Boxing Day Links December 26, 2018

Heat Haze, Dorrit Black, 1919, Art Gallery of NSW


Macro & Markets








Terra Heatwavus


…and furthermore…

Latest posts by Gunnamatta (see all)


  1. The Traveling Wilbur

    OK, so own up. How many others of you got a Fitbit (et al) for Christmas?

    And how many of you managed to resist the temptation to name it “Fat ba5tard”?.

  2. The Traveling Wilbur

    In other news, the big day is *finally* here. It’s Boxing Day test time and it’s a great day to be in Australia everybody!

    Thankfully we’ve got Mitch back in his righful place, thanks to some selectors who finally seem to be showing some commonsense and aren’t cowtowing to the various ‘influencers’ floating about the Cricket Australia executive. Good show.

  3. So, reporting in from Fifo land.Was crush loaded in the Qantas Club in Perth today, and here’s me thinking it would be a quiet one in the club..not least the slab pizza’s were rocketing out at a fast pace..

      • A Gubbermint Public Servant Fitbit Edition?
        Those don’t come cheap…I would have to work another year Fifo to get you one via me taxes…
        Maybe next Christmas? Or , by how we are going, food maybe a luxury..hmmm…??

      • With all due respect, I would suggest that the very last category of worker who should be slagging off on public servants would be FIFO workers. Apparently FIFO workers are the salt of the earth because they go where the well paid jobs are but public servants are bludgers for going where the not quite as well paid jobs are. You lot get paid multiples of the average wage, why not appreciate your relative advantage and stop whinging about how hard done by you are.

      • Partial disclosure: I’m not a public servant, but I often work with them. There are exceptions but almost all seem to be pretty hard workers trying to deliver services because they know they’re needed, and struggling against the constraints imposed by the circus we seem to elect every few years. Imagine working for a leadership team like the one we – yes we the electorate – impose on them every few years. Once we, the voters, accept our responsibility for training our leadership to follow small target polices formed by polling responses, rather than actual ideas and future looking policy, then we can throw off at public servants.

      • The Traveling Wilbur

        Thanks! Very goodwill to all men-spirited. But not deserved. There are some really hardworking ones (smart too), but most are at best well-intentioned (and not very capable) or smart enough but in it simply for what the performance review will say about their targets at the end of the year. Decision makers caring more about outcomes and actual benefits than how the alternatives could reflect on them? Haven’t seen it happen yet, well I did *once*, but I think they got away with it!

      • Not suggesting that public service is any more noble an occupation than other jobs but most public servants are simply trying to pay the bills and bring up their kids, just like everyone else. I do argue that the neoliberals and John Howard have done significant damage to the commonwealth public service. And it is not just in the commonwealth sphere – I saw an engineer argue that of course buildings like the Opal Tower have private certifiers as there is not the skillset in the government sector to do the work. It used to be the case that the public service was chock full of specialists. Now, there are some smaller government agencies in Canberra that have more consultants and contractors than public servants and all the privateers get paid heaps more than the public servants.

      • As someone who works closely with a number of Commonwealth public servants my observation is that most of the people interact with go at it like the hard men of old the vast bulk of the time. Sure you get some duds, but the vast majority go at it (whatever ‘it’ is) and the bulk of the times you facepalm and think ‘why are they doing that?’ it is generally because there is some edict from on high telling them to do ‘it’ that way, usually backed by some legislation.

        Indeed I think one of the great tragedies of the day and age is the systemic and deliberate trashing of the capacity of the Australian public sector, and the binding it with a politically appointed and motivated SES level which all too often has the deliberate trashing of public service capacity as its key focus, and turning public service provision into a smorgasboard of ‘contracted service providers’ all too often providing very little real value for money for the Australian taxpayer, and all too often providing ‘services’ in such a way (most notably with IT services) as to represent a complete clusterf**k for the public servants they are theoretically ‘servicing’.

        I have worked across public and private sectors and dont think there is a real skerrick of difference between them in terms of the way they go at the work. I was once closely associated with the outsourcing of public service functions and have seen first hand private sector competitors for such functions ask the question ‘how the F are they doing that’ – particularly for things like data management/entry/ and handling customers and providing services to end users. I now think that most of the work I did in outsourcing public service functions – which I then thought of as outsourcing shiny bottomed cardigan wearing, overpaid people and replacing them with lean private sector efficiency – as an utter tragedy for the nation. Mainly insofar as the only thing lean and efficient about the private sector providing services for the public sector is the suckling on the public teat they do. A close mate is an auditor with the National Audit Office and I know well that governments of both mainstream sides have fended off an ANAO review of the long term impacts of public service outsourcing (including all the costs and implications involved) for more than 20 years.

