Macro Afternoon

See the latest Australian dollar analysis here:

Only the property crash can sink Australian dollar now

It’s all green again across Asian stock markets, and despite rising COVID-19 cases in Tokyo, Japanese authorities are looking to ease restrictions within the nation, boosting economic hopes, while locally the chance of further lockdowns has had no impact on the ASX200, at least for today. Meanwhile, gold continues to hold above $1800USD per ounce and other undollars like Yuan, Euro and Aussie lift higher as Yen also appreciates against “the King”.

In mainland China, the Shanghai Composite remained above the 3400 point level, up more than 1% to 3438 points while in occupied Hong Kong the Hang Seng Index is holding on to some minor gains, up only 0.1% to 26159 points. The daily chart shows price remains supported after the start of week breakout – but going nowhere:

Japanese stocks had a mixed session with the TOPIX going nowhere while the Nikkei 225 lifted off the floor to finish up 0.4% to 22529 points. The USDJPY pair remains weak here, unable to get back above trailing ATR support and just hovering above the 107 handle going into the City open:

The ASX200 finally put some runs on the board, lifiting nearly 0.6% higher to 5955 points but still remaining under that elusive 6000 point barrier. The Australian dollar was able to make further gains in its post RBA meeting run, but is still unable to break through the 69 handle with a rollover this afternoon:

Eurostoxx futures are up about 0.8%, playing catchup to the positive action on Wall Street overnight while S&P futures are relatively flat and look like staying where it started the week, reverting back to previous resistance at 3130 points:

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Comments

        • Would really like to just fast forward the rest of 2020 and start again 2021.
          Annibus horribulus for sure, one great song after another.
          The only thing about COVID is how it matches the Star Wars titles, although not in order.
          The Phantom Menace, A New Hope, COVID strikes back ….
          The only difference is that Jabba the Hutt runs our Empire and Palpatine runs a completely different empire (pick one).

    • boomengineeringMEMBER

      It’s been said that he was trying to unshackle our debt serfdom from UK by buying back Australia.
      I wonder how much is blocked out?.
      Just ask Trudy Campbell from Australian Citizens Party, we can’t wait

      • An old bloke told me it was our last dash for freedom/independence & then said it was to be done with Saudi money…….?

    • haroldusMEMBER

      I’m really looking forward to seeing what REDACTED got up to while on the REDACTED and then REDACTED REDACTED up the REDACTED while simultaneously REDACTED all of Australia at the behest of the REDACTED REDACTED REDACTED and the REDACTED.

  1. Segregate Victoria

    If everyone took their medicine we’d be free of the virus like Vietnam, Thailand, New Zealand. Taiwan, and China.

    The average Aussie is so impatient and afflicted with ADHD that they’ll put a pair of jeans on Afterpay for crying out loud. Good luck getting that same person to do the right thing and stay home alone for a couple of months.

    Victoria will likely be fighting Wuhan Virus indefinitely now because a bunch of knuckleheads wanted to protest a death on the other side of the planet, meatheads going to shopping centres once a day, people like Bec Judd going to bars to drink cocktails during a pandemic..

    • Mining BoganMEMBER

      My experiences of lockdown Melbourne today indicated to me that we are doomed. No less traffic on my commute. No less foot traffic at my work shopping centre. Pet food shop was frighteningly busy…the girls were very much over having to restock the shelves again and again. Who needs six 20k packs of dog food? Anyhow, social distancing at the dog park had as much discipline as the dogs themselves. The only distance kept was when I went on a run. I think joggers are now as hated by pedestrians as cyclists are by cagers. Time to go back to the bush run. Too many hills there for new walkers.

      This isn’t being taken seriously.

      • Segregate Victoria

        It doesn’t help that half the population thinks this is a hoax, a one world government conspiracy or just a flu.

        Australians take their behavioural queues from Americans and Europeans so it they see Americans on TV or social media not giving two hoots about this pandemic then they think why should I.

        • Don’t know who you hangout with but no one I know reckons it’s a hoax. Complacency is the killer.

          • Its also that people are still conditioned to respond to symptoms, and no symptoms means I’m free to go about my business.
            And COVID takes advantage of that conditioning. Doesn’t matter what culture you are talking about … except the East Asian cultures that have had pandemics in their lifetimes as well as pollution so they have masks already and the social norm is to wear them to protect others.

