Kohler slams the super gravy train

ScreenHunter_2952 Jun. 24 12.41 By Leith van Onselen Business Spectator's Alan Kohler has written a stinging critique of Australia's superannuation system, slamming the high level of fees due in part to compulsory contributions and the lack of price regulation: A chart in the Financial System Inquiry’s interim report shows that since 2009 the average super fund has increased in size from $1.5 billion to $3.5bn, while the average fee has fallen from 1.3 to 1.2 per cent. That means the average fees received by each fund have doubled from $20 million a year to $40m. What better business can there be? Contributions are...
read more

Should Australia invest in mass public transit?

ScreenHunter_3402 Jul. 22 11.12 By Leith van Onselen Business Spectator's Rob Burgess has written a spirited post slamming the Abbott Government's roads fetish and advocating a massive lift in public transport investment: In the past decade there has been a shift back to public transport as sprawling Australian cities make commuting by car more expensive -- both in terms of fuel, time spent battling congestion, and skyrocketing parking costs... Infrastructure Australia... recommended recently: “Australia's transport systems are especially struggling ... with public transport growing rapidly in recent years and reaching...
read more

Consumer confidence recovers post-Budget losses

ScreenHunter_15 Mar. 18 16.24 By Leith van Onselen The ANZ-Roy Morgan Research (RMR) consumer confidence index has now more or less recovered from its Budget-induced slump, rising another 4.8 points in the week ended 20 July to 113.5, and is now basically in line with its long-run average reading of 113.7, and only some 2.2% lower than April’s pre-Budget high (see next chart). The below chart, which plots the most recent Westpac-Melbourne Institute’s Consumer Sentiment index against the ANZ-RM Consumer Confidence index, highlights the mood of the Australian consumer more clearly: Expect next month's Westpac...
read more

Modelling falling living standards

sock By Leith van Onselen The inaugural Melbourne Economic Forum was held yesterday, which brought together a wide range of economists to discuss the Australian macroeconomic outlook and policy choices following the end of the mining boom. The discussion was centered around new modelling by the Centre of Policy Studies at Victoria University, which found that real per capita incomes and consumption will continue to slide for the rest of the decade and beyond as the fallout from falling commodity prices and the terms-of-trade takes hold, with real income per Australian forecast to be around 2%...
read more

Kiwis flood home from Australia (members)

ScreenHunter_10 Mar. 29 12.46 By Leith van Onselen Yesterday, Statistics New Zealand released its permanent & long-term migration figures, which revealed that New Zealand net migration is booming and Kiwis are returning home from Australia: In the June 2014 year, permanent and long-term (PLT) migrant arrivals numbered 100,800 (up 14 percent from 2013), the first time more than 100,000 arrivals have been recorded in a year. Migrant departures numbered 62,400 (down 22 percent). This resulted in a net gain of 38,300 migrants, the highest annual gain since the October 2003 year (39,300)... In June 2014, New Zealand had...
read more

PC slams Abbott’s paid parental leave scheme (members)

ScreenHunter_3079 Jul. 02 09.04 By Leith van Onselen The Productivity Commission (PC) has today released its Draft Report into Childcare and Early Childhood Learning, which explicitly criticises the merits of Tony Abbott's Paid Parental Leave (PPL) scheme, and recommends that some of the $5.5 billion earmarked for PPL would be better spent on childcare: The Commission considers that it is unclear that the proposed changes to the Paid Parental Leave scheme — which is more generous than the existing scheme and that recommended in the Commission’s 2009 report on paid parental leave — would bring significant additional...
read more

Links 22 July 2014 (members)

ScreenHunter_01 Apr. 02 06.19 Global Macro / Markets / Investing: The Fed’s intervention in biotech and internet stocks - Financial Times Speculators cut bets on higher oil prices - Financial Times Regulators split on too-big-to-fail banks - Financial Times Hedge funds braced for some of their worst returns since 2008 - Financial Times Emerging market debt issuance hits record high - Financial Times The Boom Is Coming, and Sooner Than You Think - Bloomberg View North America: The Chicago Fed National Activity Index slowed in June - Calculated Risk How much are demographics affecting wage growth figures?...
read more

Coalition backs pork over productive infrastructure

ScreenHunter_06 Jun. 06 09.33 By Leith van Onselen I noted on Friday how the Senate had responsibly placed limits on the Abbott Government’s “asset recycling” program, pushing through changes to the bill that would: 1) require that infrastructure projects worth more than $100 million be assessed by Infrastructure Australia with a published cost-benefit analysis; and 2) require that all incentive payments by the Commonwealth to the states require a legislative instrument, effectively meaning the upper house can reject payments which it does not believe deliver taxpayer value. Unfortunately, the Coalition has rejected...
read more

