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Weekend Reading: 19-20 September 2020

Global Macro / Markets / Investing: Wall Street slumps as most stocks fall; tech leads decliners – AP News Asia stocks defy Wall Street weakness but economy, US election worries cap gains – Straits Times World Bank: Coronavirus pandemic threatens health and education – Economo The OECD is a little more optimistic about the global

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Macro Afternoon

A late surge in stock buying, pushed by Chinese shares has seen most Asian share markets recover from earlier losses, while currency markets are again firming against USD going into the end of the trading week. Gold is bouncing back after breaking its short term symmetrical triangle pattern on the four hourly chart, coming back

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MB Fund podcast: Is Gold the anti-dollar? With John Deniz

In today’s investment webinar,MB Fund’s Head of Investments Damien Klassen, Chief Strategist David Llewellyn Smith, Head of Operations Tim Fuller and funds manager John Deniz turn their attention to if Gold is the anti-dollar. On the agenda, the correlation between USD & Gold, where we see the gold price heading, the US budget deficit and

11

China builds its empty fortress of solitude

Below find a full review of this week’s China data. Apologies for the lateness. Had some “issues”. First out was August credit which has had its ears pinned back with TSF at an impressive 3.58tr yuan. Banks made up a lousy 1.2tr of that: Meaning that shadow finance is roaring ahead again, though this now

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Jobs lift all about bullshit

Via the ABC: Australia’s official unemployment rate fell last month from 7.5 per cent to 6.8 per cent. The result surprised basically all economists, including those at Treasury and the Reserve Bank, who were expecting the unemployment rate to deteriorate again. So what happened? According to the Bureau of Statistics, the number of employed persons

2

CBA: Household income still booming

This month’s June quarter national accounts reported that aggregate compensation of employees fell by 2.5% over the June quarter driven by a heavy 3.6% decline across the private sector: Similarly, total wages & salaries fell by 3.3% in the June quarter: However, household disposable income surged by 2.8% in the June quarter in real per capita

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Ludicrous Adani to ship coal at huge losses

Via the AFR comes a job well done: Adani Mining chief executive David Boshoff has a clear message for the environmental activists and naysayers who have spent the past decade rallying against the $2 billion Carmichael coal mine in Central Queensland – “it’s happening”. Standing on the edge of the first pit being dug at

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CoreLogic: Inner-city rents hammered

The latest rental data from CoreLogic reveals that apartment rents across Sydney and Melbourne have been hammered since the onset of the COVID-19 pandemic, falling by 4.2% and 4.4% respectively between March and August: CoreLogic’s head of research, Eliza Owen, has released additional data showing that properties closer to the city are more likely to

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RBA: “unprecedented shock” ravages rental market

The latest RBA Bulletin contains an interesting report on COVID-19’s impact on Australia’s residential rental market, which it claims is experiencing “an unprecedented shock” with “reducing demand for rental properties at the same time as supply has increased”: The COVID-19 pandemic is an unprecedented shock to the rental housing market, reducing demand for rental properties

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Youth labour market climbs out of gutter

Yesterday’s ABS labour force release for August revealed that Australia’s youth – i.e. those aged 15 to 24 years old – led the nation’s jobs rebound. The headline youth unemployment rate fell 2.0% to 14.3%, although it remains nearly three times higher than the rest of the labour market (5.4%): Of more interest, youth jobs

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Temporary migrants angry at Australia

A nationwide survey of international students and temporary migrants reveals anger at being excluded from welfare payments like JobKeeper and JobSeeker. Accordingly, many would not recommend Australia as a destination: A nationwide survey of 6000 visa workers and overseas students found that 70 per cent had lost work during the pandemic and 28 per cent

4

RBA must ignore ABS numberwang

The Australian Bureau of Statistics has joined Australia’s War of Stupid. Recall: For the last few years, that outlook has been a War of Stupid between overly tight monetary policy versus overly tight fiscal policy. The RBA refused to ease for years, demanding instead that Josh Depressionberg spend more on productivity-enhancing investment. Depressionberg pointedly did

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Australia’s Chinese-blocked barley heads for Thailand

Commodities are fungible even if CCP apologists like Paul Kelly are not. Via Bloomie: Government forecaster Abares expects agricultural exports to shrink to A$43.5 billion ($31.7 billion) as prices for many of its exports, including meat, wheat, barley and wine, slump because of the pandemic and Chinese trade restrictions. Barley exports have been roiled by a demand

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The Strayan Weekly

Sir Fomo McSpruikerson is a local billionaire and proud proprietor of The Strayan, a vanity media project designed to boost his assets.  ABC issues apology for allowing critic of Big Australia on Q+A The ABC has issued a public apology, after inadvertently allowing a critic of Big Australia on it’s Q&A program last week. Economist

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Macro Morning

Another sea of red on overnight markets last night with Wall Street stumbling while other risk assets lifted higher. Bond yields lifted slightly while undollar assets like Aussie, Euro and oil prices gained although gold was the odd one out. US housing starts disappointed while the latest BOE meeting left all the settings unchanged, although

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ScoMo the Impaler about to disembowel economy

Cruelty is a ScoMo specialty. Whether it’s abandoning burning Australians, forcing media shots out of those that hate him to show how compassionate he is, dragging the chain on lifesaving COVID measures, or rescuing Australians stuck overseas amid a once per century shock, there is something missing in this bloke. And today our psychopathic PM

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Links 18 September 2020

Global Macro / Markets / Investing: Fed Signals Interest Rates to Stay Near Zero Through ​2023 – WSJ Pandemic crisis: Global economic recovery tracker – FT Why Everything Is Sold Out – The Atlantic Liquidity Will Offset Inflationary Pressures in Bond Market –Analysts – D Market Forces Americas: Under Trump, America’s National Debt Has Increased

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Macro Afternoon

Markets are sliding into risk off mode today in Asia following the sour mood on Wall Street overnight with a sea of red on all bourses. Last night’s Federal Reserve meeting is still seeing USD firm against all the majors except risk proxy Yen which is surging post the BOJ meeting. Gold looks set to

14

NZ GDP plunges an unprecedented 12.2%

Statistics New Zealand released its Q2 national accounts, with GDP plunging an unprecedented 12.2%: Gross domestic product (GDP) fell by 12.2 percent in the June 2020 quarter, the largest quarterly fall recorded since the current series began in 1987, as the COVID-19 restrictions in place through the quarter impacted economic activity, Stats NZ said today.