
if you are lucky. You are paid to volatility,
own shares. If you cannot stand the there.
volatility, maybe you should not be their
there. Which companies capture Great
their dividends recently? Not many. from
Great argument, Shane. Shane Oliver he
from AMP Capital. Is there anything the
he doesn't know? After the break, Christopher
the man who do -- knows everything, Christopher Joye.

Money.
Welcome back to Switzer on Sky News housing
Money. We are being told that the boil
housing sector is going off the under
boil and banks share prices are blame
under pressure, and if I wanted to our
blame one person for this threat to our well, I would point my finger Christopher
at my old mate and AFR columnist make
Christopher Joye. Chris joins me to irresponsible
make excuses for his his bad and you?
irresponsible behaviour. How are read
you?Good.In case people do not highly
read you on Saturdays, which is housing
highly unlikely, you said we had a David
housing bubble. You want APRA and have
David Murray that we -- the banks they
have to get more capital in and Share
they did what you recommended. people
Share prices have gone down so The
people are poorer because of you. bubble
The house boom which you called a APRA
bubble is now threatened because encourage
APRA raised rates, which you brilliant
encourage as well. Although money.
brilliant observations have cost us long
money. What is your defence?In the prices.
long run, we want accurate asset boom
prices. I don't think the housing buy
boom has passed yet, and I wouldn't are
buy into the absolute baloney you that
are reading in mainstream media that we are going to see a sudden significantly
slump or that conditions have forecast
significantly deteriorated. I price
forecast strong double-digit house said
price growth. In 2013, everyone 2015,
said I would be wrong. In 2014, will
2015, I think the housing market not
will continue to power on. Perhaps data.
not the same rate but here is the rate
data. Last weeks auction clearance above
rate was 70% in Australia, well House
above the 60% average since 2008. months
House prices for the last three September.
months are up 3.6%, three months to annualised
September. To 22 September. On an annualised basis, it is 15% house
annualised growth. Year to date, 12-13%.
house prices have been rising at 2014,
12-13%. Year-on-year, 11%. In July have
2014, Glenn Stevens said that if we growth
have double-digit house price dramas.
growth we will have some real rates
dramas. It was just before he cut and
rates twice. The cash rate was 2.5% if
and he said he would be concerned That
if we saw persistence in that boom. seeing
That is exactly what we got. We are but
seeing a deceleration in conditions price
but we should get strong house the
price growth that will be 3-4 times the race right in wages growth. It will continue to get more expensive change
but I see no catalyst for any some
change until rates rise or we get think
some economic downturn. I don't good.
think either are looming.That is economic
good. You do not see a calamitous you
economic outlook for Australia, and will
you do not think interest rates call
will rise soon either.ANZ had a two
call in two rate cuts. ANZ called the
two rate hikes.You are nasty.When point
the RBA's cash rate was at the supposed
point it was in 2008, there were They
supposed to be two more rate hikes. basis
They were cutting by hundreds of The
basis points at the end of the year. think
The rate cuts for 2016, I don't rates
think they have any idea where comfortable
rates are heading. The RBA is quite position
comfortable with the current changer
position of policy. The key game Aussie
changer for the macroeconomy is the tremendous
Aussie dollar. 69 US cents, it is a The
tremendous tailwind for tourism. growth.
The RBA has changed its tune on over
growth. We have had economic growth decent.
over the year to date has been growth
decent. You are looking at nominal now
growth of about 4.5%. The RBA is 2.5%.
now saying the trend is now just trend
2.5%. Recently, the RBA said the expected,
trend might be lower than we had real
expected, with slower population... might
real GDP might be 2.5%. The economy we
might not be growing as slowly as closer
we previously thought. It might be time
closer to trend.That is the first justifies
time you have said anything that You
justifies my opinion but well done. time.
