Houses and Holes

1

Daily iron ore price update (Vale)

Texture from Argus: “Steel mills in Tangshan have received the notice and started shutting down production. These set of restrictions are even stricter than the September restrictions,” said the manager of a Tangshan-based mill. “Restrictions will support steel prices. Iron ore demand may not fall significantly as sintering has been under controls of varying extents

6

Australian dollar soars on wings of trade rumour

DXY sank last night as EUR and CNY ran: AUD took off versus DMs: And EMs: Gold sank: Oil jumped: Copper too: And big miners: Plus EM stocks: Junk was mixed: Bonds were poleaxed: Stocks climbed: Westpac has the event wrap: US Sep headline CPI was flat m/m, with ex-food and energy +0.1%m/m, missing estimates of +0.1%m/m and

25

Fortescue demands Australia kow tow to China

Via The Australian comes the oligarchs: Fortescue Metals Group boss Elizabeth Gaines has warned that China will look to develop alternative iron ore supplies outside the Pilbara if Australia neglects its relationship with its biggest trading partner…Ms Gaines said the Australian business community needed to maintain its influence in public debate on political policies. “The

3

What would a US/China Plaza Accord do to the Australian dollar?

More trade scuttlebutt this afternoon, via Bloomie: The White House is looking at rolling out a previously agreed currency pact with China as part of an early harvest deal that could also see a tariff increase next week suspended, according to people familiar with the discussions. The currency accord — which the U.S. said had

27

Household confidence crash continues

Recessionberg! Via Martin North: In our latest release to September 2019, the DFA Household Financial Confidence Index fell again, having move sideways more recently. In essence households are simply reflecting that rate cuts, a lower dollar and the international bad news from Trump’s Trade Wars, Brexit and Hong Kong are all making them more concerned,

16

Collapsing balconies add to unit defect crisis

Via New Daily: The company that built Sydney’s Opal Tower is embroiled in another safety scare at a different city apartment block. Residents of Otto Rosebery have been warned against leaning on their balconies or allowing more than three people to stand on them, after an investigation found the balustrades were of “inadequate strength”. Parents

5

China’s golden week property shocker

Via SCMP: Property sales in China’s major cities saw one of their worst “golden week” holidays in years, as buyers held back amid a slowing economy and tight restrictions on mortgage loans. Sales of new homes in Beijing dropped to their lowest level since 2014 during the week following the National Day holiday, according to

14

Banker kings move to control RBA and Treasury

Via the AFR: Shayne Elliott, the chief executive of one of the country’s biggest banks, has called on federal Treasurer Josh Frydenberg to convene a summit to discuss the broader economic implications of zero per cent interest rates and quantitative easing. Mr Elliott, who is the CEO of ANZ Banking Group and chairman of the

10

Australian dollar, markets sink as trade deal sours

So says SCMP: Deputy-level trade talks between the US and China aimed at laying the groundwork for high-level negotiations later this week failed to yield any progress on critical issues, according to two sources with knowledge of the meetings. During the discussions on Monday and Tuesday in Washington, the Chinese refused to talk about forced

4

China’s capital war nuclear option

Via FTAlphaville: Some news Tuesday, via Bloomberg: The Trump administration is moving ahead with discussions around possible restrictions on portfolio flows into China, with a particular focus on investments made by US government retirement funds, people familiar with the internal deliberations said. China, so far, has pursued a policy of fighting fire-with-fire when it comes to

18

How to crash your energy bill 80%

Cross-posted from One Step off the Grid: The calendar says winter is over. Warmer days lie ahead. But this past winter was one when Australians in all-electric homes could be comfortable and count the dollars saved while burning no fossil gas. Home-economic studies show Australians can save money with all-electric homes by tapping in to renewable

0

Daily iron ore price update (unexpected)

Texture from Reuters: Steel inventories in China stood at 11.4 million tonnes as of Oct.7, up 594,100 tonnes compared with the week ended Sep. 26 but still the second lowest since late June, according to data from consultancy Mysteel. “Output curbs have eased after the National Day holiday, which piled pressures to (the) supply side,”

2

Australian dollar sags despite doving Fed

DXY was firm last night despite a rising EUR and CNY: The Australian dollar was weak versus DMs: And EMs: Gold rose: Oil hung on: Copper too: Big miners struggled: EM stocks did better: EM junk rolled: All bonds were sold: As stocks rebounded: Westpac has the event wrap: The FOMC minutes reflected a generally positive outlook

61

Who wins the Trump impeachment battle?

Via The Guardian: Donald Trump pushed the United States towards a constitutional crisis on Tuesday when his legal counsel said the White House would refuse to cooperate with Congress’s impeachment inquiry. “Given that your inquiry lacks any legitimate constitutional foundation, any pretense of fairness, or even the most elementary due process protections, the Executive Branch

19

Credit Suisse growth tracker crashes into deep recession

Oh yes, via Damien Boey at Credit Suisse: Over the past few days, we have witnessed some rather sharp deterioration in the leading indicators of Australian growth: Westpac consumer confidence fell sharply in early October to 92.8 from 98.2. For reference, readings below 100 have historically been associated with contraction. Westpac home-buying sentiment fell in

21

Global investors flee Aussie banks

Via Martin North: Australian banks are having their toughest time attracting investors, according to new analysis from Copley Fund Research, which monitors flows in funds with $1.2 trillion under management. An exodus by fund managers has left 91% of the 430 funds in Copley’s global analysis with zero exposure to the sector. That’s the lowest take-up on record. On average,

6

Is ANZUS worth the paper it is written on?

ScoMo thinks so: Scott Morrison has named the ANZUS Treaty with the US, which formalised the Australia-US alliance and was negotiated and signed by the Menzies government in 1951, as “the single most important achievement” of the Liberal Party in government. In an exclusive interview to mark the party’s 75th annivers­ary, the Prime Minister said

0

When will oil crack?

Via the EIA last night: Brent crude oil spot prices averaged $63 per barrel (b) in September, up $4/b from August and down $16/b from the September 2018 average. Brent spot prices began September at $61/b and increased to $68/b after attacks on major Saudi Arabian oil infrastructure disrupted the country’s crude oil production. However, Brent spot

9

Power grid descends into chaos as gas cartel laughs

Via the AFR today: The chair of the Energy Security Board Dr Kerry Schott says the rapid take-up of household rooftop solar panels in Australian cities is causing energy security problems for energy distribution companies. …”The so-called duck curve is really causing security issues for the distribution networks,” she said.Dr Schott said Australia’s power grid

6

Discarded economists rail against QE

First up, monetary curmudgeon and former RBA boffin, Stephen Grenville: So why would it be a bad idea for the Reserve Bank to undertake QE? To start with, it is unlikely to have much beneficial effect. America’s QE1, at the height of the 2008 financial crisis, was very effective because the Fed bought mortgage securities

4

Big banks to cut dividends as rorts reverse

Yesterday ANZ warned: Today there are other warnings, via Banking Day: ANZ Bank is under pressure to cut its final dividend after it revealed another blowout in customer remediation costs. …ANZ yesterday came under fire for not giving precise details on the nature of the recently identified remediation cases or any information on how many

58

Can the CCP control the whole world?

We all know the story. Chinese kiddies wanted freedom so they staked out Tienanmen Square. The Chinese Communist Party shot them instead and drew up a new social contract that promised capitalism with Chinese characteristics in return for permanent CCP dictatorship. That’s the same deal you’re being offered today. Before you decide whether you want to