Bank of Australia Hikes Rates

rffrydr · Posted: Wed Nov 08, 2006 8:30 am Post subject: Bank of Australia Hikes Rates

Bummer on the metals. Record leveraged Aussie "selling on fact."
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rffrydr · Posted: Tue Oct 20, 2009 10:27 am Post subject:

Burn't my fingers many times with chicken options on this trade and managed to make squat in greatest financial implosion of our lifetimes. Nothing is Obvious.

The floating nature of aussie mortgages and G20 signaling pressure seems to be behind this hike and concomitant "stabilizing" of home prices at 2X historic income ratios!

But, for the short, it's clearly a china play now. Why not go to the source? Imagine the possiblities. Iron ore is an issue again, "the supply side gets rich while the demand side looses money" they say. Could get interesting.

Australia
Published: September 2 2009 09:32 | Last updated: September 2 2009 22:56

They don’t call it the lucky country for nothing. Not only did Australia dodge a technical recession by posting first-quarter growth, its second-quarter number – a 0.6 per cent expansion of the economy – is about double most estimates. But Wayne Swan, treasurer, chuckling on Wednesday about defying gravity, should not congratulate himself or his colleagues on any staggering strokes of genius.

The first key component of recovery – aggressive monetary easing, taking interest rates to a 49-year low – replicated moves seen round the world. Ditto tax cuts and cash handouts, which took the sting out of the consumption shock. Additional fiscal stimulus should result in the largest budget deficit on record this year, but it is the previous government that deserves plaudits for running a surplus in the first place.

Credit for the second component – a solid banking system – belongs in large part to Treasurer Paul Keating instituting the so-called “Four Pillars” policy in 1990. Shielded from takeover, the banks have never needed to crank up the riskometer. Structured finance exposures are small, relative to international peers, as are overseas interests: the big four have a 10th of their assets, on average, outside Australia and New Zealand. The property sector, underpinned by stable lenders swiftly passing on rate cuts, has wobbled but not yet fallen over.

Third, and perhaps most critical, is Australia’s relationship with China, now vying with Japan as its most important two-way trading partner. As China’s preferred supplier of rocks and crops, Australia has piggybacked off a stimulus package roughly nine times bigger than its own.

It is not, however, a sure bet that interest rates will be raised. Unemployment, real incomes, the current account deficit and terms of trade are all heading in the wrong direction. Downward revisions of Wednesday’s growth figure are possible. Still, if any government can justify a spring in its step, it is Australia’s
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diesel · Posted: Mon Oct 19, 2009 3:51 pm Post subject:

I think Australia will be a short to look at going forward. Australia/New Zealand both have massive current account deficits, there banks are selling debt in $USD, both have massive housing bubbles and are recipients of the $USD carry trade. I wouldn't be surprised to see new lows in the $AUD/$USD cross sometime in the next year. Only playing this scenario indirectly at the moment FWIW.

Could be the next Iceland.... Latvia etc..
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rffrydr · Posted: Tue Oct 06, 2009 11:11 am Post subject:

First of the G20 (behind Israel), perhaps a G20 "collusion." Aussie trade figures flat but having a mortgage market that float and going in with employment scarcitythe US equivalent job loss in the cycle is a mere 500000.

http://media.bloomberg.com/bb/avfile/Economics/On_Economy/v6V2yVLtlXLY.mp3

Definitely not the short I was looking for back last year--barely broke even on aussie buck. But as china buys the country out wholesale will be trading this place like shanghai sooner than later.
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HenryTo · Posted: Tue Oct 06, 2009 9:38 am Post subject:

Reserve Bank of Australia unexpectedly raises rates. Only one out of 20 analysts had predicted the move:

http://www.bloomberg.com/apps/news?pid=20601081&sid=aH9_Kjmk1laM

rffrydr · Posted: Tue May 08, 2007 10:10 am Post subject:

Qantas takeoever flops. 45% of float held by Hedge Funds:

http://www.ft.com/cms/s/092841b4-fd49-11db-8d62-000b5df10621.html
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rffrydr · Posted: Mon Mar 19, 2007 7:00 pm Post subject:

Hey, Arco:

Good call on the aussie. Used to the 500pts down Nikkei that barely touched this spread to get out little better than flat. Will be looking at your triangle picking my next point down the line.

