Macro Afternoon

While the usual safe havens are weaker, Asian share markets are still quite mixed with Chinese markets and their satellites falling back, while the Japanese bourses seemed decoupled and continue higher. Gold has come off again, falling nearly $10 USD to be well below $1500USD per ounce, while the upcoming OPEC meeting is setting oil prices a little higher on speculation of supply cuts.

The Shanghai Composite was taking back its previous gains, but has recovered somewhat post lunch break to put in a scratch session, still above the 3000 point barrier at 3022 while the Hang Seng Index is doing the same, still at 26672 points remaining somewhat overbought:

Japanese share markets are the only ones moving forward with the Nikkei 225 closing 0.4%  higher  to 21392 points making yet another new daily high. The USDJPY pair accelerated up to the mid 107s but has stalled in the afternoon session and is coming back as expected before the City open:

The ASX200 is the worst in the region, falling a decent 0.5% but still maintaining a solid run above the 6600 point level, closing at 6617 points. This was despite a lower Australian dollar which came back slightly on the NAB business confidence survey, currently hovering at the mid 68s:

S&P and Eurostoxx futures are slowly moving lower with the S&P500 four hourly chart still unable to get enough momentum to get back over the 3000 point level again:

The economic calendar is still relatively quiet tonight with some British unemployment data but not much else – maybe a certain frumpy haired PM might be out of a job soon?

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Comments

  1. Okay, as discussed, a thread with some links for @moneymind_ANEP regarding his claims about MMT. Gonna be a long one, so fair warning. Specifically, I’m referring to the following three big claims Wolfgang has made, which can be found in this thread:

    https://twitter.com/rohangrey/status/1170825062003486721

    Seems some think economics is a one size fits all or reductive narrative applicable to everyone all the time …. past and present … chortle …

      • Never thought I would see you of all people linking to corporatist NPR or as some about here like to bell the cat – “The Fake Left” …

        Heads up … its a neoliberal mouth organ.

        • What was EP and how do you arrive at your uninformative opinion.

          The NPR article is just suggestive bloviating based on some wonky historical homilies, contra to the reality based one I offered. Seems Nikola [known gold worshiper*] was reluctant to engage on any level with the information offered and decided a nice Sunday school story would muddy the waters.

          * gold has special powers to store wealth, not that process of how its stored is explained or what is the meaning of wealth that its stores explained. The reader is expected too – just believe – that this all occurs naturally [tm] and only a moron would think otherwise.

          I thought you were a Sanders kinda guy, you know the one with MMT – PK advisors. And for the record gold favors Capital and contra to the faerie tales nations cheated on the gold standard all the time, not to mention most of the devastation visited on the new worlds was due to gold.

          So just remember when looking at the stuff how much blood its actually tainted with, do you believe in magic, and how does it fix a balance sheet recession.

          • “(Nations) cheated on the gold standard.”

            Indeed they did. But you should have seen the cheating once the gold standard was abandoned. During ‘the standard’ debt and GDP grew roughly in lock step. Once gold was tossed, debt just exploded into the blue yonder while GDP continued to amble higher. As a result we are just a hop skip and a jump away from the entire monetary edifice imploding and all those ignoramuses who’ve ignored the warning signs will die poor. Oh well, you can’t help some people 😉

          • @Domenic …

            Don’t understand the use of the term cheating, please establish how its cheating and what factors drove that agency.

            I made my views on GDP and its misuse years ago, never intended to be utilized as the maypole that everything else is driven by – see original author …. thanks neoliberalism …. cough AET and neoclassical ….

            Debt [????] which one, private consumer, C-corp, or public … do tell what agency set up the dilemma after wages and productivity diverged and how underwriting standards were intentionally lowered. You know like how academic standards are lowered so privatized universities make more money [admin and investors (IP knowledge)] whilst society picks up the tab for the sub par graduates inter the job market …. snicker …

          • No I just posted a link to which you responded with a link from NPR that imbues commodity theory of money attributes. I pointed out the particulars and noted your long held opinions on the topic E.g. no trap involved, only responded to your look over hear – which never reconciled any of the perspective my link offered.

