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Chartfest 23-24 February 2019

  AUSTRALIA   5 Eyes Part Time Employment   Australia CPI Housing Wealth and Consumption Residential Rents NSW & Vic, wages & unemployment   Australian coal export destinations   Australian Commodity Exports   Australian House Prices   Australian Housing Finance   Australian Renewable Energy   Australian Services & Manufacturing   Australian Short Term Arrivals  

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Weekend Reading: 23-24 February 2019

Global Macro / Markets / Investing: Mysterious 8,500% Stock Gain Attracts Big Funds (And Big Questions) – Bloomberg Warren Buffett Can’t Find Anything Big to Buy – WSJ Don’t Abolish Billionaires – NY Times Deutsche Bank Lost $1.6 Billion on a Bond Bet – WSJ The Rise of the WeWorking Class – NY Times Look Who’s

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Macro Afternoon

Asian share markets are following the overnight lead with some mild falls and scratch results across the region. The USD rallied against Yuan and Yen, whereas the oversold Aussie has had a little bounce back following the Chinese coal debacle. The Shanghai Composite is steady going into the close, basically up only a handful of

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Fake Greens disgorge fake housing affordability plan

Via Domain: All new Sydney developments would be subject to a minimum 30 per cent affordable housing target in a bid to address the city’s housing crisis under a NSW Greens proposal. The Saving Sydney package, announced on Friday by Greens MP and planning spokesman David Shoebridge, would also abolish priority precincts and restore planning

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New GST law nets windfall from foreign retailers

By Leith van Onselen Overseas retailers that sell inexpensive products to Australians recently had to start paying the goods and services tax (GST). The new impost collected $81 million in its first quarter of operation, significantly higher than the $17.5 million that had been forecast by Treasury. From The AFR: Governments have collected $81 million,

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MB Fund Podcast: China Attacks!

In this week’s webinar we explored the retaliation of China on a number of fronts (recorded before today’s big coal escalation). Join MB Fund’s Head of Investments Damien Klassen, Chief Strategist David Llewellyn Smith and Tim Fuller as we bring you up to speed on the levers China can pull to exert influence on the

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Dodgy lending class action “will not be the last”

Via Banking Day: The plaintiff law firm said the class action was being run in the Federal Court on behalf of people who, after 1 January 2011, were given “unsuitable loans” by Westpac, in breach of its responsible lending obligations. …Principal lawyer and managing partner with Maurice Blackburn, Ben Slade, said: “This case will seek

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“Peak rort”: Why Labor’s franking credit reforms are justified

By Leith van Onselen Chief economist for The Australia Institute, Richard Denniss, has penned a brilliant article explaining why Labor’s franking credit reforms are justified: Some of the wealthiest Australians pay negative tax and still get to call themselves self-funded… Most self-funded retirees have been receiving enormous amounts of other people’s money for a long

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VET rorter caught in student-migration scandal

By Leith van Onselen It was dubbed the “biggest public policy scandal in Australian history: the systematic rorting of the vocational education and training system (VET)”. It was the reckless policy first introduced by the Howard Government and then expanded by the Gillard Government, which gave private VET providers virtually unregulated access to government subsidies for

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Why the Australian slowdown is much worse than the global one

There is one big difference between the global and local slowdowns right now. It is that while much of the world is entering an industrial recession with services economies holding up, Australia is the complete opposite. The US is seeing an industrial slowdown with services booming: Same in Europe exemplified by Germany: Same in China

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APRA sits on Macroprudential 3.0 egg

Via Banking Day: APRA fronted the Senate Economics Legislation Committee – better known as the Senate estimates committee – yesterday and covered a grab-bag of topics, with the overarching theme that this year will be a much tougher brand of regulation. APRA and ASIC will need to be tougher, in order to justify a raft

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Where will the next Chinese bubble be?

Cross posted from Investing in Chinese Stocks. With the January surge in liquidity looming in the distance, the Chinese real estate market is hitting an important turning point. iFeng: 2019年楼市或加速分化 楼市成交整体走低 According to the statistics of the Krui Real Estate Research Center, during the Spring Festival, the data of more than 40 key monitoring cities showed that

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Flammable cladding debacle spreads to suburban homes

By Leith van Onselen Australia’s dwelling construction industry is literally falling apart. After firefighters last month identified 10,000 buildings along Australia’s east coast with suspected flammable cladding, the fiasco has now spread to Australia’s suburbs, with nine more materials commonly used on low-rise dwellings also classified as non-compliant. From The ABC: The alert affects an

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Phil Lowe maintains Futureboom! charade

Right on cue in Parliament comes the Governor of the Lunatic RBA: My colleagues and I welcome this opportunity to share our views on the Australian economy and the RBA’s important policy responsibilities. These hearings are an essential part of the accountability process. Two weeks ago, we released our latest forecasts for the Australian economy.

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First home buyer demand fading as housing busts

By Leith van Onselen CoreLogic has released an interesting report suggesting the surge in first home buyer (FHB) activity is fading as housing values fall: The latest data on housing finance from the Australian Bureau of Statistics for December 2018 shows that perhaps that trend is reversing… In December 2018, there were 8,476 finance commitments

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In case of emergency break glass for Recessionberg

In case of emergency break glass for Recessionberg, via Bloomie: Australia’s Treasurer Josh Frydenberg downplayed reports that a major port in northern China has banned coal imports from Australia and says trade ties between the two nations are “exceptionally strong.” Frydenberg cautioned against “jumping to conclusions,” after Reuters said Dalian Port Group has imposed an

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And there’s the external shock to finish off housing

There it goes. The Australian property bubble is bursting and it is not going to be pretty. MB has previously posited an ultimate fall in house prices of 20-30% in nominal terms from respective city peaks over two price fall periods. That could translate to a 40% fall in real terms over the long term.

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Are you kidding yourself about diversification?

For years, the RBA has argued that an economic recovery is “just around the corner” with wages and inflation about to increase.  So far the RBA has been wrong – their preferred trimmed mean inflation has been below target for 3 years and counting. The issue is the penalty for being wrong during a housing

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CoreLogic weekly Australian house price update: more falls

By Leith van Onselen In the week ended 21 February 2019, the CoreLogic 5-city daily dwelling price index, which covers the five major capital city markets, tanked another 0.22%: Values fell across all major markets except Adelaide: So far in February, home values have fallen by 0.70% at the 5-city level, with all major markets