Macro Afternoon

See the latest Australian dollar analysis here:

Macro Afternoon

A big surge across the board here in Asia in response to the positive finish to the week on Friday night on Wall Street with Chinese stocks leading the way. The USD has retreated against the risk currencies, namely Kiwi and Australian dollar, but gapped higher against Yen, supporting the risk on mood.

The Shanghai Composite has launched another 2% higher to close above 3170 points, making good on its Friday performance, while the Hong Kong Hang Seng Index closed 1.6% higher to 29542 points. This takes it past the previous high as momentum pushes into the nicely overbought zone as support builds at the previous daily lows at the 28500 point level:

US and Eurostoxx futures have gapped higher going into tonight’s session with the four hourly chart of the S&P 500 again looking to get back to the previous week highs at 2860 points after Friday nights surge:

Japanese stock markets are gaining more  traction because of a much weaker Yen, with the Nikkei 225 closing 1.4% higher to 21509 points, finally making a new substantial daily high after being in a sideways slide for so long. The USDJPY pair gapped above the 110 handle this morning and remains there going into the City open, making a two weekly high but can it stick this tonight:

The ASX200 is the worst performer, but its all relative as it closes nearly 0.7% higher to 6216 points, finally getting above staunch resistance at 6200 points and finally showing some signs of life. The Australian dollar has gapped higher as well with a solid move higher above the 71 handle and advancing this afternoon, almost in line with its downtrend line on the four hourly chart:

The economic calendar starts the week with a plethora of big releases tonight, first up its the March EZ wide CPI print, then US advanced retail sales plus March’s ISM manufacturing print.

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  1. Was this posted already ?

    Adams/North: Scandal – Australian Officials Caught In Covert Banking Meetings

    Golly gosh – never seen the smile wiped off either of these guys faces – let alone both of them. That realisation you have not when you are proven right and are vindicated – but the reality of being right downs upon yourself.

    This is going to go down hard – seriously hard – and literally everything our governments have done will make things worse.

    Imagine being a migrant in the western suburbs of Sydney or Melbourne with 12-15 % unemployment. Youth unemployment in Spain was over 50% – staggering.

    • It wouldnt surprise me if treasury was sh1tting their pants. What gobsmacks me is that they let it go on for so long. Blind Freddy could see the bubble they were blowing and the entire ponzi economy. I guess our so called leaders just think about now and their own polling and damn the future as long as they get that sweet parliamentary pension and a directorship after they leave.

    • Sorry but the basis for that segment sounds to me like a beat up. Of course the Treasury Department talks to economic managers from other economies, of course they conduct “war games” (as John Adams called them) and of course they look at worst case scenarios as well as what they consider are more likely scenarios. If John Adams had got hold of some sort of analysis or briefing paper that had been sent up to Friedburger that would be something different but this … hyperventilation.

      Martin North has built substantial credibility on the back of his data based analysis, he may need to be a bit more diligent in protecting that hard won credibility.

      • The point of the piece is that it was all conducted in secret and on a large scale. Its clearly more than a what if exercise.

        When things go pear shaped, activities like this are put front and center,sure people try and fob them off but they are pertinent.

        “War games” into this type of thing would be conducted in house as an exercise by a junior work experience person – not like this.

    • I recommend reading up about the US States that are being forced by the courts to pay for failing pension funds. It is a downward spiral of rising land taxes and fleeing residents.

      • That’s a shame. People will come to associate land tax with the problem. I can see the same happening here. They’d probably find a way of implementing it so that those sitting on land worth a motza would end up a comparatively smaller amount than those on land not worth that much. They’d also probably introduce it without removing or reducing taxes on labour and productive capital. Or the other ugly ones like stamp duty and GST. Not to mention not getting rid of all the other subsidies that certain groups in Australia have access to which don’t extend to the common PAYG sucker.

        Other mistakes they would make is to not allow an accumulation for those who are not in a position to pay (up to x% of land value and then sell. If x is set high enough people can plan for that. A number that accumulates over a decade should be enough.) One could see them grandfathering so that only new purchasers have to bear the cost of it. Not having a lead in period or subtle shift. Letting Churches and private schools off. Oh the many ways that it could be done in a poor and discriminatory manor by a panicked and prejudiced government makes one believe that we’d see it implemented here in a manner that is aPanglossian. The worst of all possible worlds.

        If it can be done poorly, we’ll do it poorly.

      • It is almost a certainty that when land taxes are implemented in Australia the wealthy will not only use it as an attempt to weasel out of a progressive tax system, but also rig the land taxes so that they pay less per square metre for their harbour-side mansions. Kind of already happening when you compare the council rates of a tiny apartment vs detached housing.