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Plunging Australian Jobs Send Japan Equities... Soaring

Tyler Durden's picture




 

Earlier today we showed that even the big banks are officially throwing in the towel on the "artificial market" when Deutsche's Jim Reid summarized the complete insanity of Bernanke's (because it still is his) centrally-planned new normal as follows. "So far this year markets have gone down on good data, gone up on good data, gone down on concerns over weaker data and also gone up on weaker data." Now we can add yet another item to the list of explanations that will send futures higher: a plunge in Australian job numbers. Moments ago, Australia reported that in December employment fell by a jarring 22,600 jobs on expectations of a 10,000 gain, driven by a 31,600 plunge in full-time jobs offset by an increase in 9,000 part-time jobs (do they have Obamacare in Australia too?).

Well, as one can assume the immediate reaction in the Aussia dollar (AUD) was not good, as this latest data increased the odds of an RBA rate cut, and confirmed that the Chinese economic slowdown is indeed having major spillover effects on derivative economies. And sure enough, the AUDUSD tumbled by nearly 100 pips to 0.8825 from levels earlier in the session.

That much was expoected. What made zero sense was the offsetting reaction in the completely unrelated USDJPY pair. Because while the news for Australia was declidedly negative, somehow the offsetting reaction to some algo somewhere, was to send the USDJPY soaring.

And since as everyone knows, equity markets are now nothing but a derivative of the Yen-carry trade, the Nikkei (green line in chart above), promptly exploded higher. Whether this is on the expectation that the Bank of Japan will somehow print more Yen because jobs in Australia are cratering, or "just because" nobody knows. And frankly nobody cares. Point being: we are once again back to the old regime where good news is great for stocks, but bad news is better.

Finally, since the US algo army will shortly pick up the baton from Japan in a few hours, look for the S&P futures to soar to new record highs on, what else,  a crashing and burning Australian economy.

"#Ref! - it's the New Normal"

 

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Wed, 01/15/2014 - 21:04 | 4336115 Occams_Chainsaw
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Maybe they can offer the Aussie's a deal on Fukoshima waste storage......

Wed, 01/15/2014 - 21:27 | 4336197 Dr Benway
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And in completely unrelated news, for the first time, the pension fund embezzlers I have been exposing pressured google with legal threats to remove one of my posts.

http://www.drbenway.blogspot.com.au

The post detailed how Avestra asset management was involved in the "Formosa auto trade" scam a few years back. Flyers were handed out selling magical laptops with auto-trading software that yielded profits of hundreds of percent, if only you stumped up 30 grand up front. More recently Avestra gained control of AG Financial (AHA.AX) and engaged in a circular investment scam to embezzle the pension funds managed by the company.

Wed, 01/15/2014 - 21:45 | 4336259 The_Prisoner
The_Prisoner's picture

Keep at it, Dr.

When I came to Australia a few years ago I was startled by the number of conmen in the business community. I mean, it is a line that is often blurred, but at least in other parts of the world they seem to maintain the appearance of respectability. But in Oz it's all in the open, and you have cats involved in the ABC Learning Centres getting the Medal of The Order Of Australia.

And What happened to Emmanuel Cassimatis of Storm Financial? It's a disgrace.

 

Wed, 01/15/2014 - 22:06 | 4336339 Dr Benway
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Thanks, Prisoner. You are right, the criminals are more brazen in Australia, so arrogant they don't even bother covering their tracks. In the absence of enforcement the conmen have lost all fear.

Wed, 01/15/2014 - 22:11 | 4336358 Never One Roach
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Those truck drivers making $165k/year better have saved for a rainy day, me thinks. I suspect the Australian heart surgeons [whom ZH reported make considerably less] will still have a job as well as strong demand as obesity and triple bypass sugery needs soar.

Thu, 01/16/2014 - 01:39 | 4336974 Parrotile
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Sorry, they prefer to spend their money on big houses, big boats, big holidays, flash cars (as many as can fit into their 5-garage McMansions with waterfront views), and of course big (expensive) holidays.

Welcome to the land of "I've got Rights, Mate" mentality - everyone knows "their rights", everyone forgets that these rights come with attendant responsibilities (such as planning for YOUR Future!)

