Unconventional Economist

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Final auction clearance rate highest in 27 months

Last weekend, CoreLogic released its preliminary auction clearance rates, which revealed the following results: Yesterday, CoreLogic released its final auction results, which reported a 3.6% decline in the final national auction clearance rate to 73.0% – well above the same weekend last year (53.3%) and also above last week’s 67.8%: As you can see, Sydney’s final

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“Tiny home” closures push thousands into homelessness

Earlier this month, Australia’s mainstream media was awash with articles touting “tiny homes” as a solution to the nation’s growing homeless epidemic. For example, SBS News reported the following: A new Melbourne-based project is aiming to break the cycle of chronic homelessness by using otherwise vacant government land to build “tiny homes”. Independent community agency

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International students should ignore bogus university rankings

The Academic Rankings of World Universities was released last week, which placed a record seven Australian universities within the world’s top 100: The ranking, produced by the China-based Shanghai­Ranking Consultancy, is regarded by most top universities as the most ­prestigious of the international rankings because it measures only excellence in research — mainly in the

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Links 23 August 2019

Global Macro / Markets / Investing: World Bank Raises $33 Million Selling Ethereum-Based Blockchain Bonds – Be In Crypto Market top? Homemade mystery boxes are popping up on Etsy and eBay – VOX 3 Key Facts About Centralized Cryptocurrency – Medium Recession risks overblown? Money market funds’ AUM pass 2009 high – Bloomberg Americas: At

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Actuaries Institute declares war on young

The Actuaries Institute has published a discussion paper examining a range of options for overhauling Australia’s retirement income system, which includes as its central recommendation including the family home in the pension assets test, but conveniently not for the baby boomer generation. From The Australian: Actuarial expert David Knox, former regulator Anthony Asher and public

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International students trigger 2000% rise in university cheating

As we all know, Australia’s universities have experienced an incredible boom in international student numbers over the past six years, with enrolments ballooning by 327,000 (89%) over this period: One of the deleterious side effects of this boom has been the degradation of teaching standards alongside increasing reports of plagiarism and cheating across Australia’s universities.

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Australia should consider an inheritance tax

The Grattan Institute’s Owain Emslie and Danielle Wood have done a great job examining inheritances in Australia, which flow overwhelmingly to older Australians and the wealthy, thus helping to cement wealth along class lines: A sample of estates from Victoria’s probate office suggests the median estate in Victoria is worth about $500,000. That’s likely to

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Links 22 August 2019

Global Macro / Markets / Investing: CEOs Say they Will Stop Maximizing Shareholder Value–Would Be Better if they Stopped Maximizing CEO Compensation – Common Dreams Goldman Sachs Group Officially Became A Credit-Card Lender On Tuesday By Rolling Out Its First Product With Apple – Yuv News Yield curve inversion hammers US small banks – FT

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Property Council polishes high-rise apartment crisis turd

You’ve got to love the propagandists at the Property Council of Australia (PCA). After the co-author of the Shergold-Weir report into Australia’s building industry stated that she “wouldn’t buy a new apartment” on Monday’s Four Corners investigation, the chief executive of the PCA dismissed that there is a crisis, instead claiming that Australia’s building standards

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Is Australia’s low inflation a myth?

Late last month, Fidelity International produced the below chart illustrating why many Australians believe their cost of living is rising despite the low official inflation rate: Mr Doyle analysed the cost of individual products included in CPI figures and found the cost of things that many people “need” has actually risen substantially. For example, the

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Links 21 August 2019

Global Macro / Markets / Investing: Now Earning 278 Times More Than Average Worker, New Study Shows CEO Pay Has Grown More Than 1,000% Since 1978 – Rapid Rationale Recession risks rising. But do central banks have any tools? – CS Monitor Energy Cost of Energy: Fossil fuels won’t maintain conventional economic prosperity – Surplus

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AUSTRAC to get tough on money laundering… except for property

The Australian Transactions Reports & Analysis Centre’s (AUSTRAC) CEO, Nicole Rose, has flagged tough action after being ‘flooded’ with money laundering breaches. From The SMH: The nation’s anti-money laundering regulator warns it is likely to take more action against Australia’s top financial institutions after being “flooded” with reports of potential breaches following its landmark case against

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Crispin Hull demolishes ‘Big Australia’ charlatans

Fifteen years of rapid population growth has unambiguously driven a massive infrastructure deficit across Australia’s cities, which Infrastructure Australia itself has regularly admitted is impossible to bridge. For example, the 2013 National Infrastructure Plan produced by Infrastructure Australia concluded that “we still face a significant infrastructure deficit, estimated at around A$300 billion”. Infrastructure Australia’s 2018

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Should the Property Council be registered as a political party?

