News and Views, #2 (Jan/Feb overlap)
Updated: Feb 5, 2022
General sporting results. Barty wins the Aussie open in a wonderful way. 6-3 for first set. A cool, hard fight back from 5-1. What a tennis star!
Then our boys, K & K, surprised everyone who played men’s doubles, with only two tennis racquets destroyed.
And overnight, Mr Nadel fought back from two sets to none and it looked like the grumpy Russian was cruising to a win. But Mr Nadal won the next three sets and after 5 hours and 24 minutes emerged as the twenty-first grand slam winner. His two twenty timer winners were sporting in their comments.
AFR, Editorial&Opinion, 29-30 January, ‘Two lessons for markets and central banks’.
‘The global inflation spike has taught two stark lessons this week – one for markets, and one for the central banks that investors have relied upon to turbocharge asset prices in the era of cheap money thar began during the global financial crisis’.
‘Investors learnt that the pandemic version of zero-cost US Federal Reserve money for markets, the ‘Powell put’, has now gone. And central banks have learnt that what they need to put first again is their credibility on fighting inflation’.
Yes sir! And the Australian central bank is bravely but foolishly sticking to a 2024 rate hike, or (reluctantly) 2023. This will need to change. Recent article proudly pointed out that the RBA board consisted of business people, with one (or is it two?) economists led by Dr Lowe.
Clearly the ‘business’ members lack the knowledge to help Dr Lowe who has made himself a bit of a dill.
The Weekend Oz, Front page, 29-30 January, ‘ ‘Batman’ (Linfa Wang) to the rescue with Covid immunity breakthrough.’
Small numbers of people who had survived SARS infection and recently had received a Pfizer shot with the original Wuhan Covid and later variants. (I am not sure I understand the mechanics here.) The result was surprisingly extraordinarily strong immunity levels, repeated with a second group. Watch this space!
John Spooner’s latest cartoon is a ripper. I hope I am allowed to copy it here. (Sorry, folks, I cannot find it. How come we pay for newspapers and their best products (cartoons) are not available to allow some free publicity and improve Henry’s daily offering.)
The Oz, January 31, ‘Aussie power play launched by Quad’. Greg Sheridan returns from leave with a front page and p2 account of the forthcoming strategic meeting of Australia, USA, Japan and India.
‘The Quad passed a critical test when the Biden government came out as even more committed to it than the Trump administration had been. Now Mr Blinken has picked up the Pompeo banner and made the Quad high priority in Washington’s Indo-Pacific policy’.
Former Prime minister, Tony Abbott, on P 11 tells us ‘Surest way West can prevent was is to lift costs to aggressors.’
‘What’s suddenly become shockingly apparent, to the horror and bewilderment of everyone accustomed to thinking that major war had been consigned to the dustbin of history, is that it’s not goodwill or even common sense that keeps the peace between nations but armed forces powerful enough to make aggression futile, and in the case of small countries challenged by big ones, alliances that can be relied relied upon to turn the temptation of war by the strong against the weak into the deterrent of war by one against many’.
Phew. A lovely long sentence, reminiscent of Mr Nadal’s 40 shots with the Russian in the forth set (I think).
And Tony’s final sentence. ‘We can only hope that doing little and late is enough, and we don’t have to live for decades in a much more militarised world pondering our culpable neglect’.
This is the basis of my call for defence spending of 5 % of GDP. Only bloke who might eventually accept this is defence Minister Peter Dutton. Sadly it looks as if Labor is likely to win the next election and one suspects it does not know what defence of the realm means.
The AFR, Editorial&Opinion, 31 January, p 38: ‘Albo doesn’t hold the reform hose’.
Neither it seems does Scotty. ’Neither Mr Albenese nor Scott Morrison wants to hold the hose when it comes to serious economic management. The reform agenda Australia needs has been parked by the political by the political system for decades because neither the C Coalition nor the Australian Labor Party has the political will or the will power to make the case to the people of Australia’.
Next to this powerful critique is a nice David Rowe cartoon. Scotty is speaking to Albo on his TV screen. ‘Free Rats!! You cannot be Serious!!’
Big week for the mighty RBA. Do not be surprised if proposals are still weak as water, with rate hikes coming too little, too late.
