Thursday, October 31, 2019
The Macro View – Health, Economics, and Politics and the Big Picture. What I Am Watching Here And Abroad.
October 31, 2019 Edition.
In the US we are seeing the Impeachment Enquiry cause Trump increasing difficulty while the US place in the world deteriorates more and more leading to all sorts of breakouts all over as the US is distracted. Trumps polling numbers are slowly going south and he must realise he is in more than a little trouble. The killing of the ISIS leader was the big Trumpian news for the week. Who knows what that will do for his election chances.
Brexit in the UK seems to be heading to an election – which will be Dec 12 in news breaking during the week.
In Australia the drought continues to be political and real problem for the ages given how long it has lasted and the worry it might go on for a great deal longer to very dangerous damage to rural communities. The drought may turn out to be an existential threat to much of the Australian way of life in terms of food production, exports and many other aspects of things at present.
Oct 21, 2019 — 12.00am
Washington | Treasurer Josh Frydenberg has left Washington upbeat about challenges facing the global and domestic economies, including a "more positive" outlook for a US-China trade fix, even as the IMF warned Australia must tackle tax reform and that next year's budget may need to tap some of the surplus to stimulate growth.
Mr Frydenberg said his message was "there's no need to panic" and that the global economy "remains sound", after three days of intense talks with counterparts from around the world, including US Treasury Secretary Steven Mnuchin, UK Chancellor of the Exchequer Sajid Javid and India's Nirmala Sitharaman.
"Despite the challenges facing the global economy I found that people were more optimistic than not about the ability of the economy to get back on track," he told The Australian Financial Review before boarding his flight back home.
Aleks Vickovich Reporter
Oct 21, 2019 — 12.00am
Magellan Financial Group has played down suggestions that the corporate regulator’s pause on the $3.7 billion market for actively managed exchange-traded funds stems from conflict of interest concerns.
The Australian Securities and Investments Commission’s (ASIC) decision in July to order exchange market operators to temporarily suspend admission of active ETFs sparked speculation in the financial services industry that the regulator is concerned about a lack of transparency and potential for conflicts in this burgeoning segment of the market.
But Brett Cairns, the chief executive of active ETF pioneer and $86 billion fund manager Magellan, told the ETFs Down Under conference last week he welcomes the pause and that the reason behind it is “misunderstood”.
“[Concern around conflicts] is not what is driving this,” Mr Cairns said. “When you move from the unlisted space in terms of all the processes … and you then move it to the listed space there are various other requirements you need to meet. What ASIC is rightly saying is let’s pause here.”
Oct 21, 2019 — 12.00am
Those of us of an older vintage will remember when the Bank of Japan (BoJ) introduced the zero interest rate policy in 1999.
Back then, it was seen as revolutionary, but also as a temporary move to help restore the fortunes of the Japanese economy. Japan had experienced a stunning return from the wilderness at the end of the war in 1945 to become a global powerhouse only 40 years later.
At the time, the bust of the 1990s was seen as cyclical rather than a structural demographic one, and the BoJ even tried a rate hike in late 2000 as the economy ticked up. However, shortly after, rates were back at zero from where - like a Black Hole - they have never emerged.
For the first time, lower rates had an unusual and unexpected impact: rather than trigger a surge in borrowing, Japanese savers tightened their belts and increased savings. No one wanted to pay for these surplus savings.
Go to any auction in the eastern suburbs of Sydney - as I and my son did on Saturday - and the result is obvious.
Oct 20, 2019 — 6.46pm
Here we go again. Treasurer Josh Frydenberg and RBA governor Philip Lowe are going to have to stop referring to Sydney and Melbourne house prices “stabilising” unless they want to be accused of distorting the English language.
The description may have a conveniently reassuring tone. But it’s been overtaken by the dramatic change in sentiment, accelerating over the past several weeks, as enthusiastic buyers rush back into a spring market.
Real estate agents are quietly expressing surprised delight at a momentum even their most aggressive sales pitches weren’t predicting just a month ago. Any number of bank analysts are now revising their predictions for next year.
Karen Maley Columnist
Oct 21, 2019 — 12.00am
Billionaire hedge fund founder Ray Dalio probably didn't have either WeWork or Latitude Financial in mind, but his warning that the global economy is heading for a "big sag" pithily sums up the market's risk-taking appetite at present.
Speaking as part of a panel discussion in Washington last week, the founder of the world's largest hedge fund, Bridgewater Associates, said the business cycle was fading and that the global economy was headed into what he called a "great sag".
"This is the best that we get – this moment. We are at the best. The cycle is not going to continue forever, the expansion. You have this sag," he said.
Piling on the stimulus dollars is not justified when the IMF and the Reserve Bank can see through this downturn.
The AFR View Editorial
Oct 21, 2019 — 12.00am
There is no need to panic by crazily cutting interest rates to zero or recklessly blowing the budget surplus. That would make things worse. While subpar, Australia’s 1.4 per cent economic growth rate is far from crisis territory. After some jarring headlines on economic growth last week, Reserve Bank governor Philip Lowe said in Washington on Friday that Australia’s economy could return to trend growth of near 3 per cent next year. Adding up rebounds in commodities and housing, and the effects of lower interest rates and tax cuts, Dr Lowe said he “wouldn’t assume” more rate cuts, moving the Reserve Bank bias towards neutral. The market odds of a Melbourne Cup day rate cut have fallen from one in two a week ago to less than one in five now. That’s a reassuring retreat on recent talk that Australia has been just months away from effectively zero interest rates and quantitative easing money-printing to escape from economic stagnation.
October 20, 2019 — 11.45pm
Australians are being urged to heed new warnings about the cost of government secrecy in a united campaign by the nation's biggest media companies that calls on Parliament to enshrine press freedom and protect whistleblowers.
The "Your Right to Know" campaign intensifies the case for significant law reform to stop the suppression of information that is vital to consumers, citing real-world examples such as the suppression of information about abuse of the elderly in aged care homes.
Seeking change after police raids on journalists and whistleblowers this year, the media industry is widening the argument over the "right to know" by focusing on the harm to Australians if abuse and corruption are never exposed.
With a media blitz running for weeks, the campaign is unusual in its scale as well as its broad support across the industry from Nine, the ABC, The Guardian, News Corp Australia, Prime Media, Seven West Media, Sky News, SBS, Ten, the WIN Network and others. (Nine owns this masthead.)
October 21, 2019 — 11.40am
The Australian Federal Police has commissioned a review into how it investigates leaks and other sensitive cases following an outcry from media companies over raids on News Corp and the ABC earlier this year.
AFP commissioner Reece Kershaw, who was appointed in July after predecessor Andrew Colvin retired, acknowledged a need to "improve the processes" in those investigations.
On the day newspapers published blacked out front pages, new AFP Commissioner Reece Kershaw has fronted Senate estimates, questioned over media raids and press freedom.
