Houses and Holes


Property investor sentiment crashes

Via Martin North today: DFA has released the final dimension from our household surveys to end November 2018, zeroing in on financial confidence. As is perhaps predicable, the overall index fell again, down to 87.8, well below the neutral setting, and close to the record low we measured in 2015. Property owning household segments continue


Scummo to leave Straya half-pregnant on Jerusalem

Via The Australian: The Morrison government is expect­ed to formally recognise Jerusalem as Israel’s legitimate capital following a cabinet meeting today, but may delay the ­relocation of Australia’s embassy from Tel Aviv. Senior government sources have confirmed a final decision was made by cabinet’s national securi­ty committee last night. It is believed the option favoured


What crashed the ASX?

The Australian says: Escalating China-US trade tensions pummelled the Australian sharemarket yesterday, pushing the local bourse to record its third $35 billion-plus wipe-out in as many months. The benchmark S&P/ASX 200 index took a 129-point, or 2.27 per cent, dive to 5552.5 points, its lowest level since December 2016 and just shy of a two-year


Goldman: Australian dollar to 75 cents

Via Goldman: AUD/USD has had a round trip since the G20 meeting last weekend, initially rallying on the US-China ‘truce’ before falling on weaker GDP data and perceived dovishness from the RBA Deputy Governor Debelle. In our view, Deputy Governor Debelle’s comment that although the next move is likely a hike “there is still scope


Stink! AFR throws haymaker at MB for RBA

Via Jonathon Shapiro at the AFR late yesterday: Housing bears are famous for hearing what they want to hear. And last week, Reserve Bank assistant governor Guy Debelle made it very easy when he dared to suggest that “quantitative easing” was a policy option. For the bears, who appear to be revelling in each set of weak auction


Mirabile dictu: Crikey discovers the income recession!

Mirabile dictu, Crikey’s Bernard Keane has finally discovered the real problem: …while much of the political and media class were obsessing about some asylum seekers last week, our understanding of the economy changed significantly in the wake of the September quarter GDP figures and the reaction of the Reserve Bank about where interest rates might


Dick Wakelin capitulates

Dick Wakelin capitulates today: Sydney and Melbourne prices are likely to drift downwards in the first three to six months. That forecast is based on continued lending tightness by the banks until the dust settles after the publication of the final royal commission report in February and a general skittishness of participants. The downward trajectory


Whyalla births green steel export powerhouse

Yes, you read that right, from The Australian: British billionaire industrialist Sanjeev Gupta, backed by heavyweight Chinese investors, plans to build one of the world’s largest steel plants in Whyalla, 380km north of Adelaide. Flanked by Scott Morrison, Bill Shorten and South Australian Premier Steven Marshall at this morning’s announcement, Mr Gupta said construction of


Goldman doves up on Fed, lifts AUD

And so it begins, from Goldman which has been far too hawkish this cycle all along: Relative to the turmoil in the financial markets, the economic numbers have been remarkably stable recently. Admittedly, jobless claims have risen and November payrolls fell somewhat short of expectations. But a report showing 155k new jobs and a decline


Why isn’t Chinese stimulus working?

Via Goldman: …two challenges brought us here. Internally, policymakers’ efforts to constrain the growth of shadow banking and reduce financial risks worked almost too well. Financial regulations introduced in 2017 and early 2018 led to a meaningful contraction in shadow banking, which slowed overall credit growth and tightened credit conditions, particularly for private companies. And externally,


RBA panic intensifies

From RBA boffin Christopher Kent today: Thank you for the opportunity to speak at this Bloomberg event today. I’d like to address some issues about how monetary policy decisions taken elsewhere influence interest rates here in Australia. Australia is a small open economy that is influenced by developments in the rest of the world. Financial


Energy lunacy marches on

Via the AFR: Energy producers and investors are regarding a possible Labor government after next year’s general election as offering the prospect of a defined energy policy that, while potentially tougher for the industry in some areas, will at least bring an end to what some have described as “almost uninvestable” situation under the Morrison


The Greens have literally gone mad

Here’s is what a green looks like: Here is what a Tampa green looks like: And here is what The Greens look like when you put them together: A NSW Greens MP has lashed out at the “destructive extreme left forces” in her party after members formally asked fellow MP Jeremy Buckingham to step down.


Can Huawei be contained?

Via FT: China has summoned the US ambassador in Beijing to demand the cancellation of an arrest warrant for Meng Wanzhou, chief financial officer of Chinese telecoms company Huawei, in the latest sign that her detention is souring relations between the two powers. Beijing also threatened Canada with “serious consequences” following the arrest of Ms


OECD: Australia must prepare for house price “hard landing”

From the OECD today: The latest OECD Economic Survey of Australia, to be released on Monday 10 December, assesses the continuing robust growth of the Australian economy, as well as the challenges to ensuring sustainable and more inclusive growth against a backdrop of globalization and technological change. The Survey discusses how Australian can limit financial sector risks,


Politico-housing complex implodes

It is a laugh a minute now for the politico-housing complex. First up the RBA, which “economists” say was actually bullish last week: Economists believe the market misinterpreted comments by Reserve Bank of Australia deputy governor Guy Debelle, whose speech on Thursday was received as dovish but in fact was “frank” and consistent in substance