15

Unemployment steady

Looks like I got a bit ahead of the market earlier in the week. No evidence yet of a further weakening in the labour market, even if the various marginal indicators are showing it. Unemployment was stable at 5.2%, with 20k full time jobs created and 10k part time lost.  Here’s the details from the

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38

How safe is your super?

As the Great Moderation passes by and the Great Volatility takes its place, the investing world is glacially facing up to the fact that a return OF your money is just as important as a return ON your money. The past 30 years have allowed all and sundry to “fuggedaboutit” or “she’ll be right mate”

3

Food, glorious food

RBA Assistant Governor, Phil Lowe, is on hustings this morning making a speech about the prospects for Australian food exports. Without putting too much of a dampener on it, when I used to produce The Diplomat’s Global 100, a list of Australia’s top 100 international firms, agriculture was grossly under-represented, simply because we have long

5

Australian dollar on the ropes

The Australian dollar is under intense pressure from an unfriendly world which looks to be building into a perfect storm for the world’s bellwether growth currency. It has sold down through the support I talked about earlier in the week and remains biased lower. As you can see in the chart below, it is at a critical 

55

Out of time in Italy

Not a good night for Europe. Italy had breached “containable” levels of yields on its government debt even with the ECB buying. Italian bonds reached an all time euro-high of  7.41% for the 10-year (+69bp).  The spread over German bunds hit a new all-time high of 565bp. Although it has been obvious for some time that

29

Inside the brain trust

With markets so volatile and the European situation in the headlines every day it is hard to pull your eyes away from the screens and think about the bigger picture. At the Overseas Terminal down at Circular Quay on Tuesday however Westpac did just that. For a select audience of around 250 clients the institutional

28

Captain Parko: All ahead dirt!

Yesterday, Secretary of the Treasury, Martin Parkinson, gave another in a series of speeches that seem designed to give Australia no choices in its current trajectory towards the world’s largest quarry. This is a long speech and I can’t address it all but will take what appears to be its main purpose: trashing any idea

6

Honey, I shrunk the mortgage

Some interesting analysis from Commsec (h/t auhousingcrash), confirming the thoughts of H&H last week: The average loan size plunged 1.9 per cent in September, highlighting the drop in home prices and greater influence of buying activity at the lower end of the market. The average home loan is now 0.6 per cent smaller than a

0

Can China control its descent?

Inflation in China continues to moderate.  The latest data from the National Bureau of Statistics shows that headline consumer price index (CPI) inflation has fallen from 6.1% yoy in September to 5.5% yoy in October, in-line with the consensus.  On a month-on-month basis, headline inflation in October was 0.1% vs. 0.5% in September.  Food prices is

147

Urban sprawl greenhouse myths

The Property Council of Australia (PCA) is one of those lobby groups with a blatant disregard of the facts and a history of political influence – the kind you love to hate.  For example, the PCA made a submission to the Queensland government outlining how planning laws that promote densification are likely to increase greenhouse gas emissions

6

November 10 links: Rome burns

Rocket: ore (up 6.4%, swaps up 0.5% – Chinese inflation number?) Up: $US, Treasuries, energy Mixed:  grains, metals, euro, Aussie, gold, CRB Contagion: Greece 2 Year 5 Year 10 Year Portugal 2 Year 5 Year 10 Year Ireland 2 Year 5 Year 10 Year Spain 2 Year 5 Year 10 Year Italy 2 Year 5 Year 10 Year Belgium 2 Year 5 Year 10 Year

14

Trading Day

The S&P/ASX 200 Index closed up 52 points or 1.2% higher to 4346 points today, probably on the back of the news that we had seen the back of Italian Prime Minister Silvio Berlusconi. In after hours trading, the index has given back some of these gains and is down 15 points, with Euro and

7

Bankruptcies jump above GFC

ASIC released September quarter bankruptcy data today and despite what Fairfax’s cheerleader in chief would have think, company bust number surged past GFC levels: Mr Adrian Brown, ASIC’s Senior Executive Leader of Insolvency Practitioners, said that each month of the September quarter saw a consistently high number of appointments, notwithstanding a decrease from August (1049)

27

The magic of a rate cut!

