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31 Oct 2017 (AFR) – China’s home prices cool, property companies reduce risks

(31 October 2017, AFR, p44, by Umesh Desai and Clare Jim) ‘As the froth comes off China’s home prices, there are increasing signs that some property developers, particularly those with a heavy debt load, are becoming less aggressive. They are reducing balance sheet leverage, buying land through joint ventures with other property companies to reduce … Continue reading

30 Oct 2017 (AFR) – Why we shouldn’t forget to celebrate a bull market

(30 October 2017, AFR, p23, by Julian Beaumont) ‘While the 1987 stockmarket crash got plenty of attention in recent weeks, there’s another important anniversary to reflect on this week. This Wednesday marks the 10th anniversary of the ASX hitting its all-time high. On November 1, 2007, the S&P/ASX 300 Index closed at 6845 points. Relatively … Continue reading

30 Oct 2017 (AFR) – US economic growth: too much of a good thing?

(30 October 2017, AFR, p22, by Patrick Commins) ‘After a week of barnstorming US economic data, investors may begin to worry that it’s possible to have too much of a good thing. The world’s biggest economy expanded at an annualised rate of 3 per cent over the September quarter, official data released on Friday night … Continue reading

28 Oct 2017 (online) – US Stocks Open Mixed As FANGs Soar, But Merck, Chevron Drag On Dow

(28 October 2017 AEST, 27 October US time, Alan R. Elliott, ‘Stocks scraped out a mixed start Friday, a trainload of influential companies reported a mix of third-quarter results. The tech sector rallied to an early lead, with the Nasdaq Composite jumping 1.1% on positive earnings news from (AMZN), Microsoft (MSFT) and Alphabet … Continue reading

28 Oct 2017 (AFR) – Correction no cause for panic – House prices in the long-term look positive despite rate hike

(28 October 2017, AFR, p31, by Christopher Joye) ‘If you take the median house price in 1980 and raise it by both the increase in disposable household incomes and the expanded borrowing capacity enabled by the reduction in mortgage rates to June 2017, you will find that today’s house prices are only 3 per cent overvalued. … Continue reading

28 Oct 2017 (AFR) – Investors fret, but the ‘Icarus trade’ flies ever higher

(28 October 2017, AFR, p29, by Patrick Commins) ‘This week we have been greeted with a new way to measure the complete lack of worry in global markets. The US Office of Financial Research has put together a snapshot of stress in global financial markets. The “Financial Stress Index” is constructed from 33 variables, such … Continue reading

28 Oct 2017 (AFR) – European Central Bank chief Mario Draghi postpones market day of reckoning

(28 October 2017, AFR, p27, by Karen Maley) ‘Mario Draghi, head of the European Central Bank, is a staunch believer in monetary rectitude – just not yet. Draghi gave a nod towards monetary correctness by announcing the ECB’s huge bond-buying program will be halved to €30 billion ($45 billion) a month between January and September 2018. … Continue reading

28 Oct 2017 (AFR) – What worries? Big tech thrills investors – Regulators frown on Amazon, Microsoft and Alphabet as big tech investors gush

(28 October 2017, AFR, p27, by Nick Wingfield and Daisuke Wakabayashi) ‘Big technology companies are being dragged in front of Congress to answer tough questions about their impact on the 2016 presidential election, and their market power is under increasing scrutiny. But back on their home turfs, it is business as usual, as earnings reports … Continue reading

28 Oct 2017 (AFR) – Michael Yates to offload site after unit sales flag: ‘All cycles come to an end’

(28 October 2017, AFR, p8, by Michael Bleby) ‘Melbourne Michael Yates is stepping back from the apartment game, after the offer of an electric BMW wasn’t enough to tempt enough buyers to his last planned development. . . . The 73-year-old Mr Yates is now selling the 55 Claremont Street site he marketed last year … Continue reading

28 Oct 2017 (AFR) – ASX falls 0.2pc on citizenship ruling, $A weakens

(28 October 2017, AFR, p33, by Jessica Sier) ‘Shares ended Friday’s session in the red, turning lower in the afternoon after the government lost its one seat majority as investors fretted about the potential impact of rising political uncertainty on the sharemarket. Investors had been on track to enjoy another week of gains, with appetite … Continue reading

