Houses and Holes

1

COVID dogs Chinese unrecovery

Via FTAlphaville Ajay Rajadhyaksha is global chair of research at Barclays. Having seemingly successfully beaten back Covid — cases were below 100 last week, in a country of 1.4bn — China announced that it was open for business again. Can it last? Already, the signs are ominous. Shanghai officials this week increased testing capacity and

13

Albert Edwards: Hard landing dead ahead

I have been at this point in the credit and economic cycle many times in my career and certain things always seem familiar. First the inversion of the yield curve, which is dismissed as a predictor of recession, despite its reliability. Then slightly later, as the economic data slows decidedly, the chorus of economists claiming

59

Teals smash Albo’s energy cowards

As it turns out, the only problem with the last election result is that Labor got too much of the vote. If we had a Teal minority government today the energy crisis would be all but over: Independent MPs Zali Steggall, Allegra Spender, Kylea Tink and Zoe Daniel on Thursday ­attacked gas companies and ­accused

15

Albo’s energy war-profiteers kill power, banks and food

Ah, the Australia Tax, brought to you by David John Wissler Knox who, you may recall, said this: As Santos worked toward approving its company-transforming Gladstone LNG project at the start of this decade, managing ­director David Knox made the sensible statement that he would approve one LNG train, capable of exporting the equivalent of

17

Australian dollar 60 cents it is

DXY is up and away: Confirming the end of the bear market rally is the forex crosses, notably the JPY flameout: Oil is the culprit. The Fed must end it: Metals being eaten now: Miners too: Brace for new lows on EM stocks: As junk free falls towards a credit event: Treasuries were hammered and

1

One King Dollar to rule them all

TSLombard with the note. Indicators of market funding stress jumped in response to Russia’s invasion of Ukraine in late February. But they soon retraced back to more normal levels, underscoring the view that central banks have learned from past crises and are prepared to step in without delay to address dislocations in market liquidity. Metrics

1

China reopens, property stays shut

The Chinese unrecovery is progressing well. COVID is still popping up regularly: Mobility is slowly lifting: Property and trade remain shut: Property especially is showing no change: Sunac China, the country’s third largest property developer by sales, is seeking to extend repayment of an onshore bond due June 13 by two years, first reported by

4

Energy war-profiteers kill the banks

Typically, banks and energy companies enjoy a similar factor rotation in stock markets, marked as cyclicals. Both benefit as the economic cycle enters the expansion phase, which is where we should be about now. However, the last week has witnessed a startling divergence in this relationship. Banks have suddenly gone from cyclical heroes to late-cycle

27

Energy war-profiteers launch JobSmasher unstimulus

You’d think that they’d learn. As I helped pull together the second version of the Garnaut Climate Change Report in 2011, the Gillard Government was watching its polls slump relentlessly. Many didn’t understand why. Sure, the deposing of Kevin Rudd had upset many. But there was something else going on that was really pissing off

0

Chinese capital outflow to continue

Pantheon right again.  — The latest Chinese FX reserves data for May suggest an improving backdrop for the currency, rising to $3,128B, from $3,120B in April. This brings to an end the longest streak of declines in reserves since 2016. But the data flatter to deceive. The gain in reserves came during a period of

67

Mad King is not up to it

This is garbage from the new Resources Minister, Mad King: The energy market is littered with phony solutions. Interviewed by this paper, King says it’s time post-election for Australian culture to move beyond ideological battles over energy sources. Asked if the climate wars are over, the new Resources Minister says: “I hope so. If they’re

4

Australian yield curve smashed

The Aussie bond curve is starting to price in the RBA policy error. Short-end yields are soaring while long-end have stalled out: The curve has been flattened by a steamroller and the belly is almost inverted: Spread to the US are still trending wider offering some support to the AUD: If Albo’s cowards add energy

24

Energy shocked lobbies commit economic suicide

And the Australian Pet Shop is open for business: bark, squawk, screech, howl, defecate: A broad coalition of peak bodies today called on the Wednesday crisis meeting of Australia’s energy ministers to work together both on immediate responses to calm chaos and on longer term measures to moderate energy prices and cut emissions by improving

24

RBA delivers energy war-profiteering recession

Don’t say I didn’t warn you. The RBA statement: Inflation in Australia has increased significantly. While inflation is lower than in most other advanced economies, it is higher than earlier expected. Global factors, including COVID-related disruptions to supply chains and the war in Ukraine, account for much of this increase in inflation. But domestic factors

31

Wolf wankers return

Yawn: Beijing has warned Australia to respect its national security interests and avoid potential “serious consequences” after Canberra accused a Chinese fighter jet of intercepting an RAAF aircraft over the South China Sea. China’s Foreign Ministry on Monday night did not confirm or deny the incident but a spokesman said the Chinese military carried out