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Hats off to a real banker

The SMH reports that today the chairman of Adelaide/Bendigo Bank Robert Johnon has called for a new Inquiry into banking: Bendigo and Adelaide Bank Ltd has called for another parliamentary inquiry into Australia’s financial system to address the banking system’s reliance on offshore funding. Bank chairman Robert Johanson told shareholders he hoped the Senate’s inquiry

Latest posts

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The death of housing

For many years this blogger has tracked the great Australian housing bubble with increasing incredulity. It eventually concluded that is was so vast, so institutionalised and so vital to the savings of the middle class that the bubble was only going to burst when all of its many supports faced no available choice to keep

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On their knees

If you want to understand how and why the Australian banks can flip the bird at the nation with impunity, you need look no further than the pathetic response of the senior commentators of the fourth estate. Their combined lack of imagination, curiosity, intellect and, above all, cohones, is the banks impunity. Responses vary from

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Links November 3: Bank bashing, my butt

Piss weak bank fallout. Tim Colebatch, Peter Martin, Elizabeth Knight, Matthew Stevens, Michael Stutchbury, Stephen Bartholomeusz, Lenore Taylor, Rob Burgess.QEII risks end of the dollar. Ambrose Evans-Pritchard PIGS on a spit. Calculated Risk, EurointelligenceIreland bailed out in a month. Businessweek.No currency war here, pffft. EconompicHow China can win it. ReutersPotashCorp in the bag? SMHManufacturing leading

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Happy gouging day.. Again

Last month we decided it was gouging day. We got it wrong because the RBA didn’t move; however this month they did. We were a month early on our call, but the effect is much the same. We knew as soon as the RBA did move that the banks would pile on the additional bps.

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0 for 3 and the fallout

Well … this blog has lost its interest rate touch, that’s for sure. It has now blown it two months in a row and underestimated the banks to boot. As a contrarian it should have known better than to bet with the pack. The statement on monetary policy is kind of interesting. It meanders through

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Today’s tips

Macro-economically – RBA to hold Micro-economically Shocking Americain Descarado We expect to be at least 100% wrong. 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 it

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Canada right to rebuff BHP

As a liberal and believer in functional markets, this blog reckons that from time-to-time it is necessary for policy to shape appropriate competition. Australia has always prided itself on “punching above its diplomatic weight”. The narrative of Australian foreign affairs is littered with this interpretation of the twentieth century. Some have interpreted this as a

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Links November 2: The China punt

The China question. John GarnautChina’s property plateau. Money Game h/t Naked CapitalismChina exporters upset already. Washington PostChina’s aging to slow growth dramatically. BloombergBut not yet. PragCapPotashCorp slipping away. FT, BloombergMore Dutch Disease for tourism & manufacturing.Zombie ideas. John QuigginCup and handle exhausted in BDI. BDIWhy the RBA should raise rates. Henry ThorntonThe future of iron:

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Property delusion on tour.

We note that Australians near religious love affair with housing is sending them off to foreign shores, delusion in hand. “America represents an opportunity, and Australians have just jumped all over it,” said Andrew Allen, founder of My USA Property, who was leading the tour. Allen’s firm, which has an office in Orlando, Fla., brokers

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The "P" in PIIGS joins in.

We note today that after a little argy bargy Portugal has joined its other friends in the economic delusion club by finally initiating an Austerity budget. Portugal’s government and biggest opposition party agreed to let next year’s budget pass in a vote this week, aiming to stem the euro region’s fourth-biggest fiscal shortfall with cuts

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Another day.. Another set of random housing numbers.

It seems that the ASX can give you a completely up to the minute answer on exactly what is happening with every stock and the value of the listed companies on the stock exchange even though the values change every millisecond. When it comes to housing the values do not change anywhere near as often,

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Three financialisations

This post arose from today’s assessment of the September credit aggregate statistics. As noted in the post, lending is still a mix of consumer strength and business weakness. From a longer run perspective, this blogger is interested in this ongoing divergence because it reinforces an historic trend toward consumer lending, completely dominated by mortgages, and

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Wallis on, Wallis off

Alan Kohler offers a confused take on the prospect of a new Wallis inquiry today. First, he argues rightly that: The big problem lies not with the banks and “collusive price signalling” as Joe Hockey calls it, but with the refusal of politicians to acknowledge that 40 per cent of bank funding comes from offshore.

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No rate rise here…

RBA September credit aggregates are out and the results are sluggish in their terms. Credit growth is still a mix of moderate consumer strength and business weakness. Owner-occupier mortgages were up 7% annualised and investors 7.8% for total mortgage credit growth of 7.3%. This blogger has noted before that, owing to the vast distortions in

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Links November 1: Rates week

Why inflation will stay low. David UrenBank gouging (a MUST read). Milind SathyeRaw edge of the boom. Michael StutchburyBretton Woods 2 and the G20. Simon JohnsonSure you can have austerity, just don’t expect growth. EconospeakWeek ahead for the DOW. Calculated RiskBring the shareholder revolution on. The Age$US begins to climb. Zero HedgeNot happy, Japan, China.

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End of Month Stats

Another month disappears, so it is time for some stats. As you can see the readership continues to grow at a healthy and rather surreal rate. Thanks all for reading along with the daily rants, and thank you to all the contributors. Disclaimer: The content on this blog is the opinion of the author only

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Weekend Mailbag

We have had a couple more e-mails this week worth sharing with our readers.In response to a message in last week’s mailbag we said. The banks swap nearly all (or, at least, the bulk of) their non-AUD offshore borrowings into Aussie dollars using currency swap derivatives. The effect is no, or very limited, currency risk.

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Weekend Reading

US economy growing at 2%, below pre-recession level. Calculated RiskStill riding inventories. David RosenbergConsumers still in funk. PMI not. Zero Hedge I, IIForeclosureGate now hitting sales. BloombergWhy this US cycle is different. EconompicChina dependency index. The EconomistChina overstretched, overvalued. FTClancy Yates is wrong on bank competition. Terry McCrann thinks we don’t get it about China.

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What is the sound of popping ?

What is the sound of popping? Well today it is the sound of an industry leader shooting themselves in the head. In the continuing story of the implosion of the Australian Real estate market, it is now getting so bad in Tasmanian that the head of the Real estate industry has decided the best way

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Royally, globally, screwed…

Australian dollar versus the US dollar: Flash Player 9 or higher is required to view the chartClick here to download Flash Player now View the full FOREX:AUDUSD chart at Wikinvest And the Korean Won: Flash Player 9 or higher is required to view the chartClick here to download Flash Player now View the full FOREX:AUDKRW

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Links October 29: Dollar shocker

IMF endorses this blog: dollar overvalued, need giant RSPT. The AgeChina’s growing costs. Gavyn DaviesForclosureGate linkfest. Barry RitholzEuropean schlerosis: FT, WSJ, Alphaville (h/t Naked Capitalism) See also Delusional EconomicsBond bull death. Econompic, Calculated RiskEnd of the Wen put. William PesekMr Smith goes to Canberra. Peter Martin Eeeuuuw. And for a more sickening take. Matthew StevensVale’s

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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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Congratulations you are our 100,000th visitor

Today we reached a milestone. It is our 100,000th page impression, and someone from St George Bank was the lucky winner. Windows XP and IE6, is it really that bad at St George ?? Disclaimer: The content on this blog is the opinion of the author only and should not be taken as investment advice.