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With the Theatre of the Absurd continuing to play out in Washington - with the pretence that there is any risk that the banksters don't get their trillion bucks - and with Washington Mutual having been taken over by regulators... let's take a shot at understanding how hard it is to be a bank.
When you're a bank, you're protected from genuine open competition - you participate in a government-ordained oligopoly with limited competition from foreign entities.
When you're a bank, you gain a spread between your risible deposit rates (after fees, most deposit holders earn zero or negative net interest) and the rate at which you can loan money - which is set in an oligopolistic marketplace with endemic collusion.
When you're a bank, you can loan out a staggering multiple of the funds you have on deposit - earning the spread on the first multiple, and the entire rate on the remainder.
When you're an Australian bank, you have the added benefit that almost every wage-earner is forced to be paid by electronic transfer - employers have the right to refuse to pay people in cash: this necessitates more people having bank accounts than would be the case in a free society. No more yellow envelopes... but millions of $5 a month 'account keeping fees'.
When you're National Australia Bank, and your client does an international transfer, you use an exchange rate more than TEN CENTS above spot to convert from $A to Euro (spot at the time: $A1.7345 $A = 1€ ; rate used by NAB: $A1.8460 = 1€ ... plus a $4 fee!)... pocketing the difference. I am certain that conversions going the other way are similarly clipped.
When you're National Australia Bank, an outgoing payment is deducted in seconds... an incoming payment sits on their books for at least three days before it is credited to the customer's account.
In short, when you're a bank - particularly if you're NAB, who appear to be the absolute worst offender - the entire business landscape is tilted in your favour... and yet they manage to cock it up with misadventures like Homeside, and Australian banks' RoE does not reflect the massive monopoly power and entrenched privilege they enjoy. (Disclosure: I don't bank with NAB).
Bankers are the ones who - in every economy in which they have ever operated - have driven the major economic crises of the day. Every single one - from the John Law crisis in pre-Revolutionary France, to the manifold economic crises of the 19th century, through to the Great Depression. Of course they are always aided and abetted by politicians, who profit greatly alongside them as they drag the polity into a morass. Politicians are the coin-clippers and cheque-kiters of history - they who call each other "The Honourable Member for [X]"... but they are the only people apart from journalists and primary school children who think that the 'Honourable' bit of that nomenclature is merited.
A lot of dills throughout history have blamed, and continue to blame, the 'Red Sea Pedestrians' - they've been kicked out of country after country over the centuries (in some countries they were let back in, but then kicked out again years or even centuries later). They've been the 'short sellers' of history - blamed when crises have unfolded, simply because some of their number were lenders-at-interest (i.e., bankers).
My only beef with da Jooze is the same as my beef with the Musselmen, the Micks, the Protties, and snake-kissing speaking-in-tongues loonies from the Deep South in the US: namely, that they are all either delusional or frauds.
Delusional - or if you prefer, 'looney' - is what we call people who hear voices and who think that belonging to a group of similarly-delusional people confers inherent superiority. And those people who claim to hear voices but who actually don't are the frauds.
The 'looney' label also goes for anybody who thinks that there is a giant Sky Wizard who listens to them, or gives a flying rat's ass if they go to church/mosque/synagogue or not. And that goes for the lot of them... from Zulu witch-doctors to imams, to the Grand Rabbi and the Pope.
And don't tell me that religious faith is harmless. You might think it's sweet that someone's Nan believes in the Sky Wizard, and that it gives her solace now that Gramps is off the twig. But that very belief is exploited in every war, and the Nans of the day become the women who send white feathers to those who see through the sham. Nans are among the most bloodthirsty on the home front - because they believe in the Righteousness of The Cause. "Onward Christian Soldier" - a vile tale of the righteous wreaking of death and destruction on one's fellow men - was written by a middle aged woman 'believer'.
I included the Pope in the list above, even though anybody in such a position is highly unlikely to believe in God... like all positions of great power, to get there you have to spend an entire career positioning yourself: jostling for the eventual run at the throne. You are, thereby, a politician: venal, scheming and amoral. Look at Pope Rattie-of-the-Hitler-Jugend Ratzinger's eyes.
Now if I am wrong, and those who hear voices aren't delusional and are to be taken at their word, Charles Manson ought to be released immediately, 'coz he was acting under orders from the same Sky Wizard. Those orders were very consistent with the orders the Sky Wizard gave to Moses in the Old Testament - genocide, mayhem, butchery.
I usually try not to get into the whole shebang that revolves around the Eastern-European peasant pretenders currently occupying Palestine based on some spurious historical narrative, so I will stop here, and we will move on to the markets... where you don't have to believe in anything.
