Unconventional Economist


Melbourne’s housing BANANA attacks new suburb

By Leith van Onselen Melbourne’s biggest housing BANANA (“Build Absolutely Nothing Anywhere Near Anything”), RMIT planning “expert” Michael Buxton, has spent much of the past decade opposing moves to expand Melbourne’s urban growth boundary (UGB). Curiously, Buxton has also regularly rallied against high rise development across the CBD and inner areas, claiming that it is


Inefficient developer charges killing affordability

Cross-posted from The Conversation: Housing affordability is more than just house prices. It also includes ready access to public transport, schools, good road networks, and of course access to all the basic utilities. However, local governments don’t have the money to build all the infrastructure new housing estates need. So developer charges were introduced as


Fool says stamp duties are good for us

By Leith van Onselen Motley Fool’s Scott Phillips has penned an article in Fairfax arguing that stamp duty is “good for us” because it “acts as a useful handbrake for out-of-control property speculation”: You see, stamp duty isn’t the evil tax that many – but particularly politicians, real estate agents and home builders – think


Our financial regulators are captured

By Leith van Onselen Wayne Byres, Chairman of APRA, presented a speech on Wednesday entitled “Banking On Housing“, whereby he outlined the current state of play with regards to the supervision of housing lending. Byres began by noting that Australia’s banks are overly concentrated in housing lending: The Australian banking system is noteworthy for the


Grattan calls for end to $21b super fee gouge

By Leith van Onselen As reported in The AFR, Australia’s politicians have been urged to implement policies to stop superannuation funds from gouging members with excessive fees, with data revealed at Wednesday’s National Reform Summit by the Grattan Institute showing that super fees cost Australians some $21 billion a year, equivalent to half the Aged


Another 457 visa rort revealed

By Leith van Onselen Another week, another report of an Australian employer opting to hire foreign labour on 457 visas rather than employing surplus local workers. From The Canberra Times: Infrastructure giant Transfield is recruiting temporary migrants to work on some of Australia’s largest electricity networks less than two months after slashing 120 jobs in


Links 28 August 2015

Global Macro / Markets / Investing: Margin Calls Bite Investors, Banks – Wall Street Journal Rising Anxiety That Stocks Are Overpriced – NY Times JPM Head Quant Warns Second Market Crash May Be Imminent – Zero Hedge US Monetary: Impacts on the Global Economy – nhk.or.jp A New Computer Glitch is Rocking the Mutual Fund


SA becomes key election battleground

By Leith van Onselen The Abbott Government could rue the day that it let the car assembly industry shutter. With South Australian unemployment shooting for the stars: Full-time jobs growth and hours worked contracting at a rate of knots: And the closure of Holden in 2017 likely to cost tens-of-thousands of jobs, independent senator for


WEF: Oz most affected by China slowdown

By Leith van Onselen The World Economic Forum (WEF) has published a short report analysing how slowing growth in China, along with its rebalancing from investment towards consumption, could impact the global economy. Not surprisingly, the WEF believes that Australia’s economy will be most affected: China has contributed as much to world GDP growth as


Actual mining capex plunges

By Leith van Onselen The Australian Bureau of Statistics (ABS) today released data on capital expenditures (capex) for the June quarter of 2015, which registered a 4.0% seasonally adjusted fall in capex volumes over the quarter and a 10.5% decrease over the year (see below table). The result badly disappointment analyst’s expectations of a 2.5%


Reform summit dumps the population ponzi

By Leith van Onselen In early 2003, I joined the Australian Treasury where I was immediately introduced to the Department’s “Three P’s” framework, which effectively argued that Australia needed to: 1) boost productivity; 2) raise workforce participation; and 3) increase the population via skilled migration, if the nation was to continue to enjoy rising living


National Rent Seeker Summit final statement

Find below the final statement from the National Reform Summit, which provides a useful road map for reform in the following areas: Productivity and workforce participation; Fiscal policy; Tax reform; and Retirement policy While I broadly agree with the statement’s reform suggestions, I am disappointed at the lack of acknowledgement of Australia’s exuberant house/land values,


Pressure builds on Abbott to reform super

By Leith van Onselen Yesterday’s National Reform Summit turned-up the heat on Tony Abbott to ditch his “captain’s call” to never increase taxes on superannuation. When asked to be specific about tax or spending measures that could help boost growth, former Treasury Secretary, Dr Martin Parkinson, replied that the most obvious way that the tax system


Mortgage arrears climb in mining regions

By Leith van Onselen Fitch Ratings has released its Australian Mortgage Delinquency report as at 31 March 2015, which reveals a clear lift in mortgage arrears rates in mining regions across Queensland, Western Australia and the Northern Territory. The coal mining region of Mackay in central Queensland has been worst hit, with the dollar value


Parko: Australia “sleep-walking” into recession

By Leith van Onselen Former secretary of the Australian Treasury, Dr Martin Parkinson, delivered a reality check yesterday to the Nation Reform Summit, arguing that Australia is “sleepwalking” into a real mess, which could lower Australia’s GDP by 5% over a decade – akin to a recession. From The AFR: “Unless we grab this challenge


Links 27 August 2015

Global Macro / Markets / Investing: Stock-Market Tumult Exposes Flaws in Modern Markets – Wall Street Journal Dow briefly climbs 600 points, S&P out of correction, Nasdaq up 4% – CNBC Stocks Surge, Posting Strong Gains at Close – WSJ The Stock Market Hasn’t Had a Selloff Like This One in Over 75 Years –


Kouk bears up on housing, economy

By Leith van Onselen Al Jazeera’s Sydney correspondent, Andrew Thomas, has produced an interesting video examining Australia’s housing market and economy, which argues that Australia’s luck is running out, and that the economy faces recession if the mining downturn is met with falling house prices. Included in the video is a rather bearish quote from


WA posts big construction lift as mega projects converge

By Leith van Onselen The ABS has released data on the value of construction work done for the June quarter of 2015, which registered a seasonally-adjusted 1.6% rise in total construction activity over the quarter but a 3.3% decline over the year. The 1.6% quarterly lift in construction activity was driven by engineering construction (mostly