Decades of needless secrecy have enshrined a culture of absurdity the permeates every level and every crevice of the public service.
Phillip Coorey Political Editor
Oct 21, 2019 — 10.43am
If there's one group of people Joe Public regards lower than politicians, it's the media.
Scott Morrison knows it and that's why, when advocating the importance of press freedom, the Prime Minister always adds the caveat that he also believes in the rule of law.
"No one is above it, including me or anyone else, any journalist or anyone else," he said on Sunday in anticipation of Monday's press freedom campaign by the Right to Know Coalition.
"And the rule of law has to be applied evenly and fairly in the protection of our broader freedoms. And so I don’t think anyone is, I hope, looking for a leave pass on any of those things, I wouldn’t and nor should anyone else."
October 20, 2019
All of Australia’s major media organisations have joined forces to call for reforms to protect public interest journalism in Australia. Australia’s Right to Know coalition includes Nine, News Corp, the ABC, SBS, The Guardian, and journalists’ union the Media, Entertainment and Arts Alliance.
The campaign, an unprecedented show of unity between competitors, is pushing for stronger protections for media freedom after years of perceived deterioration. The outlets are seeking to combat a growing culture of secrecy that restricts journalists’ ability to hold the powerful to account.
Someone paid $140m for an off-the-plan apartment in Sydney over the weekend. Nice views, and a master bedroom the size of a normal house, but still…
Normally you’d be reaching for the bell to ring out the market top after something like that, but not this time. The top of the market was 2017. This is more like the start of another boom.
Here’s the problem with modern monetary policy: record low interest rates make businesses and consumers anxious, and less inclined to spend and invest, but it has the opposite effect on property buyers. It makes them less anxious, and more inclined to buy.
A group wants the federal government to accelerate the implementation of legislation that would allow the Council of Financial Regulators to enforce “appropriate parameters around the ASX’s use of its monopoly powers”.
Oct 22, 2019 — 12.00am
As the ASX moves towards the pointy end of replacing Australia’s equity clearing and settlement system, it is suddenly dawning on a range of market participants that their businesses could disappear.
There are fears among equity issuers, company secretaries, stockbrokers and providers of share registry services that replacement for the 25-year-old system called CHESS will allow ASX to extend its clearing and settlement monopoly into other areas.
It is feasible the ASX’s blockchain-based distributed ledger technology could be used to replace the work done by share registries, which enjoy about $500 million a year in revenue from being the middlemen in managing share ownership.
A democracy cannot be healthy when journalists and whistleblowers clearly feel as intimidated as they do now.
Max Mason Media & Marketing Editor
Oct 22, 2019 — 12.00am
When Nick McKenzie turned up for work at The Age's old offices on the corner of Collins and Spencer streets in Melbourne's CBD in late 2013, there was a bunch of flowers waiting on the investigative reporter's desk.
"There was a card, I opened the card, it said: 'Dear Nick, there are three sets are eyes of watching you'," McKenzie says. "I panicked initially."
The multi-award-winning journalist was on the trail of high-level corruption within a government agency. As it turns out, the flowers were a warning - three government agencies, or three sets of eyes, were physically surveilling him.
The latest US yield shift is yet another reminder of how traditional market signs have been distorted by years of unconventional central bank policies.
Mohamed A. El-Erian
Oct 22, 2019 — 5.20am
As we count down to this month's meetings of the European Central Bank and the Federal Reserve, both of which are expected to maintain their monetary easing stance, the US yield curve has been quietly undoing the inversion that had raised alarms in the corridors of the world's two most systemically important central banks.
Just as I had argued that the inversion was not a reliable signal of a coming US recession, we should not rush to see this return to more normal conditions as a comforting green light for what's ahead for the economy. Instead, it is yet another reminder of how traditional market signs have been distorted by years of unconventional central bank policies.
Over the last few weeks, the US yield curve has been slowly and gradually regaining its more traditional upwardly sloping shape whereby longer maturity bonds trade at a higher level than their shorter-maturity peers.
Robert Guy Senior Writer
Oct 21, 2019 — 5.30pm
Leading economists are still forecasting at least one more rate cut and the likely adoption of quantitative easing, despite the Reserve Bank playing down the need for lowering the cash rate and Treasurer Josh Frydenberg saying there was "no need to panic" about global growth.
Westpac chief economist Bill Evans stoked the debate about the adoption of quantitative easing (QE) on Monday, saying the cash rate's approach towards its "effective lower bound" meant the central bank was "likely to be prepared to adopt some form of asset purchase program, if needed over the course of 2020".
Calls for additional monetary and fiscal stimulus have grown after the anticipated boost to growth from the government's tax cuts proved disappointing, consumer sentiment remains weak due to muted wage growth, inflation remains below the RBA's target band, and the banks' unwillingness to fully pass on recent interest rate cuts has blunted the effect of easier monetary policy.
There has been a torrent of security laws to deal with real threats. Now they need an overhaul that explains to Australians what these powers are for.
John Blaxland Contributor
Oct 21, 2019 — 10.26pm
How do we balance the rights and obligations of individuals, businesses and government in media matters? Three-step corrective action is called for: to review, consolidate and clarify national security legislation; to bolster safeguards against abuse of media freedoms; and to strengthen provisions for appeal against government overreach.
Australians hold dear the right to freedom of speech and the right of the media to report freely and frankly, exposing lies, corruption, and malfeasance. This freedom is a fundamental part of the fabric of our society, but it is becoming a serious point of contest. When media freedom is eroded, then confidence in governance is eroded as well. Corrective action is now required – and urgently.
Unprotected, democracy can degenerate into mob rule, civil war and anarchy at one end of the spectrum, as seen in places like Syria; or into repressive elite rule, as in Vladimir's Putin’s Russia, at the other end. To avoid these illiberal alternatives taking root in an open society like Australia, we must guard closely the rights of freedom of expression that appear to be under challenge. A society that values openness, accountability and checks and balances is one that strives to defend itself against tendencies towards the abuse of power. Indeed, many of the freedoms we take for granted are made possible by a free media. This is inherent in belonging to a civil society in which the media, along with a robust university sector research and advocacy, has traditionally played an important role as a watchdog against corruption and abuse of power.
Australia has been described rightly as the world’s most secretive democracy. Other nations have reacted with surprise and alarm at our raids on media offices, and that our parliament has passed so many laws that stifle freedom of speech and of the press. We have developed a reputation for enacting security laws more suited to an authoritarian state than a liberal democracy.
Many nations have enacted stringent national security laws since the September 11, 2001, terrorist attacks in the US. These respond to the threat of terrorism and include exceptional measures such as the USA PATRIOT Act and the introduction of control orders in the United Kingdom. Australia, nonetheless, stands out from the crowd. We have gone further than any other liberal democracy in the number of security laws enacted (82 at last count), and in their impact on democratic values. Too often, these laws demonstrate a willingness to shut down debate and to shield government from damaging, embarrassing information.
