June 27, 2019 Edition.
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We seem to be heading towards some sort of conflict with Iran. This can’t be a good idea as far as I can tell. In the last week or so Trump has launched a cyber-attack on Iran and almost attacked physically – he is clearly out of hand! We have the G20 meeting on the weekend - may be a pretty dramatic meeting!
Brexit is on hold while we see who becomes the British PM. Boris is favourite but seems to be beating up his girlfriend so it is hard to know just how it will all work out. Time will tell.
In OZ the PM is on holiday so we are having a calm period – Parliament comes back next week! The PM will also be at the G20 - seems he wants people to behave better. Time will tell!
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Major Issues.
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https://www.afr.com/real-estate/residential/auction-results-strongest-in-over-a-year-20190616-p51y5d
Auction results strongest in over a year
Jun 16, 2019 — 1.13pm
The housing market surged back to life in the first big auction weekend since the Reserve Bank cut the cash rate to a record low of 1.25 per cent on June 4.
CoreLogic recorded a preliminary national clearance rate of 66.4 per cent from almost 1500 auction this week and said the final figure would hold above 60 per cent for the first time in over a year.
This compared with a 52 per cent clearance rate for the same week last year (though there were over 2000 auctions) and a 48.3 per cent final clearance rate last week when there were just 805 auctions due to the Queen's Birthday long weekend.
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Universities of uniformity cannot play their role in society
Humans decide by debate how their societies should go forward. But in our academia, all the voices are stacked on one side.
Jun 16, 2019 — 11.54am
Our universities, like their counterparts in the UK and America, have a slogan. They believe in diversity and inclusion. That’s nice. In any liberal democratic society, don’t we all. Let’s think about it. If inclusion means anything, it means a university welcomes within its community people of all races and if people are gay or even if they chose to change their genders, they’re welcome. In such an institution, discriminating against people on those grounds is just plain wrong. They shouldn’t, whoever they are and whatever their sexual preferences, be subject to arbitrary discrimination.
Universities cannot lead debate when they no longer reflect society. Louise Kennerley
And diversity is prima facie part of the same argument. You’d expect some of the faculty members and the professional services staff to be straight men and straight women and a few will be gay. And fewer still might even be transgender. So what? If they’re gifted researchers and good teachers, that’s what matters.
But diversity and inclusion means more than that. It means intellectual diversity and inclusion. Ironically, that’s where universities have lost the plot. It’s said that academics, particularly in the humanities and social sciences, are largely left-wing. Largely left-wing is a joke. They’re not largely left-wing. They’re almost all left-wing. That’s pretty odd.
Note: Inclusion Does NOT Imply Endorsement.
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Controversial reforms stalled until politicians win back our trust
Ross Gittins
Economics Editor
June 17, 2019 — 12.00am
For those who care more about good policy than party politics, there are unpleasant conclusions to be drawn from the federal election. The obvious one is that it was a case of policy overreach leading to failure.
The less obvious one is that decades of misbehaviour by both sides have alienated so many people from the political process and turned election campaigns into such a cesspit of misrepresentation and dishonesty that, henceforth, neither side will be game to propose or implement controversial reforms.
The election was lost by the party proposing to remove a long list of sectional tax breaks and use the proceeds to increase spending on hospitals, schools and childcare, and won by the party that couldn’t agree on any major policies bar a humungous tax cut.
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Australia has a China problem and we can't leave it to faceless spooks
Tony Walker
Columnist and award-winning foreign correspondent
June 16, 2019 — 11.28pm
Australia has a China problem. It’s not in Beijing. It’s not on the streets of Hong Kong. It’s in Canberra. China policy is in flux, under stress and confused.
Australia’s meek response to the pro-democracy mass demonstrations in Hong Kong contrasts with attitudes in its own security establishment that are redolent of a Cold War era.
One week Prime Minister Scott Morrison is venturing into the South Pacific to “confront’’ China, according to a ridiculous headline in a national newspaper, the next his government is missing in action on an issue of fundamental rights.
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Forward defence in depth for Australia
12 Jun 2019
With the re-election of the Scott Morrison-led Coalition government in May 2019, the future shape of Australian defence policy needs to be examined.
The strategic assumptions that underpinned defence policy choices in the 2016 Defence White Paper were made in the years preceding the release of that document and extend from earlier white papers, including those released in 2009 and 2013.
Their foundation goes back to the days of the 1986 Dibb Report and the 1987 Defence White Paper. In the next Defence White Paper, which could emerge as early as 2021, a continued approach that places too much emphasis on defending the inner arc—notably the ‘sea–air gap’—would not adequately address emerging strategic risks to regional stability.
The strategic environment has evolved at such a pace that policies announced in 2016 have been overtaken by events. It’s time for a review of Australian defence strategy. It’s time for something new.
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Leader woes, crime focus led to Liberal drubbing at state election
By Adam Carey
June 16, 2019 — 4.33pm
Former opposition leader Matthew Guy’s poor image among voters, Malcolm Turnbull’s dumping as prime minister and a lopsided focus on law-and-order issues all contributed to the party’s heavy loss at November's state election, an internal review has found.
Senior Liberal strategist Tony Nutt delivered some home truths to the faithful in an address to the annual state council on Sunday, telling them the party needed to get tougher and connect better with swinging voters, or face being in permanent opposition.
Labor Premier Daniel Andrews and his team won because they effectively framed the political contest around their agenda of road and rail upgrades, while marginalising Liberal campaign talking points on crime and cost of living, Mr Nutt said.
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Stan faces uncertain times as its sweetheart deals expire and rivals muscle in
- 12:00AM June 17, 2019
It’s been the halo sitting over Nine Entertainment Co since its merger with Fairfax Media brought full ownership of the Stan streaming business under the one roof last year.
But Stan’s subscription growth and climb out of heavy losses is set to face its sternest test with the expiry of a number of content deals, rising program costs and the arrival of new competition from studios looking to emulate the success of US giant Netflix.
Efforts have been under way to find an equity or content partner for the business in a bid to see it through what is shaping as a period of dramatic change in the market that could include some consolidation of the local players.
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https://www.afr.com/personal-finance/budgeting/10-predictions-for-shares-from-july-1-20190529-p51sef
10 predictions for shares from July 1
Slower global growth, a tech bust and a boost to tourism thanks to a lower Aussie dollar are on professional investor Chris Stott's radar from July 1.
Chris Stott Updated Jun 17, 2019 — 11.03am
Key Points
- Companies that could be takeover targets include HT&E Limited, Eclipx and Asaleo Care.
