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

Which generation had it toughest?

Each generation believes its economic challenges were uniquely tough - but what does the data say? A closer look reveals a more nuanced, complex story behind the generational hardship debate. 

Maybe it’s time to consider taxing the family home

Australia could unlock smarter investment and greater equity by reforming housing tax concessions. Rethinking exemptions on the family home could benefit most Australians, especially renters and owners of modest homes.

100 Aussies: seven charts on who earns, pays, and owns

The Labor government is talking up tax reform to lift Australia’s ailing economic growth. Before any changes are made, it’s important to know who pays tax, who owns assets, and how much people have in their super for retirement.

The best way to get rich and retire early

This goes through the different options including shares, property and business ownership and declares a winner, as well as outlining the mindset needed to earn enough to never have to work again.

A perfect storm for housing affordability in Australia

Everyone has a theory as to why housing in Australia is so expensive. There are a lot of different factors at play, from skewed migration patterns to banking trends and housing's status as a national obsession.

Chinese steel - building a Sydney Harbour Bridge every 10 minutes

China's steel production, equivalent to building one Sydney Harbour Bridge every 10 minutes, has driven Australia's economic growth. With China's slowdown, what does this mean for Australia's economy and investments?

Latest Updates

Economy

Why we should follow Canada and cut migration

An explosion in low-skilled migration to Australia has depressed wages, killed productivity, and cut rental vacancy rates to near decades-lows. It’s time both sides of politics addressed the issue.

Investing

Simple maths says the AI investment boom ends badly

This AI cycle feels less like a revolution and more like a rerun. Just like fibre in 2000, shale in 2014, and cannabis in 2019, the technology or product is real but the capital cycle will be brutal. Investors beware.

Property

Australian house price speculators: What were you thinking?

Australian housing’s 50-year boom was driven by falling rates and rising borrowing power — not rent or yield. With those drivers exhausted, future returns must reconcile with economic fundamentals. Are we ready?

Shares

ASX reporting season: Room for optimism

Despite mixed ASX results, the market has shown surprising resilience. With rate cuts ahead and economic conditions improving, investors should look beyond short-term noise and position for a potential cyclical upswing.

Property

A Bunnings play without the hefty price tag

BWT Trust has moved to bring management in house. Meanwhile, many of the properties it leases to Bunnings have been repriced to materially higher rents. This has removed two of the key 'snags' holding back the stock.

Investment strategies

Replacing bank hybrids with something similar

With APRA phasing out bank hybrids from 2027, investors must reassess these complex instruments. A synthetic hybrid strategy may offer similar returns but with greater control and clearer understanding of risks.

Shares

Nvidia's CEO is selling. Here's why Aussie investors should care

The magnitude of founder Jensen Huang’s selldown may seem small, but the signal is hard to ignore. When the person with the clearest insight into the company’s future starts cashing out, it’s worth asking why.

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.