Markets Require Regulators Not Watchdogs
Markets require regulators. As Adam Smith, the champion of the invisible hand, notes in The Wealth of Nations, when individual interests are left unregulated they work to turn competitive markets into monopolies. But what happens when regulators meant to check individual interests fail to promote the public interest? Consider Australia’s banking sector. The banking royal commission has…
New Silver Bull Coming?
Silver has been dead money over the past year or so, relentlessly grinding sideways to lower. That weak price action has naturally left this classic alternative investment deeply out of favor. Silver is extremely undervalued relative to gold, while speculators’ silver-futures positions are extraordinarily bearish. All this has created the perfect breeding ground to birth…
RBA rates decision stuck between jobs growth and household debt
Is the Reserve Bank of Australia’s monetary policy on a collision course with itself? Quite possibly. The key data and evidence this week were employment figures in Australia, retail sales in the United States, and minutes from the Reserve Bank of Australia board and US Federal Open Market Committee (FOMC). First, the data. ABS figures…
5 government debt myths
Summary As we approach a rising rate environment, the scale of U.S. federal debt has some investors concerned about the sustainability of government finances in the coming years. In this bulletin we consider the most common myths about the government’s debt and discuss how investors can position their portfolios to withstand what we believe are manageable…
Now Is The Time To Fight The Next Recession
This is part of a major series called Advancing Australia, in which leading academics examine the key issues facing Australia in the lead-up to the 2019 federal election and beyond. Australia’s nearly three decades of uninterrupted economic growth won’t last forever. Sooner or later policymakers will need to respond to a downturn that could come…
Gold bullion or gold equities?
Financial-market turmoil is strengthening the case to add gold exposure to portfolios as more “insurance” in the event of a sharper equities market sell-off. It is also providing an opportunity to capitalise on the precious metal’s improving medium-term prospects. Gold’s role as a ‘safe-haven’ has come to fore this year. The US-dollar gold price has…
The Federal Reserve: How does it work?
The US Federal Reserve is subject to intense scrutiny by governments and investors worldwide since its decisions can ripple throughout the global economy. But how does it really work? Dual mandate The Fed was created on December 23, 1913 under President Woodrow Wilson. Unlike most central banks, such as the European Central Bank, that focus…
The Market Is Toast. Protect Your Assets
The trader who became an internet sensation with his outburst on BBC television – declaring that “the market is toast” and that the smart money is moving its assets to safer investments like treasury bonds – has become an instant enemy of the corporate media. His views on the global financial crisis were belittled as…
3 ways to benefit from backdoor listings boom
The backdoor listings market on ASX is equal parts fascinating and frustrating. Fascinating because some promising technology companies are listing through the shell of failed miners. Frustrating because there is less information about upcoming listings. A backdoor listing typically involves a dormant listed company acquiring the shares or assets of an unlisted company, after shareholder…
The Outlook for Aged Care Operators
What could be better than investing in a sector with typhoon proportion tailwinds at its back, with something approaching 70% of revenue stemming from the federal government? In 2014 three ASX stocks listed, all operating in that sector – care of Australia’s aging population. Japara Healthcare (JHC) was first out of the gate in March,…