Thu, 01/16/2014 - 01:48 | 4336983 Parrotile
Parrotile's picture

Add in a good dose of Union-driven protectionism (only a "Licenced Tradesman" is legally able to do many simple things), and you've got a good recipe for a very corrupt little Country. Why do you think Mitsubishi, Ford and now GM are calling it a day and ceasing car production in Australia - I'll give you a clue - it's not because the workforce are motivated, honest and hard working (although us Aussies do like to project that particular fiction).

Wed, 01/15/2014 - 22:43 | 4336498 logicalman
logicalman's picture

Had a similar experience with YouTube - videos regarding corruption and fraud in the Canadian Banking System.

Everything suddenly dissapeared.

 

Thu, 01/16/2014 - 00:15 | 4336776 Say What Again
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Why does your blog use gray font against a white background?

Is it supposed to be "contemporary?"

Thu, 01/16/2014 - 00:26 | 4336833 Dr Benway
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It does? Hmm maybe I should change that, I just used the default template... 

Thu, 01/16/2014 - 00:53 | 4336896 JackWills
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Can someone that has lived in the USA and Australia do a quality of life comparison?  Just curious what the pluses and minuses are of living in Aussie land compared to the USA?

Wed, 01/15/2014 - 21:05 | 4336118 Barry Freed
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Bullish.

Wed, 01/15/2014 - 21:09 | 4336134 Surrealist
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As an aussie stupid enough to get into mortgage debt, this is good news! But even better news will be when the entire world economy freezes and there's a global reset.  I plan on being raptured to heaven at around the point when this historical event comes to pass. :) 

Wed, 01/15/2014 - 21:28 | 4336203 Zero Point
Zero Point's picture

My parents are putting their retirement into a property fund.

Last year I would have objected.

I just weakly nodded and went along with the prospectus.

I got nuthin left.

Wed, 01/15/2014 - 22:12 | 4336364 The_Prisoner
The_Prisoner's picture

Zero Point. check Dr Benway's blog. He does a terriffic job at exposing the scams perpetrated by the property funds in Australia.

http://drbenway.blogspot.com.au/

 

Wed, 01/15/2014 - 22:28 | 4336425 chump666
chump666's picture

The biggest scam...Re-inflating a housing market bubble while a mining boom crashes.  Pure genius that one.

Australia, Canada and New Zealand (yes them too, even with their milk export lead recovery lol) are all in deep trouble.  Especially Australia.  Get ready for Fed liquidity swap lines and bailouts ala Aussie soon...mind you Yelland is concerned about that USD, could collapse any-day

Wed, 01/15/2014 - 21:09 | 4336136 Dr. Engali
Dr. Engali's picture

Everybody in the world should just quit, and we'd all be fucking rich.

Wed, 01/15/2014 - 22:38 | 4336472 flacon
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But who would be left to tend to Queen Pelosi's botox?

Wed, 01/15/2014 - 21:13 | 4336138 fonzannoon
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This is not that difficult. Central planners have been and will continue to  use the market as a mechanism to combat the structural decline of the developed world. Everytime these numbers deteriorate expect that much more of a ramp in the markets.

Wed, 01/15/2014 - 21:11 | 4336140 Surrealist
Surrealist's picture

Oh btw we don't have Obamacare but we do have public health care called Medicare. had it since the mid-70s when the Whitlam government introduced it.

Wed, 01/15/2014 - 22:23 | 4336390 BringOnTheAsteroid
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Australia is also recovering from several years of Labour government that took the national debt from $0.00 to 200 billion, then had the audacity to reject the Liberals moves to raise the debt ceiling when they came to power. The same Labour government also rejected the previous Liberal governments Narau solution to illegal immigrants only to scrap it, resulting in a mass influx of illegal immigrants further resulting in Labour panicking and instituting a Papua New Guinea solution. Labour touted their Papua New Guinea solution as a regional solution, how Narau wasn't is beyond me. The same labour government promoted it's leader Kevin Rudd who won a landslide election swing to Labour to only sack him a couple of years later and replace him with Juila Gillard who they then sacked a couple of years later and replaced with someone else who lost then lost the election - surprise, surprise. In the end Labour provided a better opposition to Labour than Liberal.

