Website improvements

Hi all, A quick note to offer guidance on the new website. As well as the layout changes that make it easier to access content for new readers, it comes with a dramatically improved sign-up and resubscription process, greatly enhanced speed, and a much better mobile experience (since 95% of traffic is now phone!). The

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Macro Afternoon

The rocky start to the trading week is deepening with stock markets in Asia losing significant ground in response to the escalation in conflict across the Middle East, with a further spike in USD and bond yields. The latest Chinese GDP print did little to assuage risk sentiment either. The Australian dollar is trying to


Migration cuts announced amid productivity falls

Statistics New Zealand has released data showing that productivity has collapsed amid the record surge in net overseas migration. “Inputs rose at a higher rate compared with outputs in the year ended March 2023, resulting in decreases in both labour and multifactor productivity”. “Labour productivity fell 0.9%. Labour productivity captures how output relates to changes


Hospitality wage thieves fight migration crackdown

Last year, the Albanese government vowed to streamline the list of occupations eligible for employer-sponsored visas. The first draft of the new job list, devised by the government agency Jobs and Skills Australia (JSA), reportedly omits chefs, cooks, bakers, and managers, which has angered the hospitality industry. The hospitality industry is now gearing up for


Australia’s rental crisis will keep getting worse

In this interview with Luke Grant from Radio 2GB, I discuss the latest disastrous rental and construction data, which suggests that Australia’s rental crisis will worsen. I also discuss the latest polling showing that Australians categorically reject Big Australia immigration. Edited Transcript: Domain released its March quarter rental report, and the combined capital city house


Economists denounce Albo’s “Made in Australia” white elephant

More economists have backed Productivity Commission chair Danielle Wood’s critique of the Albanese government’s “Future Made” subsidies for low-emissions manufacturing. Former Reserve Bank of Australia (RBA) governor Bernie Fraser contends that the plan represents a risk to taxpayers. He notes that governments do not have a good track record when it comes to ‘picking winners’


Cut work rights and watch international student volumes crash

South Asian students are a key driver of Australia’s record increase in net overseas migration. After the former Coalition Government relaxed the cap on international student work hours and extended the time VET graduates could stay in Australia after completing their degrees, the number of South Asian students arriving for work and residency increased dramatically.


Labor facing minority government

Two election polls show that the Albanese government is staring down the barrel of a minority government. An online AFR Freshwater poll of 1055 voters from Friday to Sunday shows that Labor’s primary vote stands at 31%, unchanged from the last poll a month ago, while the Coalition’s primary vote has risen one percentage point


Shocked! More people means more cars and emissions

In December 2022, The Australia Institute (TAI) complained that Australia’s transport emissions had risen above pre-pandemic levels, which it blamed on the uptake of SUVs and utes. “The government projects that by 2035, electric vehicles will account for 44% of new car sales compared to less than 1% in 2019. But despite this uptake, transport emissions


Stock crash as robots panic

The Market Ear on panicking robots. Breaching big levels On April 10, in our thematic email, We are getting close to a CTA selling tsunami, we pointed out the “sensitive” set up and wrote: ” Just a few points lower CTAs will for the first time this year start selling in size…to add insult to


Australian dollar shot down by Iran

DXY is up and away: AUD has been shot to the cliff’s edge: North Asia is a pair of lead boots: Do we run our cars on gold or oil? Goldman’s latest disgrace, squeezing copper and aluminium is sucking cash up the blood funnel: The world’s second largest iron ore dog is now its hottest


Macro Morning

Another hot US economic print plus continued war jitters across the Middle East caused Wall Street to pull back sharply again following the Friday night volatility. The USD pushed back against the undollars, although gold was able to rebound, while bond yields jumped to new highs across the curve. The Australian dollar made new lows


