Monthly Archives: February 2019

Del Piero knows silverware but not the ‘Holy Grail’

The grounds of Budgewoi Football Club. Budgewoi Football Club.
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Alessandro Del Piero faces the media in Sydney yesterday.

FROM the Stadio Olimpico in Rome to the humble surroundings of Budgewoi?

Until last night, this was the fate set to be bestowed on one of the greatest footballers of all time, Alessandro Del Piero.

”Our Holy Grail” – perhaps a more apt description for the 70,000-seat Olimpico – is how the Budgewoi Football Club website describes the modest Budgewoi Sports Complex on the central coast.

Pleasant a facility though it is, it could have hosted one of the most eagerly anticipated football events of 2012: Del Piero’s first match in a Sydney FC shirt.

It was there that Sydney were due to face the Newcastle Jets in a friendly match this Saturday, set to be held behind closed doors.

You couldn’t get a venue further removed from the place where Del Piero played his last competitive match. It was at the Stadio Olimpico, in front of a packed house, where his club of two decades, Juventus, faced Napoli in the Coppa Italia final on May 20.

Napoli won 2-0, but when Del Piero was substituted in the 68th minute both sets of fans gave him a standing ovation.

However, amid the exploding interest in Del Piero’s arrival – and the certainty of thousands trying to get a glimpse of Saturday’s clash – the match was cancelled last night by Newcastle, the host club.

The match could still be played elsewhere if the clubs can agree on a venue, but Sydney officials confirmed last night that they had no say on where the match would be played if it were to go ahead.

Del Piero now has just 18 days to prepare until his first A-League match for Sydney, away to Wellington Phoenix, on October 6.

The club has only one game left before the season proper – another closed-doors friendly, against Central Coast at Macquarie University on September 27.

Asked about his fitness at his first official news conference at the Star casino yesterday, Del Piero said he wouldn’t have any problems, having worked out with a team in Turin.

”I am coming from two months training with my personal trainer and with a young team in Italy,” he said. ”I do everything I can do to stay in better condition.

”Now I need to go with the team, to know the other players, the coach [and] what he needs.”

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Winning way gives Del Piero broad shoulders

“I have a lot of things to do in two years” … Alessandro Del Piero.NO PLAYER in any domestic football code will know the weight of expectation on Alessandro Del Piero’s shoulders when he makes his debut for Sydney FC next month, but the $4 million man wouldn’t have it any other way.
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As he fronted the Australian media for the first time at the Star casino in Pyrmont, Del Piero said predictions that he could propel Sydney to their third A-League title did not faze him one bit.

“It is clear that there will be a lot of pressure to produce, but I think this is just the first step,” he said. ”I am used to this, and I love that. I played 19 years with Juventus – and in Juventus you have to win every game, every year. Fortunately a lot of the time that happened – but all my life I play for winning. I’m here for winning … I’m here because I trust in the win.”

Few players have revelled in the spotlight as much as Del Piero over the course of his brilliant career. Expectation is something he has grown up with – right back to when he broke into the first team at Padova at just 16.

After all, this is the same player who went on to score in a Champions League final, rammed home 27 goals for the Italian national team and scored a hat-trick on his full Serie A debut in 1993 at the age of 19.

However, when asked about what he hoped to achieve by the end of his two-year stint, at which stage he will be 39, Del Piero did not want to put a cap on it.

”I don’t know now. I have a lot of things to do in two years,” he said. “The most important thing is to stay focused on this moment, the present. It is a big change for me. I want to work in the present because I don’t know what happens later.”

Those involved in the deal to bring Del Piero to Australia have dubbed the move ”Project Sydney”, and the Italian is determined to provide the A-League with the boost it has been missing since it began in 2005.

”It is a very interesting project. Sometimes I decide with my feelings, but this was with my heart, head and feet,” he said. ”First of all I am here for Sydney FC and competing for Sydney FC. Then we hope [it is] about the A-League growing up day by day, and this is hard work.”

Asked how those closest to him reacted to his decision to choose Sydney over other clubs that wanted his signature, including Liverpool, Celtic, FC Sion and Olympiacos, Del Piero said they took some convincing.

”Most of my friends said: ‘OK, you want to change, but there’s a lot of places closer,”’ he said. ”I said, I know, but that I chose the best place.”

The change in conditions from the European winter to the southern hemisphere summer has caused problems for many players coming to the A-League, even Sydney’s Australian marquee signing Brett Emerton said it was an issue, but Del Piero seemed relieved by it.

”It’s different from Italy,” he said. ”It’s not -5 or -10 degrees. There [football in summer] does not happen. This is good for me.”

Convincing the eldest of his three children, five-year-old Tobias, about moving to Australia involved invoking the promise of spotting local wildlife.