You are giving me joy for the first the
time.There are a lot of clouds on did
the horizon. The US Federal reserve because
did not raise right in September because they were concerned about pricing
the market price. Markets are pricing in a 30% chance of the trader
rates being hiked but every single to
trader and economist I have spoken disappointed
to has basically said that they are hike
disappointed that the Fed did not hike because they are worried what What
the Fed knows that they don't know. secularity
What do you think about that?The governments
secularity between markets and big,
governments is fascinating. We have easing
big, addicted to quantitative bailing
easing and the government is time
bailing out markets at the first addicted.
time of strife -- we have become raised,
addicted. When the rates were not that
raised, the markets were worried didn't
that the Fed you something they certainty
didn't know. Markets wanted a
certainty and a hike to say we have incredibly
a 5.1% unemployment rate in the US, according
incredibly low, full employment that
according to the Fed is higher than you
that level.In the bond market game, rates.
you don't mind raised interest portfolios
rates.I run zero duration portfolios which means our and
portfolios do well if rates go up The
and we are fine if rates go down. Australian
The ten-year interest rate on a Australian bond is under the 6%. telling
The yield curve, money markets are rate
telling us they do not expect any Glenn
rate rises for the next 10 years. is
Glenn Stevens, the head of the RBA, he
is pushing this even though he says believes
he cannot forecast the future. He you
believes rates will stay low.If you were Scott Morrison, would you positive
think about putting a much more have
positive budget in next year?I over
have been quite critical of Malcolm and
over the last week for Buttler -- I
and he has not been talking to me. great
I think he has done the nation a authenticity
great service in providing nailed
authenticity and clarity, and he leadership
nailed it. We need economic trust.
leadership and policy makers we confidence
trust. Business and consumer intellectual
confidence was suffering from the vacuum
intellectual and policy-making childlike
vacuum and this (BLEEP) for tat, pervaded
childlike schoolyard politics that has
pervaded Canberra. The fact Malcolm implicitly
has reset the tax review and said back
implicitly that everything will be his
back on the table and he has made much
his mantra one of instilling as possible
much confidence in business as support
possible and providing as much be
support to business as possible to to
be innovative and productive, and statistics
to have a command of economic about
statistics and talk with conviction day,
about the economic dynamics of the Morrison,
day, it is great. On the budget and tough
Morrison, the budget has to be objectives
tough in terms of its reform don't
objectives but at the same time I support
don't think it would hurt to economy
support those sectors of the pull
economy that need it.You cannot demand
pull demand out at a time where Scott
demand is not strong. I taught a
Scott Morrison.What was he like as thing,
a student?Very good. One last economy,
thing, generally on the Aussie you
economy, I am taking from you that about
you think when people start talking what
about a recession around the corner, what is your reaction?I am worried not
about a recession because we have generations
not had one for 24 years. Many lived
generations of Australians haven't that
lived through a recession and think a
that inflation is dead. Right now, should
a lot of the past economic data, it The
should give us grounds for optimism. construction,
The PMIs for services and which
construction, basically indexes in
which tell us what activity is like in those sectors, are both in quite a strongly expansionary territory. around
The unemployment rate is stabilised Housing
around 6%. GDP growth is OK. Malcolm
Housing construction is booming. We
Malcolm said this the other night. capex
We have come through the Cliff -- tremendous
capex cliff. There has been through
tremendous turmoil and turbulence OK.
through the world. But we are doing support
OK. The key tailwind that could Our
support growth is the Aussie dollar. with
Our businesses have been struggling cents
with a US 90 cents, 100 and 10 decade,
cents exchange-rate for almost a very
decade, and they have had to become manage
very productive and streamlined and cents
manage their costs. To have a 69 game
cents US currency is a potential date
game changer.I will write this Christopher
date down because it is important. today.
Christopher Joye, you gave me joy realistic
today. You are optimistic and realistic and accurate. Thank you. smarter
Christopher Joye from the AFR and up
smarter money investments. Coming there
up after the break, we will see if mining
there are opportunities in the mining sector.

are
Welcome back. The country's banks never
are targeting women customers like actually
never before. A bank like Westpac markets,
actually has a director of women's Onselen.
markets, her name is Ainslie van Thank
Onselen. Thank you for joining us. description?
