Amazon In Oz

You might remember that when they launched last December, everyone was asking: “Is that all there is? Is that it?” That’s because its prices were high and the range was limited. Well, they were just taking their time.

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Yield and Risk

The XFJ accumulation index, which includes ASX 200 banks and REITs, along with their dividends, and which might be described as Australia’s retail bond market, underperformed the broader market last year – 5% vs 12% for ASX 200 Accumulation – and has the sector started the new year in the same vein: -1% vs flat.

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The Market At 6000

I had a coffee this week with a private equity investment manager, who was explaining that he never pays more than 4-6 times EBITDA (cash flow) for a business. And that’s pretty typical for those who actually buy businesses – you want a cash payback of no more than five years, or a very good reason for something longer (that is, “strategic reasons” – which is to say, you really want it).

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Neutral Madness

There was a bout of pure silliness this week after the Reserve Bank put out the minutes of its June board, including discussion of the “neutral cash rate” – that is, the goldilocks rate, at which inflation and unemployment are both low and stable.

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Inflation & Technology

The words “technology”, or “blockchain” and “AI”, did not sully this week’s minutes of the last Reserve Board meeting, and the word “inflation” did not get a Guernsey in a speech by Governor Philip Lowe on Monday that was partly about technology.

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The New Globalisation

I recorded a long, fascinating interview this week with Richard Baldwin, professor of international economics at the Graduate Institute of International and Development Studies in Geneva, and author of new book called “The Great Convergence: information technology and the new globalisation”.

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