- Companies well positioned to benefit from a lower Aussie dollar include Sealink and Sydney Airport.
With persistently high levels of market volatility and continued economic uncertainty globally and in Australia, what's the outlook for the ASX over the financial year ahead?
Markets always present a level of uncertainty, which provides opportunities for active investors to capitalise on volatile markets. Potential “green shoots” are appearing that provide a strong base for the medium-term outlook of the domestic economy.
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Spoon-feeding universities infantalises students
Higher education was once the doorway to serious adult thought. Now students leave as childish as when they arrived.
Frank Carrigan
Jun 17, 2019 — 11.45am
Entry into a university should be a key rite of passage. It should be a transition to adulthood. It should be a ticket to young people becoming the captains of their consciousness. Ties of dependence should fray in the academy. Certainly university should not prolong childhood. Yet, contrary to the orthodoxy, university infantilises its young charges. How it achieves this aim has its origins in both history and in the modus operandi of the modern university.
From historians we learn that in medieval society there was no long period of childhood. Children simply got used to mingling with adults, and partaking in their lives, at an early stage of development. The passage to adult society was swift. There was no Chinese wall between children and adulthood.
Parents bear a large slice of the blame for reconfiguring the concept of childhood. Across the social strata the home became a refuge for cosseting children and putting the focus on their future social mobility.
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Australia risks 'slow decline' without reform
Jun 18, 2019 — 12.00am
Key Points
- Australia faces big economic, social and environmental challenges
- A new report warns big changes are required to confront the future
- Boosting productivity would help lift incomes
The economy is at risk of descending into a slow long-term decline if governments and business fail to take action on significant economic, social and environmental challenges, a new landmark study has warned.
Real incomes could be almost $40,000 higher or lower by 2060 depending whether or not political, business and civic leaders take bold steps to face up to a world being disrupted by technology, an ageing and growing population and climate change, the Australian National Outlook says.
Informed by more than 50 senior leaders from 23 businesses, non-government organisations and universities, the two-year study led by CSIRO chairman David Thodey and National Australia Bank's outgoing chairman Ken Henry concludes the country is at a "crossroads".
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No transparency in home care costs, report finds
- 12:00AM June 18, 2019
A new analysis of the multi-billion-dollar taxpayer-funded home-care industry has found some providers are charging 50 per cent more than others for the same care.
The study also found some home-care providers charging up to $190 an hour for rudimentary services such as gardening, prompting warnings the system is failing to deliver value for both taxpayers and customers.
The author of the study, Primetime founder Peter Tyndall, said his findings and the transparency around home-care pricing showed the system was “a dog’s breakfast” in its current form.
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Desperate off-the-plan buyers seek early exit
Jun 17, 2019 — 6.42pm
Desperate off-the-plan buyers of Melbourne apartments have turned to online selling platforms to get out of their contracts, as valuation shortfalls surge amid the current market downturn.
“Settlement risk is now very real and developers should be worried,” said Colin Sacks, who runs the country's biggest DIY website, forsalebyowner.
“In the last few days we have had a plethora of calls from people who bought properties off the plan a few years ago.”
“It’s now time to settle and they either can’t settle or simply don’t want to.
This creates huge risk for developers who need these buyers to pay up to fund the project,” Mr Sacks said.
This creates huge risk for developers who need these buyers to pay up to fund the project,” Mr Sacks said.
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Real question is how far NSW economy will fall
By Ross Gittins
June 18, 2019 — 4.14pm
If you’ve ever got a dodgy proposition you want spruiked, see if you can get NSW Treasurer Dominic Perrottet to do it.
His budget offers the most optimistic view of the next four years, leading our state to a new Golden Century (and here was me thinking the Golden Century was where Sussex Street Labor went for a Chinese meal).
NSW Treasurer Dominic Perrottet says the government offers interest-free loans for solar panels and batteries and supports the National Energy Guarantee.
Behind all Perrottet’s bravado, however, he has taken his lumps, using his budget to absorb some of the economic pain and keep stimulating the state’s slowing economy.
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Australia turned blind eye to deeply offensive threat from China
Chris Uhlmann
Nine News Political Editor
June 19, 2019 — 12.00am
What is it that terrifies the people of Hong Kong about the Chinese Communist Party that eludes so many pliant Australian academics, business leaders and ex-politicians?
In the same breath, some local cognoscenti lament the Australian government’s weakness in barely mentioning the troubles in the Chinese territory before returning to their rote gripe that Canberra’s national security establishment is too hawkish.
Australia’s intelligence agencies are better described as cautious about the balance of risks and opportunities that come with China’s rise because, unlike their critics, they are not wilfully blind. The agencies are not seeking to contain China and understand it will be the dominant power in our region but worry about that because they see in the Chinese Communist Party what the people of Hong Kong see.
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'There is no rift': universities move to implement free speech code
By Henrietta Cook and Fergus Hunter
June 18, 2019 — 7.34pm
Australian universities have started rolling out a new code to protect free speech on campus despite some reservations in the tertiary sector.
The country’s largest university, Monash University, is assessing its policies to ensure they comply with a free speech model that was proposed by former High Court chief justice Robert French in a government-commissioned review.
The University of Sydney will consider implementing
Monash University vice-chancellor Margaret Gardner said her university was carefully examining its existing free speech policies to ensure they stacked up against the code put forward in Mr French’s “nuanced” report.
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‘Highly paranoid world view corrupting our kids’ thinking’
- June 19, 2019
Corrupt activist scholarship in gender, queer and other identity fields is training the teachers who shape children and executives who run business, warns visiting culture critic Helen Pluckrose.
“This is not a problem confined to esoteric arguments between intellectuals — liberal academia has great cultural power,” Ms Pluckrose, a Britain-based medievalist, said last night in a Sydney lecture at the Ramsay Centre for Western Civilisation.
“A generation of students were exposed to these ideas and went on to become leaders of various industries.
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Global money managers go defensive
Jun 19, 2019 — 11.14am
Global fund managers are the most bearish they've been since the global financial crisis as pessimism over the trade war and "monetary policy impotence" has shattered investor confidence.
The latest Bank of America Merrill Lynch Global Fund Manager Survey showed professional investors were rotating out of equities and into more defensive assets like bonds, cash, staples and utilities, as they prepared for a decline in global growth.
The rotation comes as equity market valuations globally and locally soar to record or decade long highs. The Australian sharemarket climbed within 3 per cent of its all-time high on Wednesday morning.
