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In the US we see the House passing a huge stimulus bill while the calm overall continues and Biden launches his first military action. We now need to see how the Senate deals with the stimulus. It may be hesitant on a number of the plans!
In the UK calm seems to have also returned but the big issue now is going to be how to pay for all the actions that have been taken. It won’t be easy, and the recent Budget makes that clear.
In Australia we see the Government crippled by all the issues surrounding treatment of women by politicians of both political persuasions. It is really hard to see just how all this will be sorted to the satisfaction of the public and politicians. Otherwise our economic recovery seems to be doing better than expected. I hope it continues along with a smooth vaccine rollout, which we can only hope might speed up s bit!
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Major Issues.
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Opportunity knocks — open the door, PM
The pandemic and the impact it has had on the budget present the Coalition government with a unique opportunity: the chance to do something. I don’t mean simply preside in office, tinkering at the margins of policy or holding media conferences claiming to have achieved meaningful reform. I’m talking about actual substantial change.
Let’s face it, as much as politicians like to strut around the corridors of power in Parliament House and ride in the white car with the flag on the bonnet, all the while imagining they are on the set of The West Wing, most don’t leave much of a mark. The same goes for ministers, who tend to become captured quickly by their departments, no matter how many ideas they floated early in their political careers.
Even the few who rise to become prime minister don’t really achieve a lot. If you think about the game-changing achievements of modern prime ministers, at best they can point to a handful of meaningful reforms they have championed. Bob Hawke oversaw important micro-economic reforms and the Accord with the unions. Paul Keating was responsible for the introduction of superannuation. John Howard broadened the tax base with the GST and reformed gun laws. Kevin Rudd said sorry to Indigenous Australians. Julia Gillard introduced a price on carbon, only for Tony Abbott to repeal it. Malcolm Turnbull oversaw the introduction of same-sex marriage, although by the time he did so Australia was already a global laggard and it really was the people’s achievement anyway via a popular plebiscite.
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Here’s the unspeakable truth about the strange behaviour of interest rates
Ross Gittins
Economics Editor
February 22, 2021 — 12.00am
In these unprecedented times, Reserve Bank governor Dr Philip Lowe is having trouble explaining his actions and motivations because there are various things someone with his degree of influence feels he can’t admit. But I’m under no such constraint. So let me have a go at giving you the message he won’t.
Despite Lowe’s reticence, he’s a fundamentally honest person and if you study what he’s saying – and avoiding saying – you can join the dots.
Long before the coronavirus appeared on the horizon early last year, the rich economies had been caught in a low-growth trap caused by a global imbalance between how much people wanted to borrow and invest, and how much other people wanted to save and lend. Around the world, interest rates were heading close to zero.
With our economy growing at a rate well below its “potential” to produce more goods and services, Lowe slowly and reluctantly cut our official interest rate. He was reluctant because he knew that, with rates already so low and households already so much in debt, cutting rates further would do little to help.
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Outlook for equities is the best Chris Stott has ever seen
Tom Richardson Markets reporter and commentator
Feb 22, 2021 – 12.00am
Chris Stott says he found his mind constantly drifting back to markets during a gap year spent on overseas adventures ranging from the mud, heat and humidity of the Kokoda Track to an Ashes Test at Lord’s in 2019.
The fund manager, who made his name over 12 years at Wilson Asset Management from 2006 to 2018, says lots of options were on the table after Wilson, but the pull of markets was too strong to resist.
In December 2019, Stott and a former Wilson colleague, Martin Hickson, got together to raise some money and launch 1851 Capital. By the February 1, 2020, launch date the fund had invested about $80 million, but the fundies were unaware of the roller-coaster year ahead.
“It was a fascinating time to try and start the fund,” Stott says. “A really hard first two months, the first three weeks we were going really well, then COVID accelerated, so that all changed.
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Ray Dalio’s six questions for assessing stock bubbles
Timothy Moore Online editor
Feb 23, 2021 – 8.46am
All the talk about the US equity market being in a bubble has led Ray Dalio to detail the six questions that he asks to make his own assessment of prices.
“What I mean by a bubble is an unsustainably high price, and how I measure it is with the following six measures.
- How high are prices relative to traditional measures?
- Are prices discounting unsustainable conditions?
- How many new buyers (ie, those who weren’t previously in the market) have entered the market?
- How broadly bullish is sentiment?
- Are purchases being financed by high leverage?
- Have buyers made exceptionally extended forward purchases (e.g., built inventory, contracted forward purchases, etc.) to speculate or protect themselves against future price gains?
By Mr Dalio’s assessment, there is no current “overall” bubble.
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Equity investors should stop fretting about rising interest rates
Rather than fear the bond market, equity investors can prosper from a stronger economy that boosts earnings and, yes, also leads to higher interest rates. It’s called a recovery.
Michael Mackenzie
Feb 22, 2021 – 11.10am
Bond bears are growling louder and that poses a serious question for equity investors. When should they really start worrying about rising 10-year interest rates?
Global economic growth and corporate earnings estimates are picking up, confirming upbeat investor expectations that have propelled equity and commodity prices sharply higher in recent months. Also on the rise are 10-year global interest rates. In the US, Japan, China, Australia, Europe and the UK, they are now at their highest levels in nearly a year.
That is part of the process of validation by financial markets that comes with economic recovery, even when bond yields have been driven down to historically low levels by massive buying programmes of central banks.
“Bond yields moving higher from abnormally low levels suggests rising private sector confidence, and healthier economic and profit growth prospects,” says James Paulsen, chief investment strategist at the Leuthold Group.
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‘Not a nice person’: Man accused of Parliament rape stood down from current job
By Katina Curtis, Nick Bonyhady and Alexandra Smith
February 23, 2021 — 5.00am
The former Liberal staffer accused of rape by three women and sexual harassment by another has checked himself into a private clinic after being stood aside from his job at a large corporation.
Former government staffer Brittany Higgins has alleged the man raped her in the office of their boss, then-defence industry minister Linda Reynolds, in March 2019, three weeks after she started the job. Three other women have since come forward with allegations of assault or harassment by the same man.
Ms Higgins intends to make a formal statement to police on Wednesday afternoon to reactivate an investigation into the incident.
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McKenzie, Dutton put democracy at risk with actions that reek of playing politics with public money
Tony Harris
Former NSW auditor-general
February 23, 2021 — 11.39am
On Friday, the Commonwealth Auditor-General, Grant Hehir, gave evidence to the Public Accounts and Audit Committee of Parliament that the government’s $6.4 million cut in his budget would mean reduced audits. This was not regrettable news to the Morrison government.
Among its members are MPs who appear to have shown a level of disregard for what were once accepted standards of accountability and probity that can only be described as brazen.
For example, Senator Bridget McKenzie, former sports minister, gave evidence the previous Friday to the Senate committee investigating the sports rorts affair. She took full responsibility for her staff and her own actions in managing the Community Sports Infrastructure Grants Fund. And she was proud of her achievements.
