Macro Afternoon

See the latest Australian dollar analysis here:

Australian dollar drops as RBA talks it down

 

by Chris Becker

Sentiment is mixed again here in Asia with Japanese stocks having a long weekend, while Chinese stocks are falling slightly as a result of the rising Chinese/US tensions. The USD is still weak against all the majors with Bitcoin finally showing some signs of life during the session as gold keeps going higher.

In mainland China, the Shanghai Composite is down 0.3% to 3324 points while in Hong Kong the Hang Seng Index is putting on some mild gains, currently up nearly 0.6% to 25223 points. The daily chart still shows support firming at the 25000 point barrier, but overall the price pattern is still wobbly:

Japanese stocks were closed with the USDJPY pair stalled as well right above the 107 handle, unable to take advantage of any volatility:

The ASX200 had a modest session, lifting 0.3% to 6094 points by taking back some of the previous losses, but still not being helped by a strong Australian dollar that is looking to make another new high tonight as it firms well above the 71 handle:

Eurostoxx futures are up by 0.4% with S&P futures looking to breakout above resistance at the 3270 level – watch the NASDAQ first however as momentum reverts:

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Comments

      • I bought some WPL (Woodside) at $20.22 earlier this week, sold for $21.06 today, 4% after costs. Hoping to repeat it 10 or so times as things fluctuate over the next month or three.

        • If you can stick it out longer, you’ll make a lot more. Oil (and oil stocks) are going to run hard at some point soon (months, not years). You’ll be making a stack more than 4%.

          • DominicMEMBER

            Oil over-supply is going to adjust to some kind of demand/supply equilibrium as it must There’s an assumption in modern economics that supply remains constant (or increases). At least economic intervention is designed that way but it’s utterly false. I’m the meanwhile, oil exploration has plummeted in recent years – owing to low prices and political winds (climate change).

            And then there is money printing on a scale never witnessed before in history. That is inherently positive for commodity prices – Econ 101.

  1. NEW ZEALAND: PROGRESS … URBAN DEVELOPMENT NATIONAL POLICY STATEMENT … URBAN DEVELOPMENT BILL … INFRASTRUCTURE FUNDING AND FINANCING BILL …

    … political responsiveness with regulatory reinforcement for the deepening community awareness of the need for development and new affordable housing … refer IPSOS Issues Monitors since early 2018 … and too … Statistics New Zealand Monthly Building Consent releases (consider the consent rates per 1000 population per annum for Selwyn County and Canterbury region) …

    New rules to help our cities grow up and out … Hon Phil Twyford and Hon David Parker … New Zealand Government

    https://www.beehive.govt.nz/release/new-rules-help-our-cities-grow-and-out

    Access extensive further info …

    https://www.macrobusiness.com.au/2020/07/links-23-july-2020/#comment-3942395

  2. Nice to see
    You eat weeds that were given to English
    So they would not starve are you a pom lol

  3. migtronixMEMBER

    So let me get this straight, first depression in 100 years, biggest deficit ever all means 7 handle here we come? Ok

    • Ronin8317MEMBER

      Bad news = Good news. When Sydney goes into full lockdown next month due to COVID-19 cases hitting over 1000 a day, the handle will be 8!!

      • Australia is a smoldering radioactive crater in the ground, quickly filling with water: PARITY! Woooo!

      • Just wait till we are forced to stop trading with China. The mega AUD boom will be massive. We are the lucky country.

    • What do you want think b4r you answer because
      You have picked nothing any 12 years old is mine
      Will think you are morron

    • Last year the AUD would have dropped a cent easy on the latest SCS confrontation. Didnt even blip it yesterday.

  4. call me ArtieMEMBER

    Why is gold moving in synch with risk assets? There is something wrong with that. Gold is supposed to be a safe-haven

    I can only conclude that it’s inverse reaction, that is to say, anything non-dollar is up

    I am a little bit too tipsy right now to do the hard thinking what that means. AUD up, stocks up, sure…risk on. But gold up? Doesn’t make sense. Possibly only suggesting that the USD is wildly unpopular?

    That is arbitrage, right there

    • It doesn’t make sense to me, except if you conclude a lot of people are stocking up for a big correction. But also a lot of people are still buying equities based on hopium?

      Bit like Banana Man buying all the Chinese stocks. We have our own Banana Men using Robin Hood.