Thank you, Peter.What is your job women's
description?And the director of inclusion
women's markets, the director of after
inclusion and diversity. Looking and
after all of our female customers, prosper
and ensuring they thrive and they
prosper in whatever initiatives to
they are doing.When banks decided of,
to do this, was that a reflection market,
of, this is a really important them
market, but we have been ignoring The
them for too long?That is right. cannot
The power of the female economy put
cannot be underestimated.Can you first
put a number on it?We were the women's
first bank to have a dedicated globally
women's market, and are recognised The
globally as a leader in this field. The initiatives we have put in Connection,
place, things like the Ruby the
Connection, open to all females in digital
the community. It is basically a education,
digital platform for women to get particularly
education, information, financial
particularly in relation to in
financial services. And decisions up
in relation to business, how to set advertise
up a business for example. They can it
advertise their own business on it, and
it is very interactive. I edit it the
and provide content as well. From perspective.
the bank's perspective and a health it,
perspective.That is one aspect of understanding
it, but give us another women
understanding of how important questions.
women are in determining financial but
questions. In the family instance, independently
but also when they are wealth.
independently developing their own financial
wealth.Great question. 80% of all are
financial decisions in Australia even
are made by women.I suspected that, guru,
even though I am allegedly a money who
guru, I have a treasurer at home 66%
who is more intelligent than me. the
66% of women of working age are in our
the workforce. At Westpac, 62% of our workforce is a women. Most women,
financial decisions are made by weeks
women, and a recent ABS study, two are
weeks ago, showed women businesses Australia
are the fastest growth market in the
Australia right now. The success of on
the Australian economy almost rests you
on the female economy.Obviously, nature
you would have thought through the potential,
nature of your existing, or of
potential, customers. And the kind or
of forces that have been victims of, On
or have been able to benefit from. women
On the nose and new nation for --
women when they retire is terrible. paternal
-- we know superannuation. Being a young
paternal character I say, tell super
young women to start investing in hard
super as soon as possible. It is a explain
hard sell to a young woman, to programmes
explain that too.One of our where
programmes is a university program teach
where we go into university and about
teach young women and young men they
about superannuation, and decisions implement
they can make. And what a good And
implement contract can look like. And some of the financial decisions just
they should be making. It is not therefore
just that women are taking breaks, super,
therefore they have gaps in their make
super, but studies have shown they superannuation
make more conservative choices in in
superannuation funds. They invest risky,
in asset classes which are less 20s
risky, cash etc. Really, in their at
20s and 30s, they should be looking behaving
at equity assets.They should be testosterone,
behaving like stupid man, driven by is
testosterone, I am a risk taker. It more
is true though, they should make are
more risky investments when they not
are young. Is it because they have program
not been open to the education clearly
program around money, which is clearly something we have to to
improve?It is definitely relating confidence
to education, but also having the empowered
confidence and ability to be decisions.
empowered by your own financial important
decisions. That is why it is so girls
important that young women, and education.
girls in particular, receive that the
education.I have always believed the best way of teaching people is who
to look at high achievers, people table,
who have gone from the kitchen like
table, created great businesses thing
like Steve Jobs. You guys have a Is
thing called 100 women of influence. models
Is that the idea that great role both
models might inspire other women, older,
both young and old, middle-aged or There
older, let's not discriminate. 50s
There are a lot of women in their 50s who still businesses as well. about
Is this part of the exercise? It is female
about celebrating and unearthing communities.
female leadership within the in
communities. It is not just women celebrities,
in power, or a women who are amazing
celebrities, it is women doing going
amazing things in their field, job.