          • Yeah the businesses that existed to service the daily commuter flow are in real trouble, especially with zero leverage with landlord. Hospitality and entertainment also.

    • Pretty sure the news was that almost none of the new infections were related to the rallies? I believe almost all of them are related to hotels and family gatherings?

      • This 18th June article refers to a person being the third positive case known to have attended the marches – all in flagrant disregard of State of Emergency laws. The quote from the Health Minister at the time was that they “do not believe” the person was infectious at the event. Hardly a categorical denial.
        So, at least three people who were at the march subsequently tested positive. Even if we were to accept the assertion that there wasn’t spread occurring as a consequence of the march taking place, the march itself was a demonstration of flagrant disregard for the importance of physical distancing measures. That alone was damaging to the public’s perception of risk, and Andrews’ cack-handed management was once again central to this, just like the subsequent debacle with hotel quarantine private security subcontractors.
        If Andrews has any respect for Westminster protocol he should offer his resignation as Premier. If his colleagues in parliament fail to demand it, or decline to accept it, then they all shoulder the blame.

        • My post was in response to the original post asserting that the current spate of infections is due to the protests.

          To the extent that the original assertion was rebutted, my comment holds.

          I’m wasn’t commenting on whether the protested should or should not have protested – that’s derivative to my counter-assertion.

        • He got a lot of votes last election though. How much blame should those voters shoulder?

    • I think the Australians are doing the right thing. It’s just there aren’t that many of them anymore.

  2. I’m thinking about buying a house this Saturday. (nice family home, to live in long term). Yes employment is secure. Yes I will need an eyewateringly massive mortgage (repayments will be just under 25% of our after tax income).

    In the ACT, which has been economically insulated from COVID effects mostly (thanks to strong public service employment) and I’m not sure if meaningful house price falls will materialise here.

    Anyone able to opine differently / put the counter case?

        • Lets all add some to the list….I’ll start.

          This will be the biggest property crash on record.

          • Banks control the price. Markets LOL. Why would they let this happen? Sure it is banana republic stuff, but doesn’t mean it won’t be done.

          • Someone has to be the bag holder when the music stops. If you think the banks are going to you are delirious.

      • boomengineeringMEMBER

        Arrow
        Put in a low ball offer and remember when you miss out the next one is always better. Be good if you could keep the missus at bay by looking at heaps flood her brain

        • Ah, the old fuzzin’ of the system! Works surprisingly well too! Plausible deniability too: we are looking, honey, aren’t we?

      • boomengineeringMEMBER

        Put in a low ball offer and remember when you miss out the next one is always better. Be good if you could keep the missus at nay by looking at heaps flood her brain

        • Heheh. This is the only good house we’ve seen for a while (yes, have been flooding!)

      • Arthur Schopenhauer

        I’m with Boomer. Low offer. If they take it seriously, low ball a few more to test the market. If it seems soft, wait for a month or two and try again.

        • Indeed. But Lowballs won’t work if there is more than one bidder. ACT market is pretty balanced at present, not red hot but definitely not weak either. Was weak in March-April but there were almost no good houses for sale either – sellers were nervous and withdrew.

          • Arthur Schopenhauer

            Good luck. It’s worth checking the Zoning if you are going to be there for 20 years. You wouldn’t want medium density townhouses to spring up either side of you, if you are in for the long haul.

    • Mining BoganMEMBER

      As long as you’re happy inside it you’re fine.

      I’m sick of talking to people who are angry at having to be inside their million dollar house. They must be terrible places.

    • I really wish you and your family good luck, and big enjoyment in the new place. You seem you did the math and thought well of the situation

    • FWIW my 2 cents – if it’s a “home” and you are happy with it and can see yourself living long term and even making a few personal changes over time (like the garden, etc) then go for it. It is a great psychological thing having a “home” for your family. However, whilst no one knows what will happen with prices in your neck of the woods it is highly unlikely things will boom – so go for it, don’t budge on your price and be prepared to miss out. There is always another one.
      It’s all very personal so ignore the above freely. Whatever you do good luck

      • I think I agree with all of the above. It would be a good happy house. But I’m not hopelessly emotionally overcommitted … ie If I miss out because someone else Insists on overpaying, I can handle that.

    • Just make sure you love it. I love mine, so I have no regrets but there was a lot of places I nearly bought and would not be happy stuck inside of.

