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29 Sept 2018 (AFR) – Hayne strikes down greedy banks and feeble regulators

(29 September 2018, AFR, p1, by: James Frost, Phillip Coorey) ‘Regulators are in for a major shake-up after royal commissioner Kenneth Hayne found the culture of greed permeating the financial services sector was a result of a failure to follow and enforce existing rules, and that more regulation was not the answer. The commissioner’s interim … Continue reading

29 Sept 2018 (AFR) – ASX: Banks rally as ASX closes week higher

(29 September 2018, AFR, p33, by William McInnes) ‘Australian shares closed the quarter on a high note this week, as the banks rallied on the release of the royal commission’s interim report. The S&P/ASX 200 index closed at 6207.6 on Friday, up 13 points, or 0.2 per cent, for the week. That rise was the exact same … Continue reading

28 Sept 2018 (AFR) – Cafe prices to stay level despite coffee hitting 12-year low

(28 September 2018, AFR, p9, by William McInnes) ‘Coffee is trading below $US1 a pound (0.45 cents kilo) for the first time in more than 12-years but according to experts, the price fall is unlikely to be reflected at the local cafe. Arabica coffee is trading at its lowest price since mid-2006 as currency pressures in emerging markets and a bumper crop boosts supply … Continue reading

28 Sept 2018 (AFR) – Fewer renovations hurt NSW building sector – Victoria replaces NSW as top-performing home building market

(28 September 2018, AFR, p32, by Larry Schlesinger) ‘NSW has lost its crown as the nation’s top home building state to Victoria as NSW homeowners cut back on home renovations, according to the latest HIA Housing Scorecard. The half-yearly scorecard provides a snapshot of building conditions in each state market – from strongest to weakest … Continue reading

28 Sept 2018 (AFR) – Gap between US and Australian cash rate widest ever as monetary policies diverge

(28 September 2018, AFR, p30, by Patrick Commins) ‘Australia’s official cash rate has never been this far below its American equivalent. It’s a measure of the extraordinary times in which we find ourselves that this landmark didn’t raise much more than a lazy eyebrow among investors and central bank officials alike. On Thursday morning chairman … Continue reading

28 Sept 2018 (AFR) – Copper’s robust dynamics clash with futures gloom

(28 September 2018, AFR, p29, by Andy Home) ‘You’ve got to feel sorry for Doctor Copper. He and his base metal friends find themselves on the front line of the escalating trade stand-off between the United States and China. London copper has clawed its way back from August’s 13-month low of $US5,773 per tonne but … Continue reading

28 Sept 2018 (AFR) – Schroders says shares will get ‘smashed’ in US recession

(28 September 2018, AFR, p29, by Sarah Turner) ‘The US Federal Reserve has flagged the end of easy money, and that means life is about to get much harder for investors. That’s the view of Schroders portfolio managers Simon Doyle and Simon Stevenson who broadly welcomed the Federal Reserve’s decision to raise interest rates and remove … Continue reading

28 Sept 2018 (AFR) – Federal Reserve lifts interest rates, flags end of ‘accommodative’ policy

(28 September 2018, AFR, p12, by Jacob Greber) ‘New York | The US Federal Reserve has officially ended America’s crisis era monetary policy, hiking interest rates for the third time in 2018 with more to follow, as signs of a brightening economy overshadow growing concerns about the China trade war. Shunning President Donald Trump’s complaints about rising rates, the Fed … Continue reading

28 Sept 2018 (TheAge) – No longer ‘envy of the world’: Fed’s projections put it on collision course with Trump

(28 September 2018, The Age, Business, p26, by Stephen Bartholomeusz) ‘The relative calm of the markets’ responses to the latest Federal Reserve Board interest rate hike, its foreshadowing of another later in the year and three more next year points to a level of complacency not borne out by the Fed’s economic projections.’ Read more … Continue reading

28 Sept 2018 (TheAge) – Three reasons why wages are mounting a comeback

(28 September 2018, The Age, p3, By Eryk Bagshaw) ‘Australia’s low-wage purgatory appears to be coming to an end after years of torpid growth squeezed household budgets and frustrated politicians attempting to sell the country’s economic growth story to voters. Three recent sets of figures show the composition of pay-packets is changing as higher-paying industries … Continue reading

