Latest posts

1

China’s centrally planned stock bubble fail

Cross-posted from Investing in Chinese Stocks. December 2014: The shadowy trading behind China’s stock market boom This mania for margin trading—which allows individual investors to borrow from the broker to up the amount of their stock bets, magnifying the size of gains and losses—is a new thing. Back in 2007, Chinese stock regulators forbid leverage.

17

ASX at the close

Chris Weston, Chief Market Strategist at IG Markets I am going to be the first to put my hand up and say I expected a much more aggressive reaction to a ‘no’ vote. It has to be said that despite markets adopting a definitive risk-aversion feel, the mood has felt quite calm and there is

106

Yanis driven out

Fresh from the blog of Yanis Varoufakis: The referendum of 5th July will stay in history as a unique moment when a small European nation rose up against debt-bondage. Like all struggles for democratic rights, so too this historic rejection of the Eurogroup’s 25th June ultimatum comes with a large price tag attached. It is, therefore,

19

Shanghai crash resumes

Sorry, last one for the day. After launching nearly 8% this morning, Shanghai has now completely rolled over and is in the red: Chinext has been flogged 6%: On previous days this set up has tended to end with SSE capitalution…(by the way, I promise to kick this bust-watching habit).

17

Chinext goes splat

It’s not exactly high level blogging but China bust watching is fun! Shanghai is barely positive for the day now: As Chinext goes splat, down -4% and below Friday’s lows: How do you say ‘lost credibility’ in Mandarin for Chinese authorities?

115

Greece mulls printing counterfiet euros

From Ambrose Evans-Pritchard: Top Syriza officials say they are considering drastic steps to boost liquidity and shore up the banking system, should the ECB refuse to give the country enough breathing room for a fresh talks. “If necessary, we will issue parallel liquidity and California-style IOU’s, in an electronic form. We should have done it

6

Shadow RBA says…

Whatever! In Greece the economic tragedy appears to be in its final act, while dramatic falls in the Chinese stock market highlight the weaknesses of its economy. Domestic economic data is mixed: unemployment has fallen slightly but consumer and producer confidence have weakened. Inflation remains comfortably within the RBA’s target band. The CAMA RBA Shadow

3

Shanghai struggles despite bailout (updated)

Shanghai opened a nice 5% higher this morning following the weekend’s kitchen sink bailout but had faded now to 2.5%: Worryingly, the high beta Chinext market has rolled and is now down 2%: I’ll be honest, I have no idea where this bubble will go next. If you put a gun to my head I’d say

13

Alan Oxley’s TPP defence fails again

By Leith van Onselen Vocal Free Trade Agreement (FTA) advocate, Alan Oxley, has delivered another Panglossian view of the Trans-Pacific Partnership (TPP), which he claims will “will open services markets and free up investment”. From The AFR: Free trade and the Trans Pacific Partnership trade agreement has been roundly attacked, but mostly by groups that

77

Selling the farm

By Leith van Onselen Chanel 7’s Sunday Night program aired an interesting investigative report on the widespread sale of Australian agricultural land to foreign interests, particularly the Chinese (Parts 1&2 are above). According to the report, there is no comprehensive national list of foreign investment in rural land. However, in Queensland, which does maintain a

9

How endless population growth makes us poorer

By Leith van Onselen Fairfax’s Ross Gittins has posted a cracking article today lambasting Australian economists’ blind faith in endless population growth and a “Big Australia”, arguing that it is a recipe for lower living standards: Slower population growth meant slower growth in real gross domestic product and this would also make it harder to

163

Greece says “no” in landslide

With 60% of the Greek referendum vote counted it appears to be over: Who could have known that a sovereign people would tell a foreign power with whom they were previously at war to shove their blackmail demands? Here is Deutsche with where we go from here: NO, Scenario #N1. Soft deal This, in our

24

Shocks line up to sink Australia

A triple-headed risk is suddenly bearing down on the global economy as Grexit, the Chinese structural adjustment and US tightening combine to threaten a perfect storm. Each represents a different kind of shock but all three share one characteristic; they are attempts by large economies to exit extraordinary GFC stimulus: Europe is ending the farce that internal deflation can repair peripheral

14

But Greece doesn’t matter…

You can always tell that the Australian economy is really at risk when Ross Gittins resumes the campaign for national ignorance: We’re still learning to cope with a globalised world. Things work a bit differently now, and we have to adjust our thinking accordingly. Globalisation – the breaking down of barriers between countries – is leading to