Well into the penultimate quarter of the calendar year, institutional and private investors face the paradox that record infrastructure capital expenditure, particularly by AI hyperscalers, coexists with heightened geopolitical risk, sticky inflation, and an apparent structural shift to the relationship between equities and bonds.

And if institutions are changing their asset allocations to reflect these shifts, should private investors do the same? Continue…

by Roger Montgomery Posted in Economics, Editor's Pick, Feature Article, Insightful Insights, Investing Education.

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If you haven’t noticed already, allow me to point out that investment discussions about artificial intelligence (AI) frequently devolve into almost insulting debates between AI evangelists, who cite massive total addressable markets (TAM) and explosive user growth, and sceptics, pointing to trillions of dollars in capital expenditure (capex), a buildout based on speculation, exorbitant compute costs, and an unclear path to profitability.

Aswath Damodaran, NYU Stern professor and widely respected value investor, believes this debate has largely gone off the rails, noting in a recent post, “The debate about AI, in my view, has gone off the track with advocates and sceptics often talking past each other”. Optimists cherry-pick usage metrics, while pessimists focus on heavy spending, with both sides ignoring the rigorous business analysis that needs to take place in the middle. Continue…

by Roger Montgomery Posted in Economics, Manufacturing, Market commentary, Market Valuation, Technology & Telecommunications.

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In public finance, there is a simple truth that ideologues spend years trying to evade: Eventually, the numbers catch up with you.

Back in the late 1980s and early 1990s, when I was studying at University in Melbourne, the economic mismanagement of the Kane and Kirner Labor governments reduced what was then called the Garden State to an economic basket case.

Decades later and Labor has done it again, hitting Victoria hard.

When Labor came to power there in 2014, the state’s debt was $21.8 billion. Today, it exceeds $160 billion and is rapidly approaching $200 billion, making Victoria one of Australia’s heaviest financial ball-and-chains. Continue…

by Roger Montgomery Posted in Economics, Insightful Insights, Market commentary.

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In my article for The Australian, I look at why many Australians are feeling worse off despite the economy continuing to grow. Rising living costs, expensive housing and weak productivity are making it increasingly difficult for households to get ahead.

I also discuss how government decisions around housing, taxation and spending may be adding to these pressures, with younger Australians in particular facing higher rents, falling affordability and greater financial strain.

Download the article here: Labor’s economics making us all poorer Continue…

by Roger Montgomery Posted in Economics, Editor's Pick, In the Press, Market commentary.

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There’s a consistent view of the consumer emerging from Australia’s Financial year 2026 (FY26) retail reporting season.

Households haven’t stopped spending, but they’ve become more selective, more value-conscious and increasingly willing to postpone discretionary purchases or wait for promotions and sales.

The pressure is most evident in big-ticket categories like furniture, appliances, and homewares. Nick Scali (ASX:NCK) noted a significant decline in store traffic late in the year; JB Hi-Fi (ASX:JBH) mentioned that customers are focusing their purchases around major sales; and Temple & Webster (ASX:TPW) said that while browsing continues, customers are delaying their buying decisions. Continue…

by Roger Montgomery Posted in Companies, Consumer discretionary, Economics, Editor's Pick, Manufacturing, Market commentary, Market Valuation.

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I joined Jess Maguire on ABC Statewide Drive to discuss why traditional approaches to diversification may no longer offer investors the same protection they once did. We explored how persistent inflation has changed the relationship between shares and bonds, the growing concentration of global share markets in a handful of artificial intelligence (AI) linked companies, and why investors may need to diversify beyond traditional asset classes and markets by considering a broader range of investment strategies.

Listen to the full segment from 1:46:20 – ABC Statewide Drive Continue…

by Roger Montgomery Posted in Economics, Insightful Insights, Investing Education, Market commentary, Market Valuation, Radio.

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I joined Juliette Saly on Ausbiz to discuss why traditional approaches to diversification may no longer provide the same protection for investors. We explored persistent inflation, growing concentration in equity markets, the risks emerging around AI and hyperscaler spending, and why investors may need to look beyond the traditional 60/40 portfolio towards alternative strategies, including private credit.

Watch the full episode on Ausbiz here: Why Roger thinks 60/40 diversification is dead Continue…

by Roger Montgomery Posted in Aura Group, Economics, Investing Education, Market commentary, TV Appearances.

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As I have written many times, Australia’s Household Debt to Disposable Income Ratio has jumped more than fourfold to around 180 per cent over the past 50 years, making us one of the more indebted societies of the 38 Organisation for Economic Co-operation and Development (OECD) countries.

Preeminent financial journalist of many decades, Robert Gottliebsen, recently argued a 10 per cent decline in house prices was the equivalent to around three 0.25 per cent interest rate increases for the average Australian consumer. Continue…

by David Buckland Posted in Consumer discretionary, Economics, Editor's Pick, Energy / Resources.

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