Is it any wonder socilaists are detested. 

Thu, 01/16/2014 - 03:51 | 4337110 Mediocritas
Mediocritas's picture

Dude, you've been on ZH long enough to know there's really no difference between the red team and the blue team. Whatever CBA, NAB, ANZ and WBC want, they get.

Please slap yourself for this mistake.

Thu, 01/16/2014 - 10:49 | 4337684 monkeyboy
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Indeed.

 

Got me fucked how someone can tell the difference between Labor & Liberal in Australia. All pigs @ the trough.

Wed, 01/15/2014 - 21:16 | 4336158 chump666
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Yeah Japan is just topping sh*t all over the place:

http://www.reuters.com/article/2014/01/14/japan-economy-current-idUSL3N0...

Nakatomi style Die Hard BITCHEZ

Wed, 01/15/2014 - 21:17 | 4336164 Jimbodude
Jimbodude's picture

ASX is up?

Wed, 01/15/2014 - 21:19 | 4336171 monopoly
monopoly's picture

Will this ever end. Will reality ever be center stage again. And today, even a subscription site that I belong to decided to join the fray and buy Spoos and QQQs. This after months and months of advising bubble, currency war, Fed insanity and on and on. They advise " we might as well ride this up with everyone else". He is sure we can be the first ones out the door and in a seat when the music stops. Now I have heard it all.

I think I will pass. We gotta be close to the end. No?

Wed, 01/15/2014 - 21:27 | 4336202 greatbeard
greatbeard's picture

No.

Wed, 01/15/2014 - 21:39 | 4336236 Cdad
Cdad's picture

Yes.

The train has left the tracks already.  The locomotive just hasn't hit enough shit to stop moving yet.  When it stops, bankers will be knocking over women and children to be the first off.  And they will sell at the speed of light into a vacant market.  The banks are not hoarding cash for nothing.

 

 

Thu, 01/16/2014 - 06:05 | 4337194 Seer
Seer's picture

"The banks are not hoarding cash for nothing."

It's all stacked up against the coming wave of loan defaults...  And because it's a certainty that the pendulum will swing past any equlibrium point (though what that is is starting to become nearly impossible to state) as the loan failures pile up and off-books shit starts seeing the light of day.

In the end it'll only have bought a bit of time.  The conclusion will be the same: total collapse/failure.

Wed, 01/15/2014 - 21:50 | 4336277 The_Ungrateful_Yid
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Not even close, this bull ain't done riding yet.

Wed, 01/15/2014 - 22:15 | 4336376 rubearish10
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Well, if job losses in Canada, Austraila and slowdown in US is due to China in some direct or "indirect way inclusive of Obamacare (in US too), maybe there's something "real" going on that only Old Yellen might only be able to FIX,with MOAR USD printing. Watch out for the bull trap in the US Dollar!

Wed, 01/15/2014 - 22:25 | 4336416 BringOnTheAsteroid
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Is this reality any different to the that which preceded the dot com bust or the 2008/09 GFC. We have very short memories are are definitely stuck in the present.

Thu, 01/16/2014 - 03:30 | 4337090 Aussiekiwi
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Could the people handle reality?

Wed, 01/15/2014 - 21:29 | 4336206 FredFlintstone
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"So far this year markets have gone down on good data, gone up on good data, gone down on concerns over weaker data and also gone up on weaker data."... same as ever.

Wed, 01/15/2014 - 21:38 | 4336219 darteaus
darteaus's picture

Of course equities soar: Where else can you put all that cash the world is printing?

Bills, bonds and banks don't pay jack, and you have a good chance of not getting your money back.

Commodities?  With the economy tanking, nobody is going to be using a lot of commodities.

Real Estate?  Seriously?  No decent returns there and the markets are rolling over even in Silicon Valley.

Collectibles (art, jewelry, autos, coins, watches, etc.) are fun, but you can't get much, if any, of a return there.

