Links Oct 13: BW2 RIP

The end of BW2. Tim DuyMisplaced faith in the Fed. David RosenbergBan these now. WSJGlobal bank resolution hits a hurdle. FTChina snubs Norway. Pleasant, our new friend. FTThreats to BHP’s Potash bid. Matthew StevensProductivity versus aging. Peter Van OnselenGoldman raises gold target. Sell. Zero HedgeWill Wall St pull a Mac Bank? ForbesOre price ramp established.

Latest posts


It’s all good!

Here’s today’s breathless piece of drivel. From Simon Johanson of the SMH: House prices will continue to grow by up to 20 per cent over the next three years despite interest rates hitting a peak of 9.1 per cent, a respected business forecaster said today. A QBE Housing Outlook 2010-2013 survey compiled by BIS Shrapnel


Houses and holes

This blogger sees economies in three categories. There are pre-modern economies which produce largely commodity output. There are modern economies which produce knowledge and manufacturing output. And there are post-modern economies that produce nothing but huge numbers of transactions around assets and business services (especially the financial variety). Australia used to have a balance of


US Housing Market: From Bad to Diabolical

We all know that the US housing market is in bad shape. Following the onset of the sub-prime turned ‘Global Financial Crisis’ (GFC), US house prices have tanked to be near their long-run trend: Some markets where supply restrictions were present – most notably California, Nevada and Florida – have fallen hardest, whereas those with liberal land


Links Oct 12: More Foreclosuregate

Banks react to Foreclosuregate. Naked Capitalism I, II, IIINot for the faint of heart. Chris Whalen (missed these) I, IIWill it freeze the housing market? BloombergYes, it will. The Whisperer (h/t Unconventional Economist) Suggested solutions. Oh my… Felix Salmon And, bugger me, some mainstream Australian coverage. Adele FergusonSwiss take bank regulation seriously. EconomistBut it’s all


OZ Real estate .. Still floating southward

The ABS released the finance data for housing today. The usual spin doctors are attempting to make the best of it but in reality it isn’t good news, for starters there is this. Total housing finance by value fell by 1.3 per cent in August, seasonally adjusted, to $20.147 billion. However the real damage is



From this morning’s SMH comes a report about developments in a less well known dimension of the great Australian bank bailout, the securitisation market: REGIONAL banks and other small lenders have begun talks with the Gillard government seeking a third extension to the $16 billion residential mortgage-backed securitisation program that forms a key funding support


Links Oct 11: Decoupling my butt

Decoupling my butt. David Uren, Dani RodrickChina property bubble deflating. Andie Xie40 US states going after foreclosure data. NYTWho’s to blame for Foreclosuregate? Stephen PearlsteinRobert Reich on GFC aftershock. Jesse’s Cafe AmercainWeek ahead of the Dow. Calculated RiskSmall banks go the handout. SMH


The US housing dirty bomb.

Well it has been a big weekend of reading. The US foreclosure-gate issue has more tentacles that an ambidextrous squid. As we said in our last post this problem involves many different organisations. We had a look around a couple of Oz trading forums late last night ( ones that had links into our post


2008 redux (updated)

I won’t make a habit of posting on weekends but this is important. Grain markets are dislocating upwards. Oil has surged 14% in two weeks. The Aussie is threatening parity. Gold is rocketing to new highs. Everyone is on one side of the emerging markets trade. The Dow is powering on easy money. BHP is


Weekend reading: Black Swan 2.0

Foreclosuregate: What is it? Zero HedgeThe banks’ immediate problem. Karl DennigerThe bigger problem. Chris WhalenAnd how it will freeze markets. Felix SalmonThe MERS monster. FT AlphavilleThe effect on home sales. NYTThe pain and the progress. Janet Tavakoli Other stuffAlcoa earnings bullish for commodities. Money GameShocking US employment report. Calculated RiskSoros does China. George SorosMapping the


Ric goes bear.. Pop Pop Pop.

