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Aussie Dollar Tumbles As Stevens Says "Overvalued"; Claims "Not Jawboning"

Tyler Durden's picture




 

It appears it's one of those nights. In a fit of confusion, Australia's Central Bank head Glenn Stevens declared "investors are under-estimating the chance of an AUD decline" only to follow that 'jawboning' up with an explanation that he is trying "to avoid shifting language or jawboning." But then he broke the cardinal rule of central-banking - he told the truth:

  • *STEVENS: PEOPLE SHOULDN'T ASSUME HOUSE PRICES ALWAYS RISE

But.. but.. but... Ben Bernanke said... The AUD plunged over 50 pips on the news (but like any good central bank non-jawbone is suffering from a short half-life).

 

 

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Wed, 07/02/2014 - 21:18 | 4919904 buzzsaw99
buzzsaw99's picture

he later said rates were too damned low and japanese infestors should gtfo.

Wed, 07/02/2014 - 21:32 | 4919933 Dr Benway
Dr Benway's picture

He created one of the most bloated housing bubbles in the world, destroying the future of Australia. Now he tries to jawbone and bonersmoke his way out of accountability. The gall.

Meanwhile, his board openly accepts bribes in the form of directorships with criminal organizations. It turns the stomach.

http://drbenway.blogspot.com/ncr

Wed, 07/02/2014 - 21:34 | 4919942 BeetleBailey
BeetleBailey's picture

Hey Doc...what's your take on the Aussie?

Wed, 07/02/2014 - 21:42 | 4919979 Dr Benway
Dr Benway's picture

Longterm? The grotesque Sino-Australian housing bubble is teetering on the brink of implosion like a swollen corpse fished out of a river. When Australian house prices start falling, the RBA will go to any length to protect the bubble, lowering interest to zero or beyond, sending the AUD down the toilet.

Wed, 07/02/2014 - 23:43 | 4920295 BringOnTheAsteroid
BringOnTheAsteroid's picture

Surely there are some far bigger turds going through the s-bend first?

Thu, 07/03/2014 - 00:33 | 4920385 Dr Benway
Dr Benway's picture

Yes, BringOnTheAsteroid, there are more fraudulent and corrupt countries, but IMO there is no other country that is so fraudulent while having such a good reputation. The disconnect is bizarre. And Australia actively tries to monetize this, in financial services but also other areas such as education, selling its undeservedly good name for a quick buck. TPTB are actively and deliberately trying to turn Australia into an international center of financial fraud. This is why Chinese scams are falling over themselves to list on the ASX, to sport an ASIC-legitimized "market" price.

Thu, 07/03/2014 - 00:57 | 4920398 The_Prisoner
The_Prisoner's picture

Just saw this joker on the Herald talking about getting a redraw on his mortgage to buy shares, and getting the interest deducted on tax.

Except the fact it can only end in tears, it's all legal.

http://www.smh.com.au/money/planning/tricky-tax-deduction-claim-is--best-left-to-the-accountant-20140625-zslc2.html

Thu, 07/03/2014 - 00:57 | 4920423 Dr Benway
Dr Benway's picture

The author of that advice column, Noel, has previously championed buying shares on margin as a great "longterm investment strategy" for everyone, a viable strategy for society as a whole. According to him, if everyone bought shares on margin (conservatively of course), over the long term all investors would have higher returns in aggregate. So where exactly would these aggregate higher returns come from? The leatherfaced old shithead never specifies.

Thu, 07/03/2014 - 01:08 | 4920440 The_Prisoner
The_Prisoner's picture

The word circle-jerk comers to mind.

Thu, 07/03/2014 - 10:07 | 4921291 BringOnTheAsteroid
BringOnTheAsteroid's picture

The words Storm Financial come to mind. Worked with someone who lost $900,000.00 with Storm (all their superannuation).

Thu, 07/03/2014 - 21:12 | 4923531 The_Prisoner
The_Prisoner's picture

Storm Financial was a disgrace. In 07 a former co-worker was about to retire early at 55, he had reverse-mortaged his unit in Mosman under advise from Storm and leveraged it to the hilt on shares, was doing great till he lost everything. In 2010 he lost his job too.

CBA had its fingers all over the Storm Financial mess as they were originating all the margin loans. That's why the whole thing got covered up pretty quick and no one went to jail.

Emanuel Cassimatis is Australia's John Corzine.

