David Llewellyn-Smith


Commodities just another Wall Street bubble

When one sits around all day reading Wall Street research, patterns emerge. One is that professional managers very obviously read one another’s stuff and copy it. Another is that Wall Street likes to find a kernel of truth in some market, blow it out of all proportion, and inflate a bubble so it can front-run


Victorian fuckdown to end

Thank god. My sixth fuckdown will likely end tomorrow tonight: Reported yesterday: 1 new local case, 0 new cases acquired overseas. Got symptoms? Get tested. – 19,533 vaccine doses administered – 28,485 test results received More later: https://t.co/lIUrl0ZEco#COVID19VicData #COVID19Vic pic.twitter.com/wc5BUgm6OK — VicGovDH (@VicGovDH) June 8, 2021 Some restrictions remain and it will be a staged


Morrison’s post-iron ore economic plan comes from Nauru

Australia’s evolving Cold War 2.0 circumstances continue with stunning speed. The personality-disordered PM is on the hustings today with a new round of China-bashing: Morrison has warned about an emerging struggle between authoritarianism and liberalism. The Indo-Pacific is its epicentre with the rising risk of conflict. He aims to reform the WTO to fight economic


China to “halve iron ore” use by 2030

Australia’s nemesis, The Global Times, is back today with more Australia bashing: #Australia has good reason to diversify its #ironore exports to #China ASAP. According to Rafael Suchan, CEO of Germany’s Scholz Recycling Group, China’s iron ore imports will be nearly halved by 2030 with the help of steel scrap #recycling. pic.twitter.com/X9mEJmoekD — Global Times


Overheated NAB survey screams steep interest rate hikes

The NAB business survey used to be a quite useful forecaster of GDP and its segments. These days it’s become more like a PMI, only useful for directional rather than positional judgements. To wit, this is an unprecedented boom across all metrics: Capacity utilization has been pushed the highest measures in living memory which would


US property boomlet to pop

BofA with the note: The economy is facing an imbalance: a burst in demand has been met with constrained supply. Economics 101 tells us that when the demand curve shifts more than the supply curve, prices will rise, which continues until the balance is restored from a combination of slowing demand and greater supply. This


Chinese local governments set to storm debt markets?

Readers will recall that there has been something a mystery in some components of the very steep slowdown in Chinese debt issuance over the last four months. Most pointedly, local government borrowing, which accounts for a lot of infrastructure and property investment, cratered 80% year on year in the four months to April despite having


Canada to open to vaccinated tourists

As Morrison’s Prison Island falls ever further behind in the vaccine race, the northern hemisphere is beginning to open up to tourism. Europe is preparing to launch vaccine passports. Domestic US tourism is exploding higher. Now Canada is leading the reopening of borders to the vaccinated: Wokester Justin Trudeau is considering easier border controls. The


What’s the best asset hedge in the world?

Economically speaking, Australians are very fortunate people. We are also some of the most ignorant. These truisms are played out superbly in the least understood yet most important feature of Australian markets. What’s the best asset hedge in the world? This, via BNP Our analysis has two stages: a historical assessment of the most reliable


Morgan Stanley: Stocks to tank 15%

Morgan Stabley bearing it up: Over the past few weeks, we’ve been spending a lot of time with investors discussing and debating our mid-year outlook. Here are the highlights: First,investors are definitely more receptive to the mid-cycle transition narrative that we introduced a few months ago. There’s an acknowledgement that something has changed in the


Why you should never invest in China

I have been warning of this for nearly a decade as I watched various Australian investment legends blow themselves up in China, including Kerr Neilsen and Hamish Douglass. Investing into China is foolish for one simple reason: the sovereign risk is off the chart. This is not an academic measure of risk. Nor is it


US travel roars back to normal

Some interesting sector-level trends in US credit card spending. Services spending is normalising swiftly as reopening gathers pace. There are early signs that goods spending is falling away as well: Eating out is now up on pre-pandemic levels. Travel is roaring back to almost unchanged from 2019. I expect a big overshoot ahead. Interestingly, goods


No more ghost cities for China

TS Lombard with the note After leading the recovery last year, real estate investment is set to decelerate under macro and sector-specific deleveraging campaigns as well as higher input costs. We expect property investment to reach 5% yoy in H2/21 from13% you in April. The slowdown will hit local government financing and investment. The combined


US inflation how high for how long?

Nordea with the note. I see US inflation tumbling next year: We see clear risks of a big positive surprise to the May inflation report as well with core inflation around or just above 4%. The market is still buying the transitory inflation narrative but for how long? Lately, increasing (US) inflation has been the


Can a wolf warrior change his spots?

Not according to  Bill Bishop at Sinocism: Comment: David Bandurski of the China Media Project has written an excellent article on the Politburo’s collective study session on global discourse power and the wishful thinking in some quick takes about a change in tone/halt of “wolf-warriorism”. He provides good background on the discussant, Fudan University professor