Top 10 at 10: Aussie home affordability crisis; UK capital gains tax hike; Gold cash machine; Dilbert

Here are my Top 10 links from around the Internet at 10am. I welcome your additions and comments below or please send suggestions for Thursday’s Top 10 at 10 to bernard.hickey@interest.co.nz 1. Here's what's needed - Paul Kedrosky at Infectious Greed has come up with a chart showing what various governments need to do to stabilise their public debt to GDP ratios. It shows how much they need to reduce their budget deficits as a percentage of GDP. Luckily for us, we have some of the smallest cuts necessary, but it's still a significant proportion of our GDP. Japan, the United States and Spain are in a worse position than Greece. Britain is close behind. Click on the chart to get a bigger version.

2. Surprise, Surprise - Australian housing affordability is slumping towards record lows, the Sydney Morning Herald reports. HT Gareth via IM.

The HIA/Commonwealth Bank survey of first-home buyer affordability dropped 4 per cent in the March quarter to its lowest since the September quarter of 2008. The index was almost 29 per cent lower than for the same period a year earlier, the Housing Industry Association said in a press release. ''Higher interest rates, exorbitant infrastructure charges, an overly restrictive and time consuming planning system continue to fuel Australia's affordability crisis,'' said HIA senior economist Ben Phillips.

3. British capital gains tax - It seems the Brits are getting very serious about turning around their budget deficit and their economy. The Telegraph reports that the emergency budget scheduled for June 22 is set to increase capital gains tax for some assets to as much as 50%. Now that's a real reforming Prime Minister.

The Chancellor is to increase duty on capital gains even though the plan was not included in the Conservatives’ election manifesto. CGT on “non-business assets”, including second homes, buy-to-let properties and shares, could rise from the current 18 per cent flat rate to a top rate of 40 or even 50 per cent, to fall in line with the higher rates of income tax. David Cameron has been warned that the decision to raise CGT would be particularly unwelcome for core Conservative supporters, who were unaware when they voted Tory that they would end up with a significant bill on their investments. Middle-class families have complained that they are effectively paying the price for the Lib Dem proposal to reduce income tax for low earners, which was adopted as part of the coalition agreement between the two parties.

4. Mere details... - It turns out the Euro mega-rescue 'shock and awe' uber-bailout isn't really a done deal. It turns out the Euro zone finance ministers are still sorting out the details, including a few wrinkles... This does not inspire confidence. Reuters has the report.

After talks in Brussels late on Monday, German Finance Minister Wolfgang Schaeuble and others played down what some officials described as Franco-German differences over the way the anti-contagion mechanism would be deployed. "It was more about technical things than differences," the German minister said on Tuesday, without elaborating. Jean-Claude Juncker, Luxembourg prime minister and chairman of the talks, also said outstanding issues were "technical" and that ministers hoped to resolve them on Friday when they would return to Brussels to discuss longer-term policy matters.

FTAlphaville also points out the holes in the ECB's plans to sterilise its bond buying. Gold anyone? (See below).

What liquidity the ECB takes away with one hand, via the term deposits, it gives in unlimited amounts with the other. Anyway, some analysts are (predictably) criticising the move — mostly on the grounds that it is largely symbolic, with little meaning so long as the ECB’s other liquidity ops are running at full speed.

5. 'Here it's yours now' - European banks are dumping as much of their toxic sovereign debt holdings onto the European Central Bank as fast as they can, Ambrose Evans Pritchard at The Telegraph points out.

Foreign holders of Greek and Portuguese debt have seized on emergency intervention by the European Central Bank to exit their positions, leaving eurozone taxpayers exposed to the credit risk. The Bank of New Mellon said its custodial data showed a "sharp acceleration" of net sales of debt from the two countries after the ECB began purchasing €16.5bn of bonds from southern Europe and Ireland in bid to halt market panic. "It rather suggests that investors leapt at the opportunity to clear their balance sheets of intolerable risk," said Neil Mellor, the bank’s currency strategist. "This leaves the ECB itself in an unpleasant situation since it now faces a deterioration in its own balance sheet." Crucially, there are still serious strains in the interbank lending market. Hans Redeker, currency chief at BNP Paribas, said the LIBOR-OIS spread in Europe used to gauge credit stress is flashing danger signals, hovering near levels seen during the Lehman crisis. The ECB’s strategy of draining liquidity to offset the stimulus from the bond purchases risks making matters worse. "They are using one-week deposits for sterilisation and the effects of this to make short-term funding more expensive. This will force banks to sell assets to shrink their balance sheet and risks causing a credit crunch," he said.

6. A real cash machine - AFP reports that the Emirates Palace Hotel in Abu Dhabi has installed a machine that dispenses gold. The machine is gold plated. Of course.

Abu Dhabi's Emirates Palace Hotel became the first place outside Germany to install "gold to go, the world's first gold vending machine," said a statement from Ex Oriente Lux AG, the German company behind the vending machine. "In addition to one-gram, five-gram and 10-gram bars of gold, the machine also dispenses gold coins," it added. Gold rates are constantly updated inside the shiny machine -- itself gold-plated -- in the hotel's lobby, courtesy of a built-in computer connected to a dealer which sells gold online.

7. Negative equity - This chart tells the story of why America has such a problem. So many homeowners are now in negative equity they have stopped borrowing against their houses to spend. It's all about de-leveraging. It will not go away and it can't be tricked, delayed, fooled, avoided or flipped. HT Calculated Risk. It will get everyone in the end, unless there is massive inflation... Click on the chart for a bigger more legible version. 70% of houses in Nevada are in negative equity.

8.  Just a bit wrong - US equity analysts have over-estimated earnings growth for the S&P 500 by a factor of 2 on average since the mid-1980s, Paul Kedrosky points out in this chart below. Hmmm. I wonder if they have handed their bonuses back in.

9.  Not what you'd think  - Ross Douthat at the New York Times points out that despite all the talk of revolution and change and the apparent rejection of authority power has actually been consolidated in the hands of the bankers and governments that caused the globe's financial problems.

This feels like a populist moment. Americans are Tea Partying. Greeks are rioting. Incumbents are being thrown out; the Federal Reserve is facing an audit; Goldman Sachs is facing prosecution. In Kentucky, Ron Paul’s son might be about to win a Republican Senate primary. But look through these anti-establishment theatrics to the deep structures of political and economic power, and suddenly the surge of populism feels like so much sound and fury, obscuring the real story of our time. From Washington to Athens, the economic crisis is producing consolidation rather than revolution, the entrenchment of authority rather than its diffusion, and the concentration of power in the hands of the same elite that presided over the disasters in the first place. This is the perverse logic of meritocracy. Once a system grows sufficiently complex, it doesn’t matter how badly our best and brightest foul things up. Every crisis increases their authority, because they seem to be the only ones who understand the system well enough to fix it. But their fixes tend to make the system even more complex and centralized, and more vulnerable to the next national-security surprise, the next natural disaster, the next economic crisis. Which is why, despite all the populist backlash and all the promises from Washington, this isn’t the end of the “too big to fail” era. It’s the beginning.

10. Totally irrelevant video - You might be Elvis. Why irrational beliefs are not very useful...HT @Holloway NZ via Twitter