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The Aussie company at the heart of Britain's Woodford furore
Jun 19, 2019 — 3.30pm
London | Australia's largest superannuation administration company, Link Group, has been thrust right into the centre of a major financial furore in Britain, which has brought the stellar career of the "British Warren Buffett" crashing down to earth.
Britain's market regulator, the Financial Conduct Authority (FCA), on Tuesday (Wednesday AEST) launched an investigation that will delve into the ASX-listed Link Group's oversight of the struggling flagship fund of fallen star stockpicker Neil Woodford.
Link's involvement arises because one of its British units – Link Fund Solutions (LFS), which it bought from Capita for $1.5 billion in 2017 – is the authorised corporate director of the £3.7 billion ($6.8 billion) Woodford Equity Income Fund (WEIF).
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A 100-year history of the Aussie sharemarket
Jun 19, 2019 — 4.28pm
As we approach all-time highs on the ASX even as the economic outlook grows gloomier, it may feel like a time of great frothiness on the sharemarket.
Certainly, we are living in a world of financial market extremes. This is, after all, a period in which Kiwi stocks are more expensive than Wall Street's tech sector.
Then there's the recent "fake meat" bubble (an ugly visual). Shares in vegan-friendly Beyond Meat have soared 690 per cent since the company listed on the New York Stock Exchange in early May.
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Early education delivered $4.74b payday
Jun 20, 2019 — 12.00am
One year of investment in early childhood education yielded $4.74 billion in benefits associated with wages growth, productivity, and social health, according to a PwC report.
The figure, which takes 2017 as its reference year, represents a twofold return on the $2.34 billion incurred in costs by the government and parents or carers.
PwC chief economist Jeremy Thorpe said the findings justified further investment in early education, and the issue had to be viewed not as "glorified childcare" but as a matter of "microeconomic reform".
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Blowing in the wind: Australia's China policy is all over the shop
John Hewson
Columnist and former Liberal opposition leader
June 20, 2019 — 12.00am
While the drift in most areas of public policy is becoming alarming, perhaps our so-called China policy is among the most concerning.
Our positions on China virtually blow in the wind. It seems we simply hope to muddle through, rather than to develop and respond in terms of a well thought out and defined longer-term strategy on our relations with China.
This, in itself, undermines our credibility in Chinese eyes, a nation that thinks, plans and operates in terms of generations. Why should the Chinese take us seriously when we seem to have little concept of our national interest. We are reactive rather than proactive, simply responding, and often inconsistently, as matters arise.
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RBA says QE is 'quite unlikely'
Jun 20, 2019 — 12.39pm
Reserve Bank governor Philip Lowe said the failure of the major banks to fully pass on any future interest rate cuts would not trigger unconventional monetary policy, saying the central bank was "quite unlikely" to go down that route.
However Dr Lowe said more interest rate cuts on top of the first move in almost three years, on June 4, would be needed to reduce unemployment and get inflation back to a more comfortable level.
"It is not unrealistic to expect a further reduction in the cash rate as the board seeks to wind back spare capacity in the economy and deliver inflation outcomes in line with the medium-term target," Dr Lowe said.
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How a China slowdown would hit the economy
Jun 20, 2019 — 12.57pm
The Reserve Bank of Australia says a 5 per cent drop in Chinese growth would depress Australian economic growth by 2.5 per cent over three years, with commodity prices and equity prices taking a hit.
In its latest bulletin, the central bank modelled how a shock slowdown in the Chinese economy could work its way through to Australia.
“The possibility of a slowdown in China is often highlighted as a key uncertainty for Australia's economic outlook,” the Reserve Bank said.
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How it went down: The raid that gutted a major Australian broking firm
By Elizabeth Knight
June 21, 2019 — 12.10am
The staff raid that led to the near-gutting of broking and financial services firm CLSA by US aggressor Jefferies was swift, strategically executed and choreographed with precision.
It was 4pm Australian time on Friday June 7, when the head of Human Relations at CLSA’s Hong Kong parent Citic Securities received an email dump - 26 simultaneous resignation alerts, and all from Australia.
It was the ultimate hit list - ranging from its local chief executive Andrew Norman and head of research Richard Johnson, sales boss Ed Clegg and head of trading Karl Guilfoyle to sales staff and highly rated analysts.
CLSA had been hollowed out. Only one third of the equities division remain. And Chinese-owned Citic hadn’t seen it coming, was rendered punch drunk and is now engaged in damage control.
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The law tests parenting versus parentage
Jun 21, 2019 — 4.31pm
Nature and nurture proved a decisive combination in this week's landmark sperm donor decision in the High Court.
Under the microscope ...the High Court said deciding whether a person was parent was "a question of fact and degree". Penny Stephens
How the law keeps up with technology was again a talking point. And whether it can keep pace with the complexity of modern relationships.
But Robert Masson's victory – the first time a donor had tested his rights in Australia's top court – didn't settle the issue of whether a donor has parental rights.
The answer, it seems, is one beloved by all lawyers; it will be decided on a case-by-case basis.
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There's one thing, politicians just can't resist when the economy goes bad
Ross Gittins
Economics Editor
June 22, 2019 — 12.00am
Years ago, I came to a strong conclusion: the politician who could resist the temptation to use the budget to prop up the economy when it’s falling in a heap and making voters hugely dissatisfied has yet to be born.
So let me make a fearless prediction: whatever they’re saying now, sooner or later Treasurer Josh Frydenberg and his boss Scott Morrison will use “fiscal policy” (aka the budget) to help counter the sharp slowdown in the economy that, if we’re not careful or our luck doesn’t hold, could lead to something much worse.
How can I be so sure? Because I’ve seen it happen so many times before. As I wrote in this column last week, since the late 1970s it’s been the international conventional wisdom among governments and their advisers that “monetary policy” (interest rates) should be the chief instrument used to stabilise the economy as it moves through the ups and downs of the business cycle, with fiscal policy focused instead on achieving “fiscal sustainability” – making sure the public debt doesn’t get too high.
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The downside of being a landlord nation
If you are a government elected unexpectedly and with no real agenda, it seems your only real option is to try to define yourself by what your opposition does, or doesn’t do.
Laura Tingle Columnist
Jun 21, 2019 — 3.20pm
Home Affairs Minister Peter Dutton only managed to get three words into a substantive interview on Insiders last weekend before he started talking about the Opposition.
The question was about who had leaked classified documents from his portfolio. But his answer was all about how Anthony Albanese was only asking questions about the leak because he was trying to distract everyone from Labor’s problems.