      • “With all due respect, I would suggest that the very last category of worker who should be slagging off on public servants would be FIFO workers. Apparently FIFO workers are the salt of the earth because they go where the well paid jobs are but public servants are bludgers for going where the not quite as well paid jobs are. You lot get paid multiples of the average wage, why not appreciate your relative advantage and stop whinging about how hard done by you are.”

        If you actually had a clue you would know that mining wages arent actually that high in terms of the hourly rate. The main reason the salaries are high is because of the number of hours a typical FIFO worker does eg. 2/1 roster = 14 x 12hr shifts = works out to a 56hr working week over a year . Also dont forget the typical FIFO worker rotates between night/day shift, with one week days and one week nights. So get off your high horse about mining personnel being paid multiples of the average wage. Try doing FIFO yourself for a bit and see if the isolation, work hours and conditions (do you think it is pleasant working 500+m underground with the heat, humidity, dust, diesel fumes and potential for injury or death?) are fairly compensated by the hourly rate. Clown!

      • The Traveling Wilbur

        And there you have it Gunna. The reason why outsourcing those jobs is ‘bad’ is the same reason why the public service *does* attract capable, talented people, who might sacrifice a little personally because they see the value of their role *in public service*. I.e. they care not just about a paycheque and putting food on the table for the kids but also about making a difference through their work.

        Despite the assorted muppets.

        Won’t find that in an outsourced role (most of anyway; community care being an obvious exception​).

      • I have worked both FIFO and Government Public Service roles.
        Great differences in roles: hours worked, pay, public holidays etc.
        Life is about choices…
        The above was meant as a light hearted comment, not a sledge.
        But hey, I will keep my female comments private and let the real men comment in future…I gather that is what you want MB to be..

      • And this extract is telling.

        “At present, Australia’s major capital cities: Sydney, Melbourne, Brisbane, etc., are experiencing rapid population growth. Housing demand is just a need, and it must be solved. If we look at it from God’s perspective, the long-term housing price will definitely rise. The key word is to be able to hold it.”

  4. When you have mass-immigration of individuals from culturally discrete nations with markedly lower IQ than the host population;

    Does a welfare state make sense? Isn’t it simply a transfer of wealth from the high-IQ (earners) to the low-IQ (welfare users), discouraging the former from reproducing, and encouraging the latter since conditions are unnaturally better than their homeland? This represent a dysgenic effect, and a fundamental undermining of the entire future of the society.

    If we are going to survive mass immigration, the welfare state needs to go. Keep basic healthcare and education, ditch unemployment, disabled and aged pensions, and institute a flat income tax and widespread land value tax. I’d say 20% and 1% respectively, plus excise taxes on anything with negative externalities – sugar, fossil fuels, plastic, drugs. That plus resource royalties and 20% corporate tax should be enough to fund the whole thing.

    Such a policy would directly benefit the typical Liberal Party voter and doner, at the expense of many current and future Labour party voters. Why havn’t the Liberals every proposed anything like this? Grandfather in some of the current pensions to keep grandfathers happy.

    Ironically many migrants and refugees would do far better under such a system – ‘if you don’t work you don’t eat’ is a great motivator.

    • A device that we could ask our immigrants from the early days of Australia would be great.
      I have a farm , that has an early settlers house still standing upon it.
      It was built by a German immigrant in the late 1900’s.
      If we coud ask him this question, what do you think the answer would be?
      Honestly, isn’t this what we should ask?

    • If Australia wasn’t a big lifestyle upgrade party, then we wouldn’t be able to attract the best international talent to address our skills shortages. The burgers are better here.

    • Stewie GriffinMEMBER

      I presume you’re commenting in regards to this link:

      “This study highlights the importance of Social Security in the minority community. In 2016, Social Security made up a much greater share of total (augmented) wealth of minorities than of whites. On a policy note, efforts to curtail Social Security payouts will have a much more deleterious effect on the finances of the two minority groups than among whites. “

      I think you raise a fair point and one which this Vox article completely misses. It very accurately describes the symptoms and the gap, but the cause remains unmentioned, with the implication being the gap persists because of either racism or some other implied moral failing of white societies. The cause for population groups failing to launch is largely the same reason for individuals failures to launch – being IQ related.

