Global Macro:
- Why everyone loves housing. VOX
North America:
- Raise rates for growth. Bloomberg
- Q3 GDP upward revisions. Calculated Risk
- Fighting over phones. Zero Hedge Americans!
- Tough road ahead for fiscal cliff. Reuters
- Don’t take inflation hawks seriously. Tim Duy
Europe:
Asia:
- Chinese liberalism heads in two directions. Econospeak
Local:
- Cap’t Glenn considers retirement. AFR
- AV Jennings sees turn in construction. SMH
- RSPT clawback will trigger miner exodus. The Oz So predictable…
- Tinkler exodus. The Oz
- Kissing some bank booty. AFR Bullseye!
- Dollar high forever. AFR
A shallow Vox report, but summed up nicely by “.. better financial education may reduce this bias towards overinvesting in housing.”
AV Jennings reveals the next housing demand lever to be pulled
“Speaking at the company’s annual meeting, Mr Summers said one cause for cautious optimism was the belief that housing in Australia was still understocked and immigration was continuing to grow”
Stephen Nicholls, Property Editor reports in the Sydney Morning Herald that he evidence that now is the time to buy… just because an agent bought an apartment with a failed auction:
http://smh.domain.com.au/real-estate-news/agent-snaps-up-bargains-after-units-passed-in-20121123-29ysj.html
IF YOU ever needed evidence that now was a time to buy, look no further than the sale of two waterfront apartments in Elizabeth Bay on Thursday.
The RESID index has red-lined
+1 the phone vision from the auction is hilarious. The audience of halfadozen old money sydney dowagers (probably EB neighbours) looking at each other while all the properties get passed in. The room filled with the heady aroma of mothballs and retirement funds vaporising
+1 Comedy gold!
Perhaps he sees a difficult time ahead, and he’s trying to get out before it arrives?
I suspect that might have been Howard’s reason for a weak fight for the reigns in 2007.
test reply to your test reply.
Firefox 17.0
Yeah, I read MB from about five different devices and at least one of them will need a re-login once a day.
In that case, Glenny better make up his mind fast and resign before next friday..
On Friday, Mr Stevens is due to face the federal joint parliamentary committee on the Australian Commission for Law Enforcement Integrity over the Securency and Note Printing Australia scandal.
The transcripts and the report will be an interesting read.. the banking committee report had less than flattering comments from Lib & Greens MP (committee members) about the Gov’s conduct.
There is a job going on Mud Island that Glenn may be interested in
http://www.bloomberg.com/news/2012-11-23/boe-cloak-and-dagger-governor-job-process-keeps-bowles-waiting.html
Good piece here:
End of mining’s golden age to leave cracks in pipeline
Stevens getting out and Tinkler’s demise are two more canaries about the difficulties ahead. It ain’t going to be pretty folks!
“economist Paul Krugman put it: “Iceland broke all the rules, and things are not too bad….Iceland’s economy is set to grow by 2.7% this year while the eurozone is expected to shrink by 0.3%…” But it’s nasty underneath ! “..collective equity of homeowners aged 31-45 has fallen from +100bn ISK down to -8bn…”
Krugman is a Keynesian clown who knows as much about sound monetary policy as I do. If anyone wants to see him throw his teddy bear out of the pram after being “educated” by Pedro Schwartz please.. then click below for the show!!
http://www.youtube.com/watch?v=N8LmE5cfQKA
Thx for the link. There are none so blind, as Krugman appears to be, as those that will not see…..
Krugman’s unsavoury demeanour is not because of his opinions on the *economics* in the debate.
Thank you. It was interesting. Does Krugman ever engage in level discussions with anyone with a different view to his own?
What was striking about this clip was how Prof Schwartz was respectful and paid repeated compliments to Krugman and his work -even recommended reading the book, only for Krugman to attack him for not being respectful enough and then delivering an authoritarian answer. A telling presentation of human behaviour.
Krugman couldnt hold his own against a B+ 4th grader.. the fact that this guy has a Nobel prize IMO devalues the whole thing to the point of worthlessness. The fact that Barrack (honest guvnor I’ll close Guantanamo) Obama also has one in his cabinet for peace.. case closed I think
SMc – I take it you are no fan of Krugman – neither is this bloke (from an Austrian perspective):
http://krugman-in-wonderland.blogspot.com.au/
But it’s nasty underneath ! “..collective equity of homeowners aged 31-45 has fallen from +100bn ISK down to -8bn…”
I don’t understand this criticism. Do you expect Iceland to do The Bernanke and re-inflate homeowners equity with more debt pumped into the economy via QE? What exactly is your point?
Iceland did the right thing and is a model for the rest of the world on how to respond to a sovereign crisis triggered by a private banking crisis.
Isn’t that whole point of a debt writedown vs another can-kick ?
The Guardian piece on Iceland
http://www.guardian.co.uk/world/2012/nov/23/iceland-recovers-voice-financial-crisis
Who gets the last laugh and bragging rights now!
Don’t worry about Lorax. Ignore him, I usually do.
If Lorax had his way comments would be confined to guilt ridden sandal wearers; Green Left Weekly subscription holders; those with BAs in performing arts; PhDs whose doctoral theses’ investigated marxist economic constructs and their application to resource rich countries; and of course himself and trusty side-kick Mav.
He’s a natural disciplinarian with strong authoritarian impulses – his world order he believes should be everyones’ world order. Despite this I like the dude – and have ignored his demands that I go away – you do the same!
Lorax immortalised:
http://www.youtube.com/watch?v=dAq1P04yyJk
+1 .Great summation of the Left 31dk. Only thing to add would be their constant efforts to censor and control the flow of propaganda.
