March 31 2022 Edition
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Pres. Biden has spent a good few days last week in Europe as the Russian war in Ukraine rages on. The suffering is totally appalling and we need this to stop ASAP…the only question is how.
In the UK we see BoJo much more secure because of the war complicated by huge rises in cost of living. The rises in costs for ordinary citizens and really alarming.
In OZ we will know what the Budget contains and when the Federal election will be real soon now!
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Major Issues.
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https://www.afr.com/policy/foreign-affairs/pm-s-cold-war-rhetoric-is-premature-20220317-p5a5gq
Is the PM’s cold war rhetoric premature?
Scott Morrison’s Americanisation of Australian foreign policy is troubling considering the high economic costs of imposing sanctions on China should it give aid to Russia over Ukraine.
James Curran Columnist
Mar 20, 2022 – 12.16pm
As the Russian invasion of Ukraine moves into a bloodier phase, attempts to divine its meaning for the future intensify.
Instant myths are being created out of the emotion of the moment. And masks are being peeled away.
We are told by some that a new world is being born. By others that freedom is fading into the twilight. Platoons of experts, at ease in their self-made war cabinet rooms, push military escalation with blithe indifference to the horrible consequences that may follow.
Prime Minister Scott Morrison, in his latest trawl through the back catalogue of American neo-conservative rhetoric – the very talk which gave us the Iraq war – already has his slogan: the “arc of autocracy”.
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Marshall’s election defeat a concern for Morrison, and premiers
March 19, 2022 — 9.31pm
Make no mistake.
When the ABC’s Antony Green called the election for Labor’s Peter Malinauskas at 8.07pm SA time – signalling the defeat of Steven Marshall’s first term Liberal government – incumbent governments across the country took a deep breath.
Just two hours after polling booths closed Mr Marshall, who had been governing in minority after three MPs had to move to the crossbench following the 2018 election, the government is headed to the opposition benches.
Mr Marshall is the first incumbent in Australia to lose an election since COVID-19 arrived on our shores. That matters. Yes, Donald Trump lost the presidential election and other leaders around the world have done so too, but this result could signal the script has been flipped in Australia.
Yes, Australians still want certainty in uncertain times. And yes, Mr Marshall was in a precarious position.
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https://www.afr.com/markets/equity-markets/are-we-really-heading-for-stagflation-20220318-p5a5yr
Are we really heading for stagflation?
Australia is not susceptible to this dangerous growth-inflation mix: financial conditions are desirable, reporting season was one of the best on record, and balance sheets are robust, writes Jun Bei Liu.
Jun Bei Liu Contributor
Mar 20, 2022 – 5.00am
The conversation around equity markets has shifted recently, from fear of rapid interest rate rises, to the conflict in Ukraine and its impact on inflation and growth. As a result, stagflation is now back on investors’ minds.
Stagflation refers to an unusual period of high inflation with low, or in extreme circumstances, negative economic growth. Many investors have never experienced such an environment. The most recent stagflation experience was back in the 1970s, where inflation rose to as much as 12 per cent, mostly caused by the oil price spike.
As the name suggests, stagflation would be a very uncomfortable period for households and corporates as real income shrinks and begins to drive demand destruction.
Once this spiral of rising inflation, falling real incomes and weakening demand becomes entrenched, the economy goes into a negative spiral that is hard to reverse. As early as the start of the year, this seemed liked an unthinkable scenario for the global economy and/or Australia, but a lot has changed.
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https://thenewdaily.com.au/finance/finance-news/2022/03/21/china-crossroads-australia-alan-kohler/
6:00am, Mar 21, 2022 Updated: 11:17pm, Mar 20
Alan Kohler: China is at a crossroads, which means Australia is too
It looks like Australia will finally have to confront the problem of trading with a repugnant dictatorship, unless China dumps its “no limits” partnership with Russia.
If Putin prevails in Ukraine by murdering and/or subduing its population, or even if he doesn’t, and China continues to be Russia’s ally, then the Australian government and the companies that trade with China will have a very difficult problem.
As Peter Hartcher eloquently put in his book Red Zone: “Australia did not want to confront reality. It was too deeply committed to the dream, to the opioid temptation of effortless, limitless profit, to the lotus flower of China’s allure.”
That reality will now have to be confronted.
At this stage, Prime Minister Scott Morrison is leaning into it, declaring in a speech on March 7 that “a new arc of autocracy is instinctively aligning to challenge and reset the world order in their own image”.
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https://www.roymorgan.com/findings/8917-federal-voting-intention-mid-march-2022-202203160002
The ALP continues to hold a commanding lead over the L-NP as the Russia-Ukraine war continues and petrol prices spike: ALP 56% cf. L-NP 44%
March 16 2022
Finding No. 8917
A special Roy Morgan Poll conducted over the last week shows there is little change to the Federal voting intention in Australia with the ALP 56% (down 0.5% points from a week ago) still well ahead of the L-NP 44% (up 0.5% points) on a two-party preferred basis.
The latest Roy Morgan Poll was conducted as the Russian war on Ukraine enters its third week and the increase in energy prices caused by the war has now led to significant increases in petrol prices around Australia to record highs above $2 per litre.
Analysis by State shows small movements with support for the L-NP up slightly in Victoria, Queensland and Tasmania while support for the ALP increased in NSW, Western Australia and South Australia.
This Roy Morgan Poll on Federal voting intention and Government Confidence was conducted via telephone and online interviewing of 1,947 Australian electors aged 18+ from Thursday March 3 - Sunday March 13, 2022. There were 5.5% of electors (down 1% point) who wouldn’t say who they support.
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How to manage an equities portfolio through geopolitical tension
Giselle Roux Contributor
Mar 21, 2022 – 5.00am
Only a few months ago investors were focused on a relatively predictable set of US Federal Reserve interest rates rises as COVID-19 restrictions were progressively lifted. The unbottling of sticky supply chains and robust employment gave license for consumers to spend.
Much of this has been upended by the invasion of Ukraine, which has exposed the fragility of the presumed economic recovery. China’s long-standing impact on global growth looks less certain, the energy transition is expensive and corporate profits buoyed by low wage growth or flexible supply arrangements are under pressure.
A reminder how quickly things change.
Without labouring the mounting issues, the question for investors is what to do now. There are a few pointers to reflect on across an equity portfolio.
To paraphrase the Madness of Crowds, we tend to rapidly rush into themes but take more time to let go when they’re not what they appear to be.
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Call to slap health sector-style rules on ‘finfluencers’
Aleks Vickovich Wealth editor
Mar 20, 2022 – 7.00pm
Trending posts on social media platforms Reddit and TikTok are among the top priorities of young investors, says research released amid renewed calls for regulation of unlicensed financial advice online.
A survey, conducted by The Digital Edge Research Company and commissioned by foreign exchange broker Global Prime, has confirmed the regulator’s fears that social media has a growing influence over the decisions of retail investors.
Of the 1005 Australian adults surveyed, 73 (7.3 per cent) chose “what’s trending on social media or the internet” as one of their three biggest priorities when choosing which stocks or assets to invest in. The survey listed Reddit, TikTok, Discord and 4chan as relevant social media.
Twenty individuals (2 per cent) picked the option as their number one priority, above the costs and risks associated with that investment or advice of a professional investment adviser, family and friends.
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Newspoll ‘science’ predicts SA swing, Premier Marshall’s defeat
6:46PM March 20, 2022
The Weekend Australian’s exclusive Newspoll published on Saturday correctly picked the statewide swing against Stephen Marshall’s Liberal government, which swept it from power after only one term.
With just over half of the vote counted, Labor’s statewide swing of 5.6 per cent on a two-party preferred basis compared with the Newspoll’s prediction of a 5.9 per cent swing against the government.
This adds to Newspoll’s successful prediction of a landslide for WA Premier Mark McGowan in March last year. Newspoll predicted a 66-34 two party preferred result in the election compared with the final 69.7-30.3 per cent result.
In the October 2020 Queensland election, Newspoll picked the return of Annastacia Palaszczuk’s government, predicting a 51.5 per cent to 48.5 per cent result compared with the final 53.2-46.8 per cent result.
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The top four Australian universities for producing CEOs
Agnes King and Julie Hare
Mar 20, 2022 – 11.40am
The paths to becoming a chief executive are many. But Elizabeth Gaines’ accension to the top of Fortescue, or Matt Comyn’s to the plum role at the Commonwealth Bank could be as much a function of nurture as it is nature, according to new analysis.