      Asking whether it is moral or fair to import large population groups who will in aggregate amount to little more than a forever burden and unending drain on the welfare state that we built for the benefit of ourselves and our children, is a fair question.

    • “If we are going to survive mass immigration, the welfare state needs to go.”

      No, the ‘welfare state’ has to stay, it is a primary task of a good government.
      However massive ongoing Third World immigration is a the big problem because it’s the root cause of the unproductive property bubble and a deceitful population re-engineering on the side.
      What we now have is an unholy alliance between the globalist Right (massive immigration intake) and the progressive Left (massive Third World immigration intake). The Australia we traditionally think of, is being sacrificed for the failed and unwanted ideologies of neo-liberalism and multiculturalism.

      • I wouldn’t be too happy about that Dennis considering it’s the self righteous brain dead wankers of the left that are the cause of this “effect”

      • His post reminds me of the “women of calibre” paid parental leave scheme from Tony Abbott (or Peta Credlin). High income mothers should get the world’s most generous paid parental leave scheme and mothers who work on the family farm should get nothing!

        I am surprised that he is against plastic straws.

    • DefinitelyNotTheHorribleScottMorrisonPM

      The welfare state should definitely go because it is entirely dysgenic. There are already enough fat smelly Holden drivers in sh1tsville.

    • There we go, a view into the the mind of a Libertarian.

      From the links the other day:

      Probably the two most important points:

      Nassim Nicholas Taleb

      Verified account

      5h5 hours ago
      22- This tweet storm irritated many:

      1) Charlatans with something to sell: without IQ & other *testing* psychologists have little to sell society; there is a vested interest in hacking/massaging the stats & defending the products.

      2) Pple who want some races to be inferior.

      Pericles Abbasi

      Dec 24
      Replying to @nntaleb
      The first clue that IQ is BS is that IQ is forced to fit into a bell curve while financial success or cultural/historical impact is fat-tailed

    • desmodromicMEMBER

      The last couple of trading days of 2018 are shaping up to be very ugly for markets. What happens to USD from here? Does it slide because US markets are weakening or does it rise because everyone else panics?

    • Dumbo Donnie and his offsider Minuchin have really set the cat amongst the pidgins with their plunge protection team stunt.

  5. It’s time to put the 15-hour work week back on the agenda – Conversation

    Can we first get a 30 hour work week? Raise the minimum wage to $30/hour or put in an income guarantee.

    DECEMBER 19, 2018

    Liberals say they are looking at ways to provide minimum income to all Canadians

    An income guarantee in Canada will only cost C$43.1 billion per year. It is outrageous that the dole can be cut to zero!

    11 hours ago

    UBI is being seen as Modi’s best chance to win 2019 mandate.

    From January 2002 to September 2007, real rural wage growth was mostly negative.

    • Yes, you can barely get by on the $20 per – $25 if you’re casual and accept that you mightn’t get work in some weeks…

    • The Traveling Wilbur

      Most of the Aussies I work with only work about 30 hours a week anyway.

      I mean, they get paid for 38, but only do actual work for about 30 of them. And that includes meetings.

      And getting coffee from the cafe.

      • Oh yea, plenty of dead wood in my office. One person who sits playing solitaire all day, an entitled glutton who sits around looking at food porn on Instagram all day, or waddling to/from the kitchen.

        Very very bloated organisation full of complacency. They could cull a significant % of the workforce and it wouldn’t make a difference.

        Kinda makes me hope for a downturn and belt tightening all the more.

  6. Morning MBers. Fantastic weather in Sydney and, as I try to do as much as possible, great time of year to count your blessings.

    But damn! That Dorrit Black on today’s links! I would chuck the tech / internet / crap and happily go and live in a place like that and a time like that.

  7. I flew into MLB a couple of days ago and should have had my camera out. It’s the first time in several years, and I was somewhat appalled by some relatively remote development sites. One was a big block, excellent roads that ended abruptly at the boundaries, quite a few houses covering about a third of the area, and one original size road in. No amenities or nearby township. It strongly reminded me of the Chinese remote development. A few other cleared development areas in similar patches. Just sitting there. Countryside around them miles from anywhere. Some ‘lucky homeowners’ are so screwed.

    • MLB = Melbourne? And what suburbs / areas? I drive through Epping / Donnybrook / Mernda often and it’s shocking…all the way go Whittlesea which I think will be the next slum suburbs.

      Even Yarra Valley has new developments which are horrible right on top of each other and no train line to the city etc.. not sure what they are expecting to happen?

