RBA to cut another 1%?

those banking bonuses are a great gravy train to get on. the bankers in London pull 1m pound bonuses.... living the dream
I'm just a junior person in Sydney. So yes, the goal is Wall Street or Canary Wharf. Especially that the AuD is going down. USD is the best currency to earn in the medium term.
 
Drive, determination and an I can beat the world attitude are good traits to have when they are balanced with a humility and understanding that being in a fortunate position financially when you have started from "nothing" in life is both due to skill and good (sometimes lucky) timing.

I guess that comes with experiencing both the good and the bad that life can throw at you through the years.

Anyone who is making good coin in a JOB at a young age can lose sight of the reality that it can be taken away in an instant at the whim of an employer.

Don't lose sight of this younglings, and be appreciative that others who are older, who may not have been on the big coin, still have valid views that are relevant.
 
indeed they do.

wonder why you're sticking to your FOREX/CAPEX argument if the market is that fickle.
Spoken like a true trader.

Unloadmymind, I sit next to guys who deal FX in yards intra-day and one common trait they all have is humility and respect for the absolute fisting the market can give you just when you think you've made it.

Besides you lost all credibility when you gave weight to Goldman's calls ;)
 
Swap rates used to price fixed rate loans have resumed their downward move. ###

... And so did the Government Bond yields.
To get back on topic...

As we both know swap rates change every minute - they go up or down all the time. However, we're mostly property investors - we think in terms of returns after a decade or so.

Can you put your statements in context ? Maybe provide a 3yr chart to show how big this downward move you've identified really is ? And give us an overview of the causes & implications, and your expectation of where the move will finish. And possibly even risks to your analysis ?

We'd all appreciate an expert opinion.... and there's a few oldies here, so please type slowly.
 
Spoken like a true trader.

Unloadmymind, I sit next to guys who deal FX in yards intra-day and one common trait they all have is humility and respect for the absolute fisting the market can give you just when you think you've made it.

Besides you lost all credibility when you gave weight to Goldman's calls ;)
Goldman Cookies? Yum
 
Anecdotally we are starting to see some of the larger macro funds get positioned for a turn in Aussie rates/FX. Perhaps the market is already priced and the RBA is chasing a ghost?? I'm not smart enough to know, but maybe unloadmymind could weigh in....
 
indeed they do.

wonder why you're sticking to your FOREX/CAPEX argument if the market is that fickle.
Context. It fell and stayed that way. It was not the minute by minute change but the start of a firm trend. We haven't seen the FOREX trend reverse after the Capex release, have we?
 
Interestingly, the RBA Shadow Board thinks rates should rise within 6 months. It seems to think that the economy hasn't weakened much in the last few months, so the current setting is appropriate.

What the Shadow Board believes

The Shadow Board?s confidence that the cash rate should remain at its current level of 2% equals 60%. The confidence that a rate cut is appropriate is a mere 2%, whereas the Shadow Board considers it much more likely (38%) that a rate increase, to 2.25% or higher, is the appropriate policy decision for this month.

The probabilities at longer horizons are as follows: six months out, the estimated probability that the cash rate should remain at 2% equals 23%. The estimated need for an interest rate increase lies at 76%, while the need for a rate decrease is estimated at 3%.

A year out, the Shadow Board members? confidence in a required cash rate increase equals 81%, in a required cash rate decrease 2% and in a required hold of the cash rate 17%.
This is the direct opposite of what the yield curve is telling us. But as the Shadow Board is mostly economists maybe we should heed Buffet Any company that employs an economist has one employee to many.
 
Interestingly, the RBA Shadow Board thinks rates should rise within 6 months. It seems to think that the economy hasn't weakened much in the last few months, so the current setting is appropriate.
It isn't just that.

A couple of them (Dungey and McKibbin) both mention asset prices (the former started her career at the RBA, and McKibbin is a former RBA Board member).

There are question marks over whether lowering the rate even further will actually stimulate the wider economy (or just feed asset prices, which seems more likely).

And the caveat of a Greek default and if the effects are far reaching that it is better to have some powder dry.

All of which sounds reasonable to me.

But as the Shadow Board is mostly economists maybe we should heed Buffet Any company that employs an economist has one employee to many.
Who else, besides economists, do you think should be on a self-appointed shadow RBA board?

Yes I realise that the actual RBA board is a 6-3 majority of non-economists, though you can't tell me that (as an example) Roger Corbett - who I have no doubts is a very intelligent man - is one of those that calls the shots on the interest rate setting in a $1.5 trillion economy.

(And in saying that, John Edwards used to be Keating's Chief Economic Adviser)
 
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