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PM Property Council: Labor’s negative gearing reform will “crash” market

By Leith van Onselen Our Property Council Prime Minister, Scott Morrison, has recommenced his scare campaign against Labor’s promised negative gearing and capital gains tax reforms, describing them as a “sledgehammer” that would “crash” the housing market. From News.com.au: “The risk is this,” the Prime Minister said. “If you now take the sledgehammer of negative

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Are household savings about to rise?

You tell me, via Domainfax: Capital Economics chief economist Paul Dales explains, the savings rate tends to be affected by movements in household wealth. The chart shows that as wealth rises, we tend to save less – known as the “wealth effect.” “When household wealth is going up because the housing market is improving, the

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CBA: Why house prices will continue to fall

By Gareth Aird, Senior Economist at CBA Key Points: Australian residential property prices have fallen over the past nine months. Further declines appear likely over the next year due to softer credit growth, a continued lift in apartment supply, less foreign demand and more rational price expectations from would-be buyers. We retain our view, however,

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London housing posts weak recovery

By Leith van Onselen Acadata has released its latest house price results for the UK, which shows that values in London are rebounding after a period of price falls. However, in real inflation-adjusted terms, property values are still declining across the UK: Monthly prices rose modestly in August. They were up just 0.1%, but it

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Labor humiliates Morrison energy “chaos”

Via The Australian comes Queensland Energy Minister Anthony Lynham: “We stand ready to work with a federal Labor government on integrated climate and energy policy that will give investors certainty and drive down electricity prices,” he said. …Dr Lynham claimed there was “nothing but chaos and confusion” emerging from the Morrison government on energy policy

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Murdoch anoints Shorten

Just in case you’re still wondering whether or not Labor is going to win the federal election next May, via the AFR: Murdoch met with Seven West proprietor Kerry Stokes and implied the very opposite. “Malcolm has got to go,” he told the Perth billionaire. Stokes, whose interests extend well beyond media into mining services

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Australia dollar jumps on trade war relief

DXY firmed last night: AUD bounced anyway with risk: Gold is still stuck: Oil was firm: Base metals too: Miners jumped: Em stocks improved: But EM junk sent another warning: Treasuries were bashed: And bunds: Stocks popped: Westpac has the wrap: Economic Wrap US homebuilder sentiment was unchanged in September, the National Association of Homebuilder’s

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NSW Planning Minister: “Overdevelopment does not exist”

By Leith van Onselen The arrogance of our political elites never ceases to amaze. Amid the revolt against Sydney’s break-neck population growth and declining liveability, NSW Planning Minister Anthony Roberts has arrogantly claimed “overdevelopment does not exist”: At a panel discussion on the city’s future on Friday, Anthony Roberts said he was “done with the term

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Noose tightens around Sydney landlords

By Leith van Onselen SQM Research has released its rental vacancy series for August, which revealed a 0.1% fall in the national vacancy rate over the month and a 0.1% decline over the year: Over the year, decreases in vacancies were recorded in Adelaide (-0.3%), Perth (-1.2%), Brisbane (-0.6%) and Canberra (-0.3%), whereas increases were

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Aussie housing valuations continue to deflate

By Leith van Onselen The ABS yesterday released its property price data for the June quarter, which valued Australia’s dwelling stock owned by households at $6.58 trillion, whereas the total housing stock was valued at a record $6.93 trillion. As shown below, the total value of Australia’s dwelling stock owned by households was 7.58 times

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Links 19 September 2018

Global Macro / Markets / Investing: Reflections on the Lehman collapse, 10 years later – BIS How US banks took over the financial world – FT Kimbal Musk says his brother Elon is doing ’great’ – CNBC Political Pressure on Central Banks by Carola Binder – SSRN A Lost Generation? Long-Lasting Wealth Impacts of the

