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The ASX 200 is shown below. It's possible the Australian economy is going to do better than the UK economy over the next year. But the recovery from the dip in February and March seems to have stalled. Whilst one never knows the future, my guess is that the big US tracker ETFs like £EQQQ and £VUSA are better bets than the Australian ETFs.
Thanks for your reply. Appreciate your engagement wilkonz. I agree with you that over the longer term it's hard to see beyond the US markets for growth prospects.
For this angle, it was the relative seasonality wrt the virus I was considering mainly against the data that shows suppression is easier during hotter months. With the southern hemisphere now coming into the summer months, could it be that the recovery there will begin to gather steam, as it did in the northern hemisphere as we entered the Summer months, before it appeared to stall as we entered Autumn & approach Winter?
Of course it is entirely possible that the other event risk could just be currently clouding the issue in US markets.
Australian winters tend to be warmer than British winters, especially in the north. So I suspect the climate effect on Covid will be less marked than in the UK. Australian indices might do very well over the next decade, but nothing much happening at present. My money is staying in the US for the time being.
Australia controlled the virus much more than we did at an early stage, they had quarantine for anyone coming back from overseas back in March, we had no controls. Hence they had far less cases than us. We let lots of people go to Italy at school half in the spring.
Australia is a very commodity based economy, so a lot depends on the world economy, if there is a recession I would not want to be invested in it. The US could take another correction, I’m waiting to see a clearer picture but will be investing more in the US when things settle down.
The other matter to consider is the current trade war between China and Australia. If China stops buying Australian goods, it may damage the Australian economy.
I think this is fair comment wrt to macro economic theory in that when global growth is occurring, money/investment flow tends to increase from the main economy (China) to the perimeter economy (Australia) and contracts when in recession.
Interesting to note though that China are lower on the list than I expected in terms of foreign investment into Australia. I wonder also if Brexit will prove to be positive in terms of UK --> AUS investment flows.
https://www.theguardian.com/au...
"More than one out of every four dollars invested in Australia from overseas comes from the US, with such US investments totalling $984bn."
The move towards electrification of the planet and precious metal bull markets should also see Australian resources continue to be in demand , but much will depend on the commodity cycle as Herbie has alluded to.