McKenzie did not acknowledge that she had, in the view of legal experts, no legal powers to do what she did. There was no reference to her having stripped 300 grants off more meritorious applicants so she could, in the judgment of the Audit Office, advantage marginal seats. Her only blemish was to forget to declare membership of sports bodies.
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We know what it takes to raise men who don’t rape, so why don’t we act on it?
Steve Biddulph
Author
February 23, 2021 — 12.10am
The world of manhood has a deep divide running throught it. Most contemporary men, and most teenage boys thankfully, are caring and ethical. They like and value the women in their lives, and treat them with empathy and respect. They are comfortable around women and negotiate sexuality as a happy and equal dance.
But co-existing with this, and present all around us, is a dark shadow masculinity. Dangerous and predatory men still abound in our culture, in sufficient numbers to make it grimly unsafe to be a girl or a woman. We have seen this in politics, the church, sport, healthcare, aged care, schools, and simply out on the streets.
The account of a young woman being raped in Parliament House brought the topic back yet again. Followed quickly by the hundreds of Sydney schoolgirls who came forward to talk about sexual assaults as young as their early teens in response to a petition circulated by Chanel Contos, a former Kambala student. Last year it was the chanting of St Kevin’s School boys of aggressively sexual songs on a public tram. And every year, the sexually motivated murders that haunt us all.
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Reform aims to cut costs and simplify SMSFs
Trustees frustrated by excessive paperwork and expensive advice frameworks will be watching two government initiatives with great interest.
John Maroney Contributor
Feb 24, 2021 – 12.00am
There is growing momentum for financial services reform that could see the cost of administering a self-managed super fund fall, with federal Treasury and the Australian Securities and Investments Commission issuing independent consultation papers that could cut red tape and complexity.
Treasury has called for submissions to its consultation paper, Modernising Business Communications, which has the goal of “cutting business costs (including superannuation) and better reflecting the way Australians want to engage and communicate digitally”.
Trustees are required to retain physical written records of decisions made about the storage of collectables such as artwork, antiques, jewellery and similar items and to retain them for 10 years. PHIL CARRICK
Running parallel to this is ASIC’s consultative paper 332 – Promoting Access to Affordable Advice for Consumers – that has asked the financial advice industry and other stakeholders to outline what impedes the delivery of good-quality, affordable personal advice.
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Worst may be over for share investors seeking income
By John Collett
February 23, 2021 — 10.30pm
As the February earnings season draws to a close, it is clear that many of the large-cap stocks favoured by smaller investors and retirees to generate income have come through the worst of the COVID-19 induced sharemarket slump as the economic recovery picks up steam.
The highly popular big banks are emerging in relatively good shape, as evidenced by the earnings of the Commonwealth Bank. Although its profit was down, as expected, the country’s biggest mortgage lender said it would increase its interim dividend to $1.50.
Shane Oliver, chief economist at AMP Capital, says 57 per cent of companies that have reported so far have posted a rise in profits, up from just 36 per cent six months ago, when results were affected by widespread lockdowns during the first half of last year.
Telstra posted lower earnings due to an ongoing squeeze on profit margins from its fixed-line business and from the economic effects of COVID-19.
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Morrison’s JobSeeker boost is stingy, mean and bad for the economy
Jessica Irvine
Senior economics writer
February 25, 2021 — 12.15am
I’m powering my home and eating for free thanks to COVID-19. I discovered this remarkable factoid after running the sums on the effect of recent tax cuts and interest rate reductions on my household budget.
As a high-income-earning mortgage holder, my windfall has been twofold. First, last year’s tax cuts have delivered a boost to my take-home pay of about $93 a fortnight, or $6.66 a day. Meanwhile, the interest rate payable on my $700,000 (ish) mortgage has fallen from 2.69 per cent to about 2.13 per cent (thanks also to some savvy shopping around). This boosts my bottom line by about $150 a fortnight, or $10.74 a day.
All up, I’m $17.45 a day ahead – about $530 a month – thanks to the government and Reserve Bank’s COVID-inspired support measures. I usually spend about $350 to $400 dollars a month on food and just over $100 on my power bill.
Exactly why I, as a highly educated media professional, should have been targeted by the government and policymakers in this way remains something of a mystery to me, particularly at a time when they’re working feverishly to shake down global tech giants to pay a portion of my salary. Thanks, fellas!
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Higher education: University grants may be tied to research that sells
Future government grants to universities could be tied to boosting the commercialisation of research, as institutions are urged to change their business models away from an over-reliance on international student revenue to refocus on educating Australians.
And in a signal of changes to intellectual property laws, vice-chancellors, business leaders and academics will be told the nation’s key institutions need to engage in the creation of new industries, sovereign capabilities and the great public policy challenges facing the country or Australia risks falling behind the rest of the world.
Education Minister Alan Tudge — in a call to arms for the university sector to become a key player in the post-pandemic retooling of the economy — will on Friday tell academics at Melbourne University that the current model, where an average 25 per cent of revenue relied on international students, had not only been disrupted by COVID-19 but was not sustainable beyond the pandemic.
“Now is the time to make this change, not just because our economy needs it, but because university business models have been severely disrupted by COVID,” Mr Tudge will say in his first major speech on higher education since becoming minister in December.
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Chinese students told not to study in Australia
Julie Hare Education editor
Feb 25, 2021 – 5.37pm
Beijing’s dispute with Australia appears to have reached a new low, with education agents based in China given a directive not to send students to Australia.
Duncan Maskell, vice-chancellor of the University of Melbourne, said he had been in communication with staff in China who had raised concerns about Chinese students being given advice to not study at an Australian university.
“Our people have said that [such advice to potential students] is being given out in the regions, but not in Shanghai or Beijing. It could all be tittle tattle at the moment because we don’t have a sense of how serious it is,” Professor Maskell said.
“As with many things like this in China, you struggle to understand whether, at one end of the spectrum, it is a directive or just some pressure on agents not to recommend Australia as a destination.”
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Super should be used ‘more effectively’: Frydenberg
Phillip Coorey Political editor
Feb 25, 2021 – 10.30pm
Treasurer Josh Frydenberg says retirees must be encouraged to draw down their superannuation savings “more effectively”, but he is yet to decide whether to limit the capacity to save for retirement by capping the superannuation guarantee.
In a speech to be delivered to a retirement income forum in Canberra on Friday, Mr Frydenberg will echo previous comments by the Minister for Superannuation, Jane Hume, who believes super funds should be compelled to offer new retirement income products so people use more of their super rather than hoard it.
The government’s retirement income review, led by former Treasury official Mike Callaghan, identified that many retirees die with most of their wealth intact and do not run down their super or tap equity in their home, so they may be saving too much.
Mr Frydenberg will cite that giving retirees “more confidence and guidance” to assist them in drawing down on their super savings more effectively “is critically important to improve the quality of life for Australians in retirement”.