Thu, 07/03/2014 - 07:15 | 4920815 thestarl
thestarl's picture

Exactly Doc he seems to forget Storm Financial,Babcock & Brown and a host of others that went bust in 08 doing just that the old cunt.

Thu, 07/03/2014 - 07:20 | 4920820 thestarl
thestarl's picture

Not to forget the Commonwelth Bank also those arseholes,shows you how gutless our regulators are.

Thu, 07/03/2014 - 21:04 | 4921301 BringOnTheAsteroid
BringOnTheAsteroid's picture

Bitchez

Thu, 07/03/2014 - 03:37 | 4920599 AUD
AUD's picture

no other country that is so fraudulent while having such a good reputation

The US & UK beat us hands down. The credit of the US in particular can magically turn all sorts of shit into 'money'.

 

 

Thu, 07/03/2014 - 04:54 | 4920676 BeetleBailey
BeetleBailey's picture

Much appreciated....how about this year.

Thu, 07/03/2014 - 06:17 | 4920765 Dr Benway
Dr Benway's picture

This year? Fuck I have no idea. Where the manipulators want it to perhaps?

Wed, 07/02/2014 - 21:38 | 4919962 The_Prisoner
The_Prisoner's picture

I strongly recommend Dr Benway's blog for anyone who has any money on the Australian Share Market. It helped me wake a few friends up who had money invested in LIC's.

With the end of the mining boom and the demise of industry in Australia, the government is providing cover to the banks in an effort to have Australia compete with Singapore as the Asia-Pacific money laundering haven, while screwing its own citizens. 

Wed, 07/02/2014 - 22:18 | 4920078 Dr Benway
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Thank you yet again for your kind words, The Prisoner, your support is very encouraging!

Thu, 07/03/2014 - 01:52 | 4920502 Macrosan1
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I strongly recommend that prospective investors undertake reasonable due diligence companies (including a corporate governance review), rather than rely on Chinese whispers.

Thu, 07/03/2014 - 21:17 | 4920605 The_Prisoner
The_Prisoner's picture

Sounds like the Australian financial services fraud sector finally got their own ZH troll. Caveat emptor is the default excuse for all scammers in this country.

Thu, 07/03/2014 - 04:31 | 4920662 Aussiekiwi
Aussiekiwi's picture

Thank you for that, reading it now, fascinating.

Wed, 07/02/2014 - 21:19 | 4919906 NoWayJose
NoWayJose's picture

The AUD is probably fairly valued. It's Aussie house prices that are way overpriced and in giant bubble territory.

Wed, 07/02/2014 - 21:34 | 4919944 UselessEater
UselessEater's picture

mmm... IMO, AUD over valued, but we sure gotta a few bubbles looking for a pin.

http://rt.com/op-edge/169908-australia-economic-boom-ending/

 

Wed, 07/02/2014 - 21:38 | 4919957 Grande Tetons
Grande Tetons's picture

The AUD has had its ass smacked already. Look to the NZD...that is one bloated piece of veal, IMO. 

Thu, 07/03/2014 - 04:52 | 4920672 August
August's picture

The only semi-justification I can come up with for the levitation of the NZD is that NZ's exports are largely of the digestible sort, that are consumed on an ongoing basis, and are renewable.  Once they've constructed enough railways and housing blocks, the Chinese can cut back on their iron imports, but may still want to buy dairy etc to feed the kiddies.  We don't produce rhinoceros horn and bear gallbladder, though.

Wed, 07/02/2014 - 21:28 | 4919930 Cognitive Dissonance
Cognitive Dissonance's picture

He was just test flushing the AUD fiat toilet.

<Around and around she goes (counter clockwise) where she stops everyone knows.>

Wed, 07/02/2014 - 21:33 | 4919940 Grande Tetons
Grande Tetons's picture

First thing I did when visiting the southern hemisphere for the first time was take a piss in my hotel bathroom.  Small pleasures. 

Wed, 07/02/2014 - 21:52 | 4920012 medium giraffe
medium giraffe's picture

Did it flush anti-clockwise? :)

Wed, 07/02/2014 - 21:58 | 4920021 Grande Tetons
Grande Tetons's picture

It made me ponder...what the fuck happens at the equator? 

Wed, 07/02/2014 - 22:01 | 4920033 medium giraffe
medium giraffe's picture

Goes everywhere apparently.  That's why Kenyan tribes don't wear pants.

