90 seconds at 9 am: Confidence rising

90 seconds at 9 am: US confidence, house prices at multi-year highs; OPEC rifts; Euro banks lending again; NZ$1 = US$0.810, TWI = 76.6

29th May 13, 8:52am by David Chaston

Here's my summary of the key news overnight in 90 seconds at 9 am, including news of improving sentiment around the globe.

American consumer confidence climbed to the highest level in more than five years and home prices rose by the most in seven, as the housing rebound gave the US economy a lift.

Stocks rose following the Memorial Day holiday, and yields on US Treasuries rose as well, mainly because there were less buyers as investor funds shifted into equities and away from 'safety'.

A similar trend has emerged in Japan with lower demand for their Goverment issues raising the interest rates they are paying.

The energy boom in North America is deepening splits within OPEC, and is threatening to drive a wedge between African and Arab members as the cartel grapples with a revolution in the oil trade.

More than that, the Aussies have been chided for reacting too slowly to the same big shifts. The amount of new natural gas available is truly staggering.

In Europe, we are starting to see some early signs that more normal business conditions are returning. Their big banks are parking much less cash with central banks, instead using the surpluses for normal business lending, according the a recent survey.

Their crisis is far from over of course, but havings banks lend with their funds rather than just clipping the ticket on ultra-low interest rates, is a better sign.

Tomorrow we get to see if the RBNZ dabbled in the currency markets in April. Remember the NZ$ bought over 86 USc then and it has fallen almost 6% in the past six weeks or so.

We may also get Fonterra's first estimate of next seasons payout either today or tomorrow. Currency pays a big part in that too.

The NZ dollar starts today at 81.0 USc, 84.1 AUc as the Aussie sinks further, and our TWI is up to 76.6.

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13 Comments

by Stephen Hulme | 29th May 13, 9:24am 1369776278

American consumer confidence climbed to the highest level in more than five years and home prices rose by the most in seven, as the housing rebound gave the US economy a lift.

A development consistent with rising personal incomes and general US GDP growth?

The bottom tier of the market continues to drive price increases in most of these cities. While the rate of price increases in Phoenix moderated slightly to 1.8 percent in March, prices for homes in the bottom third of the market jumped by 4.3 percent. Over the last three months prices for homes in the bottom tier have risen at a 47.0 percent annual rate. They are up 39.7 percent over the last year. Read more

Certainly a rate of valuation improvement consistent with rabid animal spirits of bank lending officers throughout the nation and positively another instance of central bank driven bubble economics in need of an eventual rescue.

by Plan B | 29th May 13, 10:31am 1369780305

http://www.guardian.co.uk/business/2013/may/27/deloitte-appoints-dave-h…

Great story about Deloittes in UK

by Stephen Hulme | 29th May 13, 10:42am 1369780947

Yep - there should be a law against such indiscriminate arrogance

by Christov | 29th May 13, 12:43pm 1369788236

It's a classic...can't beat em, join em scenario....you have to laugh or you'd go out and murder somebody...er, maybe.

Cameron......now ah look here thingy me ol taxman, I can't really stop you from joining up but I don't want you advising about Tax avoidance yeah, talkings ok, but no advising right...?, good man...!

`The smug indifference to wider opinion has an all too familiar ring.

by Boatman | 29th May 13, 10:31am 1369780317

On the "Oil - Age" , The shift to natural gas and away from oil is a major event of of masssive , dynamic and revolutionary proportions.

Its interesting to note that the stone age did not end because the world ran out of stones , the oil age will not end because the world runs out of oil.

Oil's monopoly will end , eventually as we will find and develop alternative energy sources,

by powerdownkiwi | 29th May 13, 11:40am 1369784415

Boatman - you've been pulled up on that before, can we move on please?

Stones are not an energy-source. Why the need to continue with the myty/fudge/untruth?

NGL's have long been expected to increase, but not to displace depletion, overall.

http://www.peakoil.net/uhdsg/

http://thetyee.ca/News/2013/02/23/David-Hughes-Fracking-Report/

http://socialsciences.arts.unsw.edu.au/tsw/RE.html

by Neven911 | 29th May 13, 12:05pm 1369785929

PDK

NGL or LNG? There is going to be a huge boom in building liquifaction plants around the world but I agree its a twitch of the corpse

by steven | 29th May 13, 12:24pm 1369787053

Neither, I dont see that these will be built or last long enough to matter. I'd hazard a guess that eventually, within 5 years ie before these can get built and producing at full chat countries with these will shut them down and hold onto the gas for themselves.

Think civil defece and the long emergency...

regards

by steven | 29th May 13, 12:20pm 1369786825

The coal age ended because we (in the UK at least) ran out of coal. Winston Churchill clearly saw that and moved the fleet to oil. So in turn the oil age will indeed end, even the most optimistic forcast sees oil gone by 2080 at most (2050 more realistic). Now I for one wont be around, but my chidren and grandchidren will be.

So how about you tell us what they will move to?

Try researching before you post so at least what you say is supportable.

try and work in some economics/costs and timescales as well...

Oh and maybe consider how much steel is left to do it with.

regards

by dh | 29th May 13, 12:29pm 1369787371

On Easter Island, the wood age ended when they ran out of wood (a rather dramatic collaspe). I think standard wisdom around the stone age/bronze age crossover at the moment is that argicultural sedentism (while it took more energy to produce the same amount of food than hunting/ gathering so was less efficient) was better suited to storing surpluses which meant that specialisations like bronze working were easier.

by goNZ | 29th May 13, 2:06pm 1369793189

another rotten setback to pdk,steven et al theorists as " The amount of new natural gas available is truly staggering."

by Plan B | 29th May 13, 10:47am 1369781247

Dave Hartnett former head of HMRC appointed to HSBC and Deloittes in UK - Japanese call it "ascending to heaven" no one does anything wrong, there is just an unsaid understanding

by Mike B | 29th May 13, 12:21pm 1369786871

David,

The DOW went up exactly as i said it would in last Friday's 90 seconds. Just the 1% creaming the super funds.