Macro Afternoon

A mixed start to the week on risk markets here in Asia with another public holiday in Japan taking a lot of volume off the table, while the welcome return of Chinese markets is seeing confidence lift, at least on the mainland. The USDCHF pair had a big flip higher on what looks like another fat finger due to low volume on the Monday morning gap – another reason to bring in weekend trading of FX!

The Shanghai Composite is up nearly 1% higher going into the close, currently at 2642 points and building on its solid run on Friday. The Hong Kong Hang Seng is up only 0.25% or so to be just over 28000 points. This still keeps it well above former resistance, now firm support at the previous false break high at 27300:

US and Eurostoxx futures are drifting down again with the four hourly S&P 500 futures chart showing an unwillingness to get a move on after the late surge on Friday night on Wall Street. Price is still hovering near the psychologically important 2700 point level, but this is looking weak:

Japanese stock markets were closed for yet another holiday, so trading was also muted in Yen with the USDJPY pair remaining a hair under the 110 handle all day. It’s still looking ripe for a breakout here with the upside at least at 112 or even 114:

The ASX200 finished on a weaker note, down about 0.2% to start the week slowly, but still well above the 6000 point barrier at 6060 points. The Australian dollar is largely unchanged with a small rally on the open unable to gain momentum towards the afternoon as it remains below the 71 handle and near the January low.

The economic calendar starts the week with a significant release, the Q4 GDP print in the UK.


    • If smaller banks are crushed but the larger survive Hayne with only a few scratches I expect a campaign to end the banking monopoly and bring competition back to the industry. Seeing the “brokers give you competition between banks” campaign lodged by mortgage brokers I could see this spill over to other business adversely affected by a return to normal lending practices.

      • The argument that brokers are bringing competition is rubbish. Look on page 12 of the Bendigo presentation which showed housing loan growth for the 6 months to Dec 2018:

        Major 1: +4.7%
        Major 2: +3.4%
        Major 3: + 1.8%
        Major 4: – 0.5%
        Bendigo: +2.7%

        There’s plenty of competition there already.

    • I thought Bendigo was 1 of the better community banks? They seem to be willing to lend on alternative building material homes such as Mudbrick, where as other banks are more conservative. We need banks like Bendigo.

      • Mining BoganMEMBER

        Montmorency but don’t know where.

        Edit:seen a few while out running/riding the plenty and yarra trails, mostly on the yarra between Heidleberg and Westerfolds Park. I did see one once in the big open area behind that Yallambie house.

        They’re about but not enough to need an annual snake whacking day.

      • Snakes are not a big deal, mate. I’ve lived surrounded by venomous snakes for most of my life and never had an issue. Not even lost a dog to one or been bitten myself despite being a self-taught relocator. Had a Red Belly come out from under the couch and between my feet while having dinner one evening – nothing a pair of kitchen tongs couldn’t handle.

      • I suppose the question is how to keep them out of the house.

        Hard to keep them away from the entire property I guess (dog? or is that a 50-50 proposition for the dog?)

      • Rats and mice are the biggest lure for snakes in my experience. They generally don’t like the level of activity created by an active household, thus stay well clear unless there is a meal to be had. Pays to make sure you keep the house clear of cover as well so they have little place to hide near the dwelling; also good advice to help reduce fire risk.

      • Mining BoganMEMBER

        I’m going to regret this but an old girlfriend of mine in Kuranda had a scrub python crawl into bed with her. Much screaming and pooing until everyone went their own way.

      • Mining BoganMEMBER

        When we were kids living out the back of Warwick towards Killarney we had a sleepy brown living in the wall for a few weeks. We were all ordered to not walk around that part of the house but that’s where the pepperina trees were and nobody else was going to climb them.

        It was a grand occasion when mum had a gutful and ordered the poor thing begone. I think she remembered the time I grabbed dad’s snake wire and headed off to bag me a couple of red-bellied blacks. Shouldn’t have taken them to school and chased the girls I suppose…

      • GunnamattaMEMBER

        You can get snakes in pretty solid suburbia. I lived in Abbotsford years ago (not far from the Yarra) and recall sitting having a beer with some mates in the back patio area (all pretty much paved) when to everyone’s complete shock (we were all seated) a brown snake moseyed along one of our basil and potato beds from right alongside the house out towards the garage.

        I lived in Canberra twenty odd years ago out on the (actually NSW) road between Sutton and Bungendore (a then heavily wooded rocky area), which myself and my then girlfriend discovered was a black snake migration zone of some sort (which they didnt tell us when we rented). I used to drive an old Toyota landcruiser ute with the spare wheel fixed to the back of the cab standing up in the tray. One morning on the way into work i just vaguely caught something in my rear vision mirror and, not being able to work out what it was, turned around while driving to realise a black snake had been inside my spare and was trying to work out how to get away. it sort of climbed up the back of the ute cab and as I continued in to work it headed down the back of the tray. When I pulled up at the carpark in Civic I took the cowards way out and just walked away – it was gone when I came back (with half the office who all had their cars parked in the same place).