    • Gav and I just bought…are you crazy? It will all topple for sure!!

      What are the benefits of owning vs renting for you?

      Cheaper to own or rent?

      1 or 2 presumed incomes?

      What % deposit?

      Loan period? 30 years?

      What will it mean for you if, for example, you go to 1 income from 2, and the property drops 25% in value?

      • I always planned for worst case scenario. And it’s what I got lol.. good thing I only borrowed a small amount so I sleep ok. Although I’d like a job now.

        I’ve been through 3 interviews with 1 firm and possibly another next week. (Plus a test), Gets a bit long in the tooth. Good thing the missus didn’t quit her job when we moved.

        So bottom line is, buy if you have loads of equity/deposit. And don’t think you can put that money in a safer asset. Plus if you find the right place and want to have a home remember prices may fall but the right place may not be on the market when you want it to be (at that low price). I haven’t found many suitable homes on the market I would want to buy since I bought.

        • arthritic kneeMEMBER

          You sound like me Gav. Did my sums when in the UK and worked out the break-even point with our time there remaining was a 30% decline in house prices so an easy decision to buy. Came home 6 months too late and the GFC did exactly that – a 30% decline.

      • 20% deposit. Two secure jobs. Ownership will mean a lot to us both. Nowhere near as cashed up as Gav was, but enough that I won’t be forced to eat two minute noodles every night…

        • IMHO 20% doesn’t seem high enough in this environment. House prices could slide by that much and then some. I mean, it would only be 5% above reversing the gains in the last leg up. If you don’t get it, every % the house prices drops, your % of deposit increases doing nothing. Still, would be prudent to have a plan on how to ride out a period of negative equity.

          • 20% is probably ok given we can pay more than the minimum repayment each month so we can build up additional equity buffer that way. Plan for -ve equity is to keep paying it off anyway like a good drone!

            And yeah keeping on waiting would be a decent option too, so not too fussed if we miss out…

        • The Traveling Wilbur

          Fcuk you. Gav likes 2-minute noodles.

          🍜😀

          PS I’ve been advocating for people to buy a *home* on this site for years now… and if now is good for you and it’s *the* place you want, great. Stop reading here.

          But at the beginning of the consequences of the most destrucitve economic event in a 100 years? Personally, I’d wait until the banks *stop* extending their mortgage non-repayment periods and see if that was because conditions were improving. Or not.

          Separate topic: If the seller is over 60? Walk away.

          • And as you walk away say to the agent, loudly enough for the boomer to hear: “call me when it’s a deceased estate…. it shouldn’t take long now!”

    • Nice safe DSR even in old world measurements. Canberra’s always been known to be safer due to the high ratio of PS – well that’s what my many PS rello’s tell me. IIRC even when the razor gangs reaped, most comes back as contractors anyhow…. so long as it’s not your head. FWIW… Good Luck Arrow.

      • I think that’s right. I can’t see it truly crashing here In the ACT because unemployment won’t spike. Not unless nationally the banks go under and interest rates spike… and i just can’t see that being allowed to happen by Ye olde RBA and PM Property Council.

    • How would you feel when your new neighbour pays 25% less than you next year? If you can resist the jealousy, then go for it and buy now.

    • Hi Arrow, are you still hunting in the Woden area? Based on auctions on Saturday, Pearce or Farrer I’d guess? Agreed things look ok in ACT now, but cuts to the APS to come in next FY? Good luck at the auction – hopefully you have limited competition and can negotiate something reasonable.

      • Competition. That’s the question. There is a bit of pent up demand right now, some results have been a bit frothy these last few weeks (though not all) but I will not overpay… if someone else does, they can have it!

        I’ll reveal the house later

    • Good luck.
      It’s a home, not an investment.
      Feeling comfortable in your own space is pretty important.

    • The ACT has expensive houses, but so does everywhere in Aus, and we’re on the “crazy but less crazy than other places” end of the scale.

      I agree prices probably won’t drop here as much as they will elsewhere.

      Knowing the amount of effort you’ve put into studying this problem I’d say if your gut feel is that it’s good then go for it.

      My partner is slowly getting her property settlement sorted, so I’ll be in the same boat next year. That will really be the capitulation of The Last Bear.

      Either way, good luck with it.

      • Xi will target Syd before Cbr. And we won’t get washed away by rising sea levels either!

