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    Michael Cornips

    Michael Cornips is the Managing Director and Founder of Emerald Financial.

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  • How the Chevron Doctrine decision could shake the environment and investors

    The Chevron Doctrine is referring to the US Supreme Court’s decision 40 years ago, giving deference to the Environmental Protection Agency’s (EPA) answer or interpretation of environmental laws. It was coined after a landmark case, Chevron USA, Inc. v. Natural Resources Defense Council, Inc. On June 28, 2024, in Loper Bright Enterprises v. Raimondo, the Supreme

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  • Why a tsunami of liquidity might be on its way

    World financial markets are addicted to liquidity to maintain the price level of assets. In a move reminiscent of the over-lending in the 2008 GFC asset bubble, Congress is voting on allowing lending on Second Mortgages by Federal Agencies in a move that could lead to a tsunami of liquidity. Congress recently approved a pilot

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  • A quick explainer on Hybrids and why people trade them

    ASX hybrid securities are financial instruments listed on the Australian Securities Exchange (ASX) that combine features of both equity and debt securities. These hybrids offer investors a blend of the characteristics of bonds and shares, providing unique benefits and risks. Understanding ASX Hybrids Hybrid securities can take various forms, including convertible bonds, preference shares, and

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  • APRA to strengthen bank capital requirements and liquidity standards

    The Australian Prudential Regulation Authority (APRA) is proposing several changes to strengthen bank capital requirements and liquidity standards in response to the global banking turmoil earlier in 2024. Here are the key proposed changes: Valuing liquid assets at market value APRA is proposing to require banks subject to the Minimum Liquidity Holdings (MLH) regime to

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  • PYC Therapeutics receives Orphan Drug Designation for ADOA treatment

    PYC Therapeutics (ASX: PYC), a clinical-stage biotechnology company, has achieved a significant milestone with the U.S. Food and Drug Administration (FDA) granting Orphan Drug Designation (ODD) to its investigational drug candidate, PYC-001. This precision therapy is designed to treat Autosomal Dominant Optic Atrophy (ADOA), a rare and progressive blinding eye disease. This designation is expected

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  • Interest rates – higher for longer

    Bond yields rose last week as the market absorbed the Central Banks determination to keep short term rates higher for longer in an attempt to kill the inflation impulse. Markets believe in the short term that Central Banks will raise interest rates once or twice more but are certainly convinced, in the longer term, thatRead More
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  • The great tax heist

    Published monthly financial statements show that, on an annual basis, the Government has firmly moved into a budget surplus. On an annualized basis, Individual tax receipts are growing at 13% pa, and company tax receipts are growing at 17% pa. Despite a slowdown in receipts through Covid, from January 2020 to April 2023, total revenue

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  • What’s up with the Grayscale Bitcoin Trust?

    What’s up with the Grayscale Bitcoin Trust?  The “Trust” part is what is in question. Bitcoin has been falling in price lately, with the price hovering around $15,700 as of this writing. This has caused a lot of investors to investigate whether or not it’s a good investment. One way to invest in Bitcoin isRead More
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  • In the wake of MYOB, is Reckon now one of the most undervalued stocks on the ASX?

    At the heart of ANZ’s rumoured takeover of accounting software company MYOB is the customers. The business customers that bring potential cross-selling opportunities into ANZ’s primary services is the underlying motive for the talks because businesses spend a hell of a lot more dough on their banking services than they do their accounting software.  So

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  • Fed’s Interest Rate expectation policy and yield curve inversion

    The market doesn’t like surprises, and the Federal Reserve is not going to give any. The Federal Reserve has moved to clearly signal interest rate policy, lest the market has any panic with unexpected moves. The current Fed Fund rate of .30% does not reflect their intentions going into the future. Some believe that a

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  • Annual petrol price inflation = 62%, yet CPI = 3.5%? What gives?

    Do you ever get the feeling that when the ABS tell you the inflation rate is 3.5% for the year, that something just seems wrong? Go to the supermarket and don’t tell me a basket of goods hasn’t substantially increased in price. Meat and Livestock Australia said retail prices are up 10 per cent per kilogram compared

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  • What is SWIFT and why it is important?

