A roundup of what The Globe and Mail's market strategist Scott Barlow is reading today on the Web.
Housing market discussions can get emotional in a "they took out too much debt and they must be punished!" kind of way, but DBRS has helped lower the temperature by publishing a detailed report outlining the current state of fundamentals in the Canadian real estate market. I posted my picks for most important charts on social media,
"@SBarlow_ROB DBRS: "amount of disposable income allocated toward interest payments has continuously decreased" – (chart) Twitter
"@SBarlow_ROB DBRS: Cdn mortgage defaults and unemployment rate" – (chart) Twitter
"@SBarlow_ROB DBRS: Canadian mortgage issuance breakdown" – (chart) Twitter
"The ballyhooed 'war on homebuyers' isn't real" – Maclean's
The last chart implies that unemployment is a far more important housing metric than many believe.
Societe Generale analyst Kit Juckes put it best this morning by noting that "Higher Oil prices are the main feature of the mkt this morning." Global crude markets are heading steadily towards a balance between supply and demand, ending glut conditions as demand continues higher,
"Oil Trader Trafigura Heralds End of 'Lower for Longer' Crude Era" – Bloomberg
"Oil demand may exceed supply by up to 4 million bpd by 2019: Trafigura" – Reuters
"Citi Says Get Ready for an Oil Squeeze" – Bloomberg
Canadian mayors are ramping up their sales pitches to attract Amazon.com Inc.'s new headquarters. In the Donald Trump era, Canada has a significant competitive advantage,
"'Amazon has something like 9,000 engineering jobs they can't fill. [Canada's] immigration policy is much more liberal,' Ottawa Mayor Jim Watson told the New York Times. 'That's where we have an advantage.'"
"Canada just escalated the $5 billion war for Amazon's second headquarters" – Business Insider
There is a lot about China's economy that has hallmarks of a Ponzi scheme – the country's own central bank has admitted that wealth management products are one of them – but the government is so willing to support any potential weak spots that it's virtually impossible to bet against growth continuing,
"Economist Xie Says China's Property Market a Ponzi Scheme" – (video) Bloomberg
"China's Crackdown Brings Developers Crashing Back to Earth" – Bloomberg
The robots that threaten jobs do not look like C-3PO,
"With [Robotic Process Automation, the task of replacing a stolen credit card] can be automated
and the Bank staff reallocated to more value-added work. In a real life example, software robots were deployed to take the initial information from the customer and then place that into the three back-end systems. A 25 minute process previously became almost instant and the bank saw a 6x productivity improvement - as well as lower card fraud rates as reported cards were cancelled more quickly."
"@SBarlow_ROB MS: Software, not C3PO, will take your job" – (research excerpt) Twitter
Tweet of the day: "@danmurtaugh Trafigura points out that oil prices rise every time @TheEconomist does a cover story on the death of the oil industry." – Twitter
Diversion: "The 10 biggest box-office bombs of 2017 so far, after a dismal summer" – Business Insider