With equities: the price is transparent, you can cash in/out easily, and you're running with the bulls, i.e. the government wants to be able to point to a soaring equities market.

Bad news just shows the futility of putting your money in anything else because everything else is crapping out.

Wed, 01/15/2014 - 22:37 | 4336466 Cursive
Cursive's picture

@darteus

What are you going to do when equities crap out?

Wed, 01/15/2014 - 23:51 | 4336728 darteaus
darteaus's picture

Good question.

I will be keeping a low profile

Thu, 01/16/2014 - 06:12 | 4337197 Seer
Seer's picture

When equities blow out it'll pretty much be game-over, as at that point it'll be all too clear that the System can no longer work (no growth).

Wed, 01/15/2014 - 21:34 | 4336223 ltsgt1
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Is "insanity" sustainable? If it were sustainable, why would anyone invests logically? Prudent is out of fashion, money manager is so yesteryear, a crazy monkey throwing darts would likely have a better performance than most of us.

Wed, 01/15/2014 - 22:21 | 4336398 HardlyZero
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Anyone heard from Yellin' and is she holding and taming the Tapir, or has it scurried away ?

Wed, 01/15/2014 - 22:22 | 4336402 Bunga Bunga
Bunga Bunga's picture

Get over it, any real information is completely irrelevant in fascism.

Wed, 01/15/2014 - 22:47 | 4336518 mobydick
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This will be good for the property market. Nobody does spruiking like good old Oz.

Wed, 01/15/2014 - 23:00 | 4336565 nevket240
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As an Aussie Oil n Gas worker I am amazed at how stupid Government of our Country is. A lot of recruitment is going on here but not many of the good paying jobs are going to Aussies. There are not enough experienced workers around. Most of the new emeployees are from overseas. So the good pay is going to leave these shores to other countries. Result...a lot of bullshit about how the boom is good for our economy.

regards

Thu, 01/16/2014 - 06:22 | 4337202 Seer
Seer's picture

Govts AND industry are both stupid.  That is, in regards to being able to see that their futures are pretty much gone.

Those "good paying" jobs are only short-term, as eventually exports will collapse.  And, given that all is structured for growth, when economies of scale in reverse hit it'll wipe out margins and force MANY industries to fold up.

"So the good pay is going to leave these shores to other countries. Result...a lot of bullshit about how the boom is good for our economy."

How do you think things work, really?  Exports have always been key.  If you don't have folks outside of your country making sufficient incomes to purchase your exports then there's really no way, whether it's the locals making the money or not, that an export-based industry is going to continue.

With China's growth winding down their energy imports are, eventually, going to decline.  The "overseas employees" really have but a small impact in the Big Picture: but it's a handy scapegoat.

Wed, 01/15/2014 - 23:23 | 4336589 janxeh
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The main reason for the poor job numbers is that the government refused to bail out the auto industry and the GM and Ford workshops closed.

Bullish Toyota and Nissan.

In America Bullish GM and Ford.

 

Wed, 01/15/2014 - 23:27 | 4336657 elmico
elmico's picture

Wrong. Those workers won't get the sack for a couple years. Why prop up an industry that's foreign owned. If all the profits stayed here then fair enough. 

 

Thu, 01/16/2014 - 06:29 | 4337207 Seer
Seer's picture

"If all the profits stayed here then fair enough."

Can that be said ("all the profits") for anything, anywhere?

The reason why foreign companies such as the auto companies have plants in a given country is due to various trade rules that reduce competition with local companies*.  Ultimately, however, it's about whether or not the local populace presents a viable market; and, on this basis I'd have to say that this is more of an indicator of a looming downturn down-under...

* Yes, there are other issues such as cost of available energy and other resources (shipping too [closer launching point to other markets]), as well as environmental constraints (higher profits to be had if you can freely trash the environment).

