Macro Afternoon

Quite a mixed response to the record high on Wall Street here in Asia with Chinese markets falling on the back of continued protests in Hong Kong, with only the Australian bourse putting a positive – and record high – session. Caution is the name of the game going into this week’s big series of economic events, namely the FOMC meeting but also more US-China trade talks and the BOJ meeting tomorrow.

The Shanghai Composite is drifiting lower, currently down 0.15% and unable to get back above 3000 points while the Hang Seng Index fell sharply, down 1.5% to 27976 points. This takes out the recent support level at the 28100 point are for a stark breakdown:

Japanese share markets were also hesistant despite the elevated USDJPY pair from Friday night as Yen strengthened throughout the session. The Nikkei 225 closed 0.2% lower to 21616 points as a result. The USDJPY pair gapped a little lower to the mid 108’s but has recovered nearly half that to remain stable here before tomorrow’s BOJ meeting:

The ASX200 was the standout, finally breaking it November 2007 high intraday and closing 0.4% higher at 6825 points. Only took 12 years….. The Australian dollar is flat as a pancake, hovering just above the 69 handle and looking set to return to its 68.50 recent low:

S&P and Eurostoxx futures are down 0.3% going into the European session with the S&P500 four hourly chart displaying a possible double top pattern and hovering just above the previous high near 3020 points:

The economic calendar starts the week slowly with the usual Treasury auctions, with all the action starting tomorrow.

Comments

  1. Pauline Hanson took an immigration number plebiscite to the senate. You should see the comments on fb, a lot of her own supporters say its not about the number but the mix. It IS the number. This is an uphill battle.

    • GeordieMEMBER

      I think the animal spirits we’re likely to see by the end of the year will be cheap tequila (consumed with or without the worm/scorpion).

    • I’m not convinced either. The fake hype surrounding the the fake news auction results on barely any sales to me is a bit telling

    • Golden Trumpet

      Yeah – how about Australian financial sector being blocked from the EU because our ratings agencies are so poorly monitored that they no longer qualify – there is indeed a conclusion to endless, mindless corruption. We are in the same basket as Argentina and Brazil – the fraking irony. (punny).
      This is a seriously big deal.

      https://www.cnbc.com/2019/07/29/eu-to-strip-canada-brazil-singapore-of-market-access-rights-ft.html

      Sydney Restaurants are closing by the buffet load. Some blame wages, others Uber Eats, others rents, some the lock out laws – does it matter ? The carnage is real. Its a far bigger issue for Melbourne and Sydney (and Lorne, Ballarat, Gold Coast, Noosa etc) than the tumble weeds in the “occupy main street” sit in.

      If the AUD breaks this 69 cent barrier then its straight to 59 cents and thats it. Country is toast.

      Lowering rates and QE will be brought forward which will accelerate the carnage and fro there ratings smashed.

      The crowing over 100 clinker brick veneer 1950’s 1 bedroom apartments selling in Brooklyn Park and Glenroy will be short lived – St Kilda will be down another 30% by midway through next year.

  2. Quantitative Peopling. Classic. I hope it catches on and both sides of politics get triggered.

    • I’m popularizing ‘vibrants’ … so far only twice I had to explain what that means…both times I only had to say “migr…” and the other person was already nodding in understanding… Eeeexcellent!

      • I’ve found just saying I think immigration should be returned to the historical average and then explaining why works better than using derogatory terms. Not everyone agrees with me but, that’s life. Using the term vibrants is kicking down and I much rather pick on the bullies and monsters above.

      • Then where is one to garner some faux sense of superiority or elite’s propagating fear to manipulate …

  3. Whilst everyone seems to think the new housing boom is here, I like to reminisce about the mining boom and how that turned out for many specufesters. Heres a few nice examples.

    Only looking at a 635K loss
    https://www.realestate.com.au/property/9-kurrawan-way-newman-wa-6753

    A cool 520K loss on this one
    https://www.realestate.com.au/property/13-bondini-dr-newman-wa-6753

    A miserly 415K on this gem
    https://www.realestate.com.au/property/15-knox-way-newman-wa-6753?pid=p4ep-pdp|sold-pdp:property-history-cta#timeline

    This one is my favourite. Going for broke (literally) with a nice 700K loss if it ever sells.
    https://www.realestate.com.au/property/16-pingandy-rd-newman-wa-6753

    Warms the cockles of my heart.

    • blindjusticeMEMBER

      amazing, great examples of why we need regulators who arent asleep on the job or purchased. Loons will borrow just about as much as the banks will throw at them. Banks cant take such large losses at many %. It would be fine if it didnt hold the prospect of bankrupting an entire country

    • proofreadersMEMBER

      Looks like these gems are suffering a different form of downward motion to that afflicting some Sydney apartment blocks.

      Good on WA for innovation.

      How good is Straya.

    • Mining BoganMEMBER

      The clown that bought the last one in 2013 must have hit it square in the sweet spot. I’m thinking that was the last area built before the con lady got busted. Have a look at the satellite photos and you’ll see where was going to be the new awesome estate behind it.

      Good luck getting their $350k. Dreamin’.

