Macro Afternoon

See the latest Australian dollar analysis here:

Macro Morning

 

Markets have started the week here in a generally positive fashion across Asia, despite a mixed and flat lead on Wall Street on Friday night, with Japanese stocks leading the way, while the local ASX200 is trying to breakout again.  Currency markets are very flat while gold can’t seem to gain any traction in Asian trade, coming up against staunch resistance at the $1950USD per ounce level:

In mainland China, the Shanghai Composite was up nearly 1% but is now close to put in another scratch session, currently up only 0.1% at 3263 points while in Hong Kong the Hang Seng Index is bouncing back, up 0.6% to 24659 points. Japanese stock markets were the best performers again with the Nikkei 225 rising nearly 0.7% to 23556 points while the USDJPY pair is slowly deflating as it threatens to break below the 106 handle:

The ASX200 closed nearly 0.7% higher at one point shy of 5900 points, led by commodity stocks as BHP and Fortescue both put on around 2% while the Australian dollar continues to hold on a steady course of going nowhere, still stuck at last week’s point of control at the 72.80 level against USD:

Eurostoxx futures are following the Asia lead, up 0.6% while S&P futures are slowly rising off the floor, with the S&P500 four hourly chart indicating a potential bottom at the 3300 point level that could firm into a bounce late tonight – watch 3420 as the key resistance level to beat:

The economic calendar is relatively quiet tonight with EZ wide industrial production estimates and US consumer inflation expectations the only tertiary prints of note.

Latest posts by Chris Becker (see all)

Comments

  1. boomengineeringMEMBER

    I hear all the rich people are leaving NYC.
    That could make a good conspiracy theory same as some selected told to leave World Trade Center before the event.

    • SnappedUpSavvyMEMBER

      lots of rich people leaving sydney too, for southern highlands and byron bay etc

      i was in the city on sunday and wow is it quiet, i don’t know how any shops in the QVB will survive with all that expensive stock

      • Tbh – I never knew how they did BEFORE the covid crisis.

        Southern Highlands will get a good kick along now … and then doldrums when everything is back to normal.

        Liquidity is a consideration with some of these tree change locations. If you are in a hurry you can sell a Paddo terrace any weekend without the need to discount – there are always buyers, indeed just look at how much turnover in any decent Sydney suburb.
        Southern Highlands on the other hand? Takes years to sell in any normal market as is the case with nearly any holiday market unless you want to “give it away”.

        Same as with stocks. Liquidity has value.

      • boomengineeringMEMBER

        SUS
        Yep the exodus is making Sydney more livable and in fact cheaper living expenses than regional if no rent or mortgage to pay and even that gap is closing.
        Perth became more livable after the mining boom ended.

        • Shhh Boom don’t say it out loud or you’ll jinx it……..I can feel the Nth Beaches getting back to the good old days – the more people that leave the better IMO

        • Agreed.

          Everyone talking about VICs heading to SEQ, the smart vics will head west as its got less humidity (zero) and is religiously aligned (aussie rules).

        • Problem is Boom, you’re left with all the dross who can’t afford to move. A farcken crime-wave in the making. Less wealthy people around in that instance is a problem – especially if you’re one of the people still around 😉

  2. Biden's teleprompterMEMBER

    Remenber the story about the BLM donations just happened to pay for my users tilt at the top job? Wellie, if I could go one up on that I would do something like this.
    http://www.antifa.com
    Please click and donate. It will help my owner purchase more meds and adult diapers. Don’t worry about offshore donation legalities, joe has people to look after that side.cough hunter cough

  3. NEW ZEALAND: MIGRATION REALITIES …

    … What is driving the sudden reckless and risky burst of housing inflation ? …

    New Zealand experiences negative population growth from migration for the first time in seven years … Greg Ninness … Interest Co NZ

    https://www.interest.co.nz/property/107037/july-country-had-negative-population-growth-migration-first-time-7-years

    Population growth from migration has almost come to a standstill since April and turned negative for the first time in seven years in July.