            I think its incumbent on you to actually provide a modicum of information, that supersedes that of mine, other than hay look at this ideological perspective about money arrived at by only deductive methodology E.g. nothing necessary needed in backing up what I say, internal logic [biases] all other disciplines in knowledge.

            So can you actually provide something that has references to operation reality or is it just conjecture about some hypothetical case and the expectations base on it.

  2. The picture of the angry Chinese man on the phone in posts about China in MB must be taken when he knew Reus is havin massage with his sent to study not work girls..

    • I’d imagine it would rip through a country like the Philippines pretty quick. They love their pork too, so won’t be much fun for them.

    • ErmingtonPlumbing

      All these people going on about Climate Change, the threat of Artificial intelligence, Nuclear war, the plutocratic reintroduction of feudalism etc etc,…. and yet here we are today faced with an issue of far greater importance.

      Peak Bacon!

      I dont think I want to live in a world without this delicious and essential commodity.
      We need to demand action from our Politicians NOW!

    • Not so much sneezy pig, as bleeding internaly and out all its orifices pig…
      ASF is a nasty one, kind of an extremely infectious ebola for pigs.
      Watch out if this one ever turns zoonotic.
      (Yes, I’m a pig farmer, at least for now)

        • Not in any meaningful sense of the word “plan” as far as I can tell. Yes, they mandate that I have a biosecurity plan (which is just a downloaded template which I put my local vet and ag department numbers into) and I have to make you wear my boots instead of yours if you want to come and meet the pigs, but that’s about it.

          Most of the effort at the moment is going into helping the big pig farms (not me) stop animal welfare activists getting into the factories, using biosecurity as the excuse.

          But given that something like 80% of bacon sold in Oz is made with imported meat, I feel it’s more when rather than if we see African Swine Fever here and it will probably destroy the remenants of the pig industry here (which is at best marginal now)

    • I’ve been having roast pork and crackling twice a week lately, just in case. Bacon for breakfast on the weekends.

  3. After Chris Joye capitulated at the absolute tippy top and bought a property in 2017*, his views on property went from introduce macroprudential to loosen lending standards and heavily against Labor’s neg gear reform. Impossible to have a good debate when journos are mortgaged up.

    The main property commentators questioning the market are or were Janda, chrichton, joye(all bought last 2 years), Shayne wright and young Kohler don’t know their status.

    *revealed in Jolly Swagmen podcast

    https://mobile.twitter.com/ASX1500/status/1171309832554442752

    We know what happened to Kohler:
    https://www.macrobusiness.com.au/2019/09/kohler-the-younger-a-national-case-study/

    Haha actually pretty funny how many of these one time bubble vigilantes become bubble champions. C Joyce is especially funny. Imagine if the top is indeed in and we’re living the bust… Joye bought at the absolute peak of the bubble. I reckon he’ll need to be put on suicide watch (legit)

    • anyone got any thoughts on the best value long term battery for a family of 4 (mum dad two kids, all of whom have computers etc) with an already existing 5kw on the roof?

      anyone got further thoughts on the rooftop solar hot water versus heat pump running off solar panels on roof debate?

      in colder (in winter locales – Geetroit) is the type of angle I am coming from

      • Still not economical. Head over to the whirlpool green tech forum. It’s probably the best forum there, with some very knowledgeable posters regarding offgrid, solar and batteries.

        Heat pumps are also a bit contentious on value as they are so expensive to buy and fix. They save a lot of money in running costs, but depends if you get lucky with a reliable one. People seem to think having an electric HWS with a relay or controller to run it when good solar output is the go.

      • If you mean really long term then Ni-Fe is the way to go, but they are expensive up front and you need a lot of them . Of course most are nickel plated now but the main weakness for all these are the Taiwanese micro-electronics in the chargers………..not the sort of technology for a bolt hole.