The federal government has recognised this belatedly. Home Affairs Minister Peter Dutton has issued a ministerial direction to the Australian Federal Police that they consider press freedom before investigating journalists who publish secret material.
Attorney-General Christian Porter also has instructed federal prosecutors that they must obtain his consent before charging journalists under certain national security laws.
Oct 22, 2019 — 5.00pm
While the political focus on climate change is fixed on the Morrison government, much of the big business community is just trying to get on with business. These days that has to include getting on with corporate emissions reduction policies.
The most intense pressure to do so comes from major institutional investors, global and domestic. Investors increasingly see climate change as a key business risk and want company boards to prove they are incorporating that into their strategies.
This usually comes under the general heading of ESG investing – the now ultra-fashionable acronym standing for environmental, social and governance. Evidence of adapting a business model to address climate change concerns has become the sharpest edge of that scrutiny.
This goes well beyond pressure on boards from big industry superannuation funds, for example – or gesture politics like Commonwealth Bank saying it will exit its already extremely minor thermal coal lending by 2030 and add climate risk to its assessment tools for business lending.
October 23, 2019 — 12.01am
Corruption inquiries have hit a record high at the nation's law enforcement agencies in a telling sign of misconduct at the same time federal politicians face a united media campaign against government secrecy.
The federal integrity commissioner has disclosed the "highest ever" number of ongoing corruption issues being investigated, with the workload growing by 20 per cent to have 278 investigations under way at the end of June.
The peak agency has also named online gambling as a factor in the corruption of law enforcement officers, saying it makes it more difficult to detect problems compared to public gambling.
The findings come as Prime Minister Scott Morrison counters media industry calls for six reforms to protect media freedom including stronger laws to protect whistleblowers who reveal public sector misconduct.
Senior business columnist
Updated October 22, 2019 — 1.23pmfirst published at 1.04pm
If the markets are a reliable guide, all’s right with the world.
The US stockmarket is up 20 per cent since the start of the year. Oil prices are about 10 per cent higher. The copper price, traditionally a good barometer of global economic health, is marginally higher although 11 per cent off the year’s peak.
The one discordant note is provided by a gold price that is 16 per cent higher than at the start of the year. The gold price is traditionally closely correlated with perceptions of risk.
Most significantly, at face value, a US yield curve that has been inverted for most of the year has now reverted, with short-term yields lower than those on bonds with longer terms to maturity.
When yields on 10-year bonds have been lower than those on short-term securities it has historically signalled a looming recession. Now the US yield curve, while quite flat, has yields rising with duration.
Nine News Political Editor
October 22, 2019 — 4.00pm
Kevin Rudd’s plane had taken an unusual detour on the return journey from the 2008 APEC meeting in Chile, going via Hawaii rather than Auckland.
Detours on domestic and international journeys were not that uncommon for the peripatetic Kevin747, so few in the travelling media pack thought much of it.
Australian media organisations have come together to blank out their front pages in a united stand against government secrecy.
We grumbled because it meant taking the long way home and the mild inconvenience of checks by US Custom and Border Security but, as we were on the Australian PM’s jet, even that was bound to be a breeze.
A stunning report from global management consultants McKinsey on the dangers that ultra-low interest rates pose to global banking shows how the next global financial crisis could be much more dangerous than the last.
And while our banking system is not on the frontline of the dangerous battleground, we are headed in that direction. To avoid a potential crisis, banks — including Australian banks - must reinvent themselves
The McKinsey report explains that the ultra-low global interest rate environment is damaging vast areas of the global banking system.
Freedom of Information reviews are taking more than a year, some without even being allocated to a case officer, because the federal government has not given the oversight agency enough funding.
The incoming Coalition government tried to abolish the Office of the Australian Information Commissioner but was unsuccessful. It has since allowed its three separate commissioner functions to be done by one person, most recently Angelene Falk.
In a Senate estimates committee hearing on Tuesday, Ms Falk said there had been an 80 per cent increase in applications for review of FOI decisions over the past four years.
Superannuation funds are missing out on billions of dollars a year in returns by ignoring the tax consequences of their investment decisions, according to experts — leading to larger system-wide losses even than excessive fees.
New analysis has concluded retail and industry funds, with a combined $1.9 trillion in assets, could increase their annual returns by $7.54bn, or almost 0.6 per cent a year, if they maximised refundable franking credits and available capital gains tax discounts, and avoided redundant trades.
“Very few if any super funds in the country measure tax appropriately,” said Kyle Ringrose, principal at Athena IOC, an investment consulting firm.
October 24, 2019 — 12.05am
Australia will meet its Paris commitments to cut greenhouse gas emissions if the nation continues its love affair with solar and wind power, an independent study has found but argues it could be put at risk without extra investment in transmission and storage.
The Australian National University research found Australians were taking-up solar and wind energy at such a fast rate the country would not have to use contentious "carryover" accounting credits from the Kyoto climate accord.
The Morrison government has come under fire from Labor, the Greens and environmental groups over how Australia will meet its Paris commitments to cut greenhouse emissions by 26 and 28 per cent on 2005 levels by 2030.
October 24, 2019 — 12.01am
The Morrison government has been accused of breaching disclosure laws by scaling back the peak agency which oversees the release of information amid a growing row over public sector secrecy.
Former Commonwealth ombudsman John McMillan said the government's approach to Freedom of Information was undermining transparency and breaching the spirit of federal law.
The warning intensifies the debate over a backlog of requests for information by citizens and the media, with the Department of Home Affairs failing to release documents within the legal deadline in one out of four cases.
October 24, 2019 — 12.00am
In 1989, Paul Keating was boasting of his success in garnering public support for his difficult reforms when he pronounced: “I'll guarantee if you walk into any pet shop in Australia, the resident galah will be talking about micro-economic policy.”
Thirty years later, the galahs are all squawking about “infrastructure”, with multiple pleas for Canberra to let loose the purse string to spend billions of taxpayer dollars on job-creating projects to save the economy.
It’s true that borrowing costs are low and that the right infrastructure projects have the potential to boost the future productive capacity of the economy. It’s also true that investing in infrastructure would create jobs and perhaps some modest upward pressure on wages.
But, unfortunately, it’s also true that governments have a tendency to pick projects based on proximity to marginal electorates, rather than a rigorous cost-benefit analysis.
It’s seen as something to celebrate by millions of Aussies — but there’s a very good reason these three words leave finance experts terrified.
news.com.au October 24, 201910:48am
The Reserve Bank slashed the official interest rate to an all-time low of 0.75 per cent earlier this month, with most experts agreeing that figure would soon fall further.
And Australia is not alone, with plummeting interest rates now a trend across the globe.
It’s become such a hot topic the phenomenon of “negative interest rates” — when the cash rate falls below zero — has been making headlines for months now.