Major Market Indices
The All Ordinaries (XAO) declined about half a percent, dropping 26.2 points (0.53%), finishing at 4934.6 points. The index hit an intraday high of 5019.2 at 10:11 am, while the low for the day was 4874.4 - set at 2:10 pm Sydney time. To have bounced 60 points in the last two hours - on a Friday, with Mr Hankie's bailout still (supposedly) up in the air. There are folks betting (with some justification) that Paulson and his cronies will - surprise surprise - reach an agreement over the weekend, so that the usual Monday Morning Orgasm will be given a dose of crack and Viagra.
For the week, the Ords was up 94.6 points (1.9%).
Total volume traded on the ASX was 1.3bn units, 19% below its (slightly out of whack) 10-day average. The ASX's daily listing of all stocks included 1248 different 3-letter FPO's which traded (i.e., had non-zero trade volume). Of these, 404 issues rose, with volume in rising issues totalling 401.7m units; decliners numbered 561 counters, and between them they traded aggregate declining volume of 718.3m shares.
Of the 496 All Ordinaries components, 160 rose while 259 fell. Volume was tilted in favour of the losers by a margin of 1.9:1, with 296.91m shares traded in gainers while 554.2m shares traded in the day's losers.
The Index that forms the cash basis for the SFE's Share Price Index Futures - the S&P/ASX 200 (XJO) - fell mildly, losing 22.6 points (0.46%), closing out the session at 4904.8 points.
| Name | Close | +/-(%) |
|---|---|---|
| All Ordinaries | 4934.60 | -26.20 (0.5%) |
| ASX 20 | 2823.10 | 2.90 (0.1%) |
| ASX 50 | 4846.80 | -10.20 (0.2%) |
| ASX 100 | 4000.80 | -13.60 (0.3%) |
| ASX 200 | 4904.80 | -22.60 (0.5%) |
| ASX 300 | 4894.20 | -21.80 (0.4%) |
| ASX Mid-Cap 50 | 4806.60 | -58.00 (1.2%) |
| ASX Small Ordinaries | 2608.70 | -38.50 (1.5%) |
The "heavy hitters" of the Australian market - the ASX 20 Leaders (XTL) - advanced by under a percent, adding 2.9 points (0.10%), closing out the session at 2823.1 points.
The 21 stocks which make up the index traded a total of 192.13m units; 9 index components rose, with rising volume amounting to 67.15m shares, while the 10 decliners had volume traded totalling 73.32m units. The major percentage gainers within the index were
- Foster's Group (FGL), +$0.31 (5.79%) to $5.66 on volume of 12.2 million shares;
- Newcrest Mining (NCM), +$1.33 (4.84%) to $28.79 on volume of 4.2 million shares;
- National Australia Bank (NAB), +$0.81 (3.24%) to $25.80 on volume of 15.6 million shares;
- ANZ Banking Group (ANZ), +$0.48 (2.59%) to $19.00 on volume of 11.4 million shares; and
- CSL (CSL), +$0.50 (1.32%) to $38.26 on volume of 1.5 million shares.
On the less salubrious side of the big-cap fence, the following stocks were the worst-performed within the index:
- Woodside Petroleum (WPL), -$1.52 (2.65%) to $55.80 on volume of 3.9 million shares;
- Stockland (SGP), -$0.15 (2.54%) to $5.75 on volume of 3.6 million shares;
- Westfield Group (WDC), -$0.43 (2.43%) to $17.30 on volume of 6.3 million shares;
- Macquarie Group (MQG), -$0.94 (2.39%) to $38.31 on volume of 3.8 million shares; and
- BHP Billiton (BHP), -$0.56 (1.54%) to $35.84 on volume of 23.5 million shares.
At the other end of the market-cap spectrum lie the denizens of the ASX Small Ordinaries (XSO) . The small-fry swam in the opposite direction to the big fish today as the Small Ords registered a loss of 38.5 points (1.45%), closing out the session at 2608.7 points.
Among the stocks that make up the Small Caps index, 77 index components finished to the upside, and of the rest, 114 closed lower for the session.
The 208 stocks which make up the index traded a total of 310.66m units: volume in the 77 gainers totalling 124.03m shares, with trade totalling 172.77m units in the index's 114 declining components. The major percentage gainers within the index were- City Pacific (CIY), +$0.03 (13.89%) to $0.21 on volume of 224.9 thousand shares;
- Ridley Corporation (RIC), +$0.11 (11.22%) to $1.09 on volume of 413.9 thousand shares;
- Australian Education Trust (AEU), +$0.04 (10.29%) to $0.38 on volume of 164 thousand shares;
- Carbon Energy Ltd (CNX), +$0.06 (10.19%) to $0.60 on volume of 3.4 million shares; and
- Reverse Corp (REF), +$0.12 (8.22%) to $1.58 on volume of 92 thousand shares.
