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Sydney joins UBS global property bubble top five

Says UBS via WSJ: “All European cities are overvalued, apart from Milan,” the report said. Central banks in theU.K., Canada and Australia are also keeping interest rates low. Combined with stable supply of homes and strong demand from foreign buyers, especially in China, “this has produced an ideal setting for excesses in house prices,” the

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NSW’s long stamp duty boom draws to an end

By Leith van Onselen At the end of August, the NSW Parliamentary Research Service released its Trends in NSW State finances: 2002-03 to 2016-17 report, which showed that rising stamp duty receipts have driven much of the increase in state government taxation revenue over the past 14 years, accounting for 36% of total taxation revenue

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SQM Research questions “suspect” CoreLogic index

From SQM Research’s free weekly newsletter: The whole confusion and debate about housing price measurements keeps rolling on, largely at CoreLogic’s expense. The debate was reignited once more when the Reserve Bank of Australia (RBA) realised that CoreLogic were trying to rejig their Daily Home Value Index in mid-year and did not tell anyone publicly, including the RBA

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Daily oil and LNG price update (no deal)

Brent oil was clubbed lower to $46.41. Henry Hub is still warm: The OPEC freeze has now reached its inevitable denoument, from Bloomie: As producing countries gather in Algiers for talks on Wednesday, Saudi Arabia signaled for the first time it may accept the idea that Iran keep output at maximum levels but doesn’t expect

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Official panic begins over Chinese property bubble

From Investing in Chinese Stocks: On September 19, Hangzhou announced buying restrictions: The city authorities said that, effective from Sept 19, homebuyers without household registration in the city-known in Chinese as hukou-are not allowed to buy a second home in the city’s central districts, in a bid to curb rapidly rising house prices, curb speculative

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Links 28 September 2016

Global Macro / Markets / Investing: Desperate Central Bankers – Project Syndicate The Return of Fiscal Policy – Project Syndicate Inequality: the very long run – rwer.wordpress.com A New Debate Over Pricing the Risks of Climate Change – NY Times OPEC May Finally Be Willing to Curb Oil Glut, Just Not Yet – Bloomberg A Secret Debt Club Gets Pried

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Macro Afternoon

by Chris Becker A mixed day in Asia as traders watched in horror as the first US Presidential debate unfolded on their screens, with the Mexican Peso jumping on the result, as other safe havens like Yen and bonds sold off quietly. Stocks were generally boyous, reversing the sour mood overnight as the markets love

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More Chinese cities tighten housing policy

This is what is driving falls in iron ore today. Cross-posted from Investing in Chinese Stocks. Only four years ago China was worried about overheating housing markets. Then it was worried about a crash. Now it’s back to overheating. China Daily: Nanjing further tightens control on property market Nanjing, capital of East China’s Jiangsu province,

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The great property fluffing continues

And here it is at the AFR: Only scraps were left after another mid-week auction in Sydney cleared out on Monday night. Buyers, particularly babyboomers and upsizers, continue to overwhelm agents with demand for property as nine out of 11 properties worth more than $14 million sold under the hammer at the Double Bay auction centre. Over in the southwest, all ten properties

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Sydney First home buyers facing record deposit gap

By Leith van Onselen Escalating home prices against sluggish wages growth has driven the deposit gap facing Sydney first home buyers (FHBs) to record highs, according to new research from Deutsche Bank. From ABC News: Research by Deutsche Bank’s chief Australian economist Adam Boyton shows it would take a 25 per cent drop in Sydney

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Hillary pwns Donald

My personal view is that Hillary Clinton just pwned Donald Trump whose only pitch was that he knew how to run a business. She was assured, unflappable and accomplished. He was bumbling, blustering and out of his depth on many subjects. Three of those debates and The Donald will be toast. The USD fell, the

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Big Iron falls with Dalian

Dalian is down 2% today taking Big Iron with it. BHP is -1.3%, RIO -1.2% and FMG -1.8%: This despite upgrades from MS: Bulking up in 2016-17: The Commodity price revisions – “Global Metals Playbook: 4Q 2016” – are most pronounced in the bulk commodities. These are the materials thathave benefited most from the stimulus

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A look at the future beyond car making

By Leith van Onselen The shutdown of Ford Australia is imminent, with the last car to role off the Broadmeadows production line at the end of next week, with the loss of thousands more manufacturing jobs. With this deadline looming, ABC’s The Business aired an interesting segment last night looking at the End of the

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Where’s the fiscal pulse at?

From Macquarie:  A rotation towards public infrastructure investment is an anticipated swing point in the non-mining economy’s transition. For many reasons, an upswing in public investment is highly anticipated.  Has the public upswing already arrived? Infrastructure investment by State and Local Governments accounted for 80% of the recent 2Q16 GDP growth outcome –

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Trump to hit commodity prices

From CBA: The US dollar tends to rise in times of uncertainty, stemming from a flight to safety. Market expectations that Trump will implement policy that is largely inflationary will also likely boost the US dollar. A stronger US dollar will apply downward pressure on commodity prices, as US$ denominated assets become more expensive to

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Coalition flags funding cuts to elite private schools

By Leith van Onselen Back in June, the Centre for Policy Development (CPD) produced a report entitled Uneven Playing Field: The State of Australia’s Schools, which projected that under current policy settings, mid-range private school students are on track to receive $1,000 more in taxpayer funding than average public school students by 2020: The report

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Coalition to crackdown on private VET rorting

By Leith van Onselen Following scandal after scandal, and a blow-out in students’ debts to $3 billion from about $300 million in 2012, Federal cabinet will today consider policy options such as restrictioning access to loans for courses run by high-risk private providers, more scrutiny of students’ ability to complete a course, and changes to

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Daily oil and LNG price update (Libyan charge)

The Brent oil price jumped overnight on the usual freeze hopes to $47.54. Henry Hub roared to $3.07mmBtu: The freeze is still dead, from Iran via the WSJ: Iranian officials played down expectations for an oil-production deal, calling an OPEC gathering here this week “consultative,” and renewed their vow to pump output higher. Iran Oil

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Flood of dodgy Chinese money has AUSTRAC worried

By Leith van Onselen Let’s recall last year’s report from the global regulator, the Paris-based Financial Action Taskforce (FATF), which warned that Australian residential property is a haven for international money laundering, particularly from China, and recommended that Australia implement counter-measures to ensure that real estate agents, lawyers and accountants facilitating real estate transactions are

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The new hawk at the RBA

From UBS: RBA ‘change at the top’ may lead to more target flexibility & focus on stability The RBA is undergoing material ‘change at the top’. As expected, the decade-long reign of Glenn Stevens ended in retirement, & long-serving deputy Philip Lowe was appointed Governor. With a change of Governor (or Treasurer), the RBA &

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Wake up. The TPP is not about free trade

By Leith van Onselen Andrew Hudson of the Export Council of Australia yesterday told the Joint Standing Committee on Treaties (JSCOT) that Australia must ratify the Trans-Pacific Partnership (TPP) trade agreement, as failure to do so would bolster the protectionist movement, which he argued is gaining support in many parts of the world. From The