    The latest Statistics NZ figures show that the monthly net migration gain (long term arrivals minus long term departures) surged in the first three months of this year, hitting a record 12,976 in the month of February.

    It then dropped sharply to 9671 when the Level 4 lockdown restrictions were applied in March, and almost came to a complete standstill in April when the net migration gain dropped to just 88.

    It picked up slightly to a net gain of 347 in May, stayed at about that level at 341 in June, then dipped to a net loss of -26 in July.

    That was the first time that the country has had a net population loss from migration since May 2013.

    The latest figures have also dashed suggestions that the number of New Zealanders returning home during the COVID pandemic would prop up demand for housing. … read more via hyperlink above …

    • yeah but he is calling the end of politics and economic policy as we’ve known it for a generation too

      “As you know, a lot of young people now who actually become that cohort, the tax paying cohort, many of them have low incomes, they’re renters, they start life with a HECS debt if they’ve been to university and of course they pay the GST 10 per cent cold, regardless of income,” Mr Keating said.’

      What he is actually saying is that, inter alia, education, superannuation, employment, and our current taxation settings (let alone families and housing) probably dont make all that much sense for a lot of younger Australians

          • ErmingtonPlumbingMEMBER

            Using the family home to pay for Age care services through “Reverse mortgages”
            The Lower middle class, working class and the Poor will clearly be the losers in this. Typical Keating neoliberal destruction of the welfare state and working class standards of living. Now he is predictably calling for the Middle class to be kicked to the curb via the Privatisation of everything as well.
            He is a 100% sellout and sycophant stooge of global corporate Plutocracy.
            Cnvt of a Bloke

        • Sorry dude, I know you and I have radically different views on the man and I dont particularly have much truck with the HECS aged care proposal for reasons you and others quite rightly identify (though would it be worse than what we have?) but when a former PM comes out with…..

          “As you know, a lot of young people now who actually become that cohort, the tax paying cohort, many of them have low incomes, they’re renters, they start life with a HECS debt if they’ve been to university and of course they pay the GST 10 per cent cold, regardless of income,” Mr Keating said.’

          He is saying that the younger people of the nation he was once PM of, and whom the budget will rely on, arent going to go within a bulls roar of meeting the demands upon them.

          When he says that, he is saying Australian economic policy – which has essentially been bipartisan for a generation – has failed.

          As someone with kids aged 14 and 7 he is saying to me (who would possibly be easier on him than someone like, for example, you) that it is time to start looking about at what may open up a better life for them elsewhere. And when he says that he is saying to Australian politics (and politicians – both sides) it is either time to change the narrative and the outcomes it delivers, or Australia will end up a giant aged care facility in the South Pacific, where talent and ability seeks to depart.

          • what choice do they have? tax isn’t voluntary.
            The question is the extent of the burden you are going to place on them.
            Like the sale of CBA for $5-$9 p/s -30 years of dividends later and a share price of $66 – what a great deal for taxpayers!
            or dividend imputation gift to wealthy shareholders Cut to the the top marginal rate from 60% to 49%.
            Privatized pensions costing $36B a year in fees on workers would be wages which are taxed at a flat rate. This goes on and on and on.

    • Arthur Schopenhauer

      I think he is saying a lot of young people have lost faith in the old people that set the current system up and in politics more generally. He hasn’t joined the dots, because he’d have to look at one of the deadshts that designed the system in the mirror every morning.

      He’ll be telling anyone who will listen how great he is, well beyond the grave.

    • Totes BeWokeMEMBER

      Absolutely make estates repay care (AND PENSION) interest free, but absolutely not in a private system where access to funds will drive up prices.

      Just like housing.

        • they are going to need to get their a into gear
          cos the transiency of current wealth has a sunset, I say about this time next year.
          After that, those who are going to survive will be the industrial equivalent
          of the hunter gatherer.
          Back to real basics

          • Totes BeWokeMEMBER

            I’ve thought we were doomed for decades and now it seems to be unfolding.

            I want to be at the head of the riots demanding people like Labor, Greens, LNP, MSM executives and journalists are the first to lose all their wealth.