In the red-zone of the little-stock index, the following list represents the biggest downers (in terms of percentage decline):
- Rubicon Japan Trust (RJT), -$0.01 (19.35%) to $0.03 on volume of 4.2 million shares;
- Record Realty (RRT), -$0 (15%) to $0.02 on volume of 708.3 thousand shares;
- Lynas Corporation (LYC), -$0.1 (11.9%) to $0.74 on volume of 2.3 million shares;
- Paperlinx (PPX), -$0.24 (11.84%) to $1.75 on volume of 2.1 million shares; and
- Sino Gold Mining (SGX), -$0.49 (10.21%) to $4.31 on volume of 2.1 million shares.
Index Changes
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| XAO | All Ordinaries | 4934.6 | -26.2 | -0.53 | 954.4m |
| XFL | ASX 50 | 4846.8 | -10.2 | -0.21 | 354.9m |
| XJO | ASX 200 | 4904.8 | -22.6 | -0.46 | 765.5m |
| XKO | ASX 300 | 4894.2 | -21.8 | -0.44 | 892m |
| XMD | ASX Mid-Cap 50 | 4806.6 | -58 | -1.19 | 238m |
| XSO | ASX Small Ordinaries | 2608.7 | -38.5 | -1.45 | 299.1m |
| XTL | ASX 20 | 2823.1 | 2.9 | 0.1 | 188.6m |
| XTO | ASX 100 | 4000.8 | -13.6 | -0.34 | 592.9m |
Market Breadth
| ASX20 | XTO | XJO | XAO | XSO | Market | |
|---|---|---|---|---|---|---|
| Advances | 9 | 36 | 65 | 160 | 77 | 404 |
| Declines | 10 | 59 | 129 | 259 | 114 | 561 |
| Advancing Volume | 67.2m | 166.9m | 259.5m | 296.9m | 124m | 401.7m |
| Declining Volume | 73.3m | 357.4m | 476.9m | 554.2m | 172.8m | 718.3m |
GICS Industry Indices
Among the 11 industry indices, 3 registered an advance for the session, the remaining 8 lost ground.
The best performing index was Healthcare (XHJ), which added 88 points (0.96%) to 9256.7 points. The 9 stocks which make up the index traded a total of 11.18m units; 5 index components rose, with rising volume amounting to 7.86m shares, while the 4 decliners had volume traded totalling 3.32m units. The major percentage gainers within the index were
- Sigma Pharmaceuticals Ltd (SIP), +$0.07 (5.88%) to $1.26 on volume of 3.1 million shares;
- Cochlear (COH), +$0.78 (1.33%) to $59.56 on volume of 185 thousand shares;
- CSL (CSL), +$0.50 (1.32%) to $38.26 on volume of 1.5 million shares;
- Sonic Healthcare (SHL), +$0.08 (0.6%) to $13.38 on volume of 2.1 million shares; and
- Ramsay Health Care (RHC), +$0.04 (0.39%) to $10.30 on volume of 1 million shares.
Second in the index leadership stakes was Financials ex Property Trusts (XXJ), which gained 44.5 points (0.87%) to 5145.8 points. The 29 stocks which make up the index traded a total of 133.14m units; 13 index components rose, with rising volume amounting to 75.14m shares, while the 15 decliners had volume traded totalling 51.44m units. The major percentage gainers within the index were
- Allco Finance Group (AFG), +$0.02 (6.52%) to $0.25 on volume of 12.8 million shares;
- National Australia Bank (NAB), +$0.81 (3.24%) to $25.80 on volume of 15.6 million shares;
- ANZ Banking Group (ANZ), +$0.48 (2.59%) to $19.00 on volume of 11.4 million shares;
- ASX (ASX), +$0.80 (2.46%) to $33.30 on volume of 707.7 thousand shares; and
- HFA Holdings (HFA), +$0.02 (2.11%) to $0.73 on volume of 3.1 million shares.
The bronze medal for today goes to Consumer Staples (XSJ), which climbed 53.7 points (0.75%) to 7210.5 points. The 13 stocks which make up the index traded a total of 55.85m units; 6 index components rose, with rising volume amounting to 31.13m shares, while the 7 decliners had volume traded totalling 24.72m units. The major percentage gainers within the index were
- Foster's Group (FGL), +$0.31 (5.79%) to $5.66 on volume of 12.2 million shares;
- ABB Grain (ABB), +$0.45 (5.77%) to $8.25 on volume of 287.5 thousand shares;
- Goodman Fielder (GFF), +$0.03 (2.31%) to $1.33 on volume of 12.6 million shares;
- Australian Agricultural Company (AAC), +$0.05 (1.82%) to $2.80 on volume of 411.5 thousand shares; and
- Woolworths (WOW), +$0.20 (0.72%) to $28.10 on volume of 4 million shares.
