Economy

Are Things Back To Normal?

Reading Time: 2 Minutes

MrsFrugalSamurai told me an interesting story today.

Whilst she was at the shops, an elderly lady was using her umbrella to maintain social distancing in a “forceful manner”.

Apparently the sheer number of people going about their business made this a thankless task.

I can just imagine our heroine, battling against the horde with her brolly-cum-sword like a crazed Mary Poppins.

I guess the moral of the story is that we’re all heading outdoors now and everything is back to normal?

Certainly it’s not true in other parts of the world, where escalating cases in the US, Brazil and India among others makes COVID-19 as big of an issue as when it first hit.

But in Australia, through great fortune – we seemed to survive the initial (and hopefully final) wave.

To support this, I stumbled onto some pretty cool graphs ANZ Research has provided, to highlight that for most of us, we just want to get back to normal.

Here is a select few…

Chart 1 – Australians are willing to head out

A bit self-explanatory, but looks like we are increasingly likely to plug in different destinations in our smartphones. Apple maps shows a huge drop-off during March-April, and been steadily increasing since.

Chart 2 – People are going back to restaurants

This chart compares the percentage of bookings versus the same period last year. So you can see that through the social distancing and lock-out period, there was a 100% decline compared to the same period last year. In the last few weeks, that figure has risen to around 40-50% decline, or about half the same volume of bookings as last year, not great, but the trend is better.

Chart 3 – Airbnb getting almost as much attention as in normal times

This figure shows the number of Airbnb queries on Google has come back almost in line with previous years. Which is good news for domestic locales as we will be travelling domestically for the foreseeable future.

Chart 4 – Searching for unemployment benefits is broadly back to normal

Google searches for the term “unemployment benefits” seem to be largely back to normal – you can see the huge spike during March and the subsequent drop-off as the economy has eased itself back out. Also the Jobseeker and Jobkeeper stimulus measures the government initiated has largely contributed to the easing of the unemployment lines.

Chart 5 – Still plenty of economic concern

This one is the big one for me, you can see that Google searches for the term “recession” has skyrocketed. First when the lockdowns occurred in March, and then most recently when it was called by the federal Treasurer Josh Frydenberg that we are in recession. Personally, I am curious to see what comes of Australia falling into recession for the first time in nearly 30 years, and the fall-out of that.

Chart 6 – Interest in car sales has surged

Although if you look at this chart, interest in car sales has actually stormed back to normal. Car sales (and especially new car sales) is a bellwether (a cool economic term for: trendsetter) for the economy. This is because a car purchase is usually a big ticket item for most households. People generally buy cars when times are good, and stay away when there is economic uncertainty. Given interest levels has rocketed back, it’s a positive sign for consumer sentiment.

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Pretty cool insights I think, it is very pleasing that our population feels more confident.

This is extremely important because at the end of the day, it’s not demand vs supply, or a company’s profitability, or foreign investors, or quantitative easing, or the myriad of other factors that drive our nation’s economy.

No, it is sentiment.

If we don’t feel confident, we don’t spend. Simple as that.

So sorry Mary Poppins, but looks like you’ll be doing a lot more battling in the foreseeable future.

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