In a very interesting turn around, RBA deputy Ric “housing bull” Battelino has suddenly decided that housing prices in OZ will be “stagnant” for a while and this is a good final outcome. The Reserve Bank has poured cold water on the hopes of anyone looking to make money out of increasing house prices. In


Unpleasant scenarios

The blowoff in gold and oil must mean that we are rapidly approaching the zenith of this charming QE2 rally, which has morphed swiftly into outright currency war. Helicopter Ben is now completely boxed in by the stock market which has rightly interpreted his Jackson Hole pledge to print money “if” needed as a rock


Links Oct 8: Currency chaos

More join the currency war. BloombergWhere the US takes it next. Robert ReichCurrency volumes explode. Reformed BrokerIMF: no mood for accords. BloombergDutch Disease alert. But that’s ok because we’re making “space for those parts that have to grow over the next 12 months or so”. Bloody hell. We need a new tradable goods peak body


Where did all those people go ?

Today we note that population growth in Australia is taking large revisions downwards. IMMIGRATION numbers are falling fast as overseas students continue to abandon Australia. Australian Bureau of Statistics figures released yesterday showed net immigration for the year ending March 31 was 241,400, 25 per cent lower than the 320,400 recorded for the year ending


Busy Day.. Only time for some links

Pimco follows everyone else with a vested interest to decide there is no bubble in Oz housing. This is getting so repetitive , We will leave it up to the comments to tell you the truth because we are bored with this moot argument Morgan says the CBA will attempt a “customer bird” soon. IMF


One chart to rule them all (updated)

After this blog’s recent Housing Velocity post, in which a comparison was made between total housing turnover and population growth, reader Torchwood1979 made the eminently sensible suggestion that we strip dwelling commencements from the figures and see what happens. Well, here it is: Established dwelling sales from 1991 to 2009 in major Australian states. One


Links Oct 7: Bulls versus bears

Correlation bubble. FT AlphavilleMore like everything pricing for QE2. Zero HedgeADP tank signals QE2 ahead. EconompicGoldman says buy Euro. Sell it. Zero HedgeDow overbought. PragCapWanna be right or make money? Barry RitholzThat definitely looks like a cup and handle on the ore chart. BloombergMatched by another little one on the Baltic Dry.And more. BloombergSwift revaluation


Admirals of Banks declaring war.

Until recently the only banking Admiral willing to come out with his middle finger in the air at his customers while saluting his shareholders was CBA chief executive Ralph Norris. Today we note, probably to the joy of the RBA, that others have stated they want in on the party. ANZ chief executive Mike Smith


Reserve Bank of Lilliput

Delusional Economics does a nice hatchet job on comments by RBA boffin Luci Ellis about the housing bubble. Sadly, however, there is more to dismember on the currency front. From Business Day: Reserve Bank of Australia (RBA) Head of Financial Stability Luci Ellis says the poor strength of the US dollar is no surprise, given


Links Oct 6: Rates fallout

McCrann not wrong, RBA “confused”. Terry McCrannBig banks will raise unilaterally soon. John DurieJapan prints and buys the lot. FT AlphavilleUS-China trade war will only benefit Vietnam. NBOUS double dip still on. Rosenberg at PragCapStimulate the US. George SorosUS services grow. EconompicThe BHP/Rio zombie is dead. Der. SMHIs that a cup and handle formation in


Egg all round

Yes, and some of it on this blog’s face. Though it did at least take the Joye/McCrann drivel to task. Both the RBA and the banks have suddenly backed off on rate rises (at least for mortgages). This blog can’t figure out if this is a wildly bullish or bearish signal. Probably neither. For clues,


Happy Gouging Day

Another month over, another RBA meeting to decide the interest rate. The odds seems to be somewhere between 60% and 70% for a 25 bps rise, which should keep the AUD forex traders happy for a little bit longer. Given the mad frenzy of “anti rise” media over the last week it seems the Real


Take it for the team (Updated)

This blog does not have a great deal of sympathy for complaints about bank gouging when it comes to interest rates. The reason is simple. If a nation wants to run a housing bubble based upon foreign borrowing then it should accept the logical consequences – that sooner or later competition will collapse around too-big-to-fail