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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Jun 16, 2017 3:37 am 
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Property market aside the threat of recession seems to reside on recent figures.
The madness continues........though slowed down somewhat......only time will tell if it is yet another false flagging of a bubble bursting

https://www.qt.com.au/news/man-bids-aga ... t/3190370/

Quote:
A MELBOURNE man has stunned onlookers after repeatedly bidding against himself at auction to buy a house.

Ben Cohn used a unique strategy of upping bids every 10 seconds - and even bidding against his own - while holding his arm up for the entire 20-minute auction.

Mr Cohn and his fiance Noga went to the auction for their dream house in Ripponlea last month.

But Mr Cohn shocked the auctioneer, other bidders - including a seasoned property investor - and about 100 onlookers, when he started placing bids against himself.

"I think most people in the crowd thought I was crazy," Mr Cohn said.

"As soon as they bid, I bid straight up against them by $1000, waited 10 seconds then bid another $1000, and kept doing that."

"The longer they waited the more I put in additional incremental bids to try to effectively put them off."

But the innovative 32-year-old said it was all part of the strategy


'innovative' :|

http://www.theaustralian.com.au/busines ... 40b58b9bcf

Quote:
Housing markets in Sydney are beginning to show more signs of slowing than those in Melbourne, as the gap in auction clearance rates between the two cities grows.

In Sydney, 71 per cent of homes auctioned on the Queen’s Birthday long weekend sold under the hammer, falling from a clearance rate of 74 per cent at the same time last year.

Melbourne’s auctions moved in the other direction with 77 per cent of homes sold, compared with 64 per cent a year ago in what is traditionally one of the quietest weekends of the year for both markets.


here is the bearish view on the employment figures:

http://thenewdaily.com.au/money/work/20 ... yment-may/

Quote:
Underemployment is at its highest level since records began in the 1970s, but you won’t have heard it on the TV.

Thursday’s headlines were instead dominated by news that Australia’s official unemployment rate had fallen from 5.7 per cent in April to a four-year low of 5.5 per cent in May


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 Post subject: Re: Ominous signs in Australia
PostPosted: Mon Jun 19, 2017 12:18 pm 
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Quote:
Credit rating agency Moody's has downgraded a dozen Australian banks, including the big four, citing increased risks in the nation's increasingly indebted households.

Moody's stripped the big four banks - the Australia and New Zealand Banking Group (ANZ), Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), and Westpac Banking Corporation (Westpac) - of their Aa3 long-term rating and placed them on the next level down at Aa2, although it did not alter their short term ratings.




http://www.smh.com.au/business/banking- ... wuafj.html


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Jun 21, 2017 1:44 am 
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Quote:
Residential property prices rose 2.2 per cent in the March quarter 2017, the fourth consecutive quarter of growth, according to figures released today by the Australian Bureau of Statistics (ABS).

Program Manager for Prices Branch, Marcel van Kints, said; "While residential property prices rose in most capital cities this quarter, Sydney and Melbourne continue to drive the national result."

The price rises in Sydney (3.0 per cent) and Melbourne (3.1 per cent) were partially offset by falls in Perth (1.0 per cent) and Darwin (0.9 per cent).

Through the year growth in residential property prices reached 10.2 per cent in the March quarter 2017. Sydney recorded the largest through the year growth of all capital cities at 14.4 per cent, followed closely by Melbourne at 13.4 per cent.

The total value of Australia's 9.9 million residential dwellings increased $163.1 billion to $6.6 trillion. The mean price of dwellings in Australia is now $669,700.


http://www.abs.gov.au/ausstats/abs%40.n ... enDocument


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Jun 21, 2017 11:05 am 
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KPMG:

Quote:
Sydney median prices are forecast to peak at $980,000 in 2019, up from $880,000 from June 2016, and then gradually roll back to between $930,000 and $950,000 by the end of the 2021 financial year.

However, Melbourne prices are expected to peak next year, pause for year or two, and then start to grow again.

The median prices in Melbourne are expected to rise to between $720,000 to $740,000, from about $650,000 in 2016, by the end of 2019. After plateauing, they will then regain momentum to be between $775,000 and $825,000 by the end of 2021.

