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Europe falling in a heap again

Today we note that Europe is back in “self hate” mode: Talks between Portugal’s socialist government and the main opposition party over a disputed austerity budget have collapsed, pushing the country closer to a sovereign debt crisis The opposition Social Democratic party (PSD), which holds the balance of power in parliament, called a halt to

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Westpac drops a clanger (updated)

This blogger will analyse at greater depth the new Westpac bubble-busting report soon. For now however, here is one spectacular quote that finally confesses the truth about Australian banks’ new role as wards of the Australian state. There is no need to hide it anymore, they own us: External shocks are potentially more problematic. A

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Grantham responds

Global bubble maestro, Jeremy Grantham has responded to the deluge of criticism coming from such housing interests as CBA and Christopher Joye. Here is the money extract and full newsletter below: I happily concede that the U.K. and Australian housing events are not your usual bubbles. Australia, though, does pass one bubble test spectacularly: we

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Corporate dissonance

According to Elisabeth Knight at the SMH: If BHP’s management is to be criticised for this offer it should be on the basis of potentially under- estimating the political backlash from the Canadians. It is too early to make that call, given the final adjudication has not yet been made. BHP knows from recent experience

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…Sell the fact

If you value your sanity, don’t listen to the day-to-day drivel of market prices. Markets are down because the WSJ has published a story, rumoured to be leaked form the Fed, describing the new QE program. Here’s the money quote: Unlike in March 2009, when the Fed laid out a program to buy $1.75 trillion

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Thursday October 28: Buy the rumour…

The QEII plan. WSJBernanke’s backflip. QEII little. Tim DuyBuy the rumour, sell the fact. BloombergOrwell’s curse: G20 resumes currency war. BloombergFT disagrees. FTNaked Capitalism disagrees with FT. Naked Capitalism Wall St’s new gambling model. Michael LewisMortgage insurance bailout. Chris WhalenGreece sick! BloombergWhy does The OZ persist with Frank Gelber?Nick Xenophon approves senate bank enquiry. BSAre

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Queensland, Chicken or Egg in the basket[case]

We note today that Queensland’s troubles are slowly getting worse. QUEENSLAND’S economy is taking over from NSW as Australia’s basket case.Its property markets are weak, it has lingering financial problems from the GFC and its tourism industry is depressed by the rising value of the dollar. Julia Gillard’s aptly dubbed “patchwork” economy looks nothing like

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Slow Australia (not for the faint of heart)

Today’s links have a range of pieces discussing China’s development model and its possible slowdown. In the Reuters’ piece, a range of analysts describe the middle-income trap awaiting China. That is the historical phenomenon of developing economy growth stagnating once average incomes hit the $7000 range. Here’s the money quote from the piece: According to

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BHP digs us a hole

Don’t say this blog didn’t warn you. From the SMH today, BHP’s Potash bid is in deep trouble: Saskatchewan’s premier said Australia wouldn’t approve of BHP Billiton’s foreign takeover of Potash Corp and Canada shouldn’t either. Premier Brad Wall continued to step up the pressure to make sure Canada’s federal government blocks what would be

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Links October 27: Slow China

China to slow to 8% growth forever. ReutersSame topic but less convincing. Zero HedgeOne man, one vote in China. Gideon RachmanChina versus Japan vis. internal rebalancing. Michael PettisMervyn King: break up the banks. TelegraphAnd some distance to the rear, Peter Martin says Hockey is right. Chewing on his dust, Jessica Irvine sort of agrees.American house

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Another example of Queenslands’ troubles.

We have just been informed of another example of the collapse of property prices in Queensland that demonstrates the issues we have been talking about for a long time. This 6 bedder was listed at 1.9 Million, but only managed 1.4 million (26% discount) at an auction last weekend. The only problem is that it

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Captain Glenn isn’t saying No.

In what has to be a very worrying article for the roll-over states, Captain Glenn refuses to talk down his need to raise interest rates in the coming months, as costs for business rise much higher than expected. The governor of the Reserve Bank has done little to hose down speculation of an interest rate

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Young Economists are Westpacing.