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https://www.afr.com/wealth/personal-finance/worst-bond-blood-bath-since-1994-20210225-p575nn
Worst bond bloodbath since 1994
It’s one of the worst blood-baths “long duration” bond lovers have endured since the great crash of 1994, ramming home the interest rate risks that have been lurking behind these investments for years.
Christopher Joye Columnist
Feb 26, 2021 – 11.55am
It is one of the worst bloodbaths “long duration” bond lovers have endured since the great crash of 1994, ramming home the interest rate risks that have been lurking behind these investments for years.
A massive jump in 10-year Australian interest rates, which have more than doubled since November, has hammered the price of fixed-rate, as opposed to floating-rate, bonds.
On a rolling 90 trading day basis, the fixed-rate AusBond Composite Bond Index has lost over 3.7 per cent (with more to come) in the past three months alone, and is off over 4 per cent since its early-November peak.
This should be distinguished from the zero duration AusBond Floating-Rate Note Index, which is up 0.04 per cent, not down, in the month of February. (Duration is a measure of an investment’s sensitivity to interest rate changes.) The FRN Index is also up 0.23 per cent since the Composite Bond Index started plummeting in November.
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https://www.afr.com/wealth/personal-finance/the-survival-guide-to-income-investing-20210224-p575go
The survival guide to income investing
In a world turned upside down by a near-zero cash rate, minuscule bond yields and hyper government stimulus due to COVID-19, we highlight yield opportunities you may not have thought of.
Tony Featherstone Contributor
Feb 27, 2021 – 12.00am
A decade ago, investors could earn 6 per cent from a one-year term deposit. Cash was a no-brainer for those living off portfolio income. Today investors seeking a similar yield are buying emerging-market sovereign bonds, junk bonds, private credit, hybrids, unlisted assets, resource shares and microcaps.
Welcome to income investing in 2021 – a world turned upside down by a near-zero cash rate, minuscule bond yields and government hyper-stimulus due to COVID-19.
“Conditions for income investors are as hard as I’ve seen,” says AssureInvest founder Andrew Doherty. “It’s unthinkable for the return on cash to be negative after inflation, or for growth assets to offer a higher yield than defensive assets over the past few years.”
The yield on Doherty’s Australian shares model portfolio, which has had top-quartile performance over six years, is just 3 per cent (before franking).
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Bond yields take wrecking ball to equity markets
William McInnes Reporter
Feb 26, 2021 – 4.50pm
A sharp rise in bond yields turned investors fearful on Friday, setting off a sell-off in global equity markets that crippled growth stocks and knocked the Australian dollar off its three-year high above US80¢.
Expectations for a swift recovery in the global economy that will be accompanied by long-dormant inflation have infiltrated the bond market and sent yields soaring on Thursday, but the biggest pain was felt in technology stocks from Wall Street to the ASX’s buy now, pay later heroes.
“This reporting season has been the best that I can remember [except] maybe the first year of the recovery post the GFC.”
— WaveStone Capital principal Raaz Bhuyan.
The S&P/ASX 200 Index tumbled 2.4 per cent to a three-week low on Friday, in its worst session since September, wiping almost all its gains for the month. That followed a rout on Wall Street where the S&P 500 plummeted 2.5 per cent. The Nasdaq lost 3.5 per cent.
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Universities brace for Chinese student hit after COVID
By Lisa Visentin and Eryk Bagshaw
February 27, 2021 — 5.00am
Australia’s universities face the prospect of a prolonged Chinese student drought as reports sweep through the multi-billion dollar industry that Chinese agencies are being encouraged by local authorities not to send students to Australia.
The universities first began receiving these reports at the beginning of this week, at which point the advice not to recommend or advertise Australian universities appeared to be circulating only to agents in smaller regional cities. By Thursday, university sources confirmed some reports had expanded to include Beijing and Shanghai, China’s two largest cities.
Group of Eight chief executive Vicki Thomson said her member universities – which include the University of Sydney and the University of Melbourne – had heard the reports but their veracity remained unclear as there had been no official notification from Chinese authorities.
“There is definitely something afoot. Either agents are being told not to direct students here or they are being told not to mention Australia as an option for study. But we’ve had no official notification from anybody,” Ms Thomson said.
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Frydenberg, a fixer with his eye on greatness
Peter Hartcher
Political and international editor
February 27, 2021 — 12.00am
Josh Frydenberg starts every day in his Canberra office by mounting his exercise bike. As he pedals, his gaze inevitably falls on the portrait of his hero – General Sir John Monash, one of the greatest Australians who ever lived.
The brilliant strategist who turned the tide of World War I didn’t receive the full recognition he deserved during his lifetime, the result partly of antisemitism. Frydenberg is on a relentless campaign to correct history’s oversight and promote Monash’s legacy.
So the Australian Treasurer begins the day with his eyes fixed on greatness. He is not in that class. Not yet, at least. But this week he edged himself in the right direction with an unequivocal success.
His victory over Facebook and Google, two of the biggest and most arrogant multinational corporations on earth, was noted worldwide. Governments everywhere are puzzling over the problem of how to civilise the so-called Big Tech firms.
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There’s no excuse, we need full employment now
Ross Gittins
Economics Editor
February 26, 2021 — 11.36am
In his new book, Reset, outlining a plan to get the economy back to top performance, Professor Ross Garnaut makes the radical proposal to keep stimulating the economy until we reach full employment within four years. Excellent idea. But what is full employment? Short answer: economists don’t know.
In principle, every economist believes achieving full employment is the supreme goal of economic policy, because it would mean using every opportunity to get everyone working who wants to work and so achieve the maximum possible rate of improvement in our material living standards.
In practice, however, we haven’t achieved full employment consistently since the early 1970s – a failure that few economists seem to lose sleep over. It’s like St Augustine’s prayer: Lord make me pure – but not yet.
The economists’ ambivalence starts with the truth that, contrary to what you’d expect, full employment can’t mean an unemployment rate of zero. That’s because, at any point in time, there’ll always be some people moving between jobs.
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$1bn in coal stranded by China can’t be sold
8:43PM February 26, 2021
Over $1bn of Australian coal stranded off the coast of China has lost the bulk of its value and can no longer be sold to alternative buyers, the latest blow to one of the nation’s biggest export earners.
Beijing in January instructed the owners of the banned Australian coal to find new buyers outside of China, as Xi Jinping’s administration scuttles the $14bn export trade and ramps up pressure on the Morrison government.
However, ASX-listed Coronado Global Resources said the coal has been stuck offshore for so long that its value would have plunged and selling it to rival destinations was no longer a realistic option. Some of the 70 vessels laden with Australian coal have been stranded since June.
The flotilla “has not moved, so it‘s clearly a boycott,” Coronado chief financial officer Gerhard Ziems told The Australian. “I don’t believe the Chinese are selling these cargoes to anyone else and now it’s too late because the coal deteriorates over time. So I don’t think they will find a lot of buyers.”