      I’m also seeing record prices for assets.
      https://www.carsales.com.au/cars/details/2002-Nissan-Skyline-GT-R-V-Spec-II-Nur-BNR34-Manual-4WD/SSE-AD-5881070

      Sold for over $300k AUD. I guess people are putting their money into anything but fiat.

      • call me ArtieMEMBER

        Ha ha Gav. You said it but I don’t think you meant to…

        Nissan, Toyata, Merc…anything but FIAT!

        I am ROTFL. Shows how psst I am…

      • haroldusMEMBER

        When I was a little kid my mum had an old Fiat.

        Once she was picking me up from school she honked the horn to say she was there and the horn stuck, and she couldn’t turn it off. It went on for what seemed like 10 years until a kind father of one of the other kids disconnected it. It was sooooo mortifying.

        The other thing I remember is the windshield washer was actually a rubber push button that was an actual pump.

        Finally, I’m not sure if I’m getting mixed up with an old Morris we had, but I think it had those indicators that stuck out from the sides of the windows.

        • Arthur Schopenhauer

          Haroldus, can you recommend a half decent electric guitar less than $500-? (Ie Not a Datsun!)

          • haroldusMEMBER

            I would recommend any of Squier (Fender beginner brand), Epiphone (likewise for Gibson) and Yamaha (they have a series called Pacifica which goes from quite cheap to top end.)

            Often the wood on these guitars is good, but the components are cheaper.

            There are many Youtube sites like “putting good gear into a Squier”.

            If you give me some idea of what you want to sound like/who you like I can have look.

            Oh, also Ebay where I get guitars from, my mate also uses Facebook marketplace.

        • bolstroodMEMBER

          but I think it had those indicators that stuck out from the sides of the windows.
          we called them “Flickers” when I were a lad.

        • Hey Harry…I Just got back from band prac for the first time in 6 months! Fabulous after 6 months of rocking along to band in a box on my computer.

          I used my blue Les Paul Double Cut through the Marshall. Christ…a full drum kit, guitars, bass…there’s nothing like it.

          Are you rehearsing at all?

          • haroldusMEMBER

            We went back to it, but our bass player is so sh!t it depresses me. Never practices and wants to be a guitar player. Only time he plays anything outside practice is when we’ve finished and we’re packing up. Drives me bugsh!t.

            While I am half of the songwriting team, it’s my mate’s band and I have expressed many times my frustration. But I can’t make him sack him, and despite appearances I’m not a total cnvt.

            So I’m sort of glad there’s a break. I feel I’d be forced to quit, but then that would be it for me for bands – too old.

            Maybe I can come to Canberra when COVID is over and I can have a jam with your band, you give me the set list and I learn pretty quick.

      • The Traveling Wilbur

        Right now no one seems to be setting much store in Accords either. Certainly not in the US/Chyna/EU.

    • been doing that for while now. my only take is everyone expects big crash and even bigger margin call. may not happen though.

    • Stock prices up, houses up, gold up, silver up?

      Lot of stolen money looking for a yield.

      Real story is the early realisation of the smart people that the us dollar is going, temporarily but perhaps not, south, ie zero

    • I’ll tell you why:
      Because excess money is ruling markets right now. The relationship you think exists only exists when money is relatively scarce.
      Right now money is gushing from every hose. What financial asset isn’t appreciating right now?

  5. Quote from the age:
    The abattoir will close for at least 14 days. On Wednesday the Colac Otway Shire Council said it was struggling to find appropriate accommodation for people living in share houses who were required to isolate.

  6. Arthur Schopenhauer

    Melbourne traffic was pretty bad at 3:30 this afternoon. Lockdown 2.0 not as effective as 1.0.
    Mask wearing was 95% though.

  7. Have not really left the property this week but I drove around to the post office in our little local shopping centre here on the Mornington Peninsula this arvo. I can basically report 100% mask compliance with the rules. There was one teenage boy not wearing a mask, walking close to another teenage boy who was. They’d been dropped off from a school bus and were walking through a section of town where all the block are a minimum half acre (so not a high pop density). Everyone at the shopping centre was wearing a mask and I saw 2 other people wearing masks in their cars even though they were the only people in the car. So I’d guess they were only doing short trips and decided that wearing a mask all the time was easier, which is what I was doing. There was even a bloke wearing a mask while mowing the lawn on his nature strip. Our area is almost all old Aussie. Grabbing my parcel I was quite proud of everyone, relieved because finally protecting myself isn’t all on me and hopeful thinking that maybe Vic will get over this. I got into the car and started crying just a little. After living in China for nearly 2 decades I’m very comfortable wearing a mask, but there was just something so sad seeing a father and son walking out of the IGA wearing matching black masks, as well as little old white ladies hobbling along, the Indians who’ve just taken over the PO and the bogan mowing his lawn all wearing masks.