To keep a promise to a fellow econoblogger we must mention an appointment coming up on our calendar. The young economists of Brisbane are once again inviting all interested parties to enjoy a lunch and listen to an economic leader. This time it is Ted Evans from Westpac. Given the current situation in Oz banking

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Don’t forget New Zealand

Since beginning this blog in May, I have received a lot of traffic from New Zealand and have even had some of my articles on the Australian housing market reported in the New Zealand mainstream media (for example, see here). So after writing articles on the Chinese, Canadian and US housing markets, I figure that a detailed examination

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It’s called systemic risk

Today a couple of readers have sent us some more information about oversupply. It seems that the oversupply of houses is turning up all over the place. (Hat tip to Brandon and Kara for the story about perth) The idea that there is a housing shortage in Perth has been shot down by a leading

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Last redoubt of the cowboy capitalists

Der Spiegel published a brilliant study of the current pricing dynamics in the copper market this week. It is a fascinating and terrifying glimpse of the evolution of global capital’s shiny new bubble: metals. From the piece: In Manhattan, only one block from Ground Zero, 12 men are sitting at a round table in a

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No Joe (updated)

Here’s a scorecard for Joe Hockey’s nine point plan on bank re-regulation. This blogger can see why the Australian Bankers Association responded positively. Not much to fear here. 1. Let’s give the ACCC power to investigate collusive price signalling (that is, oligopolistic behaviour), which is exactly what Graeme Samuel has called for. H&H: And what’s

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Links October 26: Commerce not capital

Joe’s nine point plan to nowhere. Joe HockeyWhat copper can tell us about the dollar. Der SpeigelWhy capital controls rock. FTNYC as a microcosm of ForeclsoureGate. Naked CapitalismBill Black as a macrocosm of ForeclosureGate. MSNBCToo small the stimulus. Paul KrugmanUS housing inventory. Calculated RiskResentments between the rising and falling. FTSoft bids for ore. Reuters

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Howard and shoes.

What a shame !! ….. he missed. However John Howard’s publisher just took another order for 10,000 books. Disclaimer: The content on this blog is the opinion of the author only and should not be taken as investment advice. All site content, including advertisements, shall not be construed as a recommendation, no matter how much

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Non-Enrolment contagion

A couple of weeks ago we talked about the fact that tertiary enrolments, especially from India, were collapsing. Today we note that crickey has an article that non-enrolment is spreading. Students from India constitute the second biggest group of foreign fee-payers in Australian higher education but are still well behind those from China. In August,

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The US banks tried to play it down..

.. But the problem just keeps getting bigger. Thousands of foreclosures across the city [New York] are in question because paperwork used to justify the seizure of homes is riddled with flaws, a Daily News probe has found. Banks have suspended some 4,450 foreclosures in all five boroughs because of paperwork problems like missing and

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Queenslands’ perfect storm

As our readers would be well aware , Queensland is the Miami or California of the Australian property market. It is the canary in the coal mine, and the poor little bugger is choking on fumes. Today we note that the perfect storm has formed around the cage. Melbourne and Brisbane have closed the gap

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Not Macfarlane

The more things change the more they stay the same. From the SMH: The shadow treasurer, Joe Hockey, will call for an inquiry into the banking system today with the National Australia Bank, Westpac and the ANZ all expected to reveal record profits. In an address to the Australian Industry Group entitled ”It’s time to

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American housing resumes its crash

Those who believe that the danger of a double-dip recession has passed should take pause today to register an American housing market plunging with renewed vigor. As Calculated Risk reported over the weekend: Clear Capital™ Reports Sudden and Dramatic Drop in U.S. Home Prices “Clear Capital’s latest data through October 22 shows even more pronounced

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If Vic is the goose then Qld isn’t the gander

We note over the weekend that Victoria had it Super Saturday auctions and, although once again the clearance rates quoted by many in the industry fails the basic maths test, we can see that there are still many people inside the Victorian economic envelope willing to pay ever increasing prices for housing. HOME buyers were

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Services won’t save us

Two pieces today give you the bitter flavour of what is ahead for Australian exports. The first is a spot-on diatribe by Martin Feil at The Age. ACCORDING to many pundits and politicians, expanding the Australian services sector is the correct (if not the only) long-term strategic direction for the Australian economy. We have completely

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One honest man

So the G20 isn’t going to engage in the currency war that’s already raging. The US wants a “strong dollar” and China “market-determined exchange rates”. All countries are going to consider the Geithner imbalances plan already rejected. Is it this blog or did the G20 just hit new heights of Orwellian double-speak? Anyway, came across

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Links Oct 25: Services will save us!

Services no answer to Dutch Disease. Martin Feil CEOs won’t invest overseas despite high dollar. BloombergUS house prices resume their plunge. Calculated RiskThat’s before ForeclosureGate hits the market. FTMarket is about…oh…halfway down. CNBCForeclosureGate: Unimaginable amount of litigation. NYTFitch prepares downgrade for Wall St on Volcker. Zero HedgeG20’s Sino kiss: Imbalance paralysis, new IMF powers. FT,