“In Australia, consumer spending, historically, has been about 50% of GDP. This year it's been closer to 80% of GDP growth. There seems to be a view that, well, the RBA’s … more or less done what it’s gonna do. I think what the market's missing, though, is there's a huge lag from when the RBA increases rates to when households actually have to pay the higher interest rates.”

Touchstone’s portfolio specialist, Ron Sargeant, speaks with Bennelong Account Director, Holly Old, about current consumer spending and what it means for the economy, why secular stagnation matters, the impact of higher earnings, and Touchstone’s cautious outlook for reporting season.

We cover:

• 1:03 – Touchstone’s philosophy and investment process
• 2:37 – Ron’s observations from his recent Melbourne trip
• 4:23 – What secular stagnation is, and why it matters
• 6:16 – The real reason consumer spending is going down
• 8:31 – The impact of earnings being too high for consumer companies
• 11:33 – What Touchstone expects from the upcoming reporting season

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