Sunday Macro – Issues du jour….. China Beijing to back United States over new Fatca law against tax evasion (SCMP) ..of course that would be a reciprocal basis for the US telling China who has what in the US system too wouldn’t it? Coming soon to a country near Australia?…. Property tycoon Zeng Wei jailed
Weekend Macro Housing, the ultimate momentum trade (Reuters) …Edward Hadas with some good points… A Cheat Sheet for Understanding the Different Schools of Economics (Pragmatic Capitalism) …very good… Russia, Iraq, China and Europe – The Four Horsemen of the Geopolitical Apocalypse (Market Oracle) Does cheap money mean governments care about the future? (SCMP) WTO
China Party boss of China’s Guangzhou investigated for graft (Reuters) Doubling of Beijing’s cancer rate spurs pollution fears (MarketWatch) China’s Real-Estate Wrongs (Project-Syndicate) Moody’s warns Hong Kong banks over increased loans exposure to mainland (SCMP) China Pulling the Plug on Foreign Mainframes (Caixin) China’s Wealthy Should Move More Money Abroad, Investment Bank Says (Caixin) Beijing-Tianjin-Hebei
Chris Weston, Chief Market Strategist at IG Markets Asia is mostly weaker, with Japan leading the losses after the yen strengthened on the back of a set of better-than-expected CPI data. The leads from US trade were actually quite mixed with most of the major Asian bourses pointing to a flat start. As a result
By Leith van Onselen Nobel Prize winning economist, Joseph Stiglitz, has urged the Abbott Government to abandon its austerity drive and increase public spending. From The AFR: “Australia is in a very good fiscal position… I would have thought the focus should not have been on cutting spending, [and] fiscal stringency, but on investing more
By Leith van Onselen Liberal chair of the House of Representatives inquiry into foreign property investment, Kelly O’Dwyer, has today flagged stricter rules and tighter enforcement of foreign property purchases, amid admissions that the current monitoring and enforcement system is failing. From the ABC: O’Dwyer, told the ABC criminal penalties were in place but no
It seems the Abbott Government’s celebrations upon repealing the carbon tax might have been premature (via MB reader Disco Stu): According to The Australian today, several Senate cross-benchers have threatened to vote against the carbon tax’s repeal unless the Government extends subsidies to the automotive industry, which are slated for abolition once the local industry
By Leith van Onselen The Fairfax dailies are running an article today on the $430 million blow to Australian retailers following the release of the May Federal Budget: Nearly $480 million has been wiped off the value of Australian retailers since the May budget was delivered… More than half a dozen retailers including Kathmandu Holdings,
By Leith van Onselen The Reserve of Australia (RBA) assistant governor, Christopher Kent, has injected some good sense into the housing debate, arguing that Australia’s affordability woes are primarily home grown, rather than caused by foreign investment. From The AFR: …arduous planning processes, a lack of land and residents unwilling to accept higher-density housing in
By Leith van Onselen As noted by Houses & Holes earlier this morning, the Bank of England (BoE) has announced that it will implement so-called macro-prudential controls on higher risk mortgage lending by limiting 15% of all new mortgage lending (per bank) to 4.5 times income. It is a positive step, and should help to
From Bloxo today: Growth in Australia had strong momentum around the turn of the year. Q1 GDP increased by +1.1% in the quarter and +3.5% y-o-y, which is above trend growth for Australia. GDP was supported by very strong growth in resources exports to China, as new mining and export capacity came on-line. At the
I’m in danger of blowing a gasket today. Here are the free-market-loving young Libs celebrating the destruction of the carbon price, a market-based mechanism to address climate change: Apologies to Mike Bowers but what a bunch of #$%!&.
Finance Minister Mathias Cormann appeared at the ABC this morning to reiterate his objections to a CBA Royal Commission and again referred any investigation to David Murray who is heading the current financial inquiry, even though Mr Murray’s tenure at the CBA is relevant to any investigation. What’s he going to do, Mathias, interview the mirror? For some
By Leith van Onselen The Productivity Commission (PC) has issued a warning about potential deleterious costs for competition and business stemming from Australia’s so-call “free trade agreements” (FTAs). From The AFR: “Trade agreements can distort comparative advantage between nations and consequently reduce efficient resource allocation”… Building on its 2010 report which found the benefits to
Here are the iron ore price charts for July 26, 2014: So! The paper market short squeeze tightens. The Dalian 6 month was especially impressive, limit up at one point, and rebar futures were up 1% too. However, physical remains mixed. Spot is up firmly, although nothing like the 5-7% daily jumps we saw in
Of all of the financial systems in the world, Australia’s is most similar to the UK. Of all of the restrictive housing planning systems in the world, Australia’s is most similar to the UK. Of all of the house price boom and bust cycles in the world, Australia’s is most similar to the UK. The
From Moodys last night: Moody‘s Investors Service says that Australia’s economic growth in 2014 has so far been resilient and expects expansion of2.6%-3.0% per annum over the next five years. Moreover, Moody‘s believes that near-term growth appears to be driven primarily by domestic consumption, rather than exports and resource investment.Moody‘s conclusions were contained in its just-released credit analysis “Australia”, which looks
By Leith van Onselen In the week ended 26 June 2014, the RP Data-Rismark 5-city daily dwelling price index, which covers the five major capital city markets, rose by 0.83%. It was the second consecutive week of rises (see next chart). The growth nationally was driven by strong rises in Sydney and Melbourne, which more
What a day. The senate is calling for a Royal Commission into the Commonwealth Bank of Australia (CBA) planner scandal. From the AFR: …“In effect, the CBA managed, for some considerable time, to keep the committee, ASIC and its clients in the dark,” said the report, tabled on the last sitting day of the current Senate.
From Banking Day: Quarterly “pillar 3” disclosures by banks may become more complex and also have to be produced on a more timely basis, if proposals from the Basel Committee on Banking Supervision come into force in Australia.The BCBS said this week that “in the wake of the 2007-2009 financial crisis, it became apparent that
No carbon tax to pay and as of any minute no mining tax either: The Abbott government is preparing to put the mining tax on the scrap heap as its repeal bill passed the lower house for a second time. The government rammed its bill through on Thursday, limiting debate to under two hours. The
North America: Are auto loans a sub-prime crisis in the making? – Yahoo U.S. second-quarter growth forecasts cut on tepid consumer spending – Reuters Job Growth Is Up, Production Down – New York Times City Loses Final Appeal on Limiting Sales of Large Sodas – New York Times Butter is back, as Americans for the
Chris Weston, Chief Market Strategist at IG Markets Price action in capital markets overnight once again highlights traders’ love affair with stimulus and an easy stance towards monetary policy from certain developed market central banks. This concept still feels wrong, and one would have hoped that at this stage in the cycle we would be
The WA Chamber of Commerce has released it quarterly survey of members today and it shows sentiment rolling steadily downhill: Business confidence in the WA economy has softened further according to the latest Westpac – CCI Survey of Business Expectations. The June quarter survey showed that 46 per cent of respondents expect conditions to deteriorate over
From the newly released book of Mammon comes Australia’s top ten most wealthy totaling $73 billion: 1. GINA RINEHART: $20.01 billion, mining 2. ANTHONY PRATT: $7.64 billion, packaging 3. JAMES PACKER: $7.19 billion, gambling 4. FRANK LOWY: $6.87 billion, shopping centres 5. IVAN GLASENBERG: ? mining 6. HUI WING MAU: $6.35 billion, property 7. ANDREW