Preply, an online learning provider, dug into the education backgrounds of CEOs on the Forbes list of 1000 top global companies to see which universities have a track record of developing strong leadership.
“It’s clear that there are some universities with the right ingredients to create successful CEOs,” Preply student success manager Amy Pritchett said.
Preply identified the University of NSW, Australian National University, Macquarie University and the University of South Australia as the top four institutions for producing CEOs in Australia.
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the name of democratic choice of its own destiny that has remade history.
https://www.afr.com/politics/federal/pm-faces-most-pessimistic-voters-in-30-years-20220322-p5a6qh
PM faces most pessimistic voters in 30 years
Ronald Mizen Economics correspondent
Mar 22, 2022 – 6.24pm
Unless next week’s federal budget bolsters the nation’s confidence, Prime Minister Scott Morrison will head into the election campaign with voters at their most pessimistic before a national poll in 30 years.
Consumer confidence last week plunged 4.8 per cent to levels last seen during the COVID-19 lockdowns in 2020, and prior to that the global financial crisis between 2008 and 2009.
Despite the booming economy, cost of living pressures pushed confidence index to 91.2 points, well below the long run average of 111.5 points and the lowest pre-poll level since 1990, according to ANZ and Roy Morgan,
But that won’t necessarily help Labor leader Anthony Albanese, according to social researcher Rebecca Huntley, who undertakes extensive polling in marginal electorates.
“It could go either way,” Dr Huntley told The Australian Financial Review. “It could fuel the kind of huge change we saw in South Australia, or it could assist the incumbent government, even where people don’t like the leader.”
Dr Huntley said the key would be who could best harness the discontent.
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Loyal Labor lieutenant? Why Kimberley Kitching had trust issues
Award-winning political commentator and author
Updated March 24, 2022 — 9.10amfirst published at 5.00am
Scott Morrison is kidding himself if he thinks the South Australian election was decided only on state issues, that his standing had no bearing on the vote, and that what happened last weekend can’t be replicated federally.
The Morrison factor was definitely there, and it was big enough to unsettle even more Liberals about their prospects with him at the helm. The result has increased the muttering about regime change.
“He is definitely on the nose here,” one South Australian Liberal said, adding Morrison was a drag on their ticket. Sure Steven Marshall was up against an articulate, charismatic young leader who ran a clever campaign. It still doesn’t explain the extent of the swings in Liberal seats, an omen perhaps for inner urban federal Liberals under threat from independents or Labor.
It’s no good Morrison saying Anthony Albanese is no Mark McGowan and no Peter Malinauskas. Nor is he.
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Students look elsewhere for ‘quality’ education
Julie Hare Education editor
Mar 24, 2022 – 3.56pm
Two years of closed borders have immeasurably damaged Australia’s reputation among international students, with new research showing perceptions about educational quality and value for money have fallen compared to key competitor nations.
Canada has consolidated its spot as the most in-demand destination with one in four students putting it at the top of their list.
Research commissioned by IDP canvassed the views of more than 10,000 students and found students prioritise return on investment and quality of education.
The Emerging Futures study shows that while Australia ranked highly on two key categories – visas for post-graduation work rights and student welfare – it was perceived poorly on educational quality, value for money and the ability to get meaningful employment, not just the visa that gives them the right to it.
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https://www.afr.com/world/asia/china-confirms-policing-deal-with-solomons-20220325-p5a7ut
China confirms ‘policing’ deal with Solomons
Michael Smith North Asia correspondent
Mar 25, 2022 – 10.18am
Tokyo | China has confirmed it signed a policing and law enforcement agreement with the Solomon Islands but has not said whether this is part of a broader security arrangement which could give it a military presence.
Wang Xiaohong, a senior official from China’s Public Security bureau held a video meeting with Solomon Islands Police Minister Anthony Veka last week to sign a memorandum of understanding on “police cooperation”, Chinese authorities confirmed.
China said it wanted to work with the Solomon Islands to promote cooperation in “police affairs and law enforcement”, a statement posted online by the Chinese Embassy in the Solomon Islands said.
There was no mention of talks about a broader security agreement covering the military, but China said it wanted to push the strategic relationship to a “higher level”.
The Australian government expressed alarm about a draft security agreement between Beijing and the Solomon Islands circulating online on Thursday which is feared would pave the way for a Chinese military presence on the Pacific Island nation.
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Why this was Australia’s most significant corporate collapse
The $5.3 billion HIH implosion wiped out more than many high-profile reputations. It cut a swath through the insurance industry, and overhauled the regulatory regime.
Andrew Clark Senior writer
Mar 25, 2022 – 5.00am
The $5.3 billion collapse of HIH in March 2001 was the biggest and most significant in Australian corporate history. This was not just because of its size, but its impact on business, insurance, consumers and regulation.
Much of the media coverage of HIH’s implosion zeroed in on the role of HIH founder Ray Williams, who was later jailed; former prime minister Malcolm Turnbull, who advised the ailing FAI on its sale to HIH; and former FAI chief executive Rodney Adler.
But the lasting damage was elsewhere. HIH’s collapse left thousands of builders without insurance cover, and almost $2 billion of construction activity was placed on hold, according to a Treasury report.
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Support for Scott Morrison among key voters drops as Anthony Albanese gains ground in polls
New polling analysis has revealed which crucial groups of voters could abandon Scott Morrison at the next federal election.
March 25, 2022 - 8:09AM NCA NewsWire
Voters who gifted Scott Morrison his ‘miracle’ election win have turned their backs on the Prime Minister, a new poll has revealed.
In a sign cost of living will be front and centre during the election campaign, fresh analysis of The Australian’s Newspoll indicates support for the Coalition and Mr Morrison among working families has dropped.
Over the past three months, the Coalition has suffered a seven point fall among 35 to 49-year olds, with only 29 per cent now supporting the Liberals or Nationals.
Meanwhile, Labor has experienced a five point lift in support to 44 per cent in that demographic.
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Australia can’t defend itself but that’s about to change
Revolutionary stealth bombers and nuclear-powered submarines could change the game, writes Christopher Joye.
Christopher Joye Columnist
Mar 25, 2022 – 1.06pm
It’s curiously un-Australian to be woefully unprepared for a fight. But that is the situation we find ourselves in. And it is the crisis that our current and future leaders must expeditiously address. On the precipice of what America’s president says could be World War III, Australia has no ability to independently defend itself. We are pitifully weak, reliant exclusively on the munificence of our big brother. But radical change is afoot.
In 2012, the year that President Xi Jinping was elected China’s paramount leader, Australia’s government allowed our defence spending to shrink to 1.6 per cent of GDP, its lowest level since the 1930s. That same year, our government published the Asian century white paper, which imagined a prosperous future perpetually intertwined with China’s ineluctable rise.
On Friday morning Australians woke to the shocking news that China has drafted a secret deal to build a military base in the Solomon Islands, merely a three-hour flight from Brisbane. Beyond the range of any current Australian missiles or aircraft, but well within the reach of China’s vast and nuclear-able strike capability.
This is a nation that has warned that it will not hesitate to target Australian bases with ballistic missiles in the event we fulfil our defence obligations to the United States in a China-Taiwan conflict. This is also a nation that has in recent years sought to (unsuccessfully) crush Australia into economic and political submission through brutal coercion via a one-sided trade war simply because our prime minister dared speak out about the need to investigate the origins of COVID-19.
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Australia’s great diplomatic test with India
Drawing New Delhi from its Cold War bond with a self-destructive Russia will be a big foreign policy opportunity – and challenge – for the next few decades.
Rory Medcalf Geopolitical analyst
Mar 25, 2022 – 11.22am
This is a strange kind of national security election – marked by furious consensus that business as usual will not save Australia from rising international risks.
Russia’s invasion of Ukraine flounders horrifically on. In Australia’s Indo-Pacific region, China’s neo-colonial bid for dominance intensifies, underscored by its extraordinary deal to place armed forces in the Solomon Islands.
On the eve of the election campaign proper, the government is marshalling serried security announcements.
And both major parties are accentuating the diplomacy the nation will need to navigate this new era of indefinite crisis, where brute power is again centre stage in the international system.
Diplomacy featured prominently in the contending speeches earlier this month by Prime Minister Scott Morrison and Opposition Leader Anthony Albanese.
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Morrison overtaken by the lapping tide of events
Belittling climate change in the Pacific might come back and bite you when China is countering our new nuclear submarines with its own island bases.
Laura Tingle Columnist
Mar 25, 2022 – 5.09pm
It was September 2015 and the then immigration minister, Peter Dutton, was waiting with prime minister Tony Abbott and social services minister Scott Morrison for a meeting to start at Parliament House.
