Tuesday, 5 March 2013

Real victims in currency wars

While the RBA and the banking industry have been showing off their resilience to the ebbs and flows of currency markets, in the space of the real economy, real businesses are going to the wall. 

Focussing on the iconic sauce maker Rosella this Bloomberg piece said:

....Rosella’s receiver today said it was unable to find a buyer and will shut the saucemaker, leaving 70 workers without a job. The failure -- along with receiverships at book seller Angus & Robertson, founded in 1884, and Allans Music, in business for 16 decades -- illustrate Australia’s lopsided economy. A mining- investment boom is delivering the quickest growth in the developed world even as it masks other weaknesses....
....“It’s disappointing that these Australian icons are either disappearing or being severely diluted and undermined,” said Kumm, who spoke before today’s announcement. His great- grandfather Frederick Cato helped found the company in 1895. “We’re used to seeing those things on our shelves and there’s a sense of belongingness.”....
Bob Gregory, a professor at Australian National University in Canberra and former central-bank board member, predicts joblessness will worsen this year. The investment phase of the mining boom, which has been construction-oriented, will wane and government-budget cutbacks will curb infrastructure projects, hurting workers without college educations, he said....Some blue-collar enclaves in Australian capital cities already have unemployment approaching recession-plagued Spain’s record 26 percent...(here)
Meanwhile for another consumer retail business, footwear there was also bad news:
...SHOE Superstore is the latest retailer to fall into administration as the chief of parent company RCG Corporation warned that some sections of the consumer market were still reeling from the impact of the global financial crisis....RCG put Shoe Superstore, which includes nine stores employing about 50 staff, into the hands of administrators yesterday, less than four years after it acquired the business... (here).

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