    The SWIFT system stands for the Society for Worldwide Interbank Financial Telecommunication and is a secure platform for financial institutions to exchange information about global monetary transactions such as money transfers. Set up in 1973, it is a crucial part of the plumbing that facilitates flows of money around the world. It is operated as a co-operative

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  • Rising interest rates – A tale of two perspectives

    Let’s be honest; not that long ago investors around the world would have thought that interest rates would never go up again. Since the GFC tens of trillions of debts has been conjured up by the various governments around the world and pumped into their respective economies. The inflation needle barely moved towards 2%. But

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  • The City of London is a Corporation

    A story of a diminished British Empire after the second world war, and how its financial center, the City of London, rose to international prominence by developing the largest offshore shadow banking US dollar market – the Eurodollar market. Many people would be unaware of the massive offshore US dollar market – a market that

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  • Uranium stocks blast off

    Local Uranium stock – Paladin Energy (PDN), has been trending up since November 2020, rising from .12c to a recent high of $1.00. The price of Uranium really took off in August when respected global asset manager, Sprott Global Asset Management launched the Sprott Physical Uranium Trust. Sprott specialize in physical gold, silver, and commodity

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  • Bitcoin Update – the Halving, ASIC & Transaction statistics

    This is just a quick refresh on the operations of the Bitcoin (BTC) blockchain. BTC commenced in 2009 with an original 10,500,000 Bitcoins mined. The maximum total BTCs to be issued is 21,000,000. Miners are rewarded for each Block they successfully mine, currently they are receiving 6.25 BTC as a reward. After every 210,000 Blocks

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  • Emerald Financial Research Note – Class Ltd

    Last week, the Advisors at Emerald Financial recently released a Buy report on Class Ltd (ASX: Cl1). Key Highlights include: • Existing market leader by revenue in the Superannuation admin sector with 99% client retention; • Expansion strategy commenced in 2019 to add new verticals • Total addressable market increased 2.5x from $140m to $365m;Read More
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  • ASX rebates clearing fees to Option traders

    The ASX fee clearing rebates for January hit clients’ accounts last night (26th February 2021). From the ASX: “To help promote growth in the equity options market, ASX will introduce an Options Liquidity Growth Program in the form of fee rebates for three months from 1 January through to 31 March 2021. The three-month fee rebate

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  • Hodlers, and Bitcoin Halving – some Bitcoin mechanics

    At 10:03 a.m. UTC on Dec. 18, GameKyuubi posted “I AM HODLING,” a drunk, semi-coherent, typo-laden rant about his poor trading skills and determination to simply hold his bitcoin from that point on. “I type d that tyitle twice because I knew it was wrong the first time. Still wrong. w/e,” he wrote about the

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  • GameStop is not the only short squeeze game

    You can look at stocks which have a short interest of over 20 percent here. https://www.highshortinterest.com/ Demonstrating that Gamestop and AMC Entertainment are not the only stocks witnessing dramatically higher share prices due to a short squeeze, the table below shows that all the most shorted stocks have seen dramatic increases in their share price since

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  • Gold is a risk-free asset (but not a risk free investment)

    A fact that is not widely known is that the Bank of International Settlements (BIS), under Basel lll, changed the risk weighting of gold that Banks hold on their balance sheets. The Bank for International Settlements is an international financial institution owned by central banks. BIS “fosters international monetary and financial cooperation and serves as

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  • US CPI increases in September

    The US Bureau of Statistics said that in September, the CPI rose .2%, rising 1.4% over the last 12 months. Annual CPI has moved from 0.10% in May 2020 to the current level of 1.40%. Food inflation is currently running at 3.90%, Medical care services rose 4.90%, Education and communication rose 2.10%. Offsetting these gains

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  • A generational shift in the economy and financial markets has occured

    There has been a generational shift in the world economy and financial markets because of COVID-19. Where we may live in a non-COVID environment soon, the markets, the economy and social environment may have been changed forever. The structures that have been around for 30 or 40 years have been upended. During World War 2

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  • Home lending growth flashes red

    Forget about percentage moves, the annual increase in home lending, that is, owner-occupied and investor credit combined, has fallen to only $10 billion for the year. The last time we saw that dollar increase in home lending was 30 years ago – right in the middle of the last recession. Given the size of home

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  • It’s the debt, stupid

    Stand back and take a look at the Australian Government’s outstanding debt position over 17 years and ask yourself whether the politicians words of “fiscally conservative”, “balanced budget”, “ensure all new expenditure is funded”, and variations of “surplus, surplus, surplus” actually mean anything. It looks like a straight line, and sure, there have been times

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  • Analysis: Budget Blues

    Figures show that the budget deficit is currently running at $44 billion per annum. As the handouts kicked in, the monthly deficit for April 2020 was $13 billion, with the expectation that there will be similar deficits until September. The Australian Government publishes “Commonwealth Monthly Financial Statements” that allows us to track rolling 12 months budget surplus/deficit