This would have to be somewhere between "marvellous" and "magnificent" on the irony-o-meter since the only thing anyone in the government seems to want to talk about at the moment, particularly this week, is the opposition.
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Anyone who goes to uni knows free speech on campus is stifled
By Julie Szego
June 22, 2019 — 11.59pm
Federal Education Minister Dan Tehan says universities are "failing Australia" by refusing to champion free speech on campus. Discuss. Just don't discuss it in your "Queering Marxism" tute lest your wokeness be called into question.
"There's a growing sense," Tehan wrote in The Australian last weekend, "that some students… are self-censoring out of fear they'll be shouted down or condemned for expressing sincerely held views and beliefs, or for challenging widely accepted ideas."
This is one of those topics that necessitates separating the message from the tarnished messenger. A crusade for free speech on campus is another of the government's hey-look-over-there! capers.
A government-commissioned report by former High Court chief justice, now chancellor of the University of Western Australia, Robert French, found no evidence of a "systemic" crisis of free speech on Australian campuses. But as with the Ruddock report on freedom of religion, which found freedom of religion was not under threat, the French review sounds just enough cautionary notes for the government to open a new flank in the culture wars.
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‘No proof printing money works’
- 12:00AM June 22, 2019
One of the world’s top economists has questioned the effectiveness of “money printing” to save economic growth, likening it to religion, as the Reserve Bank inches closer to more extreme monetary policy to boost inflation.
As the chance of a second interest rate cut, possibly as soon as next month, by the Reserve Bank gathers pace, Raghuram Rajan, the economist who famously forecast the Global Financial Crisis, said quantitative easing was based on “faith”.
“The jury on QE is still out,” he told The Weekend Australian. “If you simply look at the data, it’s very hard to see an impact on long-term rates,” he added.
Quantitative easing, or creation of new money electronically to buy assets, has been deployed by central banks in Europe, Britain, Japan and the US in the trillions of dollars (or equivalent) to try to reduce long-term interest rates, thereby inducing business investment and economic growth.
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Federal Election.
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'Too hard, too controversial': Government urged to put abortion strategy into practice
By Judith Ireland
June 23, 2019 — 12.00am
Women's health advocates are urging the Morrison government to come up with a specific plan to boost public access to abortions, after the Coalition pledged to work towards "universal access" to termination services before the election.
But the federal government has ruled out using federal-state funding agreements to force hospitals to deliver more publicly funded terminations and says states have primary responsibility for abortion services.
Shortly before the election was called in April, Health Minister Greg Hunt released a 10-year national women's health strategy that lists "equitable access to pregnancy termination services" as a key measure of success.
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Royal Commissions And The Like.
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Challenger escapes Hayne wrath, but its performance has not
The country’s biggest annuities business managed to escape the glare of the Hayne royal commission but its performance in the past 18 months has left a lot to be desired.
Jun 16, 2019 — 2.35pm
For a company that has pitched itself as safe and reliable, offering retirees the chance to future-proof their retirement by investing in annuities, Challenger’s performance in the past 18 months has left a lot to be desired.
The country’s biggest annuities business managed to escape the glare of the Hayne commission but its performance hasn’t.
In 18 months, it has gone from being one of the top-performing companies in the financial services sector to one that has fallen into the ignominious camp of performing almost as poorly as the scandal-ridden IOOF and AMP as investors abandoned the shares.
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Intrusions that just drive us crazy
AFL thought police and ASIC shrinks are part of the same plague of busy-bodying and corporate red tape that now make up our biggest industry.
John Roskam
Jun 21, 2019 — 12.00am
Maybe ASIC is trying to do to big public companies what the AFL is well on the way to doing to the game of Australian football.
Numerous and never-ending changes to the rules, ever-shifting interpretations of those rules by an ever-increasing number of umpires and tribunals, and now the introduction of ''Behavioural Awareness Officers'' patrolling through the crowd is a recipe for the destruction of a once-great game.
Players, coaches and most importantly AFL supporters now spend more time talking about the latest hare-brained scheme from AFL House than they do talking about the game of football. And this doesn't take account of the fact that it's impossible to attend a game of AFL football without being preached at by the AFL about climate change, identity politics or whatever is the latest bien pensant topic that's taken the fancy of the administrators. To know what Australia could look like in a decade one only needs to study the AFL today.
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ASIC's shrink 'will distort the work of the board'
Jun 22, 2019 — 12.00am
AMP chairman David Murray said the decision by the corporate regulator to insert psychologists into boardrooms will distort the way boards operate and warned there was no one way to ensure sound governance.
Mr Murray, a former chief executive of Commonwealth Bank and chairman of the 2014 financial system inquiry, also raised questions about the ability of psychologists to pass judgment on boardroom culture.
Mr Murray said it was not plausible to expect directors to act in their usual manner if there was a psychologist observing proceedings.
“You can’t not change the behaviour in the room with someone sitting there. The board will change the way it acts. You distort the work of the board,” Mr Murray said.
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National Budget Issues.
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https://www.afr.com/news/economy/rising-home-loan-arrears-pose-no-stability-risk-rba-20190617-p51ym1
Home loan arrears 'highest in years'
Jun 18, 2019 — 9.32am
The Reserve Bank's head of financial stability Jonathan Kearns said economic conditions and lending standards have pushed home loan arrears rates higher, a trend that will persist but, at this stage, poses no risk to financial stability.
Weak income growth, housing price falls, rising unemployment along with earlier weaker lending standards, and the more recent tightening in lending standards have all contributed to the rise in arrears, Mr Kearns told the Property Leaders’ Summit in Canberra on Tuesday.
"The share of banks’ housing loans in arrears is now back around the level reached in 2010, the highest it has been for many years," Mr Kearns said.
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RBA bond buying more 'potent' in Australia
Jun 18, 2019 — 12.00am
Key Points
- The US Fed bought bonds following the global financial crisis
- The RBA is running out of space to cut interest rates
- Stephen Kirchner says QE should be executed swiftly if it is called upon
The Reserve Bank of Australia should learn from the financial crisis mistakes of the US Federal Reserve and swiftly shift to "quantitative easing" stimulus if the RBA runs out of space to cut interest rates, a new report says.
Fuelling the emerging debate about whether the RBA will have to resort to unconventional bond buying measures if the cash rates fall below 1 per cent, United States Studies Centre economist Stephen Kirchner has written a new report to argue that QE could be more effective in Australia if it was implemented decisively and was an unlimited commitment.
"Australia could implement a smaller but more effective QE program than the Fed," Dr Kirchner said.