going above and beyond their day that
job. There are classic examples of those
that in this year's category.Have it
those winners been announced?Yes, October,
it was announced today. On 15 at
October, we will have a gala dinner category
at the Sydney town Hall. The 10 will
category winners and overall winner Westpac's
will be announced.Obviously, Most
Westpac's website will have that. from
Most certainly.Ainslie van Onselen sector
from Westpac. With the mining what
sector under enormous pressure, companies
what is the outlook for a range of takeover
companies that might be murder and for
takeover targets? -- merger. Safety Tell
for joining us, Greg.Good evening. out
Tell us the outlook for the miners and
out there, either a lot of mergers market
and acquisition opportunities?The depressed
market is very active at the moment, of
depressed commodity prices, a lot generally,
of uncertainty around China, generally, uncertainty is probably to
the key word. People are reluctant end
to invest their dollars, the junior struggling
end of the market has been they
struggling for capital. As a result, you
they are certainly the targets. If rather
you look at the industry, generally, targets,
rather than picking out general principles
targets, if you look at the set of companies
principles about what makes great companies and what makes them looking
targets, it is probably worthwhile in
looking at a few different shocks interesting
in the market. One of the the
interesting ones happened today, on
the Volkswagen emissions scandal, certain
on the back of that we have seen Palladium
certain non-core elements like used
Palladium pop up in price. That is petrol
used in scrubbing emissions in analysts
petrol engines. Generally, the perhaps
analysts are suggesting that Americans
perhaps Europeans, certainly and
Americans might go away from diesel relevantly,
and back to petrol. And more Certainly,
relevantly, back towards batteries. electric
Certainly, two new hybrid and pop-ups
electric cars. That will see new lithium.
pop-ups in non-core elements like whole
lithium.If you had to look at the for
whole sector, how negative are you prices?
for the outlook for commodity Palladium,
prices? If so, you mentioned particular
Palladium, are there some people
particular areas where you think optimism
people should have a bit more Absolutely.
optimism for the outlook for price? about
Absolutely. I expect everyone knows The
about the gold industry, broadly. certainly
The place to look in gold is there
certainly among the mid-cap miners, around
there are some key principles around investing and understanding always
companies. Great management teams management
always work in this market. Good attracting
management teams are good at They
attracting that scarce capital. developing
They are generally very good at to
developing assets, and businesses they
to have confidence in them. What do good
they bring to the table? Generally, understanding
good quality resources, good la
understanding of development option reducers
la tea, by that I mean some of the financing
reducers which have not made their the
financing decisions, have not made example
the development decisions. A great resource,
example is Celsius in gold. Good lot
resource, good management team. A it.
lot of under utilised mills around with
it. Potentially, it can do deals and
with those mills to treat it there basis.
and be a producer on a low-cost conference
basis.We got together at a mining is
conference earlier this year. That show.
is why I got you to come on the energy,
show. What is your view on LNG, and discussed
energy, and all of the issues therefore
discussed at that conference and like
therefore the outlook for companies must
like sometimes and Woodside? You investment
must have your own personal position
investment review? Are you taking a basis
position on these companies on the be
basis of the current problems will certainly
be short-term?I think they the
certainly will be medium-term, with market
the way that apex approach the market with supply.

leaders,
Generally led by very strong understanding
leaders, they have a strong They
understanding of their markets. well.
They will always survive and do period
well. I do think we are in for a I
period created by that uncertainty interview,
I mentioned at the start of the interview, that will impact on them through
for a period of time. That flows LNG
through to companies not only on as
LNG space, but new companies such assets,
as South32, rate companies, great commodity
assets, but knocked around by Talk
commodity prices and uncertainty. innovation
Talk to us about KPMG resource and programme.
innovation Excel are rated segue
programme.That is properly a great discussing.
segue from what we are just Woodside
discussing. Companies like a Australia
Woodside have engaged with KPMG, in
Australia has been a great leader need
in the resources space. What we need to be now is a great leader in energy
innovation and technology around believe
energy and national resources. We to
believe strongly in that and want accelerator
to be a part of that. We created an have
accelerator called Energise, and we from
have secured resources companies joined
from oil, gas and mining. They have which
joined up with eight companies solutions
which are start-ups that provide We
solutions to the resources sector. infield
We think they are probably best drone
infield solutions, anything from remote
drone technology, collecting data, through
remote area monitoring, right conveyor
through to live change at of their
conveyor belts. Actually while things
their functioning, delivering, remarkable
things like that are quite industry.