With the television cameras rolling, the three engaged in some “light-hearted” sotto voce banter about the late arrival of some of the attendees.
Dutton, apparently referring to Indigenous punctuality in north Queensland, remarked to his colleagues, “It’s Cape York time.”
Abbott laughed and said something similar had occurred at a Pacific Islands Forum meeting the previous day in Papua New Guinea.
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Security money must match our political posturing
Political and international editor
March 26, 2022 — 5.00am
The Morrison government’s favoured election policy themes will be the showpieces of next week’s federal budget. They are twofold. The Coalition claims to be the better party to build a stronger economy. And to strengthen national security.
But the two are not separate. A nation’s economic strength is the essential feedstock for its military power. It’s not the only element. It is an indispensable one, however: “States survive by waging wars, and wars are expensive,” point out the American scholars Emily Goldman and Leo Blanken.
One especially topical example. Before the US agreed to last year’s AUKUS arrangement to help Australia acquire nuclear-powered submarines, the Biden administration took a hard look at whether Australia could afford them in the years to come. The US didn’t want to entangle itself in any future Australian budgetary disaster. So judging whether to trust Australia with the so-called crown jewels of US military advantage demanded a judgment on whether to trust Australia to be able to pay for them. Crown jewels are expensive.
Recollecting the internal debate, an administration official told me: “This will be very expensive for Australia, perhaps more expensive than the French subs it will be replacing and there will be maintenance costs for decades.”
Australia, NZ warn Solomons over ‘destabilising’ the Pacific with China deal
By Eryk Bagshaw and Farrah Tomazin
Updated March 25, 2022 — 4.37pmfirst published at 3.53pm
Singapore/Washington: Australia and New Zealand will push to stop a security agreement between China and the Solomon Islands from being signed as officials scramble to understand how they were blindsided by Beijing’s proposed deal.
There is deep concern in Canberra, Wellington and Washington about the implications of a potential base for Chinese naval vessels right on Australia’s doorstep that will be able to cut off key supply lines into Asia and the Pacific in the event of a conflict.
The Solomon Islands Office of Prime Minister and Cabinet on Friday afternoon said it was working with China to create a secure and safe environment for local and foreign investment while deepening its relations with Beijing and other governments.
“The government is expanding the country’s security arrangements with more countries,” it said in a statement. “Broadening partnerships is needed to improve the quality of lives of our people and address soft and hard security threats facing the country.”
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Shock China security deal shows Pacific powers need to face facts
Specialist on Chinese domestic and foreign policy
March 26, 2022 — 5.00am
Yesterday the alarming news broke that the Solomon Islands is planning to sign a security agreement with the People’s Republic of China, opening the way for a permanent military base and intelligence listening posts. The new agreement has implications for the security of the whole of the Pacific.
If a hostile power controls a base on the Solomons, they could block shipping traffic from the Pacific into the Indian Ocean, into the Coral Sea, and beyond. Under the agreement, China will send military personnel, intelligence and information support, police, and other armed personnel upon the request of the Solomons government.
The Solomon Islands government will be required to provide legal status and judiciary immunity for the mission. The agreement will be valid for five years, automatically renewed.
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Not too late, but Australia must reach out to Solomon Islands now
9:48PM March 25, 2022
Beijing’s interest in Pacific military bases is to make it harder for the US to move forces across the sea and closer to the Chinese mainland.
This is a modern version of Japan’s wartime strategy: protect the homeland by dispersing your own forces and hit the enemy’s supply lines as they try to get closer.
A bonus for China is that a military base in the Solomon Islands would complicate Australia’s defence.
The battle of the Coral Sea in 1942 is remembered as the first major fight between aircraft carriers, but it was fought in an unsuccessful attempt to stop Japanese forces lodging in the Solomon Islands.
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US-Australia economic pact to fight China sanctions
9:34PM March 25, 2022
Australia and the US will elevate economic coercion by China in the Indo-Pacific to a third pillar of the strategic partnership alongside defence and foreign affairs, with formal talks to begin next week in Washington DC on the growing threat to the region.
The move to draw the economic weight of the US directly into Australia’s strategic sphere to counter China’s economic presence follows a similar agreement signed between the US and Japan last month.
The announcement of a formal strategic economic dialogue between Canberra and Washington, which is likely to provoke further condemnation from Beijing, will lead to greater US economic investment in the region.
Under the pact, the US and Australia would work collectively with other countries to push back against Chinese coercion and co-operate more closely on the impacts of sanctions including trade diversion.
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Austrac blind to Star’s breaches: watchdog’s audit missed evidence of impropriety
9:09PM March 25, 2022
The nation’s financial intelligence agency conducted an extensive compliance audit of Star Entertainment’s Sydney casino while officials were engaging in illegal gambling transactions but failed to uncover the impropriety, issuing findings that the gaming company’s anti-money laundering procedures remained robust.
Confidential correspondence between Austrac and The Star – obtained by The Weekend Australian – reveal its months-long review of the casino operation beginning in April 2017 included a focus on its anti-money laundering program and its relationship with junket operators.
The review saw Austrac officials conduct a two-day onsite inspection of the casino that concluded by largely praising its anti-money laundering and counter-terrorism financing program and labelling it “strong”.
Positive feedback was also provided for Star’s “risk-awareness training provided to staff”, with the only criticism relating to the “ambiguity of language” in some aspects of its policies.
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COVID 19 Information
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NSW records 19,843 new COVID cases, as millions become eligible for fourth vaccine jab
By Lucy Carroll, Jordan Baker and Sally Rawsthorne
Updated March 26, 2022 — 11.01amfirst published March 25, 2022 — 4.31pm
NSW recorded new 19,843 cases of COVID-19 and four deaths, as the nation prepares to scrap some of the last remaining pandemic restrictions on international travel.
Almost 3300 health workers are off work sick or isolating due to COVID-19, with almost 1200 NSW residents hospitalised with the virus. Of those, 44 are in intensive care.
From April 17, international travellers will no longer need to show a negative COVID-19 test before flying into Australia and a two-year ban on cruise vessels entering the country will be lifted.
International arrivals will still need to provide proof of double vaccination against COVID-19.
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Climate Change.
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Scientists stunned by ‘unthinkable’ temperature surge in Arctic, Antarctica
There has been an “unthinkable” simultaneous surge in temperatures in the Arctic and Antarctic, stunning scientists around the world.
March 21, 2022 - 10:16AM
An alarming heatwave is taking place simultaneously in the Arctic and Antarctic – a development described as “unthinkable” by scientists.
Records have been shattered in parts of Antarctica, with the temperature more than 40C warmer than average. Meanwhile in parts of the Arctic, the mercury shot up more than 30C higher than normal.
On March 19 the Concordia weather station in Antarctica was at -12.2C, about 40C above average, climatologist Maximiliano Herrera reported.
The heatwave has stunned scientists.
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https://www.smh.com.au/interactive/2022/climate-in-your-region/index.html
How heat became the 'silent killer' stalking Australia
For all its new extremes, the weather we are experiencing is likely to be the most benign we will ever see. This is how climate change will affect where you live.
by Pallavi Singhal, Nick OMalley and Daniel Carter
March 25, 2022
While the summer has ended with millions of Australians sheltering from relentless rain, many others sweltered in record temperatures. Australia’s hottest ever temperature – 50.7 degrees – was recorded in Onslow in Western Australia on January 12 and Perth endured a record 13 days above 40 degrees, six of which were consecutive.
The intensifying heat hitting Australia is in keeping with the predictions of the latest UN climate report, which confirmed that Australia had already warmed faster than other parts of the world and that the frequency of heatwaves will increase 85 per cent with warming of 1.5 and 2 degrees.
What is less well-known is that heat already kills far more Australians than all other extreme weather events combined. The death toll is only set to grow.
Temperatures
across Australia have increased by between 0.2 and 1.6 degrees on average over
the past 21 years, according to the latest NASA data.
Keep scrolling for an interactive map that will let you explore the full
changes and projections data.
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‘Disappointing’: Carbon offsets’ integrity under attack
Lucy Dean Wealth reporter
Updated Mar 25, 2022 – 4.18pm, first published at 4.14pm
Claims the Australian Carbon Credit Unit market has been flooded with “flawed” products are disappointing but not surprising, carbon market participants have said, expressing hope the exposure will trigger a mass clean-up of the sector.
The former head of the Emissions Reduction Assurance Committee, Andrew Macintosh, on Wednesday said as many as 80 per cent of carbon credits issued by the Australian Clean Energy Regulator were tied to flawed projects that will not remove as much carbon from the environment as promised.
