Weekly market analysis

Australian Market Summary The S&P/ASX200 index closed the week at 4852 points, slipping a further 0.66% on Friday, going down for the fourth day in a row. Overnight action in the US and EU supports a theory that this is just a dip, with the Dow rallying almost 0.5% and the FTSE 100 up over

Latest posts


I want my nanny (state)

Cameron Murray is a blogger that many of the MacroBusiness readers may have read previously. He has a blog called Observations of an Environmental Economist which I followed until Cameron announced his retirement from blogging last year. I have always enjoyed his blog because it presents some refreshing views on a number of topics and


Hooked on property

In January this year, I published the below HIA chart and accused Australia’s governments of being ponzi merchants for attempting to keep the Great Australian Housing Bubble alive by pumping demand and restricting supply in order to preserve government finances. Now RP Data has confirmed my suspicions with a fantastic piece of research entitled Property


Endless regress

My estimable co-blogger Delusional Economics showed he was anything but delusional with his penetrating commentary on economics as an ideology (Economic Ideologies). It is a point made all too rarely. That economics purports to be an unbiased way of understanding financial and commercial behaviour when it is in fact riven with political assumptions and beliefs.


Australian dollar weekly wrap

The Aussie’s price action once again speaks of underlying demand and overall strength even if it wasn’t able to eclipse or close above last week’s highs. Opening the week near the highs, the AUD traded down to a low a little below 1.04 on the back of what was widely reported to be a bit


CDS: More liquidity, more risk

By Satyajit Das In an opinion piece entitled “Hedging bans risk pushing up debt costs” published on 9 March 2011 in the Financial Times, Conrad Voldstad, the chief executive of the International Swaps and Derivatives Association (“ISDA”) and formerly a senior derivatives banker with JP Morgan and Merrill Lynch, made the case against the EU


Weekend Links: Budget crumble

DE here. Charts: Gold, Silver up and Platinum flat Oil up. Bloomberg Copper down Aussie still up, when will it end !! Ore Down Grains Mixed Greece to default? Bloomberg as I said yesterday “Whatever the German guy said” And yet another great Euro austerity story – Ireland with a Moody’s downgrade WSJ NATO quibbling over


The Leighton debacle

I was doing some quick lunch time reading of the various Leighton’s (LEI) press releases that have hit the market recently.  For those who have been living on Mars inside a cave, LEI announced a $700M+ turnaround in profit for FY11 – to come in at a forecasted loss of $427M.  Ouch.   The horrible


Trading Day: 15th April

Note: anything in quotation marks is a reference to yesterday’s or earlier notes that I’ve made. These comments are read in context of an investor/trader with a medium term timeframe. S&P/ASX200 Index – XJO The S&P/ASX200 is down 16 points to 4867. The market is hovering above its 15 day moving average and slowly decelerating.



The phrase UnAustralian has long resonated deeply with the bogan. The bogan knows that it is Australian; indeed, the best kind of Australian. Anyone who disagrees with things the bogan likes is therefore not Australian. QED. However, something has occurred this week that gives us pause, as we consider the possible death of one of


Car sales pop

Yesterday one of our more bullish commenters (BK) asked us what we thought of yesterday’s car sales. It’s not usually something we track but it probably should be so thanks for the question and here it is. First from the ABS: I always work in seasonally adjusted figures (unlike DE). The overall result here looks


Planet McCrann

My comments in this column are not deliberately trying to be political. In fact, I am trying to be apolitical: I see carbon pricing as an economic issue. However, I realise that this issue is so divisive that it has become impossible to comment on carbon without being seen as making political comment. That is


China’s leading indicators

Here’s a heads up about the important Chinese data that is out around lunchtime today.  Amongst the raft of data to be released is the GDP data. Chinese growth is increasingly important to everyone on the planet as our beloved Central Bank Governor pointed out in New York two nights ago. The chart below shows the


Links 15 April: Ups and downs

DE here. Charts: Gold, Silver and Platinum all Up Oil Up. Bloomberg More Shiny stuff Up metals Aussie Up ore Up too grains Down. US jobless claims up Calculated Risk Goldman Sachs Misled Congress After Duping Clients Bloomberg More Greek restructure talk Reuters here is why Chart If the German guy said it, then it is going to happen Reuters Japanese PM


Moody’s downgrades China’s property sector

Just in, credit rating agency, Moody’s Investor Services, has downgraded China’s property sector to negative from stable, citing both falling property sales and prices [my emphasis]: Hong Kong, April 14, 2011 — In a new report, Moody’s Investors Service changes its outlook for the China property sector to negative from stable. The change reflects the


World equities champion!