Captial MEETS Labor in PE deal:

http://www.smh.com.au/news/National/Qantas-takeover-faces-more-challenges/2007/03/20/1174152978654.html

Brtian's Salisbury Union head asked where labor stood inthe PE order of priorities responded that there "was no order." Prioties are "profit, profit, profit..." How we've strayed from the Blackstone mantra, "bland companies doing bland business."
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rffrydr · Posted: Sat Dec 09, 2006 1:40 pm Post subject:

Upthrust out of distribution: looks to follow CRB by my call. We won't see 80 until we see 2 GBP.

As noted before, Telstra and it's 7+ dividend has been driving this last phase, attracting Yen like flies. Like all bubbles hOw much more this "investment" is than meets the eye.

http://www.theaustralian.news.com.au/story/0,20867,20895888-643,00.html

HenryTo · Posted: Tue Dec 05, 2006 11:39 pm Post subject:

Arco,

Very nice work. Like rffrydr said, we got your target and then some. Do you have any new price targets now?

It now looks like the Reserve Bank of Australia may be done for awhile. GDP growth for the third quarter of 2006 came in lower-than-expected. Inflation should calm down next year as the economy slows and as the crop yields recover next year:

http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=aOwQZhiFp.X4

Best,

Henry

rffrydr · Posted: Tue Nov 28, 2006 3:05 pm Post subject:

We got your target and then some. Any more. Last time the postiioning was this imabalnceed was once in ten years, March 05. A mared turn followed then. That it was last year shouldn't be a surprise, I gueess. 7 straight weeks with this heavy leaning on the buy side. On a measured move this is my target. Anything more, gotta bail.

Ford unsecured bonds, unlike qantas, registered barely a blip on the scale--in contrast to qantas.

rffrydr · Posted: Mon Nov 27, 2006 7:44 pm Post subject:

Here's the story:

http://www.bloomberg.com/apps/news?pid=20601009&sid=aQLzG14JJag4&refer=bond

But it's the ISSUE that prompted my tentative short of BCA a few weeks back, and outright short on monday....and immediate bearish market outlook. --though the sharp moves are usually the wrong moves.

It's been mentioned here earlier in the year the MA discussions here on the board. And more generally:

http://www.marketthoughts.com/forum/viewtopic.php?t=145&highlight=buyouts+debt+credit

http://www.marketthoughts.com/forum/viewtopic.php?t=220&highlight=buyouts+debt+credit

The snake may be biting its own tail.
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rffrydr · Posted: Mon Nov 27, 2006 4:25 pm Post subject:

Quantas default spreads worst of the worst today. One of the big acquistion stories pushing the AD recently.
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arco · Newbie Joined: 19 Oct 2006 Posts: 13 Location: New Zealand

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Hello rffrydr

Yes, only 23 pips from my target suggested early October, and it looks like it could still do a bit more.

regards - arco

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rffrydr · Posted: Fri Nov 24, 2006 10:30 am Post subject:

And the Technicals have it!

Carry push came not from the yen but the euro--as no-one believes, and some officials state outright, that Yen is going to attract much PBOC diversification. Despite Russia going in 2 weeks back.

It's trading, i think though, is mostly push from strength in the crosses. Tends to balance over a week or so. Got stopped out on half friday, we'll see on the other half. So I do have a biased position on this one.
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arco · Newbie Joined: 19 Oct 2006 Posts: 13 Location: New Zealand

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Hello rffrydr

rffrydr · Posted: Sun Nov 12, 2006 1:47 pm Post subject:

Assuming it's even going down yet--I dunno, probably higher than I expect given a long-term bullish commodity outlook and slowwwwly recovering Japan. The measure of the head? Somewhere in your cloud of support. Just hope I know it when when I see it.

How much of the auto-slowdown do you attribute to just unattractive models vs. consumer slowdown?