A review of things you need to know before you go home Thursday; deposit rate changes; producer price index; ANZ Consumer Confidence; concrete production; Australian employment; TPP11; bond issues; local rates lower; NZD stronger

Trade Minister Todd (what recording) Barclay????

Bannon said he favors pushing back against Chinese economic expansion, arguing only one country will emerge as a leader from what he described as an "economic war."

“To me, the economic war with China is everything. And we have to be maniacally focused on that. If we continue to lose it, we’re five years away, I think, ten years at the most, of hitting an inflection point from which we’ll never be able to recover," he said.

He advocated for the U.S. to file a complaint under Section 301 of the 1974 Trade Act -- which allows for sanctions against countries that violate trade agreements or engage in unfair trade practices -- as well as follow-up complaints against steel and aluminum dumping, Kuttner wrote.

"We’re going to run the tables on these guys. We’ve come to the conclusion that they’re in an economic war and they’re crushing us," Bannon said.

Bannon also dismissed speculation that the U.S might consider using military action against North Korea to get the regime there to abandon its intercontinental ballistic missile and nuclear weapon programs. Trump recently vowed to deliver "fire and fury" onto North Korea. Read more

It’s a lot harder for David Yim to rack up the airline miles these days. The bond underwriter at Standard Chartered Plc used to fly across the Pacific from Hong Kong to the U.S. four or five times a year to arrange dollar-debt deals, but he’s not sure he’ll make it even once in 2017.

Such is the gravitational pull China is having on the market for dollar bonds issued by Asian companies and banks. Borrowers used to tap U.S.-based investors when they sold dollar securities. Now, there’s a big enough pool of greenbacks in Asia and predominantly Chinese buyers are able to take up the vast majority of bonds sold in dollars.

Within three years, this market may reach $1 trillion, composed mostly of Chinese dollar bonds, according to projections from Australia & New Zealand Banking Group Ltd. Big Chinese demand may be changing the risk dynamics of the dollar bond market in Asia, according to market watchers.

"Having a Chinese buyer means there’s a different risk profile -- it’s not like Western money managers investing in Thailand before the Asian crisis," said Nigel Pridmore, a long-time capital-markets attorney and partner at Hong Kong-based law firm Ashurst. Read more

The world has been laboring under several great misconceptions.  The first is that the dollar is the world’s reserve currency; it is not, and has not been for a very long time.  The eurodollar long ago subsumed that role, and then expanded it into all sorts of interbank things that up until 2007 nobody heard of or cared to figure out.  It all worked because it all seemed to work.

The second fallacy is that the money multiplier of Robert Owen’s time, the one the Federal Reserve is set up to meet, still matters; it does not.  I wrote in 2013:

“There were two major evolutions in money and banking that seem to fall outside the orthodox narrative. The first was a shift of reserves and bank limitations from the liability side to the asset side. The second was the rise of interbank markets, ledger money, as a source of funding rather than required reserve balancing; replacing the old deposit/loan multiplier model.”

Read more

Are house sales in Auckland actually collapsing at a faster rate and are prices set to tumble. When Barfoots released its June/July data its market share spiked , historically seasonally unusual. This can only be due to its reliance on auction numbers , and the fact that they are basically unconditional sales. With Barfoot auctions and successful auctions numbers collapsing, everything turns to negotiation and indeed conditional sales, all of which will have a minimum 2 week lag if not longer before they become included in actual monthly data. With prices falling, finance tightening and heaven forbid purchasers able to walk on one or many written conditions, how soon will it be before sales numbers collapse further, and vendors/purchasers get embroiled in legal posturing as prices go further downhill. Always worrying when the trough feeders, mortgage brokers and the rest come across on media asking for LVR restrictions to be removed. Oddly enough, Barfoots which has a sales page has suddenly denied access to historical data. August sales must be going gangbusters.. Many real estate "consultants" lurk on these pages, tell me I am wrong.

Cow Pat yes the tell tale signs , make it easier for us to keep on getting our huge commissions .