They include Australian Carbon Credit Units (ACCUs) for planting trees that were already there, for promising not to clear forests that were never under threat and for attempting to grow trees in areas where they could not be sustained, Professor Macintosh told the Australian Financial Review.
Although disappointing, Professor Macintosh’s claims were unsurprising, said Carbon Asset Solutions director Ian Jones.
The soil-carbon measurement business has not opted into the ACCU scheme.
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Royal Commissions And The Like.
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No entries in this category.
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National Budget Issues.
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https://www.afr.com/politics/federal/australia-facing-15-years-of-budget-deficits-20220319-p5a66c
Australia facing 15 years of budget deficits
Ronald Mizen Economics correspondent
Mar 21, 2022 – 5.00am
The strength of the post-pandemic economic recovery will bring a $30 billion improvement to the budget bottom line this year, but whoever wins the federal election in May will face 15 years of deficits and the need to find savings of $40 billion a year in the next few years.
The surge in global commodity prices including iron ore, coal and gas will add about $45 billion in additional revenue, supporting an $87.6 billion improvement over the four-year forward estimates.
The budget will still contain cumulative deficits of more than $250 billion and spending at a historically high 26 per cent of GDP, according to Deloitte budget economist Chris Richardson, and that is before likely new spending on defence, aged care and the National Disability Insurance Scheme.
“We’re in a budgetary hole, so let’s stop digging,” Mr Richardson said in Deloitte Access Economics’ latest budget monitor, adding it was time to “rebuild our defences” to prepare for future crises.
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Aiming for budget surplus is the ‘wrong target’, says Reserve Bank of Australia governor Philip Lowe
1:33AM March 23, 2022
And into the lion’s den he went.
Reserve Bank governor Philip Lowe spent 47 minutes taking questions from the Sydney media pack at the Walkley lunch on Tuesday. It is likely to be his last unscripted outing until after the election.
There is danger for any central banker out and about during an election campaign when fiscal stimulus and monetary policy is hotly debated.
In a seven-minute speech, the governor would not be talking about monetary policy. However, he was prepared to take questions on monetary policy.
Given the choice what journalist would not prefer a cosy unscripted Q&A to a set speech?
Much ground was covered: the governor’s view on a shift in inflation psychology out in the market, unpacked by my colleague Eric Johnston; the need to charter a decline in the debt-to-GDP ratio, so much more effective than trying to charter a return to budget surplus; and the idea that miscreant governments that fear freezing of their assets by Western countries could increase demand for gold and cryptocurrencies.
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Federal budget 2022: Australia to launch National Convicted Terrorist Offender Register
Australia has launched a new terrorism strategy, warning the threat has “evolved” as large crowds start to gather again post Covid.
March 24, 2022 - 12:13PM
NCA NewsWire
A national offenders register will be created to monitor convicted terrorists once they’ve left jail as part of a $86.7m funding commitment in next week’s federal budget which will support a new counter terrorism strategy in Australia.
Home Affairs Minister Karen Andrews will on Thursday warn the threat of terrorism has “evolved” as people again start to gather in large crowds post Covid-19.
She will announce the new strategy while also revealing $66.9m in the upcoming budget will go towards implementing new powers passed in parliament last year that allow courts to impose strict rules and reporting obligations on convicted terrorists who finish their maximum jail term and are still deemed a high risk.
Another $19.8m will be invested into creating a National Convicted Terrorist Offender Register that will focus on more long-term monitoring of the criminals who can’t be deradicalised.
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https://www.afr.com/politics/federal/pm-woos-grey-vote-with-budget-handouts-20220325-p5a7u3
PM woos grey vote with budget handouts
Phillip Coorey and Ronald Mizen
Mar 25, 2022 – 10.30pm
More than 1 million self-funded retirees will be given extended relief on their superannuation savings, and pensioners could be included in a one-off, $250 bonus scheme to assist with the cost of living, as the Morrison government seeks to shore up the grey vote in next week’s federal budget.
The budget, to be used as a springboard for a federal election to be called shortly after, will extend for another 12 months the halving of the superannuation drawdown rate for self-funded retirees.
The cash payments, which the government would not confirm or deny would be extended to pensioners, will be in people’s accounts before they vote at the election, expected on either May 14 or 21.
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Frydenberg would be foolish to expect anything but the worst
Columnist
March 26, 2022 — 5.00am
It’s not quite an iron law of economics, but close to it. International conflict is good for Australian exporters, and by extension the federal budget in an election year. But it is a mirage of the mining cycle that will destroy any government that takes the boom for granted.
Josh Frydenberg and his advisers in Treasury would have pondered this ironic fact as they calculated the multiple shocks to the bottom line – both positive and negative – from Russia’s invasion of Ukraine.
The deficit is falling faster than they hoped for, thanks to a surge in commodity prices. But the revenue windfall will not be sufficient of itself to remove the domestic sting of inflation and higher interest rates.
The history the Treasurer should be aware of is that the improvement in the bottom line may perversely signal the end of Australia’s economic free ride in the 21st century. Booms that lift our national income in times of global crisis invariably end in tears, even if the government of the day can squeeze out an extra election win before the reckoning. This boom comes with a further degree of danger because our main export customer happens to be an ally of the despot who started the war.
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Debt reality bites: Budget interest will keep on climbing
By Shane Wright
March 25, 2022 — 6.00pm
Every new treasurer uses their first budget to promise an assault on debt and deficit.
It’s a rite of passage to decry their predecessor, ignore any troubles they faced, and paint a picture of fiscal nirvana.
In 1996, Peter Costello said the previous government had left Australia on “a path of deficit and debt to the next century”.
Wayne Swan used his first budget to argue the country needed a “strong surplus to anchor a strong economy (and) to do our bit to ease inflationary pressures in the economy”.
Six years later, Joe Hockey warned debt was on its way to $667 billion. “The days of borrow and spend must come to an end,” he proclaimed.
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Health Issues.
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https://www.nabtrade.com.au/investor/insights/latest-news/news/2022/03/six_healthcare_stock
Six healthcare stocks that could improve your portfolio's health
10 March 2022 09:30 AM Stock ideas
Historically, the healthcare sector collection of stocks has been full of absolute winners but ironically the worst global health crisis ever has actually been bad for stock prices of some of our best healthcare companies. Why? Well, the business of beating the Coronavirus has meant governments have undermined the format upon which these companies have grown their brand, profits and share prices.
The chart below of one of best companies and one of the best healthcare companies in the world i.e. CSL, graphically portrays my point.
Note how the share price has gone up and down on a sideways trend, which reflects the shock developments of the first Covid-19 closure of the world economy, followed by the Delta strain and then the arrival Omicron.
The expectation is that CSL and other businesses will see their bottom lines and share prices improve as normalcy returns over time and so these healthcare stocks look attractive to the patient long-term investor. Anyone wanting short-term ‘buy and flip’ profits might be disappointed but I expect some healthier returns from these businesses by year’s end, provided the Ukraine war doesn’t give markets a new unplayable curve ball, in the short term.
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The mental health of young people is almost visibly unravelling
Clinical psychologist
March 22, 2022 — 5.00am
For youth, the enduring risk to their wellbeing during the pandemic has been managing their mental health. Significant increases in suicidal thoughts, self-harm, anxiety, depression and eating disorders are all alarmingly consistent themes when you look at the toll the pandemic is taking on our young people. The Sydney Morning Herald and The Age highlighted the issue locally on Monday and reinforced what leading international research has also found.
In mid-2021 the Journal of the American Medical Association published research charting the impact of the pandemic on the health of young people. It showed that even in the first year of the pandemic one in four young people worldwide were experiencing clinically elevated depression symptoms, while one in five were experiencing elevated anxiety symptoms.
Alarmingly, the research concluded elevated mental health concerns were double pre-pandemic estimates and increasing over time. We know young people were already under immense mental health distress before the pandemic began and now, as we stretch into the third year of our COVID-19 existence, we see their psychological welfare almost visibly unravelling.
Young people are designed to be active, social beings – separating from their families, bonding with their peers and exploring the world. Nature calls them to take risks, gather with others their own age and embrace life. Living should be full of firsts for young people and the chance to stake claims to new independence with travel, jobs and friendships.
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IVF kids ‘face a superior quality of life’
11:00PM March 22, 2022
Researchers have found that children born through in vitro fertilisation may have a better quality of life on average than those who were naturally conceived.