Thu, 01/16/2014 - 02:13 | 4337014 Parrotile
Parrotile's picture

There were interesting rumours that one of the Chinese Carmakers were interested in acquiring the Broadmeadows Holden plant - 

http://www.news.com.au/finance/business/holden-factory-should-be-sold-to-the-chinese-expert/story-fnda1bsz-1226717216719 

Things on this particular front have gone surprisingly quiet, but it is of relevance that the next "Holden Commodore" may well be the same car as is marketed as a Buick in China - and will be made in the same Chinese plant, but with a Holden grille badge.

http://www.carsguide.com.au/news-and-reviews/car-news/now_for_the_holden_commodore_from_china_20131213_79790

Wed, 01/15/2014 - 23:20 | 4336635 Yen Cross
Yen Cross's picture

    I'll say one thing. The usd/jpy has not retraced on the hourly chart for over 48 hours, and the trade is extremely overbought. If I was long I would start taking some profit before those jobs numbers roll in. If it sells off all those stops on the way up are going to get blown out in epic fashion.

    I would say some additional taper is now mostly priced in so the risk is to the downside.

Wed, 01/15/2014 - 23:38 | 4336693 sadmamapatriot
sadmamapatriot's picture

But, but, ... I thought Australia's economy was good because of their crazy high minimum wage? LOL!!!

 

BTW, I had a total freak out earlier when the Zero Hedge site was down. I thought the CIA, NSA, and the rest of the alphabet soup got us!

Thu, 01/16/2014 - 03:15 | 4337074 Aussiekiwi
Aussiekiwi's picture

It has been a good ride, but like the rest of the western world we have way too much immigration so when things start to slow we start to hurt, I have been watching the employment situation deteriorate over the last 12 months in the real world here in aussie, finally the stats are catching up. At least we can shoot Roo's when we need meat. 

Thu, 01/16/2014 - 06:35 | 4337212 Seer
Seer's picture

"It has been a good ride, but like the rest of the western world we have way too much immigration so when things start to slow we start to hurt"

Had to have a lot of 'em to wipe your asses...

Years ago the brilliant xenophobic morons in govt had the policy to promote higher birthrates for the "whites" in order to stem the Asian Tide.  Really, how does skin color make a difference when it all comes down to an issue of an environment that's over-populated? (Australia is so far past carrying capacity that it's not even funny)

"At least we can shoot Roo's when we need meat."

I've got gobs of deer around me, but I in no way pretend that they would survive when everyone starts to become hungry... they'll likley be wiped out in a short order.

Thu, 01/16/2014 - 00:06 | 4336778 savagegoose
savagegoose's picture

i think this round of job loss, is  mainly ex public service, the new gov just laid off

Thu, 01/16/2014 - 02:25 | 4337027 yepyep
yepyep's picture

The Australian population is deep deep asleep.

they think the RBA are genius's because they dodged the brunt of the 2008 recession.

they are going to get their dose of medicine very soon, the housing market there is an incredible bubble.

http://freekoolaid.com/

 

Thu, 01/16/2014 - 03:09 | 4337071 Aussiekiwi
Aussiekiwi's picture

but...but....China?

Thu, 01/16/2014 - 03:20 | 4337081 Aussiekiwi
Aussiekiwi's picture

At least we have a housing bubble to keep us going, after all we all know housing doubles every 10 years...or is tha 7.

Thu, 01/16/2014 - 06:38 | 4337213 Seer
Seer's picture

Can Australia really be that much worse than Canada?

I'm wondering which (Australia or Canada) is going to finally catch the (down) arrow first.  Seems like a pretty tight race: latest employment numbers in Canada took a big tumble.

Thu, 01/16/2014 - 06:15 | 4337198 q99x2
q99x2's picture

Austrailians don't need to be having jobs since they started paying carbon taxes.

Thu, 01/16/2014 - 06:23 | 4337203 wednesdayfan
wednesdayfan's picture

Nobody in Oz saved a thing because up until about a year ago the government were telling everyone that they had escaped the GFC unscathed and that good times would go on FOREVER !! . Its slowly dawning now on some which is way the liberals just got in.

Thu, 01/16/2014 - 08:17 | 4337294 BigSimes
BigSimes's picture

Australia is a boom and bust country, just like the weather patterns. I grew up there.

I am eagerly anticipating a re-set, but have hedged by re-catching the falling knife of under-valued Junior Gold & Silver Miners.

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