remarkable and unheard-of in the lot
industry. There are going to save a this
lot of money, but more importantly, innovation
this program is all about helping
innovation and technology. About ups
helping those people, those start- the
ups understanding the problems of those
the majors. Helping them solve potentially
those problems, bring the cost down, to
potentially increase their licence majors,
to operate. Importantly, for the Big
majors, it helps with innovation. good
Big companies are generally not as like
good at innovation as we would all innovation,
like to be. This teaches them about and
innovation, gets them engaged in it, create
and I think it is a great way to going
create jobs rather than simply any
going out and cutting costs.Are companies?
any of those start-ups listed companies
companies?No, they are all private concluding
companies and KPMG will be two
concluding that programme in about Silicon
two weeks' time. Entrepreneurs from be
Silicon Valley and Australia will winners
be there. We will be announcing the joining
winners on 6 October.Thank you for www.energise.
joining us, the website is www.energise. KPMG. AQ.

the
After the break we will get inside mind
the on, located but sophisticated mind of Rudi Filapek-Vandyck.

sense
Welcome back to Switzer. To make work
sense of this volatile market and about
work out how scared we should be Filapek-Vandyck
about stocks going forward, Rudi worried
Filapek-Vandyck will tell us how That
worried the analysts he watches are. Yes,
That is what you do, watch analysts. nice
Yes, and economists. It is quite a alternative
nice intro, Peter. I can give the from
alternative view from the inside analysts
from the analysts' minds.The It
analysts are sneakily working away. is
It tells us what is going on and it This
is in the Switzer Super Report. what
This is what is going to happen, Ever
what is happening at the moment. have
Ever since we left 2014, forecasts

company
Constantly sliding. We are talking growth
company profits forecasts, economic a
growth forecasts, everything is on market
a sliding path. For a while, as ignored
market participants, we have attention
ignored it. We started paying some
attention midyear and it spooked I
some people.5995, and you know how Forget
I have been looking forward to 6000. being,
Forget about 6000 for the time ongoing.
being, but that trend is still example,
ongoing. That is the bad news. For changed.
example, today the forecasts TWICE
changed. Anzac bank said are being That
TWICE next year -- will cut twice. forecasts
That had an effect on growth Forecasts
forecasts of emerging markets. animal
Forecasts can only focus on one and
animal at a time. It is like men and teenage boys. The most

right-hand
Element is it is happening on the and
right-hand side and not the left, panning
and that is the way things are worry
panning out. It is turning into a On
worry for quite a number of people. On the right -- fill in both.

team
The head of the global economics Yes
team at city.He is very negative. predict
Yes but he also thinks he will recession
predict -- he predicts a global the
recession next year. This is one of these
the problems. One problem is how by
these forecasts are being reported The
by the media, often very clunky. technology
The other problem is we all use technology but we don't always mean terminology.
the same thing -- we all use 50%
terminology. He says it is beyond rising
50% chance. The risk is high and there
rising every day. 55% already.If that
there is another recession in 2016, kicked
that expert will get his butt thing.
kicked on this program.Here's the is
thing. Recession in his technology prolonged
is not negative growth but a prolonged time of subpar growth.He basically
is redefining economics.He's of
basically saying, as an extension more
of the trend right now, more and conclusion
more analysts are coming to that growth
conclusion 2016 will see slower problem.
