Delusional Economics


Weekend Links – 1st-2nd February 2014

Global Macro / Markets: Former IMF Chief Economist, Now India’s Central Bank Governor Rajan Takes Shot at Bernanke’s Destabilizing Policies – Naked Cap The rise and fall of Bitcoin mining – DailyDot European Stocks Drop, Head for Worst January Since 2009 -Bloomberg Individual investor sentiment has turned tail in this correction.  – Bespoke There are


Long weekend Links – 25-27th Jan 2014

Global Macro / Markets: Emerging market sell-off raises specter of contagion – Reuters , Bloomberg Emerging market rout turns serious, punctures exuberance in Davos – Telegraph The stock market is correcting. What are you doing to do? –   The Reformed Broker The VIX futures curve has inverted. – BI We Can’t Afford to Leave Inequality


Weekend Links – 11th-12th Jan 2014

Global/Macro/Markets The State Of The Global Economy In Two Giant Slides – BI Bank of America Merrill Lynch slashes gold call to $1,150 and warns it could get uglier – Market Watch Blameless Blackrock – Reuters Debt Rule Faces Dilution as Regulators Heed Bank Warnings – Bloomberg The most damning critique of DSGE – noahpinion


Daily iron ore update

Iron ore charts for Jan 10th 2014 So another rough night for ore. Swap still falling, as is spot, and it looks as though the $130 mark is in danger. Futures are hoovering on lows as is steel. Given the seasonality and the Chinese New Year I wouldn’t expected to see much lift until February,


The Superannuation Story, part 1

By Martin North. Cross Posted from Digital Finance Analytics Blog In our first post for the new year, we begin a multi-part examination of superannuation, using the recently released data from APRA on industry and fund level performance to June 2013, together with DFA’s own research. Superannuation has become big business, with total assets now


Links – 10th Jan 2014

Global/Macro/Markets Blowing bubbles and the stagnation puzzle – Steve Keen BlackRock Agrees to Stop Pursuing Nonpublic Views – NYT Did Soros Just Predict a China Crash? – Bloomberg What’s That You’re Calling a Bubble? – HBR The Bitcoin-Mining Arms Race Heats Up – Bloomberg Australia & New Zealand Qantas Debt Cut to Junk by Moody’s


Retail sales up in November

Low interest rates, and possibly an influx of Poms, are still pushing through the economy with the release of ABS retail sales data for November showing a broad rise in retail trade across all states. CURRENT PRICES The trend estimate rose 0.5% in November 2013. This follows a rise of 0.5% in October 2013 and


Building approvals rise

ABS Building approval data was release this morning for Novemeber which continued to see an increase in dwelling approvals led by houses. TOTAL DWELLING UNITS The trend estimate for total dwellings approved rose 2.4% in November and has risen for 13 months. The seasonally adjusted estimate for total dwellings approved fell 1.5% in November and


Daily iron ore update

Iron ore charts for 9th Jan 2014. Not a great day for ore, but not unexpected as the seasonal slow-down in China ramps up and supply returns to normal. That, however, maybe the longer term dynamic of the market. From WSJ Iron ore may have outperformed other commodities last year, but the price of the


Links – 9th Jan 2014

Global/Macro/Markets Alibaba ban a fresh hurdle for Bitcoin  – FT IMF to revise up global growth forecasts – Telegraph Emerging Markets See Selloff -WSJ The ten biggest myths of economics – Prag Cap What Alan Greenspan Has Learned Since 2008 – HBR Australia & New Zealand Three bidders in Shell’s $3bn sell-off – AFR ,


Construction growth moderates on engineering

December PCI is out showing housing construction is doing well.. Everything else, not so much with significant falls  in engineering. The seasonally adjusted Australian Industry Group/Housing Industry Association Australian Performance of Construction Index (Australian PCI®) registered 50.8 in December 2013, indicating a third consecutive month of expansion for the national construction industry. However, the pace


Daily iron ore update

Iron ore charts for Jan 8th 2014 12M swap is still falling with spot following, while futures are up a pip. Steel isn’t looking good at all. From Reuters Chinese steel futures tumbled to a contract low on Tuesday, pressured by tepid demand and worries over a credit crunch in the world’s top consumer, putting


Links – 8th Jan 2014

Global/Macro/Markets Zynga adoption pushes Bitcoin back over $1,000 – ABC Monetary versus Fiscal: an odd debate – Mainly Macro Why everyone is so optimistic about the global economy.  – @gavyndavies Australia & New Zealand Media Super Limited latest to pay penalty under ASIC misleading ad crackdown – Property Observer ‘Private’ Royal Children’s Hospital redevelopment project


Start Yellen

Janet Yellen has leapt over the last hurdle to become the New Fed Chair. From Reuters Janet Yellen, a key force behind the Federal Reserve’s unprecedented and controversial efforts to boost the U.S. economy, was confirmed by the Senate on Monday to lead the central bank just as it begins to unwind that stimulus. When


