Macro Afternoon

Stocks in Asia are still unsettled although Japanese stocks are holding up due to a much weaker Yen. While most major currencies are steady, Bitcoin continues to soar and gold is deflating.

The Shanghai Composite continues to fall, down over 0.5% to be at 2917 points going into the close.  The Hang Seng Index is down a similar amount, closing 0.6% lower to 28161 points, remaining well below the previous set of highs at 28500 and now in dip mode below the low moving average band:

Japanese share markets are the standout because of a lower Yen with the Nikkei 225 closing 0.14% higher at 21565 points.  The USJDPY pair is extending its gains from overnight to be just below the 109 handle going into the European session:

The ASX200 has put in a scratch session with a very minor loss to be down 0.1% to 6665 points, still not getting any help by the falling Australian dollar. The Aussie fell on the NAB business survey, falling straight back to the start of July low at the 69.50 level:

S&P and Eurostoxx futures are down 0.3% or so with the S&P500 four hourly chart accelerating into dip mode that could translate to a wider fall back to the previous highs at the 2950 point level:

The economic calendar mainly has central bank wonk speeches tonight with a few Treasury auctions.

Comments

  1. I’m going in and I will win in sin City 4 months to go the Banks legs are opening Give it to me Baby Ah Ah pretty fly Time keeps on slipping, slipping into the future’s $$$$ Pr0fit

      • If Mr Wolf starts sharing pills then we all will and I don’t think our doctors and those that suffer us IRL will appreciate the results. Imagine what a footsore-skippy-haroldus meds cocktail would do? You may as well place a few drops of LSD into a glass of metho. It’d strip the neurones right back. Not good. Let’s keep everyone’s nonsense their own.

      • Wow. Footsore, are you actually saying that the way our economy is being run, and the want for it to be fixed means that we are a bunch of incels? (whatever the fvck that means)

      • Cee …

        Every depression in U.S. history has been associated with federal debt reduction:

        1804-1812: U. S. Federal Debt reduced 48%. Depression began 1807.
        1817-1821: U. S. Federal Debt reduced 29%. Depression began 1819.
        1823-1836: U. S. Federal Debt reduced 99%. Depression began 1837.
        1852-1857: U. S. Federal Debt reduced 59%. Depression began 1857.
        1867-1873: U. S. Federal Debt reduced 27%. Depression began 1873.
        1880-1893: U. S. Federal Debt reduced 57%. Depression began 1893.
        1920-1930: U. S. Federal Debt reduced 36%. Depression began 1929.
        1997-2001: U. S. Federal Debt reduced 15%. Recession began 2001.

        Furthermore this is acerbated by the need for the private sector to leverage in lieu of, not that it always invests in long term productivity, unless there is a bottle neck or dominate market share to extract rents off in perpetuity. I thought Veblen sorted it long ago, but yeah, freedom ….

      • Just to unpack that a bit more Globalisation has highlighted the problems of policymakers having no idea how the monetary system works.

        Milton Freidman thought central bank reserves controlled bank lending, which is why his monetarism didn’t work.

        Ben Bernanke thought banks were financial intermediaries, which is why he couldn’t understand debt deflation when studying the Great Depression.

        No one could see the dangers of financial liberalisation or real estate booms and busts to financial stability, including the central banks.

        They were never going to see the problem with austerity.

        No one had a clue.

        Why does austerity make the public debt-to-GDP ratio get bigger? GDP shrinks more than the public debt. The IMF predicted Greek GDP would have recovered by 2015 with austerity.

        By 2015 Greek GDP was down 27% and still falling.

        The money supply ≈ public debt + private debt

        The “private debt” component was going down with deleveraging from a debt fuelled boom. The Troika then wrecked the Greek economy by cutting the “public debt” component and pushed the economy into debt deflation (a shrinking money supply).

        There are even people in Germany that know why austerity doesn’t work.

