Houses and Holes

55

Captain Glenn warns dollar, Sydney speculators

Captain Glenn Stevens is back in a speech this afternoon and has made very clear warnings to both currency and Sydney property speculators to back off. Of course this is entirely contradictory in any actual policy action sense, given addressing one can only benefit the other, which is why the jawbone is being rolled out in

2

Asia vulnerable to oil shock, Australia not

From RBS today: Asia is most vulnerable to an oil price spike Geopolitical tensions and continued supply outages in the  Middle East prompted a spike in Brent oil to  USD115.71/bbl in June, a nine-month high. Half of the  world’s oil is consumed in Asia (including Australasia). Furthermore, Asia consumes 76% of the Middle East’s oil

7

Chinese local governments wish for stimulus

Cross-posted from Investing in Chinese Stocks. Ifeng reports an unofficial and informal count by Chinese media puts recently added mini-stimulus projects at ¥10 trillion. Now if only they could sell some land or borrow to pay for it. Data puts local government investment projects at ¥14.7 trillion through May, an increase of 17.6% yoy, the slowest

39

The FED endorses macroprudential

The dills abroad are humiliating themselves again as overnight the world’s most powerful central banker endorsed macroprudential tools for dealing with specific financial stability risks. It’s different here, of course. We have the powerful talisman of Luci Ellis’s stick figures to keep our financial system stable and it will be immensely gratifying to watch the world’s

1

US jobs rebound stalls Australian dollar

The mini reprieve for the Australian dollar that started with the tanking trade deficit yesterday (down to 94.6 again) continued overnight as the US ADP jobs report (a private sector report that leads the official report tonight) jumped to its highest level in two years: Private sector employment increased by 281,000 jobs from May to

28

Algos replace business journos

From Paul Wallbank at BS: Yesterday, the Associated Press announced it was replacing business journalists with computer programs, following sports reporting where algorithms have delivering match reports for some years. Some cynical media industry commentators would argue rewriting PR releases or other people’s stories — the model of many new media organisations — is something that should

3

Europe’s creditless recovery stumbles on

From Westpac’s excellent Elliot Clark: Over the past year, a modest, patchy uptrend in consumer demand has begun to take shape in the Euro Area, with consumption growth up 0.4%yr in March. Following almost two straight years of decline, this growth could either be seen as a burst of pent-up demand which will prove fleeting,

13

Stiglitz, McKibbin clash on US failure

From the AFR, at a conference today Jo Stiglitz, …listed as weaknesses the US’s poor educational performance, financial deregulation, a slump in work-force participation, an economy that “socialises losses and privatises gains” and several decades of wage stagnation for low income earners. …“You have to say that’s a failed ­economic model.” Warwick McKibbin wouldn’t have a bar

35

Why have online retail sales flatlined?

I’m really quite curious about what is happening in Australia’s supposedly tearaway growth sector, online retail. Growth has literally crashed in the past twelve months and shows little sign of bouncing back. From NAB today: In the 12 months to May 2014, Australians spent $15.3 billion on online retail. This level is equivalent to 6.6%

11

Citi: China to slow to 5-6%

From Citi after a recent China tour: …We left with the impression that China’s GDP growth could gradually approach a new steady state of 5-6% after the transition. …Near-term growth risk and possible policy instruments – Chinese authorities are quite keen to defend 7.5% growth this year and the government’s inclination to emphasize its growth

27

Dad’s Army to the rescue on Australian dollar

Dad’s Army has arrived with its too-late-the-hero theatrics to save us from the rampant Australian dollar. Alan Kohler opines today on the long monetary hold: This extraordinary state of affairs rather belies the tranquil commentary in the Reserve Bank’s monetary policy statements, including yesterday’s. In fact the monthly bleat about the exchange rate after every meeting is beginning

0

China steel PMI rebounds

The June China steel PMI is out and supports notions of modest rebound up 1.9% month on month to 48.3 percent in June. The production sub-index for the sector stood at 48.9 percent, up 3.5 percentage points from May; new orders rose 4.9 percentage points month on month to 50.7 percent. The major driver of growth

54

Tony Abbott’s carbon war shifts to renewables

Prime Minister Tony Abbott is determined to rid Australia of all carbon mitigation it seems. From the AFR: Tony Abbott has sparked a war with the renewable energy sector by claiming their product was driving up power prices “very significantly” and fostering Australia’s reputation as “the unaffordable energy capital of the world”. …The attacks came

6

75k mining jobs to disappear

ANZ is making waves today with its latest major mining report. From Business Spectator: As many as 75,000 resource-related jobs will be lost in the next couple of years as the industry’s $450 billion investment splurge on new capacity winds down, according to research by ANZ. The toll on job numbers in the industry, as

4

Bill Evans on the RBA

Fresh from our Bill: As expected, the Board of the Reserve Bank decided to leave the cash rate unchanged at 2.50%. The Governor’s statement is almost identical to the statement which he released following the June Board meeting. The major change in markets since the June Board meeting has been the further lift in the

36

The Libs betrayal of carbon markets

From the AFR’s John Kehoe: Former US Treasury secretary Hank Paulson, a long-time Republican who served in the Nixon and Bush jnr administrations, likened the emerging climate change “bubble” to the financial risks that built up under his watch before the 2008 crisis. …“Risk management is a conservative principle, as is preserving our natural environment

2

Cheap port stocks still pressuring iron ore (locked)

From Platts today: Market participants said it was hardly surprising that spot iron ore prices had softened once again as the previous uptick was not supported by fundamentals. “Demand from mills and traders is actually still pretty weak, while supply remains massive,” a Beijing-based trader said. “Under such circumstances, any uptrend can only be said

13

Poker faced RBA stays neutral

Fresh from the RBA: At its meeting today, the Board decided to leave the cash rate unchanged at 2.5 per cent. Growth in the global economy is continuing at a moderate pace, helped by firmer conditions in the advanced countries. China’s growth slowed a little earlier in the year but remains generally in line with