The Oz, February 1, front page ‘Record debt to squeeze rate hike’. ‘Australians will head into the first-rate hike cycle for 13 years with household debt as a proportion of disposable income at its highest level in history – a situation experts say has made the economy more sensitive than ever to higher borrowing costs.’
‘Reserve Bank of Australia governor Philip Lowe on Tuesday is expected to open the door to a lift in the cash rate later this year, after underlying inflation reached the central bank’s target the first time since 2014 and two years ahead of schedule’.
Economists however are said bureaucrats need to be ‘careful not to tap the monetary policy brake too hard or risk stalling economic growth’.
The US Fed is said by some to have 4 rate hikes this year and three next year. The previous ‘Fed put’ seems finally to be put away. Now Asset inflation needs to be treated with some care, and let’s hope this becomes a far more sensible policy than near zero cash rates and no limit to Asset inflation.
The AFR, Editorial&Opinion column, also 1 February, headlines ‘Stop borrowing from the future’. Of course this has already happened, bigtime, and households have massive cash balances. If this pool is spent carefully (and slowly) it may not be a catastrophe but if households go on a spending picnic inflation will be quickly out of control.
The Oz, front page, Feb 2, ‘Mistakes? I’ve made a few’. Prime minister Scott tries to show he is human, with some success.
His biggest mistake was ‘he hadn’t treated the national jabs rollout as as a military program from the outset’. He also wishes he hadn’t predicted a happy time with the Omicron this summer. Same mistake as that of Philip Lowe trying to predict the future, first rate hike in 2024.
These ‘great men’ should understand how silly it is to try to predict the future. Provide some ideas of possibilities if you wish, but no single outcome guesses.
On Dr Lowe, I loved Patrick Commins, also on front page of the Oz. ‘After a decade of stagnant consumer prices, RBA governor Philip Lowe is playing chicken with inflation. Let’s hope we don’t get flattened by it’.
And on P5. 'After extraordinarily bullish inflation and jobs forecasts revealed on Tuesday, the question has to be asked why is Philip Lowe not rushing to fire the starting gun on rate hikes?’ Sigh!
In the AFR the theme seems to be support for Dr Lowe. (Check John Kehoe (P5) and Karen Maley (P32.)
But, as usual, the AFR Editorial&Opinion column shows great good judgment. Today (3 Feb) the following para hopped out at me.
‘The more important election issue not tackled by the Prime minister, nor by Labor leader Anthony Albenese last week, is what policy changes are required to reverse Australia’s pre-pandemic productivity slowdown, increase the economy’s potential growth rate and start to pay down the trillion-dollar debt burden left by the pandemic spendathon.’
I cannot resist posting a cartoon by John Spooner, called Hey Presto. So far as I can see it is not yet posted. I’ll keep watching.
The Oz, Feb 4, Robert Gottliebsen, P21, ‘Central bank structure in need of an overhaul’.
‘The Reserve Bank of Australia has had two of the worst years in its history and we are yet to fully appreciate the damage its fundamental mistakes have caused’.
‘And when you look at how the central bank now operates and its board composition it is likely it will continue [to] make major errors’.
Read on, gentle readers. At last, a wide spread expose, and many of us out here share Gottie’s concerns – the most senior being Peter Costello.
Meanwhile, Dr Lowe has finally conceded that a rate hike may occur in 2022, a long way short of ‘possibly 2024’. Gor Blimey readers! Finally a jump to somewhere near reality.
The AFR, P 38, Editorial&Opinions, 4 Feb, ‘PM’s Press Club grilling was a sorry business’.
Goodness me, premier of NSW sends a nasty message via an unnamed postman. Deputy PM Barnaby does something the same, allegedly while he was lurking in the shadows as a mere member of parliament. Do these people, supposedly on the coalition side, not know: (a) such things never stay unshown, and (b) when they are revealed, the Coalition’s unlikely win the forthcoming Federal election gets to be a longer shot.
Back to the Press Club event. ‘There is no program for the full-blooded structural reform – such as incentives sharpened tax reform or productivity-enhancing workplace reform needed to lock in lower unemployment, higher wages and low inflation, and turbo-charge Australia’s growth out of deficit and debt.’
‘The alternative, Anthony Albanese is just as willing as Mr Morrison is to hold the reform hose.’
Seems to me like another wasted term of office whoever wins the poll in May.
My email address is peterdjonson @gmail.com