        “Austerity can actually increase the debt burden because it causes GDP to decline and hence the debt-to-GDP ratio to rise” Hans Eichel, German Finance Minister 17/11/2003

      • Footsore …

        Ahh the buy product of Charlie the Unicorn … all those pills …. a “special one” [tm] for everyone … because everyone is “special” … chortle.

    • The Traveling Wilbur

      Running up that hill again are we?

      I once tried to buy a fiddy cen album. B’stards were charging over a dollar for it so I had to complain to fair trading.

  2. 8 hours ago:

    Adani doubles down

    Australia’s Newcastle coal, a benchmark in Asia, would need to rise above $100 a metric ton, from about $78 now, for Carmichael to break even, according to Spalding.

    Adani Enterprises Ltd. shares

    The stock has lost 15% this year, compared to a 6.8% gain the benchmark S&P BSE

    Though coal is the most carbon-intensive fossil fuel, Adani has found a relatively friendly host country in Australia, where the economic heft of the resource industry helped re-elect a pro-coal federal government

    https://www.bloomberg.com/news/articles/2019-07-08/billionaire-adani-doubles-down-on-controversial-aussie-coal-mine

    Friendly host country indeed.

  3. interested party

    JohnR posted this in this mornings links and it is worthy of some expansion.
    https://www.macrobusiness.com.au/2019/07/links-9-july-2019/#comment-3387957

    Dec 21 2017…….bad orange man sets up the executive order that locks assets that people hold within the USA if found guilty of serious human rights abuse or corruption.
    https://www.whitehouse.gov/presidential-actions/executive-order-blocking-property-persons-involved-serious-human-rights-abuse-corruption/

    a sidenote….
    Now……..the MSM are going to try to paint Trump as having ties to Epstein. In light of the above EO, do you think he would self immolate by doing what has been done? Not likely imho.

    And on the actual case…… it may take time to play out……. as many extremely high level politicians, religious leaders, business leaders and even royalty are to be implicated in this one, and they will fight all the way. It won’t help them, nothing can stop what is coming.

    Epstein is a billionaire, and very close to ….you guessed it….old bill clinton and his lovely wife, as well as many others.

    Epstein has even claimed in previous court proceedings to have helped the Clintons set up the Clinton Global Initiative……..you all know that one, right?
    Our very own Julia Gillard is a part of it.
    https://www.michaelsmithnews.com/2018/02/gillard-wishes-bishop-delivers-90m-more-for-the-gillard-clinton-affiliated-global-partnership-for-ed.html

    As info slowly trickles into the public focus, you should be able to work out why the Clintons lovely daughter wears a cross around her neck, upside down. ( hint…it has everything to do with what went on below the temple on Epsteins island )

    Popcorn is getting low.

  4. House prices: At some point, a real discussion about our housing obsession is going to be had … SMH / The Age

    https://www.smh.com.au/politics/federal/the-house-price-battle-that-must-be-fought-20190708-p5252k.html
    .
    .
    2019 15th Annual Demographia International Housing Affordability Survey

    http://www.demographia.com/dhi.pdf

    … and … what ‘affordable’ is for various dwelling types …

    Definition Of An Affordable Housing Market – Performance Urban Planning

    http://www.performanceurbanplanning.org/affordability.html

    • I’m surprised to read that SMH article. Not often will you read such truths in the MSM.

    • Read the SMH. Duplicitous.Always. article earlier in the between giving a fvck about work and let’s be real, Morrison was reelected by the aspirationals to pump prime house prices again. Don’t expect any conversation about housing affordability from this Government.

      • Check out the February Update and 2019 sections at http://www.PerformanceUrbanPlanning.org , to see how the New Zealand media ‘participates’ with the release of the Annual Demographia International Housing Affordability Survey (15 to date) late January each year.

        I cant speak highly enough of them !

        We need to see the same in Australia … with well grounded advocacy at States / local government level.

        I am delighted to read this superb article in the SMH !

  5. the floater is currently 0.693ish … failed at 0.697 & 0.695 … hmmmmm

    lolo lol lol ….