    • I just read through the whole reddit thread but there’s no new information just lots of speculation wrt failure modes / failure points. General consensus is that it wont collapse given that it appears to have stopped moving, so it has returned to a static problem rather than the dynamic progressive structural failure that seemed to be happening.

      I can’t imagine that any council or unaffiliated engineering outfit will want to sign-off that the building is safe, why would they? it would be stupid to get involved if you’re not already involved and if you are involved than you have every reason to tell a few fibs. If you asked me to review the building (I’m not a structural engineer) I’d just play it safe (wrt my own reputation and my own liability) and say tare it down. Probably unnecessary but what happens if there is an earthquake if the building is cracking like this under its own weight than you know there are some hidden surprises when it comes to dynamic impulse stresses that occur very near the epicenter of an earthquake.
      One time I was in Chupie Taiwan when a shallow magnitude 5 earthquake occurred right under the town. The whole building (I was on the 9th floor of a 2005 era building) felt like it dropped by about 10cm and than quickly recovered, it was much scarier than a regular earthquake with lots of rumbling and shaking. The building I was in was completely OK just a few tiles fell off But could you imagine what would happen to these Opal towers under such conditions if they’re already snapping connecting dowels and prestressed concrete members under more or less static loads.
      My guess is that this will trigger Construction Royal commission, and that’ll be just one more nail in the Sydney RE coffin….Imagine if every Merriton apartment is suddenly forced to revalue 40% lower AND make contingency plans to have major structural oversight work done on each and every one of their buildings. Think about it:, what outcomes/findings would a Royal commission need to reach to ensure that consumer confidence was returned to apartment RE? This confidence is systemically necessary for Sydney / Melb to continue to progress/ develop as modern high rise cities.
      Anyway enough of my musings because I have zero knowledge of structural engineering.

      • I agree that this will trigger Construction royal commission (maybe not immediately but definitely following market crash)
        most of highrises in Australia (almost all including probably all of Meriton dogboxes) are fine structurally (they won’t collapse) but they are super poor quality (leaking water, bursting pipes, cracking plaster, poor craftsmanship and material)

        this Opal building will not be signed off as safe by anyone but should be left there as a monument of the dumbest bubble ever – a reminder to make property bubbles so large and so dumb in the future

      • A builder l know was working on some high rise in/ near St Kilda.
        -using Chinese steel,some of which has had serious quality issues.
        -this is the stuff holding up the buildings, as they are just clad internally and externally after that.
        – the steel is supposed to be coated in a concrete skin,which l think( and l could be wrong) was supposed to be at least 2 cm thick.
        He said it was just being skim coated- millimetres of cover only.
        Now,l happen to know that at least one of those buildings leaked every time it rained for over two years( they had a restaurant on the ground floor that got wet every time).
        But the other issue would be steel corrosion l would have thought.
        We live about 1 k from the sea,and everything out of doors,and even in the shed rusts away in record time.
        I imagine in st kilda( right on the bay for those not in Melbourne) it would fast even faster. He said some of it had rust marks by the time they were coating it.
        Does that sound like a realistic problem?

      • I went to the recent Bon Jovi concert and recall driving by this building. I didn’t connect the dots until I looked up the tower on Streetview. I have to say leaving it as a reminder of the dumbest bubble ever would be quite good.

        The whole Homebush area is loaded with similar ugly towers. I’ve often thought, who on earth wants to live here?

    • The Traveling Wilbur

      I reckon it was the subsequent maintenance/services work wot dun it. I mean one of the major risks when polishing an Opal is cracking.

    • Many weasel word statements about not falling over, but anyone that’s seen demolitions knows that the whole side of the building could pancake-down as each level collapses when it absorbs the kinetic energy of the all the levels above it moving down, like that dodgy NZ CTV studio. The central core survives, and the other sides of building may or may not be dragged down.

      Raw Footage of the CTV Building just minutes after the Feb 22nd Earthquake

      CTV Building like Ground Zero

      Timeline: CTV building collapse

      CTV: ‘Believe me, we have anguished over this’

      CTV Building

  8. Just on the Opal thing – 51 apartments were deemed unsafe.

    In a building of 362 apartments there only 100 residents.

    At 2 people per apartment – like magic – the only apartments which were deemed unsafe had people living in them – and all the others, with no one in them – were the unsafe ones.

    Like magic.

      • The Traveling Wilbur

        Also LOL. But no. But if I do ever have one of those I’ll be sure to let everyone know well in advance. Might even put out a call for donations [insert own joke here].