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https://www.afr.com/politics/federal/the-dark-irony-in-scott-morrison-s-letter-20210226-p5762a
The dark irony in Scott Morrison’s letter
It’s a very black irony that in a building full of lawmakers, the police have to write to those lawmakers to point out that if a crime has been committed, they need to report it.
Laura Tingle Columnist
Feb 26, 2021 – 3.54pm
It was hard not to see some very black ironies in the letter written by Prime Minister Scott Morrison to the President of the Senate, Scott Ryan, and the Speaker of the House of Representatives, Tony Smith.
“Dear President and Speaker,” he wrote.
“I attach for the information of Members and Senators advice I have received from the Commissioner of the Australian Federal Police, Reece Kershaw APM, regarding the appropriate process for making complaints or reporting allegations of criminal activity, including sexual assault.”
Kershaw had told the Prime Minister in his letter that “in light of recent media reporting, including allegations of sexual assault, I write to advise the manner in which allegations of criminal conduct must be referred to the Australian Federal Police for investigation”.
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https://www.afr.com/policy/foreign-affairs/slogan-led-strategy-isn-t-working-20210226-p5762j
Slogan-led strategy isn’t working
Australia’s tough line on China could be easily undermined by Beijing -- and by our own allies too.
James Laurenceson Contributor
Feb 26, 2021 – 12.42pm
Australia’s China relations problem has two parts. The first is China’s bad behaviour: unleashing trade punishment, spreading misinformation, refusing to engage in dialogue, and more.
The reality of what Australia faces must be recognised and not excused. And it demands a serious strategy in response.
This leads to the second problem: Australia’s current strategy is best described as a collection of slogans that appear to reflect wishful thinking more than considered calculations grounded in evidence.
The present approach serves as self-medication, making us feel better about our predicament, and providing temporary relief from having to admit deeper drivers of tension and a need to make tough choices in a world less accommodating of Australia’s preferences.
But in the longer term, the national interest is left exposed.
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Beware the inflation monster: Time to lock in your mortgage rate?
Noel Whittaker
Money columnist
February 27, 2021 — 11.00pm
The world is full of much better financial news but some investors remain more confused than ever.
The success of COVID-19 vaccines worldwide gives us cause for optimism but it also likely signals the start of a new financial threat: inflation.
If business activity continues to pick up, all that economic stimulus cash pouring into world markets would likely be eased back.
Already, many big investors are dumping sovereign bonds, with the US 10-year bond yield jumping to nearly 1.4 per cent and the Australian 10-year yield now at more than 1.6 per cent.
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Coronavirus And Impacts.
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No one is safe from the virus until everyone’s vaccinated globally
To avoid living in a fortress behind shut international borders, rich countries must take action to make the vaccines accessible to developing nations.
Mohamed El-Erian Contributor
Feb 23, 2021 – 12.00pm
Recognising that “no one is safe until everyone is safe”, the G7 recently announced additional steps to facilitate globally more “affordable and equitable access to vaccines, therapeutics, and diagnostics” to combat COVID-19.
But translating stated intent into effective action will require bold political leadership at home and support for developing countries that goes well beyond financial aid. Getting it right won’t be easy, but the effort is essential if rich countries wish to avoid living in a fortress with the mentality to match.
The inequality in vaccine availability and deployment is stark. According to United Nations Secretary-General António Guterres, just 10 countries account for 75 per cent of all COVID-19 vaccination so far. More than 130 countries have not administered a single dose.
In the face of such inequality, the G7 agreed to increase pandemic-related aid to $7.5 billion and urged others, including G20 countries and multilateral organisations, to enhance their support for developing countries, be it through the COVAX facility or the Access to COVID-19 Tools Accelerator initiative.
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Get some answers but the COVID-19 vaccine rollout is in safe hands
There are serious questions over how a doctor who had not received training came to administer the Pfizer vaccine at St Vincent’s Care Services in Brisbane.
But the dosing error and the apparent negligence of the contractor who employed the doctor, Healthcare Australia, is not cause for wider concern about the safety of the vaccine rollout in hospitals and nursing homes across the country.
The two elderly residents who were the unfortunate victims of the error are not ill, and Pfizer has given similar doses that they received to volunteers in clinical trials with no adverse effects.
Clearly the error should not have happened, and it is hard to imagine how the doctor got the dosing so wrong. But in almost every other site where vaccines are being administered, competent, careful and judicious doctors and nurses are administering thousands of doses without incident, with multiple layers of checks and balances that should foster a high degree of confidence.
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Climate Change.
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https://www.afr.com/policy/energy-and-climate/can-bill-gates-fix-the-climate-20210210-p571ab
Can Bill Gates fix the climate?
The billionaire Microsoft co-founder and philanthropist has a plan. Now he has to persuade the world to get with the program.
Tom McIlroy Political reporter
Feb 20, 2021 – 12.00am
If you believed everything you saw about Bill Gates on the internet, you’d think the Microsoft co-founder wanted to enforce mandatory vaccinations around the world, replace democracy with a cabal of ruling elites and implant seven billion people with microchips.
The truth is a good deal simpler: while the COVID-19 pandemic hogged the headlines, the billionaire philanthropist and author has been quietly working to avert a man-made climate disaster. His solution is presented in his third book: How to Avoid a Climate Disaster: The Solutions We Have and the Breakthroughs We Need, which was published on Monday by Penguin Random House.
Gates is the first to admit he’s “an imperfect messenger” in the fight to save the globe, but he knows that his public profile means people will listen to what he has to say.
The book should have been published in 2020, but it was decided to delay its release while the world came to grips with the pandemic. A silver lining of the pause is that, with Joe Biden’s defeat of Donald Trump, action on climate change appears back in fashion after four years of going backwards in Washington.
AFR Weekend is on a video link-up with the 65-year-old billionaire, who is speaking to a group of journalists from across the Asia-Pacific.Gates, dressed in his trademark business shirt and sweater, is just getting warmed up as the global publicity machine for his book notches up.
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Australia will pay the price for not joining the climate club
Australian trade partners are gearing up for a low-carbon economy, and with a new EU impost looming, our biggest exports could be left out in the cold.
Jacob Greber and Hans van Leeuwen
Feb 26, 2021 – 7.00pm
Scott Morrison probably isn’t particularly familiar with the Nobel prize-winning economist William Nordhaus. But if he were, the Prime Minister might find a place for the US sage of climate economics on his political dartboard.
It was Nordhaus who in 2015 coined the term “climate club”. He envisaged a group of countries, sharing an ambitious emissions-reduction program, that would slap tariffs on dirty outsiders to stop them free-riding on all the club’s hard work.
The idea has been in circulation ever since. Suddenly, though, it’s hard currency. In the corridors of Brussels, bureaucrats are now metaphorically measuring up the climate club’s curtains and writing the rules of membership.
