Unconventional Economist

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Govt accused of “double dipping” into $680m ASIC fee chest

By Nathan Lynch, Head Regulatory Analyst for Australia & New Zealand, Thomson Reuters The federal government is considering “double charging” companies for A$260 million worth of annual regulatory fees under its proposed user-pays model for the Australian Securities and Investments Commission (ASIC), sources have revealed. The proposed cost recovery model is designed to replace the

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Chris Joye: Abbott wrong to drop deposits tax

By Leith van Onselen The AFR’s Chris Joye has slammed the Abbott Government’s decision to drop the bank deposits tax, claiming that it is at odds with moves internationally and embeds moral hazard into Australia’s banking system: So let me get this straight. After the four peak government agencies that oversee Australia’s financial system recommended

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Australian immigration nears GFC low

By Leith van Onselen The Australian Bureau of Statistics (ABS) has released visitor arrivals and departures data for the month of July, which registered further falls in net long-term and permanent migration into Australia. In the year to July 2015, there were 684,060 permanent and long-term arrivals into Australia – down from the record 792,500

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Netflix drives drop in Australian piracy

By Leith van Onselen The entry of online streaming services like Netflix, Stan and Presto has driven a 25% drop in internet piracy, according to new research from consumer advocacy group CHOICE. From The Australian: “This proves once again that making content affordable and easily available is the first and most effective tactic to reduce

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Murdoch still backing Abbott

By Leith van Onselen In the lead-up to the September 2013 Federal Election, Rupert Murdoch’s tabloids ran a feverish campaign backing Tony Abbott as Prime Minister: With all of the stuff-ups and gaffes that have occurred since becoming Prime Minister, one would have though that Mr Murdoch might be having second thoughts. Not so, with

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Growth below 3% the “new trend”

By Leith van Onselen Professor Ross Garnaut, one of the ‘godfathers’ of Australian economics and author of Dog Days, has warned that economic growth below 3% is the “new trend” and expressed alarm that Australia’s banks remain hooked on wholesale debt markets. From The AFR: The author of Dog Days foreshadowed two years ago much

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Govt urged to clean up real estate dirty money

By Leith van Onselen ABC’s The Business last night ran a segment (written report here) on the increasing international pressure on Australia to clamp down on foreign criminals laundering dirty money through Australian homes. Back in April, the Paris-based Financial Action Task Force (FATF) on money laundering released its scathing report on Australia, which found

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FIRE sector pushes risk past GFC levels

By Leith van Onselen Wednesday’s national accounts release for the June quarter confirmed that Australia’s FIRE economy – Finance, Insurance and Rental, Hiring & Real Estate Services – continues to scorch the economy, increasing its share of the Australian economy to a record 11.7% (see next chart). Since financial markets were first deregulated in the mid-1980s,

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Household income holding up better than nation’s

By Leith van Onselen The Reserve Bank of Australia (RBA) yesterday released real household disposable income (HDI) data, derived from the June quarter national accounts (released Wednesday), which revealed that real per capita HDI rose by 0.1% over the quarter and was up by 0.7% over the past year (see next chart). As shown above,

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RP Data weekly Australian house price update

By Leith van Onselen In the week ended 3 September 2015, the Core Logic-RP Data 5-city daily dwelling price index, which covers the five major capital city markets, was basically flat (-0.01%), which followed last week’s 0.40% decline (see next chart). Home values rose in Sydney and Brisbane, but fell in Melbourne, Adelaide and Perth

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Professor badly mis-diagnoses Chinese buyers

By Leith van Onselen Hans Hendrischke, Professor of Chinese Business and Management at the University of Sydney, has produced some laughable “research” today in a bid to prove that Chinese nationals account for just 2% of Australian property sales, therefore, they are not helping to push up home prices. From Domain (my emphasis): Hans Hendrischke compared

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Trade deficit improves in July

By Leith van Onselen The Australian Bureau of Statistics (ABS) today releasing trade data for the month of July, with Australia’s trade deficit improving to $2,460 million from $3,050 million in June (revised up from $2,933 million). The result easily beat analyst’s expectations, who had expected the trade deficit to widen to $3.16 billion. It

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Adani hits another road block

By Leith van Onselen Following the CBA last month pulling out of its role as financial adviser, Adani’s controversial $16 billion Carmichael thermal coal mine has been dealt another blow, with one of its two big external customers – Korean giant LG – confirming that it will not purchase coal from the project. From Fairfax’s Michael

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Is ALP throwing Canning to keep Abbott?

By Leith van Onselen A new opinion poll for the upcoming Canning by-election, conducted by Essential Research, has the Coalition leading Labor 51% to 49% on a two-party preferred basis, suggesting the Coalition will be returned, but with a big swing against it (the Liberals currently hold the seat with a 12% margin). According to

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Which Aussie iron ore mine has the best dirt?

From Citi Research comes an interesting report looking at the average premium/discount to the Asian reference price received by the various major iron ore producers: According to Citi: “Rio Tinto has been the best placed in mirroring the benchmark price and arguably FMG’s iron ore has lagged due to quality discounts. FMG suffered highest discount

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Canada scuttles Australia’s TPP bid

By Leith van Onselen When final negotiations for the Trans-Pacific Partnership (TPP) trade agreement failed in Hawaii in late-July, proponents of the deal were hopeful that negotiators could come together and strike-up a deal by the end of August, prior to Canada going to the polls and before the US political system gears-up for next

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Australia’s shoddily built high rise shoe boxes

By Leith van Onselen In late May, ABC’s 7.30 Report ran a segment on the cheap combustible cladding that has covered potentially thousands of buildings across Australia, that last November sent a Docklands building into a towering inferno: LEIGH SALES, PRESENTER: When a cigarette was left on a balcony table in Melbourne’s Docklands precinct last

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Charting the fall in Aussie living standards

By Leith van Onselen To add some perspective on why MB believes the Australian economy is so fragile, and why living standards are falling, I have once again taken the time to deflate three measures of the domestic economy, as provided in the June quarter national accounts (released yesterday), by the ABS’ population data, in order

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The mining states’ boom and bust

By Leith van Onselen For years, the resources boom was the gift that keept on giving, driving the Australian economy forward through the post-Global Financial Crisis period, helped in no small measure by the huge surge in mining-related capital expenditures (capex). Now, mining capex is in free fall (see next chart), causing clear headwinds for

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GDP at 0.2%: Did the Aussie economy just snap?

By Alpha Beta Strategy and Economics, republished with permission Aussie growth slows … again ABS data released today showed Australian economic growth slowing to just 0.2% over the quarter. This is the slowest rate of quarterly growth since the global financial crisis, with the exception of the quarter affected by the Queensland floods. More importantly,

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Public debt surges under Abbott Government

By Leith van Onselen From Stephen Koukoulas (“the Kouk”) comes news that public debt has exploded by $111 billion since the Abbott Government was first elected in September 2013: As at last Friday, 28 August 2015, gross government debt was $384.7 billion – the highest level ever recorded. This represents an increase of $111 billion