The Turnbull bubble bursts

For once today I was beaten to the punch in writing a sensible critique, from Tony Walker at Domainfax: If a textbook case of how not to sell a big picture tax reform to the Australian people was needed, this has been it. Prime Minister Malcolm Turnbull may still have time to rescue a tax reform

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Morrison: Once and for all time a property parasite?

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


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.


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


National house rents begin to fall

RP Data has released its latest rental market report, which has registered zero rental growth across all dwellings in the year to January, with house rents actually declining by 0.3% across the combined capitals, with a nasty downward trend: Dwelling rental rates across the combined capital cities are recorded at $443 per week and they


ANZ job ads plod along

ANZ job ads for January are out and continue to plod along up 1% after falling 0.1% in December: Still little or no correlation with the ABS numberwang boom and still weak. Domainfax says: ANZ chief economist Warren Hogan said there’d been a broad upswing in hiring intentions since early 2014. But he added that


REIWA calls Pilbara bottom

By Leith van Onselen With Karratha and Port Hedland home prices and rents down by half (or more), the Real Estate Institute of Western Australia (REIWA) believes that Pilbara property might have found a bottom. From The ABC: WA Real Estate Institute (REIWA) president Hayden Groves said the situation in the Pilbara may have bottomed


Another warning for off-the-plan apartment buyers

By Leith van Onselen Last week, both Macquarie and CLSA warned that that the residential apartment boom could end abruptly as the approved apartments fail to get converted into commencements and completions. On Friday, ABC’s The Business ran the above segment warning that thousands of off-the-plan apartments are coming online, which are “flooding an oversupplied


CLSA: Brace for bad earnings!

From CLSA: EPS downgrades means multiples need to expand again If recent revisions set the tone we’d expect a disastrous reporting season. Analyst EPS downgrades have outnumbered upgrades two to one over the last month. Australia is not the only country with poor earnings sentiment, with earnings revisions turning significantly negative in Asia, Europe, and


QLD coal screams for assistance

By Leith van Onselen Queensland Resources Council (QRC) – the peak industry association representing the commercial developers of Queensland’s minerals and energy resources – has released a new report that has found that the coal sector is in dire straits, and has called upon the government for assistance. From The ABC: The Queensland Resources Council


Turnbull’s tax reform vision takes shape

By Leith van Onselen Last Thursday, I argued that Prime Minister Malcolm Turnbull should abandon lifting the GST and instead focus his political capital on superannuation reform. Well, it appears that the Prime Minister shares these views, telling ABC Insiders yesterday that he was not convinced that raising the GST would deliver sufficient economic benefits:


Warwick McKibbin gets his wish

By Leith van Onselen Let’s recall once more Professor Warwick McKibbin’s sermon last week, whereby he urged Australia to sell everything to China in a bid to maintain its living standards: “If you have got something like a fixed asset in a country and you are globalising the entire world then location becomes a valuable


Call an early election, Malcolm

I don’t know what kind of advice Prime Minister Turnbull is getting on the economy but judging by what’s being said in august corners and corridors it’s probably not very good. The RBA’s Statement on Monetary Policy on Friday suggested that it genuinely believes that it has conquered the mining boom and bust cycle. Treasury is


The ten firms that control Australia

Via Domainfax: In a firebrand speech in Canberra this week, delivered with the enthusiasm of someone with their eye on the party leadership, Mr Dastyari told a Politics in the Pub audience that he thought he understood power before coming to Canberra as a senator. “You will not find somebody who came more from the


Sydney auction clearances rebound

Core Logic-RP Data released its auction market report yesterday, which posted a big rebound in the preliminary national clearance rate driven by Sydney. The preliminary national auction clearance rate was 71.0%, up from the 61.8% preliminary rate recorded last weekend, according to Core Logic-RP Data: Sydney’s preliminary clearance rate rose 25.0% to 70.2%, whereas Melbourne’s was