The research from Monash University found that being born via assisted reproductive technology (ART), such as IVF, may lead people to have a higher quality of life in adulthood.
The study led by Monash’s Karin Hammarberg, enlisted 193 people in Victoria who were conceived through IVF or gamete intrafallopian transfer in the 1980s and 86 naturally conceived people.
They were asked to complete a questionnaire about their quality of life at age 18-28 and then a second time aged 22-35. The questionnaire included a World Health Organisation approved standardised quality of life measure that assessed four factors: physical, psychosocial, social relationships and environment.
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Australian Medical Association reveals full strain on the nation’s hospital system
Australia’s peak medical body has revealed just how dire the situation is in public hospitals across the country, with emergency departments buckling under pressure.
March 26, 2022 - 4:51PM
NCA NewsWire
Australia’s hospital system is “showing cracks” under the weight of increased demand and underfunding, according to the country’s peak professional body.
The Australian Medical Association’s annual public health system report card has revealed just how dire the situation is nationwide, as emergency departments have buckled under the pressure of the Covid-19 pandemic.
More than one in three people have waited longer than the clinically-recommended 30 minutes to receive urgent care.
AMA president Omar Khorshid said only 63 per cent of patients had been seen within the recommended period in the past year.
“One in three people who present to an ED will wait longer than four hours to be either discharged or admitted,” Dr Khorshid said.
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International Issues.
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Russia’s financial meltdown has China’s attention
By Jeremy Warner
March 20, 2022 — 11.30am
Russia first; next stop China. If American, British and European multinationals can quit Russia in protest at Vladimir Putin’s murderous assault on Ukraine, should they not also be considering their position in China, which is tarred with much the same autocratic brush as Russia and in some respects carries a similar degree of geopolitical risk?
For Ukraine read Taiwan, and for Russian paranoia about NATO’s eastward expansion, look to Beijing’s ever more aggressive pursuit of its own supposed sphere of influence in the East and South China Seas.
It is impossible to know for sure whether Putin told China’s Xi Jinping of his intentions when they signed their “no limits” partnership on the eve of the Winter Olympics in Beijing.
The answer is as unknowable as whether the COVID virus emanated from a Wuhan lab. Yet Beijing could see the military build-up on Ukraine’s borders as well as any. It is hard to believe the matter wasn’t even mentioned. Putin would have wanted reassurance that Xi was on side. Xi would in turn no doubt have partially believed Putin’s assurances that the land grab would be a walk in the park.
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Ramos-Horta on brink of claiming presidency in East Timor elections
Updated March 20, 2022 — 10.34pmfirst published at 4.09pm
Singapore: A bid by one of East Timor’s founding fathers, Jose Ramos-Horta, to return to the presidency has been strongly endorsed by voters in Australia’s near neighbour.
South-east Asia’s youngest country went to the polls on Saturday for its fifth presidential election and while counting continued on Sunday, Ramos-Horta, 72, was clearly in front.
With the backing of independence hero Xanana Gusmao’s National Congress for Timorese Reconstruction (CNRT) party, the Nobel peace prize laureate was seeking to return as president a decade after he failed to win a second five-year term. He served in the office between 2007 and 2012, during which time he survived being shot in what was an attempted assassination.
By Sunday evening, with 73 per cent of ballots tallied, 45.88 per cent of votes were in favour of Ramos-Horta, according to provisional data from East Timor’s electoral commission reported by Portuguese news agency Lusa.
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Ukraine invasion: Arrogance, hubris and overreach on road to Kyiv
11:00PM March 20, 2022
Now that Russia is into the fourth week of its barbaric war against Ukraine, it is time to ask whether it could have been predicted. Wars break out for numerous reasons: ideological, historical, geopolitical and territorial. This war is a mixture of great-power status, territorial ambitions and deep-seated historical contention.
Russia’s anger over Ukraine becoming a separate country takes us back more than 30 years to the collapse of the USSR. A recent article by Rodric Braithwaite, UK ambassador to Moscow from 1988 to 1992 and chair of the Joint Intelligence Committee from 1992 to 1993, takes a different approach from most commentators on this important issue. He makes it clear America and its allies “failed to avoid triumphalism” over the disintegration of the Soviet empire. The belief in Washington that America won the Cold War, and that it was now the world’s sole superpower, “led America into one diplomatic misjudgment after another over the next three decades”. Braithwaite considers that the Americans acted as if Russia’s foreign and domestic policy was theirs to shape. President Bill Clinton’s adviser, Strobe Talbott, is quoted as saying: “Russia is either coming our way, or it’s not, in which case it is going to founder, as the USSR did.”
Braithwaite concludes all this seeped into Russian public consciousness and aroused an overwhelming sense of humiliation and resentment. This coloured Russian attitudes in the making of policy for decades, “and was persistently underestimated by Western policymakers and commentators”.
In Braithwaite’s view, Western diplomacy towards Russia and Eastern Europe has been by turns arrogant and incompetent.
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12 hours show how Russia changed the global energy market
In the space of 12 hours, three events showed how the ripple effects of the energy shock caused by Russia are spreading across the world.
Mar 21, 2022 – 11.51am
The ramifications of sanctions on Russia and Europe’s urgent quest to wean itself off Russian energy exports will take years to play out, but within just 12 hours on Sunday night, investors were given a reminder of how the global energy map is already being redrawn by the conflict in Ukraine.
In the Middle East, Saudi Arabia’s giant oil company Saudi Aramco, announces it lifted profit in 2021 by 124 per cent to $US110 billion ($149 billion), and plans to turbocharge capital spending, citing a need for substantial investment to meet demand.
In Qatar, the government of one of the world’s LNG superpowers, agrees to work towards supplying Germany with LNG, as the European giant desperately tries to wean itself off Russian gas.
And in Austria, the government announces another €2 billion ($2.98 billion) of subsidies to try to cushion businesses and consumers from rising energy prices.
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Do not expect the war in Ukraine to end quickly
Peace talks or turmoil in Russia could halt the conflict, but the likeliest outcome is many more months of fighting.
Gideon Rachman Columnist
Mar 22, 2022 – 9.01am
“Tell me how this ends?” is one of those things that people say in films – and sometimes also in real life. It is the crucial question about the war in Ukraine – but one that is sometimes obscured by the sheer drama and horror of day-to-day events.
Just before the outbreak of the war, most military experts expected a swift Russian military victory. That turned out to be wrong – and there will be more surprises in store. So, all predictions have to be made with humility.
That said, there are three Ukraine scenarios that seem most likely. The first – which is both the most tragic and the most probable – is that this war continues for many months. The second possibility – put it at maybe 30 per cent – is that there is a peace settlement. The third scenario – which is perhaps 10 per cent – is that there is some sort of political upheaval in Russia, involving the overthrow of President Vladimir Putin and a new approach to Ukraine.
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Powell sharpens up multiple 50bps rate rise talk
Matthew Cranston United States correspondent
Mar 22, 2022 – 5.27am
Washington | Financial markets should prepare for more and faster interest rate increases after Federal Reserve chairman Jerome Powell said recessions were not caused by tighter monetary policy.
Mr Powell also said that the US central bank could raise rates in 50 basis point increments at upcoming meetings and leave rates higher in the longer term than would have traditionally been expected.
The hawkish tone comes less than a week after the Fed increased rates by 25 basis points for the first time in three years to dampen a 40-year high in inflation.
“If we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so,” Mr Powell told the National Association of Business Economists in Washington on Monday (Tuesday AEDT).
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https://www.afr.com/world/europe/how-hard-does-the-west-really-want-to-hit-russia-20220320-p5a6bs
How hard does the West really want to hit Russia?
The West has yet to use its full arsenal of sanctions against the Russian economy. What is the most effective thing it could do now?
Adrian Blundell-Wignall Columnist
Mar 21, 2022 – 3.05pm
The elephant in the room in the discussions about Ukraine is just how hard the US and Europe really want to hurt Russia. The United States could bring Russia to its knees economically within days, via full exclusion of all Russian banks from the SWIFT system and blocking all clearing in US dollars. It has chosen not to do so.
The SWIFT system sits at the very top of Western property right transfers.
Russia and much of eastern Europe were not a part of the Roman Empire that laid the basis of the Western legal system over centuries. Recall that The Merchant of Venice was a play about well-established contract law.
Compiled comprehensively by Emperor Justinian (the Corpus Juris Civilis) and further developed in the Napoleonic code, civil rights, contract law, and land and property registries were well established. The Charlemagne and Hapsburg empires brought Germany, the Czechs and Poland into the fold.
