The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."
Monday, December 5, 2011
UBS: Industry sales, wage income, and company profits all surge in Q3...
** Industry sales rose strongly in Q3, up by 1.2% after a revised +0.6% for Q2 (was +1.0%), the strongest q/q print in two years and taking the y/y pace to 3.1% from 1.0% in Q2. Consistent with the drop in 'inventories', this suggests a relatively solid "GDP - production" side of the GDP accounts due Wednesday. The rise was relatively broad-based, driven by mining sales (+6.2%) and wholesale sales (+2.2%), with solid gains also in manufactutring (+1.3%), construction (+1.5%) and retail sales (+1.7%).
** Wages growth was up strongly again, rising 1.8% q/q after +2.3% in Q2, keeping the y/y pace of the economy's "wage bill" (so reflecting, wage rates and hours and jobs) at a high 7.8% y/y (was 8.0%) - where it's been for the past year, and well above the -1.7% y/y pace at the end of 2009. This would suggest strong income flows to the household sector, and a good contribution to the "GDP-income" side of the GDP accounts. The gains were relatively broad-based, but particularly for the mining sector (+7.4% q/q to be +30% y/y), utilities (+4.3% q/q and 16% y/y) and construction (+4.2% q/q and 14% y/y), while retail was the only sector to trim its wage bill in Q3 (-1.0%, +1.5% y/y).
** Company profits bounced a further 4.8% q/q in Q311 (UBS 0.0%, mkt: 3.0%) - to a record high level - after rebounding by 7.3% in Q2 (revised up from 6.7%). This sharply lifted the y/y to 8.8%, from just 0.2% (which was the weakest since Q110). Growth was across both mining (+5.0%, 7.8% y/y) and non-mining (4.7% q/q, 9.4% y/y). The inventory valuation adjustment suggests (national-accounts) profits will increase even faster by around 7% q/q for nominal GDP 'income' - and hence will add solidly to growth.
** ANZ job ads are showing signs of troughing, with a flat m/m print in November (0.0%, UBS: 'flat', mkt: nf), after 4 consecutive falls (with October revised up a tick to -0.6%, from -0.7%).