The All-Ords was in a sideways trading range between early February and early August and then dived. Since then, it has not only rebounded but escaped its former range ceiling and is now trading at a record high. (more…)
Percy Allan (dec’d)
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Are America’s right and left converging on foreign policy?
The interview of Jeffrey Sachs, a Social Progressive, by Tucker Carlson, a Social Conservative, makes riveting viewing since its an insight to where the polar enemies of American politics may be converging on their big picture view of US foreign policy. (more…)
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In August the market dived, but then revived on rate hopes – Monthly economic and market review
The All-Ords share price index plunged 5.8% in the first two trading days of August and then rebounded 5.8% by 30 August. It ended the month just 0.3% short of where it started. (more…)
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Mood now upbeat in Australia, but downbeat in America – Monthly economic and market review
Two news items last week completely reversed the economic outlooks in Australia and America. (more…)
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America’s war machine: Unless Australia acquires nuclear weapons, why acquire AUKUS subs?
Nuclear-powered Virginia Class and AUKUS submarines are a useful deterrent only if they carry cruise missiles with nuclear warheads that can be launched from their unique vertical firing shaft. (more…)
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What happens now that Israel has formally rejected a two-state solution?
Given the Israeli Parliament’s overwhelming rejection of a two-state solution the world needs to recognise that it is no longer possible, at least in the short and possibly medium term. It’s a mirage that opinion polls show most Israelis and Palestinians don’t want. Given their long acrimony, the sad truth is that each side wants to overpower the other and have only one nation. (more…)
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Will a stranded Philippines’ ship trigger war with China?
China claims sovereignty over roughly 62% of the South China Sea (SCS) as delineated by a nine-dash line first published on a Chinese map in 1947. (more…)
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Market drift and rate rise threat – Monthly economic and market review
The Australian All-Ords index rose 8.3% during the financial year ending last Sunday. But Australia’s economy has had a dismal time with real GDP per capita contracting in each of the five quarters to March 2024. With annual CPI inflation rebounding after earlier falls, the market now expects the RBA to further dampen consumer spending by increasing its cash rate from 4.35% to 4.6% in either August or September. (more…)
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Guns, butter & taxes: hard choices, volatile economy
The Australian government needs to stand up against growing global protectionism and make some hard budgetary choices between guns and butter, defence and welfare, and the need to reform taxes if it is to avoid taking on too much at once in a world economy characterised by uncertainty and geopolitical tensions, and in an Australian economy treading a bumpy and narrow path balancing fiscal and monetary policy. (more…)
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Why inflation should soon resume falling
Let’s not goad the Reserve Bank to fight higher underlying inflation that can be corrected by disciplined fiscal policy and a more open and competitive economy. (more…)
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Stabilisation, but deeper relationship stymied by Australian mass media sinophobes
Chinese Premier Li Qiang’s visit underscores the significance of the Australia-China relationship, especially given China’s status as Australia’s largest trading partner. A deeper relation should develop, but that will take time. Trust needs to be reestablished not only at diplomatic and business levels, but also in the Australian mass media, whose China opinion writers have almost all become Sinophobes arguing that China is trying to subvert and attack its neighbours – including Australia, writes Percy Allan in an interview with China’s Global Times. (more…)
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War fears and rate worries: monthly economic and market review
Since my last report, the All-Ords share price index rose by 3.2% from Friday 3rd May to Thursday 16th May, but then fell by 2.2% to Friday 31st May. But for a 0.9% uptick last Friday there would have been no gain in the last four weeks. (more…)
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Who will win the US Presidential Election? Professor Lichtman may hold the key
The Guardian newspaper reports that history professor Allan Lichtman is known as the Nostradamus of US presidential elections since he has correctly predicted the results of nine of the past ten ballots. (more…)
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Monthly economic and market review
The Australian All-Ords share price index rose 0.3% last week after falling 2.9% the week before. The index had been yo-yoing sideways since it escaped its three-year channel ceiling at the end of February 2024, but a fortnight ago had a big drop bringing it back within its previous channel ceiling. Read Percy Allan’s monthly economic market review. (more…)
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Booming shares, but slowing economy – April market and economic review
Callum Thomas, editor of Top-Down charts sums it up well – “Sentiment is increasingly consensus bullish. Bears have all but gone extinct. Large and small investors alike are basically all-in. Tech stock valuations have surpassed the 2021 peak. Downside volatility has collapsed. Overall, the evidence is all consistent with what you typically see during a bull market.” (more…)
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Is China an Imperialist nation?
