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Brisbane joins ghost city rush

By Leith van Onselen Earlier this month, The AFR reported that investor demand will soon start to moderate and both rental and capital growth will slow because of concerns over a major oversupply of apartments: …there is some growing concern about the 19,800 apartments either under construction or being marketed within the inner-city precincts of


APRA waves wet lettuce at securitisation

I almost wrote to expect this this morning but hope got the better of me, from APRA: The Australian Prudential Regulation Authority (APRA) has released for consultation a discussion paper on its proposals to revise the prudential framework for securitisation for authorised deposit-taking institutions (ADIs). APRA is also releasing a draft Prudential Standard APS 120


Fitch praises macroprudential success

From Fitch: Early Signs of Success for Regulatory Intervention in Australian Mortgages Fitch Ratings believes Australian banks have tightened mortgage underwriting in 2015, largely due to regulatory intervention. However, risks have built within the mortgage portfolios over the past 24 months, leaving the portfolios more susceptible to a significant increase in unemployment or a sharp rise


Australian dollar iron ore collapsing

During the recent spate of upgrades for Fortescue, one often quoted strength (by Charlie Aitkin in particular) was that the iron ore price had bottomed in Australian dollar terms. Such was always ridiculous and now it’s fact: Australian dollar iron ore is today trading at $59.79, a new low that has violated the 2015 support zone


NZ specufestors flee tighter mortgage rules

By Leith van Onselen On 1 October 2015, new tax rules and residential requirements came into force in New Zealand affecting buyers and sellers of residential property. Specifically, these new rules: require non-residents and New Zealanders buying and selling any property other than their main home to provide a New Zealand IRD [tax file] number;


Australia’s fiscal straight jacket tightens to strangulation point

As the Budget falls apart on pressure from cuts to ludicrous forecasts and the iron ore hammering, Prime Minister Turnbull is softening us up for little to no action, from The Australian: An analysis by The Australian shows that Treasury’s decision to jettison its highly optimistic growth projections will leave the budget deep in deficit


The private colleges rort bleeding the Budget

By Leith van Onselen Last month, The Australian released three articles (here, here and here) uncovering widespread rorting by private colleges. The Australian revealed that private colleges were handed more than $1.4 billion in government-funded VET Fee -Help loans last year, which was four times as much as was provided to public vocational education and


The Parkinson ascendency

The yet-to-be-announced appointment of former treasury secretary Martin Parkinson to head the Prime Minister’s Department is a tale of justice restored, with a touch of Gilbert and Sullivan. Parkinson fell victim as soon as Tony Abbott became prime minister because he had once headed the climate change department; Abbott’s chief of staff Peta Credlin was


Make no mistake, housing affordability sucks

By Leith van Onselen Economic consultancy, LF Economics, has produced an interesting new report entitled “Parental Guidance Not Recommended”, which analyses long-term trends in housing and unit prices, interest rates, household incomes and mortgage costs to determine affordability in the Australian residential property market, via the LF Economics Affordability Index. The report finds that new


Pain intensifies for Perth’s landlord army

By Leith van Onselen Earlier this year, the Australian Taxation Office (ATO) released its statistics for the 2013 financial year, which revealed that Western Australians are some of the heaviest users of negatively geared property investment (see below charts). Suffice to say, many of these investors must be growing nervous, with the REIWA releasing its


Securitisation takes heat

From Banking Day: After years of delays, Australian Prudential Regulation Authority is expected to release as early as Thursday its plans for reforms to the regulation of securitisation, according to a report in the AFR Street Talk column. Small lenders in particular, including credit unions and non-bank lenders, are sweating on how long APRA will


Realty website price war tells you just one thing

From The Australian: REA Group has extended a price freeze across its premium advertising packages for residential properties, heaping further pressure on rival Domain to curb its price increases. The operator of real­, Australia’s No 1 property website, has committed to holding the line on prices until at least May next year at a time


MSM plasters lippy on iron ore mining pig

The Australian press is falling over itself to defend doomed miners. From Bartho: A price below $US40 a tonne isn’t inconceivable – it would represent a return to the long-term trends that long-established producers like Rio and BHP used to predicate their investment on. At those levels, only Rio and BHP would generate meaningful profits


Daily LNG price update (more contract pain)

The Brent oil price fell back to $45.78 last night as Syrian tensions eased and the US stock build continued. Also, OPEC is not sounding like it has any intention of cutting production, from Reuters: OPEC is determined to keep pumping oil vigorously despite the resulting financial strain even on the policy’s chief architect, Saudi


AEP be damned: China getting worse

Cross-posted from Investing in Chinese stocks: Hope for stabilization in China’s economic slowdown has been smashed by deteriorating data and economic forecasters at Industrial Bank of China have dubbed December the line in the sand. The article goes through the data points below and mainly sees the existent trends continuing. Analysts also see the data


Links 26 November 2015

Global Macro / Markets / Investing: Junk-Bond Losses Pile Up as Traders Flee Any Whiff of Bad News – Bloomberg Elite funds prepare for reflation and a bloodbath for bonds – The Telegraph Hedge Funds Stalk Battered Corner of Bond World – WSJ The Oxford Economist Running the Fed’s Interest-Rate Machine – WSJ For Poor


ASX at the close

Angus Nicholson for Chris Weston, Chief Market Strategist at IG Markets Asian markets followed Europe’s lead downwards as concerns over Turkey’s downing of a Russian jet seemed to add to ongoing market concerns. While the dispute between Turkey and Russia is unlikely to escalate into a “hot” conflict, it does underline the unresolved tensions over


China consumer confidence off the canvass

From Westpac: The Westpac MNI China Consumer Sentiment Indicator (hereafter the CSI) rose 3.3pts from 109.7 in October to 113.1 in November. The CSI is now up 1.9% on a year ago but still 6% below its long run average. The Index is in line with the average recorded over the last 18mths. This follows