27 Sept 2019 (AFR) – Retail rents under pressure as $2b in annual sales shift online

(27 September 2018, AFR, p17, by Sue Mitchell) ‘Leading retailers like Premier Investments are threatening an avalanche of store closures unless landlords reduce rents as $2 billion a year in sales – equivalent to the annual turnover at Chadstone, Australia’s largest shopping mall – shift from bricks and mortar to online. Rents for specialty retailers … Continue reading

27 Sept 2018 (AFR) – Aussie miners hit by China coal curbs – China restricts coal imports to boost local miners

(27 September 2018, AFR, p17, by: Michael Smith, Peter Ker) ‘Shanghai/Melbourne | China has introduced unofficial restrictions on coal imports in a bid to prop up domestic prices by slowing down customs approvals at key ports, in a move that threatens to disrupt a year of stronger-than-expected Chinese demand for Australian thermal coal. Traders on Wednesday confirmed reports … Continue reading

27 Sept 2018 (AFR) – Coffers hit if Dragon coughs – Budget a ‘sea of red’ if China stumbles

(27 September 2018, AFR, p4, by John Kehoe) ‘The federal government’s revenue surge and push towards a budget surplus is extremely reliant on China continuing to deftly manage its slowing economy and risky financial system. The biggest annual increase in tax collections – 1.1 per cent of GDP or $39 billion – since the goods … Continue reading

27 Sept 2018 (AFR) – Sky-high: Sydney’s average A-grade office rents pass $1000

(27 September 2018, AFR, p43, by Nick Lenaghan) ‘Average A-grade office rents in Sydney have passed $1000 for the first time while the value of that space has pipped $20,000 on average. The latest analysis from Savills Australia is testament to the boom in Sydney’s office market, which has driven returns for major listed players such … Continue reading

27 Sept 2018 (AFR) – Moody’s expects ‘modest’ increase in RMBS delinquency rates in 2018 and into 2019

(27 September 2018, AFR, p40, by Ingrid Fuary-Wagner) ‘Moody’s Investor Service said it expects a “modest” increase in delinquency rates for Australian residential mortgage backed securities for the rest of 2018 and into 2019. While the credit ratings agency forecasts higher GDP growth to support RMBS performance, it warns the country’s high levels of household … Continue reading

27 Sept 2018 (AFR) – Home building highest on record but activity winding down: HIA

(27 September 2018, AFR, p39, by Su-Lin Tan) ‘Home building across Australia’s housing markets has peaked as the total number of homes commenced by the nation’s top builders starts winding down, a report by the Housing Industry Association shows. While building activity in 2017-18 was the strongest year on record at 222,000 new home commencements nationally, … Continue reading

27 Sept 2018 (AFR) – China considering crackdown on apartment pre-sales

(27 September 2018, AFR, p47, Bloomberg News) ‘China’s debt-laden developers face a potentially devastating blow to their biggest source of financing, as authorities consider putting an end to the practice of selling apartments before they are finished.  Guangdong’s provincial housing authority is considering scrapping so-called pre-sales, according to a document seen by Bloomberg News. The … Continue reading

27 Sept 2018 (AFR) – India’s stock bulls stampede for the exits as volatility shatters calm

(27 September 2018, AFR, p33, by Abhishek Vishnoi and Santanu Chakraborty) ‘For India equity bulls, a good year for the nation’s equities has quickly soured. Blame it on the concerns about a troubled lender that led to a sudden cratering in non-banking finance companies (NBFCs) – a favourite among money managers until recently – and … Continue reading

27 Sept 2018 (AFR) – Emerging markets finding some favour with investors after sell-off

(27 September 2018, AFR, p33, by Sarah Turner) ‘Fund managers and strategists are taking cautious steps back into beaten-down developing markets, saying that prices have fallen far enough to tempt investors looking for a bargain. Emerging markets have had a horror year, with the MSCI Emerging Markets Index tumbling into bear market territory as the … Continue reading

26 Sept 2018 (AFR) – Blue-chip tenants, major landlords spill into metro markets

(26 September 2018, AFR, p39, by Nick Lenaghan) ‘Parramatta, west of Sydney, has the lowest vacancy rate of all the suburban office markets, reflecting a broader trend where metro markets are soaking up growth in demand for white-collar space. Parramatta’s vacancy is now at 3.4 per cent, according to Colliers International, but other metro markets are also … Continue reading