Oz Trade deficit narrows

ABS released Australia’s International trade in goods and services data for November 2013 this morning with the deficit narrowing to $118 million. Imports fell while exports remained relatively flat. The AUD dollar took a little tumble to US89.2c on the release. ABS – BoT Nov 2013


Daily iron ore update

Daily Iron ore charts for 7th Jan 2014. As you can see 12M swaps continue to rollover as and spot has now turned down too. Futures are hovering near lows and rebar is at 7 months lows a Reuters reported yesterday Chinese steel futures fell for the second straight session on Monday to hit their


D&B see good times ahead

I will note that, as we saw with yesterday’s PSI, high expectations often precede poor performance, but Dun & Bradstreet are out this morning with a relatively optimistic survey on future business expectations. Two out of three Australian businesses (68 per cent) are more optimistic about growth this year compared to 2013, with the positive mood


Fearful Symmetry: More Indian pain ahead

The Indian economy has just experienced the weakest calendar year economic growth since 2002, and prior to that, 1991. The 1991 episode, which was a genuine balance of payments crisis, was the shock that the sclerotic system required to undertake fundamental market and internationally oriented reforms. India’s latest annushorribilis has not sparked a corresponding effort


Holiday Season Links – 7th Jan 2014

Global/Macro/Markets Reserve Banks of the world 2014 Outlook – WSJ The Relative Efficacy of Fiscal and Monetary Policy at the ZLB – Brad DeLong Where Ben Bernanke made a difference – Gavyn Davies Taiwan’s Government Says No To Bitcoin ATMs – TechCrunch Australia & New Zealand Fed Govt leaves open option of privatising Australia Post 


HSBC PMI supports “Slowing growth China”

More evidence that China’s growth rate continues to slow with today’s HSBC China PMI data Composite data signals weaker rates of output and new order growth Output and new orders increase at weaker rates at both manufacturers and service providers Manufacturers reduce their payroll numbers, while service providers hire additional staff Inflationary pressures ease to


The services Grinch stole Christmas

So much for that “Booming Christmas” we heard so much about.  From AiG The services sector finished 2013 in negative territory with the Australian Industry Group Australian Performance of Services Index (Australian PSI®) down 2.8 points to 46.1 (readings below 50 represent contraction in activIty, with the distance from 50 indicative of the strength of


Daily iron ore update

Iron market chart for 6th Jan 2014 So it looks like the rest of the market is catching up with the 12M swap price roll over as supply returns. That restricted supply has been seen in the freight market which looks to be returning to normal. Capesize iron ore freight rates trended down Friday in


My prediction for 2014 – winds of change

By Catherine Cashmore Data concluding the last 12 months of real estate activity is slowly filtering through and not surprisingly, gains were recorded in all capital cities as well as some regional localities. Louis Christopher was first out the ranks on New Year’s Day with a fairly comprehensive ‘twitter’ update from his vendor sentiment index


Holiday Season Links – 6th Jan 2014

Global/Macro/Markets Still unclear exactly how QE eases conditions: Fed’s Dudley – Reuters Gross’s Mistake on Fed Taper Echoes Across Pimco Funds – Bloomberg Grow up, change your mind.  – The Reformed Broker It’s true! The FT – and social media – really do move markets – FT 2014 outlook: Market melt-up – FT Job Flexibility


Holiday Season Links – Jan 4th-5th 2014

Global/Macro/Markets Diogenes never met Joe Weisenthal – The Money Illusion The World Economy’s Shifting Challenges by George Soros – Project Syndicate Michael Sandel: The Moral Limits of Markets – Naked Cap 2014 Predictions from Some of the Smartest Market Watchers – Yahoo IMF paper warns of ‘savings tax’ and mass write-offs as West’s debt hits


Marvelous Melbourne, Magical Margins

Cross posted from Prosper By David Collyer The weighted net annual rate of return on land investment in Melbourne 1880-92 was a remarkably high 34.6 per cent, peaking at 78.3 per cent in 1887, according to a fascinating paper researcher Philip Soos has unearthed Rates of Return on Melbourne Land Investment 1880-92  by doctoral candidate


Daily Iron Ore Update

Sorry some technical difficulties this morning so only the price chart today. Not much movement, spot is still climbing but thay may change as supply returns to normal Ports in Australia’s resource-rich Pilbara region were returning to normal and loading vessels on Wednesday after suspending shipments and evacuating staff over the weekend as tropical cyclone


Holiday Season Links – 3rd Jan 2014

After a brief stint on Star trek Cumberbatch is Sherlock again. And in other news.. Global/Macro/Markets Thousands of companies around the world reveal the state of the global economy – BI Gold Rebounds With Silver After Worst Annual Retreats Since 1981 – Bloomberg As 2014 Dawns, Fortunes Hinge on Central Bankers – WSJ Baselines still


OZ PMI falls again

The OZ PMI is out today and, as expected, the news is still dour. The latest Australian Industry Group Australian Performance of Manufacturing Index (Australian PMI®) was broadly unchanged in December, at 47.6 points (seasonally adjusted). This marks the second consecutive month of contraction in the Australian PMI® (50 points marks the separation between expansion