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Weekend links 30 April – 1 May 2016

Afternoon with Gin Fizz, 1961, Elisabeth Cummings, Art Gallery of NSW   China: Canary in the Hong Kong housing market? Why one Mid-Levels mortgage default is a case study in financial engineering – SCMP China’s Stocks, Bonds, Yuan Are a Triple Losing Bet This Month– Bloomberg China’s Central Bank Raises Yuan Fixing by Most Since

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ASX at the close

Chris Weston, Chief Market Strategist at IG Markets Clearly traders had warmed to the Bloomberg article (22 April) centering on offering liquidity to Japanese banks and effectively paying them in the process. This speculation started from a belief that we were going to get aggressive broad based easing, hence the aggressive reaction. In fact, we

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Has the time come to consider criminalising tax avoidance

Cross-posted from Independent Australia: Has the time come to consider criminalising tax avoidance and making boards and senior officers liable for prison sentences, asks former ATO Assistant Commissioner, John Passant. IN A SPEECH in 2013, Barack Obama labelled inequality “the defining challenge of our time”. Oxfam has argued that 85 people own as much of the world’s

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Iron ore’s megamouth blasts RIO and BHP

Cliffs CEO Lourenco Goncalves is back via The Oz: “Jimmy Wilson was fired,’’ Mr Goncalves said. “Mr Wilson was the most vocal Australian on how to intentionally destroy international iron ore prices. He is on record with the statements about deliberate overproduction and his lack of concern on the impact that might cause on others,’’ Mr

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Malcolm’s negatively geared battlers

By Leith van Onselen During the Howard Government’s reign we had “Howard’s battlers” – ordinary middle-class nuclear families who reveled in middle-class welfare dished-out over the Government’s 12-years in office. In 2016, we have “Malcolm’s battlers” – those so-called ordinary middle-income property investors using negative gearing to “get ahead” in life, as explained by Treasurer

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BOJ pain trade drives big iron, gas higher

Big iron ore and gas are off to the races again today as Dalian keeps surging (up another four points during the day from overnight gains) and the USD keeps falling: The culprit is easy to find with yen breaking out: Which is enabling China to appreciate the yuan as well: For those that do

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Australia’s health system weighed down by bureaucrats

By Leith van Onselen The Australian’s Adam Creighton has penned an insightful piece today on the high number of bureaucrats involved in Australia’s health system, which is growing much faster than employment growth: Australia’s health bureaucracy is growing faster than national employment and now rivals the country’s 17,300-strong army and airforce reserves, with one administrator

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Could a AAA downgrade miss the banks?

From Deutsche:  The first question to ask is which credit rating are we talking about? In the first instance we think the pressure will be on the foreign currency rating, not the local currency rating, although we cannot rule out agencies simultaneously acting on both. It is quite common for countries to have a

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Victoria gambles its Budget on the property ponzi

By Leith van Onselen Victorian Treasurer, Tim Pallas, has responded to criticism over the state Budget’s surplus projections, claiming that the Budget is sustainable despite its heavy reliance on the booming property market.  From The ABC: “We’ve made modest assumptions about the revenue we get from land going forward,” he said. “We’re actually assuming that

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REIQ joins the negative gearing liars

By Leith van Onselen After conducting a statewide survey of its 14,000 members, the Real Estate Institute of Queensland (REIQ) has argued that changing negative gearing would have a “crippling effect” on Queensland’s property market by lowering dwelling values while magically raising rents. From The AFR: “We now know for a fact that 79 per cent

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Daily iron ore price update (it’s baaaack)

Iron ore charts for April 28, 2016: It’s baaack. Tianjin benchmark roared 4% to $62.90 as it chased another wild day in paper. Rebar rebounded! From Reuters, the orders to snuff this out came from on-high: China’s securities regulator ordered the country’s major commodity futures exchanges this week to control speculative trading activity, sources told Reuters,

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US GDP weak but fine

Overnight the US reported a lousy 0.5% annualised GDP for the first quarter, from the BEA (chart from ZH): Real gross domestic product — the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes — increased at

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Peak urbanisation as Chinese migration stalls

Cross-posted from Investing in Chinese Stocks. NBS has a report on China’s migrant population: 2015年农民工监测调查报告. Slowing migrant population growth Most migrant population growth is from locals: Age breakdown, with China’s aging demographics clearly visible: The a geographic breakdown. Non-local migrants are those heading to other cities in their province or to other provinces: Industry breakdown: