Macro Afternoon

See the latest Australian dollar analysis here:

Macro Morning

Some more optimism returns to Asian share markets with the strong lead from the lone European bourses overnight, with S&P futures indicating a solid open on the return of US traders from their long weekend. Bitcoin remains depressed, just hanging on to the $10000 level while gold continues to hover just above weekly support at the $1930USD per ounce level:

In mainland China, the Shanghai Composite is up nearly 0.7% to be at 3312 points while in Hong Kong the Hang Seng Index has taken back its previous losses to be up 0.5% at 24713 points. Japanese stock markets are doing even better, with the Nikkei 225 finishing 0.8% higher at 23274 points but the USDJPY pair is going nowhere fast:

The ASX200 was the standout again, gaining more than 1% in anticipation of a solid open tonight on Wall Street, finishing at 6007 points while the Australian dollar has launched out of the gates this afternoon to almost pop through the 73 handle:

Eurostoxx and S&P futures are indicating a solid gain on the open tonight with the S&P500 four hourly chart indicating strong buying support at the 3400 point level as we all wait for the BTFD crowd to move in:

The economic calendar includes the latest German trade balance figures, the highly anticipated Eurozone Q3 GDP estimate, then a big series of US Treasury auctions to watch out for.

 

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Comments

    • +1.

      Had to laugh when I saw the Reuters article trying to cover this:

      An RBA spokeswoman directed a Reuters inquiry to APRA, which declined to comment.

      Representatives of Commonwealth Bank of Australia, Westpac Banking Corp and Australia and New Zealand Banking Group Ltd – the country’s largest, second largest and fourth largest lenders – were also not immediately available for comment.

      A spokesman for No. 3 lender National Australia Bank Ltd declined to comment.

      • Groan bank money is not public money, not that your framing is a complete concoction at start. Look before you can even go money crank you have to reconcile the political frame work that neoliberalism created out of whole cloth and how that effects the political sphere over the period in question and how that relates to government distinction.

        Your camp got its markets markets markets and now its an epic case of chutzpah …

        • pfh007.comMEMBER

          Snort.

          Nothing like some boiler plate marsupial deflection from its precious banks.

          Ok banker boy.

          Please explain why it is in the public interest to create interest accruing wealth assets for your banker mates to buy. $240 billion worth.

          Reconcile that!

          Yes, yes, we know.

          Banks are just inanimate tools manipulated by a conspiracy of people who have NO employment, shareholding, access to credit or any other interest in private banking.

          Head thunk chortle.

          • Personally I think Treasury should be issuing negative yielding perpetual bonds at the moment to finance their spending.
            ie. periodic interminable wealth tax on bond holders

          • The day you abandon its all banks fault due to your antiquarian plank in your eye a discussion might occur pft …

            I don’t fixate myopically on banks because there are more fundamental issues E.g. why would one focus on out put and not that which enabled or underpinned the egregiousness at onset.

            Then again your sort was blown away by the BOE memo … ignorance is not a solid foundation for veracity when opining … eh.

          • Sweeper,

            You could do that but why would you prefer that to just nationalising the banks? By nationalising the banks, which I understand is your preferred solution, it would not matter that they were stuffed to the gills with juicy Australian Government bonds paying interest as that interest would just be paid back to the government as dividends. Plus there would be the added bonus that all exercises of the credit allocation power would in effect be an expression of government public policy. Government policy to advance credit for productive purposes rather than asset price fluffing.

            Unfortunately, poor old Skippy would hate this extreme form of money crankery because it clearly displays an anti-bank fetish.

            By comparison I am very generous to the private banks.

            The MyRBA proposal is about getting our bankers out of their Smokey Dawson easy risers and get them nice and fit…….a bit like Patrick Bateman perhaps?

            https://www.youtube.com/watch?v=cISYzA36-ZY

            I am confident that once they lose their special “banker privileges” they will have little difficult giving all the non-bank lenders and capital managers a good run for their money.

            https://theglass-pyramid.com/2020/07/26/bank-watch-essential-bootcamp-equipment/

          • because banks aren’t the only entities holding government bonds.
            I have no objection to deposits at the RBA but I don’t see how you think it gets around the governments need to pay interest when the short term rate is positive. eg. RBA could buy all the bonds from the banks right now in exchange for bank reserves, but they still would have to pay interest on reserves. They already are paying interest on reserves now even though the 3 year yield is pinned at .25% which is a joke.

          • pfh007.comMEMBER

            Sweeper,

            “… I have no objection to deposits at the RBA but I don’t see how you think it gets around the governments need to pay interest when the short term rate is positive…”

            Why would the RBA be concerned to fix the short term rate when banks, non banks and the general public are permitted to open and operate deposit accounts at the RBA?

            $2.3 trillion worth of risk free assets (RBA deposits) that pay zero interest should exert plenty of downward pressure on rates for those wishing to borrow them from those who have them.

    • That is a business-related article. Coronavirus is one of the main subjects here.
      Suggest you head over to Virology Today for a full wrap of the implications of this new policy mandating bank buying of government bonds.

    • RBA is funding infrastructure stimulus indirectly via the banks?
      RBA prints money to lend to the banks, requires banks buy govt bonds with some of the money.
      Wow.

      • The RBA already has a facility which lends a certain amount (a percentage of total assets) to the banks at 0.25%. It is this lending that (conveniently) is now being directed toward purchasing Govt bonds.

        The Fed is directly monetising the US deficit — we’re not there (yet). Only a matter of time though.

    • Incidentally Westpac calls me to ask if there is anything they can do for me? Randomly today out of the blue. I guess they want to make sure my money stays in their bank? I dunno.. I should have asked if they can clarify their financial situation? LOL, but it’s just some grunt from the local branch, not a head honcho..

      • I banked with Westpac many, many years ago — and I had a similar call a few weeks back. I must still have an account open with them (probably has $5 in it).

        • I’ve done my best to move all my banking away from them. Except my short term money. Pay etc.. the mortgage and what not is with someone else.

          I’ve been woefully underwhelmed with Westpac over 25 years with them. From over charging on fees to silently dropping interest rates, and then the RC.

          But I’m not going to get into it with front line staff as I know her hands are tied and the feedback is likely to be ignored

    • It’s where the RBA is too coy to directly fund Govt stimulus and demands the regulator instruct banks to bolster their liquidity position by holding more ‘risk free’ securities — prudence, dear boy!

      To be fair, regulators in other jurisdictions get up to the same nonsense. In fact, insurance companies and pension funds are also (depending where you are) often required to hold a percentage of assets in domestic ‘risk free’ securities i.e. Gubbermint debt.

      How convenient is that? 😉

  1. NEW ZEALAND …

    185,000 workers expect to lose their jobs within next year, Stats NZ says … Susan Edmunds … Stuff NZ

    https://www.stuff.co.nz/business/300102198/185000-workers-expect-to-lose-their-jobs-within-next-year-stats-nz-says

    One in 14 workers expect to lose their jobs or businesses by mid next year, new data shows.

    A survey by Stats NZ in the June quarter found that 7 per cent of employed people felt there was a high or almost certain chance they would lose their jobs or businesses within the next year.

    That equated to 185,000 people.

    Another 18 per cent said there was a medium chance. … read more via hyperlink above …

    • Pretty tough job don’t you think.The cops would be as amped as the criminals.
      Have you ever done a job of a similar nature(ie one where you fear for your life).Very easy to be critical

      • The two police officer attending are CIT (Crisis Intervention Training) officers, and they expect a 13 year old boy with autism to obey orders and lie on the floor. That’s because their training consist of a 40 hours course.

        Two armed adult versus a 13 year old unarmed boy. Who should be the one fearing for their life?

        • You just don’t get it.Sure there may be some issue with training etc but I am sure these people are in a very difficult position one that you would have difficulty imagining

          • again to fast to critic.You dont know all the circumstances bar a couple.I am no sympathiser of the police believe me.However they perform a crucial role that is very stressful and at the very least deserve the benifit of the doubt until proven otherwise

          • RobotSenseiMEMBER

            Sure. But they shot a 13 year-old kid having a mental crisis, not an adult with a weapon. The mother even called stating he was having a crisis and was unarmed.
            They. Shot. An. Autistic. 13. Year. Old. Kid.

      • I might concur with you more if US society wasn’t already ride with police shooting and violence…

        The concession I do make, however, us that the cops are scared of all the guns… everywhere…all the time…in a society full of individuals psychotically obsessed with their wills (sure, everyone in the world is, but the US turns it up to 11…)…

    • There is s something really, really wrong with US policing.

      I’m afraid any suggestions about trying to fix it merely out you as a TDS-suffering anarchist trying to overthrow the rightfully elected Government.

        • Come on man, try harder

          You know that’s not what he meant

          It’s difficult to say there isn’t something seriously wrong though

        • its ok Coming … they have a profit model now and confiscate property to fund themselves … not to mention some MIC second hand gear …

          • Absolutely devastating observation. They don’t get back up after walking into a shot like that. (edit: I’m talking about Maun’s comment – your’s was good too swampy)

    • Goes back to Gun laws in the US. If they had similar gun laws to Australia they wouldn’t assume everyone is carrying a weapon. Therefore they would be less trigger happy.

      I recall riding around Pennsylvania with my mum’s cousin who was a Police officer in Harrisburg for all his life (now retired). I asked if I’m pulled over in the US, should I stay in the car? He said absolutely. Do not attempt to open the car door, just put your hands on the steering wheel so they are visible.

      All things you don’t really think about in Australia when pulled over.

      • Shooting people in the back is not a fear based anything, the police in America was militarized decades ago.

      • Yep. Guns. Everywhere. All. The. Time. And wilfullness everywhere…all. The. time.

        They actually do kind of well keeping their society as functional as it is, though I think that is changing.

      • Yep, way too many guns makes people a little nervous – both cops and the bad guys.

        But I was a little shocked to read that in Sydney alone there have been 30 shootings in the last month alone — not sure that it’s normal and certainly sounds a little high for a country with supposedly strict gun laws.

    • Lack Of Universal Basic Income Causes 80% Of Crime In America

      June 13, 2019

      A new study looks into Alaska’s Permanent Fund Dividend and suggests that it reduced property crimes.

          • Nah, giving everyone a baseline living standard doesn’t mean they won’t work or want to better themselves. Those who are motivated to do so, will. In fact I think we would see less BS jobs and more innovation and exciting developments in society if we had it.

          • RobotSenseiMEMBER

            I was offering every knee-jerk argument against UBI. The thing with these scenarios is every muppet with three neurons will offer you a list of reasons as to why it either will or won’t work.
            And the worst thing we could do is… at least try it and see what happens?

          • I believe Alaska has a form of UBI. Basically it’s compensation for having to live in that climate and it seems to work ok? With the news of David Graeber’s death, I watched an interview where he was talking about it. If we want decentralisation that’s 1 way for it to work. Imagine if JobSeeker/Keeper (at the current Covid levels) was used to encourage people to move to specific regions of Australia for example?

          • but socialism tho

            Appreciate this is sarcasm but when people roll out this conservative jump-scare for reals the real irony is that a UBI (at least in its most common forms) is about as far away from actual “socialism” as you get.

          • My mum’s cousins live in Pennsylvania and they are full on Trump supporters.

            On my father’s side his aunt and cousins live in Kentucky and are much more Liberal and anti guns etc..

            It’s interesting visiting them both and having political discussions. There is some things I really like about the US and other things I’m glad we don’t have here.

        • 100% agree that petty crime would drop if people’s most basic needs could be met via UBI.

          As they would with liveable social security payments.

  2. just got back from my walk and spotted new For Lease listing. Volumes still extremely low – in terms of For Sale or For Lease signs.

    Anyway, NASDAQ starts to look ugly again and I think DOW is catching up.