And with Joe Biden ensconced in the White House, putting climate action at the centre of everything his administration does, the Europeans feel emboldened to press on with plans for a carbon border adjustment mechanism (CBAM) – a tax on imports based on the amount of carbon used in making and shipping products from non-club members such as Australia, which are seen to have inadequate carbon-shedding zeal.
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Royal Commissions And The Like.
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No entries in this section.
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National Budget Issues.
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Universities dealt dud hand in JobKeeper funding lottery: Garnaut
Julie Hare Education Editor
Feb 21, 2021 – 2.14pm
Universities and casinos both experienced “catastrophic” declines in revenue during pandemic lockdowns, yet the disgraced gambling behemoth Crown Casino received $115 million in JobKeeper payments in the first four months of the scheme while the university sector received zero.
Economist Ross Garnaut said Crown Casinos employed 15,000 people compared with 130,000 in universities, which also accounted for many hundreds of thousand more jobs indirectly.
“The universities have their imperfections, which can usefully be corrected, but few would doubt their superiority over casinos in terms of their national contribution,” Professor Garnaut writes in his new book Reset: Restoring Australia after the Pandemic Recession, out Monday.
Professor Garnaut said that preceding the pandemic, Australia’s economy was beleaguered by unemployment and underemployment, wages stagnation and slow productivity growth. One of the bright spots in an otherwise stagnant economy was the dynamism of the university sector.
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Victorian government finishes last financial year with operating deficit of $6.5bn
The true extent of the financial damage caused by the COVID-19 pandemic on Victoria has been revealed, and the figure runs into the billions of dollars.
Anthony Piovesan
NCA NewsWire
February 22, 202112:54pm
The Victorian government finished the last financial year with an operating deficit of $6.5bn compared with a forecast surplus of $600m.
Department of Treasury and Finance secretary David Martine told a parliamentary inquiry on Monday that the 2019-20 bushfire season and the COVID-19 pandemic caused the state to face “its most significant shock since the Great Depression”.
He also revealed to the Public Accounts and Estimates Committee (PAEC) that he Victorian government’s net debt was $44.3bn at June 30, 2020, attributing that to “increased borrowing requirements” to support the state’s COVID-19 recovery.
“The impact of the coronavirus pandemic contributed to the first annual fall in economic activity since the 1990s recession, with gross state product declining by .5 per cent for the year 2019-20,” Mr Martine said.
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https://www.afr.com/policy/economy/exports-to-china-drop-8pc-as-iron-ore-slashed-20210223-p574za
Exports to China drop 8pc as iron ore slashed
Matthew Cranston Economics correspondent
Feb 23, 2021 – 2.16pm
Exports of goods to China fell by $1.1 billion, or 8 per cent, in January as Australia’s top trading partner bought less iron ore, cereals, wine and meat.
The value of iron ore shipments to China in January dropped by $471 million, or 5 per cent, to $9.7 billion. Only the record iron ore price prevented a further slide in the value of exports. Prices rose 8 per cent in the month.
China still bought 80 per cent of Australia’s exports of the commodity in January.
The volume and value of Australia’s iron ore exports fell in January.
The quantity of iron ore exported dropped by 7.2 million tonnes, or 12 per cent.
Cereal exports declined by $213 million, or 77 per cent, and meat exports fell by $106 million, or 41 per cent, according to Australian Bureau of Statistics data released on Tuesday.
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https://www.afr.com/policy/economy/rba-will-defend-its-credibility-20210223-p57513
RBA will defend its credibility
Traders are questioning the credibility of RBA governor Philip Lowe’s “best guess” that he will delay raising interest rates until at least 2024.
John Kehoe Senior writer
Feb 23, 2021 – 3.48pm
When the Reserve Bank of Australia’s trading desk wades back into government bond markets this week, expect it to step in more aggressively to defend its word.
The three-year federal government bond yield has untidily hovered a few basis points above the RBA’s 0.10 per cent target in recent days, spiking as high as 0.14 per cent on Monday and floating around 0.12 per cent on Tuesday.
Traders who are nursing financial losses from the heavy bond selling are questioning the credibility of RBA governor Philip Lowe’s “best guess” (though not a “pledge”) that he will delay raising interest rates until at least 2024.
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https://www.afr.com/policy/economy/interest-rate-rise-bets-for-2022-spook-market-20210223-p574zo
Interest rate rise bets for 2022 ‘spook’ market
John Kehoe Senior writer
Feb 23, 2021 – 1.23pm
Financial markets are challenging the Reserve Bank of Australia’s interest rate guidance, pricing in the first post-COVID-19 rate rise late next year – about two years ahead of the RBA’s expectations.
The roll out of vaccines, high mining commodity prices and a more than $2 trillion spending stimulus planned by US President Joe Biden are fuelling more optimistic economic sentiment.
Bond investors now seriously doubt RBA governor Philip Lowe will be able to stick to his plan – articulated just three weeks ago – to hold off raising the 0.1 per cent cash rate until 2024 “at the earliest”.
Bets made by professional interest rate traders in the overnight indexed swap market indicate the first hike in the cash rate to 0.25 per cent could occur around late 2022, before the RBA raises the cash rate again to 0.5 per in 2023.
Commonwealth Bank of Australia interest rate strategist Philip Brown said: “The market has, seemingly, decided that the RBA will be raising rates in 2022.”
“We can’t agree,” he said.
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Take it or leave it: Government won’t budge on JobSeeker’s $25-a-week rise
By Jennifer Duke and Shane Wright
February 23, 2021 — 6.11pm
The $50-a-fortnight increase in the dole will be ‘take it or leave it’ when the proposed boost goes to Parliament on Wednesday, following fierce criticism from social services groups and Labor, which say the rise is too small.
The federal government is planning to increase the base rate of JobSeeker from $565.70 a fortnight to $620.80 on April 1 – equating to a payment of about $44 a day. This includes a $25-a-week rise and an additional increase in March due to inflation.
The Morrison government will not accept any amendments or attempts to increase the new rate, which a senior Liberal source said was the “bare minimum” to win Coalition party room support and satisfy public demand for action.
While the increase is the first major rise in the rate since the 1980s, it is well below the level suggested by business groups, social services organisations and economists who have suggested hikes worth more than double this figure. It is also below the existing $150-a-fortnight coronavirus supplement that ends on March 31.
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Commonwealth Bank cuts rates again, dealing another blow to savers
· NCA NewsWire
Commonwealth Bank has dealt another blow to savers by slashing interest rates on a slew of deposit accounts.
The major bank on Friday shaved five basis points from standard and conditional savings accounts for the second time this month.
CBA’s standard Netbank saver now attracts an introductory five-month rate of 0.4 per cent before reverting to a measly ongoing rate of 0.05 per cent.
Its conditional Goal Saver account has been cut to a maximum rate of 0.35 per cent — the lowest on offer out of the big four banks.
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Recovery delivers $15bn federal budget boost
A better than expected economic recovery has boosted the federal budget by $15bn so far this financial year, more than offsetting a global spike in government borrowing costs as inflation fears mount.