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Growing global food shortage stokes inflation fears
Russia’s invasion of Ukraine is pushing global food prices higher, stoking fears that dangerous inflationary pressures will become more entrenched worldwide.
Karen Maley Columnist
Mar 22, 2022 – 5.00am
As prices of basic foodstuffs and fertilisers continue to surge, economists are increasingly concerned that Russia’s invasion of Ukraine could spark a vicious wage-price spiral that will force central banks into more aggressive interest rate rises.
The conflict has plunged the global food market into disarray, as Russia and Ukraine are key exporters of foodstuffs such as wheat, corn, barley and sunflower oil.
Over the past five years, the two countries together have accounted for nearly 30 per cent of the exports of the world’s wheat, 17 per cent of corn, 32 per cent of barley (a crucial source of animal feed), and 75 per cent of sunflower seed oil, an important cooking oil in some parts of the world.
Prices for key agricultural commodities have jumped sharply since the invasion as Russia has blockaded the Black Sea, cutting off Ukrainian crop exports, 85 per cent of which are transported by sea.
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The West finds its purpose in the face of Putin’s butchery
Political and international editor
March 22, 2022 — 5.00am
An experienced war correspondent wrote a book in 2002 titled War is a Force that Gives Us Meaning.
It’s a disturbing thought, but it helps explain why humankind cannot seem to evolve beyond the calculated savagery of zero-sum, mass scale, state-sponsored violence.
Author Chris Hedges found that war is addictive. He laid out how the violent contest of kill or be killed is used to unite the tribe, the nation, the empire with meaning and common purpose.
War thrills and terrifies, it galvanises and electrifies. It transforms the every day into the epic. As Shakespeare had Henry V say in his famous “once more unto the breach, dear friends” exhortation to his troops: “In peace nothing so becomes a man as modest stillness and humility; but when the blast of war blows in our ears, then imitate the action of the tiger; stiffen the sinews, disguise fair nature with hard favoured rage.”
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https://www.afr.com/world/europe/putin-has-moved-to-plan-b-in-ukraine-20220322-p5a6r8
Putin has moved to ‘Plan B’ in Ukraine
Vladimir Putin’s Plan B is up against Joe Biden’s Plan A and Volodymyr Zelensky’s Plan A. Let us hope that Biden and Zelensky triumph because Putin’s possible Plan C is really scary, writes Thomas Friedman.
Thomas L. Friedman
Mar 22, 2022 – 10.43am
After a confusing month, it is now clear what strategies are playing out in Ukraine: We’re watching Russian President Vladimir Putin’s Plan B versus US President Joe Biden’s Plan A and Ukraine leader Volodymyr Zelensky’s Plan A.
Let us hope that Biden and Zelensky triumph, because Putin’s possible Plan C is really scary – and I don’t even want to write what I fear would be his Plan D.
I have no secret source in the Kremlin on this, only the experience of having watched Putin operate in the Middle East over many years. As such, it seems obvious to me that Putin, having realised that his Plan A has failed – his expectation that the Russian army would march into Ukraine, decapitate its “Nazi” leadership and then just wait as the whole country fell peacefully into Russia’s arms – has shifted to his Plan B.
Plan B is that the Russian army deliberately fires upon Ukrainian civilians, apartment blocks, hospitals, businesses and even bomb shelters – all of which has happened in the past few weeks – for the purpose of encouraging Ukrainians to flee their homes, creating a massive refugee crisis inside Ukraine and, even more important, a massive refugee crisis inside nearby NATO nations.
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Putin’s war demands a major global economic response
Martin Wolf Columnist
Mar 23, 2022 – 9.54am
Vladimir Putin’s assault on Ukraine will remake our world. How it will do so remains uncertain. Both the war’s outcome and, even more, its wider ramifications, including those for the global economy, are largely unknown.
But certain points are already all too evident.
Coming just two years after the start of the pandemic, this is yet another economic shock, catastrophic for Ukraine, bad for Russia and significant for the rest of Europe and much of the wider world.
As usual, the impact of refugees is mostly local. Poland already houses the second-largest refugee population in the world, after Turkey. Refugees are also pouring into other eastern European countries. More will come. Many will also wish to stay near their homeland, hoping for an early return. They need to be fed and housed.
Yet, the ramifications go far beyond Eastern Europe or even Europe as a whole, as an excellent interim economic outlook from the OECD shows. Russia and Ukraine account for only 2 per cent of global output and a similar proportion of world trade. Stocks of foreign direct investment in Russia and by Russia elsewhere are also only 1-1.5 per cent of the global total.
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Ukraine claims Russia’s military suffering ‘irreversible losses’
Hans van Leeuwen Europe correspondent
Mar 23, 2022 – 4.33am
London | Russia’s invading army has “lost its offensive potential” and is suffering “large, irreversible losses of personnel, including command”, Ukrainian military officials have claimed.
Reports from Ukrainian officials, not all of them verified independently, suggest Ukraine has recaptured some territory near Kyiv, and in the south its troops may be repelling Russia’s attempt to advance towards the south-western port of Odesa.
The Ukrainians also claimed on Tuesday that they were still keeping the Russians out of the besieged south-eastern port of Mariupol, though some US media reports suggested Russian ground forces had stormed into the city later that day (Wednesday AEDT).
Still, Ukrainian President Volodomyr Zelensky’s government is making increasingly confident claims that Russia’s forces are struggling with dwindling supplies and morale.
Britain’s defence ministry on Tuesday concurred that the Russian invasion force was “largely stalled in place”, though its daily update noted that the intense air and artillery bombardment of major cities was continuing.
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https://www.afr.com/policy/economy/four-weeks-on-and-ukraine-is-remaking-history-20220321-p5a6ly
Four weeks on, and Ukraine is remaking history
Putin’s assault has been called the end of ‘the end of history’. Yet Ukraine’s resistance in the name of democratic choice has remade history.
Mar 22, 2022 – 6.00pm
The Russia-Ukraine war is a month old. Many pre-war assumptions, and even a few old geopolitical certainties, now lie demolished on Ukraine’s roadsides with the burned out Russian tanks.
Moscow’s chances of occupying or pacifying Ukraine are low. No puppet government has been quickly installed to accept Vladimir Putin’s terms. Thousands of Russian soldiers are dead, yet Russia has a tenuous hold on just one Ukrainian city. Ukraine’s elected President Volodymyr Zelensky speaks as a global hero from Kyiv, and has not vanished into a Russian jail or worse. All these things will now weigh heavily at the negotiating table if and when the peace talks become serious.
The Ukrainians have had six years to prepare their tenacious defence, and it shows. The Russians were not ready for a real war. Their intelligence has been self-deceiving. They’ve been unable to conceal serious deficiencies in their armed forces, which are Moscow’s chief claim to superpower status. All Ukraine has to do is not lose, the classic strategy of the outnumbered, while Russia lurches further into a quagmire.
Russia is now trying to consolidate what it holds, pounding Ukrainian civilians from long range to kill, maim and displace them as refugees by the million. It has yet to give up any military objectives, and it still has the numbers. But the attrition is hard on Russians too. Losses to its best forces are already blunting the ability to storm and hold Ukraine’s big cities. And Ukraine’s successes will persuade more Western politicians that they have a backable cause, bringing more arms as well as sympathy.
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https://thenewdaily.com.au/opinion/2022/03/24/alan-kohler-putin-world-impact/
6:00am, Mar 24, 2022 Updated: 7:38pm, Mar 23
Whatever happens from here, Putin has already changed the world
The interviews with terrified, distraught people on buses out of Ukraine with nothing but the clothes on their backs, and images of bombed-out homes behind them, are very hard to watch.
We’re watching scenes resonant of some of the worst crimes in history, live, in full colour, that used to be seen only in newsreels of a grim, monochrome past.
The bombardment of Mariupol and Kharkiv, and now the outskirts of Kyiv, only make sense, beyond psychopathy, as a plan by Vladimir Putin to drive enough people out of Ukraine into neighbouring countries to cause a refugee crisis in Europe.
He must be hoping that it will force European countries, overwhelmed by the incoming numbers of destitute people, to press Ukraine President Volodomyr Zelensky and his soldiers to give up.
If so, it won’t work. Zelensky, supported by 90 per cent of Ukraine’s citizens, is clearly not for giving up, and Europe will absorb any number of Ukrainian refugees – the entire population of Ukraine if necessary – rather than go to war against a nuclear-armed madman.
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Will sanctioning Russia upend the global monetary system?
Few moves have raised the stakes in the global money system more than the West’s action to freeze Russia’s foreign currency reserves.