    • Yes, I’ve been trying to decide whether to buy in WA or Detroit. I might wait until some of those WA prices go a little lower so that I can buy, demolish and sell the scrap wood and copper pipes for a profit.

    • GeordieMEMBER

      See, what you’ve done wrong there is make a sensible conclusion based on the fundamentals of the situation.

    • C.M.BurnsMEMBER

      fed won’t cut again while GDP figures are still as strong as they are (and were strong again today).

      Meanwhile, how many more punches can the australian economy and the poo take waiting for that to happen ?

      • I have no idea. But we have been hit up the arse by so many rainbows that it must prolapse soon…

      • FED may cut 25 points just to shut Trump up. They can use the excuse of “we don’t want to wait until data turns to AUD”. But 25 points will not be seen as aggressive so USD will still appreciate.
        Only thing is 25 points cut will upset lot of gamblers and I think markets will tank in order to force another cut inside 2 months. Gold to continue to go higher as more and more people wake up to the reality that CBs are just playing monopoly game and at some point in not too distant future (5 years max) they will have to start all over again – reset the system.

      • proofreadersMEMBER

        The Fed will cut if they know what’s good for them. Hell hath no fury like a Donald scorned?

      • C.M.BurnsMEMBER

        cheers Trumpet, that’s an interesting development.

        I’m confused though – surely the big 3 ratings agencies (Fitch, S&P, Moody’s) are global and used by banks in all those countries and also qualify for euro bloc certification ? I don’t know, but I’d assume that’s the case.

        Unless they are talking about local regulators (ASIC / APRA) and measurements like tier 1 / tier 2 capital ratios etc ?

  4. Found a copy of “The Land Boomers” in a second hand book store over the weekend. I’ve been looking for this book for ages, so strange it just popped up like that. An old man at the front of the store saw me buying it and commented on how good a book it was. Who here has read it, and what did you think? I’ll start tonight.

    • Never heard of it, looks worth a read though. My want list of out of print books is always growing, nothing better than finding one in person instead of having to order from the internet.

    • Read it a couple of years ago.
      Very descriptive, so fairly lengthy.
      The section on Church and State was interesting, and various religious organisations do not come off well.( Not as badly as the Anglicans in the Irish Potato Famine, but along those lines).
      The descriptions of starving families and children are pretty harrowing.
      There are several National Trust/ historical properties where people owning them spent like drunken sailors, then went broke in the1893 landbust
      -Labassa in Caulfield
      -Villa Alba in Kew.
      They are fascinating to visit, as they were extremely lavish, built largely upon borrowed funds( l think both houses had bankers involved.Villa Alba was built by the owner of a posh private bank).
      There are certainly parallels with some of today’s issues.
      And interestingly, there were bank bail ins, with people having money trapped almost for generations as their savings were turned into bank shares, so they could not withdraw the funds.

      • That’s why people hid their money under the mattress. They didn’t trust it to banks!

    • Locus of ControlMEMBER

      A good book. I bought it a few years ago. Some great stories of fortunes won and lost. Real plus ca change stuff – you’ll be able to draw parallels with today.

      My great great great grand-daddy gets a single mention (went to debtors prison after defaulting on 200,000 pounds of debt). Bit disappointing that more was not said (he gets a single line in the book) but I got onto Trove (National Library of Australia) and found out the rest. Turned out to be a long buried family secret. Absolutely kicking myself we don’t own those blocks today – some were right in the heart of Melbourne CBD.

  5. The Traveling Wilbur

    Well. The Johnson huh.

    $1.7m?

    It’s not worth that, even if the roof works.
    Used to work in it.

    It really really isn’t.
    Gotta give the developer points for having a sense of humour though. On many levels.

    (pun intended)

      • The Traveling Wilbur

        That’s a box load of biscuits that’s two minutes walk from one of the larger parole offices Brisbane has.

        And yes, the kind clients attend.

        And the immediate landscape is, on both sides, the backside of a hill with a better view. Both sides. Quite an achievement really. (the upmost floors will have good views though. and ventillation. apparently)

        Have a think about what kind of house you could get for $1.7m in Brissy. And what the body corp. bills will be. Must cost a lot to service A Johnson.

  6. Gold what is it good for absolutely nothing if u want it u got but knolage has no price

  7. Albo talking it up with the progressives. Not even a hint that the fast path to big Australia is a graveyard for the working class, for social and structural institutions, and for the environment. It’s safe to say that we have major party consensus on extreme population growth and will continue to have this consensus for at least the next few election cycles. https://www.theguardian.com/australia-news/audio/2019/jul/26/anthony-albanese-on-the-reality-of-labors-next-three-years-australian-politics-live-podcast

    Regardless of what we hope will happen, decisions need to be made on what will happen.

    • drsmithyMEMBER

      “People are looking for easy answers.”

      No, that’s completely arse about face. People are well aware that there’s only hard answers from here and are looking for someone with the stones to pursue them. Which, judging by the last few weeks, sure as hell ain’t going to be Labor.

      • He’s has privite school sterilisation like he sons will suffer keep fluffing around 1 day u will get money is no longer money dumb monkey lololololol