Higher revenues and lower expenses have left the budget deficit at $134bn for the first seven months of the financial year, the Finance Department revealed on Friday, compared to $149bn which was expected when the government last updated the budget in December.
Finance Minister Simon Birmingham said the better figures provided further evidence the economy was bouncing back.
“More people in jobs and fewer people on JobSeeker and JobKeeper means that our financial position continued to improve, even when compared to forecasts released last December,” he said.
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Health Issues.
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Cancer-free after 12 years: Why you’re hearing the C-word more often
Two ASX-listed ventures are among the companies now investing billions of dollars to develop an emerging immunotherapy treatment known as CAR-T. From the upcoming Innovation issue, out on February 26.
Yolanda Redrup Reporter
Feb 25, 2021 – 10.05am
Laurie Adami was 45 when she began “feeling crummy”, exhausted and plagued with constant sinus infections.
It was 2006 and the high-flying tech executive, who was juggling her career while raising a young son, was told by doctors her blood tests looked normal. Given she was a busy working mum, they opined, it was hardly surprising she was tired at the end of the day.
But having worked for 24 years – many of them flying to New York and London every month from Los Angeles, where she was a president at a software company – Adami was no stranger to tiredness. She knew this whole-body exhaustion was something else.
On Good Friday 2006, she was diagnosed with stage four follicular non-Hodgkin’s lymphoma, after a PET-CT scan revealed a mass the size of a grapefruit. Her cancer was considered treatable, but not curable.
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https://www.lexology.com/library/detail.aspx?g=e56f5058-bfed-474a-8713-bdca2d2db549
Post COVID transformation of the Australian healthcare system
Australia February 24 2021
Andrew Hii, Simon Burns, Michael Caplan, Melissa Fai, Tim Gole, Sheila McGregor and Lesley Sutton
Gilbert + Tobin recently hosted a panel discussion with Dr Amith Shetty, Professor Jeremy Chapman AC, and Richard Alcock AO, moderated by Technology + Digital Partner, Andrew Hii.
The panellists discussed the prevailing local and global trends in the healthcare sector, focussing on:
- the future of healthcare and the benefits and limitations of digital health solutions;
- the challenges for innovation and investment in healthcare; and
- the significance of data governance, including the benefits and risks involved in the use of data.
We have summarised below the key discussion points.
What does the future of the healthcare sector look like?
The trends in the global healthcare landscape include the move toward care in the home, with hospitals shifting towards larger ICUs and high-care admissions. This trend goes hand-in-hand with the increase in digital health solutions applied in the home, and emphasis on patients having greater control over their care. For example, chronic diseases can now be managed at home by patients with specific tools and support from their general practitioners over Zoom. This trend is also evident in the aged care sector, where people are electing to live at home for longer.
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International Issues.
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Donald Trump staved off impeachment with threat to start his own party, says adviser Jason Miller
Donald Trump’s senior adviser says the former US president used the “leverage” of starting his own political party to ensure Republicans did not side with Democrats to convict him in his impeachment trial.
Mr Trump is actively holding meetings about launching his own social media network to rival Twitter, his senior media adviser, Jason Miller, said in an interview with Sky News and The Australian.
In the interview, Mr Miller said the risk of Mr Trump setting up his own political party was both “leverage” and “a reality”.
“(A third party) is not something he was proactively pursuing. There were no serious conversations that were being had behind the scenes, and the only way he was ever going to even think about that is if he was pushed towards it. But good thing is we have gotten past impeachment — President Trump has been acquitted fully.
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Report reveals devastating impact of Trump's health policies
Thursday, 18 February, 2021
A report published in The Lancet details the devastating impact of the Trump administration’s health policies, finding that 461,000 fewer Americans would have died in 2018 and 40% of US deaths during 2020 from COVID-19 would have been averted if the USA had death rates equivalent to those of the other G7 nations. The Lancet Commission on Public Policy and Health in the Trump Era also estimates that Trump’s rollbacks of environmental protections led to 22,000 excess deaths in 2019 alone.
The Commission finds that US life expectancy began trailing other high-income nations in about 1980 as President Ronald Reagan initiated anti-government, wealth-concentrating policies that reversed many of the advances of the New Deal and Civil Rights eras. Reagan’s political philosophy has continued to influence US health and economic policy under both Republican and Democratic administrations. Many Trump policies emulate Reagan’s, including tax cuts and deregulation that benefit the wealthy and corporations, austerity for the poor and privatisation of Medicare.
According to the report, a return to pre-Trump era policies is not enough to protect health. Sweeping reforms are needed to redress long-standing racism and the four decades of policy failures that weakened social and health safety nets and led to widened inequality.
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Washington is back, and so are London and Brussels
Asian nations discreetly hope for a more diverse balance of power in the Indo-Pacific region.
John McCarthy Contributor
Feb 22, 2021 – 1.17pm
President Joe Biden tells us that America is coming back to the region. Less noticed is that Europe is, too.
This is good news for Australia. For one thing, no country has more skilful external policy systems than Britain and France.
With French Polynesia still part of metropolitan France, the French never left the region, and in 2018 were the first European power to announce the genesis of a national Indo-Pacific strategy. Together with Germany and the Netherlands, they are the prime movers for a new European Union strategy on the Indo-Pacific, likely to be rolled out this year.
This enhanced European interest in the region is prompted by an appreciation that the central locus not only of global economic weight but also geopolitical activity has moved to the Indo-Pacific region, not an easy concept for Europeans to grasp.
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Embarrassing no-shows at China’s summit are a sign Europe is charting a new course
Peter Hartcher
Political and international editor
February 23, 2021 — 12.10am
Something went badly awry when China’s President Xi Jinping called together the leaders of 17 nations of central and eastern Europe this month. The event was the annual 17 + 1 summit – that’s 17 Europeans and one China. The one easily outweighs the 17 in its sheer economic bulk.
Not only is its economy seven times the size of all the European members put together, it also brings a sack of cash and promises of huge economic benefits each year. It’s Xi’s primary pathway for driving his colossal Belt and Road infrastructure juggernaut, also known as the “new silk road”, across Europe’s poor periphery and into its wealthy core.
The initiative “demonstrates that China has already become a fully fledged European power” said Emilian Kavalski, a professor of silk road studies at the University of Nottingham campus in Ningbo, China, in 2019.
And the Chinese Communist Party’s media has hailed the 17 + 1 as a “pioneering feat of great power diplomacy with Chinese characteristics”.
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Supreme Court paves way for prosecutors to seize Trump tax records
By Matthew Knott
February 23, 2021 — 3.07am
Washington: Former president Donald Trump has suffered a major legal defeat after the US Supreme Court declined his effort to block a New York grand jury from obtaining his personal and corporate tax records.
Prosecutors in New York City are investigating possible tax, insurance and bank fraud in Trump’s hotel and casino business empire.
The probe, led by Manhattan District Attorney Cy Vance, is believed to be one of the most serious legal threats Trump is facing in his post-presidential life.