27 Oct 2017 (AFR) – When will this rally end: Investors ask the most common question on Wall Street

(27 October 2017, AFR, p31, by Philip Baker) ‘The S&P 500 is now deep into it’s ninth year of gains, and after 50 record highs so far this calender year it’s probably not surprising that Goldman Sachs equity strategist David Kostin says the most common question on Wall Street right now is: “When will this … Continue reading

26 Oct 2017 (AFR) – Sydney to be hit hardest by apartment investor, development pullback, JLL says

(26 October 2017, AFR, p32, by Michael Bleby) ‘A pullback underway by investors and developers on new apartment projects is raising the risk of an undersupply of accommodation that will hit Sydney hardest in coming years, real estate agent JLL says.’ Read more at (might need AFR login access, or try:

26 Oct 2017 (AFR) – Salt and Pepper: landlords dismiss Sydney gloom

(26 October 2017, AFR, p30, by Nick Lenaghan) ‘Warnings of a flood of new office space swamping the Sydney market have been hotly contested from the country’s biggest landlords. The gloomy forecast was issued this month by Pepper, a property consultancy, which said on Tuesday that “the hype around the strength of the Sydney market” … Continue reading

26 Oct 2017 (AFR) – Electricity rise holds up inflation – If not for poor government policies, inflation would be lower

(26 October 2017, AFR, p28, by Philip Baker) ‘Finally, there’s some good news for the Turnbull government and its botched energy policy. Without the spike in electricity prices in the third quarter there would hardly be any inflation at all. As it stands, the inflation rate is low enough to cause some concern – it’s … Continue reading

26 Oct 2017 (AFR) – Don’t blame central banks for build-up of financial risks

(26 October 2017, AFR, p25, by Martin Wolf) ‘”Favourable global economic prospects, particularly strong momentum in the euro area and in emerging markets led by China and India, continue to serve as a strong foundation for global financial stability.” This statement opened the International Monetary Fund’s April 2007 Global Financial Stability Report. Since this benign … Continue reading

26 Oct 2017 (TheAge,SMH) – World’s smallest wine vintage since 1961 may spell good news for Aussie producers

(26 October 2017, The Age, BusinessDay, p22, Rudy Ruitenberg) ‘The world may produce the least wine this year in half a century after small grape harvests in Italy, France and Spain, a global wine organisation said, forecasting higher prices for bulk and entry-level wine. That could spell good news for Australian producers, which had a … Continue reading

25 Oct 2017 (AFR) – Melbourne land prices soar by 10-times rate of inflation

(25 October 2017, AFR, p40, by Duncan Hughes) ‘Melbourne residential land prices rocketed by nearly 20 per cent – or 10 times the rate of inflation – during the past 12 months, worsening affordability and spotlighting deep problems in the state’s land release and planning, according to analysis by the Housing Industry Association, which represents  residential … Continue reading

25 Oct 2017 (AFR) – Supply flood to hit Sydney office market: Pepper

(25 October 2017, AFR, p35, by Nick Lenaghan) ‘A “supply tsunami” of office space in the pipeline for Sydney could hit landlords in that market harder than many have expected, according to property consultant Pepper. The acceleration in rents – which have surged almost 20 per cent during the past two years – and declining … Continue reading

23 Oct 2017 (AFR) – Labour market surge set to deliver higher wages, says economist Chris Richardson

(23 October 2017, AFR, p5, by Jacob Greber) ‘Australian workers are set to begin enjoying a return to higher wage gains as the big storm clouds of weak productivity growth and a slower China begin to clear, says economist Chris Richardson. In one of his most upbeat outlooks in years, Mr Richardson describes the 300,000 … Continue reading

23 Oct 2017 (AFR) – Sydney property still ‘hit and miss’ on sales – Sellers willing and able, auction clearances stable

(23 October 2017, AFR, p3, by Matthew Cranston) ‘Sydney’s auction clearance rate strengthened on the weekend but with more than 1000 homes up for auction next weekend some are already suggesting it is becoming a buyer’s market. Sydney saw 70.4 per cent clearance rate, up from 68.4 per cent last week. In Melbourne the rate … Continue reading

