Links 17 July 2019

Global Macro / Markets / Investing: Hyperinflation and hunger: Turkmenistan on ‘edge of catastrophe’ – Aljazeera History of modern money from gold to petroyuan & de-dollarization – Medium Which are the biggest threats for the global economy? – Economo The world ‘needs another Bretton Woods conference’ – Coin Rivet Apple and Amazon Probably Won’t Be

Latest posts


Macro Afternoon

Stocks in Asia are mixed again with the return of Japanese stocks as the USD gains strength against most of the major currencies, particularly Yen, although Kiwi keeps on as its CPI print comes in as expected. The Shanghai Composite continues its slow start to the week, falling 0.2% going into the close, currently at 2934


Building sector “could collapse” from insurance crisis

JMG Building Surveyors CEO John Massey has urged Prime Minister Scott Morrison to resolve what he says is a national crisis concerning professional indemnity insurance. Massey notes that insurance companies are offering private building certifiers coverage with exclusions for cladding and other dangerous materials, but that companies such as his cannot operate without being fully


ANZ: Property to boom 3% in 2020

Via ANZ at the AFR today: “We have revised our forecasts and now expect prices to bottom out in coming months and rise modestly through to the end of 2019, before gaining around 3 per cent in 2020,” ANZ said. …banks now get to use the set their own “floor” rate to test a borrower’s


Private health insurance facing “death spiral” as young’uns exit

The Grattan Institute has released a new working paper, entitled The history and purposes of private health insurance, which forecasts an ‘exodus’ of young and healthy people from the private health system leaving private health insurers struggling to cope with older, sicker patients. This leaves the industry in need of desperate reform: Australia’s private health


Lunatic RBA: Rate cut for spending not speculation

June rantings from the Lunatic: International Economic Conditions Members commenced their discussion by noting that growth in the global economy had remained moderate over preceding months. Global trade and manufacturing activity had slowed over the preceding year. Trade tensions had remained elevated, although no new measures had been introduced since the previous meeting. In China,


Pensioner parasites fasten to taxpayer pork

National Seniors Australia (NSA) has reacted angrily to the federal governments changes to the pension deeming rate, accusing the government of having its “hands in pensioners’ pockets at a time when they can least afford it”. From The Guardian: The National Seniors Australia chief advocate, Ian Henschke, said the Coalition’s $600m commitment was welcome, but


Hypocrite Coalition tells states to lift game on infrastructure

Urban Infrastructure Minister Alan Tudge has called on the states to lift their investment in infrastructure to help stimulate the Australian economy, claiming they have greater capacity than the Commonwealth. From The AFR: The federal government is prepared, where possible, to fast-track infrastructure projects but says the states have the greatest capacity to pick up


Victorian taxpayers bail-out flammable builders

The property lobby has won again with Victorian taxpayers to spend $600 million for rectification workers to remove flammable cladding from the state’s high-rise buildings: Victorian taxpayers will help fund major rectification works on buildings with dangerous combustible cladding, Premier Daniel Andrews says. His Government has announced a $600 million package to fix hundreds of


How China faked its growth numbers

Great work from Zero Hedge today: As far back as 2013, China’s macro-economic data has been ‘questionably’ smoothed at best, and outright fake at worst. Whether it is trade data (“never been faker” than in 2016) or aggregate production (2018’s massive GDP distortions), as economist Nouriel Roubini once asserted, China just makes its numbers up. This month was no


RBNZ is a litmus test of Australian monetary failure

As we know, the superb RBNZ has fully integrated monetary and macroprudential policy tools, a creative leadership and national interest values. This enables 300 staff to conduct all of the functions that Australia’s combined monetary regulators fail to do with 1,400. It uses big and dumb rules to govern financial stability, the cash rate when


Hodlers rally as Trump declares war on Bitcoin

Hodlers fight back at FTAlphaville: First Trump, then flump. Having inched up a little on Friday —“boosted” by Trump’s anti-crypto tweets in the early hours of the morning, apparently —bitcoin took a dive over the weekend. At pixel, it was trading just above the $10,000 mark, down about 15 per cent since Friday. Ethereum, the thinking man’s crypto, is down


Corrupt Treasury blames workers for dud wages

Via The Australian: Stubborn employees who ­refuse to move into more productive companies are a major cause of the nation’s record-low wages growth, new Treasury research will reveal today. Workers who stay with unproductive companies instead of switching to more dynamic firms are dragging down pay increases across the economy, with Australia’s top economic advisers


Chinese visitor arrivals rebound

The Australian Bureau of Statistics on Friday released its overseas short-term arrivals and departures figures for May, which showed a continued trend worsening in Australia’s ‘tourism balance’. The number of short-term visitor arrivals fell by 4.6% in May in original terms, whereas short-term resident departures tanked by 10.6% over the month. The ratio of annual


Gas cartel farts propaganda smokescreen to cover retreat

Deary me Matthew Stevens: Queensland’s gas exporters appear to have quietly anticipated the gathering post-election furore over their domestic market obligations by embracing market logic in pushing their uncontracted coal seam production into domestic markets. While the politics of gas gets ever more confused by personal and party ambitions, the latest data assembled by independent


CoreLogic: Auctions “evidence that housing conditions are stabilising”

From CoreLogic’s quarterly auction report: CoreLogic recorded a strengthening trend in auction clearance rates over the June quarter – the last time the result was this strong was back in June 2018. Clearance rates across Melbourne, Australia’s largest auction market, showed an increase over the June quarter while Sydney’s clearance rate has outperformed both the


Kouk: Economy set for rebound

Via the Kouk: The weak economy is turning higher In the space of a couple of months, the rhetoric on the economy has gone from strong to weak. Curiously, both assessments are wrong. The economy was actually weak during the first half of 2019 and, if the leading indicators are correct, late 2019 and 2020


Daily iron ore price update (another run)

Spot jumped. Paper went nutso. Steel was firm but is still stuck. It was all about Chinese data which showed a big push into MOAR empty apartments: I just don’t think that this matters terribly. Record steel output: Hasn’t triggered much activity in Chinese iron ore imports even accounting for recent supply weakness: Presumably owing to


Macro Morning

By Chris Becker  The latest US earnings season has started, and while the headline Dow is up, the broader S&P500 is treading water as US interest rates continue to fall. The USD is up against most of the majors, with oil prices abating due to lesser concern about the hurricane in the Gulf of Mexico affecting


Universities launch international student propaganda drive

Innovative Research Universities (IRU) – a collaboration between Charles Darwin University, Flinders University, Griffith University, James Cook University, La Trobe University, Murdoch University and Western Sydney University – met yesterday to commence talks on undertaking collective action to “counter media and public concerns” surrounding international students and to further grow the market by expanding into


Australia CPI preview

Via Westpac: Westpac is forecasting a 0.5% rise in the June quarter CPI lifting the annual pace to 1.5%yr from 1.3%yr. The June quarter tends to be a seasonally soft quarter with the ABS projecting a seasonal factor of +0.2ppt. The seasonally adjusted CPI is forecast to rise 0.7%. The trimmed mean is forecast to


Links 16 July 2019

Global Macro / Markets / Investing: 83% of IPOs (new stock issues) this year have come to the market with negative earnings – FT Alphaville The world ‘needs another Bretton Woods conference’ – Coin Rivet Apple and Amazon Probably Won’t Be the Next Decade’s Best Stocks – Barron’s Cost of living Index by Country, mid-2019