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Macro Afternoon

by Chris Becker Another bullish day in Asia with stocks up across the board, even in “slow as she goes mate” Australia where the GDP print came in below expectations – well for the crowd at least. Whocoodanode? Currencies are feeling the embiggened strength of the USD, with the Aussie falling alongside Pound Sterling and

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CBA finds itself innocent of all crimes

Bloody Do-nothing Malcolm and his self-regulation banking balderdash: Commonwealth Bank of Australia’s under-pressure life insurance arm CommInsure said it has not yet found any evidence of wilful misconduct or wrongfully knocked back claims in any of its internal or independent reviews. In a submission to a parliamentary inquiry into the $44 billion life insurance sector,

10

GDP in detail: National income rises as growth falls

By Leith van Onselen The Australian Bureau of Statistics (ABS) today released the national accounts for the September quarter, which registered a 0.5% fall in real GDP over the quarter and only a 1.8% rise over the year, missing economists’ expectations of a 0.2% decline. On a per capita basis, real GDP fell by 0.8%

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Do-nothing Coalition to do nothing on growth

It’s all the way with nothing, from Downgrade Morrison following the GDP shocker: Treasurer Scott Morrison said the fall was “not just a reminder, not just a wake-up call or a warning about being complacent when it comes to economic growth and the need to boost incentives to investment, such as through corporate tax cuts.

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Australian GDP collapses

The ABS has released September quarter national accounts and they are hilariously bad: SEPTEMBER KEY FIGURE Jun Qtr 2016 to Sep Qtr 2016 Sep Qtr 2015 to Sep Qtr 2016 % change % change GDP (Chain volume measure) Trend 0.2 2.2 Seasonally adjusted -0.5 1.8 Final consumption expenditure (Chain volume measure) Trend 0.6 3.0 Seasonally

17

Aggressive sales culture rewards bad banking behaviour

By Leith van Onselen While Do-Nothing Malcolm has refused to address banking malfeasance, evidence of wrong-doing continues to pile up. The latest example comes via ABC’s 7.30 Report, which aired the above segment last night on the aggressive sales culture within banks that rewards bad behaviour. Below is the transcript: LEIGH SALES, PRESENTER: Australia’s banking

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Education minister flags teacher immigration quick fix

By Leith van Onselen What is it with Australian government? It seems that every time there is some perceived homegrown failure, their first policy solution is to reach for the quick fix. The latest comes from Education Minister, Simon Birmingham, who has flagged importing a bunch of “specialist” foreign teachers to stem the decline in

12

Americans demand to see Do-nothing’s secret refugee deal

From the Daily Caller: Senate and House Judiciary chairmen called on the White House Tuesday to declassify the details of a secret agreement to accept some 2,000 refugees currently held in off-shore detention camps by Australia. The vast majority of the refugees housed in these camps are from the Middle East and have so far been rejected

5

Construction PMI fades

From the AIG:  The national construction industry continued to decline in November with the Australian Industry Group/Housing Industry Association Australian Performance of Construction Index (Australian PCI®) registering 46.6 points in the month (50 points is the threshold that separates expansion from contraction in the Australian PCI®). This was an increase of 0.7 points from

0

Macquarie: Iron ore and coking coal topping

From Macquarie:  After a weak mid-October to mid-November, iron ore shipments from Australia and Brazil have picked up over the past couple of weeks, according to preliminary port data. The run rate of shipments is currently close to YTD highs seen in late-August, with Australian exports 8% higher than the YTD average and Brazilian

0

Macro Morning

By Chris Becker US stocks almost reached their previous high overnight, with European stocks breaking out on speculation of an easier bent by the ECB tomorrow night. The USD firmed, particularly against Pound Sterling which fell sharply as deliberations began on the future legality of Brexit. Oil fell slightly as OPEC production in November was

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“Mayhem” predicted as big house price “shakeout” looms

Cross-posted from New Daily: The Australian property market, overheated by ultra-low interest rates, faces a day of reckoning, senior economists have warned. The Reserve Bank on Tuesday held the official cash rate at the historic low of 1.5 per cent, as expected. This marked the fourth consecutive month Australia’s central bank made no change to

5

What would a US-China trade war look like?

Some good material from the sell side today helps us flesh out the scenario. From SocGen via FTAlphaville: In fact, nearly 37 percent of China’s exports to the US in 2015 consisted of value-added imported from other countries (Figure 3). Redistributing the imported value-added to their original source countries gives a very different deficit decomposition

17

Parallel PM Abbott rules out carbon price

From The Australian: The Coalition has vowed not to ­introduce an emissions intensity scheme for the electricity sector, as Malcolm Turnbull seeks to quell a backbench revolt over climate change policy and target Labor over its plans for a new price on carbon. In a reminder of the policy fight that cost Mr Turnbull his

8

Do-nothing Malcom’s banking fix turns to nothing

Via Domainfax: A Coalition backbench plan for a new banking tribunal appears to have been dropped by the Turnbull government, after an expert review found it was not needed. In October, Prime Minister Malcolm Turnbull said the government was preparing to set up a low-cost tribunal for victims of poor practices by Australia’s biggest banks, amid pressure

14

Jessica Irvine guzzles ScoMo kool aid

By Leith van Onselen Flufferfax is well and truly back. After Peter Martin’s gushing praise last week of Malcolm Turnbull’s hare-brained alternative to negative gearing reform, Jessica Irvine has penned a similarly glowing appraisal of Scott Morrison’s latest bid to improve affordable rental and community housing. From The Canberra Times: …step forward and take a

8

Mining sedition eats itself in TV debacle

From the ABC: The Chamber of Minerals and Energy (CME) has pulled an anti-mining tax television advertisement after one of the participants complained he had been misrepresented. The advertisement was designed to discredit a proposal by the WA Nationals to charge Rio Tinto and BHP Billiton a $5 rental fee for every tonne of iron

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Links 7 December 2016

Global Macro / Markets / Investing: Trump Seen as Biggest Global Economy Risk, Oxford Economics Says – Bloomberg The Future is Uncertain, but So Is the Past – Quantitative Ease Better capitalized banks lend more and lend better – Money & Banking If AI Takes Your Job, Will It Find You a New One? – cebglobal Carney Lays Out