In August, Denmark’s Jyske Bank launched the world’s first negative interest rate mortgage, effectively paying borrowers 0.5 per cent a year to take out a loan.
Australia is the most secretive and least accountable advanced Western democracy in the world. I come to this conclusion reluctantly after more than 40 years in journalism, including a lot of experience in the US, Asia and Europe.
Nothing makes me prouder to be a journalist than the media industry’s Right to Know campaign. We are not fighting for our jobs or economic models — we are all fiercely, almost insanely, competitive and our economic models are all different. We are fighting for the truth, which in the West is achieved by maximum disclosure of information and the free competition of ideas and interpretations.
Australia has drifted into a deeply anti-democratic, anti-disclosure mode. Both sides of politics, and some quirks in our history, are responsible. Whether in government or opposition, both parties are equally to blame. In government, parties are obsessed not with national security but with avoiding embarrassment, and take punitive, onerous measures. In opposition, parties are concerned to maximise embarrassment so constantly call for the criminalisation of any leak not given to them in the hope that this will ensnare someone from the government or cause general mayhem.
Mums and dads are piling into junk bonds without understanding they're assuming substantial risk that could inflict 40 per cent losses on their portfolios in a crisis.
Christopher Joye Columnist
Oct 25, 2019 — 9.14am
“It is hard to survive on zero per cent if you’re a retiree,” says one curmudgeonly adviser while explaining why his clients are shifting out of term deposits (TDs) into a listed “high-yield”, or junk, bond fund that can leverage these equity-like assets up to two times to enhance returns.
Make no mistake, our predicted search for yield thematic has landed with a thump on Australian doorsteps. We are seeing it everywhere as cash is redeployed into assets with higher probabilities of loss and sketchy liquidity. In fact, having no liquidity, or no real ability to trade the underlying assets, is an advantage if it means that the investment reports no volatility. While many of these assets have similar risk to equities, that downside is hidden during the good times because of the lack of liquidity until a shock emerges and the portfolio is forced to take a write-down.
To be clear, there is nothing inherently wrong with looking for more yield (“beta”), and this is arguably what the Reserve Bank of Australia (RBA) wants to encourage with its cash rate cuts. Many of the products that are exploiting the search for yield are excellent. You just have to understand what you are getting into. I have, for example, repeatedly seen money shift out of TDs into an “investment account” (actually a mortgage trust) that holds "below-prime" home loans that have paid over 5 per cent after fees over the last year.
John Kehoe Senior Writer
Oct 25, 2019 — 12.00am
More than half of company directors expect the economy to deteriorate next year, prompting board members to call for the Morrison government to bring forward tax cuts and infrastructure spending to boost economic activity.
Directors said global economic uncertainty, China's uncertain economic outlook and low productivity growth were the top three economic challenges facing local business, according to a new survey of 1489 members of the Australian Institute of Company Directors.
Some 59 per cent of directors expect "weak" economic conditions in Australia over the next 12 months.
The director sentiment index has fallen to its lowest level since late 2016 and only 8 per cent of board members think business conditions will be strong in 2020.
The trashing of norms and rules without accountability might be the mark of Trump and Brexit, but it is playing out here as well.
Laura Tingle Columnist
Oct 25, 2019 — 3.39pm
A question for students of bad bits of history has always been: how did people let such a thing happen? How was it that things were able to deteriorate in the way they did without the public expressing their alarm or objection?
It feels like we are getting a very real answer to that question in the way the world is moving at present.
It’s about the power of relentlessness and the creeping tide of incremental shocks.
World events may often be seen now through the prism of Donald Trump’s unique grasp on the concept of government, or the perplexing, apparent immolation of any sense of self-interest in the British public as the Brexit train wreck continues.
Oct 25, 2019 — 3.03pm
Washington | US Ambassador Joe Hockey has unleashed a blistering attack on Donald Trump’s isolationist attempts to dismantle more than 60 years of global economic order, warning that “if you abdicate leadership you rarely get it back”.
In a stunningly blunt speech for Australia’s top diplomat to the US, Mr Hockey urged America not to “allow itself to walk away from its trade leadership role” saying that to do so would see it “inevitably pay a very significant economic price.”
In a direct personal barb at Mr Trump, Mr Hockey said he had “heard suggestions - and perhaps you have heard them too - that to 'win' in trade with another country, you need to sell more to them than you buy from them - that is, that you should have a trade surplus”.
By Laura Tingle
26 October, 2019
A question for students of bad bits of history has always been: how did people let such a thing happen? How was it that things were able to deteriorate in the way they did without the public expressing their alarm or objection?
It feels like we are getting a very real answer to that question in the way the world is moving at present.
It's about the power of relentlessness and the creeping tide of incremental shocks.
World events may often be seen now through the prism of Donald Trump's unique grasp on the concept of government, or the perplexing, apparent immolation of any sense of self-interest in the British public as the Brexit train wreck continues.
Donald Trump's latest outrage — on a day-to-day basis — is dismissed as "Trump being Trump".
October 25, 2019 — 3.45pm
Australian households have run down their savings by $46.4 billion over the past four years and crimped their spending on daily needs to offset higher income taxes and sluggish wages growth.
Final Australian Bureau of Statistics (ABS) figures for 2018-19 also reveal labour productivity has turned negative for the first time while the nation's dependence on mining exports has reached a record high.
The economy grew 1.9 per cent through the just-completed financial year, its slowest performance since the depths of the global financial crisis but maintaining its 28-year run of continued expansion.
Political and international editor for The Sydney Morning Herald
October 26, 2019 — 12.00am
After winning power on a minimalist platform, Scott Morrison is so far governing on a minimalist program. He seems so intent on the idea that his government is having trouble responding to Australia's changing realities.
The recurring theme of the Morrison government is the inadequacy of its responses to the big problems. Most prominent in the Parliament have been the inadequacies on drought policy and economic reform. Is he Australia's Prime Minimal?
There was much talk after his unexpected election victory of the tremendous "authority" he would wield in his ruling Coalition. If so, he's certainly not making use of it to develop policy ambitiously.
When called on to do more, on the drought or the economy, the government has developed a standard response – everyone else is "panicking".
October 26, 2019 — 12.00am
There’s a lesson for Scott Morrison in new Treasury secretary Steven Kennedy’s first public speech this week: put the right person at the top of Treasury and they’ll defend the government’s position far more eloquently and persuasively than any politician could. The econocrat’s greater credibility demands they be taken seriously.
I fear that time will show it's been a costly mistake by the government not to respond to Reserve Bank governor Philip Lowe’s unceasing requests for budgetary stimulus to supplement the diminishing effectiveness of interest rate cuts. Costly in terms of lost jobs – perhaps even including the Prime Minister’s.
But that Dr Kennedy’s opening statement at Treasury’s appearance before Senate Estimates is a robust defence of official policy should surprise no one (except politicians, who are prone to paranoia). In my experience, senior Treasury officers never gainsay the government of the day, in public or private. If it’s an independent view you’re after, try the Reserve.