I was recently sent a complete list of China’s invasions of other countries in the last 2,245 years to demonstrated that China is historically an imperial nation and hence dangerous. (more…)
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America’s latest move to block China’s economic rise
US lawmakers have introduced a bill that would bar US mutual funds from investing in indexes that track Chinese stocks (Bloomberg). According to Bloomberg “The legislation targets mutual funds that invest in indexes tracking primarily Chinese stocks, rather than those investing in indexes that only include some Chinese companies, according to Sherman’s office. However, the lawmakers left it to the Securities and Exchange Commission to write rules that’d ultimately determine which products are impacted.” (more…)
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Global economic and financial review
The American economy is strong, Australia’s economy has slowed to a standstill, and Xi Jinping is proving to be a dry economic rationalist rather than a warm indulgent socialist. Read on for this week’s global economic and financial review.
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Boom or bubble: March market and economic review
Last Friday the All-Ords share index finally escaped its straitjacket of see-sawing sideways within a range of roundly 6,600 to 7,900 since April 2021. The All-Ords reached 8007.1 points, beating its previous high on the 4 January 2022 (7926.8). See chart below. Technical analysts view this breakout to be a particularly good omen. (more…)
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Is China repeating Australia’s mistake on Indigenous Affairs?
The South China Morning Post recently published an illuminating article on China’s policy towards ethnic minorities, with a particular focus on Inner Mongolia that has strived hardest to assimilate its Mongols with the rest of the Chinese population to promote a single national identity. But does China’s policy reflect the assimilation policies towards First Nations that Australia adopted in the 1930s and has now come to regret?
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Tribute to a great public sector reformer, Don Nicholls AM
My late friend and mentor Don Nicholls was one of the great public servants of NSW where he was Chief Economist and then Deputy Secretary, NSW Treasury. (more…)
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China’s worrying economic policy drift
The Rhodium Group, an independent research organisation with a focus on China, says the nation’s economic policymaking process has stalled with it refusing to announce meaningful actions to overcome its pressing property and share market crashes let alone forge a clear path for the future. The full paper can be accessed here. (more…)
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Why Yang Hengjun should be released – he’s Walter Mitty not James Bond!
The standard media news bite is that Yang Hengjun is a Chinese born Australian pro-democracy writer who was unlawfully detained and now jailed for life in China. But the full story is murkier than that.
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Record highs: February market and economic review
Not only has the stock market shaken off its new year hangover but the All-Ords is now higher than after its Santa Rally in December 2023. Indeed, it has reached a record high. (more…)
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Can China escape a deflationary trap? Economic outlook 2024
Last year was the most widely anticipated recession in history because tight monetary policy, slower government spending and higher oil prices normally spell doom. Yet total economic output (GDP) in both America and Australia kept growing in real (after inflation) terms. So, what can we expect in 2024? Will economists get it right this year or miss the mark again? Here is the outlook for leading economies based on what most forecasters are saying. (more…)
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Rates cut outlook
The recent sharp falls in US, UK, European and Australian inflation rates have convinced analysts that central bank rate rises are over and the next move will be rate cuts in 2024. The US Federal Reserve chairman in the first half of December signalled that too. (more…)
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China is not a threat: debunking the US narrative
In this series, I explore how US narratives on the ‘China threat’ have become entrenched in Western security communities and how a ‘China threat’ narrative has been constructed by Republicans and Democrats in the United States in an attempt to create a “rally round the flag” effect designed to internally unite a deeply divided America. (more…)
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How to stop a Gaza apocalypse
Why Gaza urgently needs a plan B. (A repost from December 2023). (more…)
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Economic outlook – will 2024 be a hard, soft or no landing?
On the Australian economy, bulls and bears cannot both be right. 2024 will decide the fate of both economies and markets, a hard, soft or no landing.
