NAB business survey flames out

From NAB comes the February Business Survey: The NAB Business Survey softened slightly in January, although the deterioration was to a large extent driven by a sharp decline in mining and wholesale – conditions were generally mixed elsewhere – and was largely concentrated in Western and South Australia where the flow on effects from the mining slowdown

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Here come the property parasites

By Leith van Onselen Right on cue, the property lobby has re-emerged to caution against any changes to negative gearing, arguing that it would not boost the Budget. From The Australian: Cutting back negative gearing would add nothing to the government’s bottom line… Aussie Home Loans founder John Symond warned of the ripple effect of


Is there gold in them thar markets?

From UBS: Australian gold equities are divided, premium for some, discount for others We see Australian gold equities factoring in a gold price of US$1,147/oz, in line with spot. However, we see the sector split, with domestic & operationally diverse producers implying relatively higher gold prices and subsequently trading at a premium to NPV. This


Consumer confidence hangs on

By Leith van Onselen After four consecutive weekly falls, the ANZ-Roy Morgan consumer confidence index has registered its first increase for 2016, rising 0.2 points to 111.4, but is still tracking below the long-run average of 112.7 (see next chart). The improvement was driven by a big lift in the time to buy a major


Superannuation reform takes shape

By Leith van Onselen The superannuation reform package is starting to take shape, with both concessions on contributions and earnings seemingly on the Government’s radar. As reported by Fairfax’s Peter Martin and Mark Kenny today: Generous superannuation concessions seem certain to get a haircut, possibly by replacing the current 15 per cent rate on contributions


Government mulls Medicare payment privatisation

By Leith van Onselen From The West Australian comes rumours that the Federal Government is considering a massive privatisation of the Medicare, pharmaceutical and aged-care benefits payment system in a bid to save potentially billions in operating expenses: …the $50 billion-plus outsourcing would be the first time the private sector has delivered a national service


Gotti discovers the Mining GFC

From Gotti (chart from ZH): …one way or another, the current energy, emerging country and hedge fund/investment banking losses will end up with the global banking community. The market believes Citigroup (shares down one third in three months), Bank of America (31 per cent) and Deutsche (down more than 50 per cent in six months) will


Morrison: Once and for all time a property parasite? (updated)

By Leith van Onselen Last week, the Property Council of Australia (PCA) took rent-seeking to another level, threatening MPs with electoral carnage if they dare tinker with Australia’s negative gearing laws. The PCA also repeated the oft-told myths that negative gearing “keeps a lid on rental costs and house prices” and is utilised primarily by


Naked Emperor Barnett eyes crown jewels

Fresh from another credit rating downgrade, wholesale budget lies and parading in front of his public works white elephants, Naked Emperor Barnett’s greasy fingers are itching to flog the crown jewels, from The Australian: West Australian Premier Colin Barnett has conceded for the first time he may need to consider the potential $15 billion privatisation of the


Has China arrested the yuan’s fall?

Cross-posted from Investing in Chinese Stocks. BBC: China’s currency reserves plunged in January China has been running down its vast foreign currency reserves in an attempt to boost the value of its own currency and stem a flow of funds overseas. At $3.23 trillion, China still has the world’s biggest reserve of foreign currency holdings.


Links 9 February 2016

Global Macro / Markets / Investing: A Dying Breed: Currency Traders Are Left Out of New Wall Street – Bloomberg World’s Largest Energy Trader Sees a Decade of Low Oil Prices – Bloomberg If you could know one asset price twenty years out – Marginal Revolution Fund managers ready for ‘smart beta’ wars – FT


ASX at the close

Chris Weston, Chief Market Strategist at IG Markets There seems little doubt that we have reached a key juncture for the world’s financial markets and if confusion wasn’t at fever pitch two weeks ago then things are even worse now. We always stated that when the Federal Reserve raised rates it would only give more


Petrol prices continue to slide

From CommSec: According to the Australian Institute of Petroleum, the national average Australian price of unleaded petrol fell by 0.3 cents to 111.6 cents per litre in the week to February 7. It was the ninth fall in the national petrol price in 10 weeks. In Australian dollar terms the Singapore gasoline price fell by


Moodys downgrades WA for Budget lies

About time, from Moody’s: Moody’s Investors Service has today downgraded the long-term issuer and senior unsecured debt ratings of the Western Australian Treasury Corporation (WATC) — backed by the State of Western Australia — to Aa2 from Aa1 and changed the outlook to stable from negative. Moody’s also downgraded the Euro Medium Term Note Programme to (P)Aa2 from (P)Aa1. At


NZ income shock worsens

By Leith van Onselen When Statistics New Zealand released its Q3 national accounts in December, it revealed that real gross national disposable income (RGNDI), which measures the real purchasing power of New Zealand’s disposable income, rose by only 0.3% over the quarter and by 1.4% over the year due to the falling terms-of-trade (read dairy


The preposterous LNG debacle

From Domainfax comes a new chapter in the history economic stupidity: Large industrial customers in north-west Queensland paid on average $11.97 a gigajoule for gas in 2015, compared to $5.68 in Victoria, a new report for the Department of Industry, Innovation and Science has found. Industrial gas prices have been steadily rising in all states