Wed, 07/02/2014 - 22:09 | 4920054 stant
stant's picture

Corialis effect is like gravity, it's the law

Wed, 07/02/2014 - 22:14 | 4920065 Grande Tetons
Grande Tetons's picture

LOL, I chucke at how a post regarding the AUD can quickly tumble into a discussion regarding piss and the laws of gravity. 

Wed, 07/02/2014 - 22:24 | 4920092 Dr Benway
Dr Benway's picture

That's the beauty of ZH. Or of free discussion in general. By the way, the Coriolis effect on washbasins is mythical, it doesn't work on such small scale.

http://www.snopes.com/science/coriolis.asp

Wed, 07/02/2014 - 22:28 | 4920101 Grande Tetons
Grande Tetons's picture

Next thing you are going to tell me is that there is no Santa Claus. 

Free discussion indeed. Let us hope that never goes down the drain....or....washbasin.  

Wed, 07/02/2014 - 22:38 | 4920127 medium giraffe
medium giraffe's picture

Utah- the internet's giant septic tank.

Wed, 07/02/2014 - 21:33 | 4919941 datapanik
datapanik's picture

Christine Legarde has been harping on about a strong AUD for months. I wonder how many Australians voted her into power? Stevens is just another puppet for the elite, along with Abbott, Hockey and Bishop.

Thu, 07/03/2014 - 02:37 | 4920552 mrpxsytin
mrpxsytin's picture

Australia sells itself to the highest bidder no matter who is in government. We've never truly become a sovereign nation. 

Thu, 07/03/2014 - 07:10 | 4920806 nailgunnin4you
nailgunnin4you's picture

We've never truly become a sovereign nation. 


I like to think of my country as a fiercely independent US army outpost.

Thu, 07/03/2014 - 07:24 | 4920829 thestarl
thestarl's picture

Sigh....correct.

 

Wed, 07/02/2014 - 21:34 | 4919943 yepyep
yepyep's picture

Stevens is a lying degenerate.

Wed, 07/02/2014 - 21:41 | 4919976 Seize Mars
Seize Mars's picture

So, uh what's your son doing now, Doctor Stevens?

http://dailyseinfeld.com/post/79664133644

Wed, 07/02/2014 - 21:47 | 4919989 medium giraffe
medium giraffe's picture

Notice he did this on the back of softer Chinese data for added effect.  Meh, it was good for a quick 50 pips.

Thu, 07/03/2014 - 02:32 | 4920541 Squid-puppets a...
Squid-puppets a-go-go's picture

well, Australia's manufacturing base is dying courtesy of that $Aussie being propped up by bigger international forces to save face for Japan

I aint sayin Stevens is a hero or a saint, im just saying he is looking out for australias interests

as for the housing bubble in australia - i wouldnt be so hasty to put that at Steven's feet either. with respects to the Dr - his blog is awesome - but Australia's economy and market is at mercy to bigger forces than the Reserve Bank of australia can reasonably resist

we  here in australia have to inflate and burst with the biggest of them. short of Cuban style economic isolation, that  is our fate

Wed, 07/02/2014 - 23:41 | 4920292 Yen Cross
Yen Cross's picture

  I've got my eye's on gbp/jpy and it's "pimp daddy" overboughtness! I'm shorting that one  BITCHEZ!

Thu, 07/03/2014 - 00:11 | 4920352 Antihuman
Antihuman's picture

I can't wait to see Perth turn into a ghost town without the mines and all the cashed up bogans around to indebt themselves million dollar houses and BMW's. 

 

Thu, 07/03/2014 - 00:38 | 4920394 Jimbodude
Jimbodude's picture

I just sold my house and went into a rental. I am going to sit tight for six months or maybe a year and buy myself a half price mansion. Perth is the perfect storm for a property crash.

Thu, 07/03/2014 - 02:08 | 4920528 Antihuman
Antihuman's picture

There's no hope trying to talk friends out of investing in property at the moment. All I can do is wince every time someone proudly declares that they've got a brand new property. Smile and nod. 

Thu, 07/03/2014 - 02:35 | 4920549 UselessEater
UselessEater's picture

Smile and nod, or you're looked at as a fool. Damn shame! We're giving up a great country to fit some globalist cabal agenda, but what can one say when everyone else is luvving the journey?

https://www.youtube.com/watch?v=0PlaTF66lTw

Out on the patio we'd sit,
And the humidity we'd breathe,
We'd watch the lightning crack over canefields
Laugh and think that this is Australia.

