Unconventional Economist


Geelong king hit again as more jobs cut

By Leith van Onselen It’s been a bad few months in Geelong – Victoria’s second biggest city. Last month, Ford Motor Company announced that it would cease its Australian assembly operations by 2016, with over 500 jobs set to go from its Geelong engine assembly plant. The news followed Shell’s decision to sell its Geelong


Personal loans surge in April

By Leith van Onselen The Australian Bureau of Statistics (ABS) has released Lending Finance data for the month of April, which registered strong seasonally-adjusted rises in personal and commercial finance commitments, but falls in owner-occupied housing and lease finance commitments (see next table). In seasonally-adjusted terms, the value of personal finance commitments rose by 5.2%


RP Data June housing market update

By Leith van Onselen Please find above the RP Data Housing Update for June, presented by Tim Lawless, which discusses the state-of-play of the Australian housing market as at end-May. This month’s video sees Lawless discussing last month’s 1.2% drop in national capital city dwelling values, the second consecutive fall in home values after the


Links 12 June 2013

Global Macro/Markets: The real underpinning for equities – Financial Times North America: ‘Financialization’ as a Cause of Economic Malaise – New York Times Senate Passes Bill to End Direct Payments to Farmers – Wall Street Journal Fiscal Fixes for the Jobless Recovery – Wall Street Journal Unemployment Benefits and Actual Unemployment: An Analogy – New


More signs of economic weakness in WA

By Leith van Onselen As debate rages over whether Western Australia’s economy is in recession, anecodotal reports have emerged over the past few days suggesting that the jobs market has deteriorated significantly with un/underemployment on the rise. Over the weekend, The West Australian newspaper reported how an IGA grocer experienced a sharp increase in applications


Housing finance lifts, average loan size flat

By Leith van Onselen The Australian Bureau of Statistics (ABS) has just released housing finance data for the month of April, which registered a seasonally-adjusted 0.8% increase in the number of owner-occupied finance commitments over the month. It was the third consecutive increase in owner-occupied commitments but missed analyst’s expectations of a 2% rise. The


Debunking the population boosters

By Leith van Onselen Over the weekend, Fairfax’s Matthew Kidman published an article arguing that Australia needs to continue high rates of immigration into perpetuity in order to boost growth and living standards. Below are the key extracts [my emphasis]: With interest rates and the local currency lower, Australia will travel back to a more


Auction clearances retrace on low volumes

By Leith van Onselen Auction clearance rates in Australia’s two biggest markets – Sydney and Melbourne – retraced over the long weekend, with both markets recording large falls on thin volumes. In Australia’s biggest auction market – Melbourne – clearances fell to 66% on 158 auctions reported to the REIVe to 74% on 721 auctions


Stock on market rising again

By Leith van Onselen SQM Research has released stock on market data for the month of May, which registered a large 4.8% increase in for sale listings over the month nationally and a 1.3% increase over the year (see next table). While the market is two speed – with listings in Sydney, Perth and Darwin


WA: Close but no recession

Cross-posted from Mark the Graph With the release of this week’s national accounts, there was a lot of breathless reporting that two quarters of negative growth in state final demand meant Western Australia was (technically at least) in a (perhaps domestic) recession.   The counter view, put forcefully by David Gruen from Treasury at a


Links 11 June 2013

Global Macro/Markets: As Economy Heats Up, Will Commodities? – commodities-now.com When the bond bubble finally bursts, a lot of investors will get hurt – The Telegraph North America: How did we get here? A “map” of the Fed’s balance sheet’s history – Sober Look Cash Is Fueling Quick Home Sales – New York Times Home


Corporate insolvencies rise in April

By Leith van Onselen The Australian Securities & investments Commission (ASIC) has released corporate insolvencies data for the month of April, which registered a 2.5% increase in insolvencies over the month to 941, and an 8.3% increase over April 2012. A chart plotting the raw monthly data and the 3-month moving average (3MMA) is provided


Weekly RP Data house price update

By Leith van Onselen In the week ended 6 June 2013, the RP Data-Rismark 5-city daily dwelling price index, which covers the five major capital city markets, recorded a large -0.22% decline, which followed last week’s -0.49% fall. It was the fourth weekly decline in a row (see next chart). Results were mixed, with falls


The UK housing conundrum

Cross-posted from Coppola Comment House prices in the UK are too high. How much too high they are depends on where you are: house prices have been rising in London because rich Asian businessmen and French aristocrats are buying up prime real estate as a safe haven investment for their filthy lucre, apparently. But outside


Links 7 June 2013

  Global Macro/Markets: Emerging markets displace Europe as fulcrum of world risk – The Telegraph Why Markets Have Been Rallying While Commodities Have Been Tanking – Business Insider BIS warns of dangers of cheap money driving up stock prices – Financial Times North America: Edward Lazear: The Hidden Jobless Disaster – Wall Street Journal Higher


Bloxo capitulates

By Leith van Onselen HSBC’s chief economist, Paul Bloxham, has just lowered his growth forecast and is arguing for another interest rate cut on the back of the unwinding mining boom and slower than expected rebalancing to other drivers of growth: – A weaker recovery in Asia, a persistently high AUD and a slower than


Short AUD on slowing China: strategist

Above is an interesting interview on CNBC video with Todd Elmer, Currency Strategist at Citi, explaining why now is the time short the Australian dollar. He says a slowing China has led him to change his previous bullish call on the currency. While I’m no currency strategist, I agree with his sentiments. The economy is


Trade surplus falls in April

By Leith van Onselen The Australian Bureau of Statistics (ABS) has just released trade data for the month of April, with Australia recording a seasonally-adjusted trade surplus of $28 million. The result disappointed analyst expectations, which had expected a trade surplus of $200 million. It was the third consecutive monthly surplus and follows the $555


Links 6 June 2013

Global Macro/Markets: ‘Bernake will ruin the world’ – That’s what SocGen’s Albert Edwards reckons in this piece. Debate over whether the money printing is about to end – The Telegraph North America: Politics Can’t Handle the Truth About Austerity – Bloomberg Welfare for the Wealthy – New York Times Will Mortgage Bonds Enter the Vortex? 


Bloxo sees economic rebalancing

From Bloomberg TV comes HSBC’s chief economist, Paul Bloxham’s, take on today’s March quarter GDP result, in which he sees signs of economic rebalancing. It’s an interesting take, given that domestic demand contracted by 0.3% over the quarter, with annual domestic demand growth slowing to just 1.1% – the weakest outcome since 2009. Consumer spending