The Coalition’s mounting Budget black hole

ScreenHunter_3379 Jul. 21 14.34 The Conversation has undertaken a detailed stocktake of the major budget savings measures that have been either opposed, at risk, or yet to be legislated. According to their analysis, the Budget is facing $38.6 billion of at-risk savings. _________________________________________________________________________ The Australian government is facing billions of dollars of lost savings and revenue as a result of the divided Senate, which last week moved to block several measures the government had been relying on to improve the budget bottom line. Several other measures are yet to be debated or...
read more

No Callam, high rise cities are not the solution

ScreenHunter_07 Feb. 10 11.46 By Leith van Onselen Callam Pickering at Business Spectator has swallowed the Grattan Institute's Kool Aid and wholeheartedly accepted the findings of their latest report (debunked here) that the CBDs are the centre of Australia's economic universe: Australia’s economic activity is highly concentrated within our cities but poor town planning and public transport services mean many Australians are unable to take advantage of the choices that offered by city-living. A shift towards higher-density, inner-city living could provide a boost to productivity and activity in the years ahead... Few...
read more

Give us multilateral trade agreements, G20 (members)

ScreenHunter_14 Oct. 09 09.37 By Leith van Onselen The AFR's Alan Mitchell has penned a sensible article arguing against the proliferation of so-called "free trade agreements" (FTAs): If all the Sydney G20 trade ministers’ summit produces is a resolution to negotiate more free trade agreements, it will be a failure... Trade reform has been largely reduced to the negotiation of so-called free trade agreements, which are politically achievable only because they produce so little in the way of additional free trade... In favour of widespread unilateral and multi-lateral reform: ...governments need to conduct systematic...
read more

SMSF leveraged property in the spot light

ScreenHunter_12 Sep. 23 12.54 By Leith van Onselen The draft report of the Murray Inquiry into Australia's financial system, released last week, took direct aim at self-managed super funds (SMSFs) and leverage, warning that they could pose risks to the financial system and retirement savings: The use of leverage in superannuation funds to finance asset purchases is embryonic but growing. The proportion of SMSFs with borrowings increased from 1.1 per cent in 2008 to 3.7 per cent in 2012. The average amount borrowed increased over this period from $122,000 to $357,000. Total borrowings in 2012 were over $6.2 billion. More...
read more

Australia’s vanishing income growth

ScreenHunter_04 Feb. 08 21.40 By Leith van Onselen The mainstream media is slowly coming to the realisation that the pending huge growth in resource exports will provide the domestic economy with few economic benefits, since most of the profits will flow offshore and few workers will actually be employed. Professor Ross Garnaut, writing in The AFR, has penned a well-argued piece today warning of "immiserising growth" - a situation whereby a nation's citizens can actually be made worse-off from an expansion in resource exports: The growth in mineral exports over the past year has caused a fall in prices large enough to...
read more

Are cities really the heart of Australia’s economy? (members)

ScreenHunter_3297 Jul. 15 06.45 By Leith van Onselen The Grattan Institute has published a new report entitled Mapping Australia’s economy: cities as engines of prosperity, which maps the Australian economy by the location of economic activity, defined as the dollar value of goods and services produced by workers within a particular area. The Grattan Institute argues that a "great reshaping of Australia's economic geography is underway", whereby "the nation has moved from prosperity coming from regional jobs in primary industry a century ago, to suburban jobs in manufacturing after World War Two, to city centre jobs in...
read more

Joye: Australian housing bubble is now

ScreenHunter_3365 Jul. 20 08.17 By Leith van Onselen The AFR's Chris Joye posted a great article over the weekend explaining why he believes that Australian housing is now a bubble since values are between 20% and 30% above fair value: Australian homes are 19 per cent overvalued... if you compare the house price-to-income ratio to its average since 1993. Other credible benchmarks on which to base future house price appreciation – including household income growth, the returns consumers think they will get and the rate at which rents rise – similarly imply that housing is overvalued by between 20 per cent and...
read more

RP Data weekend property market update (members)

ScreenHunter_18 Mar. 18 17.58 Click to view RP Data’s latest weekly housing market update, which provides a useful snapshot of the housing market as at 20 July 2014. This week’s report includes: Latest weekly dwelling value results; Auction results & clearance rates; Latest median house & unit prices; Average time on market & vendor discounts; Mortgage market activity; and New listings...
read more

Auction clearances record broad-based rise

ScreenHunter_19 Mar. 13 13.12 By Leith van Onselen The national auction clearance rate rose over the weekend, with Sydney, Melbourne and Brisbane all recording increases. According to RP Data, the national weighted average preliminary auction clearance rate was 70.7% over the weekend, which was up 2.0% from the 68.7% preliminary clearance rate reported last weekend. Sydney’s clearance rate rose by 0.5% to 76.9%, whereas Melbourne’s rose to 69.6% (last weekend 67.0%). Brisbane, which typically only has a small number of auctions, experienced a sharp rise in its clearance rate to 54.1% from 47.0% the weekend before....
read more