        In Geetroit I am about 400 metres from water, and make sure the kids all have some basic awareness. If one came into the house (god forbid a bed) there’d be some mighty serious pooing. I have a woodpile in the garage I make sure no small rodents or frogs hang around, and bait the bejeezus out of the rodents about. I have two neighbours with dogs, which I reckon helps.

      • The Traveling Wilbur

        @MB Being a bit harsh on yourself there mate.

        Still I’m sure you’ve admirably handled worse.

      • My grandparents lived next to a swampy snake pit…. the area actually supplies a huge variety of the snakes supplied to reptile parks around Oz. They’d have strategic shovels, lengths of bullwire or a .410 sitting around, but that was then, this is now……. What I picked up through them & my own encounters –
        Be alert, not alarmed. They do focus the mind when the action is on & you don’t know whose going to get bit between yourself or your dog or the snake. If it’s early enough in the encounter, or an impasse, you can try to give the snake it’s excuse to bid it’s leave by throwing a set of keys for it to set on & break eye contact while backing away. Just don’t distract the dog’s attention if the flurry’s kicking off, you’ll get ’em bit.

        If you want a dog that can stand up to them, get an aussie terrier, their longer/thicker neck ruff is bred into them to help keep the fangs away if the snake get’s the first one in. They’ll get a lot, but eventually the snake’s more likely to win as the dog ages. Some cats do well too. Geordies advice of reducing their enticements is sound if it can be achieved too.

      • Thanks for all the tips/advice, I’m not too worried about snakes really. My family has owned a property in Kinglake Victoria for over 80 years now, I have never seen a snake on the land in all my 36 years. My mum does though in summer as she spends quite a bit of time in the garden, cutting grass and growing vegetables. Mostly Tiger Snakes, they are usually more afraid of her than anything else and slither off, once the dogs saw a snake and were barking their heads off and my mum says she doesn’t know how they didn’t get bitten. But I’ve never seen them, I guess if you keep the land / grass clear and short it’s ok and easier to spot them. Remove logs/debris on the ground etc.. and anything that would attract vermin and you’re less likely to see them.

        My mum’s land has LOTS of rabbits. So that probably draws in the snakes.

      • ChristopherJMEMBER

        We have a couple of chooks and, as anyone will attest, the eggs are worth it. Had four, but lost one to a sea eagle and one to scrub python, but that’s been my choice to allow them the whole block, including the front as we have a boundary fence.
        We have two mini foxys. Diamond Jack is five kilos, but he shows no fear in dispatching snakes of any size. Bites them and then snaps them back and forth with his head. I never get to see them before he’s already heard or smelt them…

      • @Colin, no not a prepper, the rabbits are just pests. Hard to get rid of them. We do see foxes about, but they don’t really keep the rabbit population in check.

    • Is AOC a Sanders-like “we’ll help foreigners in their home country”? Or an open-borders protagonist?

      • Being the daughter of immigrants, I would say she is sympathetic to immigrants in general. But I fail to see how immigration has anything to do with what is in this video.

        Right wing trolls were doing the exact same thing with the RC corruption article the other day. They took a blatant example of the corruption surrounding our crony capitalist system (the Banks writing their own RC), and turned it into a union love immigrants hurr durr whingefest. It was some stunning idiocy.

      • So you’re all for vested interest groups influencing government for the sole benefit of corporations and their wealthy patrons?

      • I am dead against all vested interests including the fake left versions.

        How many unions do you see campaigning for the re-nationalisation of the pension system?

        Why does Sally McManus cheer on high immigration? Does she really represent all workers, or just tradies?

      • I don’t give a toss about your personal bias. You took a video about dirty money in politics and made it about your agenda. Your intent seems to be to obfuscate for big business-elites and the continuation of their outsized influence on government. But yeah, look over there, it’s Lefties!

      • It matters not who steals the money or who misrepresents the voters. I asked a simple question. If you can’t answer it then go away. Stick your SJW-like “if you don’t agree you are a right-winger” attitude where the sun doesn’t shine.

        I will only cheer on AOC if she is a genuine left like Bernie Sanders.

      • The “right” have always been a bunch of a-holes. It is the “left” who have stopped representing the middle classes.

        That’s because the “left” has been disappearing for decades and is becoming an endangered species. The Greens are the biggest “left” party remaining. Labor has been Centrist since the ’80s and Centre-right since the ’90s.

