Unconventional Economist


Trade deficit narrows in February

By Leith van Onselen The Australian Bureau of Statistics (ABS) has just released trade data for the month of February, and it’s an improvement on January’s shocker – arguably affected by the Chinese New Year celebrations – where a deficit of -$971m was recorded (revised up from -$673m) – a whopping turnaround of -$2,229 million


Retail sales subdued in February

By Leith van Onselen The Australian Bureau of Statistics (ABS) has just released the retail trade data for the month of February and, while it met analysts’ expectations, the release shows a sector still suffering the effects of household disleveraging. In seasonally adjusted terms, retail sales rose by 0.2% in the month of February and


RP Data March report and video

By Leith van Onselen Please find attached RP Data-Rismark’s press release for the 31 March home value indices results. The key tables and figures from the release are provided below. First, the table summarising the key movements and levels for each capital city and nationally: Note that Canberra now has the most expensive dwellings in


Commodity prices rise in March

By Leith van Onselen Yesterday afternoon, the Reserve Bank of Australia (RBA) released their preliminary index of commodity prices for the month of March. According to the release: Preliminary estimates for March indicate that the index rose by 0.6 per cent (on a monthly average basis) in SDR terms, after rising by 1.2 per cent


NSW hits building approvals

By Leith van Onselen The Australian Bureau of Statistics (ABS) has just released the Building Approvals data for the month of February. At the national level it is another shocker with the number of dwelling approvals falling a seasonally adjusted 7.8% to 10,771, compared to a downwardly revised 11,688 units in January. Economists had forecast


Australia: Playing with fire

Please find below former Reserve Bank of New Zealand advisor and multiple CEO, Terry “Macca” McFadgen’s, latest ‘Maccanomics’ article, which tackles the reviving United States economy. Enjoy! Australia’s recent history has been remarkably free of recessions. For nearly 20 years up to the global crash of 2008/9 the country clocked up regular growth. Call it good


Canadian taxpayers spared… for now

By Leith van Onselen The Teranet – National Bank Composite House Price Index was released last week, reporting that Canadian house prices recovered slightly after two straight months of declines. According to Teranet: Canadian home prices in January were up 0.1% from the previous month, according to the Teranet-National Bank National Composite House Price Index™.


Housing credit growth subdued in February

By Leith van Onselen The Reserve Bank of Australia (RBA) has just released the private sector credit aggregates data for the month of February: Total credit provided to the private sector by financial intermediaries rose by 0.4 per cent over February 2012, after rising by 0.2 per cent over January. Over the year to February, total credit rose by


Mortgage brokers hold out hand for support

By Leith van Onselen Following on from yesterday’s article, Credit-dependent industries demand rate cuts, Australia’s mortgage broking industry has today called on the Reserve Bank of Australia (RBA) to cut official interest rates and for the Federal Government to increase subsidies to first home buyers, in an attempt to reinvigorate the flagging housing market: Mortgage


Job vacancies continue downward trend

By Leith van Onselen The Australian Bureau of Statistics (ABS) this morning released job vacancies data for the February quarter, which continued their downward trend: Total job vacancies in February 2012 were 182,200, a decrease of 0.3% from November 2011. The number of job vacancies in the private sector was 165,300 in February 2012, a


Population growth continues to normalise

By Leith van Onselen The Australian Bureau of Statistics (ABS) has just released the Australian Demographic Statistics, which shows Australian population growth at ‘normal’ levels. According to the ABS, Australia’s population grew by 1.4%, or 320,000 people, in the year to September 2011. In percentage terms, this is just on the 30-year average level; although


Credit-dependent industries demand rate cuts

By Leith van Onselen With new home sales hammered: Annual housing credit growth running at all-time lows: And retail sales flatlining in real terms since the onset of the Global Financial Crisis: Australia’s credit-dependent industries have stepped-up pressure on the Reserve Bank of Australia (RBA) to deliver interest rate cuts. First, it was Premier Investments


RP Data daily house price index

By Leith van Onselen Starting today, I am changing things up. From now on I will post the daily house price indices from RP Data-Rismark, as well as three charts showing: the daily percentage movement by capital city; the weekly percentage movement by capital city; and the month-to-date percentage movement by capital city. First up,


The Las Vegas lesson for Australian property

By Leith van Onselen The above YouTube video shows spectacular satellite footage of Las Vegas’ rapid urban growth since the early-1970s. Las Vegas is home to one of the world’s largest housing bubbles/busts, whereby house prices rose sharply in the decade to 2007 before plunging more than 60% in the years following (see below chart).


