Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 299

Cuffelinks Firstlinks Edition 299

  •   29 March 2019
  •      
  •   

The word 'disruption' is overused, often to describe a type of ongoing change we have seen for hundreds of years. But as the Federal Government sat down this week with large internet platforms to discuss new content laws, it highlighted the genuine 'disruption' caused by social media giants. They control and define more of what we see and how often we see it than any other companies or governments in history. And most of the advertising revenue.

Following the Christchurch terrorism, fund managers across Australasia are debating whether Facebook meets their ethical investing criteria. It's a crucial decision, as the company is one of the biggest global investments in the super industry. Vivid Social estimates there are 15 million Facebook users in Australia, or 60% of the population. Almost three million are over the age of 55.

It's amazing what we agree to when we sign up, such as allowing commercial use of everything we tell them, the pages we view, who we talk to, what we share, what we buy, who we are, what other sites we visit and even who is in our address book. Most of us are part of their success.

 


The Budget is on next Tuesday, and the Government is releasing snippets in advance. In complete contrast to the funding cuts of the past, ASIC and APRA will receive a record of over $550 million next year to 'help restore trust in the financial system'. Bank provisions for customer remediation will exceed $2 billion in 2019. APRA Chairman Wayne Byres said the regulator would strengthen oversight of governance weaknesses that are hurting retirement incomes.

It's a new world of compliance. While the industry funds came through the Royal Commissionwell, they are not beyond more scrutiny. Damien Klassen looks at the valuation of unlisted assets and the consequences for asset allocation. This week, AMP Chair David Murray said in a keynote address at The AFR Banking & Wealth Summit that the extent to which super funds have shifted into illiquid, unlisted assets is uncertain, making it difficult to know what would happen if the superannuation system faced fund outflows.

An edition packed with useful ideas

Last week, I sat down with global portfolio manager Barnaby Wiener to discuss asset allocation in an overvalued and risky world, and the insights went deep into investment philosophy.

A reader pointed to some confusion in the media about the treatment of franking credits in the 'direct investment' offers of industry funds, so we clarify the likely impact. 

Phil Ruthven is Australia's leading futurist and long-term thinker, and he shows the importance of housing in Australia, and gives his thoughts into when a turnaround in prices is likely.

5G technology promises to be one of those step-changes that connects and accelerates many developments, but Michael Collins warns there are more risks than usual.

Borrowing by SMSFs via LRBAs is back in the news, and John Chauvel and Adam Smithexamine the contrasting policies of the two major political parties.

Finally, Nathan Krieger expects financial advice changes to focus more on client goals.

In contrast to the article on not holding cash or bonds, the White Paper from Perpetual makes the case for a diversified portfolio, in the wake of the launch of its new listed Credit Income Trust.

Please comment on any of the articles, or use the Have Your Say section for other input. 

Graham Hand, Managing Editor

 

For a PDF version of this week’s newsletter articles, click here.

 


 

Leave a Comment:

     
banner

Most viewed in recent weeks

Raising the GST to 15%

Treasurer Jim Chalmers aims to tackle tax reform but faces challenges. Previous reviews struggled due to political sensitivities, highlighting the need for comprehensive and politically feasible change.

7 examples of how the new super tax will be calculated

You've no doubt heard about Division 296. These case studies show what people at various levels above the $3 million threshold might need to pay the ATO, with examples ranging from under $500 to more than $35,000.

The revolt against Baby Boomer wealth

The $3m super tax could be put down to the Government needing money and the wealthy being easy targets. It’s deeper than that though and this looks at the factors behind the policy and why more taxes on the wealthy are coming.

Meg on SMSFs: Withdrawing assets ahead of the $3m super tax

The super tax has caused an almighty scuffle, but for SMSFs impacted by the proposed tax, a big question remains: what should they do now? Here are ideas for those wanting to withdraw money from their SMSF.

Are franking credits hurting Australia’s economy?

Business investment and per capita GDP have languished over the past decade and the Labor Government is conducting inquiries to find out why. Franking credits should be part of the debate about our stalling economy.

Here's what should replace the $3 million super tax

With Div. 296 looming, is there a smarter way to tax superannuation? This proposes a fairer, income-linked alternative that respects compounding, ensures predictability, and avoids taxing unrealised capital gains. 

Latest Updates

Investment strategies

9 winning investment strategies

There are many ways to invest in stocks, but some strategies are more effective than others. Here are nine tried and tested investment approaches - choosing one of these can improve your chances of reaching your financial goals.

Planning

Super, death and taxes – time to rethink your estate plans?

The $3 million super tax has many rethinking their super strategies, especially issues of wealth transfer on death. This reviews the taxes on super benefits and offers investment alternatives.

Taxation

Raising the GST to 15%

Treasurer Jim Chalmers aims to tackle tax reform but faces challenges. Previous reviews struggled due to political sensitivities, highlighting the need for comprehensive and politically feasible change.

Shares

The megatrend you simply cannot ignore

Markets are reassessing the impact of AI, with initial euphoria giving way to growing scepticism. This shift is evident in the performance of ASX-listed AI beneficiaries, creating potential opportunities.

Gold

Is this the real reason for gold's surge past $3,000?

Concerns over the US fiscal position seem to have overtaken geopolitics and interest rates as the biggest tailwind for gold prices. Even if a debt crisis doesn't seem likely, there could be more support on the way.

Exchange traded products

Is now the time to invest in small caps?

With further RBA rate cuts forecast this year, small caps may be key beneficiaries. There are quality small cap LICs and LITs trading at discounts to net assets, offering opportunities for astute investors.

Strategy

Welcome to the grey war

Forget speculation about a future US-China conflict - it's already happening. Through cyberwarfare and propaganda, China is waging a grey war designed to weaken democracies without firing a single shot.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.