Latest posts

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Victoria’s delta outbreak spirals

Victoria has recorded an outbreak high 535 locally acquired COVID cases and one death: Reported yesterday: 535 new local cases and 0 cases acquired overseas. – 45,537 vaccines administered – 61,622 test results received – Sadly, 1 person with COVID-19 has died More later: https://t.co/eUcG50Y3T0#COVID19Vic #COVID19VicData [1/2] pic.twitter.com/85OfKkUeYl — VicGovDH (@VicGovDH) September 17, 2021 Almost

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Macro Afternoon

The selloff has abated somewhat here in Asia with only local markets falling on the back of both iron ore and coal concerns, as the USD remains firm against the risk currencies with gold still flummoxed at well below the $1800USD level: The Shanghai Composite is down 0.6% so far to remain below the 3600

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China lackies spew over AUKUS

So says China Development Bank advisor, Paul Keating: “If the United States military with all its might could not beat a bunch of Taliban rebels with AK47 rifles in pick-up trucks, what chance would it have a in a full blown war against China, not only the biggest state in the world but the commander

5

Australian property market August 2021 update

August 2021 Australian property market affordability update Australian property market prices continued to climb over the last month, with the past six months seeing some of the strongest growth on record. Mortgage fixed interest rates were steady, standard variable rates fell slightly but remain significantly above fixed rates.  There are some extraordinary divergences in affordability.

0

Auction market bounces into spring

The nation’s final auction clearance rate rebounded last weekend following a big fall in auction listings in Melbourne. CoreLogic recorded a final national clearance rate of 73.7%, up significantly from the prior weekend’s 67.7%. Sydney’s final clearance rate remained strong at 82.8% versus 81.2% the prior weekend, whereas Melbourne’s rebounded to 55.0% from 43.8% the

18

Aussies back nuclear subs deal

A snap opinion poll from Roy Morgan Research suggests the majority of Aussies back the federal government’s nuclear submarines deal with the US and UK: A majority of 57% of Australians approve of the Federal Government’s agreement to buy nuclear-powered submarines from the United States, 43% disapprove according to a special Roy Morgan Snap SMS

25

Evergrande losers take company executives hostage

Via Straits Times: Footage of Evergrande’s management being held hostage in company offices by anxious retail investors made the rounds on China’s social media earlier this week. “I have with me Nanchang’s top Evergrande representative surnamed Chen,” said WeChat user Yang Qiwen, referring to the city in Jiangxi province in south-eastern China. The posting included

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Morrison Government corruption knows no bounds

Michael Pascoe has done a terrific job exposing the widespread corruption flowing through the Morrison Government’s veins: There’s pork barrelling, then rorting, then corruption and bare-faced corruption, and now a new low: Inviting the public to rejoice in looting. In just half a week, the Morrison government has managed to plumb two new lows. Most

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Proof COVID vaccines work

A recent survey of hospital ICU admissions in the United States showed that the overwhelming majority of COVID patients were unvaccinated: ABC News contacted 50 hospitals in 17 states, and asked them to share data on their ICU wards’ current COVID-19 patients, including their vaccination status. In the surveyed hospitals, ABC News found that the

2

Global energy crisis calms a little

Thermal coal and LNG futures both came off overnight. The former: The latter: Oil was still strong as we await the return of hurricane shuttered US production: Beijing continues its campaign to reduce power output. After steel cuts, which have curtailed a lot of EAF production, next is cement: Several Chinese regions have imposed restrictions

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NSW records 1284 COVID cases, 12 deaths

NSW Health has recorded another 1284 locally acquired COVID cases and 12 deaths: NSW recorded 1,284 new locally acquired cases of COVID-19 in the 24 hours to 8pm last night. pic.twitter.com/dLQxxhoiBB — NSW Health (@NSWHealth) September 17, 2021 An age breakdown of the deaths are as follows: Two people in their 20s Three people in

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Credit impulse signals doom for markets

A superb note from Nordea: The credit impulse has received a lot of attention as an asset allocation variable over the past years, and as the credit impulse is now clearly weakening, we go through how to position yourself for weaker credit growth. The credit impulse variable has been widely debated as a global asset

