Pete Wargent blogspot


'Must-read, must-follow, one of the best analysts in Australia' - Stephen Koukoulas, ex-Senior Economics Adviser to Prime Minister Gillard.

'One of Australia's brightest financial minds, must-follow for accurate & in-depth analysis' - David Scutt, Markets & Economics Editor, Sydney Morning Herald.

'I've been investing 40 years & still learn new concepts from Pete; one of the best commentators...and not just a theorist!' - Michael Yardney, Amazon #1 bestseller.

Tuesday 30 June 2020

Financial stress at a very low level

Australian household finances improve

James Foster looks at the latest ABS surveys here (or click on the image below):

Very low levels of household financial stress to go with bankruptcies and insolvencies coming off quarter-century lows

Monday 29 June 2020

False starts ahead for Melbourne


Australia's amazing run continues for COVID-19, with another day of zero community cases all around the country...except in Victoria.

Unfortunately Victoria saw a worrying 75 new cases today, which makes for the worst day since March for that state.

The curve is therefore taking a second turn north:

Overall this was Australia's worst day since April 10.

There is still on only one ICU case in the entire country, and there were no deaths.

Thus while the rest of the country is easing back restrictions, Victoria is tightening up again - and this is almost certainly going to mean more stimulus for longer.

I discussed this on ausbiz TV this morning here (or click on the image below):

Rental listings decline from a year ago

Rentals filling up

Top notch research from Louis Christopher of SQM Research.

As expats return to Australia and as rents have eased the feared glut in rental listings has dissipated.

SQM confirmed that these numbers have been checked.

Therefore expect a decline in vacancy rates to be reported in June 2020.

High quality real-time insights from SQM Research.


Solid preliminary auction clearance rates for Sydney this weekend:

Source: CoreLogic

Podcast Episode #12: Superforecasters

Podcast Episode #12: Superforecasters

Tune in to Episode 12 of our Low Rates High Returns podcast series here (or click on the image below):

You can also tune in at SoundcloudStitcher, or Spotify.

Don't forget to leave us a friendly review, as it helps us to get the word out. Cheers! 

Sunday 28 June 2020

Melbourne, we have a minor problem

Melbourne hit by virus

As the US blazes through a terrifying 2.6 million cases of COVID-19 and notches record daily highs in the process, here in Australia we are left pondering some relatively minor numbers. 

Indeed, there is only one ICU case now remaining in Australia, while deaths are effectively running at zero (or less than zero when you consider how self-isolation, sanitising, and flu vaccinations have improved hygiene overall). 

The hospitals are empty, and seven of the states and territories are now effectively COVID-free.

Victoria has, however, seen a flurry of new cases over the past six days, which is turning the curve gently higher and threatening to become a problem.

New South Wales and Western Australia have put a handful of overseas traveller cases into quarantine, but all of the community cases are now being found in Victoria.

Thus while the rest of the country is easing up on restrictions Victoria is likely to see things going the other way and tightening up again. 

Given that Victoria is the second most populous state this is likely to mean that more stimulus is needed for longer in Australia. 


Preliminary auction clearance rates picked up to 64 per cent in Sydney on Saturday with the median sold price ticking above $1.2 million, but clearance rates slumped into the 50s in Melbourne.  

Podcast Episode #12 Preview: Superforecasters

Podcast Episode #12

A preview of Episode #12 of our podcast series is in the audiogram below:

You can listen to the earlier episodes here, or you can also tune in at Soundcloud, Stitcher, or Spotify.

Don't forget to leave us a friendly review, as it helps us to get the word out. Thank you!

Narratives versus numbers

Statistics over stories

A short post today on narratives versus numbers - see here for more or click on the image below:

Saturday 27 June 2020

Top globally ranked podcasts

Must see articles

This weekend at Property Update a look at what could cause property prices to fall, and the rebound in job vacancies.

Click here to read (or on the image below):

You can subscribe for the free Yardney podcast here.

The podcast series is now ranking in the top 40 Business and top 40 Educational podcasts globally in audience growth, which is some feat.

September cliff emphatically rebutted (AFR paywall)

September cliff risk

Well, that couldn't be much clearer.

Policymakers firmly rebutted concerns about a September 'cliff' with a range of countering policies.

Via the AFR lead article here (paywall):

Cliff to be averted

This week on The BIP Show we discussed the 'The Theory of Thing' with respect to the prospect of a September cliff.

The theory holds that the more a looming risk is openly discussed and becomes a known risk the less actual impact it tends to have on markets. 

