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(30 March 2012, The Age, BusinessDay, p5, Ruth Williams) ‘THE head of Australia’s securities regulator has warned of the risk to financial markets posed by high-frequency and algorithmic trading, predicting that keeping pace with increasingly complex markets would be one of the agency’s biggest challenges over the next decade.’ ‘Greg Medcraft, the chairman of the … Continue reading
(30 March 2012, The Age, BusinessDay, p3, Gareth Hutchens) ‘ONE of the biggest international banks in Australia is expanding its local presence, refusing to follow other foreign-owned banks in getting out.’ ‘It made its position clear yesterday after the Reserve Bank said foreign-owned banks, particularly European ones, were continuing to retreat from the local market … Continue reading
(30 March 2012, The Age, BusinessDay, p3, Eric Johnston) ‘ANZ boss Mike Smith has warned that Europe’s economic crisis is likely to flare again and has questioned whether it is in the best interests of some of the region’s more troubled economies to remain in the currency union, saying they will struggle to remain competitive … Continue reading
(30 March 2012, AFR, p21, George Liondis) ‘The corporate regulator has raised concerns about the threat posed by high-speed share trading, warning it presents one of the main risks to markets.’ ‘Australian Securities and Investments Commission chairman Greg Medcraft said markets were becoming more complex because of technological advancements, increasing the dangers for investors.’ ‘Mr … Continue reading
[COMMENT: Now this is VERY interesting. When S&P provides a rating, if we rely on it, and the rating proves to be unreliable, and we lose lots of money, we can’t sue them for the rating? It’s all our own problem?…] (29 March 2012, The Age, BusinessDay, p1, Elisabeth Sexton) ‘A FIVE-MONTH case billed as … Continue reading
(29 March 2012, AFR, p27, Paulina Duran) ‘The subdued state of the housing finance market will reduce tax intakes for governments, compounding the problems in the soft residential property market, a report warns.’ ‘The so-called “new normal” environment, where households have low gearing and a prudent approach to savings, is unlikely to reverse in the … Continue reading
(29 March 2012, AFR, p21, By Ambrose Evans-Pritchard from The Telegraph) Spain to slash spending as economy slumps back into recession ‘Spain’s fragile economy has fallen back into recession and the country faces a year of grinding economic decline as premier Mariano Rajoy slashes spending yet further to meet EU demands. ‘ ‘The Bank of … Continue reading
(29 March 2012, AFR, p21, By Svenja O’Donnell from Bloomberg) Britons See Disposable Incomes Plunge Most Since 1977: Economy ‘Britons suffered the biggest drop in disposable income in more than three decades last year in a squeeze that may continue this year as energy prices increase.’ ‘Real household disposable income fell 1.2 percent, the Office … Continue reading
(28 March 2012, The Age, BusinessDay, p1, Chris Zappone and Carolyn Cummins) ‘HOME owners and developers have felt the icy blast of deteriorating conditions in the residential market that have triggered a rise in mortgage arrears and profit warnings.’ ‘Credit ratings agency Fitch reported yesterday that late payments on mortgages jumped unexpectedly at the end … Continue reading
(28 March 2012, AFR, p38, By Nikolaj Gammeltoft and Whitney Kisling from Bloomberg) Hedge Funds Capitulating Buy Most Stocks Since 2010 ‘Hedge funds trailing the Standard & Poor’s 500 (SPX) Index for the last five months are giving up on bearish bets and buying stocks at the fastest rate in two years.’ ‘A gauge of … Continue reading
(28 March 2012, AFR, p28, Bianca Hartge-Hazelman) ‘Retail investors are being encouraged to use dark pools created by investment banks to minimise costs, despite attempts by regulators to crack down on the hidden trading platforms.’ ‘Traders believe the benefits of trading in dark pools, which tend to get a lot of negative publicity, outweigh the … Continue reading
(28 March 2012, AFR, p24, Paulina Duran) ‘Australian home loans backing prime residential mortgage-backed securities (RMBS) had an unexpected increase in arrears in the last quarter of 2011 despite a stable economic background, Fitch Ratings has found.’ ‘The increase in the agency’s Dinkum Index, a reading on the health of Australian RMBS, was mainly driven by … Continue reading
(27 March 2012, The Age, BusinessDay, p1, Eric Johnston) ‘BANK of Queensland is poised to post the first loss by a key Australian bank in nearly two decades after being caught exposed to a property market bust across the tourism hot spots of its home state.’ ‘The regional bank has launched a surprise $450 million … Continue reading
(23 March 2012, AFR, p45, Li Yanping, Beijing, from Bloomberg) China Manufacturing Contraction May Worsen, Data Show ‘A Chinese manufacturing index indicated a worse contraction this month, bolstering the case for Premier Wen Jiabao to add measures to sustain growth even as he prolongs a campaign to cool property prices.’ ‘The preliminary 48.1 reading in … Continue reading
[COMMENT: So, the professionals are finally realising that the weightings of asset classes within the average superannuation fund portfolio have been too heavily weighted to the sharemarket? Perhaps what they really mean is that the funds have not been nimble enough to re-allocate the managed funds into less risky asset classes when the share market … Continue reading
