Good morning and welcome to your countdown to Christmas hols.
Let’s get it started:
1. Joe Hockey’s massive hole. The Treasurer is prepping his release of the Mid-Year Economic And Fiscal Outlook (MYEFO) for before Christmas and there’s going to be some ugly numbers. The crash in iron ore prices and slowing growth at home and in China means there’ll be a $5 billion deterioration in this year’s budget position to a deficit of $34.7 billion. And that’s beer money compared to the hole in the 2017-18 bottom line. Richardson’s expecting something approaching a further $12.4 billion deterioration.
2. It doesn’t get any better. Bank of America Merrill Lynch’s chief economist Saul Eslake poured cold water on his own forecast of 0.8% growth for this week’s Q3 Australian GDP. Don’t get too excited, he said in a note to investors, because a lot of that growth only benefits foreign investors in our mining industry.
Additionally, since the Australian resources sector is around 80% owned by foreigners, most of the income generated by rising resources exports accrues to non-residents.
As a result, he’s forecasting unemployment to hit 6.7% in 2015 and 6.8% in 2016.
3. Locally, the moves offshore have left the ASX SPI 200 futures for December off 44 points at 5294 bid and looking for a weak day’s trade. March was off 40 as well, but one thing which might counter what is a growing feeling of disquiet to all things Australian is the monster rally on iron ore Friday night with December 14 up $3.84 a tonne and Dec 2016 up $5.37. They are still way down on 12 months ago but that’s a solid rally.
4. On Asian Bourses the Nikkei climbed after the inflation data dipped again fueling expectations that the BoJ will be easing again but there is some recognition that a weak yen has it’s downside. Mish Shedlock had a note he picked up from Goldman Sachs saying that bankruptcy in Japan as a result of the weak Yen had risen.
5. A very expensive Facebook post. Five Aussie mates went to Vegas to play poker. At one stage, one mate lent a couple of grand to another mate. In the weeks that followed, a fight broke out on Facebook and evolved into the one mate being slandered from pillar to post by the other four on a thread that ran to 15 pages in length. Result? NSW Supreme Court judge Stephen Rothman awarded the one mate $340,000 plus costs, to be paid by the four. Publishing is publishing, and defamation is defamation, social media or otherwise.
6. Your week in data. Chrsitmas is in sight, but datawise, there’s a huge start to the month looming. We’ve got the RBA, Q3 GDP, PMIs all around the world, an ECB meeting and policy decision and then US non-farm payrolls to round out the week on Friday night. Bring it home with Westpac’s excellent weekly roundup.
7. The one winning Wallaby. Former Wallabies captain David Pocock was among seven people charged with illegally entering enclosed land, remaining without lawful excuse and hindering mining equipment. Pocock had chained himself to a digger to protest against Whitehaven Coal’s Maules Creek coal mine in NSW. The 26-year-old Wallabies flanker has been absent from the side since a knee reconstruction in March, but is winning plenty of fans for his stances on a range of issues.
Locked on to a superdigger with Rick Laird, a fifth generation farmer in the Maules Creek area. Protesting Whitehaven's new coal mine in Leard State Forest. The mine will be devastating for the forest, water table and local farming community. I don't see how we can deal with climate change while opening new coal mines… #leaveitintheground #communityfirst #savetheleard
8. “The World’s Most Liveable…” something or other pops up nearly every other week one one website or another, but the University of Melbourne says it’s developing Australia’s first set of national health liveability indicators. They’ll examine five domains of liveability from which we’ll all be able to work out which environments work best for our health – and which don’t. Top of the list is Alcohol and how accessible it is in your neighbourhood. The other four are Food, Public open space, Transport and Walkability.
9. Self-help time. Internet getting a bit dull? It’s not all cats and friends of your friends’ babies – here’s 25 websites that will actually make you smarter. Learn to code, take proper photos, or even expand your vocabulary while feeding the hungry. It’s better than telly, even.
10. So, remember that new golden era for the Wallabies, which lay ahead when Ewen McKenzie handed in his notice and no nonsense Michael Cheika took over? It’s starting to look like the team would be just as effective chained to mining equipment with Pocock. In their worst European tour in a decade, they went down 26-17 to England, so on the 30th anniversary of the Grand Slam Wallabies, they’ll come home with one win and four losses, leaving fans wondering what sightseeing that should read up on for after the group round of next year’s World Cup. You can see the team’s talent, but they seem to have a knack for losing. Cheika says the team doesn’t believe in itself enough, but is heading in the right direction. Let’s hope they get there quickly.
BONUS ITEM: ThyssenKrupp would like us to call it their “world’s first rope-free elevator system”. But we really know it’s Charlie’s Great Glass Elevator:
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