Dash for trash sends ASX to post-GFC high

The Aussie dollar is stable today:

Bonds are a little bid:

As XJO powers to an 11 year high. Monthly chart below:

Now trading on 16.5x, plenty of room to blow more bubble as earnings don’t grow but the multiple does:

Dalian is nuts:

Big Iron up:

Big Gas is up with oil:

Big Gold down:

Big Banks are tearing it up on the dash for trash:

Big Realty too:

I can see this blowing higher now as earnings stall, bond yields fall and the equity risk premium skyrockets.

Houses and Holes

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the fouding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

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  1. Hey all, just some info from my recent effort to find some existing ASX products for International Bonds…

    I’m still to look into the following in detail, but they are a start:

    VIF: Vanguard International Fixed Interest (Hedged) ETF
    VBND: Vanguard Global Aggregate Bond Index (hedged) ETF
    VEFI: Vanguard Ethically Conscious Global Aggregate Bond Index (hedged) ETF
    VCF: Vanguard International Credit Securities Index (Hedged) ETF

    Shame they’re hedged (given my opinions on the AUD), but they might still provide some nominal US bond exposure.

    Also, Betashares said they were going to look into a US Bond focused ETF as a result of my enquiry, so it will be good to see if that gets anywhere!


    • Yes, so annoying that they are all hedged – I don’t understand why it is easy to find unhedged international equity ETFs but not bonds. Bring on an unhedged, long dated US Treasury fund!

  2. TailorTrashMEMBER

    BW ……would be interested in how you judge a price entry point on these ….they are usually a mixed bag of bonds …..Is there a quick and dirty rule to judge the entry price ?