Jim O'Neill Columnist
Mar 23, 2022 – 7.53pm
The savage fighting in Ukraine has led many to wonder whether Russian President Vladimir Putin’s supposed strategic brilliance is all that it was chalked up to be.
Though Putin anticipated NATO wouldn’t respond militarily to his war, he seems to have underestimated the West’s capacity for solidarity.
The United States and its allies and partners have already implemented unprecedentedly severe economic and financial sanctions against Putin’s regime, and the decision to block Russia’s central bank from international financial markets (effectively freezing the country’s foreign-exchange reserves) is arguably a masterstroke.
True, Russia has diversified its reserves away from the dollar in recent years. But judging by the scale of the international response and its immediate impact on the Russian economy, this strategy appears to have been insufficient to maintain access to the financing it needs.
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https://www.afr.com/policy/foreign-affairs/india-must-be-clear-about-ukraine-20220322-p5a6xg
India must be clear about Ukraine
New Delhi’s reluctance to condemn Russian behaviour puts at risk its best chances of managing the rise of China with like-minded neighbours.
John McCarthy Former US ambassador
Mar 23, 2022 – 3.52pm
India’s stance on the war in Ukraine affects its standing as a major power, and therefore affects others in the Indo-Pacific region too.
For most governments, it has been relatively easy to take a view, even if the politics are less straightforward.
It became clear where Europe would stand once the remnants of Germany’s more flexible policy towards Russia were put on ice.
Russia’s small band of fellow travellers were only ever going to tip their lids in one direction.
China has become Russia’s worried second, embarrassed both by the latter’s ferocity and its poor actual performance in the ring. But it is still happier to see the West expend its energy in Europe, not in Asia.
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Putin adviser quits over Ukraine war and leaves Russia
Bloomberg
Mar 24, 2022 – 9.31am
Moscow | Russian climate envoy Anatoly Chubais has stepped down and left the country, citing his opposition to President Vladimir Putin’s war in Ukraine, according to two people familiar with the situation, becoming the highest-level official to break with the Kremlin over the invasion.
Mr Chubais, 66, is one of the few 1990s-era economic reformers who had remained in Mr Putin’s government and had maintained close ties with Western officials. Kremlin spokesman Dmitry Peskov didn’t immediately respond to a request for comment.
Known as the architect of Russia’s 1990s privatisations, Mr Chubais gave Mr Putin his first Kremlin job in the mid-1990s and initially welcomed his rise to power at the end of that decade. Under Mr Putin, Mr Chubais took top jobs at big state companies until the President named him envoy for sustainable development last year.
Mr Chubais announced his resignation in a letter to colleagues and friends on Tuesday, according to people who saw it. Last week, he hinted at a darkened outlook, saying in a post on Facebook on the anniversary of the death of Yegor Gaidar that the fellow economic reformer “understood the strategic risks better than I did and I was wrong”.
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Putin hits back at sanctions a month into Ukraine invasion
By Natalia Zinets, Natalie Thomas and Vitalii Hnidiy
March 24, 2022 — 5.15am
Talking points
· A barrage of shelling rocked Kyiv, and rockets slammed into a shopping mall and high-rise buildings.
· Western leaders gathered in Brussels to plan more measures to pressure Russian President Vladimir Putin to halt his campaign.
· Moscow plans to switch its gas sales to “unfriendly” countries to roubles, in a move to frustrate sanctions.
· A veteran aide to Putin, Anatoly Chubais, resigned over the Ukraine war and has left Russia with no intention to return, sources said.
· US President Joe Biden landed in Brussels for an emergency summit on Ukraine with NATO.
Lviv/Kharkiv: Russian forces bombed areas of the Ukrainian capital Kyiv on Thursday AEDT, a month into their assault, while Western leaders gathered in Brussels to plan more measures to pressure Russian President Vladimir Putin to halt his campaign.
The capital of Kyiv is still under fire. A barrage of shelling rocked the city on Thursday AEDT, with rockets slamming into a shopping mall and high-rise buildings in the districts of Sviatoshynskyi and Shevchenkivskyi.
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Worst of all worlds: The half-hearted sanctions against Russia have failed
By Ambrose Evans-Pritchard
March 24, 2022 — 5.00am
Russia has not defaulted on its sovereign debt after all. Nor is it likely to do so under the current sanctions regime, and as long as Europe continues to finance Vladimir Putin’s military state with purchases of gas, oil and coal.
The Kremlin is already sufficiently confident to reopen the Moscow stock exchange for bond transactions. The US Treasury’s sanctions office (OFAC) has made life easier by leaving a loophole for sovereign debt repayments, concerned that there might otherwise be a Lehmanesque shock to global finance.
The uninterrupted flow of fossil revenues - at windfall prices - is enough to cover interest service costs and redemptions. Goldman Sachs even thinks that the central bank will be able to relax capital controls gradually.
The rouble has not collapsed. It has stabilised after a 40 per cent devaluation, a manageable drop for a semi-autarkic economy. We are facing the failure of Western sanctions. Calibrated half-measures are not enough to change the Kremlin calculus or to dissuade Putin from a policy of attrition against civilian targets.
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Is a new global recession the price for punishing Putin?
By Daniel Moss
March 24, 2022 — 11.30am
Hanging tough against Vladimir Putin was never going to be cost free. Energy prices are soaring, firms are pulling out of Russia and those that stay are at risk of nationalisation. There’s concern about global food supplies.
Recession chatter has started, even as the world economy is still mopping up from the last one. It would be foolish to discount a fresh slump — if it isn’t already upon us.
The “R-word” was deployed a couple of times on Tuesday: International Monetary Fund Managing Director Kristalina Georgieva acknowledged risks are growing in a number of countries and Federal Reserve Bank of Dallas economists warned in a paper that the global economy likely won’t be able to avoid a slump, absent a resumption of Russian energy exports this year.
Ultimately, that depends on how much pain the US and its partners are prepared to endure to punish the Russian president for his invasion of Ukraine.
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Unfriendly fire: Putin is playing a risky game with his roubles-for-gas demand
Senior business columnist
March 24, 2022 — 11.53am
Vladimir Putin’s announcement that Russia will invoice gas buyers in “unfriendly countries” in roubles is either tactical genius or just a stunt that might backfire, most likely the latter.
The announcement, which mainly targets Europe, has thrown the European gas market into chaos, with prices spiking as commodity traders and utilities tried to grapple with the implications of an announcement that was short on detail.
Even Russia has yet to develop that detail. Putin said his government had directed its state-owned gas export monopoly, Gazprom, to begin work on amending existing contract for gas supplies and Russia’s central bank to develop a procedure to enable customers to gain access to the roubles required. He has given them a week to do so.
What Putin is trying to achieve is obvious. The West’s sanctions on Russia and, in particular, the freezing of more than half its $US640 billion ($854 billion) of foreign exchange reserves, initially trashed the rouble, sparking inflation, squeezing Russia’s ability to pay for imports and fund the invasion of Ukraine and instantly reducing ordinary Russians’ wealth and living standards.
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Ukraine Foreign Minister Dmytro Kuleba accuses EU of backsliding
By The Economist
3:35PM March 23, 2022
The EU surprised the world – and itself – with its unified response after Vladimir Putin ordered his tanks into Ukraine on February 24.
Unprecedented sanctions and new security policies swiftly appeared. But as the war grinds into its second month and Russian missiles and shells continue to rain on Ukrainian cities, European resolve has begun to wane. That is the stark assessment of Ukraine Foreign Minister Dmytro Kuleba.
“What we saw in the beginning of the war was the rise of the European Union as a powerful player that can bring change,” Mr Kuleba said. “What I see in the last 10 days in the European Union is backsliding back to its normality where it cannot decide on strong and swift action.”
From an undisclosed location inside Ukraine, Mr Kuleba highlighted two trials facing his country: Russian aggression on one side, and Western hesitancy on the other. The stakes remain as existential as ever, despite Russia’s initial setbacks on the battlefield.
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https://www.afr.com/markets/debt-markets/bond-investors-signal-us-recession-fears-20220324-p5a7fh
US recession in sight for bond traders
Cecile Lefort Markets reporter
Mar 24, 2022 – 11.41am
Bond investors are increasingly worried the US is heading for recession, casting doubt on the Federal Reserve’s ability to bring about a soft landing as it marches towards faster and higher interest rates to rein-in inflation.
The US yield curve has inverted, based on the 10-year and three-year bond yields, where the longer-dated bond now yields less than the shorter-dated bond. Should the closely watched 2-year bond rate exceed the 10-year, that would qualify as a classic recessionary indicator. History shows that out of 28 instances of yield inversion, 22 were followed by a recession.
