Economics
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How to think about this correction
Roger Montgomery
August 13, 2024
In presidential campaign speeches in 1959 and 1960, John F. Kennedy noted, “In the Chinese language, the word “crisis” is composed of two characters, one representing danger and the other, opportunity.” It’s not quite correct but that didn’t stop the handy anecdote becoming a popular trope adopted by business consultants and in motivational speeches and calls to action. continue…
by Roger Montgomery Posted in Economics.
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- POSTED IN Economics
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China’s deflationary environment – the iron-ore price and further downside?
David Buckland
July 31, 2024
Over the past 17 years, Chinese economic growth has decelerated from an approximate average annual 10 per cent to sub 5 per cent, whilst the Shanghai Composite Index has halved to under 2,900 points. Pressure on the Chinese residential property market and China’s ten-year bond yield at 2.1 per cent has been well highlighted, whilst the slowdown in sales from many big brand businesses is pointing to a deflationary environment, yet to be fully reflected in the iron-ore price. continue…
by David Buckland Posted in Economics, Global markets.
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- POSTED IN Economics, Global markets
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The uneven effect on households
David Buckland
July 12, 2024
The easing cycle for the Western world has thankfully begun with each of the Canadian Central Bank, the European Central Bank and the Swedish Central Bank cutting their official cash rate by 0.25 per cent to 4.75 per cent, 4.25 per cent and 3.75 per cent, respectively. continue…
by David Buckland Posted in Economics.
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- POSTED IN Economics
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ABC NEWCASTLE MORNINGS – FINANCIAL INSIGHTS
David Buckland
July 10, 2024
In this week’s interview with Paul Turton on ABC Newcastle radio, we discussed the disconnect between the share market and the broader economy, noting reasonable retailer profits despite rising living costs and declining discretionary spending. We covered the interest rates and the prevalence of variable home loans in Australia. The economy is slowing, with unemployment at a two-year high and discretionary spending low, yet sentiment for technology and artificial intelligence (AI) remains positive, with indexes at all-time highs. We also touched on how super funds might not fully benefit from the share market boom, even as industry super funds grow larger. continue…
by David Buckland Posted in Economics, Radio.
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- POSTED IN Economics, Radio
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The Aussie economy and society is bifurcating with the housing crisis
David Buckland
July 4, 2024
Australian governments at all levels are not known for thinking beyond the electoral cycle. Take the fact that Australia took on 540,000 immigrants last year, whilst births exceeded deaths by 110,000. Hence an additional 650,000 Australians, or 2.5 per cent of our population, at a time when our country is going through an unprecedented housing crisis. continue…
by David Buckland Posted in Economics, Editor's Pick, Property.
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- POSTED IN Economics, Editor's Pick, Property
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FAREWELL FISCAL 2024, HELLO FISCAL 2025
David Buckland
July 2, 2024
The Magnificent Seven (Alphabet (NASDAQ:GOOG), Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL), Meta (NASDAQ:META), Microsoft (NASDAQ:MSFT), Nvidia (NASDAQ:NVDA), and Tesla (NASDAQ:TSLA), which rose by an average 111 per cent over calendar 2023, continued their strong upward trajectory, increasing a further 37 per cent, on average, over the six months to June 2024. This helped drag up the Nasdaq, which jumped 18.1 per cent and 28.5 per cent for the 6 and 12 months to June 2024, respectively. The S&P 500 also did very well, up 22.7 per cent for the year and up 14.5 per cent for the six months to June 2024. continue…
by David Buckland Posted in Economics, Editor's Pick, Foreign Currency.
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- POSTED IN Economics, Editor's Pick, Foreign Currency
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Discretionary expenditure is starting to bite
David Buckland
July 1, 2024
The 13-interest rate increases by the Reserve Bank of Australia (RBA) in the 18 months to November 2023, combined with the bounce in inflationary expectations is starting to bite. Any company associated with discretionary expenditure missing its guidance from the slowing economic environment and cost-of-living pressures is being brutally dealt with by the share market. continue…
by David Buckland Posted in Economics.
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ABC NEWCASTLE MORNINGS – Global market insights
David Buckland
June 25, 2024
In this week’s interview with Paul Turton on ABC Newcastle radio, we discussed several key financial trends and their global impacts. We covered the significant growth of the S&P 500 over the last four years, driven largely by technology stocks and the artificial intelligence revolution. We also delved into the current economic climate in Australia, examining the rising inflation and consumer price index (CPI), and how these factors are influencing discretionary spending and mortgage interest rates. Additionally, we explored the dynamics of the Chinese economy, focusing on the implications of Australia’s coal and iron ore exports to China. continue…
by David Buckland Posted in Economics, Editor's Pick, Radio.
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U.S. public debt (part 2)
David Buckland
June 24, 2024
With the U.S. official cash rate remaining in the 5.25 per cent to 5.50 per cent range and the U.S. consumer price index rising at an annual pace of 3.3 per cent in May, it appears the U.S. Federal Reserve (Fed) will be sitting on their hands over the foreseeable future as they wait for the rate of inflation to decelerate sustainably toward two per cent. continue…
by David Buckland Posted in Economics.
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- POSTED IN Economics
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20%-Off at Merivale yet to influence RBA economists
Roger Montgomery
June 20, 2024
I think it’s fair to say anyone with a mortgage or business loan would like to see some relief at the Reserve Bank of Australia (RBA) bowser. While rate cuts benefit those with loans, with real estate, and mortgages, rate cuts could push real estate prices up, further hindering those who are already validly complaining about affordability. continue…
by Roger Montgomery Posted in Economics, Editor's Pick.
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