      • Did that include:
        – stamp duty
        – loss o. Income from no tenants
        – selling costs
        – rates
        – insurances
        ??
        How much did the prick negative gear?

      • “The 1970s Hillman home, bought for $332,000 from its Keystart mortgagees in 2006, just sold for $250,000. That’s an $82,000 loss after 14 years, going backwards $5850 a year, plus the interest costs on its Westpac loan.

        As well as taking a hit on the price, Cormann’s investment spent 447 days with the for-sale sign up — it first listed in May last year seeking offers in the high $400,000s.

        It may be that the HomeBuilder stimulus grants kicked in to assist the deeply troubled Perth market, as the sales brochures emphasised the 1000sq m holding had the potential to build a duplex.

        Cormann, who lives at Applecross in a resort-style abode with wife Hayley, did double their money at Menora when selling for $950,000 in 2007, having paid $450,000 in 2003.”

    • I’m no fan of Trump but I hope he wins just so I can witness another wokester meltdown – a joyous sight if ever there was.

    • Woke BS from a poisonous, authoritarian, globalist institution which should die a quick death for all our sakes.

    • If Oil falls and stays below $35:
      Saudis will be in lot of trouble due to their budget and war in Yemen. From memory if oil is below $40 they will have to cut their spending but if they do that there will be riots and most likely regime change.
      Shale producers will have to shut – most of them that is.
      Russia will be hurting but not as much as many think.

      • They will just run up the tab like everyone else. Just no demand for oil. Cass freight no good. Baltic dry heading down and we all know whats happened to air traffic.

  3. With Trump now publically calling out the military-industrial complex, I’m waiting for the Democrats and the TDS brigade to express their solidarity with Raytheon Eric prince et al

    Maybe Smithy and skippy can praise them for their employment of blacks

  4. https://www.dailymail.co.uk/news/article-8708331/Victorias-chief-health-officer-admits-DIDNT-advise-Dan-Andrews-bring-curfew.html

    Victoria’s chief health officer has revealed he did not recommend Melbourne’s crippling curfew but premier Daniel Andrews imposed it anyway.
    Professor Brett Sutton today revealed the curfew was not requested by medical experts but was brought in as the government declared a state of disaster on August 2, on the advice of the emergency management commissioner.

    Every one of these clowns is trying to distance themselves from this unfolding human rights disaster

    • Asked for his view on the curfew, Professor Sutton said: ‘I haven’t reflected on it, I think it has been useful. If I put my mind to it.’

      Yep it really sounds like Sutton is dead against the curfew.
      Why does journalism keep running this story that Sutton has had a falling out with Dan Andrews? These great thinkers are considered essential workers so they get to move about, go to press conferences, ignore all the data, detail, not ask a single useful, informative question, then go home and after a period of deep thought conclude all by themselves that their essential task is to pretend Sutton doesn’t get along with Dan Andrews. Just as well they are considered essential.

      • He knew its meaningless from a public health policy point of view, like we’ve been saying you dullard.

        • The curfew was to stop late night partying. Remember the kids in Dandenong caught at KFC ordering for 30+ people when the Ambos were there? That’s why it was implemented. Yeah it sucks, but we needed a big dumb rule to get the numbers down. Now we are getting down closer to 0 digits and everyone wants to claim what a failure it’s all been? Well at least that’s the Sky News perspective.

          • There’s no science behind locking up Gavin!!! FFS so over you people moving the goal posts and claiming victory. The numbers are down because it’s been 7 weeks, that’s just how long it’s taken to go through everywhere. FU and your braindead kowtowing

          • @migtronix Yes, every other major city peaked at 750 cases per day and declined from there…/sarc What planet are you on? Clearly the intervention of a lockdown did bring numbers down. The only complaint at the moment seems to be that it hasn’t happened fast enough therefore we should open up? Sounds like the argument from cabin fever, which is fair enough. Also yes, some of these measures aren’t medical advice. But in order to practically implement what is required on the medical advice additional measures had to be taken. It sucks, but it is working. P.s places it ripped through had 100s of deaths per day. How can you possible downplay the significance of the impacts this has had in many cities around the world, and is continuing to do so.

