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Macro Afternoon
As Trump makes one of the most retarded economic decisions of all times with his blanket tariffs (even on uninhabited islands, but not Russia curiously), in effect self-sanctioning the USA from global trade, risk markets have done their fair share of pearl clutching and crystal ball gazing to wonder if stagflation, recession or something else
Business group lowballs low-paid workers
The annual minimum wage circus has begun, with the Australian Industry Group (AIG) urging the Fair Work Commission (FWC) to adopt a “moderate increase” in minimum wages of not more than 2.6%: “In recent years, high inflation resulted in very large increases to minimum wages. But in 2025 the balance of economic factors has squarely
Australia well-endowed with Rudd alternative
Australia’s tea lady in Washington, Kevin Rudd, has failed again. SMH. Prime Minister Anthony Albanese has made an eleventh-hour bid to avoid the worst of US President Donald Trump’s trade strikes by enlisting the advice of one of the most influential Australians in Trump’s orbit, golf star Greg Norman. Albanese dined with Norman in Melbourne
Victorians pay for endless waste and mismanagement
Victorian taxpayers seem to be unable to catch a break. The state is grappling with the nation’s highest per capita debt loads. Victoria’s net debt is forecast to soar over the budget forward estimates. As a result, interest payments have soared, draining billions from the state budget. Central to Victoria’s financial demise is poor management
BHP reads iron ore its last rites
The ferrous jaws remain. BHP has delivered iron ore its last rites. BHP (ASX:BHP) Group (NYSE:BHP), the world’s largest publicly traded mining company, is reportedly contemplating the separation of its Australian iron ore and coal divisions. This potential move is part of a mid-term growth strategy, as per Reuters. BHP Group’s potential spinoff of these
MB Fund Podcast: Liberation Day Fallout
Join us this week as Nucleus Wealth’s Chief Investment Officer, Damien Klassen look at what we know about Trump’s new tariffs, what they mean for the stock market and our thoughts on the market effect. Can’t make it to the live series? Catch up on the content via Podcasts or our recorded Videos. Damien Klassen is Chief Investment Officer
How to break the gas cartel
Jennifer Hewitt writes a reasonable piece on the gas crisis, but her conclusion is rubbish. AFR. …blaming the LNG export industry for high power prices is an easy political target despite the extraordinary complexity and commercial self-interest in the gas market. At various times since, both Coalition and Labor governments have attempted to make up
Peter Dutton is doing his best to throw the election
Peter Dutton’s excellent East Coast gas reservation policy is being undermined by policies that few voters asked for and that the mainstream will never support. On Wednesday, Dutton announced that a Coalition government will crack down on “waste and rorts” in government spending, which Labor has argued means cuts to essential services, including health and
How can the Grattan Institute still support high immigration?
Grattan Institute CEO, Aruna Sathanapally, told ABC’s Q&A that Australia’s failure to build enough housing was “at the heart of our economic problems”: “We can see that the wealth of higher-income Australians or higher-wealth Australians has turbocharged, particularly due to housing prices. It’s property prices that’s led to that increase in wealth. And we haven’t
The upside and down of Trump tariffs
Terrific video here on how Trump’s tariffs are aimed at working while the fallout is in the implementation. The reciprocal tariffs announced today do not have the subtlety required. CBA explains the tariffs as follows: President Trump has announced reciprocal tariffs against all countries. The level of duty will be half of what the US
The math doesn’t add up for Australian housing
The federal government’s housing accord commenced on 1 July 2024 and aims to construct 1.2 million dwellings over five years, equivalent to 20,000 homes per month. On Wednesday, the Australian Bureau of Statistics (ABS) released dwelling approvals data, which revealed that 15,400 homes were approved for construction in February, 4,600 (23%) below the target. Over
Aussie mediocrity is turning fatal
This is another pointless debate, as usual. The Reserve Bank governor has contradicted Labor’s claims that wages can continue to rise without productivity gains, as the Albanese government pushes for an above-inflation increase for 3 million workers on minimum rates this year. Labor’s submission to the Fair Work Commission’s annual wage review calls for an
Australian dollar gazumped by tariff shock
DXY is falling again after Liberation Day tariff announcements. AUD was up big, down big, then did little. Lead boots will be interesting today. Gold to the moon. Oil toppy. Base metals are screaming “hard landing”. Big mining’s big bear knows no bottom. EM meh. Credit not stressed enough. Yields fell as growth worries mount.