Here we go again. Prime Minister Scott Morrison has called for left-leaning activist group, GetUp, to be registered as a political party: Prime Minister Scott Morrison has hinted at launching a fresh bid for an inquiry into GetUp’s political independence, calling for the group to be “straight up” with voters. Members of the coalition have long

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International student bubble enters blow-off phase

Thursday’s overseas arrivals and departures figures from the Australian Bureau of Statistic (ABS) reported that international student arrivals hit a record high 612,000 in the year to June 2019: As shown above, the number of international student arrivals has increased by more than two-thirds (246,900) over the past five years. Other official data shows an

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Links 20 August 2019

Global Macro / Markets / Investing: Saudi Arabia’s Newest Strategy To Send Oil Prices Higher – Oil Price Gold Can Go Beyond 40 Thousand By Diwali – Yuv News Bitcoin Beats Every Top 10 Share with the Highest ROI – Be In Crypto “Enough is enough”: Apple files lawsuit against Corellium for copyright infringement –

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Michelle Grattan fails in superannuation spruik

Michelle Grattan has penned a spurious article claiming that raising the compulsory superannuation guarantee from the current 9.5% to 12% is essential to ensure adequate savings in retirement as well as to save the federal budget future Aged Pension costs: The temptation for scrapping the rise, or having some “opt-out” system, becomes stronger when wages

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Chinese tourists shun Australia

The Australian Bureau of Statistics last week released its overseas short-term arrivals and departures figures for June, which revealed that Chinese visitors are beginning to avoid Australia. The number of short-term visitor arrivals fell by 1.2% in June in original terms, whereas short-term resident departures rose by 12.4% over the month. The ratio of annual

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NSW building commissioner slams construction cowboys

The inquiry into NSW building standards on Friday featured the state’s new building commissioner, David Chandler, who lambasted the dodgy builders and engineers behind Sydney’s apartment crisis. From The SMH: “It’s time for the NSW building industry to be different,” Mr Chandler, an experienced builder and manager who was last month appointed to the position by

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Hong Kong international students terrified to return home

Over the past month, Hong Kong international students studying at Australia’s universities have endured growing threats and intimidation from both Chinese international students and the Chinese Government. The issue came to a head last month at the University of Queensland, when peaceful Hong Kong students protesting in favour of independence were physically attacked by a

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Links 19 August 2019

Global Macro / Markets / Investing: SoftBank plans to lend $20 billion to its employees amid volatile markets – Mazech “Enough is enough”: Apple files lawsuit against Corellium for copyright infringement – Mazech On negative rates… – Medium Bernie Madoff whistleblower says GE is a bigger fraud than Enron – CNN $3,5 bln Bitcoin Ponzi

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Weekend Reading: 17-18 August 2019

Global Macro / Markets / Investing: Bernie Madoff whistleblower says GE is a bigger fraud than Enron – CNN Global bond yields have fallen to 120-year low – MarketWatch Harry Markopolos says he can’t reveal the hedge fund he’s working for in his investigation of GE – CNBC Can Central Banks Save the Economy from

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Left and right unite in calls for an investment allowance

Earlier this week, the Business Council of Australia (BCA) called on the federal government to introduce an broad-based investment allowance to help stimulate the economy. Now, the BCA has received support from the Australia Institute. Ben Oquist, the executive director of the progressive think tank, says an investment allowance is preferable to a general cut

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Youth labour market continues to worsen

Yesterday’s ABS labour force release for July revealed a deteriorating Australian youth labour market – i.e. those aged 15 to 24 years old – with both full-time and total jobs growth falling and unemployment and underemployment rising. The trend headline unemployment rate rose to 12.0%: Total employment growth for those aged 15-24 years has dived:

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Despite correction, there’s almost no affordable housing

CoreLogic has released new data showing that despite heavy price falls across both Sydney and Melbourne, there was still very few sales priced below $400,000: Throughout the 2018-19 financial year, 26.0% of all houses sold nationally were under $400,000 and 32.5% of all unit sales were under $400,000. Despite the weakening housing market the share

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Gladys launches high speed ponzi rail vision

Late last year, NSW Premier Gladys Berejiklian proposed four routes for high speed rail (HSR) into Sydney: A high speed rail project Premier Gladys Berejiklian has committed to start work on if she wins the state election could cost $100 billion… “A reasonable figure would be $100 billion in Australian dollars to build it,” [Committee