Thanks for the laff.
Propaganda?! 3d1k is a shill for the resources sector. He/she/it is paid comment here. Of course I’m going to do my utmost to counter that.
My days not complete until I get a dose of BotRot.
3d1k, It is nice to know I am always in your mind.
http://www.smh.com.au/opinion/political-news/left-accused-of-keeping-aborigines-in-poverty-20121123-29yrv.html#ixzz2D5YpJBat
How the Left keep people poor and dependent, stifling real development and opportunity. With taxpayer money.
“She accuses Labor of taking Aboriginal voters for granted since the days of the Whitlam government but says this changed with the election of the West Australian Liberal MP Ken Wyatt as the first indigenous member of the House of Representatives, and the defeat of the Labor government in this year’s Northern Territory election, largely due to the disaffection of indigenous voters in bush seats.”
and they prospered under the Howard Government. Seriously, all sides of politics have failed the Aboriginal people.
Canada and Australia have more in common than just Liz Windsor and a popular fiat currency
http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/is-canada-an-island-of-economic-stability-hardly-and-heres-why/article5551581/
So a couple of kids think they’ve found the answer to why people invest in housing, by stating the obvious. Thereby ignoring the thousands of papers that show that the favourable taxation treatment of owner occupation is the major factor.
They would not be finding a “low return to housing” if they had done their figures four years ago.
My favourite link of the weekend was this one. It is all about the consumer debt – way more so here than in the US as well. As they point out the same amount of money was lost in the housing bubble as the dotcom bubble – but the housing bubble was built mostly on debt which made the effects much worse.
http://www.businessinsider.com/economists-on-obamas-failure-to-address-mortgage-debt-2012-11
An interesting article and that link to the paper was also handy.
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1961211
But of course it does not really present a problem if you adopt the RBA’s two pronged strategy.
1. Use low interest rates to encourage fresh entrants at the bottom of the debt pyramid.
2. Use low interest rates to force savers to subsidise the life styles of those previously induced by the RBA to take on more debt than they should have.
There is the slight problem of closing in on ZIRP but the RBA would rather that than change direction and thereby expose its past performance/recommendations/assurances for what they were.
Obama wrestles with mortgage debt
http://www.washingtonpost.com/business/economy/economists-obama-administration-at-odds-over-role-of-mortgage-debt-in-slow-recovery/2012/11/22/dc83f25e-2e87-11e2-89d4-040c9330702a_story_2.html
Looks like most of his economists wanted a mortgage debt jubilee ala Steve Keen. I fail to see how a DJ would discourage a repeat of the errors of the recent past.
Undercover NSW Fair Trading officials attend auctions.. We can expect a spike in unreported auctions because the agents are too busy paying fines
http://smh.domain.com.au/real-estate-news/undercover-agents-catch-out-dodgy-estate-agents-20121124-2a02n.html
And Jessica Irvine exposes dodgy Merchants of Debt and their trailing commissions.. Go Jessica!!:
http://www.news.com.au/national/brokers-advice-costly-for-buyers/story-fndo4bst-1226523336091
+1 on Jess Irvine’s piece.
It’s taken a little while for Jess to warm-up but this is gutsy. It would be easier for her not to challenge big advertisers in a climate of falling newspaper revenues.
“We can expect a spike in unreported auctions because the agents are too busy paying fines
”
How very prophetic of you Mav, indeed we did. Louis Christopher tweeted last night that the unreported for Sydney was a whopping 227 auctions. He suggests the true clearance rate would be in the low 50′s.
How’re those green shoots coming along ?
Nothing will discourage the errors of the recent past. It’s not they haven’t happened before.
yep there is something screwy going on with comments at least in this thread.
Hey, Australia! here’s what happens when all you have left to keep your economy afloat is….property speculation! NZ had it’s mania under control 2 years ago; now ,with a cash rate at 2.5%, (not too far below yours, and where yours is off to?) and no ‘real economy’ left to rely on, debt is the only answer. Don’t let it happen to you! “… sold for $1.175m above valuation…”
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10849753
HnH, an interesting discussion ensues at FT where Izabella Kaminska reports on the widely supported views of George Magnus (UBS) (think Chovanec, Pettis, Societe General’s Albert Edwards). What makes this column stand apart from the usual bearish hoardings is a return to the work of James White, an Australian analyst, and his refreshing (particularly in the current bearish climate) alternate view presented in The Rise of the Ferro Dollar. I like White’s view and it seems FT considers it has merit too.
http://ftalphaville.ft.com/2012/11/22/1276193/magnus-on-chinas-investment-cliff/
http://ftalphaville.ft.com/2012/07/12/1080091/china-as-a-post-capital-economy/
The comments are also worth a look: White, Kaminska and Kate MacKenzie.
James White’s The Rise of the Ferro Dollar:
http://www.cfsgam.com.au/uploadedFiles/CFSGAM/PdfResearch/111202_The_rise_of_the_ferro-dollar.pdf
OMG! Post-capital economy, eh? hahahahhaha..
The excuses these sycophantic bank economists come up with to rationalise the Chinese kleptocracy.
The prolific Mr Joye at his hawkish best
http://afr.com/p/personal_finance/smart_money/housing_gain_retiree_pain_in_cheap_mC7S1cwhktsIXyarnPXnBO
Just made my third login, same machine, same browser (FF 17.0).
There are so many bugs on this site that it’s jeopardising its future, IMO:
blockquote bug, comment threading bug, login bug.
Bugs and bots dot com?
Professor Gavin Mooney via SMH
http://www.smh.com.au/opinion/politics/bring-on-warm-and-fuzzy-taxes-20121124-29zyt.html