Links 24th July

Global Macro:

  • Dow tumbles 101.11 points. Wall Street Journal
  • But oil services firms are booming. The Economist. Next week Macro Investor will be presenting some different ideas about mining services.
  • Capital expenditure versus the capitalist executive. Buttonwood. Some intriguing findings about corporate governance and incentives.
  • Violence flares again in Iraq. Voice of America
  • Should we buy the dip on oil? Blast hits Iraq to Turkey pipeline. Digital Journal.  Kurdish separatists blamed. (luckily it’s back online … for now)
  • Meanwhile Turkey sends missile batteries to the Syrian border. AFP
  • Arab League offers Assad an exit strategy. Financial Times
  • And Damascus vows to not use chemical weapons. BBC

United States:


  • The pain in Spain continues. Financial Times 
  • And spreads to Germany, Netherlands and Luxembourg: all placed on negative credit outlook by Moody’s. FT Alphaville
  • But at least one hedge fund manager is getting bullish on the Eurozone. New York Times
  • Though first, Europe will need to sort out the single bank supervisor impasse. Wall Street Journal
  • And sort out the rules that govern ECB policy. Forbes
  • Elsewhere, Leveson inquiry extends to The Mirror and The Star. Guardian. Murdoch’s not the only villain in this morality play.


  • Is the BrahMos ASCM a game changer in Asia’s arms race? The Diplomat
  • Indonesia Asia’s new FDI magnet. Asia Times Online
  • Pressure growing to end China’s one child policy. New York Times
  • CNOOC to acquire Canada’s Nexen for $US15bn. DealBook
  • Beijing floods kill 37, spark anger, questions. Wall Street Journal. Beijing’s drainage infrastructure is third world but Chinese now expect more.
  • Are destroyed wetlands and deforestation to blame? China Digital Times
  • It’s not too much Chinese infrastructure it’s too much uneconomic infrastructure. FT Alphaville
  • Solution: get everyone focussed on blaming Japan. Chinese nationalists eye Okinawa. Financial Times
  • More China links from Sinocism later today


  • Sex, Lies and Julian Assange. Four Corners. Worth a watch.
  • AMP Capital eyes cost cutting. The Australian. Tough times for planner-linked funds management.
  • If Melbourne builds a train to Doncaster… higher property prices will generate the revenue to pay for it. The Age. $840m
  • Is the mining boom really behind us? Sydney Morning Herald. I struggled to find the argument in this one.
  • BHP reviewing which projects to axe. Australian Financial Review



  1. I see that Doncaster Rail Line/’Property -will-pay-for-it’ report is based on “..the funding possibilities the authors propose are based on a US model called tax increment financing, whereby higher property values boost stamp duty, land tax and local government revenues and help pay for infrastructure projects.” Let’s hope it doesn’t rely on property prices following the lead The States has recently given us

    • The $840 million price tag for the proposed 12-kilometre railway compares with the $498 million cost of extending the Epping line four kilometres to South Morang.

      Holy crap, half a billion dollars for four kilometres of railway? At least the Doncaster route is somewhat better value for money…

  2. I like this one from our friends at BIS Shrapnel.

    THE other side of Australia’s mining investment boom won’t look so bad, according to long-term forecasts released today by BIS Shrapnel.

    The research firm says dwelling investment is about to take off in most of the country and investment in the two-thirds of the economy not exposed to international trade is not too far behind.

  3. The fiscal cliff and rationality. Econbrowser

    “with the current negative real yields on government debt, the government is actually making a profit by running a budget deficit,”

    It doesn’t occur to the writer that there is something fundamentally wrong with this picture????????
    These clowns will rationalise anything.

    • Instead of the rhetorical question, can you actually explain rationally and logically (with real world data) on what is “fundamentally” wrong?

      • Most people can actually see somnething fundamentally wrong with that statement. You wouldn’t understand.

        • You start with an assumption (i.e. most people actually see it your way) and end up with a veiled insult.

          Anyway..Lets move on: put up the facts justifying your assertions or… .

  4. Is the mining boom really behind us? Sydney Morning Herald. I struggled to find the argument in this one.

    The argument is surely about how you define things. What constitutes a boom (and bust) is continually reframed.

    In 2005 iron ore prices of $100 tonne would have been considered boom prices. In 2012 the same prices is called an end of boom by oxygen thieves like Deloitte because of reframing due to prices up around $170-180. Perceptions and definitions altered by framing.

  5. Nice selection of links today guys. Thoughts that jump to my mind:

    If MBs position is that the end of the boom is imminent, mining services companies appear a no go, they’re not even left with the mineral rights! However, if you see long-term expansion, absolutely. Will be keen to see your call…

    Infrastructure in China – good grief, the reis almost no end to the need for what the article terms ‘economic’ infrastructure (eg decent drainage in major cities). I expect this will come over time, although projects in densely populated areas are notoriously complex. “Infrastructure infrastructure economic infrastructure” should continue to be the China mantra!