So, Consumer Confidence has a bounce on the rate cut, increasing 6.3% in November to 103.4% from 97.2 in October. Here’s the chart for month on month: Aaaaaand, year on year: According to all sane prognosticator’s hero of the moment, Westpac’s Chief Economist, Bill Evans: This result is around our expectations and is clearly driven by the

7

Buy cyclicals?

What is the best equity strategy in such an uncertain environment? Much depends, of course, on the investor’s time horizon. In the short term, with such jumpy markets, reading the signals, especially in relation to Europe’s woes, seems suitable. But of course, volatility creates many risks. In the medium to longer term, it is likely

27

Sydney investors drive housing finance

ABS Housing Finance for Spetember is out and shows some recovery in the headline numbers: SEPTEMBER KEY POINTS VALUE OF DWELLING COMMITMENTS September 2011 compared with August 2011: The trend estimate for the total value of dwelling finance commitments excluding alterations and additions rose 0.9%. Investment housing commitments rose 1.0% and owner occupied housing commitments

76

Peter Costello confesses

There is a terrific piece of rhetoric from Peter Costello today at Fairfax. It is a must read in terms of historical revisionism and politicking: Imagine an investment portfolio – say your superannuation fund – which has a whole bunch of assets that are going sideways and one prime asset that is growing strongly. Imagine

28

Europe reaches its bogus goal

There is one thing you can say about Europe, they never waste a crisis, the side show soap opera spectacular continued last night.  It has been going on for so long now that the market seems to have set itself false goals and then managed to convince itself that they equate to something important when

57

Unemployment looks set to jump

Tomorrow the ABS releases its October Labour Force survey and the chances are growing that we’ll see a jump in unemployment.  The August report wasn’t bad, with the unemployment rate falling from from 5.2862044% to 5.2477873%. But despite the decent month, the trend for unemployment is firmly up: Another measure that appears to have crossed an

34

WA Budget’s housing black hole

On Monday, I showed how the Victorian State Budget is likely to get hit hard from declining stamp duty receipts as house prices and transaction volumes fall. Thanks to reader aushousingcrash, I was able to source some interesting data on Western Australian (WA) housing transaction volumes which, when combined with falling home prices, paints a

1

Wielding China’s reserves

I have argued a number of times that the Chinese yuan could depreciate, against the consensus. Now, according to the Financial Times, Fan Jianping, chief economist of the State Information Center, thinks that yuan should be allowed to weaken: Fan Jianping, chief economist of the State Information Center, a think-tank within the powerful state planning bureau,

0

Chart of the Day: S&P earnings record

Another chart on the US S&P500 stock index, is from Bespoke Investment Group (via Seeking Alpha). US stock markets report earnings quarterly, as opposed to half yearly in Australia, and with almost 90% of companies in the S&P500 having reported for the third quarter (Q3), Bespoke estimate earnings at $25.42, or on a year’s trailing basis

19

November 9 links: Berlusconi goes

Up:  CRB, energy, ore, gold Mixed:  grains, metals, euro, Aussie, $US, Treasuries Contagion: Greece 2 Year 5 Year 10 Year Portugal 2 Year 5 Year 10 Year Ireland 2 Year 5 Year 10 Year Spain 2 Year 5 Year 10 Year Italy 2 Year 5 Year 10 Year Belgium 2 Year 5 Year 10 Year France 2 Year 5 Year 10 Year Germany 2

6

Trading Day

The S&P/ASX 200 Index closed up 20 points or 0.48% higher to 4293 points today. In after hours trading, the index has given back on these gains and is down 20 points, with Euro and US markets are pointing to slightly lower or steady opens. Asian markets had a mixed day, with Japan’s Nikkei 225

19

Confidence trick

It takes a certain quantity of chutzpah to be a blogger. You need to know your subject well and be able to bat away your critics with good arguments. You can’t be afraid to stick your head out. In sum you might say you need a fair dollop of confidence. Especially if you’re going to