The long drop is referred to as a outhouse or outside toilet. Australia economy can not be judged by its screaming higher Aussie Dollar, the only companies making any money are resources and energy sector digging up stuff for China. Everything else is in the doldrums.

Source: Alarm bells clang on Oz economy

Extracts

Signs of trouble in Australia's retail sector set new bells ringing for an economy whose fortunes now rest largely with mineral and energy resources and the health of China, and which beyond this is slowing to a disturbing degree.

Even the politically armored optimism of Treasurer Wayne Swan is showing dents.

He said the high Australian dollar was holding back sectors not tied to the mining boom, and was a burden for many industries, such as manufacturing and tourism.

The Senses business index showed similar gloom: one of the largest quarterly falls in business confidence in the report's 18-year history.

"We have really only seen business confidence lower during the peak of the global financial crisis and during the introduction of the GST," report author Christena Singh said.

The nation's households are equally pessimistic. The Westpac-Melbourne Institute index of consumer sentiment dived by 8.3 per cent in July to its lowest level since May 2009, reaching the depths plumbed after the GFC and the introduction of the GST.

"We have seen 11 falls of this magnitude since the early 1990s recession, but only two of them have been from a lower starting point," Westpac chief economist Bill Evans said. "Furthermore, such large falls have typically been associated with a major event such as an interest rate increase, a spike in petrol prices, the collapse of Lehmans, or recession fears."

COMMENTS: We believe the next big winner is SHORT the AUDUSD or Aussie dollar ETF (FXA). The long term cycle is ripe for roll over.

Ref: China slow down can it be managed?