Australia is the best performing equity market in the world over the past century according to a Bloomberg story. I confess I would never have thought this but given the claim has been made by the London Business School and Credit Suisse I guess it has some credibility. If this is truly the case, it begs


More tunnel trouble

In a follow up to a story I posted about the failed Clem7 tunnel in Brisbane, it looks like some of the aspects of the story I mentioned have still got some legs. Less than two months after the spectacular collapse of listed toll road operator RiverCity Motorways, its traffic modelling forecaster Aecom faces a


BoQ trouble

Well, I warned you a couple of times about  Queensland Banks. Bank of Queensland has been able to hold its interim dividend steady even as the regional lender’s first-half cash profit slumped 41 per cent after being pummelled by a surge in lending losses related to Queensland’s floods and cyclones. At the same time, Bank


Trading Day: 14th April

Note: anything in quotation marks is a reference to yesterday’s or earlier notes that I’ve made. S&P/ASX200 Index – XJO The S&P/ASX200 is down 44 points to 4867. Leighton (LEI) is weighing on the market after plunging 15% on the open. I see nearly a wall of red on my quote screen. The market is


Just holes

It may have passed Craig James by, but a few brokers are starting to wake up to the obvious. That the Australian economy is being permanently altered by the mining boom and the impact of China. It will inevitably bias the stock market towards resources. No houses, just holes. A report by Southern Cross arrives


Changing Behaviour

The price elasticity of household electricity demand is quite low, around -0.1, meaning that a 20% increase in price leads to a 2% reduction in demand. The addition of a carbon price into the cost of electricity is unlikely to have much impact on consumption unless carbon prices were to be very high. You might


Glenn Stevens in full flight

Grab a coffee and read the following speech given by Glenn Stevens overnight. I could nit-pick a  few things but basically it’s a cracker.  America, Australia, Asia and the World Economy Glenn Stevens Governor Address to the American Australian Association 2011 Annual Spring Lecture Lunch New York – 14 April 2011 Thank you for the invitation


Bulls are in charge as the bears hibernate

Risk markets look like completing their “dip” overnight, with the US markets up slightly (NASDAQ up 0.6%), Euro markets up strong from 0.36% (Italian) to over 1% (German DAX) and our own market up 0.25% through to the Hang Seng (HK) up 0.66%. As I mentioned in a recent post, dips occur within rallies, and


Don’t spare the horses, James

There’s a piece today by Peter Martin and Phillip Wen in the Fairfax press about how: Australians are richer than ever, paying off debt at an unprecedented rate – but still losing confidence in the economy. New figures show wealth per person climbed to a record high of $266,600 at the end of December, easily


Beijing down 29% ?

On new years day of this year the Chinese government announced that it had a new plan for housing China’s central government will strengthen its campaign to control soaring housing prices in 2011, a senior official said on Wednesday. Minister of Housing and Urban-Rural Development Jiang Weixin told a national work conference that the government will


April 14 Links: Flat

DE still here, but these 5am starts are killin’ me 🙂 Charts: Gold, Silver and Platinum all Flat Oil Up. Bloomberg More Shiny stuff flat metals Aussie Up ore Flat too grains mixed. Obama announces his version of Austerity Bloomberg US economy slowy improving Bloomberg But still no one wants a house JPMorgan Up on “book fiddling” but signs of


Economic ideologies

There is common thread across modern economics. Not something that is useful. It is the fact that no one really seems to know what the hell is going on. Yes there are some people who are seen as “prophets”, depending on your ideology they may be anyone from Mr Buffet to Mr Kaiser. But economics


Petrol and consumers

In his earlier review  of the Westpac Consumer Confidence Survey, H&H commented that Australians are feeling poorer even as the country gets richer. The chart above graphs the answer to the question of how consumers in the Westpac survey feel their family finances are going to be 12 months hence. It’s the pink line which


Australian dollar pull back

Market commentary is always slanted towards prices moving higher (leaving interest rates aside) on the understanding that up is good and down is bad. Makes sense, most people play it from the long not the short side. So last night’s price falls across a broad range of equities and commodities has investors and traders on