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Macro Afternoon

Asian stock markets have reacted in a positive fashion to the Trump tariff announcement, fading the news, although locally the ASX200 dropped as the Aussie dollar lept higher on the RBA minutes and the easing of trade tensions (i.e a known known). The Shanghai Composite is in full reverse, currently up 1.4% going into the close

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Retailer enjoys weakest August sales in 70 years

Just sayin’, via the ABC: Launceston retailers are working out ways to bring more people into the city, after some stores experienced their worst trading month in years. Many retailers in Launceston have described August as “challenging”, but said it was hard to pinpoint the exact reasons why. Andrew Pitt, from one of city’s longest-running

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Chinese rents soar as apartments to Mars stand empty

Via Zero Hedge: Beijing has been trying to calm its bubbly real estate market with policies that divert investor funds into China’s rental market. But the policy shift to increase the supply of rental housing has backfired, leaving most middle-class Chinese with a rapid increase in living expenses. The reason: the government’s latest centrally planned

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Australia’s construction pipeline lifts in August

By Leith van Onselen CoreLogic has released its Cordell Construction Monthly report, which reveals that Australia’s construction pipeline rose in August. Specifically, the overall construction pipeline was valued at $23.5 billion in August, with apartments the second biggest construction segment behind civil engineering: There was also a big jump in the number of apartment projects

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Moody’s delusional house price forecasts

By Leith van Onselen Moody’s Analytics has released a report forecasting a 1.6% fall in housing prices across Australia in 2018. The firm expects house prices in Sydney to decline by 5.1% in 2018, although some suburbs will record larger declines while others will record growth. House prices in Melbourne are forecast to rise by

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How to fix Australia’s endless energy crisis with a pen

After years of energy war from the Coalition that has included: backing emissions trading; trashing emissions trading; backing renewable energy targets; trashing renewable energy targets; backing direct action; trashing direct action; backing the Chief Scientist; trashing the Chief Scientist; backing a National Energy Guarantee; trashing a National Energy Guarantee. Today we get the new vision from

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ABS: Property prices fell 0.7% in Q2

By Leith van Onselen The ABS has released its property price index – incorporating both detached houses and units – which registered another 0.7% decline in home values nationally over the June quarter and a 0.6% decline over the year: Sydney (-0.7%), Melbourne (-1.2%), Perth (-0.1%), and Darwin (-0.9%) recorded quarterly declines in values, whereas

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Time to drain the lobbying swamp

Better work from The Guardian today: Not a single lobbyist has been punished for breaching rules in the past five years – either federally, or in Victoria, Western Australia, Queensland or South Australia. Experts warn that the lack of enforcement leaves the sector to largely police itself, and that even if authorities took action they

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RBA minutes party in rear vision mirror

Party on RBA: International Economic Conditions Members commenced their discussion of the global economy by noting that GDP growth in most of Australia’s major trading partners had remained above trend. Monetary policy settings had continued to be accommodative in most economies, although a few central banks had become less accommodative as spare capacity was absorbed

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ScoMo’s hedge fund mates to run Australian borders

Yes, it’s border security Coalition style, via The Australian: Liberal Party heavyweight Scott Briggs — a close friend and ­political ally of Scott Morrison and a former professional colleague of new Immigration Minister David Coleman — is driving a bid to win a visa-­processing contract understood to be valued at up to $1 billion. …According

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Egghead Professor cheers crashing wages

By Leith van Onselen According to Melbourne Institute professor Mark Wooden, workers have little to complain about: Wages have far outstripped increased living costs over the past decade, rising 31 per cent against a 22 per cent lift in inflation, delivering real gains in living standards. Melbourne Institute professor Mark Wooden said that although consumer prices

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Centre Alliance shames Labor on TPP, trade policy

By Leith van Onselen The Trans-Pacific Partnership (TPP) passed the House of Representatives last night, thanks to Labor’s treacherous support. From SBS News: The coalition had the backing of Labor to pass the draft laws through the lower house on Monday, sparking fierce criticism from independent MP Bob Katter and Greens MP Adam Bandt. The