“Our forecasts show Sydney will experience a greater adjustment than Melbourne in the next few years, but this is likely to be gradual rather than a collapse in the median dwelling price,” says Brendan Rynne, KPMG chief economist.

Read more at https://www.businessinsider.com.au/kpmg ... vjkEfoE.99


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Jun 21, 2017 11:18 am 
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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Jun 22, 2017 6:09 am 
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Quote:
Employment rose by 133,500 in the three months to May, the biggest quarterly gain in jobs for over two years.

Most of the new jobs were created in services, with healthcare the leading sector, followed by hospitality and professional, scientific and technical services, according to the latest numbers from the ABS.


Quote:
Construction, mining and finance were among the sectors to shed jobs over the past three months.

"The good news is that both job ads and job vacancies are holding near six-year highs, in addition business conditions are near the best in nine years with profits at record highs. So job growth is set to continue," said CommSec chief economist Craig James.

Healthcare remains Australia's biggest employer with 1.58 million employees (13.0 per cent of the total) followed by retail trade (1.23 million jobs or 10.1 per cent) and construction (1.10 million or 9.0 per cent).


Quote:
Housing construction employment has (directly) accounted for 14% of jobs growth over past 4 years.

http://www.smh.com.au/business/markets- ... ww1er.html

Image

For comparison, Ireland had double the amount in construction
Image

However its been holding up the unemployment rate in Australia which would otherwise be dropping

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Source for graphs: ex RBA economist https://twitter.com/justinfabo

Even if the 9% is a normal healthy amount it would destroy the property market because supply meeting demand would eliminate capital appreciation pulling the rug from under it all
Anything that changes the market demand from 50% investors will cause a crash and seriously affect the banks and ASX and Australian economy.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Jun 22, 2017 6:14 am 
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A very interesting thing is the NSW budget surplus and its planning expenditure

http://www.news.com.au/finance/business ... 4f685e86c1

Quote:
The state posted a surplus of $4.5 billion for the current financial year, thanks mainly to the booming housing market and one-off transfer duty payments from asset sales.

Transfer duties, which make up more than 30 per cent of the government's tax revenue, far exceeded expectations in 2016/17.

This was primarily driven by a 9.6 per cent jump in revenue from residential stamp duty but also included one-off transfer duty payments from the partial lease of Ausgrid and Endeavour Energy during the year.


and how does coal mining/exports compare to selling assets off and property bubble bonanzas:

Quote:
Higher than expected coal export prices also boosted royalties by about $300 million to $1.56 billion for the year


http://www.smh.com.au/nsw/nsw-budget-20 ... wu3ul.html

Quote:
The Treasurer, Dominic Perrottet, said about 75,000 homes were expected to be built next financial year, double the long-term average of 40,000.

"We are about to embark on a construction boom," Mr Perrottet said.


Quote:
Included among the budget measures are another $118 million over the next four years to "deliver new infrastructure, housing and employment initiatives, review land use and infrastructure strategies for priority growth areas."


Quote:
Another $19 million will be used to support the construction of 30,000 new homes in priority precincts in Sydney. And almost $70 million of increased spending will be allocated to fast-tracking the assessment of major projects, and helping merged local councils run planning systems.
This funding will be partly spent on "a specialist team to re-zone and to help councils accelerate re-zonings," the budget papers say


FYI Western Australia had a deficit of 3 billion after the mining and property bubble burst
http://www.theaustralian.com.au/nationa ... 52d1b7ef18


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Jun 22, 2017 6:53 am 
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Quote:
Just what investors in the big banks needed: Australia's big four plus Macquarie will be hit with a new state-based version of the major bank levy which will reap $370 million over the next four years for the South Australian government as it ramps up spending on infrastructure in a struggling economy.

South Australian Treasurer Tom Koutsantonis said the banks were fair game for the states as well as the Federal Government. He has imposed a new South Australian major bank levy equal to the state's share of liabilities which are subject to the federal major bank levy.

"Even if every other state follows they'd still be under-taxed," Koutsantonis said of the banks.


http://www.smh.com.au/business/markets- ... ww1er.html


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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Jun 23, 2017 2:22 am 
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http://www.smh.com.au/business/workplac ... ww6jj.html

So the jobs created are low paid while the jobs lost were high paid..............