The decision comes as Trump prepares to make his first public appearance since leaving the White House with an appearance at the Conservative Political Action Conference on Monday (AEDT).
“The work continues,” Vance said in a brief statement on Monday following the Supreme Court’s decision.
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China wants Biden to make the first move to thaw tensions. It could be a long wait
Stephen Bartholomeusz
Senior business columnist
February 23, 2021 — 11.58am
China is making it clear that it expects the Biden administration to make the first move to thaw a relationship frozen by Donald Trump’s trade and tech wars and sanctions for human rights abuses. That’s unlikely to happen.
China’s foreign minister, Wang Yi, on Monday (US time) urged the US to reopen a dialogue and distance itself from the Trump’s administration’s policies, calling on it to cease interfering in China’s internal affairs, abandon “irrational suppression” of China’s tech sector and remove its “unreasonable” sanctions.
The immediate US response wasn’t what Wang might have hoped for, with a US State Department spokesman saying his comments reflected a continued pattern of Beijing’s tendency to avert blame for its “predatory” economic practices, lack of transparency, failure to honour international agreements and its repression of universal human rights.
Neither US domestic politics nor realpolitik allows the new administration much flexibility in relation to China.
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Joe Biden leads ceremonies as US coronavirus deaths pass 500,000
Church bells chimed across Washington to mark one of the grimmest anniversaries in modern American history, as the death toll from the coronavirus topped 500,000 in the US.
The number, greater than the US death tolls in both World Wars and Vietnam combined, saw flags fly at half mast across the country as Joe Biden led a sombre ceremony to mark the tragic milestone.
At a ceremony held at the White House with 500 flickering candles representing those lost, Mr Biden described the toll as “truly grim” and “heartbreaking”.
“That’s more lives lost to this virus than any other nation on Earth,” he said. “But as we acknowledge the scale of this mass death in America, we remember each person and the life they lived.”
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https://www.afr.com/world/north-america/fed-s-powell-us-economic-recovery-is-uneven-20210224-p5758x
Fed’s Powell: US economic recovery is ‘uneven’
Christopher Rugaber
Feb 24, 2021 – 2.59am
Washington | Federal Reserve chairman Jerome Powell underscored the US economy’s ongoing weakness in remarks that suggested that the Fed sees no need to alter its ultra-low interest rate policies anytime soon.
“The economic recovery remains uneven and far from complete, and the path ahead is highly uncertain,” Powell said in written testimony to the Senate Banking Committee on Tuesday (Wednesday AEDT).
Powell’s comments are in contrast to the increasing optimism among many analysts that the economy will grow rapidly later this year. That outlook has also raised concerns, though, about a potential surge in inflation and has fuelled a sharp increase in longer-term interest rates this year.
Most economists say they think the Fed’s continued low rates, further government financial aid and progress in combating the viral pandemic could create a mini-economic boom as soon as this summer.
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Joe Biden’s $US1.9trn package is a risky experiment
If Biden could ignore political timing, it would make more sense to go for a smaller support package now and propose a huge medium-term investment program later on.
Martin Wolf Columnist
Feb 24, 2021 – 10.52am
How much fiscal stimulus is too much? The debate on this question among economists who support the goals of Joe Biden’s US administration has become fierce. That is no bad thing: policy should be debated. In this crisis, as during the 2008 financial crisis, one has to evaluate the risks of doing too little against those of doing too much.
But one thing is clear: the fact that too little stimulus was delivered in 2009 does not mean that far more than that must be right today. Policy must be judged by its suitability in current circumstances while recognising the uncertainties and balance of risks.
I have no objection in principle to huge fiscal spending. Indeed, in January 2009, I argued that the US should run a fiscal deficit of 10 per cent of gross domestic product until the damaged balance sheets of the private sector were healed. Shortly thereafter, I argued that we had to learn from Japan if we were to understand the dangers then confronting western economies. I have also recognised from the start that a pandemic is an emergency, rather like a war. Policy did indeed need to go on a war footing.
Nevertheless, it is vital to recognise what makes a pandemic different from a financial crisis or a war. Unlike a financial crisis, COVID-19 will not necessarily create an overhang of bad private debt likely to suppress demand indefinitely. Instead, the balance sheets of people who have earned well and spent little have actually improved. Again unlike a war, the pandemic does not destroy physical capital. There is a good chance therefore that economies will recover really strongly, once fear of the disease has waned. If so, the dominant part of the planned fiscal policy response should aim not so much at short-term relief as at “building back better”, by promoting a sustained increase in public and private investment.
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The Fed chief just disrupted the sharemarket’s ‘Great Rotation’
Stephen Bartholomeusz
Senior business columnist
February 24, 2021 — 11.59am
A second wave of the “Great Rotation” was disrupted by the cautious commentary of the US Federal Reserve Board chairman, Jerome Powell.
Over the past month or so, as the “reflation” trade gathered momentum, the tech stocks and those companies that benefited from the pandemic began losing ground while the banks and manufacturers that had been most adversely affected saw their share prices rise.
It was a reprise of a short-lived rotation late last year, away from tech and defensive stocks towards cyclicals – companies leveraged to economic growth - that petered out around the end of last year.
That trend re-emerged late last month and then accelerated last week with the big tech companies – the so-called “FAANG” stocks of Facebook, Apple, Google’s parent Alphabet and Netflix – shedding 4.2 per cent of their value.
The overall market was down about one per cent over that same period, but that could be attributed to the 28 per cent of the US market’s capitalisation now exposed to those big tech companies. The rest of the market was up modestly.
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Fed needs to ignore ‘taper tantrums’ and let longer rates rise
Short-term financial market volatility might cause some sleepless nights, but the Fed could unleash the lending capacity of the traditional banking system by letting the yield curve steepen further.
Richard Bernstein
Feb 25, 2021 – 10.36am
The Ferber Method, a sleep training technique, teaches babies to self-soothe and fall asleep on their own. It’s as much a training technique for new parents to ignore their baby’s crying as it is for the child to learn to cope by themself.
The US Federal Reserve should consider Ferberising bond investors and ignore future “taper tantrums” like the market disruption that occurred when the central bank signalled tighter monetary policy in 2013. The long-term health and competitiveness of the US economy may depend on bond investors’ self-soothing ability to cope with reality.
The slope of the yield curve is a simple model of the profitability of lending. Banks pay short-term rates on deposits and other sources of funds and receive longer-term rates by issuing mortgages, corporate loans, and other lending agreements.
A steeper curve, therefore, is a simple measure of better bank profit margins, and has in past cycles spurred greater willingness to lend. Historically, the Fed’s Survey of Senior Bank Lending Officers shows banks have been more willing to make loans to the real economy when the yield curve has been steeper.
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The Fed may need to head off a money-market mess
US policymakers should slightly lift the rates the Fed pays on bank reserves and on its borrowings in the repo market to help prevent other short-term rates from going negative.