    • Basically, probably. Get your evidence and apply on the home affairs website for an exemption to travel, say you’ll be away long-term to make your living.

    • I have had 3 Interviews with 1 company, and supposed to hear back re: 4th, but I am sick of chasing them… So applied for a few more jobs yesterday. Heard back from 2, 1 was a bloody pyramid scheme. (I knew when applying it sounded too good to be true, it was 1 of those Multi-level marketing jobs called “Prosperity of life”), they wanted me to sit through some 2 hour webinar. I watched 5 mins and emailed back and said, no thanks.

      The other I have an interview for on Monday, I’m a bit over interviews at this stage. I seem to be getting good reply rates to applications, but things go quiet after a few interviews. I’ve heard a lot of people saying similar experiences at this stage. Seems a lot of companies are fishing but not committing to candidates. For me what is complicating matters is that our first child is due any day now, so part of me is thinking I should wait before continuing to apply for work..

        • Quite frustrating, because a couple of companies have got me to do homework in the form of knowledge tests etc.. and you invest several hours in this activity and don’t get paid for it.

          I had another person say I was over qualified for a job, but wanted my help with their SEO strategy so I put together a report for them (somewhat knowing I was going to be wasting my time), company says thanks so much for that. Proceeds to get quiet. Didn’t get paid for it either.. Despite investing several hours in a review of their website etc..

          • Shades of MessinaMEMBER

            Gav, why don’t you just set up a little consulting business for SEO ?.

            Plenty of on-line businesses doing well now with e-Commerce, so you would think there was a market for it ?.

          • To be honest I hate the SEO industry. I worked in it 10 years ago. But you’re competing with all the Indian SEO firms that promise the world for $50. And to you have to spend hours explaining to clients how it works and what’s reasonable to expect and that they need to put time and effort into their strategy.

            I find it incredibly repetitive and frustrating to advise clients. I had a lot more luck / joy doing it for my own hobby sites etc.. since I had control over everything and could implement things easily.

            I did the review for this company because I thought it may lead to more work or being an advisor for their online strategy.. I should have said sure I’ll do a review but I’ll charge $500 for it.

            It seems to be that employers take advantage of your time because you feel you have limited choice but to go along with it. But for me, no more. I will tell them upfront if you want something done, this is my hourly rate.

            I actually think they will respect your time then.

          • Pfh007.MEMBER

            “…. that they need to put time and effort into their strategy…..”

            That ain’t going to happen down under.

            Time AND effort.

            Deal breaker.

          • I have a mate who was made redundant recently – he was in sales (accounting software or something). He’s been offered a couple of jobs recently: both 100% commission-based.

      • ErmingtonPlumbingMEMBER

        “I seem to be getting good reply rates to applications, but things go quiet after a few interviews.“

        Maybe spend a little less time talking about how awesome Datsuns are at your next interview.
        You’ll Probably find yourself doing a lot better with “the ladies” to if you take on this advice.
        😘

      • (Note to self; watch out for old Datto with LOOSE WEIGHT NOW ASK ME HOW sticker on back)

      • BrentonMEMBER

        Yeah, I’d almost wait mate.

        There is no sleep deprivation quite like that first newborn.

        The first 2 weeks were some of the best days of my life….. the 2-8 week mark is easily some of the worst days of my life.

        Though securing a job in this climate might be huge for you, so what do I know.

        • Yeah and by the time I’ve adjusted lockdown may be over. I’ve sort of written this year off to be honest. Thank dog I squirreled away funds for a rainy day and didn’t over extend myself loan wise.

          I can ride things out a while longer. Just wish I had some money to invest in my hobbies..now I’ve got all this time I could be fixing / restoring my cars. But have decided not to spend a cent on anything that isn’t a bill or living expense.

