Happy Christmas

It’s true, at least in relative terms.

As we get older the years get smaller which makes them seem faster.

For example, one year for a ten-your-old is ten percent of their life while for a fifty-year-old it’s only two percent of their life.

And gee it flies!

This time three years ago I remember speaking to a mate of mine who was at breaking point.

He’d been belted by drought and could no longer afford to feed his dogs let alone his last few head of cattle.

His family had already moved off the farm because there was no water left and he’d decided a box of bullets was the best thing for his dogs.

Sadly, depression can do that to people. They eventually only see one option.

Meanwhile, the bushfires were tearing through the east coast of Australia like a massive fire ball.

Visions of decimated homes and burnt koalas inspired concerts full of people to make pledges it would never happen again.

And then covid reared its invisible head about a month later and no one spoke about the fires or the charred koalas ever again.

It happens every time. We move on quickly.

A similar thing happened leading into Christmas last year. It was impossible to go from here to there without someone bending my Bitcoin ears. It’s all people wanted to talk about.

So for my final Moowsletter I jokingly wished everyone a ‘Merry Crypto’ and the Bitcoin believers cheered even louder!

A month later Bitcoin crashed like a dropped pie and all the crypto cuddlers disappeared into oblivion.

In March, I took a call from someone who asked me three times if I was willing to admit I got the call on interest rates wrong because they hadn’t gone up the way I’d been warning readers.

I can only assume he believed the RBA when they said rates wouldn’t go up until 2024 and he borrowed more than he should have at the top of the market…hoping like hell I was wrong.

Who knows.

What we do know is rates have gone up for eight consecutive months since April and all indicators suggest they’ll go higher in the new year.

Unfortunately, that’ll spear us into a recession and it won’t be the usual garden variety type either.

The truth is, and I’m not going to be very popular for saying this, but we need a good recession to suck the excess out of the economy and knock the top off inflation. It’s our only hope.

And if that seems harsh, just think of all those people on fixed incomes, especially pensioners. Their quality of life is currently getting squeezed at every turn thanks to inflation.

Consequently, 2023 will be the polar opposite of 2021. And most of the pain will come from debt (repayments) and decarbonization (gas and power prices).

The good news is most recessions only last three hundred days, on average.

And we’ll get through it. We always do.

Covid proved that success is usually just on the other side of what we think is the end.

And that’s exactly what happened to my mate three years ago.

Just when he thought he was finished, the drought broke and cattle prices shot to the moon.

And his dogs have been barking happily ever since.

Thank you for your readership throughout 2022. May I wish you and those close to you a very happy Christmas and all the very best for 2023.

The next Moowsletter will arrive on Australia Day at 12pm.

Have a great weekend!

Adam