Bill Dudley
Feb 26, 2021 – 6.49am
Investors are worried that a flood of cash could soon disrupt US money markets, as the Treasury rushes to rid itself of money that Congress won’t allow it to keep. It’s a possibility that the Federal Reserve would do well to anticipate.
Two phenomena have converged to create the impending deluge. For one, to ensure the funds needed to deliver trillions of dollars in pandemic relief, the Treasury has built up a huge cash balance at the Fed - currently about $US1.6 trillion ($2 trillion).
Also, back in August 2019, Congress suspended the federal debt ceiling for two years - and has stipulated that when the ceiling comes back into effect on August 1, Treasury should be holding no more than about $US120 billion in cash. This constraint was intended to prevent Treasury from preparing for the debt limit by accumulating an extraordinarily large cash balance.
So to meet the Congressional requirement, Treasury will have to draw down its cash balance at the Fed. Combined with the $US120 billion a month that the central bank is already spending to buy securities and keep long-term interest rates low, this will cause cash reserves that banks hold at the Fed to soar - likely topping $US5 trillion this summer, up from about $US3.4 trillion now.
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US Treasury yields surge, sounding alarm for risk assets
Vivien Lou Chen and Greg Ritchie
Feb 26, 2021 – 6.27am
Yields on US government debt blew past another set of closely watched levels, with a key part of the Treasury curve surging past an inflection point that’s seen as potentially squelching global speculative euphoria.
Yields took off with startling speed, with the rate on 10-year Treasuries reaching 1.61 per cent, the highest in a year.
In a telltale warning sign for some strategists, the 5-year Treasury yield soared convincingly above 0.75 per cent on Thursday (Friday AEDT), a crucial level that was expected to exacerbate selling, as traders pulled forward bets on when the Federal Reserve will start lifting policy rates.
The 10-year US real yield -- which strips out inflation and is seen as a pure read on growth prospects -- climbed as much as 25 basis points to a level last seen in June.
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Biden’s trade attack on China will reverberate around the world
Stephen Bartholomeusz
Senior business columnist
February 25, 2021 — 3.30pm
President Joe Biden’s ordering of a 100-day review of vulnerabilities in America’s supply chains highlights the dependence the US, and other developed economies, have on third-country suppliers, especially China, for products and technologies critical to their medical, industrial and defence sectors.
Biden’s initial review will cover computer chips, medical equipment, large capacity batteries and rare earths, with another 12-month review of other sectors including technology more broadly and food production.
The more urgent analysis, which comes amid a global shortage of the semiconductors critical to most modern manufacturing, from cars to smartphones to defence technologies, flows from a pandemic-inspired recognition of how concentrated, China-based and vulnerable most modern supply chains are and against the backdrop of the severe stresses in the relationship between the US and China.
Most developed countries, including Australia, found themselves scrambling for personal protective equipment and pharmaceuticals at the onset of the pandemic, taken aback at how dependent they had become on China, and are now assessing how to “re-shore” the most critical manufacturing capacities.
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‘It must end badly’: Buffett’s right-hand man says Wall Street is showing bubble signs
By Josh Funk
February 25, 2021 — 11.10am
Investor Warren Buffett’s right-hand man says the US stockmarket is overvalued, but he doesn’t know when the bubble will burst.
Billionaire Charlie Munger is a vice chairman at Buffett’s Berkshire Hathaway conglomerate. He typically sits alongside Buffett to field questions at Berkshire’s annual meetings in Omaha, Nebraska, each spring.
“I think it must end badly but I don’t know when,” Munger said of the stockmarket’s run to record levels. He fielded questions for two hours on Wednesday (US time) at the annual meeting of another company he is chairman of, the Daily Journal, which operates a small legal newspaper in California and sells software to court systems.
Munger said the recent frenzy over GameStop’s stock was driven by small investors gambling on the stock market.
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New York prosecutor obtains Trump’s tax records after long fight
By Michael R. Sisak
February 26, 2021 — 3.35am
New York: A New York prosecutor has obtained copies of Donald Trump’s tax records after the US Supreme Court this week rejected the former president’s last-ditch effort to prevent them from being handed over.
The Manhattan district attorney’s office enforced a subpoena on Trump’s accounting firm within hours of the Supreme Court’s ruling on Monday and now has the documents in hand, a spokesperson for the office, Danny Frost, said on Thursday (Friday AEDT).
District Attorney Cyrus R. Vance jnr had been fighting for a year and a half for access to Trump’s tax records for a criminal grand jury investigation into his business dealings. The documents are protected by grand jury secrecy rules and are not expected to be made public.
Vance, a Democrat, is conducting a wide-ranging investigation that includes an examination of whether Trump or his businesses lied about the value of assets to gain favourable loan terms and tax benefits. The district attorney is also scrutinising hush-money payments paid to women on Trump’s behalf.
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US strikes Iranian-backed militia facilities in Syria
Idrees Ali and Phil Stewart
Feb 26, 2021 – 12.27pm
Washington | US President Joe Biden on Thursday (Friday AEST) directed US military airstrikes in eastern Syria against facilities belonging to what the Pentagon said were Iran-backed militia, in a calibrated response to recent rocket attacks against US targets in Iraq.
The strikes appeared to be limited in scope, potentially lowering the risk of escalation.
Mr Biden’s decision to strike only in Syria and not in Iraq, at least for now, also gives the Iraqi government some breathing room as it carries out its own investigation of a February 15 attack that wounded Americans.
“At President Biden’s direction, US military forces earlier this evening conducted airstrikes against infrastructure utilised by Iranian-backed militant groups in eastern Syria,” Pentagon spokesman John Kirby said in a statement.
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Peril and Opportunity for Trump at CPAC
· The Wall Street Journal
It’s going be yuge, as Donald Trump might say. Mr Trump’s speech Sunday at the Conservative Political Action Conference in Orlando, Florida, will be his first public appearance since his calamitous January 6 address that led to a violent mob assaulting the Capitol.
This weekend, Mr Trump will again stir the political waters, as he’s done in past CPAC appearances. At his first, in February 2011, he announced he was “thinking about” a White House bid because America had “become a whipping post for the rest of the world.” He had “participated in many battles” and “really almost come out very, very victorious every single time,” having “beaten many people and companies” and “intelligently earned many billions of dollars, which in a sense was both a scorecard and acknowledgment of my abilities.” He spontaneously called Rep. Ron Paul, winner of that year’s CPAC presidential straw poll, a loser with “zero chance of getting elected.” Sound familiar?
Mr Trump didn’t run in 2012, but many themes of his 2016 campaign were there in his 2011 remarks: defeating China, ending dependence on the Organisation of the Petroleum Exporting Countries, and promises to “blast” an American enemy — Somali pirates in that case — “so fast.”
Donald Trump will make his first public appearance since leaving office after agreeing to speak at the Conservative Political Action Conference (CPAC) in Orlando, Florida this week.
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I look forward to comments on all this!
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David.
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