        I just meant it’ll be a while before EP’s intestinal area biome/flora are back to a full complement (EP must have had a biiiiiiiiig night).

  9. Gunna sez “..why not put taxing the rich back on the agenda”
    I say why not start taxing economic rent, to the same degree.
    Eveyone here in Oz thinks they are part of “the rich”, no matter if they are indeed rich or not.
    But to start taxing economic rents, as they were taxed in the not so distant past, now that would be a thing to be proud of
    and be the first significant act of nation building we would have seen in decades.

    • I pretty much agree with that.

      I think everyone should also have a lifetime updated in real time ‘cost to the taxpayer’ figure including all those negatively geared, amortized offsets, all the work done which ultimately stems form the public teat, and all the energy, demand usage and additional on costs mandated by government policy [education costs, road usage, medical expenses etc].

  10. With the UK exiting and yellow vests running around France and several other countries it is a shame that the EU did not take the opportunity of the Greek crisis to seriously change direction.

    But then at that point the EU loving FakeLeft were still fooling themselves that a United Europe was still capable of producing a socialist nirvana and spent most of their time criticising the Greeks and agreeing with the EU technocrats that they only had themselves to blame.

    One of the funniest videos (who said Germans dont have a sense of humour) from that missed opportunity.

    • Its weird you know. In 2011 I was editing and presenting business news for a 24/7 broadcaster in Europe as well as editing research for investment banks.

      When Greece first went into meltdown I did a couple of weeks traipsing around Europe chatting/interviewing maybe 20 chief economist types about what they saw unfolding. Not a single one of them tipped Greece could remain inside the EU, and most of them spoke at length about the debt imbalances loading the EU periphery in particular with major debt issues which were traceable back to a core batch of mainly French and German banks. The majority of them mentioned the need for the Euro to be adjusted to improve the competitiveness of the Euro as a whole. The only guy I recall (and he was from Banco Santander) who rightly tipped that the ECB/EC would try and screw Greece into the ground – but who wrongly thought it wouldnt ultimately be successful as the Greeks would walk – I recall uttering the prophetic words ‘There will be a terrible social reaction and the Euro elite can only face that prospect by becoming ever harsher in their application of power’.

      I still reckon there is a big chance that – although it will be painful no matter how they go about it – the Poms will get themselves out of the EU and be mighty grateful they got out.

      • Amen to that. The EU is a failed experiment as far as I’m concerned. Smaller Goverments in charge of their own districts and people have advantages over big dumb Goverments making decisions for places they have never even set foot in.

      • That’s interesting because the consistent experience I have had downunder is people (often of the ABC watching and Guardian reading variety) blaming the ‘lazy’ Greeks and accepting the line that Brexit is some alt-right trick.

        Generally the EU narrative remains received wisdom.

        There has been very little coverage of the GiletsJeune so far.

        The pigeon hole for them must still be being carved.

      • That pigeon hole is for me.

        It may have been an alt right trick that got the Brexit vote, but the underlying impulse is a generation of people…..

        …..with wages nailed to floors, watching carpetbaggers ranging from foreign corruption beneficiaries, to local rentiers, to tax avoiders of all sort, and often the aged, take them to the cleaners and make them feel poor for not spending and then laughing at them when they do [for the risk involved]. Taking once productive societies ever further down the monopoly capitalist sinkhole of financialised, outsourced, contracted everything, crafting ‘more GDP’ while meaningful existence goes out the window or gets offshored to somewhere else under the name of Free Trade, wondering if their kids will ever be able to afford a house or afford an education or avoid a lifetime of serfdom to some entitled wanker who wants to tell them they arent as productive as he or she is, when the only difference between them is that the wanker has done something, or their dad, or their ancestors have done something dubious to lay claim to access to funds at some indeterminate (and it is ‘class warfare’ to look closely at) point in the past….

        …….who have simply called bullshit on market efficiency, on their own elites and whatever it is that made them elite, on the outsourcing, on the rampant immigration to drive aggregate demand, on the ‘small government and low taxes for corporates (when they are generally being creamed for taxes) – on the whole neo liberal box and dice mainly.