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  • The dark side to becoming a ‘Sophisticated’ Investor

    Business Insider published an article in 2013 about the pitfalls of being designated a ‘Sophisticated” Investor, a situation that still applies today. Under the Australian Corporations law, anyone earning $250,000 for two years or holding $2.5m in net assets can be designated a sophisticated investor or wholesale investor and therefore are excluded from the extensive retail client

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  • Betting the farm – Berkshire’s long-term decline in performance

    The legend that is Warren Buffet is entrenched into the psyche of the investment world. Listening to his presentations over the years demonstrated a wisdom to distil the most complicated investment topic into a down-to-earth homespun explanation, that never ceased to amaze. His mantel as teacher and guru will persist long into the future. His

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  • US Federal Reserve Repo Hysteria

    The media reporting of the US Federal Reserve providing temporary liquidity to primary dealers, via re-purchase (repo) agreements, appears to overstate the funding stress in this market. The repo market is where primary dealers borrow cash from the Federal Reserve for a short period of time against securities like US Treasury notes or mortgage backed

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  • ‘Head-scratcher’, mid-year budget revenue forecasts in detail

    It is always a bit of a head-scratcher when it comes to Government budgets and where they think an additional $72 billion in taxes will be coming from, on top of $456 billion collected in the 2019 year. The chances of them hitting their targets is about the same as mine hitting the dartboard at

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  • A not so merry Christmas? – Lending growth slows

    Despite the recent mini boom in home prices, higher auction clearance rates, and bullish media commentary, the sentiment is simply not showing up in credit statistics released today. Investor home lending growth is slightly in negative territory and personal credit growth is further accelerating its decline with negative 4.74% annual growth. Business lending growth is

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  • Retail sales beware: Annual change in GST receipts turn negative

    Finance.gov.au released components of taxation revenue for the month of October 2019. Combining these figures into a time series dating back to 2014, we get to look at the 12 months annual changes in various Government tax receipts. Annual Goods and Services tax (GST) to the end of October 2019 came in at $65.9 Billion,

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  • Credit growth is lower than GFC levels

    The RBA credit aggregates released at the end of October shows that Total Credit in the Australian economy contracted by $3.8 billion in the 3 months to the 30th September 2019. The lowest figure reached in the GFC was a contraction of $2.2 Billion in November 2009. This fall in lending is reflected in the majorRead More
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  • Death by taxes…or how do you balance a Federal Budget?

    If you think that the Federal Government’s mantra of a balanced Federal Budget is not contractionary for the economy, then you probably would be wrong. The Government publishes monthly budget figures (www.finance.gov.au), so you can establish the annual growth rates of the various components of taxation. To balance the budget, you need to increase taxation.Read More
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  • This is not fine… Growing the economy using debt is creating a bigger problem

    Let’s face it – Australia is a debt junkie. Australia has zero chance of growing the economy (ie increasing GDP) without borrowing every dollar of the increase to do it. In fact, since March 2000, it has taken an average of $2 increase in borrowing for every $1 increase in Gross Domestic Product (GDP). The

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  • This is what a balanced Federal budget looks like

    Last week the Treasurer, Josh Frydenberg, revealed that the 2018 – 19 budget showed a deficit of only $690m. The Treasurer said: “Our strong fiscal management has put the budget on a sustainable trajectory, ensuring that we can guarantee the essential services that Australians need and deserve”. The Government frames a balanced budget as basically

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  • The Re-Invention of Lying – Reverse Factoring

    Traditional factoring is when a company wants to borrow against receivables, ie money owed to them for supplying a product or service. Reverse factoring is when a company owes money and it wants to delay making that payment. For example, a company is much better off, in cash flow terms, if they can make the

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  • The Great Wealth Destruction that is AMP

    2003 was a big year for AMP. It is interesting to watch the journey AMP has made, with the hopes of many small shareholders looking to the big Australian to provide reliable custodianship of their hard-earned dollars. We start 2003 with the share price at $11.18 and a market capitalisation of about $13 billion. In

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  • The costs of the new-age investment platforms

    Investment Platform HUB 24 (ASX:HUB) recorded nearly $1 Billion of net inflows for the three months ending 30th June 2019

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  • The active investment VS passive investment debate

    The S&P Dow Jones has been reporting regularly on the active versus passive debate since 2002, releasing reports every six months

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