The worst-performed index for the session was Property Trusts (XPJ), which dipped 36 points (2.42%) to 1452.5 points. The 21 stocks which make up the index traded a total of 151.44m units; The 15 decliners had volume traded totalling 104.16m units, and 5 index components rose, with rising volume amounting to 46.99m shares, The major percentage decliners within the index were
- Centro Retail (CER), -$0.01 (7.14%) to $0.13 on volume of 14.3 million shares;
- Mirvac Group (MGR), -$0.16 (5.65%) to $2.67 on volume of 3.4 million shares;
- ING Industrial Fund (IIF), -$0.09 (5.21%) to $1.55 on volume of 2.3 million shares;
- Goodman Group (GMG), -$0.15 (5.17%) to $2.75 on volume of 5.9 million shares; and
- Macquarie DDR Trust (MDT), -$0.02 (4.92%) to $0.29 on volume of 5.3 million shares.
Just missing out on the wooden spoon was Materials (XMJ), which slid 248.9 points (2.01%) to 12157.6 points. The 45 stocks which make up the index traded a total of 183.76m units; The 35 decliners had volume traded totalling 145.66m units, and 8 index components rose, with rising volume amounting to 36.39m shares, The major percentage decliners within the index were
- Lynas Corporation (LYC), -$0.1 (11.9%) to $0.74 on volume of 2.3 million shares;
- Paperlinx (PPX), -$0.24 (11.84%) to $1.75 on volume of 2.1 million shares;
- Sino Gold Mining (SGX), -$0.49 (10.21%) to $4.31 on volume of 2.1 million shares;
- Alumina (AWC), -$0.38 (9.92%) to $3.45 on volume of 8.5 million shares; and
- Aquarius Platinum (AQP), -$0.65 (8.28%) to $7.20 on volume of 482.6 thousand shares.
Third-to-last amongst the sector indices was Information Technology (XIJ), which slid 7.6 points (1.46%) to 513.5 points. The 2 stocks which make up the index traded a total of 1.87m units; The declining stock traded 1.4m units, and volume in the lone rising index component was 0.47m shares. The decliner was Computershare (CPU), -$0.16 (1.74%) to $9.01 on volume of 1.4 million shares.
Sector Indices
| Code | GICS Sector | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| XHJ | Healthcare | 9256.7 | 88 | 0.96 | 11m |
| XXJ | Financials ex Property Trusts | 5145.8 | 44.5 | 0.87 | 133m |
| XSJ | Consumer Staples | 7210.5 | 53.7 | 0.75 | 56m |
| XNJ | Industrials | 4615.7 | -1.5 | -0.03 | 115m |
| XTJ | Telecommunications | 1421.6 | -2.9 | -0.2 | 50m |
| XDJ | Consumer Discretionary | 1663.2 | -5.7 | -0.34 | 38m |
| XEJ | Energy | 17326.1 | -181.7 | -1.04 | 45m |
| XUJ | Utilities | 4703.4 | -52.7 | -1.11 | 36m |
| XIJ | Information Technology | 513.5 | -7.6 | -1.46 | 2m |
| XMJ | Materials | 12157.6 | -248.9 | -2.01 | 184m |
| XPJ | Property Trusts | 1452.5 | -36 | -2.42 | 151m |
All Ordinaries Major Movers
All Ords Volume Leaders
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| TLS | Telstra Corporation Limited. | 4.20 | 0.00 | 0 | 45.1m |
| OZL | OZ Minerals Limited | 1.73 | -0.12 | -6.23 | 42.3m |
| CNP | Centro Properties Group | 0.09 | 0.00 | 2.41 | 29.1m |
| BLY | Boart Longyear Limited | 1.30 | -0.06 | -4.07 | 26.5m |
| ADY | Admiralty Resources NL | 0.07 | -0.01 | -6.41 | 25.3m |
All Ords Percentage Gainers
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| BFG | Bell Financial Group Limited | 0.90 | 0.13 | 16.88 | 30k |
| CEG | CEC Group Limited | 0.22 | 0.03 | 16.22 | 76.9k |
| CIY | City Pacific Limited | 0.21 | 0.03 | 13.89 | 224.9k |
| PGA | Photon Group Limited | 2.70 | 0.30 | 12.5 | 2.1m |
| RIC | Ridley Corporation Limited | 1.09 | 0.11 | 11.22 | 413.9k |
All Ords Percentage Losers
| Code | Name | Close | +/- | % | Volume |
|---|---|---|---|---|---|
| EBB | Everest Babcock & Brown Limited | 0.21 | -0.09 | -30 | 103.7k |
| RJT | Rubicon Japan Trust | 0.03 | -0.01 | -19.35 | 4.2m |
| RRT | Record Realty | 0.02 | 0.00 | -15 | 708.3k |
| AXQ | Allco Max Securities And Mortgage Trust | 0.05 | -0.01 | -12.28 | 55.8k |
| LYC | Lynas Corporation Limited | 0.74 | -0.10 | -11.9 | 2.3m |