21 Oct 2017 (AFR) – Why Wall Street’s ‘Black Monday’ is a red herring

[COMMENT: Here is a good article describing some of the events of the infamous markets crash of 1987 – Black Monday in the US and Black Tuesday in Australia.] (21 October 2017, AFR, p29, by Patrick Commins) ‘ “By the time we got to the crash, it was clear that equities were very expensive relative … Continue reading

21 Oct 2017 (AFR) – Bond market investors split over Glenn Stevens warning

(21 October 2017, AFR, p6, by Jonathan Shapiro) ‘Australian bond investors say that investors should heed the former Reserve Bank governor’s warnings that markets are underpricing the risk of inflation, even if they don’t expect it to emerge in the near term. On Friday, Glenn Stevens broke his year long silence since his retirement by publishing … Continue reading

21 Oct 2017 (AFR) – It’s finally all over for Holden – 7,687,675th car – and it’s last

(21 October 2017, AFR, p3, by Simon Evans) ‘Almost 70 years after prime minister Ben Chifley welcomed the first Holden car with an exclamation of “She’s a beauty”, the last Holden rolled off a production line in Adelaide on Friday. With it the long, slow demise of Australian car manufacturing finally came to an end.’ Read … Continue reading

21 Oct 2017 (AFR,SMH) – Shares extend rally to two weeks, closing above 5900

(21 October 2017, AFR, p33, Sarah Turner and Patrick Commins) ‘Australian shares clinched a two-week rally with another advance on Friday, with the benchmark top 200 index closing over the final session above 5900 for the first time since May. In the week’s final session the benchmark S&P/ASX 200 index advanced 10 points, or 0.2 … Continue reading

20 Oct 2017 (AFR) – Black Monday 1987: Nervous silence marked a day of drama

[COMMENT: There are many news stories appearing this week about the 1987 global stock market, because this is the 30th anniversary. Is it a time to celebrate? or to reminisce? or to contemplate how it happened and how we could have seen it coming so that we can be prepared for it when it comes … Continue reading

20 Oct 2017 (AFR) – Real people’s money and how to see the next crash coming – Nothing to celebrate in the anniversary of the ’87 crash

(20 October 2017, AFR. p27, by Philip Baker) ‘Who said there’s no room for romance on Wall Street and it’s all just about making money? Thirty years after chalking up its biggest one-day fall, the Dow Jones Industrial Average hits a fresh record high and closes above 23,000 for the first time. Happy anniversary indeed. Ever since the Dow … Continue reading

20 Oct 2017 (AFR) – Consumers defy the bears again – China growth slows slightly in third quarter

(20 October 2017, AFR, p14, by Angus Grigg) ‘China’s consumers continued to defy the sceptics during the third quarter, helping retail sales post stronger-than-expected gains, even as overall growth slowed modestly. The world’s second-largest economy grew by 6.8 per cent during the September quarter, as industrial profits showed their strongest growth in nearly five years. … Continue reading

20 Oct 2017 (AFR) – Jobs boom lifts rate hike chances – Jobless rate falls to 5.5pc in August

(20 October 2017, AFR, p6, by Jacob Greber) ‘The labour market is expected to tighten enough in coming months to ramp up the Reserve Bank’s scope to start hiking official interest rates after employers recorded in September the longest run of consecutive monthly job gains since mid-1994. Annual employment growth has surged to 3.1 per cent … Continue reading

20 Oct 2017 (TheAge) – ‘Czech Trump’ Andrej Babis poised to deliver latest blow to EU order

(20 October 2017, p14, Nick Miller) ‘Europe’s year of political upheaval isn’t over. In the Czech republic, a charismatic, controversial billionaire dubbed the ‘Czech Berlusconi’ – and more recently the ‘Czech Trump’ – is poised to take power. Hot on the heels of Austria’s hard shift to the right, this weekend’s legislative election in the … Continue reading

20 Oct 2017 (TheAge,SMH) – RBA calls out Brisbane apartment glut risk

(20 October 2017, The Age, BusinessDay, p21, Clancy Yeates) ‘A senior Reserve Bank official has flagged concerns about the “awful lot” of apartments due to flood the Brisbane property market, and the potential hit facing investors who had bet on making capital gains. Michele Bullock, assistant governor for the financial system, on Thursday signalled that … Continue reading