Australian households remain buried in debt
Last week, the Reserve Bank of Australia (RBA) released Q4 2024 data on household debt. As illustrated in the chart below, the ratio of household debt to income was 182% in Q4 2024, tracking close to a record high. This was driven by mortgage debt, which was tracking at 135% of household disposable in Q4.
Australia has too many streaming services
Warner Bros Discovery’s Max streaming service debuted in an already-crowded Australian market on Monday. Warner Bros Discovery executive Jean-Briac Perrette is upbeat about the outlook for the sector, contending that streaming will be a “fantastic business”. “The streaming business, and the media business, to a large part, is moving towards a handful of successful, big
Stock robots squirm as hard landing builds
The Market Ear sees squirming robots. CTAs in US equities CTAs have aggressively sold US equities and are now estimated to be short $30bn. Not a huge number per se but we are at an interesting “extreme” level looking back over the past 10 years. This would be supportive evidence for a tactical long trade.
Labor continues to lie about power prices
Recall Labor’s Powering Australia Plan, which promised to reduce NEM wholesale electricity costs by $11 per MWh, from $62 to $51, by 2025. Prime Minister Anthony Albanese hailed this modelling by RepuTex Energy as “the most comprehensive modelling ever done for any policy by any Âopposition in Australia’s history since Federation”. Albanese also repeatedly spruiked that
Paralysed RBA to cut, cut, cut
Goldman’s Andrew Boak has been more right than everyone so far. In her post-meeting press conference RBA Governor Bullock noted that today’s decision to keep the policy rate unchanged at 4.10% was a consensus decision and that the Board did not explicitly consider a rate cut at the meeting. Importantly, Governor Bullock did not repeat
Young Aussies have been robbed of wages
Progressive think tank Per Capita has released a report criticising the low wage growth experienced by young Australians, which has prevented them from purchasing a home. Per capita claims young Australians have suffered from a “lost decade during which real wages barely grew”. At the same time, home ownership rates for younger Australians collapsed. “In
Gas goons on the run
The gas goons are on the run. Reuters. At a conference in Sydney, Australian executives of Shell (SHEL.L), opens new tab , ExxonMobil and Chevron (CVX.N), opens new tab pushed back on the coalition’s proposal, arguing more government intervention would hamper the development of gas supply. These people are like a broken record. They will do as they are
Sham migration agents allowed to run rampant
Last year, an Instagram video of a migration agent instructing rejected student visa holders how to appeal their decisions to the Administrative Appeals Tribunal (AAT) went viral. The video was deleted after a public backlash, but not before I transcribed its contents. Below is what the migration agent said via video: “What I have heard
Iron ore jaws widen again
The jaws are back as steel falls while iron ore rises. MySteel sparked the rally. “A further increase in the hot metal output at Chinese steelmakers lent some support to the prices of imported iron ore last week,” said Chinese consultancy Mysteel. Hot metal production in March continued to increase by 10,200 tons to 2.3728
A long recession for Australian households
The Q4 2024 national accounts from the Australian Bureau of Statistics (ABS) showed that Australian households remained trapped in recession. As illustrated by the blue bars below, real per capita household consumption declined for an eighth consecutive quarter in Q4. The decline in per capita household consumption followed an even steeper decline in incomes. As
Australian Made campaign is futile without affordable energy
The Australian Made Campaign has welcomed additional funding of $20 million in last week’s federal budget. Amongst other things, this funding will allow the organisation to launch a new campaign to encourage more Australians to buy locally made products, and assist more local manufacturers and producers to obtain Australian Made certification. “This level of support