      • I altered my comment, Smithy. I mostly agree with your comment. Labor (and the US Dems) have become third-way centrists.

        Greens no longer support working Australians like they used to.

    • So bloody true. Crony capitalism is alive and well (winning). This is what the Left needs to fight above all else.

      She’s impressive. Hopefully it runs deep.

      …though, if she keeps this up, she’ll prob end up becoming the target of some right wing incel nutjob.

    • Chortle at mig … EP …

      Seems he negates that Clinton opened the flood gates to pay to play wide open, and the grand bargain was just a dress stain away, curious though the Clinton’s were moderate cosmopolitan republicans in their day with a long track record of corruption, even before getting into the W.H. not to mention Bills scholarship factors …. and some how this is correlated to AOC in one twitter twitch ….

      I think he could use a bit of fact checking and factor in the massive differences between the two e.g. age, social strata, home location, education and work back ground, I would think mig would be enamored with AOC for being such a prime example of boot strapping … is it just me or is it strange how that is applied a bit willy-nilly ….

    • Sounds like they are 18 months away.

      Plenty of scattered negative indicators but nationally prices aren’t actually falling yet.

  1. Latham throwing hand grenades at Kevin Rudd.
    Comments like these make this man wasted in the NSW upper house, I’d pay to go see him throw comments like these in the Senate.
    “Let’s not forget: Rudd opened the borders and allowed the people smuggling trade to recommence, with 2000 boatpeople drowning, including small children. He’s the greatest migrant killer in Aust history. How does he sleep at night, let alone still lecture us on immigration policy?”
    “The indulgence of the elites: Kevin Rudd lives in New York, yet happy to support Big Australia immigration and increased congestion/commuter travelling times in our cities at the expense of suburban Australia:”

  2. Gee, the credit crunch is a thing. Applied for a $10000 limit credit card and got rejected. Have never paid credit charges as always paid off cards, have no debt and earn $120k+. This are interesting times

      • True dat.

        Bzunica, try understating your income and make sure you drop some used TAB betting slips out of your pocket as you enter the bank branch.

    • The comprehensive credit reporting has probably done you in. Now they can see your actual activity rather than just simple things like whether you miss payments.

      Haven’t churned CCs much since we bought the house – only two in the last 9 months. I suspect I might run into the same problems when I come to do it again later this year since my patterns doing this (get a new card with a sign-on bonus, spend the necessary amount, stop using the card for a few months, cancel it – and never carry a balance) aren’t exactly profitable for the provider.

    • In saying that, there are HEAPS of offers on up to 24 months interest free on balance transfers.

      I had a small residual on a car loan due (had the money but needed some cash flow and didn’t want to roll over into a personal loan).

      Applied for and approved 24 month interest free card with balance owing+10% (can only transfer 90% of credit limit).

      Transferred balance to existing credit card with zero balance so effectively in credit.

      Transferred the credit amount to savings account (less $2.50 transaction fee to avoid going into debit and paying interest).

      Paid the residual with the savings and I now have 2 years to pay the credit card with no interest.

      • Back in the early 2000s (before discovering points signon bonuses) I used CC balance transfers to drop about $25k cash into my mortgage offset. Bounced it around across multiple cards for years. Probably didn’t save me that much in hindsight (and wouldn’t have taken much of a timing screwup to lose all that in interest charges for late payment).

  3. Ermo, any opinions on the Dux hot water systems you can get from Bunnings ? Parents’ hot water karked it last night and they need a replacement. Bunnings has what looks like a pretty good deal – $299 for the install (replacing like for like) and same day if booked by 11am.

    • ErmingtonPlumbingMEMBER

      All vitreous enamel tank HWHs are fairly similar, ya get around 10 years average out of them, a little less if out in the weather.

      I usually try and walk up my clients to a Rheem stainless steel, couple of hundred bucks more but you’ll get over 20 years out of them and easier for me to install as they are lighter and the top HW outlet boss makes the tempering valve install easier/quicker.

      Go with the Bunnings install though,…ill be interested to see if the Plumbing contractor trys to “walk you up” with Tempering valve (required to be changed every 5 years but never is) or old heater removal or having to change pipework due to dis similar (to old) inlet and out let locations.

      I charge 500 on top of materials cost for change over with old heater removal.
      Cheapest storage heaters I get are Rinnai’s from Plumbers CoOp
      (Cheaper for me than Dux from Bunnings)

      • Ta.

        Bunnings do explicitly call out that price doesn’t include removal of the old heater. There’s a hard rubbish pickup due in a month or two, that should do to get rid of the old one.

        Existing system is a Rheem and at least 15 years old (that’s how long they’ve been in the house). Normally I’d go with the longer-lived solution but I have to consider they probably won’t be in the house for more than another 7-8 years and $$$ are getting tight.