    • SnappedUpSavvyMEMBER

      Just buy it and enjoy it and in 10 years it’ll be worth more then it is now, just buy it and get on with other things

    • TailorTrashMEMBER

      If it’s a home and you can pay the mortgage comfortably
      then it’s a lower risk …..so you pay a million and it drops to 500 k ….so what ?….you can pick up a replacement for 500 K ……and over time it will recover to 1million
      …a home is a home ….if the amount you allocate to owning it is affordable the long term value is irrelevant and will take care of itsself ….
      ….it’s a home ….not a fcuking ATM ……unless you are an equity mate moron …..

    • If you are intent on buying, buy rural at a minimum of 5 Acres.As our emerging depression comes into effect, you will be able to raise lifestock/garden and feed your family

      • Heheh. Not sure I have the skills to manage and defend 5 acres. If we’re into subsistence living then defending it is just as important as growing it.

        But whatever I buy will have room for multiple vege beds plus chooks. So there’s that.

    • Low balls are back

      https://forums.whirlpool.net.au/thread/9w0xjjk3?p=3441#r68802

      i follow 8 suburbs in victoria (east) and they had 27 new listings pop up yesterday (and none of the agents i know!). some with merely 3-5 photos. i spoke to a agent on monday who had a guide at 800ish. basically said look im a FHB and im not splashing anything more then 600k. he said good luck with the search

      comes back yesterday saying we can do 675k on our terms with a quick settlement. Wants me to accept this offer by 3pm today. LOL. and I was busy at another inspection I was planning on low-balling at the time.

      That agent has asked me to drop in (in his words) ‘any offer’. Place is listed in the late 8’s
      felt like a deceased estate!
      im thinking of offering 650 & can i offer a 5 day settlement?

      • Awesome. Love it L. Go for it.

        Unfortunately I am mostly convinced Canberra won’t drop far ( it never went up as far to start with) because of its stable employment and high median income. I waited almost a decade and even in 2018-19 when Sydney went down 10-20% in fairly short order, Canberra barely moved.

        Hence: capitulation.

  3. 1 case on Far South Coast (so far….) & already they’re talking about deeming us as Victorians & cutting us off….
    Is Gladys a Fair Weather Friend?

    • Haven’t you figured that out from the bushfire response yet? I thought you guys didn’t exist anymore?

      Good luck from the Mornington Peninsula. We’ve been locked down with no active cases, though cos everyone from Hellbourne who owns a place down here has come down here miner of us expect that status to last long. At least the local tradies are doing well out of people realising oh oops that’s broke better get it fixed given we’re here for at least 6 weeks. And we’ll get a lot of day trippers who won’t stay at home so none of us are dumb enough to think we’re safe

      • Mining BoganMEMBER

        It’s really quite odd that you lot were included Poppy.

        Odd. Sorry, meant to say dodgy.

      • migtronixMEMBER

        Those happy tradies will spread it nicely. Don’t worry about the zero cases, it won’t last.

      • Has your business taken a dive Popcod, or are people splashing-out with their job-keeper payments? For some it could be a life-saver.
        Keep up the strict covid-safe practices or you could find yourself in hot water. We’ll send Scomo down your way to give you a hand and resuscitate you.

        • Well we’ve got Greg Hunt so we’re already in good company. But as our business which has taken a dive and a bath doesn’t get jobkeeper (local gov ownership is a bit of a downer under these circumstances) if SFM could do something about that it’d be nice!

          At least, at long last, they seem to be saying if you can’t practice social distancing wear a mask. Our household is back into full iso mode, and I’ve been stood down again, at least we’re getting to be pros at this lockdown thing.

  4. migtronixMEMBER

    My secret fetish at the moment is listen to alt-right talk radio blow-hards. They are spinning and twisting about the “communist/bolshevik/marxist” take over of America and that Academia is trying to run a coup on Donald Trump.

    And the piece de resistênce? They think Donald Trump will lead their “movement” if he’s not elected 😂😂😂

    • migtronixMEMBER

      Literally heard this comment today re covid
      “Big pharma is no longer interested in treating disease, *they just want to keep people living longer so they can sell them drugs*”
      .
      I mean, how dare they keep living longer!

    • You don’t think Antifa et al are Marxist lunatics intent on changing the society through violence?

      • migtronixMEMBER

        No. They’re the same ones that did nothing post Seattle 99, nothing post occupy wall st and nothing now.

