Bank greed and latent risks.

The Royal Commission into Banking suggests that performance-based increases in the Big 4 banks fostered cultures where greed trumped controls in treating customers fairly. Read More

China – no hard landing – yet.

China’s government policy decisions are increasingly signaling near-term economic stability as a priority. This means the Australian economy is unlikely to suffer a shock from its largest trading partner in the next 6 to 12 months. Read More

Our double Minsky risk.

The good times have long rolled on for both China and Australia. The concern is, as the famous U.S. economist Hyman Minsky said, “the longer things are stable, the more unstable they will be when the crisis hits.” Read More

Trying to win the relatively ugly contest.

As a corporate bond fund manager, our quest in this environment is to be the least ugly. Protect capital, beat deposits and then ready ourselves for improving returns as investment conditions improve is how we plan to manage our funds.
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Can the interest-only bomb be defused?

In our view, the Australian residential property market is a large debt-fueled financial bomb. To diffuse the situation requires APRA to up the ante on banks de-risking and hope the market backdrop remains benign.  Read More

History will not be kind to them.

Years from now, when historians look at the “big ease” after the “great recession” of 2008, we suspect the reviews of some central bankers of the recent era will not be favourable. Read More