Pesek on Asia: Sydney's Bubble Troubles
Good morning. Here's my take on some of the stories driving the debate in politics, finance and social issues across Asia today:
Bubble troubles in Australia
As Alan Greenspan does the talk show circuit to defend his legacy of bubbles and sell a new book, Glenn Stevens is on the front lines of renewed debate about the responsibility of central bankers to tame asset markets. As this Bloomberg News piece points out, Sydney is seeing home-bidding wars that rival New York. The challenge facing the Reserve Bank of Australia governor suggests Greenspan is just as wrong now as he was when he helmed the Federal Reserve. Australia's irrational exuberance needs taming and now.
Thai Senate steps up to save nation
Lawmakers are set to reject a proposed amnesty law for political offenses, and not a millisecond too soon. Prime Minister Yingluck Shinawatra's efforts to help her brother, former Premier Thaksin Shinawatra, ousted in a 2006 coup, to return to Thailand and reclaim some of his fortune have sparked giant protests. Will tensions now simmer down in the Land of Smiles? Don't hold your breath, not with Thaksin determined to carve out a place for himself in Thai politics once again.
Hong Kong's television drama
It's great to be a billionaire anywhere, but this enviable designation gets more traction in Hong Kong than perhaps anywhere else. Often touted as the world's freest economy, Hong Kong is also something of an oligarchy, dominated by a small handful of tycoons. Still, the government's murky decision to reject a startup’s application for a free-to-air television permit in favor of two tycoons was a perk too far. The decision sparked protests demanding an explanation and further dented Hong Kong Chief Executive Leung Chun-ying’s already low approval rating.
Malaysia as canary in Fed coal mine
Talk of Federal Reserve tapering is again dominating Asian markets, perhaps nowhere more than Malaysia. The ringgit was Asia’s best- performing currency last month as the Fed stuck with its unprecedented stimulus. Now its proving to be the region's most vulnerable as better U.S. data gives the Fed scope to scale back. The ringgit could just be Asia's canary in the proverbial coal mine.
China's newest challenge: terrorism
Explosions rocked Asia's biggest economy, this time near a Communist Party building in the northern city of Taiyuan in Shanxi province. The blasts, which killed one person and wounded eight, come at the worst possible moment for the Communist Party, on the eve of its Nov. 9-12 conclave to mull vital economic reforms. Security already has been on high alert following an incident where a sports-utility vehicle rammed into a bridge outside the Forbidden City near Tiananmen Square in Beijing. When China's top leaders meet this weekend, they're going to have a lot more to talk about than financial reforms and urbanization policy.
(William Pesek is a Bloomberg View columnist. Follow him on Twitter.)