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China’s cryptocurrency crackdown: a sign of things to come

Cross-posted from The Conversation: The Chinese government’s decision to order several Bitcoin and other cryptocurrencies exchanges to close shows how much of a threat they are perceived to be to financial stability and social order in China. The decision to also ban initial coin offerings altogether (the unregulated means by which funds are raised for

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FHB patsies bribed into East Coast property bubble

By Martin North, cross-posted from the Digital Finance Analytics Blog: Today we commence a short series on the results from our latest household surveys, as we examine the drivers of property demand by household segment. These results, from our 52,000 sample to September 2017 reveals that a significant rotation is underway, with first time buyers

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Steve Keen: Soaring global debt risks another GFC

Cross-posted from The Conversation: This phrase may have religious roots, but there is no better way to describe the dominant sect in economics today than as wilfully blind. A decade after the 2007-08 crisis, most still repeat the mantra that it could not have been predicted. Nonsense. The data that showed what would cause the

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Financial resilience is declining in Australia

Cross-posted from The Conversation: If you needed A$2,000 in a hurry where would you get it? 70% of those we surveyed said they would ask friends or family, although almost half said that it’s very or fairly unlikely that their social connections could help. This is just one of the takeaways from our new report,

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Banking sector to be culled by automation

Cross-posted from The Conversation: Deutsche Bank CEO John Cryan has predicted a bonfire of industry jobs as automation takes hold across the finance sector. Every signal is that he will be proved right very soon. Those roles in finance where the knowledge required is systematic will soon disappear. And it will happen irrespective of how

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Market forces, weakened institutions, are crushing wages growth

Cross-posted from The Conversation: Within the political class there is a low level moral panic about low wages growth. The irony is that those lamenting this situation are simply witnessing the ultimate outcome of policies they have long advocated. While Australia still has systems like Industrial Tribunals and Awards – given how they interact with

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Household finance confidence continues to weaken

By Martin North, cross-posted from the Digital Finance Analytics Blog: Digital Finance Analytics has released the August 2017 edition of our Household Finance Confidence index, which uses data from our 52,000 household surveys and Core Market Model to examine trends over time. Overall, households scored 98.6, compared with 99.3 last month, and this continues the

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The costs of a casual job outweighs any pay benefits

Cross-posted from The Conversation: Workers aren’t being compensated as much as they should be for precarious work in casual positions. One in four Australian employees today is a casual worker. Among younger workers (15-24 year olds) the numbers are higher still: more than half of them are casuals. These jobs come without some of the

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Mortgage stress continues to rise

By Martin North, cross-posted from the Digital Finance Analytics Blog: Digital Finance Analytics has released mortgage stress and default modelling for Australian mortgage borrowers, to end August 2017.  Across the nation, more than 860,000 households are estimated to be now in mortgage stress (last month 820,000) with more than 20,000 of these in severe stress.

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How CBA invited in the criminals

By Nathan Lynch of Thomson Reuters. By early 2015, Commonwealth Bank’s investment in the rollout of hundreds of intelligent deposit machines across Australia was paying off handsomely. The country’s largest financial institution was reporting bumper profits. The gradual automation of its teller services, via this new kit, along with the push towards 24/7 banking, was

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Unemployment and the bullshit work-ethic

By Gavin R Putland Some else wants to do your job. So why does it matter if you do it? In a logical world, if you don’t do your day job, your idleness imposes a loss on the rest of us. In the real world – where the official involuntary unemployment rate is rarely less

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Australia’s household debt monster

By Martin North, cross-posted from the Digital Finance Analytics Blog: We had significant reaction to yesterday’s post on the “normal” status of high household debt. So today we take the argument further using data from the RBA Household Balance Sheet series (E1) and the recent ABS data on income growth. The traditional argument trotted out

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Construction-led growth is ponzi growth

Cross-posted from The Conversation: Any downturn in the construction industry could trigger job losses to a range of sectors that support the building industry, such as planning, project management, real estate and property services. This threat reveals the risk of relying on building and construction to sustain the economy. Since before the global financial crisis,

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As regulators circled, CommBank board was forced to take action

By Nathan Lynch, Asia-Pacific bureau chief, financial crime and risk, Thomson Reuters The Commonwealth Bank money laundering scandal claimed its first scalp yesterday morning, with the imminent departure of chief executive Ian Narev. For the embattled CBA chief, the A$8.9 billion smart laundromat affair was the last straw. This article explores the untold story of

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Is Skynet really coming for our jobs?