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Tax cuts are no handout to the rich
Jun 18, 2019 — 12.00am
Tax paid by high income earners will vastly outstrip their growth in wages unless the Senate passes the full tax cut package, a new analysis shows.
With Labor and the Senate crossbench declining to commit to the full tax package and rejecting the government's claims it has a mandate, the analysis shows the tax cuts do little more for high income earners than keep bracket creep at bay and preserve the proportion of tax they currently pay.
The resistance towards the tax package is focussed on stage three which would begin on July 1, 2024. It will apply a 30 per cent tax rate to all incomes between $45,000 and $200,000 at a cost of $95 billion, of which an estimated $33 billion would go to people currently earning over $180,000.
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Mortgage arrears rate at highest rate since GFC, says Reserve Bank
By Shane Wright
June 18, 2019 — 10.45am
A lift in the number of Australians behind on their mortgages is a sign of a slowdown in the economy and the problems caused by slow wages growth, the Reserve Bank of Australia has admitted.
The head of the bank's financial stability department, Jonathan Kearns, used an address to a property summit in Canberra on Tuesday to release data showing the number of people in arrears on their home loans had now reached the level recorded during the global financial crisis.
Mr Kearns said although the proportion of people behind was still low at just on 1 per cent of all loans, the growth in mortgages in arrears was evidence of broader issues facing the economy.
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Rate cut 'more likely than not'
Jun 18, 2019 — 12.12pm
The Reserve Bank expects further interest rate cuts are likely, with minutes from the bank's last board meeting revealing a much more dovish tone than previously thought.
The bank said the spare capacity in the economy meant that stronger wage growth and increased inflation was still some way off and that further rate cuts from the current low of 1.25 per cent would be needed to stimulate the economy and employment.
In the wake of the RBA minutes, the Australian dollar immediately lost ground, falling 0.2 per cent.
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Falling rates leave ASX investors searching for yield
Australia is a global destination for yield hunters and the pressure is likely to become even more intense.
Jun 18, 2019 — 4.52pm
As rates fall around the world, investors are forced to go that extra mile for yield – literally.
Yesterday I wrote how New Zealand's sharemarket is now more expensive than America's tech-heavy Nasdaq.
The new leg-down in global rates this year – at home and abroad – has made the search for income even more intense. Ten-year bond yields have on average dropped by more than 0.8 percentage points over the past year, and by 1.4 percentage points in Australia.
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'The debt bomb is still ticking'
Paulina Duran and Jonathan Barrett
Jun 18, 2019 — 3.56pm
Key Points
- Wider risk spreads for riskier RMBS tranches
- Australia's east-coast property prices have slid since 2017
- S&P says problem home loans on the rise
- Demand for safer portions of mortgage debt remains strong
Investors in Australian mortgage bonds are demanding higher premiums to buy the riskiest tranches of new debt, as a slowing economy stokes concerns a property downturn could get worse and increase home loan defaults.
High-yield investors are receiving up to 40 basis points more than they were last year to buy the lower-rated and unrated portions, according to an analysis of recent deals by large lenders including AMP, National Australia Bank and Members Equity Bank.
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NSW joins other states in forecasting bleaker outlook for economies
By Shane Wright and Matt Wade
June 20, 2019 — 12.00am
NSW has joined other states and territories in forecasting relatively weak wages and employment growth, calling into question Morrison government spending plans and a return to federal surplus.
A breakdown of key economic forecasts made by all state and territory treasuries over the past month reveal none are as optimistic about wages, inflation, jobs growth or the overall state of the economy as the federal government.
The federal budget was brought forward to early April, meaning many of its forecasts were compiled in late March and ahead of a string of key insights into the economy.
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Coalition tax plan would give Australian workers an edge
By Shane Wright and Eryk Bagshaw
June 21, 2019 — 5.50pm
Middle- and high-income earners will face some of the highest tax rates in the English-speaking developed world unless the Morrison government's $158 billion tax plan is passed in full when Parliament returns next month.
A breakdown of tax rates across Australia, the United States, Canada, the United Kingdom and New Zealand shows that without the federal government's proposal, domestic workers would be thousands of dollars worse off compared to their international compatriots.
Across incomes at the $100,000 and $250,000 level, the government's plan would not cut the payable tax of Australian workers but would make the overall tax system more competitive with other nations.
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Health Issues.
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Dire warning from health boss
- 12:00AM June 17, 2019
The head of Australia’s largest not-for-profit health and aged care provider, Toby Hall, has called on Health Minister Greg Hunt to choose between leaving a lasting legacy or leaving the healthcare system in a “dire state” as he calls for tough new reforms.
Mr Hall, chief executive of St Vincent’s Health Australia — operator of both public and private hospitals — said the public and private systems had worked well for the past 20 years but the country’s healthcare system was now at a tipping point.
“If we don’t have the right approach and we don’t look at how the two systems can work together more effectively, I think we will end up with a system that is not the dream that Australia has had for the last 20 years or so,” he said.
The hospital chief said Mr Hunt had introduced key reforms last year to address concerns about private health insurance but the more significant changes were needed.
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Government crackdown on abuse of antibiotics
- 12:00AM June 17, 2019
Doctors could be prevented from prescribing repeats of antibiotics as authorities consider radical plans to contain the dangerous spread of superbugs through hospitals, aged-care homes and the wider community.
With limited progress so far on containing the threat, health professionals have been put on notice that government intervention is now likely — and may extend to the fields of agriculture and environment.
Federal departments reviewing Australia’s five-year anti-microbial resistance strategy have conceded the problem is so great they need a 20-year vision, with shorter action plans tied to government budget cycles.
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Aboriginal health issues more than just skin deep
By Helen Pitt
June 16, 2019 — 6.39pm
If she passes her final specialist exams which start next week, Westmead Hospital Registrar Dana Slape will become Australia's first Aboriginal dermatologist.
For the 35-year-old doctor, descendant of Darwin's Larrakia Saltwater People, the path to studying skin diseases began selling skin care products in a department store.
Despite graduating as dux of her Sydney high school, she took the advice of her year 9 careers counsellor who suggested she study education. She soon found teaching wasn't her thing, dropped out of university and sold cosmetics. After seven years and many over-the-counter conversations with customers who nurtured her doctor dream, she applied for medicine as a mature age student.
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'I choose not to suffer': Margaret's choice to be one of the first Victorians to access assisted dying
By Melissa Cunningham
June 16, 2019 — 12.00am
Margaret Radmore has spent her life watching people die.
Now, she is facing her own mortality and knows she doesn't want to endure the same pain.