        At the point where it is all heading I dont actually think there is all that much difference between ‘left’ and ‘right’. Steve Bannon touched upon it with the Oxford address which was loaded here not that long ago. Bernie Sanders notes it all the time, and guys like Robert Reich and Chris Hedges regularly nail much the same issues with their leftness and rightness mainly revolving around whatever other virtue signalling they want to carry – on the socio economic dynamics they are very close. I am pretty sure that it is what is pushing Corbyn to carry on with Brexit despite the condemnation of much of British Labour, I am 100 certain it is behind the complete discrediting of Macron, and 100% sure that is why the working classes of the US sniffed at Trump, when they wouldnt give Clinton a look in, and why I tend to the view the only credible Democrat candidate come next US Presidential election is likely to be Sanders (not that i think he will get up or win if he does).

        Regardless of whether it is left or right the identifiable phenomena is that the working people of the Western world have been reamed by their elites insfar as they are being sold…..

        massively increased immigration
        free trade
        smaller government and lower taxes
        low regulation of economic actors (particularly large corporates)
        financialised education and healthcare
        and the sellout of their political representation through lobbyists, foreign interests, and what was once their own trusted media.

        At the moment they are being told to savour the age and enjoy the masses from elsewhere getting out of poverty, or enjoy the ‘others’ getting a place at the table – when they know this is at their expense, and arent sure they will ever get the access they once had again, and are on the verge of going completely feral about that.

        The real tragedy is that in Australia nobody is getting that, and we are being completely snowed with bullshit to preserve the entitlements of the status quo which is serving us this turd.

      • Thank you Gunna. Not sure the Brits are going to get out. I feel there is going to be some trick pulled out which keeps them in the failed Union. As a scouser, I hope to be wrong, the UK gets it’s nationhood and its manhood back, and that Corbyn bests the many forces lined up against him

      • @gunna I have to read your posts, while hating them all the time I’m reading, because they are so accurate. I wish you were wrong, I really do, but fear you’ve absolutely nailed it. Keep writing.

      • Britain was never in the Eurozone. If Greece had been in the EU but not the Eurozone, they could have recovered quickly.

  11. innocent bystanderMEMBER

    no Dorrit Blac 1919 Heat Haze here in Perth this am, but out bushwalking this morning and plenty of smoke haze over the CBD.
    most likely from the Bremer Bay fire down south, which was described yesterday by news,com in a headline as a suburb south-east of Perth – I know the sprawl is bad but Bremer is more than 500km SE

    just a shout out thank you to all the firies out there keeping us safe – they were out to a fire near me on xmas day, hope santa was good to them.

    • +1 from Geelong, where there is mounting sense of unease about the fire risk – with a tough few weeks ahead.

      • Opposite up here, with 300++ mils in my rain gauge this week alone. Bit over it, eh?

        We had almost a week earlier in December with morning temps in the mid 40s, unheard of for Cairns. I know if the drier parts of our country get that, it’s a fire waiting to happen…

    • I thought the same thing. There was more cheering when India scored a four than when Australia took a wicket.

  12. Talking to some older people at work the other day. Acknowledge that r.e is overvalued but shrug shoulders and say so what….we just arent gonna sell it cheaply…its worth x amount dont u knw no matter what the economy does. Psychology is strong. They might not know what the stock market is doing but everyone is aware of what the place down the road sold for and that’s my new benchmark

      • Hill Billy 55MEMBER

        That is what the 1% will tell you. Their actions are the opposite. They settle for cents (or less) in the $. When the 99% wake up to this important reality, then the 1% will be done for.

    • It is when these older people change their minds and decide to get out (in order to protect their cushy retirements) that the bubble will be finally done. It is halfway there as demand has dropped off but we are waiting for the supply side stampede to kill it dead.

      I think if prices continue to decline at this rate we should be there by Easter. What do you think?

      • All anecdotal I know, but the superstar of RE here in Cairns, with the ReMax group, just exchanged contracts on her own property

        Agreed Gramus, but it will be a cashflow driven exit, so perhaps not Easter?

      • next Christmas or Easter 2020. RBA will cut once in Feb/Mar and again around May/June while banks will only pass 1/2 of the cuts. It will get the RE back to slow meltdown until effects of 65c AUD are felt and loss of construction jobs start to show in the employment numbers. Spike in forced sales of houses will start to show up in the numbers too. By now we will also have few mid size developers going bust and panics starts to set in again which will bring accelerated price falls while RBA will be out of ammo.
        This is how I see it playing out and assuming no external shock or trade war with China.
        Expecting and hoping to see 15% price falls by this time 2019 with price falls slowing mid 2019 and accelerating again from Sep 2019. Once price falls accelerate again it will be proper rush for the exits.
        If my prediction turns to be correct then I really wish Scumo wins in May so I don’t have to listen to the morons.. “Libs save and Labour spends”.