October 26, 2019 — 12.05am
There are numerous explanations for why recent attempts to raise billions of dollars through initial public offerings in Australia have failed, but on one point they all agree: The recent crop of companies looking to float have been mostly poor quality businesses.
The list of IPO candidates that don’t make the cut grows daily. Consumer credit company Latitude was the biggest and most spectacular misfire, but its failure to launch has been followed by a rapid-fire string of aborted floats including Retail Zoo (the owner of Boost Juice), mining services outfit MPC Kinetic and digital real estate classified hopeful PropertyGuru. What most of them have in common is that the sellers are private equity firms.
Their IPO misadventures on the ASX are a clear sign that fund managers are being increasingly selective about which floats they will support. The price must be right.'
Australia’s labour productivity has fallen over the year for the first time on record, underscoring the urgency of reform to ignite economic growth.
The Australian Bureau of Statistics on Friday said labour productivity — the amount of goods or services produced by workers in a given hour — fell by 0.2 per cent in the previous financial year.
It was the first annual fall for the market sector aggregate of labour productivity since the data series started, and the government statistical agency said the decline was broad-based, sliding across more than half of all industries.
Josh Frydenberg highlighted a raft of potential reform areas at a meeting of state and federal treasurers earlier this month, including overhauling transport and logistics taxes, health funding, skills investments and streamlining environmental regulation.
Scott Morrison, fresh from meeting Chinese Vice-President Wang Qishan, said he would not be trapped into a “binary assessment” of Australia’s relations with China and the US. “Australia as an independent, sovereign nation has a unique perspective,” the Prime Minister said.
Frances Adamson, the head of the Department of Foreign Affairs and Trade, gave a sobering assessment, and quietly ominous warning, at Senate estimates, when she remarked: “It (relations with China) will be a relationship where we will need on both sides to work quite hard to manage what I really think will be enduring differences.
“Some points of difference may come and go but other points of difference, which go more deeply to differences between our systems and our values, are likely to endure.”
Though she didn’t like the term, these difficulties would be “the new normal” in Australia China relations, she said.
Federal cabinet has discussed Treasury advice about the Reserve Bank launching an unprecedented program of quantitative easing as the government’s key economic department privately warns Australia is “closer than we have been previously” to requiring unconventional monetary policy.
Senior Treasury economists warned the Morrison government in July there was a “material prospect” the RBA could soon reach the “effective lower bound” where further reductions in the cash rate have little or no effect in stimulating the economy, which recently logged its worst annual growth since the global financial crisis.
According to a cache of documents submitted to Josh Frydenberg’s office by the Department of Treasury — obtained by The Weekend Australian under Freedom of Information laws — economic bureaucrats advised that the RBA’s likely course of action, should it need to launch unconventional monetary policy, would be a quantitative easing program of buying residential mortgage-backed bonds.
This would lower bank funding costs and allow borrowers to access cheaper credit.
October 27, 2019 — 12.00am
Attorney-General Christian Porter has defended the Morrison government's response to the national media's "Right to Know" campaign, saying the government was balancing the rights of a free press against other rights including fair trials and non-vilification.
Mr Porter, the country's chief law officer, has also signalled his government will resist some of the media's key demands while maintaining claims from security agencies that Australian journalists could be "exploited" by foreign interests.
National media last week launched a fresh campaign – which included major newspapers publishing "redacted" front pages – calling for a string of changes in the face of growing complaints about government secrecy.
AMP and IOOF are taking their first, tentative steps towards filling the wealth advice gap they say is emerging as the sector hollows out. But ASIC will need to be convinced.
Oct 21, 2019 — 12.00am
Australia’s wealth management sector is starting to take its first, very tentative steps into the future with a simple: What do we want advice to look like in five years' time?
Not surprisingly, the two men hoping to start that discussion have the most to gain – and lose.
AMP chief executive Francesco De Ferrari and IOOF boss Renato Mota run Australia’s last listed wealth giants, as the big banks abandon the sector, with varying degrees of success.
Of course, this is not just a question that the industry needs to answer. Policymakers and regulators still justifiably fixated on the industry’s past sins, will eventually need to shift their gaze to what its future shape might look like.
Aleks Vickovich Reporter
Oct 24, 2019 — 12.00am
Commonwealth Bank's wealth arm has warned financial advisers it will be writing to clients and asking them to re-confirm fee payments, in line with a Hayne royal commission recommendation.
George Walker, acting general manager of distribution at Colonial First State, has caused some alarm among the bank's financial adviser customer base with a major change to its process of deducting advice fees from superannuation accounts.
"So we ensure we meet regulator expectations, we’re strengthening our process and from early December, we’ll be asking members who have paid ongoing adviser service fees for the last 12 months or longer, to confirm their agreement to continue deducting these fees from their Colonial First State super and/or pension account," Mr Walker wrote in a communication to advisers seen by The Australian Financial Review.
October 26, 2019 — 12.00am
Aged care quality and safety commissioner Janet Anderson says elderly Australians are still being sexually abused in aged care facilities, more than a year after the royal commission was established.
"We continue to receive reports through the compulsory reporting process which suggests that there remains an incidence of assaults in services which still needs to be attended to," Ms Anderson told a Senate estimates hearing in response to a question about sexual abuse.
Reports of sexual abuse of aged care residents are ongoing, the independent commissioner says.
The Royal Commission into Aged Care Quality and Safety is preparing to hand its interim report to the federal government next week.
October 21, 2019 — 5.00am
Scott Morrison’s problem is that he gets politics – and is good at it – but doesn’t get economics.
The Prime Minister doesn’t get that if he keeps playing politics while doing nothing to stop the economy sliding into recession, nothing will save him from the voters’ wrath.
Neither he nor Josh Frydenberg seem to get that if we endure another year of very weak growth before they pop up next September boasting about their fabulous budget surplus, no one will be cheering.
How could a second financial year of weak growth possibly leave the budget with a big surplus? Because of the miracle of continuing bracket creep and iron ore prices kept high by BHP’s dam disaster in Brazil.
Small government that did not crowd out the private sector once made sense. Now it's just sapping growth.
Stephen Grenville Contributor
Oct 21, 2019 — 1.07pm
Three decades ago, an unlikely coalition changed fiscal norms: how we think about budget deficits. Ivory-tower academics, self-interested businesspeople, faceless bureaucrats, cautious households and libertarian politicians, all came to agree on one thing: active fiscal policy should not be used to counter the business cycle. What started as a necessary correction of an overuse of budget deficits became a doctrinal balanced-budget fetish. Now it’s time to restore common sense.
The story begins in the 1960s. The combination of the Vietnam War, LBJ’s Great Society and the moon landing put such pressure on US capacity that inflation was inevitable. Once the inflation-expectations genie was out of the bottle, the 1970s stagflation followed, as tight policy attempted to counter inflation’s persistence. Both fiscal and monetary policy, working together, eventually did the job, but at great cost to output and employment: the Volcker deflation in the USA and the ‘recession we had to have’ in Australia.