”I promised to my son we’ll see kangaroos … my son said: ‘Ok, I’m happy,”’ Del Piero said, declaring he wanted his family to embrace the Australian lifestyle as much as possible. ”We hope to ‘live Australian’ in every part of every situation.”

He said he was aware the country had a rich football history, largely as a result of the postwar immigration. ”I know there has been a lot of Italian, English, Greek, Croatian and Yugoslavian immigrants … [people] from all over the soccer world.”

The reception he had at Sydney Airport on Sunday morning, with more than 500 fans turning out, was unlike anything seen for an individual footballer in this country, and Del Piero said he was delighted by the welcome. ”Yesterday was fantastic, I really appreciated it,” he said. ”The fans, this was perfect for me … It was a surprise but a good surprise.”

This story Administrator ready to work first appeared on Nanjing Night Net.

Dividend imputation – $20bn for the taking

REMEMBER Kevin Rudd’s mining tax? It needed some tweaking in industry’s favour, but even then it would have hauled in massive revenue without harming investment, which is the holy grail of tax policy. So, the government planned to use it to fund a bonanza of sensible giveaways including lowering the company tax rate from 30 to 25 per cent.
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When the miners invested in a scare campaign with even higher rates of return than their mines, the rest of the business community had to answer that great question in life posed most recently at the Spice Girls’ performance at the London Olympic closing ceremony: ”Tell me what you want, what you really, really want.”

When push came to shove, few businesses and even fewer business associations campaigned for the package even though it was far and away the best break they were likely to get in a good while. It just wasn’t what they really, really wanted.

And so, here we are again, two years on, with business still seeking lower company tax. Government has put the challenge to business again saying it will cut company tax, but only if the Business Tax Working Group, comprising business, unions and tax experts, can identify which business tax concessions should be removed to fund it; the problem is, without ”Mining Tax Mark 1” the choices are much harder.

However, the removal of a single business tax concession could fund company tax reductions down to about 19 per cent. The dividend imputation scheme introduced in 1987 ended the double taxation of company profits by relieving Australian shareholders of personal tax payments on their dividends to the extent that their companies had already paid company tax.

Paying tax twice seems daft and unfair. But it costs a bomb – which raises that Spice Girls question. Is it ”really, really” the best thing we could be doing with more than $20 billion in tax revenue? It would be hard to forgo that kind of money in business tax without doing some economic good by lowering business’s cost of capital, but, by god, dividend imputation does it. Let me explain.

If dividend imputation lowers the cost of capital, it does so by increasing the demand for Australian shares and thus raising their price. But foreigners don’t benefit from imputation credits. So, abolishing dividend imputation to fund company tax cuts lowers tax on foreigners and increases it on domestic shareholders. And because Australian shares are such a small part of foreign investors’ portfolios, foreigners are much more responsive to changes in after-tax returns than Australian investors.

For instance if, in response to the changes, foreign investors raised their allocation to Australian equities from 3 to 4 per cent, that’s a third more foreign investment; while domestic shareholders would be far less responsive. What I’m proposing would even come with its own compensation package for those domestic shareholders that wanted to put their money elsewhere – they’d be able to sell out at new price highs.

This isn’t just theory. Econometric studies of the introduction of imputation in 1987 suggest that it didn’t increase share prices. Conversely, when British pension funds were recently stripped of similar imputation credits, foreign buyers snapped up the few shares offloaded by British funds with negligible price falls.

The BTWG knows all this, observing: ”In small open economies like Australia, the marginal investor is likely to be a foreign investor.” Which calls into question ”whether dividend imputation is likely to significantly lower the cost of capital for Australian companies”.

Put more bluntly, $20 billion of business tax revenue does not stimulate investment. One could do as much good for the economy by dispatching random cheques to Australian households. No wonder that, as they compete to attract each others’ capital, European countries have moved away from dividend imputation.

Then, in the next breath, the BTWG argues that dividend imputation is outside its remit, that its terms of reference seek to quarantine its deliberations to the business tax system. Call me quirky, but I’d say that dividend imputation is part of the business tax system.

So, I’ll tell you what I want, what I really, really want. I want the BTWG to consider these arguments and put them to government – preferably as recommendations, but, failing that, as clear observations rather than asides.

Do I expect our beleaguered government to jump on such an insight right away? No. But in Australian policymaking, such an insight has usually been the foundation for real progress, if not immediately then over a few electoral cycles as the inevitable crises rob governments of politically easy options and as political parties jockey to persuade us they’ve got a serious reform agenda to keep us, ahem … moving forward.

Nicholas Gruen is chief executive of Lateral Economics.

This story Administrator ready to work first appeared on Nanjing Night Net.