RP Data daily house price indices

By Leith van Onselen Please find below the RP Data-Rismark daily house price indices for 28 March 2012: And below are the index values as at the end of February, which you can compare to the above daily movements to get the month-to-date home price movements in each capital and nationally: Finally, for a longer-term


Rental vacancies rise 8% YoY

By Leith van Onselen Sorry folks, almost missed SQM Research’s release last week of the capital city rental vacancies data for the month of February: As you can see from the above table, rental vacancies fell by -2,279 (-4.6%) in February, but remained  3,662 (+8.4%) higher than in February 2011. Melbourne, Sydney, Brisbane, Adelaide, Hobart


UK first home buyers trapped

By Leith van Onselen The United Kingdom (UK) housing correction has now entered its fourth year. Depending on the indices used (explained here), UK home prices have declined by between -5% and -19% since peak (more in inflation-adjusted terms): However, it’s been a two-speed correction, with London home prices now rising, but much of the


The Anzac’s greying wealth

By Leith van Onselen Over the weekend, Interest.co.nz’s Bernard Hickey posted a cracking article showing how the distribution of household wealth in New Zealand has shifted heavily towards the older generation courtesy of the housing boom: This week Roy Morgan published its annual State of the Nation survey showing a stunning rise in the wealth


Screws tighten on Canadian housing market

By Leith van Onselen Last month, in Canadian bubble trouble, I described in detail how the government-owned Canadian Mortgage Housing Corporation (CMHC), which has been the “great enabler” behind Canada’s debt-fuelled housing bubble, risks losing billions of taxpayer dollars in the event that the housing market experiences a severe correction: CMHC works by acting as


7 rate rises in the next 15 months?

Leith van Onselen BIS Shrapnel was out this week with some startling predictions for the Australian economy and housing markets. It’s worth taking a look, although let’s remember that their recent form on both the economy and housing has been questionable. For example, in July 2010 – near the peak of Australian house prices –


Commodity exports to the moon!

By Leith van Onselen The Bureau of Resources and Energy Economics (BREE) released its Resources and Energy Quarterly—March quarter 2012 (report below) yesterday, which provides a bullish outlook for Australian commodity exports. From the press release [my emphasis]: Australia’s resources and energy commodity export earnings are forecast to continue to grow over the medium term


The exponential end game

By Leith van Onselen On Monday, I published a post entitled “Dangerous Exponentials”, which summarised recent research by Dr Tim Morgan, Global Head of Research for Tullett Prebon. In this research, Dr Morgan presents a series of “dangerous financial and non-financial exponentials” that are not sustainable and ultimately risk destroying the economy, environment, and overall living


Uren turns bearish on Australian property

By Leith van Onselen I came across an interesting article yesterday by The Cupboard’s Economics Editor, David Uren, entitled: Australian housing market just a jobs crisis away from collapse. It is one of the more bearish pieces we’ve seen in the increasingly circumspect MSM recently. Let’s take a look: STOCKS of unsold apartments and houses


Housing swallows economy

By Leith van Onselen RPData, provided and interesting tidbit of information in its 2012 Capital Markets Report (available for download here), where it noted [my emphasis]: The Australian housing sector is the country’s largest and, arguably, most important asset class. The total value of homes across the country as at December 2011 was $4.54 trillion.


Dangerous exponentials

 “Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist”. Kenneth Boulding By Leith van Onselen Earlier today, The Prince published a thought provoking article questioning the economy’s addiction to population growth. It’s an issue that I have been pondering since reading the below Strategy


It’s hip to be bear

By Leith van Onselen For me, one of the most interesting aspects arising from following the Australian housing market over the past couple of years has been the widespread change in media and public sentiment towards the state of the market. Since writing my first ever post warning of a housing bubble in May 2010