Energy / Resources
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China Watch #2
Roger Montgomery
February 19, 2015
Recently Australian Financial Review Journalist Angus Grigg reported an interesting admission by a director at China’s State Administration of Foreign Exchange (SAFE). It’s a big deal for a SAFE official to be making such statements publicly.
Here’s the highlights: continue…
by Roger Montgomery Posted in Energy / Resources, Foreign Currency, Insightful Insights.
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Do Property Prices Ever Fall?
Roger Montgomery
February 11, 2015
It was December 14, 2011. The Australian Resource Boom was in full swing and the Pilbara was ground zero. In Port Hedland the median house price had almost doubled in four years from $600,000 in 2007 to more than $1 million, according to Real Estate Institute of WA figures. In Wedge Street, you needed plenty of ‘wedge’ – $995,000 to be exact – to buy a brand new ‘off the plan’ two-bedroom unit in a multilevel apartment complex.
by Roger Montgomery Posted in Energy / Resources, Insightful Insights, Property.
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WARNING: Will Tony Abbott (and You) Survive This?
Roger Montgomery
February 10, 2015
In the media last week, we emphasized the prospects for a hard landing in Australia. Being tied, by commodities, to the slowing growth of China puts Australia in the path of a serious economy malaise. Since 2010 we have been warning investors about the declining iron ore prices, Australian dollar and employment prospects. Back then China’s growth was being advertised at 12 per cent – fuelled in no small part by the property glut that was under construction. continue…
by Roger Montgomery Posted in Energy / Resources, Global markets.
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Is there early pressure from the collapsing oil and gas price?
David Buckland
February 6, 2015
In late 2013, I wrote a number of blogs on Liquefied Natural Gas (LNG) concluding that unless the industry cost structure in Australia changes and productivity improves, there are unlikely to be any new offshore “green field” LNG projects, except for Floating LNG facilities. continue…
by David Buckland Posted in Energy / Resources, Insightful Insights, Technology & Telecommunications.
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The oil price slump and the declining rate of inflation
David Buckland
January 27, 2015
The slump in the oil price since mid-2014 has seen global inflation rates continue to trend down. European consumer prices fell an annual 0.2 per cent in December 2014 and European Central Bank president continues to “do whatever it takes” by unveiling a 1,100 billion Euro (US$1,250 billion) bond buying program over 2015-2016. continue…
by David Buckland Posted in Energy / Resources, Foreign Currency, Insightful Insights.
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Greased Lightning
Ben MacNevin
January 23, 2015
The sudden fall in the oil price in the December 2014 half-year was unexpected by the market, but the speed of contraction in oil-related investment should come as no surprise. As the German economist Rudi Dornbusch observed, “In economics, things take longer to happen than you think they will and then happen faster than you thought they could”. continue…
by Ben MacNevin Posted in Energy / Resources, Insightful Insights.
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Is it time to look at mining services?
Tim Kelley
January 23, 2015
Among the biggest casualties of falling resources capex have been the various engineering, contracting and construction firms that provide services to the resources sector. Monadelphous (ASX: MND) is a case in point: With strong demand to fuel its growth, the Mondaelphous share price rose 50-fold in the decade leading up to 2012. Over the last few years however, a decline in earnings has seen the share price fall by around 70 per cent – a painful drop in any language. continue…
by Tim Kelley Posted in Energy / Resources, Insightful Insights, Property.
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Key issues for 2015
Roger Montgomery
January 5, 2015
In December I wrote an article for the ASX Investor Update, I thought I would share my thoughts with you as a welcome back to the year ahead.
What you should be watching out for in 2015 and what to expect with property prices, index funds and shares. continue…
by Roger Montgomery Posted in Companies, Consumer discretionary, Energy / Resources, Financial Services, Insightful Insights, Investing Education.
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Are you throwing the baby out with the bathwater?
Roger Montgomery
December 22, 2014
As we start to turn our minds to a well-earned break, we cannot help to ponder what the year ahead might unearth and whether we’ll find something useful and attractive that others have thrown out.
What we know today however, is that Materials and Energy stocks are under the pump from rising supply and falling demand. Some of them, along with those in the mining services game, will shutter operations or go broke – don’t forget there are over 700 mining services companies in Australia and 90 per cent of them are unlisted. Given that China is forecast by the US Conference Board to be growing at only 5.5 per cent in the next few years and by 3.5 per cent in the years to 2025, it is difficult to see any rapid turn around in the economics of materials exploration, mining and production. continue…
by Roger Montgomery Posted in Consumer discretionary, Energy / Resources, Financial Services.
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Virtuous and Viscious Cycles
Ben MacNevin
December 19, 2014
For the past decade, the energy sector and Emerging Markets have been fuelled by a growing China. Now, as China slows and the oil price plummets, the feedback loop has turned decisively viscious. But after having it so good for so long, have today’s market participants fully understood the downside risk? continue…
by Ben MacNevin Posted in Energy / Resources.
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