The 60-year-old retired nurse, who has terminal cancer, will be one of the first Victorians to apply for new voluntary assisted dying laws to help her end her life.
In more than 40 years working in the health system, she has comforted cancer patients when they have developed liver metastasis, causing their bellies to swell and fill with fluid, when they were bedridden, and their skin turned yellow from jaundice.
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Surgery is a very costly business
- 12:00AM June 19, 2019
Recent criticism levelled at brain surgeon Charlie Teo about his fees for an operation has generated much-needed public debate about the cost of specialist healthcare in this country.
Of the $120,000 bill paid by a Perth family for complex brain tumour surgery for their 12-year-old daughter, Teo says he received $8000. The family didn’t have private health insurance and, as the surgery was not offered in the public system, they decided to self-fund the operation in a private hospital.
Most of the bill went to cover the cost of the stay in the private hospital where the surgery was performed; state-of-art medical equipment for the sensitive operation; other specialists such as anaesthetists; and implants such as shunts and drains.
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Why the Pharmacy Guild is the most powerful lobby group you've never heard of
It's been called the most influential lobby group in Australia, and some believe it has the power to bring down a government if it really flexed its muscle.
It has nothing to do with miners, banks, the gambling industry or the church — in fact, there's a good chance you've never heard of it before.
The Pharmacy Guild represents pharmacist-owners, so businesses in every community (and every electorate).
And it's very good at getting what it wants.
It has achieved restrictions and laws that effectively shield its members from competition — it's why we don't have pharmacies in our supermarkets, and why you never see two pharmacies very close together.
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Third major Sydney hospital unit banned from training junior doctors
By Kate Aubusson
June 20, 2019 — 12.00am
St George Hospital's intensive care unit has been barred from training junior doctors amid protracted allegations of bullying and dysfunction among senior staff.
It is the third damning case of a major Sydney hospital unit banned from supervising trainees over concerns for their welfare.
The College of Intensive Care Medicine (CICM) withdrew accreditation from the South East Sydney hospital this week, following an inspection of its ICU and multiple bullying complaints.
Once the current CICM trainees finish their contract periods, the ICU will need to find ways to cover shifts vacated by the trainees, such as relying on unaccredited junior doctors, anaesthesia registrars, and locum specialists.
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Australia's Top 3 healthcare monopolies
Warren Buffett has said ‘In business, I look for economic castles protected by unbreachable moats’. In analyst-speak, this investing titan is referring to something known as a ‘sustainable competitive advantage’ – a quality of the business that protects it from competition.
Moats come in many forms and they aren’t always easy to measure. But their strength does tend to correlate with one factor: market dominance. There’s no better demonstration of strength than being able to knock out competitors so that you have more and more of the playing field to yourself.
In many ways, you could argue Australia is the ‘land of monopolies’ – or oligopolies to be precise. Banks, groceries, shopping centres, hardware, and toll roads all spring to mind. The healthcare sector, in particular, is loaded with them.
Healthcare companies often have strong competitive advantages, patent protection, economies of scale, high returns on capital and non-discretionary revenue. Those features mean that several healthcare niches have cascaded towards a few firms controlling the field.
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Medicare watchdog review: PSR urged to be more ‘up front’
- 12:00AM June 22, 2019
The Medicare watchdog is set to be given greater say over what doctors can and cannot claim as the federal government improves the links between compliance and reform.
A review of the Professional Services Review, which takes referrals from Medicare and decides the fate of doctors accused of inappropriate billing, found it needed to be involved more upfront.
After conducting the review, Ernst and Young argued that the “PSR could be better informed of the number of future cases and targeted specialist areas through greater exposure to Department of Health compliance strategies”.
“Additionally, there is further opportunity for improved health system compliance outcomes through leveraging PSR’s expertise upfront in the review of Medicare items, and better co-ordination of education-related strategy and activities between the
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Shops full of vitamins, miracle pills 'trashing pharmacists' reputation'
By Liam Mannix
June 22, 2019 — 12.55pm
The transformation of pharmacies into shopfronts for homoeopathy, vitamins and non-evidence-based remedies is trashing the profession's reputation, doctors, experts and even some pharmacists fear.
A page from the Chemist Warehouse catalogue showing the enormous amount of heavily-advertised vitamins, diet pills, supplements and cold and flu remedies.
The Pharmaceutical Society of Australia has also admitted that stocking complementary medicines in pharmacies leads the general public to think they are safe and effective – even when they aren't.
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International Issues.
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Trump stokes fear of market meltdown in pitch for re-election
Ros Krasny
Jun 16, 2019 — 1.30pm
Washington |President Donald Trump, gearing up for the official start of his 2020 campaign, warned that the United States would face an epic stock market crash if he's not re-elected.
"If anyone but me takes over," Mr Trump told his 61 million Twitter followers on Saturday, "there will be a Market Crash the likes of which has not been seen before!"
Mr Trump officially starts his 2020 campaign on Tuesday with a rally in Orlando, Florida, and appears to be road-testing some of the themes he'll be touching on in the next 18 months, including stoking fear of a market meltdown. "Tuesday will be a Big Crowd and Big Day," he said in another tweet.
The president has claimed several times this year and as recently as Friday in a "Fox & Friends" interview that the US stock market would be 5,000 to 10,000 points higher if the Federal Reserve hadn't raised interest rates four times in 2018.
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Trump says supporters might 'demand' he serve more than two terms as president
By Felicia Sonmez
June 17, 2019 — 9.48am
Washington: President Donald Trump on Sunday floated the possibility of staying in office longer than two terms, suggesting in a morning tweet that his supporters might "demand that I stay longer."
The President has previously joked about serving more than two terms as president, including at an event in April where he told a crowd that he might remain in the Oval Office "at least for 10 or 14 years."
The 22nd Amendment of the constitution limits the presidency to two terms.
In tweets Sunday morning, Trump also voiced dissatisfaction with recent news coverage of his administration, calling both The Washington Post and The New York Times "the Enemy of the People."
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Hong Kong's status as a financial powerhouse is under threat - and the world could suffer
By Ambrose Evans-Pritchard
June 17, 2019 — 10.31am
Hong Kong's survival as a global financial hub can no longer be taken for granted. The extradition battle being fought out on the streets of Wan Chai is inextricably tied to the larger Sino-US struggle for superpower hegemony.
The more that Beijing chips away at Hong Kong's civil liberties and autonomy, the more certain it is that Washington will strip the enclave of its special status.