3

UBS: Sell Fortescue, RIO

And here they come. UBS on FMG: Downgrade to Sell: iron ore fundamentals deteriorating faster than expected We downgrade FMG to Sell (from Neutral), cutting our target to A$15/sh (from A$18/sh). Since peaking in July, the stock is down 34% while the iron ore price has more than halved. At spot (~$113/t) FMG still generates

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Australia’s nuclear fallout

The FT sums up the strategic importance of the new subs deal: China’s geopolitical ambitions face a formidable new challenge after the US agreed to help Australia build at least eight nuclear-powered submarines and supply it with long-range Tomahawk missiles, regional officials and analysts said. The agreement, part of a new trilateral security partnership that

29

Evergrande breaks Chinese property

Evergrande. Remember the name. Australian historians will. Yesterday it broke the Chinese property sector as its bonds were suspended: In order to ensure fair information disclosure and protect the interests of investors, after the company’s application, all existing corporate bonds of Evergrande Real Estate will be suspended for one trading day from the opening of the

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Victoria records 510 COVID cases, 1 death

Victoria has recorded 510 new COVID cases over the past 24 hours alongside one death: Reported yesterday: 510 new local cases and 1 new case acquired overseas (currently in HQ). – 43,993 vaccines administered – 55,476 test results received – Sadly, 1 person with COVID-19 has died More later: https://t.co/OCCFTAtS1P#COVID19Vic #COVID19VicData [1/2] pic.twitter.com/wUJpxXCugD — VicGovDH

5

Macro Morning

Wall Street volatility spiked significantly overnight in the wake of the latest strong retail sales data with the USD firming strongly against many of the risk currencies as a result, particularly the Aussie dollar which continues to fall in line with iron ore. Bond yields lifted across the curve while other commodities inched higher, although

7

Australian dollar crushed with iron ore

DXY is up and away on the growing energy crisis with US oil and LNG set to benefit. EUR was squashed: The Australian dollar was flushed with commodities: Oil was up and gold down: Base metals are a raging bubble fit to burst. 10% of global copper goes into Chinese property. Almost all nickel into

0

Youth labour market smashed by lockdowns

Yesterday’s employment report from the Australian Bureau of Statistics (ABS) revealed that Australia’s youth – defined as those aged 16 to 24 – have been hit hard by lockdowns. Total youth jobs fell 75,400 in August, driven by an 80,000 reduction in part-time jobs, partly offset by a 4,500 increase in full-time jobs. Accordingly, youth

7

CoreLogic weekly house price update: Same ole, same ole

In the week ended 16 September, the CoreLogic daily dwelling values index increased another 0.34%: All major markets recorded rising values. Note, Perth’s daily index has been suspended while CoreLogic investigates anomalies: Values have so far risen by 0.74% this month, with all major markets rising: Quarterly price growth remains turbo-charged but slowing at 4.82%

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Links 17 September 2021

Global Macro / Markets / Investing: Where Has All the Money Gone? – Project Syndicate Lumber crash leads to ‘blowout’ sales as prices crater – CBC What might cause the next financial crisis? – Law Liberty Sweatshops Won’t Help the World’s Poor, but Unions Could – The Nation Americas: Poverty Declined In 2020 Due To

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Macro Afternoon

The selloff continues here in Asia as the fallout from the Evergrande collapse spreads throughout the region, with only local stocks rebounding on the latest unemployment figures. The USD is firming once more against the risk currencies with gold still holding below the $1800USD level, while Bitcoin has picked up again, pushing through the $48K

12

Property listings collapse from coast-to-coast

The PropTrack Listings Report for September has been released, which assesses listings on realestate.com.au. The latest report reveals that property listings continue to fall across both capital cities and regional areas: Right across Australia property listings have collapsed, down 23.9% nationally year-on-year. The only notable exception is Melbourne, which was in hard lockdown this time

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Five lessons from the semiconductor shortage

BofA with the note, in the hope that Canberra gives a flying $%&#: Autos, chips and Covid: five economic lessons Global supply chains are in disarray. A series of pandemic-related shocks have disrupted production, while goods demand has soared as consumers have substituted away from high-touch services. Each item faces its own specific set of