Matthew Cranston Economics correspondent
Oct 22, 2019 — 11.38am
The manager of fixed income at Australia's largest superannuation fund, Australian Super's Katie Dean, says expectations about inflation are becoming a major concern for central bankers and could result in consumers holding off spending.
"If you're a central banker at the moment, the one thing that you need to work on and need to absolutely prevent is a de-anchoring of inflation expectations," Ms Dean told the Economics Society of Australia in Canberra on Tuesday.
"That is the one thing that any central banker – but [also] any policymaker in the government – should be very worried about ."
Ms Dean explained the concept with the example of a consumer delaying buying a pair of shoes that cost $100 today, because they expect inflation to be lower and the shoes to cost $80 next week.
New Treasury secretary Steven Kennedy says he is “cautiously optimistic” about the Australian economy strengthening and is calling for patience in evaluating any positive impact from the government’s flagship tax cut package on consumer spending.
Appearing before a Senate Estimates committee on Wednesday, Dr Kennedy said the effect of the government’s low-and-middle-income tax refund program would “become clear towards the end of this year”.
According to the most recent official figures, retail spending rose by a weaker than expected 0.4 per cent in seasonally adjusted terms in August after the Australian Taxation Office had delivered tax refunds worth $14.5 billion to 5.4 million workers. This followed weak figures of between minus 0.1 per cent and 0.3 per cent in the three months prior.
The Australian economy recently logged its worst annual growth since the global financial crisis, and the IMF’s World Economic Outlook last week cut its growth forecast for the Australian economy from 2.1 per cent to 1.7 per cent — a level below the government’s and the Reserve Bank’s forecasts of about 2.25 per cent.
Carrie LaFrenz Senior Reporter
Oct 21, 2019 — 12.00am
One of Australia's largest institutional fund managers is making healthcare a single core theme across its asset classes of private equity, infrastructure and real estate as it expands further into the sector.
Queensland Investment Corp - which has more than $85 billion of funds under management - will make more direct investments in healthcare companies and will partner with US firms such as Frazier Healthcare Partners and Webster Equity Partners, which are focused on the sector.
Superannuation money around the world is trying to find a home in asset classes that will provide long term stable returns, with cashflow attached.
QIC boss Damien Frawley believes healthcare naturally fits underlying capital systems like superannuation.
October 23, 2019 — 12.01am
Australians with private health insurance will face hefty premium increases next year - likely to be twice the rate of inflation - after Health Minister Greg Hunt's deal with the medical devices industry failed to lower costs as promised, the peak body for insurers has warned.
Private Healthcare Australia chairman John Hill said Health Minister Greg Hunt's goal of limiting the next round of premium increases to an average three per cent would be "extremely challenging" to meet, after the cost of devices like knee and hip replacements soared by 8.6 per cent.
Consumers should brace for private health insurance premiums to go up considerably next year.
"Without putting downwards pressure on those costs, you can't put downward pressure on premiums. It's simple mathematics," Mr Hill told The Sydney Morning Herald and The Age ahead of his speech to an Actuaries Institute conference in Melbourne on Wednesday.
He said insurers would have "no other option" but to pass on their rising costs to consumers.
October 22, 2019 — 6.36pm
Health services in NSW have been told they will need to find savings of $252 million under a new "treasury cap", which paramedics and health workers say will lead to cuts in emergency services and longer hospital waiting times.
Health districts across the state have been told by the state government that "NSW Health will collectively be required to achieve cost savings of $252 million" this financial year, according to documents leaked to NSW Labor and seen by the Herald.
The savings are part of a new "treasury cap" that will be introduced "across government agencies" and "will increase over the next three years", according to the leaked presentation.
Of the $252 million, $150 million are expected to come from local health districts, $67 million from ambulance, pathology and HealthShare, and $35 million from the Ministry of Health and the Cancer Institute.
The number of overseas doctors starting training to be GPs has hit a five-year high, with Australian recruits falling for a third consecutive year, despite a push by the federal government to tackle shortages in locally trained medical professionals.
Rural and regional areas are continuing to struggle to recruit Australian-trained doctors, sparking concerns for healthcare delivery outside capital cities.
The Rural Doctors Association said the number of places in GP training programs was undersubscribed in the bush this year, and rural South Australia was experiencing the biggest shortage of GP registrars.
“It’s a very disturbing trend that if we don’t try to do something about now, we’re going to get into bigger and bigger trouble down the track,” association president Adam Coltzau said.
There’s been a big rise in psychological distress among teenagers, a new report has found, as body image issues, school pressures, family conflict and bullying take a heavy toll on young people.
A new joint report by Mission Australia and the Black Dog Institute finds that one in four teenagers aged 15 to 19 say they are experiencing mental health challenges, with girls twice as likely to suffer difficulties than boys.
The findings come after 27,000 young people were tracked in a national survey in 2018. The levels of psychological distress among young people have risen from 18 per cent seven years ago to 24 per cent now. Mental health issues were as high as 32 per cent for Aboriginal and Torres Strait Islander teenagers.
October 24, 2019 — 8.52am
Inhumane drug laws based on "vote-winning" moral prejudices are failing to keep up with the rapidly changing illicit market or help the people destroyed by dependence.
World-leading drug experts warn government policies are no longer fit-for-purpose to combat the booming global supply and demand of stimulants, amphetamines, opioids and newer synthetic substances.
NSW Premier Gladys Berejiklian has again put her foot down over pill testing and has said on ABC News Breakfast that she will ignore recommendations from the Coroner.
A major series published on Thursday in The Lancet, co-authored by Sydney researchers, urges policymakers to dump morally-charged punitive measures and turn to science to curb the rising rates of devastating drug-related harms.
Jill Margo Health Editor
Oct 25, 2019 — 9.30am
A new study on how mental disorders shorten life has produced both surprising and depressing results.
This Danish study, led by an Australian, shows mental disorders are associated with a shortened life expectancy of 10 years for men and seven years for women.
While it’s long been known these disorders shorten life, the study uses a new method that provides a detailed and accurate measure of how and why this occurs.
The big surprise in the data is that the shorter life expectancy isn’t just because of suicide. Rather, it shows more cases were stemmed from general medical conditions, such as heart-disease, cancer, diabetes, respiratory disease and infection.
This current wave of violence must come to an end. Unless this happens, Hong Kong’s society may never recover from the current crisis, writes East Asia Forum's Tim Summers.
Tim Summers Contributor
Oct 21, 2019 — 3.29pm
Hong Kong’s crisis has taken another turn for the worse. While the vast majority of protesters have been peaceful, violence and vandalism have now become the norm — and for some the goal.
Clashes with the police have continually escalated. Amid the chaos, is there a way forward for Hong Kong?