The three- and 10-year spread has shrunk by about 61 basis points since the start of the year. On Thursday, US 10-year bond yields offered 2.29 per cent while 3-year yields were 2.31 per cent. The two-year rate is 2.11 per cent and confirms that the US yield curve has flattened.
James Alexander, joint head of global multi-asset at Nikko Asset Management, cautioned that such fluctuations can be fleeting and an inverted yield curve is not foolproof. “It is one of many measures that gives you some indication the economy is slowing down,” he said, adding “it can also give you a false signal.”
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Biden needs realpolitik, not ideals to win Ukraine war
The US President must come clean and admit the Ukraine war is not about democracy versus autocracy.
Janan Ganesh Contributor
Mar 24, 2022 – 10.24am
There is no discreet and low-key way of sending the Patriot antimissile system to another country, but Joe Biden is nothing if not a trier.
The US President has left it to unnamed officials in his administration to confirm that Saudi Arabia has taken receipt of these monstrous, truck-mounted interceptors.
You can quite understand the sheepishness. In 2019, he promised to make the journalist-killing kingdom a “pariah”. Just this month, he framed the modern world as a “battle between democracies and autocracies”.
What is glaring here is not Biden’s failure to live up to his ideals. It is the untenability of the ideals. Even when the US had a nuclear monopoly and a vast share of world economic output, it had to cut moral corners to fight communism in the nascent Cold War.
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Alina Kabaeva - the star gymnast who became Putin’s ‘Eva Braun’
Rosa Silverman
Mar 25, 2022 – 9.38am
Beautiful, talented and with an Olympic gold medal to her name, Alina Kabaeva was once regarded as the most eligible woman in Moscow. Today, though, she has a rather less desirable epithet, as “Russia’s Eva Braun”.
Kabaeva, 38, is the former gymnast turned politician who is widely believed to be the girlfriend, or possibly the wife, of Vladimir Putin. She is even rumoured to have given birth to four children by the Russian president, though reports of any relationship between the two have always been denied by the Kremlin.
As Putin commits ever greater atrocities in Ukraine, Kabaeva and her children are reportedly holed up in a Swiss chalet, facing growing demands to be extradited back to Russia.
“It’s time you reunite Eva Braun with her Führer,” says a Change.org petition to the Swiss government signed by almost 64,000 people at the time of writing, comparing her to the woman who married Adolf Hitler in his Berlin bunker the day before they both took their own lives.
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Sanctions to slash 15 years off Russian economy
5:24AM March 25, 2022
The economic warfare waged on Russia as punishment for its invasion of Ukraine will trigger a deep recession that will erase 15 years of growth, according to a new report from the Institute of International Finance.
Crippling sanctions that have virtually severed Russia from the international trade and financial system will drive a 15 per cent collapse in GDP, the Washington-based organisation said, as soaring inflation flattens demand.
As bad as the situation was already for everyday Russians, the damage to the country’s longer term prospects was “likely to be even more severe”, the report said.
Young Russian professionals were fleeing the country, and this “brain drain”, alongside a long-term collapse in foreign investment, would flatten the country’s growth potential, institute economists Benjamin Hilgenstock and Elina Ribakova said.
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Russian central bank chief tried to quit over Ukraine war
By Thomas Grove and Evan Gershkovich And Alexander Osipovich
The Wall Street Journal
March 25, 2022
Russian Central Bank Govenor Elvira Nabiullina tried to resign after the invasion of Ukraine, people familiar with the matter said. Her effort was rejected by Russian President Vladimir Putin who instead nominated her for a third term.
Over nearly a decade Ms Nabiullina has been one of Mr Putin’s most stalwart allies in buttressing the Russian economy against volatile oil prices and US sanctions in a growing face-off with the West, while remaining one of the few liberals who hold senior positions in the Russian government.
News of Ms Nabiullina’s desire to resign was reported earlier by Bloomberg. A spokeswoman for the central bank said Thursday: “Bloomberg’s information does not correspond to reality.” Ms Nabiullina has led Russia’s central bank since 2013. Last Friday, just hours before she was due to give a speech on the struggles of the Russian economy, Mr Putin reappointed her to a third term. Her second term was due to expire in June.
One of the people familiar with Ms Nabiullina’s thinking said she had been blindsided by the invasion of Ukraine and felt deeply conflicted over the war. Mr Putin ordered Russian forces into the neighbouring country on February 24, unleashing a conflict that has displaced more than 10 million people and reduced some Ukrainian cities to rubble.
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https://www.afr.com/world/europe/biden-visits-us-troops-in-poland-20220326-p5a857
Russia appears to reset military objective to Donbas
Bloomberg
The Russian military said it’s focusing efforts on taking full control of Ukraine’s Donbas region after a month of fighting that’s yielded limited territorial gains, potentially a sign Moscow may be backing away from hopes of taking larger swathes of the country.
With Kyiv-led forces having halted the invasion in many areas amid mounting Russian losses, a Ukrainian official also signalled that Russia is shifting tactics in stalled peace negotiations.
In Moscow’s most detailed official accounting of its military performance since President Vladimir Putin announced the February 24 invasion, Sergei Rudskoi, first deputy chief of the General Staff, said, “Our forces will focus on the main thing - the complete liberation of Donbas.”
Putin declared at the outset that Russia was seeking the “demilitarisation” and “de-Nazification” of Ukraine as he urged the Ukrainian armed forces to lay down their arms and go home rather than defend what he called a “junta” in Kyiv. Russian troops swept into the country from several directions, including near the capital, far from Donbas.
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Putin and Xi Exposed the Great Illusion of Capitalism
Unless the U.S. and its allies mobilize to save it, the second great age of globalization is coming to a catastrophic close.
By John Micklethwait and Adrian Wooldridge
24 March 2022, 3:01 pm AEDT
A book published in 1919 on “The Economic Consequences of the Peace” isn’t the obvious starting place for understanding the economic consequences of the current war in Ukraine. But it’s worth taking a little time to read John Maynard Keynes’s famous description of the leisurely life of an upper-middle-class Londoner in 1913 — just before the Great War changed everything:
The inhabitant of London [in 1913] could order by telephone, sipping his morning tea in bed, the various products of the whole earth, in such quantity as he might see fit, and reasonably expect their early delivery upon his doorstep; he could at the same moment and by the same means adventure his wealth in the natural resources and new enterprises of any quarter of the world, and share, without exertion or even trouble, in their prospective fruits and advantages.
Keynes then describes how this Londoner could speculate on the markets and travel wherever he wanted without a passport or the bother of changing currency (the gold standard meant that his money was good everywhere). And then the famous economist delivers his coup de grace by going inside the privileged Londoner’s head:
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https://www.afr.com/world/europe/this-man-cannot-remain-in-power-biden-on-putin-20220327-p5a89j
Biden on Putin: `This man cannot remain in power’
US President Joe Biden said Vladimir Putin “cannot remain in power,” dramatically escalating the rhetoric against the Russian leader after his brutal invasion of Ukraine.
Even as Biden’s words rocketed around the world, the White House attempted to clarify soon after Biden finished speaking in Poland that he was not calling for a new government in Russia.
A White House official asserted that Biden was “not discussing Putin’s power in Russia or regime change.” The official, who was not authorised to comment by name and spoke on the condition of anonymity, said Biden’s point was that “Putin cannot be allowed to exercise power over his neighbours or the region.”
The White House declined to comment on whether Biden’s statement about Putin was part of his prepared remarks.
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Ukraine has made Joe Biden a wartime president. But is he up to the challenge?
March 27, 2022 — 7.52am
As a two-term vice-president, a politician for the last 50 years, and a former chair of the Senate Foreign Relations Committee, Joe Biden is no stranger to the drumbeat of war.
He confronted America’s fatigue in Vietnam as a new Senator in the 1970s. He had a front-row seat to geopolitical tensions between the US and the Soviet Union in the 1980s. And he voted against the attack on Iraq during the Gulf War of the 1990s before inheriting the challenges of Syria and Afghanistan several decades later.
But Russia’s invasion of Ukraine has made Biden a slightly different kind of wartime president, as he tries to defeat a ruthless dictator without wanting the US to fire a single attacking shot.
“For God’s sake, this man cannot remain in power,” Biden said of Russian President Vladimir Putin in a strongly worded speech in Poland today, which concluded a three-day trip to Europe to discuss the war on Ukraine.
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I look forward to comments on all this!
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David.
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