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Lucky they’ve got the government

Real estate agent watching is becoming a bit of a sport in Queensland. As the market turns the level of desperation is slowly rising. I get quite a few e-mails from readers informing me of their local agents antics. It may surprise you just how much your local agent knows about macroeconomics, microeconomics, forex markets,

Latest posts

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Swannie Mac

Hot from the office of the Treasuer:  More Support for a Competitive Lending Market Today I announce that I have directed the Australian Office of Financial Management (AOFM) to invest a further $4 billion in high-quality, AAA-rated Australian residential mortgage-backed securities (RMBS) to help smaller lenders continue to offer competitive loans to families and small

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Weekly Markets Analysis: 8th April

Lots of charts to look at today, first the usual fractal look at the Australian market, and then a quick look at the major components of my “Crashlist”. This is a select list of equity, FX and PM markets that I watch each evening as they open and analyse each morning before the Australian market

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Donkey, thoroughbred marry

On Monday, at an Extraordinary General Meeting, Western Australian Newspaper (WAN) shareholders will likely approve the purchase of Seven Media Group (SMG) for $4.1 billion. The Seven Group forms part of SVM, which consists of the Seven Group and Westrac (a heavy machinery servicing group).  Aside from the free-to-air (FTA) channels 7, 7two and 7mate,

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The underemployment question

Yesterday’s strong employment numbers from the ABS stoked an interesting debate in the comments about what degree of underemployment Australia suffers. To help the debate along I’ve drawn up the following table from the ABS Underemployed Workers report. It is annual only and from Spetember 2010 It clearly shows two things. First, that labour markets in

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Cyrano de Boganac

During the week, Woolworths announced that its CEO, Michael Luscombe, was stepping down in favour of some fresh blood in Grant O’Brien. The local media, desperate to get into a flurry over something other than Kevin Rudd telling the country what it already knew, began flailing wildly for an angle, settling on one of two

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The mad, bad commodity rally

There’s something wrong with this rally. To be honest, beyond some vague notion of Japanese reconstruction demand, I can’t find any real cause for it. With China clearly not done with tightening, QE2 about to cease, the ECB hiking rates, global growth past its prime and oil punching through $1.10 on Gaddafi’s scorched earth policy,

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Picking winners

A few commentators to my Picking Losers blog earlier in the week quite rightly pointed out the potential for gas-fired CCGT plant to be a sensible baseload replacement for brown coal-fired power. I have looked at the numbers, and agree. Taking the cost of new gas CCGT at around $1million per MW, replacing 6GW of

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April 8 links: Commodity peak

Dear reader, I’ll being going off grid for the next week. Links will be still be available, compiled by Delusional Economics. I’ll still be posting but probably not in the morning’s. Back soon. David Rockets: ore, metals, energy. Up: Aussie. Down: grains. Flat: $US Commodity inflation hitting US expectations. Bloomberg Core Logic registers new plunge in US housing. Calculated Risk These are

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Tax stats unmask investors

The 2008-09 Australian Taxation Office (ATO) Taxation Statistics were released yesterday (available here), and the data on property investment was very interesting. First, the number of property investors reporting to the ATO fell by 34,000 or 2% from the previous year (see below chart). Second, after rising steadily since 1999-00, the overall value of net

1

Small is beautiful

Analysts’ resources and attention mostly goes on the top 50 stocks, because they are liquid, institutions like them because they can defend their decisions, and brokers can sell their research more easily. It leads to an unhealthy relationship between the fund managers overseeing super funds and the big cartels. Cosy, comfortable, often compromised. For investors

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Hollowing out

Washington Consensus and Dutch Disease – yesterday saw an interesting convergence of these two ideas which are vitally important to the debate, or lack thereof about the structure of the Australian economy and the changes being wrought by mining and the high Australian dollar. Briefly, the Washington Consensus was the set of “rules” which replaced

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Will the RBA cut?

Right now, the economy is far weaker than media and bank economist blather is letting on, or understands. For that matter it’s far more weak than global markets are assuming. The reason is simple and goes back to a piece I wrote ten weeks ago: So, let’s take a closer look at where we are

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March 7 links: A QE timeline

Rockets: ore, metals, Aussie. Mixed: grains. Flat: energy. Down: $US A QE timeline. Calculated Risk Must read QE and commodities. Alphaville QE and commodities II. Alphaville More hawkish rhetoric. Tim Duy The US natural gas boon. Carpe Diem Global economy slowing. PragCap Waiting for the great rebalancing. Martin Wolf Maiden wakes up. SMH Port Douglas fire sale. The Oz Ore market dynamics. Reuters