Links 21 July 2014 (members)

ScreenHunter_01 Apr. 02 06.19 Global Macro / Markets / Investing: Income Inequality Is Not Rising Globally. It’s Falling - New York Times Grantham: The Conditions Are Set For A ’Veritable Explosion’ In M&A That Send Stocks To ’True Bubble Levels’ - Business Insider Shiller: should we be worried about a bubble in asset prices? - The AFR Dumbest Chart Ever Ends Bull Market - Bloomberg View How Geopolitical Threats Affect the Stock Market - The Reformed Broker Rate increases will test the market mood - Financial Times Why investors should impose a “cooling off period” before undertaking big...
read more

The truth about “gold backed” cryptocurrencies

ScreenHunter_08 May. 28 13.39 Cross-posted from Bullion Baron Another day, another salesman tries to sell us the story that they are launching the first Gold backed cryptocurrency. On this occasion it's Anthem Vault (founded by Anthem Blanchard, son of well known Gold advocate Jim Blanchard): Newnote Financial Corp. is pleased to announce the successful development and launch of the first open-source gold-backed alternative crypto-currency, commissioned by Anthem Vault Inc. Business Wire So are they really the first? They certainly aren't the first to launch a "Gold backed" cryptocurrency. The first I recall reading about...
read more

Economy-wide sales slowest in 2 years

ScreenHunter_01 May. 06 08.03 By Leith van Onselen CommSec has today released its Bank Business Sales Indicator for June, which tracks spending broadly across the economy by measuring the value of credit and debit card transactions processed through Commonwealth Bank merchant facilities. According to CommSec, economy-wide spending growth has slowed to its weakest pace in two years, with spending in June 0.2% below the decade average in trend terms: Economy-wide spending slowed again in June and growth is now the weakest in almost two years. The Commonwealth Bank Business Sales Indicator (BSI) – a measure of...
read more

Aussie petrol taxes 4th lowest in OECD

ScreenHunter_3363 Jul. 18 09.37 By Leith van Onselen The Greens' and Labor's blocking of fuel excise re-indexation has been dealt another blow by The Conversation's Paul Burke and Vlado Vivoda, who have posted research showing that Australian petrol taxes are the fourth lowest in the 32 Member OECD: The International Energy Agency publishes quarterly reports on unleaded petrol prices and taxes. The latest report surveyed petrol prices in the first quarter of 2014 in 32 countries. As you can see above, the report found that only three countries – Mexico, the United States and Canada – have lower petrol taxes than...
read more

Libertarians are unable to see climate change

imgres By David Collyer, cross-posted from Prosper Prime Minister Tony Abbott and his government do not believe in climate change. They have erased all of the measures Rudd and Gillard introduced to shift Australia to a low-carbon future. If they merely doubted climate change, they would simply zero-price the behavior-changing settings and await more information. This is usually what cautious, evidence-based conservatives do. But no, their beliefs trump the science and they are acting boldly to turn those beliefs into law. Does ignoring science seem as bizarre to you as it does to me? When...
read more

Do we manage adversity well?

ScreenHunter_3359 Jul. 18 07.16 By Leith van Onselen When we look back in 30 years, we are likely to view the current political term as one of the most divisive eras in Australia's political history. Debate over the Budget has reached shambolic proportions with some $40 billion of savings measures at risk of being blocked in the Senate. We've got the Palmer United Party flapping in the wind and seemingly changing its position on key Budget measures on a daily basis, whilst promising a range of pie-in-the-sky and unworkable proposals. We've got Labor and the Greens opposing nearly every Budget measure because they are...
read more

Senate imposes limits on asset recycling

ScreenHunter_2966 Jun. 24 15.17 By Leith van Onselen The Senate has been successful in its bid to tighten scrutiny of the Abbott Government's "asset recycling" program, last night pushing through changes the bill that should improve project selection and accountability, and deliver taxpayers better value for money. As reported in The Guardian, the Senate has imposed conditions requiring that infrastructure projects worth more than $100 million be assessed by Infrastructure Australia with a published cost-benefit analysis. It has also required that all incentive payments by the Commonwealth to the states require a...
read more

Weekly RP Data Australian house price update (members)

ScreenHunter_15 Mar. 05 15.42 By Leith van Onselen In the week ended 17 July 2014, the RP Data-Rismark 5-city daily dwelling price index, which covers the five major capital city markets, rose by 0.39%. It was the fifth consecutive week of rises (see next chart). The growth nationally was driven by a strong rise in Melbourne (see next chart). Values are now up 1.62% in July, driven by massive gains in Melbourne and strong gains in Sydney (see next chart). Values are up by 5.05% so far in 2014, with all major capitals except for Perth experiencing growth, and particularly strong gains recorded in Sydney...
read more
Page 1 of 15712345...102030...Last »