26 Sept 2018 (AFR,Bloomberg) – US household in the money – Homeowners Gain $5.57 per Hour in Home Equity Across California

(26 Septemhber 2018, AFR, p33, by Alexandre Tanzi, Bloomberg) ‘The average homeowner in the U.S. gained $16,200 in home equity over the past year ending in the second quarter of 2018, according to a report by CoreLogic, a property information firm. This represents about 25 percent of the average households income level.’ Read more at … Continue reading

26 Sept 2018 (AFR) – Emerging market rebound depends on China and India

(26 September 2018, AFR, p30, by Komal Sri-Kumar) ‘This year’s sell-off in emerging-markets assets has abated in recent weeks and valuations are tempting, but it’s too soon to say things have bottomed. The key to any rebound is China and India, two economies where the outlook has deteriorated in recent weeks. The relative size of … Continue reading

26 Sept 2018 (AFR) – Four late cycle signs put Boston fund giant on alert

(26 September 2018, AFR, p29, by Jonathan Shapiro) ‘In his four-decade career as a fund manager, James Swanson says he has learnt that the most important thing is to “know where you are in the business cycle”.   Right now, the strategist at $US450 billion ($620 billion) Boston-based mutual fund MFS Investment Management says the evidence … Continue reading

26 Sept 2018 (AFR) – Brexit Britain sets itself up to learn the hard way

(26 September 2018, AFR, p25, by Gideon Rachman) ‘It was sadly appropriate that Denis Norden, the star of the British television show It’ll be Alright on the Night, died in the same week as the EU’s Salzburg summit took place. The working assumption of many in Britain has been that the Brexit negotiations will ultimately “be … Continue reading

26 Sept 2018 (AFR) – Trump, Brexit bite into German growth outlook

(26 September 2018, AFR, p12, by Michael Nienaber) ‘Berlin | Germany’s BDI industry association on Tuesday lowered its 2018 growth forecast for Europe’s largest economy, citing weaker demand for German goods due to increased business uncertainty caused by US President Donald Trump’s trade policy and Brexit. The German economy is now expected to grow by…’ … Continue reading

26 Sept 2018 (AFR) – Hard Brexit would disrupt skies and ports, May government warns

(26 September 2018, AFR, p12, by Hans Van Leeuwen) ‘London | Aviation services and road freight between Britain and the Continent could face major disruption if the UK crashes out of the European Union without a deal, Prime Minister Theresa May’s government has warned. Official “hard Brexit” guidance released late on Monday (Tuesday AEST) painted … Continue reading

26 Sept 2018 (AFR) – Government’s FY18 budget position is due to one-off factors, say economists

(26 September 2018, AFR, p4, by Patrick Commins) ‘The rapid and unexpected improvement in the federal government’s budget position since May is down to one-off factors that are unlikely to be repeated over the coming months, economists said. Tuesday’s final budget outcome for the 2017-18 financial year showed the underlying cash deficit shrinking to $10.1 … Continue reading

26 Sept 2018 (AFR) – Aventus securityholders approve $96m payday for Brett Blundy – A retail values warning

(26 September 2018, AFR, p1, by Larry Schlesinger) ‘Retail billionaire Brett Blundy has walked away $96 million richer after 72 per cent of Aventus securityholders voted in favour of acquiring the homemaker centre trust’s manager, which he owns with CEO Darren Holland, for $143 million. But the internalisation of the Aventus Property Group will likely cast further doubts over the outlook … Continue reading

25 Sept 2018 (AFR) – Mobile commerce now 25 pc of online sales: PayPal

(25 September 2018, AFR, p18, by Sue Mitchell) ‘…According to PayPal’s latest mobile commerce report, one quarter of all online sales are now taken via mobile devices, up from 19 per cent a year ago and 13 per cent in 2016, and about 72 per cent of Australian consumers are using their mobiles to pay … Continue reading

25 Sept 2018 (AFR) – ME CEO Jamie McPhee says house prices will keep sliding for two years

(25 September 2018, AFR, p17, by James Frost) ‘ME chief executive Jamie McPhee expects house prices to edge lower for up to two years following several years of strong growth in the major metropolitan markets of Melbourne and Sydney, but says there’s no reason to panic. “I don’t believe in the doomsday scenarios where house prices … Continue reading