Cross-posted from Independent Australia: It’s almost scary to think that the world as we know it may well be run by Artificial Intelligence (AI) one day. While the risk of an imminent AI disruption of the labour market may sound like a fantasy, those with the most advanced AI technologies at hand think that AI

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The NBN needs subsidies if it is to work

Cross-posted from The Conversation: Half of all Australians are now able to connect to the NBN. But around 40% of eligible households have chosen not to connect to the network. Our modelling shows that subsidising the NBN is key to encouraging more Australians to connect. This would benefit the economy as a whole, but hurt

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Australia: More Edwardian than egalitarian

Cross-posted from The Conversation: Recent commentary on levels of inequality exposes the myth that Australia is an egalitarian society in which the privileges of birth have little currency. Focusing on inequality in the distribution of incomes ignores an equally important dimension of inequality: wealth. Wealth is much more unequally distributed than income. Therefore, ignoring wealth

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The myth of the “20-minute city”

Cross-posted from The Conversation: Liveability is an increasingly important goal of Australian planning policy. And creating cities where residents can get to most of the services they need within 20 to 30 minutes has been proposed, at both federal and state level, as a key liveability-related mechanism. The previous federal government’s 2010 National Urban Policy

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Affordable housing shortfall leaves 1.3m households in need

Cross-posted from The Conversation: A new report by the Australian Housing and Urban Research Institute (AHURI) reveals, for the first time, the extent of housing need in Australia. An estimated 1.3 million households are in a state of housing need, whether unable to access market housing or in a position of rental stress. This figure

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Household finance confidence continues to fall

By Martin North, cross-posted from the Digital Finance Analytics Blog: Digital Finance Analytics has released the July results from our Household Finance Confidence Index, which shows a further fall, with momentum decaying. The average score was 99.3, down from 99.8 last month and below the neutral setting. However, the average score masks significant differences across

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CBA money laundering bolsters case for Royal Commission

Cross-posted from The Conversation: The Commonwealth Bank is facing another scandal as the Australian Transactions Reports and Analysis Centre (AUSTRAC) launches civil proceedings accusing the bank of being complicit in money laundering. This exposes a deeply worrying prospect, that the Australian public are vulnerable to crime and terrorism directly funded through the Australian banking system.

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RBA Statement on Monetary Policy – August 2017

By Gareth Aird, Senior Economist at CBA: Key Points: The RBA has shaved a little from their near-term growth forecasts while medium-term projections are broadly unchanged. Headline inflation forecasts have been nudged up while core inflation forecasts have been left unchanged. The RBA have a shallow downward trajectory for the unemployment rate that glides to

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Why there’s conflicting signals about inequality

Cross-posted from The Conversation: Is inequality rising or falling? The answer, if recent public debate is anything to go by, may appear at first to depend on who you ask. Part of the reason why we get such conflicting narratives about whether it’s rising or falling is that economic inequality can be measured in different

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Australia’s vanishing back yards a health risk

Cross-posted from The Conversation: The traditional Australian suburban backyard is being lost to higher-density housing and massive project homes on small lots. City planning is focused on making cities more compact, which in some ways is desirable, and the large backyard is seen as unsustainable and undesirable because of the space it consumes. But its loss

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Falling home ownership. Rising debts. Things are looking grim for under-40s.

Cross-posted from The Conversation: Home ownership among young people is declining, as mortgage debt almost doubles for the same age group, results from the Household Income and Labour Dynamics in Australia (HILDA) survey show. It also shows young people are living with their parents longer. The Melbourne Institute of Applied Economic and Social Research undertakes