[COMMENT:- WOW! Now this is a sign of the times. Many corporates starting cutting back on business travel expenses a few years ago, and now an investment banking group is following suit – times must be tough.] (22 March 2012, AFR, p3, Joyce Moullakis and John Kehoe) ‘Macquarie Group, once dubbed the Millionaires Factory, is … Continue reading
(22 March 2012, Bloomberg) ‘A Chinese manufacturing index indicated a worse contraction this month, bolstering the case for Premier Wen Jiabao to add measures to sustain growth even as he prolongs a campaign to cool property prices.’ ‘The preliminary 48.1 reading in a purchasing managers’ index from HSBC Holdings Plc and Markit Economics today is … Continue reading
[COMMENT: How about that!! Gob-smacking! In New York, if I invest unknowingly in a ponzi scheme, and I make profits and take the profit, and then subsequently the scheme goes bust, I could be forced to return my profits! Guilty until proven innocent? Wow!] (21 March 2012, The Age, BusinessDay, p15, Joe Nocera) ‘While some … Continue reading
(21 March 2012, The Age, BusinessDay, p14, Philip Hopkins) ‘NON-RESIDENTIAL building in Victoria is facing further decline over the next two years, but nationally it’s a mixed bag, according to forecaster BIS Shrapnel.’ ‘In Victoria, non-residential building, having fallen by 12 per cent to $7.74 billion in 2010-11, is expected to decline by another 6 … Continue reading
[COMMENT: I thought the experts say that investing in bricks and mortar is safe (as safe as houses). but that doesn’t seem to be the case when your mortgage can balloon out because of falling asset prices. It is so difficult to liquidate quickly – give me share market investing any idea.] (21 March 2012, … Continue reading
(21 March 2012, Bloomberg, Isaac Arnsdorf) ‘After a quarter in which companies selling space on container lines doubled rates, the amount the owners of the ships are being paid is the least in two years.’ ‘Operators, who charter vessels and then charge shippers per container, are demanding $1,379 for a 20-foot box on the China- … Continue reading
(21 March 2012, AFR, p33, Whitney Kisling, from Bloomberg) S&P Volatility Falls Most Since FDR as Valuations Sink ‘Daily price changes in the Standard & Poor’s 500 Index are decreasing the most in eight decades, shrinking to the smallest since 1995 when investors abandoned stocks just before the biggest rally ever.’ ‘The benchmark gauge for … Continue reading
(21 March 2012, AFR, p19, Tony Boyd Hong Kong) ‘The pristine balance sheets of China’s banking system are hiding a “financial black hole” of non-performing property loans that must eventually come to the surface.’ ‘That is the opinion of Victor Shih, a professor from Northwestern University, Illinois, who told a private session at the Credit … Continue reading
(21 March 2012, AFR, p7, Adrian Rollins) ‘The chances of further official interest rate cuts appear to be receding as global conditions improve and the local economy grows solidly despite tough conditions hurting key sectors.’ ‘The Reserve Bank of Australia board has indicated it is in no hurry to adjust monetary policy, arguing that despite … Continue reading
[COMMENT: A great article about High Frequency Trading, and the computers that might make brokers redundant.] (20 March 2012, AFR, p32, David Ramli) Goodbye broker, hello supercomputer ‘The stockbroker’s alarm clock screams at the crack of dawn – it is 6am and time for work.’ ‘Out of bed with a quick stop at the coffee … Continue reading
(19 March 2012, AFR, p20, George Liondis) ‘Australia’s biggest online stockbroker, CommSec, has signed up to trade shares through Chi-X in a major boost for the fledgling exchange operator.’ ‘The Commonwealth Bank-owned group will direct its trades to either Chi-X or the Australian Securities Exchange, depending on which is offering the best price and conditions.’ … Continue reading
(17 March 2012, AFR, Matthew Drummond, Paris) ‘As spring arrives in Europe the continent’s leaders are patting themselves on the back for winning over investment markets – borrowing costs for Spain and Italy are well below crisis levels and Fitch ratings this past week raised its rating on Greece. But the politicians are soon to … Continue reading
(17 March 2012, AFR, p26, Tony Featherstone) ‘When it comes to private investment opportunities, nothing beats personal networks. But any investor can maximise access to “deal flow” with these simple strategies.’ ‘Choose the right broker Some broking firms are more active in this space than others. Firms that specialise in the resource sector, or have … Continue reading
(17 March 2012, AFR, p25, Tony Featherstone ) ‘ Picture this: a speculator punts $10,000 on a small float and the 20¢ issued shares soar to $2 in two years. The “tenbagger” stock seems too good to be true, until he or she realises other investors bought shares at 2¢, 5¢ or 10¢ during earlier capital … Continue reading
[COMMENT: This old tale is a really good one, about the bankers and brokers and their yachts… “Where are their customers’ yachts?”…] (17 March 2012, AFR, p24, Philip Baker) ‘When the world worked itself into a lather this week following a scathing attack on Goldman Sachs from one of its own bankers, those in the … Continue reading
Aussie Sharemarket Barometer 