Iron ore crazy

Rebar was down yesterday and its only redeeming feature is its technical bounce from the 3300-3500 long term support area: Even Dalian  is starting to look tired: Port stocks are still rising and scuttlebutt is poor: “Given the remaining high steel stocks, a further increase in hot metal output might not be conducive to the


RBA will burn rates while Fed fiddles

Some sanity at last from Australia’s worst newspaper, the AFR: The Reserve Bank of Australia might have to cut interest rates before the United States, as persistently high inflation in the world’s largest economy casts doubt over whether the Federal Reserve can do anything this year. As the world’s most powerful central bank because of


Housing construction costs are out of control

CBA published the following chart last week, showing that Australian residential construction costs have soared by between 30% and 40% since the beginning of the pandemic: Independent economist Tarric Brooker posted the following chart on Twitter (X) showing the average construction cost of new homes across Australia: The average construction cost across Australia was 395,000


Macro Afternoon

A rocky start to the trading week with most stock markets in Asia losing significant ground in response to the escalation in conflict across the Middle East, with the spike in USD on Friday night seeing some undollars clawback their losses. Commodities and bond markets are still high in volatility while traders await tonight’s US


Reserve Bank caught in pincer on interest rates

David Chaston from Interest.co.nz believes that the Reserve Bank has been placed in a difficult position on interest rates, caught between a recessionary economy and stubborn services inflation. Chaston notes that New Zealand’s economy faces a “severe slowdown”. The economy is already experiencing a technical recession: And per capita outcomes are much worse given New


A better alternative to Albo’s “Made in Australia” boondoggle

Productivity Commission chair Danielle Wood has expressed concern about the federal government’s Future Made in Australia Act, claiming it risks entrenching industries that would always be dependent on government subsidies for their survival. Former Commission chairman Peter Harris agrees with Wood that “this is a slippery slope and most times the investment fails”. Bill Scales,


Aussie interest rate debate enters Twilight Zone

Challenger chief economist Jonathan Kearns believes Australia will be the last advanced nation to cut interest rates because the Reserve Bank of Australia (RBA) didn’t lift them as high as other nations. “Monetary policy was less tight in Australia than it was in other countries, and so therefore the disinflationary impetus coming from monetary policy has


Labor confronts international student tsunami

The Department of Home Affairs reported that there were a record 713,144 international students in Australia at the end of February 2024: It was reported last week that more than 80% of international students in Australia reside in the private rental market: “Universities have built enough dorm rooms to accommodate only 40,000 students nationally –


Canada and Australia caught in same economic trap

In the year ending September 2023, Australia’s population increased by a record 660,000 people, owing to a record high net overseas migration of 549,000. In percentage terms, Australia’s yearly population growth rate of 2.5% was the highest since 1952. Anyone living in Australia is aware of the implications, with the country dealing with the biggest


Chinese urbanisation collapses

I made the point last week in responding to local propagandists that Chinese urbanisation was on the verge of collapse: This is a simple case of demographic arithmetic, but the local’s livelihood prevents them from seeing the oncoming truck, so here are a few more charts from Dragonomics that make the same point. The recent


Israel, Iran and oil

Goldman with the note. While the geopolitical situation and the potential Israeli response remain highly uncertain, we provide early thoughts on how Iran’s attack on Israel may impact the oil market in Q&A format. Q1. What are the key factors driving any potential reaction in oil prices to the events over the weekend? The medium-run


Victoria plunged deeper into homelessness crisis

Victoria has the lowest proportion of social housing in Australia, accounting for only 3% of total homes. That is far lower than the national average of 4.2%, which is already low by worldwide standards. Last month, The Guardian reported that Victoria’s homelessness crisis is the worst in the nation and continues to deteriorate. “Victoria still


Aussie consumer buckles anew

The Westpac credit card tracker makes the point. The Westpac Card Tracker Index* declined 1.9pts over the two weeks to April 6. At 133.7, the latest Index read is only slightly above the low seen at the start of March. While quarterly growth momentum is still positive, and materially improved on the weakness seen around