Unconventional Economist


Population ponzi to gobble up Melbourne’s water supply

By Leith van Onselen Infrastructure Victoria CEO, Michel Masson, on Friday called on the state to take its time when deciding large infrastructure projects, while also arguing that it is often better to improve existing assets than to build expensive new ones. From The AFR: Australia should abandon its “childish” attitude of wanting new infrastructure


Academic turns from mass immigration skeptic to booster

By Leith van Onselen The Australian’s Judith Sloan penned the following on Friday about the heated debate that she had with University of Melbourne demographer, Peter McDonald, with respect to Australia’s turbo-charged immigration intake [my emphasis]: I was engaged in a relatively heated but civil discussion of immigration with University of Melbourne demographer Peter McDonald


Auction clearances continue to strengthen

CoreLogic released its auction report yesterday, which reported a continued firming in the national auction clearance rate to 74.8% from 72.4% last weekend, and was also above the 71.5% recorded in the same weekend last year: Auction volumes nationally were 1,712 – way above the 1,329 recorded in the same weekend last year. As shown above, Sydney’s


Links 24 July 2017

Global Macro / Markets / Investing: Suddenly Becoming a Bond Manager in the Credit Crisis – Bloomberg Multi-party kleptocracies rather than illiberal democracies – Global Inequalities 10-Year Returns of U.S. Median Active and Passive Managers – PIMCO The heat goes on: Earth sets 9th straight monthly record – AP Venezuela’s Perfect Storm for Oil May


Weekend Reading 22-23 July 2017

Global Macro / Markets / Investing: The New “Supply-Side Economics” Fueling Asset Bubbles – Macro Mom What the Decline of the Dollar Means – NY Times IMF Falls Short of Transparency Rules as Key Discussions Remain Secret – WSJ The power of populists – The Economist Americas: Trump’s Threat to Jail Clinton Also Targets Democracy’s


Is Australian inequality rising?

By Leith van Onselen Melbourne Institute of Applied Economic and Social Research deputy director, Roger Wilkins, has today labelled “patently false” the claim by Labor leader Bill Shorten that inequality in Australia is rising. From The AFR: Professor Wilkins told the Economic and Social Outlook Conference that the Australian Bureau of Statistics data on which


Anatomy of an Auckland housing disaster

By Leith van Onselen Back in March, New Zealand’s Productivity Commission (PC) has released a report entitled “Urban planning – moving beyond the wheel spin”, which basically concluded that Auckland’s housing system is under siege from the combination of rapid population growth butting heads with a dysfunctional planning system, which is unable to cope with


NZ immigration hits another record high

By Leith van Onselen Statistics New Zealand has released its permanent & long-term migration figures for June 2017, which revealed that annual net permanent and long-term migration into New Zealand hit a record high 72,305 people over the year: According to Statistics New Zealand, migrant arrivals were a record high 131,400 in the June 2017


Labor immigration extremism threatens inequality agenda

By Leith van Onselen In yesterday’s address at the 2017 Economic & Social Outlook Conference, Labor treasury spokesman, Chris Bowen, launched a classic straw man argument against cutting Australia’s mass immigration program, disingenuously conflating the issue with rising global trade protectionism [my emphasis]: This brings me to the broader context in which the budget debate


Links 21 July 2017

Global Macro / Markets / Investment: Growth and volatility before and after the Global Crisis – VOX These pictures show how ethereum is taking over the digital currency world – CNBC Ethereum Suddenly Crashes 20% Amid Chatter Of More ICO Fraud; But Goldman Sees Bitcoin Testing $3000 – Zero Hedge $30 million below Parity: Ethereum


Leith van Onselen talks housing/economy on Perth radio

Please find above an interview I gave this morning on Perth Radio 6PR regarding the WA economy and Perth housing market. For reference, below is the key chart relating to my argument about WA’s housing construction falling (hence dragging on jobs and growth), while at the same time easily outpacing population growth (suggesting further oversupply):


Unemployment in detail: broad-based improvement

By Leith van Onselen As summarised earlier, the Australian Bureau of Statistics (ABS) today released its labour force report for June, which registered a solid 14,000 increase in total employment and no change to the headline unemployment rate (still 5.6% after last month’s figure was revised upwards). In trend terms, the unemployment rate fell marginally


Thousands of high-rise apartments at risk of towering inferno

By Leith van Onselen The extent that Australia’s high-rise apartments are exposed to combustible cladding similar to that which engulfed London’s Grenfell, killing more than 50 people, is beginning to come to light. Yesterday, the second day of the Senate’s inquiry heard that thousands of apartments in Sydney and Melbourne are potentially at risk. From


Company tax cut sucked into dividend imputation black hole

By Leith van Onselen In the year leading-up to the Turnbull Government announcing its company tax cut, I frequently argued that it would have minimal impact on Australian business owners and shareholders because of Australia’s dividend imputation system. For example: Whether company tax cuts are extended to $10 million turnover businesses or $50 million turnover


Western Sydney to bear brunt of property downturn

By Leith van Onselen ABC Lateline last night ran an interesting segment on the Western Sydney housing market, which is the most vulnerable to a correction. The segment profiles a new housing estate 50 kilometres north-west of the city, called the Hills of Carmel, whereby a typical house and land packages are on sale for


Domain: house prices rise, rents fall in June quarter

By Leith van Onselen Domain (formerly Australian Property Monitors) has released its State of the Market Report for the June quarter, which revealed a stark divergence between prices and rents, with dwelling prices recording solid growth but rents falling. The below tables show the change in stratified median prices for both houses and units: As


Labor to push for an inheritance tax?

By Leith van Onselen The Australian Labor Party’s national conference will be held in late July, and it is rumoured that the left faction is seeking the re-implementation of an inheritance tax. From The Australian: Several left-aligned branches support the introduction of a national­ inheritance tax to address­ the growing divide between rich and poor:


Dick Smith rips population ponzi on Mark Latham’s Outsiders

By Leith van Onselen Australian entrepreneur, Dick Smith, last night appeared on Mark Latham’s Outsiders, whereby he once again challenged Australia’s tri-partisan mass immigration ‘Big Australia’ policy (interview from 10.50): Dick Smith: “I think they [policy makers] are crazy. Eight out of 10 Australian’s I talk to – I’ll get stopped in the street –


Will APRA sting the banks on mortgage risk-weightings?

By Leith van Onselen ABC’s business reporter, Stephen Letts, penned an article yesterday raising the prospect that the Australian Prudential Regulatory Authority (APRA) could still sting the big banks by raising mortgage risk-weightings: [APRA] has yet to tell the banks what it plans to do with mortgage risk-weightings. All that is known is that they