        • Totes BeWokeMEMBER

          Yes. Isn’t it interesting Labor went to the election attacking NG and franking, but ignored trusts?

          Small fry, but more so a different demographic, compared to trusts.

    • But National Seniors Australia chief executive John McCallum said it would be a difficult sell to consumers, particularly because people did not view their homes as assets and wanted something to pass onto their children.

      FFS

    • I saw that. Crazy.
      What seems to be suggested is an unsecured loan to all residents regardless of assets, all of whom have no current and future income earning potential.
      HECS, creates it’s own security being the income earning power of the student which is created by the education.
      eg. PV of future tax receipts > HECS loans to the Commonwealth – at least in theory
      A loan to a full or even part pension resident, will not be repaid from the Estate
      A loan to a resident with assets may be fully repaid, or may not be. They would all obviously have unknown terms so would be impossible to price, and repayment presumably would only be triggered when probate is released and would depend on the executor realizing assets at some point.

      Crazy. And this is how it has always been. He says something, which journalism jumps all over. Nobody looks at the detail.
      Then 30 years later it blows up exactly like super.
      And why is funding a problem in the first place? Because people have inadequate retirement savings exactly because the pension system was privatized, and the main asset is exempt from the pension and aged care means tests.
      It’s solving one brain fart with another. But journalism jumps all over it as usual.

    • Yes, clearly Keating’s neoliberal boner, undaunted by his age, is ready to roger the middle-classes even more.

      Meanwhile the ALP sits on the couch with a camera and an awkward smile live-streaming to a drunken party at Liberals HQ.

    • So much of this stuff is just a gimmick to create yet another “market” for the finance sector.
      Why create another HECS scheme?
      Remember Abbott wanted to securitise HECS. And who would be the buyers? Super funds
      But with such unknown terms you would either need to sell it for cents on the dollar or provide guarantees.
      A great deal for the private sector.
      And what does the government get? Cash. The only entity in the country who doesn’t need cash, when it can borrow for 3 years (pinned down by the RBA) at .25%.
      When alternatively instead of all this financial engineering they could just tax the rich and finance their own assets.
      Why can’t people see through this stuff

      • ErmingtonPlumbingMEMBER

        Because like calls for greater democracy, sober Economic Analysis like yours is never heard on our establishment media. “Left” or Right leaning.

    • There is merit in using unearned windfalls such as house price increases to “pay” for reasonable care expenses for an old person.
      The alternative is to allow the unearned windfall to be passed on to heirs.

      Having said that, the fact that Paul Keating is behind the idea bothers me enormously. That vile snake doesn’t have a good bone in his body. I’m wondering who is pulling his strings this time and why?

      Possibly aged-care elites have hired Keating to make the suggestion so that they can rort the govt like that govt-funded training scheme was rorted. As soon as govt provides loans to pay for something, shysters are able to move in and rort the loan system. Keating is probably fronting for the shysters on this matter.

      If the system was implemented a few years later you would find billions of dollars had been lent to poor people to pay for grossly overpriced care, and you would find Keating’s cronies making millions out of it.

  4. Americans are a lost cause. The idiots who support Trump are actually applauding when he says “nobody loves the military more than me”.

    He’s a draft dodging piss ant…

        • Yep, Tulsi appeared almost, er, normal. And thoroughly sensible.

          Definitely not cut out for a career in politics. The Deep State wants donkeys like Biden who they can control. The Tulsi’s of the world are way too dangerous.

      • he wanted to take them out of Syria but was forced to keep few around the oil fields for someone to continue looting and causing trouble but Olaf will tell you they are there to spread democracy.

          • ok, I take that back then. You had a go at me in the past every time I claimed Putin is better than many western leaders. I still think he is. I am not saying I prefer same system here but fact is Putin saved Russia from turning into 3rd world country and becoming US province.
            Russia now is self sufficient and I wish we have as strong manufacturing as they have. Yeah, they have plenty corruption but who doesn’t? I doubt we are far behind if anything I’d say we are getting worse. Look at the looting that takes place here. JK is being looted by everyone and publicly listed companies are not even hiding it. They report higher dividends due to JK. wtf??
            Water rights sold for non existing water, a port sold and then same politician taking a job at the company he sold the port to – just 9 months later and the list goes on.
            But yeah, let’s be worry about Putin.
            As I said many times before, let’s first clean our own backyard then we can worry about Russian corruption.

