My long term readers would be aware that one of my pet hates is that members of the real estate industry do not have the same legal declaration requirements as other traders of financial wares. Your local bank teller has to declare far more when you open a new bank account than a real estate
As reported in Fairfax last week, the US Masters Residential Property Fund (Investment Overview provided below) recently closed its initial public offering (IPO) for Australian investors, receiving more than double the minimum subscription. The Fund raised $69.5 million from over 1,500 investors, well above the minimum subscription level of $30 million, with the majority of
The risks inherent in the Australian banks’ heavily reliance on offshore funding has received a lot of attention on this blog (for example see here). Now with the European debt crisis seemingly reaching a crescendo, it looks like these borrowings might now be coming back to bite. From the Australian: AUSTRALIAN and South Korean banks
The climate change proponents are clear on the matter. We need a “price” on carbon so the market can set about fixing the problem. Great. More derivatives. Exactly what we don’t need and yet another excuse to avoid the difficult job of governing. Consider what happened when there was a “price” on risk, perfected in
The media’s response to the reported slowing of Australia’s population growth on Thursday summoned the usual hysterical commentary from those concerned about skills shortages and the flow-on impacts to wages growth and inflation. For instance, the usually reliable Tim Colebatch made the following comments in an article published yesterday in Fairfax [my emphasis]: NET migration
Since most of the MacroBusiness crew are under the weather, I thought I’d stick my oar in this weekend with some quiet musings. Two things to consider in this post: the notion of sound economic language, and how would you allocate $2 million for your retirement? Language is for the Birds Houses and Holes recently
I’ve been out of the office for the back end of the week so my observations are more ex-poste than normal. Sometimes that’s a good thing because we can always write history perfectly but at other times you miss the nuances that you gain when you are sitting in the midst of what’s going on. But I
RPData has put out their latest newsletter today and once again it isn’t great news for the housing market. The RP Data-Rismark Home Value Index results for May 2011 will be released next week and there is little evidence to suggest that there will be any significant change to market conditions with values likely to
Societe Generale (SocGen) has released a fascinating 50-page research report entitled Chinese construction bubble – Preparing for a potential burst. The report argues that the exponential growth of real estate and infrastructure spending in China is unsustainable and a painful adjustment will occur sooner or later, although SocGen acknowledges that it is impossible to predict when the slowdown or correction
The S&P/ASX 200 has steadied after midday, now at 4498 points, down 0.04%, after opening slightly higher. Asian markets are mainly up, with the Nikkei up 0.28 percent to 9624 points, and the Hang Seng up strongly, 1.22% to 22,025 points. Other risk assets are mixed, although the AUD is just below 1.055 against the
The battle for the hearts and mind of who’s telling the truth about housing prices in Australia rages on. In the latest installment SQM research’s Louis Christopher has returned serve to Michael Matusik via SQM’s newsletter. I have talked Mr Matusik previously, he is a housing bull , turned bear, who now seems to flip-flop between
Saul Eslake, Director of Productivity Growth Program at the Grattan Institute, yesterday presented a paper at the International Conference of Commercial Bank Economists in Amsterdam, the Netherlands, on some of the longer term demand and supply factors shaping the behaviour of commodity prices, over the past decade and over the next 5-15 years. The full paper is below and
In an odd juxtaposition, the bogan, while poorly informed on almost all matters, will still have an opinion on most things, and is actually a relatively voracious consumer of media. The media have long known the enticing power of the bogan buck, and once their websites gave them the power to monetise bogan clicks, and
On news of the 4.6 percent decline in crude oil yesterday, in response to the International Energy Agency’s announcing a release of supplies from strategic reserves, and after my look at gold yesterday (which also fell last night) I thought I’d have a closer look at where we stand with commodities. First, the two major
Judging by comments on the net and the press and in general public discourse, it appears that there’s still confusion between the role of the carbon price signal and the role of the distribution of proceeds from revenue raised. The latter has derisorily been referred to as a great big merry-go-round. Here’s an example of
In conducting research for last night’s post on the German housing market, I came across some interesting information on the housing bubble developing in Sweden. It’s a story worth sharing since it offers important insights and parallels for Australia. Before I kick-off, first consider the below chart of real house prices since the mid-1980s: As
A little off topic tonight, but hopefully not too far. One of the things I used to talk about on my old blog was a concept I called GPEC. I am not going to discuss it again here, but basically it is a measure that I suggest government economic policy should be judged by. GPEC
As my readers would know I have been discussing Europe’s financial issues for quite some time. I have stated many times that Greece’s issues are far bigger than just internal fiscal policy, and that I consider Greece’s default an inevitability due to its macro-economic position within the European marketplace. Overnight PIMCO added their voice to
The bid by SAB Miller for Foster’s almost certainly won’t go anywhere in its current form. But it is another blow to the non-resources industry base of Australia. What will Australians have to invest in on the ASX when large chunks of our industry base have become the part of someone else’s global food chain?
The S&P/ASX 200 has fallen over 20 points today, but has steadied after midday, now at 4512 points, down 0.44%, on the back of reduced GDP growth from the US. Asian markets are all down on the news, with the Nikkei down 0.37 percent to 9594 points, the Hang Seng also down 0.7% and Singapore
Spot gold in USD broke a recent high last night, after comments by the Fed chief Ben Bernanke, that milky-wilkies (QE3) are off the table, but will continue its zero interest rate policy (ZIRP) due to the slowing US economy. Gold jumped to $1559.50, before being sold off (which has regularly occurred whenever an intraday
In my research putting together my articles on Asset Allocation in Super, I’ve collated the data that supports the thesis that investing in Australian shares is not as lucrative as the financial industry would have you believe. The standard industry myth is that the stock market provides 9% returns on average. I’ll quote broker Marcus
This week’s Spotlight will be on a company I believe is probably the best listed stock on the ASX – Cochlear Ltd (COH). Not only is it a great performer, with sound management and excellent returns for shareholders, it is an innovative company that should be a template for how our economy should present itself
The Urban Development Institute Australia – Queensland division has released its report (available at the bottom of the post ) on its expectations for the building industry in Queensland over the coming year. Their press release summarises the report. While the June report is still dominated by bleak fundamental building activity figures, the Institute has
A few months ago, after posting numerous articles advocating the Texan approach to land-use planning, I promised fellow MacroBusiness blogger, The Prince, that I would undertake an analysis of the German housing system, which is regarded as amongst the most affordable and liberal in Europe. In my findings presented below, I have compared and contrasted the German housing system