Once this line is crossed, the US will cease to recognise the territory as an independent member of the World Trade Organisation. It will cut off access to sensitive technologies. Hong Kong will be subject to the same painful tariffs faced by exporters from mainland China.
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https://www.afr.com/news/world/asia/hong-kong-taiwan-and-the-hope-for-a-better-china-20190617-p51yd5
Hong Kong, Taiwan and the hope for a better China
Gideon Rachman
Jun 17, 2019 — 9.35am
Nothing better captures the difference between Hong Kong and mainland China than the annual commemoration of the Tiananmen Square massacre that takes place on June 4 every year in Hong Kong’s Victoria Park.
In mainland China the memory of the crushing of the pro-democracy movement in 1989 is ruthlessly suppressed. But Hong Kong has been allowed to continue to mark the anniversary. That kind of freedom matters not just to the 7.4 million inhabitants of Hong Kong. Potentially, it is also of great importance to the future of China itself.
Put simply, Hong Kong is acting as a guardian of China’s memory and of the hope that a more liberal China could one day replace the current one-party state. The “one country, two systems” arrangement put in place when Britain handed Hong Kong back to China in 1997 has allowed the territory to continue to preserve vital freedoms, such as an independent judiciary and a free press.
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Trump is afraid he'll lose re-election - and he's in a fury
Donald Trump's inability to acknowledge his own poor polling results shows how far he is willing to go to create the false impression that he is "winning".
Greg Sargent
Jun 18, 2019 — 2.04am
It's fairly standard stuff for campaigns to project outward confidence, to keep supporters energised. But President Donald Trump and his propagandists often go to extraordinary lengths to create the almost cult-like illusion that he is winning everywhere, possesses total mastery of events, and wields absolute dominance over his foes.
This leads to all manner of absurdities: Trump insists he's taking fearsome actions against enemies he isn't actually taking, blames the media for fabricating polls that accurately depict his deep unpopularity, and even pretends large protests greeting him abroad simply never happened.
We are now learning that Trump's re-election campaign is cutting ties with several of his pollsters, because word leaked that his internal polling shows his reelection prospects to be far grimmer than the campaign's spin suggests.
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Time to stop the pirates of Tehran
Jun 19, 2019 — 7.54am
On April 14, 1988, the USS Samuel B. Roberts, a frigate, hit an Iranian naval mine while sailing in the Persian Gulf. The explosion injured 10 of her crew and nearly sank the ship.
Four days later, the US Navy destroyed half the Iranian fleet in a matter of hours. Iran did not molest the Navy or international shipping for many years thereafter.
Now that's changed. Iran's piratical regime is back yet again to its piratical ways.
Or so it seems, based on a detailed timeline of Thursday's attacks on two tankers in the Gulf of Oman provided by the US Central Command, including a surveillance video of one of Iran's Revolutionary Guard patrol boats removing an unexploded limpet mine from the hull of one of the damaged tankers.
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US and Iran move closer to flashpoint as tensions spike
Matthew Lee
Jun 18, 2019 — 12.09pm
Washington | The US and Iran edged toward a flashpoint on Tuesday (AEST) as Tehran announced it was breaking compliance with the accord that keeps it from making nuclear weapons and the Trump administration followed by ordering 1000 more troops to the Middle East.
The Pentagon said the deployment included security forces and troops for additional surveillance and intelligence gathering in the region. While the number is small, it represents an escalation of US military might aimed at deterring Iran and calming allies worried that transit through key shipping lanes could be in jeopardy.
Tehran's announcement earlier means it could soon start to enrich uranium to just a step away from weapons-grade levels, challenging President Donald Trump's assurances to allies that the US withdrawal from the deal last year made the world a safer place.
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Fed sees clouds ahead but keeps its powder dry
Jun 20, 2019 — 4.03am
Washington | The Fed has stoked speculation it's willing to cut interest rates for the first time since the global financial crisis, while keep its options open for now if there's a trade war breakthrough at this month's G20.
Citing a rise in "uncertainties" in the economic outlook, chairman Jerome Powell and his open market committee colleagues left the benchmark interest rate target unchanged at 2.25 per cent to 2.5 per cent and dropped a previous reference to being "patient" on borrowing costs.
"We want to see and react to developments and trends that are sustained, that are genuine, and not just react to data points or just to changes in sentiment, which can be quite volatile," Mr Powell told reporters on Wednesday (Thursday AEST).
Traders now see about a 60 per cent chance that the Fed will cut its policy rate three times by the end of the year, ending it at below 1.75 per cent.
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Trump may be gearing up for a currency war
Shawn Donnan
Jun 20, 2019 — 10.42am
Washington | President Donald Trump has already given the global economy trade wars. Now there are signs he may be gearing up for a currency war, too.
With a series of tweets on Tuesday (Wednesday AEST) aimed at the European Central Bank and an announcement by Mario Draghi, its president, that he was prepared to cut interest rates further below zero in response to Europe's slowing growth, Trump made a rare American presidential intervention into another economy's monetary policy.
"Mario Draghi just announced more stimulus could come, which immediately dropped the Euro against the Dollar, making it unfairly easier for them to compete against the USA. They have been getting away with this for years, along with China and others,'' he tweeted. Later, he added: "German DAX way up due to stimulus remarks from Mario Draghi. Very unfair to the United States!''
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Khashoggi's murder premeditated, UN investigator says
Edith Lederer and Suzan Fraser
Jun 20, 2019 — 7.57am
Geneva | The gathering on the second floor of the Saudi consulate featured an unlikely collection: a forensic doctor, intelligence and security officers, agents of the crown prince's office. As they waited for their target to arrive, one asked how they would carry out the body.
Not to worry, the doctor said: "Joints will be separated. It is not a problem," he assured. "If we take plastic bags and cut it into pieces, it will be finished. We will wrap each of them."
Their prey, Saudi journalist Jamal Khashoggi, would not leave the consulate in Istanbul alive. And on Wednesday, more than eight months after his death, a UN special rapporteur revealed new details of the slaying - part of a report that insisted there was "credible evidence" to warrant further investigation and financial sanctions against Saudi Crown Prince Mohammed bin Salman.
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Why a currency war is the next phase of global conflict
As the global economy falters we are entering the next phase of currency warfare. There is going to be an ugly fight for scarce global demand.
Ambrose Evans-Pritchard
Jun 21, 2019 — 9.29am
London | Europe has been warned. Any use of monetary tools to hold down the euro exchange rate will be deemed a provocation by the Trump administration.
Further cuts in interest rates to minus 0.5 per cent or beyond will be scrutinised for currency manipulation. A revival of quantitative easing will be considered a devaluation policy in disguise, as indeed it is since the money leaks out into global securities and depresses the euro.