growth than forecast. That can be a me,
problem. It can become a worry.To what
me, this is just a definition of three
what Tanya Brand said on this show long
three years ago. It will just be a sideways
long grind home. There will be expert
sideways movements. One thing that will
expert doesn't know is what Beijing They
will cut up to the next two months. everyone
They can come along and shocked I
everyone and nuke this whole thing. From
I would be surprised if they do. analysis,
From my observations, from my China
analysis, the best way to look at Belgium
China is the same way you look at a
Belgium or France or Greece. It is is
a country with too much debt. That any
is the reason why they will not be ANZ
any bazooka stimulus from China. case
ANZ today said the same thing. In term
case they do, it will be a short- down
term fix and will create problems country
down the track.When you have a export
country that is one of the biggest they
export earners in the world, when money,
they are lending themselves the fish
money, it is a different kettle of fish than Belgium or France because They
they have foreign lenders as well. have
They do. A lot of Chinese companies environment
have used the low interest rate has
environment of the US because China has higher interest rates. Anyway, on
there is a whole discussion going economists
on in economics land. There are that
economists who will tell you and me debt
that there comes a point that the and
debt in a country becomes too large string
and it automatically becomes a Japan
string -- a constraint on growth. case.
Japan is now -- has been a classic now
case.Experts are saying China is to
now the classic case.I am not used Sometimes
to use caring my audience. hope
Sometimes you can be wrong and I hope you are wrong on this case -- your
to you scaring my audience. This is scary
your function. Not playing the manager/economist.
scary Roger Montgomery fund times?
manager/economist.Is he scary at listen
times?Yes, about China. If you note
listen to Jimmy channels, you will by
note about that. If you were scared have
by Jimmy five years ago, you would would
have stayed in term deposits and going
would have missed the stock market Fortescue
going up.You would have avoided that.
Fortescue and he was right about scared
that.One company. If you are altogether...
scared out of the markets these
altogether... let us not praise How
these hedge fund managers too much. and
How do we invest now?Cautiously developments.
and nimble and watch for where
developments. This is not a time automatically
where you try to be a hero. Don't everything
automatically assume that better
everything that falls in prices a sometimes
better bargain. I cannot help but when
sometimes have a bit of a smirk low
when I hear that there is another '20s,
low for Santos and Woodside in the That
'20s, BHP low 20s. I am not there. you
That is the way to go.What about loading
you all whether stocks? Are you reluctant
loading up?No, but I would be care,
reluctant to sell Ramsay health the
care, into care, those stocks. If I
the proverbial hits the fan, maybe am
I might have to, but at this time I question,
am happy to hang on.That is my cash
question, are you saying we should stock
cash out and get out of the crazy are
stock market? Will it hurt you or another
are you giving this stock market expect
another couple of years? Just don't I
expect it to shoot the lights out. out.
I do not expect to shoot the lights a
out. We should be mindful we are in not
a process where we will find out bad
not only how bad it can get but how guarantee
bad it will get. No one can point,
guarantee you and me that, at some pockets
point, it will not really hurt our Something
pockets because markets can do that. is
Something we haven't spoken about Volkswagen
is what is happening with underestimate
Volkswagen in Germany. We tend to Australia.
underestimate things like that in consequences.
Australia. It can have major where
consequences. This is a process fight
where we will all find out...Don't considerable
fight the Fed!They showed a undermined
considerable lack of leadership and world.
undermined confidence across the real
world. I think they are creating a is
real conundrum for themselves. What and
is the US economy doing for years year
and years? They start each calendar not
year on a week footing. If they do looking
not raise by December, we might be looking at the middle of next year. in
We could have really weak figures will
in the emerging markets and they elements
will not raise. That is one of the risk
elements that it will be bad for been
risk assets.I think you might have recently
been the Christmas Grinch.I was you
recently asked, and I said that if portfolio
you have a portfolio now, and every portfolio...
portfolio has been hit, every done
portfolio... every portfolio has get
done is -- bad decisions. You can stuff.
get rid of those.Load up on good want
stuff.What you want is cash. You the
want to buy at lower prices when into
the price is right. If things get How
into a situation, you need cash. Can
How low can the ASX 200 index go? all
Can I...We broke through 5000.It should
all depends. Nobody knows this. We may
should be prepared for scenarios we Turnbull
may not like.I hope Malcolm you
Turnbull at China rescue us. Thank you for coming on the show. Thank will
you for joining me on the show. I great
will see you next week. Have a of
great weekend. Don't forget, best of Switzer over the weekend.

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