Thu, 07/03/2014 - 03:25 | 4920591 Jimbodude
Jimbodude's picture

Talk to your average 25 year old bogan FIFO worker and his master plan is to gather a portfolio of 5 or so investment properties, offset any rental losses against their inflated wages via negative gearing and retire in ten years when he has sold the properties for double what he paid for them.

They buy their investment properties in the same suburb placing all of their heavilly leveraged eggs into the same basket.

Meanwhile Perth has record new starts, sales stocks have risen 5% year on year (the only city in Australia to see an increase this year) and rental vacancies sit at 5%.

 

Thu, 07/03/2014 - 04:10 | 4920636 Aussiekiwi
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I have noticed rent is dropping in Perth as landlords desperately try to obtain some cash.

Thu, 07/03/2014 - 07:30 | 4920838 thestarl
thestarl's picture

Yeah,I work in the met coal industry and its scary man how many young guys are leveraged up to their eyeballs in the property market believing the BS of never ending rising prices.

Thu, 07/03/2014 - 04:08 | 4920632 Aussiekiwi
Aussiekiwi's picture

yes I know a guy who timed it perfectly, saw the bubble in Perth at its peak when his $200k property zoomed up to $600k, promptly sold it at the peak and went all into physical Gold, which I think was about $900 Aussie at that point, smart guy who goes his own way, when he sold everyone thought he was crazy at the time.

Thu, 07/03/2014 - 04:40 | 4920667 Jimbodude
Jimbodude's picture

I have bought some phys with the proceeds because even if there is no upward movement in the spot price, a falling Aud will still return a profit.

Thu, 07/03/2014 - 04:04 | 4920626 Aussiekiwi
Aussiekiwi's picture

yep, I live in Perth. it has a massive apartment glut, have a drive around Burswood in the evening and see how many of those apartment buildings have no lights on, its generally not talked about even when the news of lay offs in the mining sector are coming through every couple of weeks.

I recently went up to Brisbane for a couple of weeks and it is absolutely booming in comparison to Perth, businesses and construction everywhere, the contrast is massive, Perth is just waiting for the other shoe to drop..

Thu, 07/03/2014 - 01:13 | 4920445 Mr Toad
Mr Toad's picture

Bogans of the West unite! You have nothing to lose but your flannel shirts!

Thu, 07/03/2014 - 03:27 | 4920594 AUD
AUD's picture

Glenn Stevens also said "people shouldn't assume house prices always rise" several years ago, & house prices have continued to rise, as if people should assume house prices always rise.

Last November, the RBA began its special MBS monetisation program, just like it was monetising MBS before, but now on steroids. So house prices have continued to rise.

Thu, 07/03/2014 - 04:00 | 4920617 Aussiekiwi
Aussiekiwi's picture

Think the Aussie housing market is bloated, look at New Zealand, the Chinese are pouring in to buy property which has resulted in a massive housing bubble and grossly overvalued currency. Why are the Chinese buying?

NZ is seen as a safe country with a low level of corruption.

There are no restrictions on buying property.

There is no capital gains tax or stamp duty etc in NZ., so your costs to buy a property in NZ are about $800 in conveyancing and maybe a LIM report from the council, I think they are around $300.

No termites or other pests to worry about in NZ.

Friendly naive people.

 

Thu, 07/03/2014 - 07:10 | 4920804 The Most Intere...
The Most Interesting Frog in the World's picture

So many countries so willing to launder money for government crony thieves...

Thu, 07/03/2014 - 07:35 | 4920759 Counterfiat
Counterfiat's picture

We of the   never never   nether ether.

Thu, 07/03/2014 - 07:29 | 4920837 Munkey
Munkey's picture

Australian housing is outside of the control of the RBA and well under the control of Chinese investors. Only government policy can reign it in and they aren't the type to go stopping the gravy train. Locals are effectively being priced out of the major cities. There is no way the locals can compete against the immense wealth of Asia. They truly are the boss of us.

Thu, 07/03/2014 - 07:55 | 4920865 COSMOS
COSMOS's picture

They are your boss because your politicians as you have said, have sold you out.  If you take back your country and limit these foreign capital inflows you will have affordable housing.

Thu, 07/03/2014 - 10:26 | 4921360 Munkey
Munkey's picture

I get that kind of feeling, you know that bad feeling in my gut that the foreign capital inflows are being used to prop up a hollowed out economy devoid of a manufacturing and resource sector. We've gone into full financialisation of the economy based on hot Chinese money. I just get that feeling, you know that helpless feeling of the little man powerless to change anything but you can see it all ending badly eventually.

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