Good morning, and welcome to Wednesday. Here’s what you need to know:
- Australia will need to aim to find some $60 billion in budget savings by 2024 to achieve a surplus, according to a report in The Australian with details of the findings from the National Commission of Audit. Hockey has embarked on a mass expectation management exercise since Parliament rose and with numbers like this being bandied about, it’s easy to see why. This level of cuts would require the axing of entire current operations of government.
- The Australian Private Equity and Venture Capital Association submission to the Financial System Inquiry makes its case for enabling super funds to invest more in VC and PE, arguing that the funds have become too focused on short-term returns. This is a common refrain from lobbies that would love to get more access to the vast pile of money in Australian retirement savings, but the AVCAL submission does show how far Australia lags comparable markets in the deployment of PE and VC to grow businesses and support innovation. Worth a read.
- The S&P 500 hit an all-time high in the overnight session before pulling back a bit to close up 0.7% for the day. US car sales rebounded after the harsh winter helped the mood, and there was probably some price action driven by funds getting things moving at the start of the quarter.
- US burger chain Carl’s Jr, known for its raunchy TV commercials, is coming to Australia. But it won’t be opening in a major city: the first venue will be on the Central Coast (!) and it’s looking for franchisees in Sydney and Brisbane.
- The row over high-frequency trading sparked by Michael Lewis’s book Flash Boys is convulsing Wall St. Two CEOs from opposing sides of the argument got into a brawl on CNBC’s Power Lunch overnight, with the head of one exchange saying Lewis and people opposed to HFTs had possibly scared “millions of investors in an effort to promote a business model.” Traders on the floor of the NYSE behind them were cheering some of the comments.
- With the world’s PMI numbers out yesterday, BI’s Matt Boesler has put together this chart plotting the world’s economies by how hot they are running, based on activity reports from private sector purchasing managers. One way of looking at it is that France, Spain, and Ireland are among the strongest, finally showing signs of life after years in post-GFC doldrums. Another is that China is in the worst position on the chart overall – and if Australia was in there, it would be around where China is too. The graph is based on Markit data, while Australian PMI is reported by the Australian Industry Group, which is why it’s not in the chart.
- The RBA released its commodity price index for March yesterday and it suggests the Aussie dollar could be about 10% overvalued right now, at least when you compare it to how it has tracked historically with commodity prices. Greg McKenna takes a look here.
- Scientists say a mass extinction event on Earth 252 million years ago was caused by nothing more than microbes spewing methane into the atmosphere – an answer to the mystery of the planet’s biggest extinction event.
- Think about how you’ve been using your mobile phone over the last couple of years. Have you been moving away from using the browser to spending more time on apps? You’re not alone: people are freaking out about this chart showing time spent on the mobile web has fallen by more than 20% over the past year as folks spend more time in apps.
- Hapless Manchester United managed a 1-1 draw against favourites Bayern Munich in the first leg of their Champions League quarter final this morning. Bayern still haven’t lost since December. Report and highlights here.
Bonus item: Here’s a video of a guy wrecking his Lamborghini, a Mazda 5 and someone’s BMW in a complete absence of style in London’s Knightsbridge. The audio is glorious.
Have a great day. I’m on Twitter: @colgo
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