The protest movement has ventured far beyond the original catalyst - the government’s extradition bill - with increasingly radical dynamics abetted by inept government responses. Social media has shaped narratives which allow groups, more than individuals, to create their own reality.
De-escalation is sorely needed, but elusive.
AFR Correspondent Michael Smith finds a dark and violent mood on the streets of what was once a vibrant Asian financial centre.
Michael Smith China Correspondent
Updated Oct 21, 2019 — 10.50am, first published at 10.48am
Hong Kong | Hong Kong's Nathan Road, a popular shopping street familiar to many Australians, was a war zone by nightfall on Sunday.
Metro station entrances and a Chinese electronics shop were on fire, shops and ATM machines were trashed, and the roads were littered with bricks, broken glass and metal poles. Police fired a water cannon with blue dye which splashed onto the steps of the city's most prominent mosque, injuring bystanders and some journalists.
At one point local residents ran screaming down side streets as police fired rounds of tear gas into a crowd of people who were clearly not protesters. Parents with young children ran for cover, an elderly woman was seen throwing up as first aid volunteers rushed to her aid.
The decision-making approach that Trump used to betray the Syrian Kurds makes Kaiser Wilhelm look like a model of cool statesmanship, and its application in a crisis involving a real great power could be catastrophic.
Ross Douthat Contributor
Oct 21, 2019 — 11.30am
For a long time in arguments about the perils posed by the Trump presidency, my watchword has been: Trump is weaker than you think. Too weak to pass legislation. Too weak to get his hacks appointed to Federal Reserve seats. Too weak to use the bully pulpit, or any instrument, to boost his approval ratings above roughly 42 per cent. Too weak to prevent leaks or maintain staff loyalty; too weak to plot dirty tricks without them swiftly being publicised; certainly too weak to hold on to power via extralegal means.
But if Trump's weakness makes him less of a threat to the constitutional order (such as it is) than some critics imagine, in foreign policy it's a different matter. There, a weak and flailing chief executive can do as much damage as a ruthless and aggressive one. A domestic weakness that produces gridlock and inertia, scandal and impeachment, is unfortunate but not necessarily disastrous. A weakness on the global stage that tempts other powers toward military aggression will risk much more significant disasters.
The bottom line risk of causing offence to China is becoming increasingly obvious to all commercial enterprises in Australia.
Oct 21, 2019 — 6.59pm
Prime Minister Scott Morrison was obviously pleased to declare his meeting with China’s Vice-President Wang Qishan in Jakarta focused on “the positive elements of our relationship which are so optimistic and so bright”.
But his optimistic claim that there is now a “very clear understanding of where Australia is coming from” is unlikely to equate to any sudden improvement in what is an ever more difficult relationship to manage.
Australia has certainly been made to understand in the last few years that China is coming from a very different place indeed.
Despite intense diplomatic efforts to engineer an invitation for the Prime Minister to visit Beijing next year, for example, there is no certainty of any break in the deep freeze on high level visits – in contrast to the guarantee of continuing heated political debate.
October 22, 2019 — 6.56am
Washington: House Speaker Nancy Pelosi, widely distributed a new "fact sheet" and video on Monday outlining what her office characterised as a gross abuse of power by President Donald Trump, including a "shakedown," "pressure campaign" and "cover up."
The releases "encapsulate all the evidence uncovered to date about the president's months-long pressure campaign to undermine the 2020 election and the extent to which he abused his power by using the levers of government to advance the scheme," according to the office of Nancy Pelosi, the speaker of the House of Representatives.
They also showed how Democrats may approach the charges, or articles of impeachment, they are expected to draw up at the conclusion of the probe. The articles of impeachment, if approved by the House, would then be sent to Senate for a trial on whether to remove Trump from office.
The Senate is controlled by Trump's fellow Republicans, who have shown little inclination toward removing him.
In the great power transitions of the past, the new hegemon was obvious. This time it's very different.
Oct 22, 2019 — 12.44pm
Almost a decade ago, China bulls like Martin Jacques and I predicted the rise of the People’s Republic at the expense of a declining United States. Today, with the two superpowers unabashedly jostling for hegemony – their trade war being just one sign of this – it is time for a fresh assessment.
It is tempting to view the US-China rivalry as just another superpower transition in a long line going back to the classical shift of power from Athens to Sparta. But this case is different.
Traditionally, a strong rising power has challenged a weakening incumbent, making the outcome preordained. The only question was whether the transition would be peaceful or violent.
This question also applies to the US-China struggle. But the outcome is far from inevitable, because the powers of both the aspirant and the incumbent are eroding – albeit in different ways.
MPs vote to back British PM Boris Johnson's deal but not his timetable for getting it done. The ball's now in the EU's court: a three-month delay is likely.
Hans van Leeuwen Europe correspondent
Updated Oct 23, 2019 — 5.49am, first published at 2.43am
London | British Prime Minister Boris Johnson has lost the battle to leave the European Union on October 31, after MPs vetoed his attempt to railroad his deal through parliament in time to quit the bloc next week.
After losing a critical vote on his departure timetable Mr Johnson immediately "paused" parliament's debate on his Brexit deal legislation, saying he'd wait and see if EU leaders agreed to postpone Brexit past October 31, and for how long.
Seemingly accepting the likelihood of a Brexit deferral - breaking his "do or die" cornerstone pledge to quit the EU on Halloween - he vowed on Wednesday (AEDT) that "one way or another, we will leave the European Union with this deal".
October 23, 2019 — 6.59am
Qamishli, Syria: The leaders of Russia and Turkey have reached a deal that will effectively end the aspirations of Syria’s Kurds to have their own self-governing entity in the country’s north-east.
The deal, reached between Turkish President Recep Tayyip Erdogan and his Russian counterpart Vladimir Putin in Sochi overnight, seeks to disarm Kurdish military forces in Syria and oust them from the border area with Turkey.
Russian and Turkish forces would then conduct joint patrols - initially with the Syrian government - to enforce their agreement.
The confusing deal appears to end the threat of a Turkish invasion of northern Syria at the cost of any hope of a Kurdish proto-state known as Rojava.
Columnist and visiting research associate at the University of Virginia’s Miller Center.
October 23, 2019 — 12.11am
In the days since President Donald Trump green-lit the Turkish attack on Northern Syria, the region has been in chaos. Civilians and activists have been killed, their murders filmed by the invading forces. Hundreds of ISIS prisoners, including high-value terrorist leaders, have escaped. Kurdish leaders, abandoned by the United States, have turned to Russia for assistance – as has Turkey, following a childish letter from President Trump.
It is one of the most foolish and most dangerous foreign policy moves of the Trump presidency. And still, Trump has celebrated his decision. He points to it as evidence of his commitment to "bring our troops home" and put America first, to stop the military interventionism of the Bush years and to end foolish wars.
