Paul
Kelly writes: “REVOLUTIONARY changes in the global market, driven by huge skill
shortages in the rich nations, present Australia with its most important
immigration policy challenge for 50 years and constitute a decisive test of our
political leadership…The new politics of immigration is about to hit
Australia. In the coming century, rich nations will succeed or fail according to
their immigration policy. This should leave Australia well
positioned”.

As an economist,
Henry says “Hear, hear” to this, as he has argued. This century will see a
battle for talent – attracting talent from abroad and retaining young
Australians who will be tempted to live and work
abroad.

Tim
Colebatch from The Age recently wrote a super article on the two polar opposite systems of
labour laws:

“One was the
American route: weak unions, individual wage bargaining, minimal protection of
employees, and minimum benefits or retraining for the unemployed…The other was
the Scandinavian/Austrian path: strong unions, centralised wage bargaining,
extensive regulation to protect workers, generous dole benefits and retraining
schemes.”

Colebatch,
obviously in opposition to the IR reforms, concludes: “What was different
between the two paths to unemployment, the OECD noted in passing, was that the
Scandinavian model produced a more equal society, with less of a gulf between
rich and poor.”

And onto the
markets, the latest Raff Report works through the numbers and points out that global demand for commodities is
still growing strongly and that inventories have begun falling
again.

In the
US, the markets were up (equities 0.7
% up at one stage) but ended down slightly on Friday night when a rumour swept
Wall Street that the Fed would raise rates by 50 basis points. Apparently
markets are pricing in a 10 % chance of a 50 basis point hike, but at the same
time a higher number of experts is predicting two back-to-back 25 basis point
hikes.

Bond yields
continued to rise, and metals prices were mixed. So markets will all be waiting
nervously on the Fed.

More reading at
Henry Thornton.