      • A number of journalists including Virgina Trioli, Jon Faine and Malcolm Farr have confirmed that Newscorp journalists are being backgrounded and fed questions by the Prime Minister’s Office in order to undermine Dan Andrews. An hot mic at an Anna Palaszczuk press conference also confirmed this. It just shows that Morrison is only interested in playing politics while the country suffers.

        Piles of manure were dumped outside a couple of Newscorp offices over the weekend – I expect more to continue as people realise the media has essentially become an arm of government.

        • RobotSenseiMEMBER

          It’s no secret that it’s war between Andrews and Morrison right now. Feds are staring down a black hole of JobKeeper/Seeker payments to millions of Victorians and want someone to blame for the economic mess. Of course they are unable to blame themselves for creating an economy that is the equivalent of a 70 year-old smoker with heart failure and diabetes, but Andrews gave them Covid!

        • It’s journalism doing the back-grounding. The attack started with journalists and then worked its way up to Frydenberg, Hunt ScoMo etc (the official arm of government).exactly as happened before the election – journalism invented all of the LNP lines, election strategy etc. then the official arm just had to echo it.

          • That’s an interesting take on things. As Morrison has prior form on leaking to journalists to destroy rivals (Google Michael Towke), it seems more plausible that he’s the one pulling the strings to avoid getting his hands dirty and allows him to carry on his “Daggy Dad” persona. The Liberals are not the sharpest tools in the shed, with chaps like Tim Smith tweeting questions that reporters were found to be using in morning press conferences.

        • Yep typical ScoMo and Sky News commentators are doing everything they can to undermine a Labor government. They are scum.

        • It’s pure politics, always has been. I mean the lectures on contact tracing at the moment from the PM that said we just need to download the app and get on with life. If contact tracing is critical surely that should have been a check before a state could open up? The feds have been MIA other than giving back the money they tax, no policy, guidance or plans. Still nothing other than taking the tax takings back again….We’ve got a bunch of bean counters with no idea what a policy looks like other than what sounds catchy on a headline or tests well in a focus group.

          • Haywood JablomyMEMBER

            The same PM who conveniently ignores the fact that he could have shown some real leadership from the get go and locked the entire country (island) down, even if only until we got a handle on how we were going to deal with the virus. Had he done that, and done something useful about quarantine and aged care facilities, it’s unlikely he’d have anything to blame Andrews for in the first place.

            Bottom line is the entire sh!tshow can be laid at the feet of a blustering arrogant PM who has done little beyond spraying around poorly targeted money that isn’t his, and directing blame at everyone other than the one and only person who had a fighting chance of preventing it all.

            Unfortunately people tend to have short memories, and history will likely be much kinder to him than he deserves.

          • Yes, how many cases has the Covid Safe app helped us track again? 0? Last time I heard, haha. but it’s Victoria’s fault they aren’t doing a good enough job!

    • It’s probably a fraction of the size it was back in the day – a veritable corner shop, by comparison. 😉

      The filthy rich own Amazon these days, don’t you know. Bottoms up!

    • Hopefully “gender reveal” goes the way of “choreographed wedding dance” real soon.
      Everyone thinks they’re a star.

    • Every rose has its thorn
      Just like every night has its dawn
      Just like every cowboy sings his sad, sad song
      Every rose has its thorn

      Goodnight everybody. God bless ‘merica.

    • This correction won’t amount to much — the nominal bull market is still intact. 10-20% max. Then off to the races again.

      The Fed won’t let this go too far.

      But most of the Robinhooders will get their ar$es handed to them – as they should.

      • Yes, this has and continues to be true every dip until one day it isn’t. But who knows when that will be.

      • if 1% want Trump to lose markets will be in decline all the way to the elections in order to make sure maximum number of people feel the pain – some from going broke due to margin calls and falling shares in general and some from job loses that will be triggered right before the elections.

      • Nasdaq down 3%, S&P500 2.5% down. Testing lasts session intra session lows, interesting. Tesla down 18% on open.