      • Gunna,
        I use NiFe batteries (old tech, a 48kw/h set weighs just on 3 tonnes; since I’m running a farm not a car I don’t care about charge density). Keep them away from UV light and they should be good for someplace between 20 to 50 years (I’ve met guys using old Edison batteries from the 1920’s that still give about 80% of their original capacity). If I get even the low end of that life, they work out cheaper than all bar wet lead acid batteries. If I get the middle of the range, they’re the cheapest.
        Downsides: they’re amazingly inefficient, so you need 50% more panels than you thought you needed; You also need to be good at making distilled water; And finding charge controllers/inverters that work well with them is non-trivial (different charge/discharge curves from all other current technologies)
        WRT hot water, I use a wood stove to back up the rooftop solar in winter, which works great. Your mileage may vary (I have ~50 acres of trees to source firewood from).

        • The Traveling Wilbur

          I suspect someone has, more than once, googled “second hand WWII sub for sale”.

          Anything appealing get returned in the results?

      • I would suggest lithium. The price has fallen off a cliff recently. Perhaps look into hot water on demand, I find it more efficient than heating hot water and having it sit around.

      • ErmingtonPlumbing

        If you go Solar Hot water dont get one of those setups where the water is circulated between the Panels and a Ground based tank.
        The Pumps Fk up all the time and are expensive to replace $750+ and so do the sensors and PCBs that control it all.
        Get the Roof top Tank, on its side with the panels below. Simple convection (thermosiphon) moves the heated water from the Panels to the insulated storage tank,…nothing to fk up.
        Make sure the tank is Stainless steel or copper (not enameled steel) you’ll get over 30 years out of them.

        If you’ve got Of peak thats your best booster option with one of these but the correct model of instantaneous Gas heater is another good option.
        When the Hot water has been heated enough by the solar it passes straight through the Gas heater without it lighting.
        If the solar HW is only heated to 40 degrees the instantaneous heater will use a lot less gas increasing the temperature 10 degrees than it would heating 10 to 15 degree water coming out of the mains.

        It should be noted that in the middle of summer and if no HW is being used these panels will boil water. The temperature/pressure relief valves discharge water at 95-98 degrees bringing in cold water at the heater inlet.
        this mild loss of water can be discharged into a rainwater tank I suppose but usually just goes into the gutter.

        As for heat pumps,…they are total shyte.
        https://www.productreview.com.au/reviews/d0607beb-133c-3519-ab44-efb1f3aee574

  4. It seems that Dyldam is either unable or unwilling to offer settlement for their apartment in Carlingford which is now due for settlement. Probably related to being jn liquidation.

    https://insolvencynewsonline.com.au/mega-dyldam-development-yet-to-escape-liquidation/

    This brings an interesting question : while developer can no longer use the sunset clause to rescind contract, what happens if the developer simply refuse to settle? It is not like the buyer would have the money to sue for specific performance..

  5. Someone finally gets it.

    LNP senator compares Australian immigration to ‘over stocking’ paddocks

    https://www.theguardian.com/australia-news/live/2019/sep/10/coalition-labor-morrison-albanese-politics-live?page=with:block-5d7759108f08143ee1ae363e#block-5d7759108f08143ee1ae363e

    Gerard Rennick is using his first speech to call for a cut in immigration, saying as the son of a farmer he was always taught not to “over stock your paddocks”. “There are over 600,000 foreign students studying in Australia, who use infrastructure funded by the Australian taxpayer,” he says. He adds that international students can also work up to 20 hours a week, competing with Australians for work. And he wants universities to guarantee (from the sound of it) that graduates will get jobs and therefore be able to pay back their student debt.

    • Correct me if I’m wrong but to have a student debt requires Australian citizenship unless the debt is directly incurred by the education institute which is an issue in itself. Foreign students pay up front.

      • I think his student debt point is a different one from his immigration point. The debt one isn’t really about immigrants.