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AFG – Mortgages bouncing in March

February’s data for housing was obviously terrible. However if we can take AFG’s latest report on mortgage issuance for March the market may still have a bit of a run left in it. Well at least in NSW. Mortgage sales during March saw a recovery from the record lows of January and February, but figures were

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SQM Research on the housing finance data

As my fellow MacroBusiness bloggers have already pointed out, Australia’s housing finance data released today by the ABS was bad, real bad. One of Australia’s few truely independent property analysts, the Managing Director of SQM Research, Louis Christopher, offered perhaps the most damning assessment via a series of Tweets: Home loans drop on weak demand

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It’s still 2008

As H&H reported today the housing finance data for February is simply plain bad. This is not a surprise to me as I have been warning about this for some time now. As I have been saying recently I simply could not see any drivers for new credit and it looks like I was correct

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Housing finance shocker

The drumbeat of crappy housing data is getting louder and more frequent. From the ABS February Housing Finance we get the following: Here are a string of graphs to give you a feel for how bad the trends are: I call them bad, yuk, crap and foul. And here’s one last one to drive home the

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Priced in

The Australian market’s S&P/ASX 200 only rallied 1% in the first three months of the year, compared with 5.4% for the S&P 500 in America. With the $A seemingly headed to $1.10, foreign investors, abut two fifths of the market, are likely to get nervous, and the strengths of the Australian market are probably priced

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Troubles with Fund Management – An Absolute Return View

This is a reply to Rotten Apple’s post about the “trouble” with the Australian fund management industry. The author of this article is a co-founder of an Australian-based private investment company, Empire Investing, and a former financial adviser and portfolio manager for a boutique financial services company. It’s all Absolutely Relative
 Let me start with

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Golden rocket

As gold again surged to record highs last night on dovish Bernanke comments and weak data, it’s time to revisit the rally. I first began recommending gold to anyone that would listen in early 2001. I was laughed at. Later that year, my friends laughed at me again. This time, it was a running joke

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Let’s get real

There’s a notion going around that an Australian carbon tax will raise more tax in its first three months than the EU ETS has generated in six years. Mr Seamus French’s column in The Australian on Monday included this idea. No numbers have been put forward to justify this assertion, and it can’t go unchallenged.

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April 6 links: No dice

Rockets: metals. Mixed: grains. Flat: energy, ore. Down: Aussie, $US. Foreigners snapping up Treasuries. Bloomberg Basel III way too soft. Economics Intelligence (h/t Naked Capitalism) No early exit from QE2. Calculated Risk, Tim Duy No inflation says Bernanke. Bloomberg CDOs are back. WSJ Services ISM peaks. Calculated Risk Fukushima radiation off the charts. NHK China raises interest rates again. Bloomberg

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Hong Kong’s housing headed for a crash?

This years Demographia International Housing Affordability Survey ranked Hong Kong as the most unaffordable housing market out of the seven countries surveyed, with median home prices a whopping 11.4 times incomes. After falling some 23% over 6 months in the wake of the global financial crisis, Hong Kong’s housing market has been on a tear,

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The line moves closer

The latest NAB “survey” of vested interests on what they hope is going to happen to the housing market is out as reported in yahoo finance. Even though it would seem that the chief of the bank has given up on housing others still seem to want to find the glass half full. Survey Highlights:

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Canberra please read: Roubini calls time on China

From Nouriel Roubini at RGE Monitor: I’m writing on the heels of two trips to China during which I met with senior policy makers, bank executives and academics, just as the government launched its 12th Five-Year Plan, intended to rebalance the long-term growth model. My meetings deepened my own impression and RGE’s long-standing house view of

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Hardly hawkish

Below is the RBA’s Statement on Monetary Policy: At its meeting today, the Board decided to leave the cash rate unchanged at 4.75 per cent. The global economy is continuing its expansion, led by very strong growth in the Asian region. The recent disaster in Japan will have a noticeable effect on Japanese production in the

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Cheering disaster

Aussie, Aussie, Aussie, Oi, Oi, Oi. Doesn’t sound like a currency column does it? Nor should it. But the question has to be asked as to why there is such triumphalism in the reporting of the Australian dollar’s move above parity and why has it intensified recently as we reached a new all time high.

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Buying miners and groceries

Two events have the market buzzing today: the bid by China’s Minmetals Resources to buy Equinox for $7, and the announcement that Grant O’Brien will replace Michael Luscombe as CEO of Woolworths. A bit from each side of the two speed economy. The bid for Equinox is below the traded price of $7.35 and brokers