Houses and Holes

10

What are auction clearance rates telling us?

Via New Daily: The property industry is pointing to high auction clearance rates as evidence of a strong post-election recovery, but experienced analysts say the latest figures only tell half the story. Last week recorded the highest final clearance rate (61.8 per cent) since May last year, prompting those with skin in the game to

3

Is iron ore signal or bubble?

The FT has an interesting debate on it: The price of iron ore has surged 60 per cent to above $115 a tonne so far this year, according to S&P Global Platts…But it also runs the risk of attracting fresh supply and bringing this year’s rally to an abrupt end. “The market is telling us

8

Dominos back into the oven for wage theft

Back into the oven for the pizza giant, via the Herald Sun: Pizza giant Domino’s will on Tuesday be hit with a class action by workers who claim to have been underpaid for almost five years. The class action is being brought on behalf of delivery drivers and in-store workers employed across Domino’s franchise network.

22

Blundell-Wignall: Houses and holes are done

Not this Houses and Holes, who is flourishing. The houses and holes economy is cooked, says Adrian Blundell-Wignall, former director of the OECD, an adjunct professor at Sydney University and author of Globalisation and Finance at the Crossroads, via the AFR: “A plan” is not about government policy overreach exposed as flawed in the 1970s. A greater

7

Should we run infrastructure like the RBA?

So says the RBA: Dr Lowe also said major infrastructure funding should be run like monetary policy – at arm’s length from the government – so that voters trust it is fit for purpose. “If we don’t get it right then the public doesn’t trust the politicians,” he said at the Crawford leadership forum in Canberra

74

In Iran war, Straya has 23 days to lights out

This is the amusing joke, the idiot cousin if you will, that every Australian strategic analyst overlooks red faced, via Peter Hartcher: The leadership in Tehran repeatedly has said that if Iran is not allowed to export oil through the Persian Gulf, no one will. “Either everyone will export, or no one,” as Supreme Leader

16

More on Aussie QE

From Westpac this time: • As mentioned in our front page essay, last week’s RBA Board Minutes did nothing to silence the increasing market focus on the potential for the RBA to venture into more unconditional forms of monetary policy, such as quantitative easing. That is despite RBA Governor Lowe stating later in the week

0

Daily iron ore price update (steel save)

Iron spot prices eased back. Paper fell harder. Steel jumped higher. Reuters explains: China’s top steel city of Tangshan has imposed a new set of output restrictions on its iron and steel firms because of persistently high industrial gas pollution levels, the local government-backed Tangshan Labour Daily reported on Monday. Two units of steel giant

2

Australian dollar roars into the G20

DXY was soft again last night. EUR up and CNY down: The Australian dollar lifted against all DMs: And EMs: Gold broke out of its giant, bullish ascending triangle: Oil fell: Big miners rose: With metals: EM stocks were stalled: Junk stable: Treasuries were bid: And bunds: And local bonds: Stocks held on: Westpac has

14

Moody’s: No house price recovery until 2021

Via Moody’s: Second-Quarter 2019 Housing Forecast Report The May CoreLogic Hedonic Home Value Index results show the national housing market continuing its correction, led by Sydney and Melbourne. The national index for home values has fallen for almost two years. The decline has been sharper in house values compared with apartment values; house values have

15

Labor to support stages 1&2 of tax cuts

Via Albo: What we have determined this morning to do is to propose a negotiating position to the Government which would bring forward tax cuts faster for those who need it and importantly those who will spend it to stimulate demand in the economy.” We have determined the following position: Stage one – of course,

4

RBA recommends you buy shares

Via Damien Boey at Credit Suisse: The RBA has just released a paper about the history of the Australian equities. It contains some very useful and unique historical data on the Australian market. For context, earnings, dividends and total returns data for the Australian market has been quite sparse, and of questionable quality going back in

0

Santos lies again

Last week I noted the campaign to get Santos’ Narrabri gas project off the ground owing to its importance as a foil for the Centre Alliance push for gas reservation and, by extension, the ScoMo’s Government’s tax cuts. The AFR declared the project all but approved: Encouraging indications that the Narrabri gas project will go

4

Roubini: All out trade war inevitable

Via Nouriel Roubini: The nascent Sino-American cold war is the key source of uncertainty in today’s global economy. How the conflict plays out will affect consumer and asset markets of all kinds, as well as the trajectory of inflation, monetary policy, and fiscal conditions around the world. Escalation of the tensions between the world’s two

12

Businessomics sets about destroying ScoMo

Overreach. It’s always fun to watch. Via the AFR: Prime Minister Scott Morrison has vowed to slash government red tape to unlock investment and opened the door to industrial relations reform, challenging business to make the case for change and to deliver “shared gains” for workers and employers. In his first major domestic policy speech

44

Another idiotic ‘Boomer versus Millennial’ housing debate

The AFR’s war on rate cuts took a new an ever more stupid turn on the weekend: Baby Boomers and Millennials are trading blows about who is responsible for deteriorating economic conditions that weaken their chances of home ownership or retirement security. Millennials allege profligate Boomers got a free kick from no university fees and

22

Pentagon launches China containment plan

Via Peter Jennings at ASPI: The United States is rapidly restructuring its military presence in Asia and rethinking how it could fight a major conventional war in the area which the Pentagon has identified as the ‘single most consequential region for America’s future’. This will have important strategic consequences for Australia. The Indo-Pacific strategy report released this

34

Westpac: Australian dollar will fight the Fed to fall

Via Westpac: For the FOMC, “uncertainties” now dominate At the June meeting, the FOMC’s stance on monetary policy shifted materially. While their core view of the economy remains positive, “uncertainties” now dominate. Beginning with the core view, it clearly remains constructive. The only real economy forecast to see material revision in June was the 2019