          • Putin is smarter than just about every Western leader I can think of — not that the bar is particularly high. There is a conga line of dense fcks, particularly leading the Anglophone countries, right now.

            What annoys me is the insistence that Russia is a major ‘threat’ to the West, somehow, when anyone with more than a peanut for a brain can see that Russia is nothing of the sort. Their military is a shadow of what it once was and their nuclear arsenal is rusting away as we speak, while the economy is going in the right direction but at a glacial pace. Putin is concerned only with supporting traditional allies in the region (Syria, for example) and preventing the encroachment of NATO on the Russian border. Those who claim he has Imperialist ambitions are brain dead – the IQ of an ice block. US commentators who claim this are either stupid or they are feeding an agenda – look a distraction! And, “Congress should give the military more money to fight this ‘threat’.”

            Putin is a hard, no BS mofo, because that is what Russia requires right now to keep things stable. There is nothing more to Russia than that.

      • LOL. Avoided war with North Korea like every new president for the last thirty years, after coming closer than any of them ?

        That certainly deserves a cookie !

        The bloke’s a walking broken window fallacy.

    • happy valleyMEMBER

      Just finished reading a great book “Dark Towers” (by David Enrich, Finance Editor for The New York Times) published this year on Deutsche Bank covering its massive derivatives exposures and its “experiences” lending to The Donald – fascinating.

      • Yep, DB were virtually lawless for a while — now the new regime are having to work to reduce the balance sheet (read: derivatives exposure) and the company’s results have suffered for year after year as a result. And there are several more years of this to go.

        • happy valleyMEMBER

          And at one point, DB apparently had the largest by asset value balance sheet of any bank in the world at US$2 trillion – with 45% of that amount being derivatives (probably understated as to notional value, but grossly overvalued as to real value). Now, those sort of figures (probably 3% of world annual GDP, for this bank alone) for derivatives really belie the meaning to Warren Buffett’s description in 2011 (?) of derivatives as being “financial weapons of mass destruction”?

          • It depends how you measure these things, of course (net vs gross etc) but at its peak the gross derivatives position of DB was estimated to be well north of $70 trillion (the collective global banking system exposure over $1quadrillion). Net is only relevant in so long as you can collect from your counterparty. For example, Goldman Sachs had $20 or 30 billion of ‘profit’ on trades they did with AIF FP during the GFC. However, if AIG had been allowed to fail, how much of that ‘profit’ would Goldman have collected?

            Said otherwise, would Goldman still be alive today?

  5. Who are,,, 414,430 with deferred home loans ($167 billion @1August) gunna call
    Ghost Busters??
    “One month after, three months after, the letters will get more severe”

  6. or.. forgot to include in my yesterday’s report..

    the van and the jeep are for sale now and the jeep is not 2 years old but 2012 model – if anyone remembers this from a week ago..
    also, yesterday I am sure I spotted RE agent visiting one of the houses so I keep an eye on it if they put a sign in the coming days. must have been RE agent – 20 something hot chick driving merc, holding a folder making a visit and high pitch “haiii” greeting.

    • The number of shark attacks (or sharks coming close into shore) on the East Coast is increasing, as far as I can see. We’re over-fishing the ocean so it kind of makes sense. The number of predators needs to be kept aligned with the amount of food – otherwise humans become legitimate targets for apex predators. Simplistic logic but appears thoroughly reasonable in the circumstances. Apex predators are apex predators for a reason – they survived when other species didn’t.

      Orcas, meanwhile, are smart animals – they know where the fish is!

    • Either one of their pod has been hit by a boat and they are exacting revenge or they have worked out that their territory is being overfished so they are disabling the competition. Definitely not happy.

Leave a reply

You must be logged in to post a comment. Log in now