          • A tough but wise decision. Knitting is my thing (can i even admit that on this blog?), kinda suitable for someonewith cfs, not a lot of energy involved, though I’m stuck at the difficult parts of a jumper (never knitted one before) because of trying to tech myself new stuff with brain fog is just not what I want to attempt right now. Anyway I’m not buying anymore yarn, which can be expensive, until I’ve knitted all the yarn I already own. Good luck with the arrival of the little one. I how all goes well and that you and your wife stay safe, happy and healthy

          • SnappedUpSavvyMEMBER

            Anything you can do part time or contract, even just labouring, get a grand a week for awhile

            Actually i forgot the baby, just help ya wife for 3 months

            What made it so hard for me in those first months was all the ‘experts’ telling us not to let the baby in your bed, but now I can tell you, if it’s refusing to go to sleep just sleep with it on the couch or bed instead of trying all fckn night to ‘put it down’

            Oh yeah and infants friend, stock up mate

          • @Snapped, I was helping a friend out in his workshop on a casual basis. But he’s 1 and 1/2 hour drive from me in Darnum Victoria. I’m in Warrandyte area. I didn’t mind doing it, but with missus nearly due. She didn’t want me to be far away incase she goes into labour.

            See it’s all Labor’s fault again!

          • Anybody who takes the p1ss out of Popcod’s knitting on MB should be prepared for Stern Looks.

            Have I mentioned my newly acquire juggling skills?

          • Thanks Popcod, I’m sure plenty of MBers are into Basket Weaving anyway. So they shouldn’t point fingers.

          • haroldusMEMBER

            Funnily enough (back to my childhood), two of my favourite crafts that I even took home and did out of school were macrame and basket weaving!

            I made macrame pot hangers for the entire house in whatever cheap wool mum could find, had tonnes of patterns. Basket weaving was harder to get the bases and cane, so did that at school mostly.

            Shut up ermo. Shut up all you cnvts.

          • @Harry I found the Swinburne article good.

            Also worth noting is that a significant body of research has confirmed what crafters have long known – that their crafts have mental health benefits. Craft has been found to enhance wellbeing – indeed some psychologists prescribe knitting for their patients.
            Crafts also promote social connections, a counter to the loneliness and social isolation of contemporary life. Even trauma can be eased by participating in them, researchers have found. “The analysis revealed that feelings of agony or pain could be pushed away and turned into bodily activity or symbolic imagery by hand work,” writes Finnish researcher Professor Sinikka Pollanen.

            My craft is my cars and metal work, welding and fabrication. Making things is satisfying. Much more than any of my IT jobs have been.

          • haroldusMEMBER

            I know what you’re saying gav.

            I’m quitting SQL and going macrame fulltime.

            Thanks for helping me make the decision.

          • I’m not responsible for this madness Harry, think of the kids! What will they eat… 😀

          • haroldusMEMBER

            Too late.

            I’ve already emailed the missus and explained about this guy on MB who has finally given me the courage to live my dream.

            The dream of macrame.

  8. yeborskyMEMBER

    I can confidently predict that, if things don’t change, they’ll stay much the same.

    • ErmingtonPlumbingMEMBER

      How did this get past the ABCs Commissars!?

      “While we skite about our “miracle economy” and 28 years of uninterrupted growth, a large part of that has been down to simply adding more people to the population. The bigger your population, the bigger your economy. So, adding people equals growth.

      In recent years, immigration has accounted for 64 per cent of our population growth and, according to a Federal Government study, by 2050 will contribute $1.6 trillion to GDP.

      The longer our borders stay closed, the more difficult it is to maintain the growth forecasts into the future.

      While immigration boosts the overall size and value of the economy, it doesn’t necessarily make everyone better off.

      In fact, it can make us worse off, as this graph from the Australian Bureau of Statistics shows”

      Did Ita authorise this “going rouge” !

      • Mining BoganMEMBER

        Maybe it’s just a case of being that desperate to sell immigration to the great unwashed the little nuances are lost.

        • ErmingtonPlumbingMEMBER

          Going rogue is of course what I meant.
          But red works to.

          I make no apologies for my shyte plumbers speeling

      • While immigration boosts the overall size and value of the economy, it doesn’t necessarily make everyone better off makes everybody worse off, ruins the environment, uses all the water, takes the entry level jobs our children might be doing, crushes wages, buggers our infrastructure, destroys our public health system, completely fcks our universities, corrupts our politicians, explodes our housing market into a giant ponzi of criminal money laundering, allows Monica Tzu of Black Diamondz to flourish that fcking germ, and overall destroys our society and civilisation.