Listen here at (12:24 through to 16:50) (or click on the image below):

Friday 26 June 2020

The BIP Show: The Outlook for Australian Property

BIP Show

It was a privilege to be invited on The BIP Show, following in the footsteps of some amazing guests.

Tune in here to listen to this longform podcast (or click on the image below):

Thursday 25 June 2020

Wednesday 24 June 2020

US doing a terrible job with COVID

COVID crisis re-emerges

Awful numbers out of the US, with COVID-19 numbers soaring to their second highest daily total yet.

All of the improvement in new cases since April has come undone over recent days.

California, Arizona, and Texas had their biggest days ever for new cases, while new cases in Florida are rising nastily again. 

The number of deaths had clearly been trending firmly down, but there's been a nascent spike here too.


Let's hope that this doesn't persist.

Job vacancies up 31pc, but...

Jobs rebounds begins

Job vacancies jumped by 31.1 per cent or +21,700 in May 2020, which is the good news.

The bad news is that this is still -49 per cent or -87,800 down from a year earlier.

All states bumped off their lows in May, with the big four states bouncing by 30 to 40 per cent.

It's going to be a long way back before things are back to situation normal.

UK housing prices rise

UK housing prices up

UK housing prices keep on keeping on, rising bt +2.4 per cent over the year to May 2020.

That's an acceleration from the beginning of the year, per Hometrack's index.

Northern cities have been leading the charge:

Asking prices for sold homes were up +7 per cent over the year.

Mortgage relief may be extended all the way out to April 2021.

Hometrack's report can be found here.

Monday 22 June 2020

This is why you should think marginally about your time

Take charge of your schedule

See here for more (or click on the image below):

Property searches up for 12 consecutive weeks

Property buyers circling

Search volumes are up +73.4 per cent in 12 weeks, and +47.3 per cent from a year earlier.

More from Cameron Kusher at REA Group here (or click on the image below):

Source: REA Group


Much more promising COVID-19 numbers today.

There was a net increase of +13 cases, 5 of which were returning travellers from overseas in quarantine. 

2 of the cases were in New South Wales, with the remainder in Victoria. 

Podcast Episode #11: The Kelly Investor - THIS is how to maximise your long-term wealth

Podcast Episode #11

Tune in to podcast Episode #11 here, where we discuss the Kelly model for investing.

Listen super-carefully to this episode as there as some absolute gems of information in there from Stephen.

Tune in here (or click on the image below):

You can listen to the earlier episodes here, or you can also tune in at SoundcloudStitcher, or Spotify.

Don't forget to leave us a friendly review, as it helps us to get the word out. Cheers!

Sunday 21 June 2020

Saturday 20 June 2020

Spitting cobra

Cobra effect

During British colonial rule of India the government was concerned about the prevalence of venomous cobras.

Their proposed solution to the problem was to announce a bounty for every dead cobra. 

Of course, this led to opportunists breeding ever more cobras in order to collect the bounty, and the solution ultimately made the initial problem worse. 

Labor faceplants

It's been an awkward week for the prestigious Victorian Labor Party.

After 60 Minutes exposed systemic corruption and allegations of massive branch stacking, Premier Andrews attempted to deflect attention by lobbing out an ill-judged sideswipe at South Australia. 

While nobody wants to see Victoria fail to contain COVID-19, there was a certain inevitability about the instant karma which arrived today in the form of 25 new cases in the state. 

The good news is that every other state and territory has reported zero new community cases, and indeed there are no ICU cases anywhere in Australia away from the two instances in Victoria. 

The Andrews solution to families and workers failing to self-isolate is to offer $1,500 to folks with the virus, which sounds rather like a cobra effect solution on steroids (admittedly there is already a similar system in place in Queensland, where there have been zero new cases for quite some time). 

Victoria has reverted to Stage 2 restrictions which will be detrimental for consumption  - especially for pubs, bars, and restaurants - suggesting that a V-shaped recovery south of the border simply isn't going to happen, while the JobKeeper stimulus may need to remain in place 2020 in its entirety. 

This is how to formulate a strategy for life

Thinking in timeframes

See here for more (or click on the image below):

Funding costs

Funding costs

Australia's 3-month bill rates fell to below 0.10 per cent during the week.

That's tracking well below the official cash rate of 0.25 per cent.

Banks are also flush with cash due to lower lending volumes and a surge in deposits.

Excellent graphic via Shane Oliver of AMP:

Source: Shane Oliver, AMP

Credit policies are still pretty tight at the moment, as caution abounds.

But the potential ability to lend at record low rates is there.