Quote:
Accommodation and hospitality have bolted to become among the country's fastest-growing job creators, adding more than 40,000 jobs each over the year to May.

But they are also driven by the nation's cheapest hires, perpetuating Australia's torpid low wage growth as higher-paid jobs in finance and utilities are cut.

"The quarterly data shows that the economy is creating mostly jobs that are below average in terms of earnings," said Citibank economist Jane Clapcott.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Jun 23, 2017 4:43 am 
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Quote:
researchers at investment bank Citi revealed one large developer giving new apartment owners a 5 per cent 12-month rental guarantee and paying the $25,000 stamp duty bill on a $495,000 one bedroom unit.

The developer was also throwing in a package to buy furniture worth $11,000, they said.

Australia's looming apartment glut has prompted developers to offer potential buyers significant discounts with rental guarantees, free furniture and appliances, upgrades to fixtures and significant stamp duty concessions now common



http://www.smh.com.au/business/property ... wx1gt.html

pop


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 Post subject: Re: Ominous signs in Australia
PostPosted: Mon Jun 26, 2017 3:26 am 
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Quote:
So much for that May slowdown. House prices have again lifted in Sydney and Melbourne, with the median price of a house sold in the Harbour City now at $1,000,500.

In Melbourne, the median house price was $715,549, according to the latest data from property information group CoreLogic.

Sydney's home values rose slightly more than Melbourne's - up 1 per cent compared to its southern rival's 0.8 per cent - in the week to June 25, from the previous week. But the value of homes eased in Brisbane, Adelaide and Perth, with Adelaide dropping 1 per cent, the Queensland capital losing 0.3 per cent and Perth declining 0.2 per cent compared to the week before.


http://www.smh.com.au/business/markets- ... wydmk.html


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Jun 28, 2017 4:41 am 
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Borrowers could be hit with at least eight interest rate hikes in 2018 and 2019 if the economy rebounds as the RBA anticipates, says former central bank board member John Edwards.

Warning that the "time is coming to get back to normal" monetary policy, Edwards said the current cash rate is "way below where it will need to be in years to come".

As the economy returns to its normal pace of just over 3 per cent growth, inflation will return firmly to the 2 to 3 per cent Reserve Bank target range, raising pressure on policy makers to hike.

According to an article penned by Edwards for the Lowy Institute, normalisation means lifting the official cash rate by 2 percentage points to 3.5 per cent. That would take the average mortgage rate from around 5.3 per cent to well over 7 per cent.

That could add more than $640 to the monthly repayments for a family with a 25-year $400,000 mortgage, or $8200 a year.


"If inflation does indeed return to 2.5 per cent, as the bank now expects, if growth does indeed return to 3 per cent 'within a few years', as the minutes of the June board meeting predict, if the world economy is indeed picking up, then a policy rate of 1.5 per cent is too low," Edwards writes.

"It seems to me that something like eight quarter percentage point tightenings over 2018 and 2019 are distinctly possible, if the RBA's economic forecasts prove correct.


http://www.smh.com.au/business/markets- ... x00c8.html


damned if the economy picks up, damned if it doesn't


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Jun 28, 2017 10:17 am 
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Blindjustice BATONEFFECT wrote:
damned if the economy picks up, damned if it doesn't


I've still never been able to understand what the exit strategy from a zero interest rate environment can ever be when debt levels are high.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Jun 28, 2017 11:11 am 
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johnp002 wrote:
Blindjustice BATONEFFECT wrote:
damned if the economy picks up, damned if it doesn't


I've still never been able to understand what the exit strategy from a zero interest rate environment can ever be when debt levels are high.


Helicopter money?

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People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.


Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations
Book I, Chapter X, Part II,


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Jun 28, 2017 11:57 am 
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Madness of Crowds wrote:
johnp002 wrote:
Blindjustice BATONEFFECT wrote:
damned if the economy picks up, damned if it doesn't


I've still never been able to understand what the exit strategy from a zero interest rate environment can ever be when debt levels are high.


Helicopter money?

That would be my thinking too. QE and ZIRP has funnelled money to people who don't need it to buy assets that others have to use loans that bear interest to buy.

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If you want to improve, be content to be thought foolish and stupid.
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