        Apart from that, there are also some negative effects

        I thought that statement needed some fact checking.

      • Problem is ABC journos quasi parrot Macrobusiness – sans the brains. Frankly, don’t know how they hold a job.

    • ErmingtonPlumbingMEMBER

      Not if the Eskimos have a say on the matter!

      I thought Trumps Original “offer” to buy Greenland came after China suggested it might be interested in purchasing Territory there in the same way the United States Purchased Alaska from Russia.

      • I made fir bit of money on CHZ few times last year. Still have them on my watchlist but haven’t inspected their announcements to see how far they are with their discovery.

      • Which one, Cristian? Going on the posting rate of ROX on hc vs that of VMC then ROX will undoubtedly be a “ten bagger” and VMC will flatline (though personally I suspect there is a slightly negative corelation between share price and hc chatter).

        • Both Rox and Venus. Rox has 70% of the Youanmi Gold Mine area, where the new Grace discovery is doing really well. But they hold a 50/50 JV over a long stretch of the shear zone, so plenty of scope for further discoveries.

      • i only have 20 Oz so don’t really care. I hold them as emergency funds. No plan to sell at all unless I am buying a house outright so I don’t have any debt.

        • ErmingtonPlumbingMEMBER

          How many tins of Baked Beans (in ham sauce) per oz are you hoping for?

        • Lol I’m including miners

          Just wary of getting greedy and holding on too long

          US election could be the turning point maybe

          A United house/presidency and renewed globalist cooperation could do it

        • If you hang on long enough you may be able to buy a handful of houses with 20oz.

          Just hang on to them – leave em to yer kids etc. rainy day fund in the meanwhile.

  9. a house that was for sale 1.5 years ago and was taken off the market because owners couldn’t get the price they deserve was put up for sale back in March and now shows sold with.. price withhold.

      • don’t have one.. wife told me and I can see the sign on the street. too depressing to search RE sites for houses in Middleton Grange.

        • Call the agent, usually they will tell you a narrow range even if they are “not allowed” to disclose the exact price.

    • If the contract settles (which is by no means assured under present conditions), you will get the sale price from the NSW Valuer General site. Just need to wait 6 weeks.

  10. ErmingtonPlumbingMEMBER

    “The study, they said, shows that how microorganisms change and develop “may have an unrealized impact on greenhouse gas emission from marine methane reservoirs.”
    “Our results suggest that the accuracy of future global climate models may be improved by considering the time it will take for microbial communities to respond to novel methane input.”

    https://www.sciencealert.com/there-s-a-strange-methane-leak-from-antarctica-s-sea-floor-and-it-s-not-good-news

  11. New public health order tomorrow is going to reduce the NSW/VIC border zone from 50km to 2km. This thing is gonna blow up bigly.

      • Yes, sorry it was today. It was done very quietly. Not a lot of media around the announcement.

        My sources are through liaising with public health as part of my job. Most of the PHU’s around the state are pretty open. They are more flat out busy now because contact tracing is much harder when people aren’t locked down. The COVIDSAFE app is useless as well.

        Victoria have all but given up on contact tracing. NSW are still doing reasonably well with that but the consensus seems to be that this is a much more virulent emerging second wave.

        • The COVIDSAFE app is useless as well

          That can’t be right, Stuart Robert was in charge of it.

  12. Just watching William Dudley on bloomberg, apparently some members of the fed are concerned they have blown equities too high, and one of the incoming governor s (shelton) advocates for a return to the gold standard ???

    • Shelton pretends to want a return to a gold standard but she’s just hot air, frankly. She also thinks zero rates are the way forward but doesn’t see the contradiction in those two views. People who want a return to a gold standard generally also think the Fed should be dismantled, so …

      • “She also thinks zero rates are the way forward but doesn’t see the contradiction in those two views.” Quite bizarre really, i guess she will give up on it if she’s confirmed, maybe the PH of the Fed.

        • DominicMEMBER

          Greenspan was a hard money advocate right up until he was appointed Fed Chairman – then he embraced all things Keynes – then left the post and returned to hard money advocacy!

      • Agreed … in a deflationary event switching to a inherently deflationary monetary system is silly, but at least it highlights the agency behind the ad hoc nature of the system.