Economists say the unrest in France is a warning signal for Australia's public spending and rising costs. Hundreds of thousands marched across France on Saturday over school underfunding and cost-of-living pressures. Economist Luke Hartigan said soaring energy costs are a major factor, but that France's high public debt and generous welfare state are the more fundamental problem. Public debt in France is nearly 120 per cent of the economy, compared with 53 per cent in Australia. Economist Bob Breunig called for an honest public conversation about what government can do and what it will cost.
Blackstone executive Jas Khaira has played down fears that debt funding the AI infrastructure buildout could trigger a credit crisis. He said the debt is largely backed by the most creditworthy companies, such as hyperscalers. Khaira acknowledged that rising borrowing costs and higher credit spreads have unsettled markets. Shares of CoreWeave fell more than 20% in recent days, and Firmus cancelled a planned listing on the Australian Securities Exchange. Khaira said the AI adoption gains across Blackstone's portfolio are real but uneven.
The Victorian Coalition plans to sell the Melbourne wholesale fruit and vegetable market if it wins the November state election. Shadow Agriculture Minister Emma Kealy says the sale would raise around $600 million to help pay down state debt and return the market to wholesalers or industry. Labor has ruled out a sale, so the election will decide the market's future. Agriculture Minister Michaela Settle says the sale would make groceries more expensive. Fresh State chief executive Jason Cooper has cautiously welcomed the idea of industry ownership.
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Economist Saul Eslake has warned that One Nation's plan to sharply cut migration could add almost $300 billion to Australia's debt. Speaking on Sunrise, he said large reductions in migrant numbers would hit government revenue, employment and public finances, since migrants work, pay tax and generally do not draw social security until retirement. He also disputed Pauline Hanson's claim that fewer migrants would ease housing costs, pointing to rising house prices during the COVID-19 period of negative net migration. Eslake said there is no single ideal migration figure for every economic situation.
Two economists have warned that Victoria's budget would worsen under a Coalition government, because planned spending cuts are not large enough to offset tax cuts. RMIT professor David Hayward estimates a $9 billion shortfall in the state's finances. Opposition Leader Jess Wilson has promised a cash surplus by 2032, partly funded by a 10-year freeze on public service hiring. Independent economist Saul Eslake said the Coalition must explain how it will reduce debt, and called for spending cuts and revenue increases.
The cost of insuring against big technology firms defaulting on their debt has reached record highs. Data centre operator CoreWeave has been hit hardest, with its five-year credit default swap spread soaring 16 per cent to a record 1.14 per cent this week before easing to 1.03 per cent. The company has taken on more than $US50 billion in debt. Analysts say rising inflation and interest rates are increasing borrowing costs, and investors are growing anxious. Market strategist Henry Jennings called CoreWeave the canary in the coalmine for excessive big tech debt on Wall Street.
Lauryn Hill, a former member of the Fugees, faced foreclosure on her New Jersey home in 2018 over nearly $1 million in unpaid property taxes. In 2012 she was charged after failing to file federal tax returns on income earned between 2005 and 2007. She was later jailed for three months after paying nearly $970,000 in back taxes. The New Jersey Division of Taxation has since placed two tax liens on her totalling more than $892,000. Her estimated net worth is now $500,000, and she still earns through tours and festival appearances.
Droughts in Afghanistan's Badghis province are pushing families to sell their young daughters into marriage to repay debts, buy food and pay for medical treatment. Families displaced from rural villages by drought often struggle to survive in towns and camps. Girls as young as two have been engaged, and some have married children or been married to much older men. Aid organisation World Vision International says early marriage exposes girls to serious health risks, while clinics treating them are closing as foreign aid is cut.
Frankston households struggling with mortgages, rent and everyday costs can get free, face-to-face financial help at Frankston Arts Centre on Tuesday 20 October. The Bring Your Bills day is run by South East Community Links. New data estimates 7,818 Frankston households are under mortgage stress, up 22.4 per cent over the past year. South East Community Links CEO Peter McNamara says many households are being pushed to put groceries on credit or delay bills. Services on the day include financial counsellors, banks, energy and water retailers, Centrelink and legal services.
AI data centre company Firmus has withdrawn its application to list on the ASX, scrapping one of Australia's biggest planned share market floats. The company cited recent market volatility and said the offer would not properly reflect its long-term growth prospects. It will now seek private market funding while considering other options. Investors reportedly pulled back over the high sale price of $11 a share and concerns about an AI bubble. UniSuper's chief investment officer said the company has a compelling story but not a compelling valuation, while Morningstar raised concerns about its heavy debt.
The anticipated ASX debut of data centre operator Firmus faces significant hurdles, with investment banks halting bids and concerns over its valuation and debt levels. Analysts have questioned the firm's financial health and the sudden increase in its market value. Goldman Sachs reportedly stepped in to prevent the IPO's collapse, while market participants criticised the float's roadshow for lacking detail. The company's planned data centres in Tasmania could strain local energy infrastructure, raising further concerns about its ambitious expansion plans.
Asian shares fell as debt markets faced pressure from major tech firms seeking billions in funding. Oil price rises added to the strain, while US 10-year debt yields dropped from 24-year highs. The euro hit 17-month lows amid concerns over European debt, with the dollar strengthening. SpaceX and Broadcom plan to raise significant funds for AI chip purchases, impacting their credit default insurance and share prices. Samsung Electronics forecast a 783 per cent profit jump but saw shares dip slightly. The Federal Reserve may raise rates again, with markets pricing in an 80 per cent chance for December.
A ‘Bring Your Bill’ event in Craigieburn helped 180 people, representing 314 individuals and family members, address around $1.8 million in debt and savings. The event, held by South East Community Links (SECL), allowed residents to work with service providers to reduce financial stress. SECL chief executive Peter McNamara said almost 12,000 households in the area are estimated to be experiencing mortgage stress. The organisation also offers assistance through community connectors at Broadmeadows train station.