        Marry Christmas and happy New Year to all MBers.
        Looking forward exchanging and debating ideas in 2019.

    • “The developer of the Sydney high-rise that developed a crack on Christmas Eve has said the tower is still “a high-quality building” and the evacuation of residents only became a news story because “it happened over the Christmas break”.

      “Bassam Aflak, the director of developer Ecove, said the Opal Tower was “absolutely” safe for residents and criticised “sensational” media reporting in a Boxing Day statement.”

      Woah… What an attitude.
      The NSW Government needs to a call a royal commission into the building industry. I think that is the only credible circuit breaker on this building quality/regulatory failure situation.

      • Mystic MedusaMEMBER

        What a disgrace. Surprised the PR people have not muzzled him. If anything, the media coverage was surprisingly non-sensationalist.

        An RC is a good idea but the NSW govt would be clearly so implicated in any such investigation that they would go to any lengths to avoid it.

      • Not sure the banks lending against it still see it as a high quality building. Same for the insurers writing policies against it.

        If it gets serious we might need to get Frydenberg and Phill whats his name to ask the banks to free the credit. Perhaps remind them that discrimination against property, especially high quality Sydney property, will not be tolerated.

        Any RC into this area is only likely to cause the banks and international lenders to pull back further.

      • The NSW Government won’t want a Royal Commission poking around the connections between developers and the party nor would they want their manifestly weak consumer protection laws or construction regulations exposed for the worthless, toothless waste of legislation they are.

      • Yes, Gramus. We can all see that a properly constructed building (with steel at its core) should never crack. But, they think we are dummies, eh?

      • A Trip down memory lane r.e Michael Daily’s mentor Bob Carr and the development industry.
        A few days out from election day in NSW, the chairman of Visy, billionaire Richard Pratt, said this: “I’m a capitalist. Capitalists can’t vote for Labor [but] I think voting for Bob Carr is a vote for industry and a vote for big business.”

        Bob Carr fronts a Government which has nothing to do with traditional Labor – the proof of which is the huge big business war chest of $12 million Labor used to promote its figurehead, Bob Carr, and Labor’s failure to deliver on transport, health and education for ordinary citizens. And big business, especially the developers who bankrolled Labor’s victory, will want results.

  13. Anecdata from the property front line: In Perth visiting the olds for xmas.

    Went to an equitymate BBQ with some friends. Mate’s girlfriend starting talking about property so I naturally enquired. Turns out she’d bought in Alkimos, which is north of Joondalup about 50 minutes from city, 5 years ago (peak of the boom) for 350k. 4 bedroom house on an estate. Has now taken a 60k hit on the property in the last three years but according to her “it won’t go any further it will just plateau here for a while, it’s a long term investment.”

    Tried to explain the current and future climate for Perth but she wouldn’t really have any of it, it’s a long term investment. To her credit she has a stable job but she’s going to get burned even further. The Cult of Propertology alive and well in WA.

    Aside from that, have noticed an abnormal amount of For Sale signs around the Western Suburbs, notably Subiaco, Floreat, Cottesloe and Floreat. The usually Blue Chip suburbs.

      • Long term indeed. Then imagine trying to move a property with 70 year old bathrooms and kitchen. The holding and renovation costs are not part of the equation. Mind you, at the SYD peak no renovation was required, or even weatherproofing.

    • Yes Stephen, a lot of blue chip Cairns properties suddenly on market after holding for 30 years etc… Need a rich Sydney person (Sydneyite?) do they

      Hey, what do you call a person who lives in Cairns?


    • GunnamattaMEMBER

      calling pfh007

      Your thoughts plug in about here….

      But I would really like the header to read ‘We need to insert a white hot poker up the sphinctre of our banking system’

      and I would like his comments about the democratic accountability of the financial system being at the very top of that system, and being the very lynchpin of that system branded into the foreheads of every last member of parliament and every person earning more than 100K per annum working anywhere in the banking, insurance, real estate and accounting sectors.

      • An interesting and wide ranging discussion though probably a bit ambitious.

        Not much is going to happen unless people develop a better understanding of what public money is / should be and I think the best way of doing that is to expand the role of the RBA but still keep it very limited.

        The private bank shills work very hard to conceal / deny the nature of the privatisation of the power over public money.

        Which is why they roll out smears like loon, crank, extremist or Weimar etc the minute anyone sounds like they might clip their private banking buddies wings.

        The initial steps in addressing the defects in the current model should be modest. If for no other reason than to undercut the hysterical campaigns by the banking crew.

