The Turnbull Government has degenerated into a circus. It’s somehow actually worse than the Abbott Government. At least the latter had method even if misdirected by troglodyte ideology. The Turnbull Government has no discernible values at all and no method, either! Witness the progression of policy since Malcolm Turnbull’s rise. He came to power with a very clear vision: Ultimately,
From Moody’s: Australia’s Focus on Spending Cuts Makes Balancing Budget Difficult Last Friday, Australia (Aaa stable) Treasurer Scott Morrison announced that the budget to be released on 3 May would focus on curbing spending to lower the government’s fiscal deficit. However, given previous difficulties in reducing welfare benefits, actual spending cuts may be modest. Moreover,
By Leith van Onselen John Roskam, Executive Director of the right-wing think tank the Institute of Public Affairs (IPA), has led a vicious ad hominem attack against a large group of commentators whom opposes cutting the company tax rate. From The Australian: A high-profile group of unionists, academics and former public servants who oppose a
From The West Australian: Fortescue Metals Group and Vale could start bulk trials of blended ore with Chinese steel mills within a month. Fortescue chief executive Nev Power said yesterday he hoped the iron ore major’s joint venture would be selling product by the end of the year. Mr Power told analysts the two companies
Again from Matthew Stevens: ….Australian banks, in particular, were left “incandescent” when McGrathNicol’s appraisal of the confronting proposal identified that GSO and Arrium management planned to close the Whyalla steelworks. …Arrium’s lenders have become deeply sceptical of a narrative that would sustain the closure of Whyalla and the iron ore mines. That scepticism is apparently
From the excellent Jonathon Mott at UBS: Single name exposures (Bad Debts) to dominate the 1H16 Results The last few months have seen a handful of large, high profile corporate collapses. In some cases the companies have entered administration, others are in ongoing discussions with their banks. While underlying credit quality of the Australian banks
From Business Standard: Iron ore production is on upswing as many mines have started operating after a few years of suspension, following Supreme Court orders. According to provisional figures, India’s iron ore production is estimated to go up nearly 20 per cent to 155 million tonnes in 2015-16. Imports plummeted 62.9 per cent to 5.6
After the Office of the Chief Economist’s disgraceful iron ore outlook released last week, David Uren takes up the debate over iron ore and the Budget today: Last year’s budget described the fall in the iron market as “the largest single contributor to writedowns to government tax receipts”. The iron ore price was above $US120
By Leith van Onselen New Australian research co-written by the Obesity Policy Coalition and the University of Queensland’s School of Public Health has found that a 20% tax on sugary soft drinks could raise $400 million a year, reduce annual health expenditures by up to $29 million, and save more than 1,600 lives over 25
by Chris Becker Risk is back with a vengeance as an unexpectedly good Chinese trade data print results in a huge bid in equities and bonds coupled with rising oil prices and a strong start to US earnings, particularly banks. Asian stocks led the charge and European bourses took up the bit and while US stocks
So says Macquarie: On April 17th, OPEC members as well as other major producers have been invited to attend a meeting in Doha, Qatar to discuss a potential deal to freeze crude output at January levels. Logistically, we view a positive outcome from the Doha meeting as unlikely, given the following: Iranian
By Leith van Onselen It’s great to see the mainstream media finally discussing the elephant in the room: the Australian economy’s over-reliance on third-world immigration levels, which is causing all kinds of indigestion and reducing living standards for the existing population. Here’s Josh Gordon, State political editor for The Age’s, take on the issue: Victoria’s
By Leith van Onselen With the release yesterday of the state investor finance data for February, it is now an opportune time to once again plot total finance commitments (excluding refinancings) as measured by the ABS against dwelling values as measured by Core-Logic RP Data. First, below is the national picture, which shows finance approvals
By Leith van Onselen With the ABS releasing its dwelling commencements and completions data for the December quarter of 2015, it’s an opportune time to once again examine how dwelling construction is tracking against population growth at the national and state and territory levels. The below charts track the following, which are based on the
By Leith van Onselen Professor Ross Garnaut fronted the Melbourne Economic Forum yesterday and warned that the Government would be unable to bail-out the banks again if another Global Financial Crisis (GFC) hit. From The Canberra Times: The local banks’ reliance on offshore funding left them in trouble when the 2008 global financial crisis hit.
Today it feels like markets have declared the Mining GFC at an end. The US dollar rushed higher: Yen and euro got the treatment they deserve: Commodity currencies fell: The driver, oil, pulled back: Base metals surged: Miners went berserk: Freeport-McMoran, a large copper producer, saw its CDS price collapse: US and EM high yield
From Bloomie: Peabody Energy Corp. filed for bankruptcy on Wednesday, the most powerful convulsion yet in an industry that’s still waiting for the coal market to bottom out. …The outcome of the case may turn on what trajectory coal prices take over the course of the reorganization, with battles over environmental obligations and non-bankrupt Australian operations
Iron ore charts for April 13, 2016: Spot up again with Tianjin benchmark 2.4% to $59.90 but much less than yesterday’s rise in paper which did not add to gains overnight. With iron ore at $60 again my guess is the latest surge will now peter out again. Even so, rebar is still charging and,
Brent oil pulled back last night on a range of factors but not very far resting at $43.94 as I write. Henry Hub is joining the party again, up to $2.04mmBtu: In the news there was more OPEC rumourtage but more important were the IEA and OPEC monthly reports, from Oil Price: OPEC’s monthly oil
Cross-posted from Investing in Chinese Stocks. A new article originally published in the Beijing Daily says price cuts are appearing all over the city as sellers find no takers. Buyers are in shock at the volatility, retreating to the sidelines to see how it shakes out. iFeng: 北京楼市调查：房子挂牌两天 降了二十万 The first day of listing price
Yesterday’s Chinese trade data contined this rather amusing chart, from Tom Orlick at Bloomie: Chinese capital flight sure ain’t stopped, it’s just bleeding out through bogus invoicing in the trade account not the capital account. As some offset, Chinese authorities are again tightening on the latter, from SCMP: Beijing will intensify its crackdown on the
Global Macro / Markets / Investing: A Progressive Logic of Trade – Project Syndicate The Most Complicated Stocks – A Wealth of Common Sense Why Monetarism Failed – NY Times Is Cheap Oil Contractionary? – NY Times Why no economic boost from lower oil prices? – EconBrowser IMF Warns of Threats to Financial Stability – IMF The IMF delivers a stark
Chris Weston, Chief Market Strategist at IG Markets The bulls are firmly back in control of sentiment at present, but the risk of a reversal remains a threat. For now, the re-test of the March highs ($42.49) in US crude has seen investment-grade credit spreads tighten some six basis points, high yield credit tightening up
Cross-posted from The Conversation: Having a degree has become a basic prerequisite for most careers. Those without a degree are more likely to be disadvantaged in career and economic terms. You could think of this as somewhat like mobile phone ownership. Twenty years ago, those of us without a mobile phone got by just fine
By Leith van Onselen Last month, I flagged that the South Australian Government was planning to place further restrictions on fringe urban land supply in an attempt to protect agricultural land from development. Yesterday, the State Parliament passed these laws, thus tightening the state’s various urban growth boundaries across Adelaide and regional towns. From The