        And they sure as sh!t don’t get to give $5T to anyone, wall st keeps getting it all.

          • Lol yes I know we have those. And yet apparently snipers are also still useful.

            I guess I didn’t mean an entirely autonomous system. I meant like a bolt-on electronic brain you could put on the sniper’s rifle and it would do all the calculations and aiming. Then you could touch a non vibrating trigger pad softly and bang.

          • Awesome. Thanks.

            Yes I suspected that if I could think of it, someone else had already made it!

          • Replaces that indefinable, instinctive art of terrain/wind reading that only the best can really do.

          • I said “awesome” but I agree it seems a pity when skill is removed from the equation. Is that old fashioned of me?

            This bit was odd: “…the rifle… is so effective that some in the shooting community say it should not be sold to the public.” As though really deadly weapons are fine, but really REALLY deadly ones are not fine?

            I agree it’s a bit unsporting to have a gun that can’t miss… but really, guns are kind of unsporting anyway, at least from the perspective of the deer …! 😁 And surely if you’re a sniper it’s kind of the point to not give the other side a chance?!

        • The machine disappeared a detailed answer……Tech’s deskilling everything…..
          Suffice to say this tech would make all the Elmer Fudds & even your Granny better than the best snipers…… It removes infallibility, which grows exponentially while distance grows linearly……. So I agree it shouldn’t be for everyone. The blokes at the range wouldn’t be happy, but I’ll take one please 😉

    • Shared not secret. In lockdown with alt-right conspiracy nutters. There must a country and western song in that. Or, if not, post punk thrash.

      • migtronixMEMBER

        Best part is its all he has left and you can see it in his twitter feed. Even the Evangelical nutters are walking away because they can’t go to church 😅

        • The Traveling Wilbur

          Not just me then. I finally realised how truly desperate he was when he started doing his last couple of speeches in Martin Luther King started dating JFK impersonation voice. Genuinely thought he was doing FDR initially (then remembered he wouldn’t know who that was).

  5. been using iiNet business NBN connection for 4 days and not a single drop. Commsec Iress drops once or twice a day but reconnects after few seconds.
    With Optus I had dropouts almost daily and that was with my own $300 router. With their router had 2-4 drops per day and had to restart the router once or twice a day. When I told them I am leaving they said “we are dropping your price to $60 per month for next 3 months and we are going to investigate your issue”. My response was along the line of “I called to tell you I am leaving and not report a fault. Please make sure you don’t bill me after my last anniversary date for July.” “You should have done this investigation when I called on two occasions over the last 12 months but then you were saying there was nothing you can do about.”.
    Must be bad with many ISPs as they would have lot of customers not paying and now imagine to lose customers that can afford to pay. fck em.
    Twice I asked them to investigate and they refused by basically telling me this is normal and blaming my router.

    • We’ve been with iiNet for over ten years now. Overall they’re very reliable and they have to be; they’re tech support is fvcking woeful and dog help you if you ever need to call them. How they win awards for sheer incompetence is beyond me.

      • Iinet “support” (Hahahahahaha) will make you want to kill first them in a frenzied rage, and then after a while, yourself, out of total despair. If you are lucky your problem may be resolved before you die.

        • Diogenes the CynicMEMBER

          Hated IInet. Their support is terrible and their billing drove me insane. When I moved I went with Aussie Broadband who are streets ahead of IINet.

      • Interested PartyMEMBER

        Same here….about ten years or so. But no problems at all with tech support. Happy with them overall.

    • I just flicked iinet for belong. Get 4x download and 15x upload for less money per month. pays to shop around

  6. The Traveling Wilbur

    Why do geometry teachers like to hang out together for mutual support?

    Because they know they can get pi with a little help from their friends.

  7. There is an interesting documentary out called Fact fiction
    .Talks about the inversion of the food pyramid and how the is no real evidence on fat from animal products being the cause of the obesity epidemic despite it being medical orthodoxy for so long.
    Good watch i think for those interested.

    • Reus's largeMEMBER

      It was never fat, the sugar companies in the US paid a doc to file a report to the US health department saying that fat was the issue when all along it was sugar, this was so they could keep their corn syrup industry alive in the US.

      Money talks and people die because of it !

      • The Traveling Wilbur

        True.

        It’s only a matter of time until McDonald-Douglass invents an S-bomb.