        Accounts at the RBA for anyone who wants one is enough to get the ball rolling.

    • Just make it illegal to repay bank debt with legal tender………..make the banks to once again issue their own notes and let a free market be established on an exchange for dealing in the various notes against legal tender…….then we would have a real time credit rating for them all.

      Notice how they drove out the private notes, they taxed them out of existence. This is the same way the Soviets got rid of private industry when they took over East Germany……..there were not many forced takeovers, they simply taxed them out of existence……….not a lot of difference between capitalism and communism ?

      • communism still makes more sense to me. problem is us humans have not developed as species at a level to implement communism the right way. We are still driven by greed and accumulation of wealth and power. We still believe that we can achieve infinite growth in a world with finite resources. Hence why elites are pushing for unlimited immigration and population growth.

      • Hadn’t heard of L and S, Skip, so thanks. Yet, I am a bit perplexed. I used to think that the business of government is not business. Now, I believe that selling the Com bank was a mistake, that life in Australia was better when it owned Qantas, the Airports and so on. Did you get your check when they were sold? It’s amazing that we still have a postal service.

  14. The Traveling Wilbur

    Loving Mitch Marsh’s contribution to today’s play. His economy rate to now has been superb. Couldn’t ask for more.

    • That pitch…. got people excited by the green surface but it turned out to be a dud. Even Lyon couldnt get a bouncy delivery with overspin. By the time that piece of crap dries out, we will be batting and dodging rockets.
      And Starc laughing hard when his delivery pitches full and takes off like a rubber ball. He should be pissed off with another 4 runs on the scoreboard.

  15. boomengineeringMEMBER

    Terra firma at last can’t believe I didn’t spew. Fast ferry following the maxi yachts at sea.

      • boomengineeringMEMBER

        You can do two, one just goes to out from Bondi that other much further with lunch. We picked the cheaper one $130 ea because of my affinity to seasickness. Lucked in on 2 counts as we went way past where supposed to go, out from Cronulla – Woolongong and me looking out to where we were going getting wind and spray blasted = no seasickness.
        Completely different than TV, even the missus loved it despite her seasick episode. Absolute chaos at the start. Well worth it.

  16. The Traveling Wilbur

    The comment above would make more sense if the comment it was attached as a reply to was still around.

    Still, can’t blame the author of the original (deleted) comment. Probably thinks Halal is an airline flying to Delhi and operating out of the middle east.

    • The Traveling Wilbur

      OK… so the comment above would make more sense too if *it* was still attached to a now deleted comment. LOL.

      Apparently spambot likes bad puns though… which is news. Wait until it reads the one about Summer Equinox, then we’ll see where it’s standards are set.

    • Foundation pilings of such a building should have gone down to bedrock. Rain would be irrelevant.

      • In a sensible country with a functioning housing market, one would indeed expect that. This is Straya!

      • Sometimes it is not economically possible to hit bedrock. Worked on projects where assumptions come into play.

    • Hence why I laugh when I see all the new apartments being thrown up everywhere in Newcastle since height restrictions have been removed… Lots of mine subsidence, and apartments being built on the harbour.

  17. I am a structural engineer in the industry and this sound about right.
    Boom times ahead for remedial engineers.
    Don’t buy off the plan or anything newer than about 10 years old without reviewing very very carefully!!!

    • Reminiscent of some vintage financial product concocted with abusing VaR for short term personal gain, which has – had knock on effects down the road.

      Mate looked over a plan for a 25T vibrating suspended slab only to see the Cad monkeys cutting corners at the office to impress the higher ups. As he was running the job and had to sign off on it he made the phone call, said he was not prepared to accept the responsibility without someone higher up taking the risk.

      He was instructed to re-spec the job.

      Social psychology proceeds royal science every time humans do stuff …. and environmental conditions set the precedent… of that elites have a propensity to be leaders quantifying such norms ….

      • Modern day version Skip is re-spec the job……or we’ll find someone who will. Even better, declare a national shortage of Engineers (who are willing to sign off on anything) and import thousands who will not only bolster the IEAust membership numbers, but who can fly off back to their country of origin if and when it all turns to custard. As a newly minted Struct. Eng. in the 90s the Asian opportunities were endless. The Indos especially loved us. The worm has well and truly turned.

  18. I guess Mnuchin suggested the Plunge Protection Team was still about! Dow, from ~100 down to ~1,000 up – mighty impressive. But it does give whoever wants to sell a better platform to do it from?!