The Bank for International Settlements says €300 billion of Europe's QE funding reached London alone between 2014 and 2017.
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Iran claims to have shot down a 'spy' US drone
By Aya Batrawy
Updated June 20, 2019 — 6.02pmfirst published at 1.23pm
Tehran: A drone take-down and a series of attacks on oil tankers in the Gulf of Oman have racheted up tensions between the US and Iran - and raised fears over the safety of one of Asia's most vital energy trade routes, where about a fifth of the world's oil passes through its narrowest at the Strait of Hormuz.
The attacks have jolted the shipping industry, with some of the 2000 companies operating ships in the region on high alert and ordering their vessels to transit the strait only during the daylight hours and at high speed.
Yesterday Iran’s elite Revolutionary Guards said they shot down an American spy drone in its air space. The US confirmed the drone went down but disagreed with its location.
The Guard’s news website Sepah News said it was shot down over the southern province of Hormozgan which borders the Gulf of Oman.
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Tehran pushed to the brink, but it won't yield to crude US pressure
Tony Walker
Columnist and award-winning foreign correspondent
June 19, 2019 — 1.33pm
On any given day, more than 17 million barrels of oil pass through what is known as the world's most important chokepoint.
Those barrels constitute about 20 per cent, give or take a few percentage points, of world oil consumption daily.
The waterway in question is the Strait of Hormuz at the entrance to the Arabian Gulf to the north. It is 33 kilometres wide at its narrowest – where its "chokepoint" shipping lane measures just 3km across.
This is barely enough space for supertankers to pass.
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Trump says Iran made 'big mistake' shooting down US drone
June 21, 2019 — 1.28am
Washington: President Donald Trump warned on Thursday that Iran "made a very big mistake" after the Islamic Republic claimed responsibility for shooting down an American drone, further ratcheting up a week of heightened tensions between Washington and Tehran.
But he later suggested it was an error by an individual who was "loose and stupid" and he declined to detail any potential US response.
"I would imagine it was a general or somebody who made a mistake by shooting that drone down," Trump said during an Oval Office meeting with Canadian Prime Minister Justin Trudeau. "I find it hard to believe it was intentional. It could have been somebody who was loose and stupid."
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Xi Jinping presses economic theme in Pyongyang speech
Hyung-jin Kim, Kim Tong-hyung, Mari Yamaguchi and Christopher Bodeen
Jun 21, 2019 — 4.24pm
Seoul/Tokyo/Beijing | Chinese President Xi Jinping offered encouragement for North Korea's new focus on economic development in a speech in Pyongyang, turning to a topic Beijing has long pressed with its communist neighbour, amid wider concerns over the North's nuclear weapons program.
In an address at a banquet on Thursday night, Mr Xi noted that the nation under leader Kim Jong-un had "initiated a new strategic line of economic development and improving people's livelihoods, raising socialist construction in the country to a new high tide", according to China's official Xinhua News Agency.
Xi Jinping, right, and Kim Jong-un attended a dinner reception and a mass games performance on Thursday. Xinhua
The North's long-moribund economy has shown some recent improvements, but it remains heavily dependent on aid - mainly from China - and food security is a constant concern. China has agreed to UN economic sanctions over the North's nuclear and missile programs but is wary of any measures that could push its economy toward collapse, potentially unleashing instability and chaos on its border.
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What ‘Chernobyl’ teaches us about Trump
Both the Soviet system and the US president's base of true believers show what happens when the lies take over.
Bret Stephens
Jun 22, 2019 — 12.00am
I binge-watched HBO's Chernobyl this week. It made me think of Donald Trump.
No, my Trump Derangement Syndrome has not spiked to 12,000 roentgen on the ideological dosimeter. And no, I don't think of the Trump administration as an open-air, nuclear-reactor fire. To watch Chernobyl (and read nonfictionalised accounts of the tragedy) is to be reminded that such similes should be used sparingly.
But there's one striking parallel. Chernobyl isn't just a story about an environmental catastrophe, or the personal heroics that prevented it from becoming even worse. It illustrates what happens to societies corrupted by the institutionalisation of lies and the concomitant destruction of trust.
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Trump blacklists five more Chinese companies days before crucial summit
By Jenny Leonard and Shawn Donnan
June 22, 2019 — 9.13am
The US put five more Chinese tech entities on a trade blacklist just days ahead of a high-stakes summit between President Donald Trump and Chinese leader Xi Jinping even as it offered a quiet olive branch by postponing a potentially provocative speech.
The move on Friday to list four companies and a research institute involved in China's super-computing efforts follows the similar blacklisting of Chinese telecommunications giant Huawei Technologies last month, blocking it from buying US software and components.
The Huawei action has raised fears that a trade war launched last year is turning into a broader economic conflict focused on cutting off China from US technology while also forcing US companies to shift their supply chains out of China.
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Leaps and boundaries: The rise of China as a science superpower
By Paul Biegler
June 23, 2019 — 12.00am
Monkey A6 is not having a good time of it. The male macaque is being videoed by researchers and has retreated to the corner of his steel cage, burying his head in his hands.
The unfortunate primate is the subject of an experiment that has removed a gene called BMAL1, which makes him prone to the monkey version of human psychiatric disorders, including depression and anxiety.
Is China breaking ethical rules to become a science superpower? And might the West need to relax its own rules to keep up?
“Monkey A6 exhibited particularly strong fear and anxiety, showing clear avoidance of the care personnel,” reports an article detailing the experiment.
The study, published by Chinese researchers in January, has two features that are putting Chinese science in the spotlight like never before.
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Iran executes ‘defence contractor’ over spying as Trump vows new sanctions and keeps military strike option open
Iran has executed a ministry contractor for spying for the US as tensions between the two countries escalate and Donald Trump threatens.
AFP, AP
News Corp Australia Network June 23, 20197:28am
US President Donald Trump says he will impose additional sanctions on Iran in an effort to prevent Tehran from obtaining nuclear weapons, adding that military action was still a possibility.
Mr Trump made his comments after recently calling off military action against Iran to retaliate for the downing of a US military drone.
“We are putting additional sanctions on Iran,” Mr Trump said. “In some cases we are going slowly, but in other cases we are moving rapidly.”
The president said military action “is always on the table” against Iran. But Trump also indicated he was open to reversing the escalation, adding he was willing to quickly reach a deal with Iran that he said would bolster the country’s flagging economy.
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I look forward to comments on all this!
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David.