Stocks edge up but volumes well down

THE sharemarket yesterday rose to its highest close since early May, lifted by the miners, as a recent recovery in commodity prices and a flurry of central bank stimulus fuelled hopes for stronger global growth and demand.
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The benchmark S&P/ASX200 Index rose 12.5 points, or 0.3 per cent, to 4402.5, while the broader All Ordinaries gained 11.6 points, or 0.3 per cent, to 4421.8.

The materials sector led the move, rising 1.9 per cent, and goldminers rose 2.2 per cent. Consumer staples and discretionary fell 0.6 and 0.4 per cent respectively, while industrials lost 0.6 per cent.

Meanwhile, the Australian dollar consolidated its gains from last week, trading around US105.4¢. Over the weekend, it jumped past the US106¢ mark, its highest point in six months.

Investors continued to dive into mining stocks on the back of the US Federal Reserve’s third round of quantitative easing to stimulate the fragile US economy.

”It’s probably a two-part story, not only is there a confidence boost from the quantitative easing from the Europeans and the Americans, but also the fact we’ve seen commodity prices rise in the last week or so,” said Darryl Conroy, market analyst at Suncorp Banking.

”Specifically metals have performed very well. Of course, iron ore, popping back over $US100 a tonne, has probably given our mining sector a much needed confidence boost as well,” Mr Conroy said.

BHP rose 84¢, or 2.5 per cent, to $34.15, while Rio Tinto added 92¢, or 1.6 per cent, to $57.50, Iluka Resources jumped $1.06, or 10.2 per cent, to $4.35.

Investors are keenly awaiting an announcement from Fortescue Metals about the restructuring of its debt. The troubled miner entered a trading halt on Friday after spiralling more than 14 per cent on Thursday last week.

Australia’s largest goldminer, Newcrest Mining continued its upward push, adding 76¢, or 2.7 per cent, to $29.12.

Gold traded around six-month highs, at around $US1770 an ounce.

All the big banks posted gains, with Westpac leading the charge, rising 31¢, or 1.3 per cent, to $24.42, ANZ added 16¢, or 0.7 per cent, to $24.39, NAB increased 7¢, or 0.28 per cent and CBA remain flat, adding 1¢ to finish at $55.29.

Retailers dragged on the market, department store David Jones lost 7¢, or 3 per cent, to $2.23, rival Myer fell 2¢, or 1.1 per cent, to $1.83.

Woolworths dropped 30¢, or 1 per cent, to $28.56, while Wesfarmers finished relatively flat, down 2¢ , to $24.53.

Mr Conroy said yesterday’s gains should be taken with a ”grain of salt”, as volumes remained low, indicating investor caution.

Average trading volume for the ASX200 is 820 million shares traded, while on the day, volume was below 680 million.

”One thing that is probably certain: more volatility to come,” Mr Conroy said.

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Benchmark index looks set to make a run towards 4800

IT’S been a tough few years for share investors but for the first time in a long time there is some good news coming from the Australian sharemarket.
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As this week’s analysis provided by Alan Clement, an international futures trader and member of the Australian Technical Analysts Association, shows, the

S&P/ASX 200 Index has been trading within the symmetrical triangle formed by the two dashed red lines on the chart since 2009.

In heavy selling in mid-2011 the index was sent tumbling from the upper boundary of the triangle to the lower boundary in one quick move, which ultimately exhausted the sellers and marked the low point for the year.

Following that fall, the market spent seven months consolidating in a tight wedge formation, only to fall through the bottom last May.

Buyers then quickly stepped in following the breakdown and have since pushed the market higher to recover almost all the losses, turning May’s selloff into a “higher low”, which Clement sees as a bullish sign.

At present the index is testing resistance at 4370 and actually broke through this level last Friday. However, we may see a short-term pullback as the market struggles around this resistance point.

“Ultimately, though, the market looks poised to break through the resistance and make for the upper boundary of the triangle, currently at around 4780,” Clement says.

While Australia’s economy is better than its US counterpart, Clement sees two factors holding our market back as Wall Street nears 2007 highs. The first is a high correlation with commodities markets, which are in consolidation phases of their own at present, with many commodity prices weakening this year. The second is the high Australian dollar, which stifles overseas investment by making stocks comparatively more expensive.

Those factors could impede upward momentum in the market. If and when the S&P/ASX 200 reaches the upper boundary of the symmetrical triangle there is more likely to be further consolidation within the triangle between 4700 and 4100 for about the next six months than an immediate move to the upper resistance level of 4900, Clement says.

Keep an eye out for a breakout from the triangle in either direction before the year’s end, as that would demand a rethink of strategy. Investors can gain exposure to the ASX 200 Index via CFDs, the SPI futures contract or exchange-traded funds such as State Street’s STW.

This column is not investment advice.

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This story Administrator ready to work first appeared on Nanjing Night Net.