But Trump’s foreign policy is not shaped by an opposition to intervention. After all, as soon as he began pulling forces out of Syria he redeployed 1800 soldiers to Saudi Arabia. Nor is it about putting America first – there is no national interest served by, for instance, withholding aid from Ukraine.
Joe Biden's stumbles and Elizabeth Warren's lack of wide appeal has triggered talk of Michael Bloomberg, Michelle Obama -- even Hillary Clinton.
Oct 23, 2019 — 11.34am
When a half-dozen Democratic donors gathered at the Whitby Hotel in New York City last week, the dinner began with a discussion of which presidential candidates the contributors liked. But as conversations among influential Democrats often go these days, the meeting quickly evolved into a discussion of who was not in the race — but could be lured in.
Would Hillary Clinton get in, the contributors wondered, and how about Michael Bloomberg, the former New York City mayor? One person even mused whether Michelle Obama would consider a late entry, according to two people who attended the event, which was hosted by the progressive group American Bridge.
It's that time of the election season for Democrats.
"Since the last debate, just anecdotally, I've had five or six people ask me: 'Is there anybody else?'" said Leah Daughtry, a longtime Democrat who has run two of the party's recent conventions.
Oct 23, 2019 — 2.48pm
Washington | America's top diplomat in Ukraine has delivered a barrage of damning evidence that President Donald Trump put pressure on a foreign nation to dig dirt on his political rivals.
William Taylor, who was appointed to the job by the Trump administration in June, delivered the explosive allegations in a closed-door Congressional hearing on Tuesday (Wednesday AEDT). His testimony served to undermine Mr Trump's claim that he never demanded a "quid pro quo" from his Ukraine counterpart Volodymyr Zelensky.
In a 15-page opening statement leaked to the press, Mr Taylor expresses shock and outrage that the administration was withholding vital military aid to the Ukraine, which is in a war with Russia, while it waited for Kiev to open a probe into Democratic presidential candidate Joe Biden and 2016 election interference.
The 50-year professional diplomat, who has served both Republican and Democrat presidents, detailed how the Trump administration shifted US policy toward Ukraine so that its newly-elected president would announce on television an investigation into Mr Biden and his son.
Oct 25, 2019 — 5.44am
Washington | Vice President Mike Pence has delivered a long-delayed assault on China for quashing the "rights and liberties" of Hong Kong, while also turning his ire on "kow-towing" US groups such as Nike and the National Basketball Association.
Speaking just as US and Chinese negotiators prepare for a new round of trade talks, Mr Pence unloaded on Beijing for its handling of pro-democracy protests in the former British colony, warning it would be harder to clinch a deal if there was violence there.
"Hong Kong is a living example of what can happen when China embraces liberty," Mr Pence told a Washington think tank on Thursday (Friday AEDT), a little more than a year since he gave a firebreathing speech that some now even regard as marking the start of a new Cold War.
October 25, 2019 — 11.00am
New York: Australia's ambassador to Washington Joe Hockey has launched a blistering attack on the isolationist tariff policies of US President Donald Trump, warning the US risks losing its economic dominance and provoking war unless it again becomes a champion of free trade.
In a speech in Missouri on Thursday night (Friday AEDT) Hockey said Trump was right to call out anti-competitive behaviour by China, but that protectionism was a short-term solution that would not solve the flaws in the global trading system.
In strikingly forthright comments from a diplomat who has built close relationships with the Trump administration, Hockey, whose term as ambassador expires early next year, said the US had made several major economic mistakes in recent years.
October 25, 2019 — 5.30am
London: Boris Johnson has demanded Parliament approve a pre-Christmas election in a vote due on Monday, in return for his letting MPs debate his Brexit divorce deal.
Johnson’s suggestion would mean a Brexit date of mid-to-late November at the earliest. However Labour is likely to block his plan.
In a letter to Labour leader Jeremy Corbyn on Thursday evening the UK Prime Minister conceded there was now no chance of getting the “do or die” October 31 Brexit he has repeatedly promised.
October 25, 2019 — 11.02am
Mario Draghi essentially failed. The outgoing president of the European Central Bank was brave, tenacious and skilful. He secured consent from Berlin for a rescue of the disintegrating Italian and Spanish debt markets in 2012. In that sense, he saved the euro.
But for all his accomplishments he does not bequeath a safely-constructed monetary union to Christine Lagarde, his unlucky successor. The task was too great. The damage from the Trichet dark age and austerity overkill ran too deep.
German and North European refusal to countenance fiscal union - albeit for valid constitutional reasons - leaves the euro an orphan currency with no pan-EMU budgetary mechanisms to counter economic shocks.
China’s ruling Communist Party leaders will meet next week to discuss “modernising the country’s governance system”, state media said on Thursday, as Beijing battles unrest in Hong Kong, a lingering trade war, and a slowing economy.
The much-delayed Fourth Plenum of the party’s central committee is a closed-door meeting of high-ranking officials where the country’s roadmap and future direction is discussed. It will run from next Monday to Thursday in Beijing, and will be the first since February last year.
State news agency Xinhua said the dates were confirmed at a meeting on Thursday of the central committee presided over by President Xi Jinping.
US progressives were hostile to Pax Americana -- until Donald Trump started trashing it. So is this a change of heart?
Bret Stephens Contributor
Oct 25, 2019 — 11.58am
Donald Trump's abrupt withdrawal of US forces from Syria has drawn widespread scorn from Republicans and Democrats alike, and with good reason: the United States has betrayed an ally and ceded influence to a gallery of rogues — Bashar Assad, Recep Tayyip Erdogan, Vladimir Putin and Qasem Soleimani, to name a few — in exchange for a hollow talking point about ending endless wars.
But give Trump this: he's turning a remarkable number of foreign policy liberals and progressives into born-again neo-conservatives.
That's a thought worth pondering as the President pursues a foreign policy that, had it been undertaken by a Democratic administration, would likely have been met with considerable approval on the left. After all, getting America out of fill-in-the-blank — Vietnam, Nicaragua, El Salvador, Iraq, Afghanistan — has for decades been the go-to slogan of progressives.
Why, now, should our retreat from Syria be any different?
Columnist, co-host of Ten's The Project and academic
October 24, 2019 — 11.34pm
The hazard with writing anything about Brexit is that it is out of date before you've finished the piece.
That's especially true in this whirlwind week in which Boris Johnson seems to have suffered his greatest humiliation, his grandest success, then his most galling frustration mere days, or even hours apart.
His Brexit deal hammered out with the EU was already a regressive compromise on what Theresa May had managed, and basically echoed what the EU had suggested years ago.
Imagine calling the Parliament to sit on a Saturday only to have them reject it. Then imagine them voting for it on Tuesday, only to turn around immediately and delay its implementation so it's completely moot – more or less forcing the EU to delay Brexit again.
I look forward to comments on all this!
Posted by Dr David G More MB PhD at Thursday, October 31, 2019