Gfc

Now I have vacated the job of helping edit news.com.au, let me reveal my dreadful desire to write an almost unthinkable headline: “Rates hike means more gain for savers”.

It’s pretty well inconceivable that any major media outlet would lead with this sentiment for fear of alienating all the hard-pressed homeowners, the millions of working families and Aussie battlers feeling the pinch in the ever-tightening mortgage belt.

This holds true from the most rabid reactionary radio shock jock, through the marching minions of Murdochdom (I am yet to hand back the company-issued electric shock collar), to the fairy floss fops of Fairfax and even unto the ABC commissars of collectivist cant.

Continue reading "Come on RBA, get those rates up you good thing" »

According to the Australian Treasury the global financial crisis is now officially ‘over’, with business booming and the unemployment rate once again beginning to shrink.

From an economic perspective, we might breathe a tentative sigh of relief, bearing in mind the fact that these boom and bust cycles are a cyclical feature of the global economy.

However, a broader social crisis still remains in the form of the persistent and intergenerational disadvantage that is preventing a significant proportion of Australians from contributing to the three national challenges of ‘Productivity’, ‘Participation’ and ‘Population’ identified in this year’s Intergenerational Report.

Continue reading "The GFC might be over but the poverty crisis remains" »

The Rudd Government claims to be superior in economic management. How so?

The real reason Australia did better than most developed countries in the recent financial crisis was that the Coalition had by 2006 repaid the $96 billion debt run up by Labor, left a $5 billion Education fund, a $60 billion Future Fund and a $22 billion surplus!

Add to this a virtually strike free environment, whereby employment grew, wages grew and exports grew.

Continue reading "Who’s the real economic freak show?" »

As a child, my parents read to me the classic childhood tale of the boy who cried wolf, a tale that cautions against repeatedly claiming danger when there is none.

Last year, businesses throughout the world experienced danger associated with the global financial crisis.  The risk of a catastrophic collapse of confidence was very real and to the credit of the Australian Government, and other governments around the world, there was quick action to restore investor confidence.  The stimulus package might not have been perfect, nor was it always directed in the best way possible, but it did its job.

But if you have been listening to the banks of late, you might get the sense the crisis has not passed, that profitability is under grave threat and that interest rate margins are too low. I dispute this.

Continue reading "OK banks, you’ve had your fun with interest rates" »

This cannot be happening, I thought as I filled in Centrelink’s Newstart application form.

How could I have sunk this low?

I’m well educated, resourceful and have been a language teacher, conveyancer, legal secretary and newspaper journalist.

Continue reading "When the sea change hits a sand bar" »

Credit card bill hurt?  Rate hikes hitting the mortgage payments?  Tired of endless waits on hold or in your local branch?

Fret not.  It’s all for a cause. Not yours, of course.  Our big banks.  Why, they’re so grown up, it’s like bonus season on Wall Street.  Makes you proud to be an Aussie.
Sure, wage increases for bank workers hover around 1-2 per cent. Yes, 5000 jobs have been off-shored. True, dividends are down 20 per cent. But spare a thought for Cameron Clyne, CEO of NAB.  He only made $14,246 a day last year.  A pygmy among the seven or eight figure giants - if you don’t include smaller banks like ME.

Continue reading "Please, dig deep for our bank chief executives" »

It’s a little-known fact, but not long ago the Commonwealth Government hired some corporate management consultants to update our national anthem. The first verse became:

Australians all let us rejoice: National stakeholders going forward should be committed to visionary communications

For we are young and free: For we incubate next-generation scenarios that leverage dynamic functionalities

With golden soil and wealth for toil: With mission critical infrastructure to maximise world-class deliverables

Our home is girt by sea: Our brickware harnesses frictionless supply chain scenarios.

Continue reading "Global Frankness Crisis contributed to the GFC" »

There may be discussions that the financial crisis is over. This, I believe, is premature, because the fundamental aspects that create economic instability are still present.

Right from the outset it should be stated that a domestic stimulus package for the Australian economy, an economy which earns its money from the export of agriculture and minerals and which spins around the money by the provision of services, will not be assisted by personal expenditure in imported plasma screens and sound systems and the construction of school halls. The outcome of the stimulus expenditure does not proportionally increase the aggregate size of the economy. Any benefit is far outweighed by the extensive leverage to which our nation is exposed.

If we imagine the Australian economy as an Australian family household, the debt has brought new plasma screens, ceiling insulation and a new coloured phone but the house remains the same size, the same value and no one in the house is earning more money because of the expenditure.

Continue reading "How many plasma TVs does one country really need?" »

A couple of years ago I received a furious telephone call from the chief executive officer of one of our biggest companies complaining about what he regarded as the ungrateful and insulting tone of The Daily Telegraph’s coverage of executive salaries.

The bloke had a bit of a point because, as he pointed out, his salary was extravagant on paper but had coincided with an unprecedented period of increased returns to shareholders. He’d also resisted the slash-and-burn approach to running his business, shielding workers from dismissal when it would have been the easiest way to achieve short-term savings in what was then a looming economic downturn.

The point I tried to make in the media’s defence was that rather than accusing us of being cheap populists, he should really convene a telephone hook-up with his fellow CEOs and ask them if their remuneration fell into the same category as his.

Continue reading "Give shareholders the real power to cut bosses’ pay" »

Julia Gillard’s week got a lot better just before lunch time yesterday with the announcement the latest jobs figures had held steady.

The general consensus was the data saved her from the hammering she’s been getting in Question Time over the dodgy mess the administration of the Building the Education Revolution plan has turned out to be.

And yes our jobless figures look pretty flash compared with the rest of the world. But the Government shouldn’t be jumping up and down just yet - and to her credit Gillard resisted the urge.

Continue reading "As good news goes, the jobs figures were luke warm" »

MALCOLM Turnbull is wasting his breath, and opportunities to land some punches in question time, by attacking the Rudd Government’s commitment to maintaining its economic stimulus spending.

Put simply, there’s no political gain to be had by taking Turnbull’s advice - or being seen to be taking his advice - and turning off the stimulus tap.

The point is not about whether maintaining the current proposed level of spending is the right thing to do.

(Join The Punch team here at 2pm for live coverage of Question Time).

Continue reading "No political gain for Turnbull in attacking stimulus" »

What a lovely recession we’re having. Or not having.

This morning’s GDP numbers were supposed to reveal the recession was a close run thing, with only a handful of flat-screen TVs and school gyms keeping the economy going in the right direction.

But 0.6 per cent growth in one quarter would be pretty tidy in a normal year, let alone the year after the greatest global financial meltdown in generations.

Continue reading "What Recession?" »

Australia’s momentary brush with recession is over. After less than twelve months we are now leading the world out of what was meant to be the crash of the century.

For a year, we have scratched our heads at the demise of others, cowered from the collapse that never came and frolicked with hand-outs. Just as we all had our glasses out for another free drink, suddenly it’s time to clean up after the party, count the debt and pay it off.

The world’s economies move like a cycling pack; uneventful until someone takes a fall.

Continue reading "The Rudd-free account of how we dodged the downturn" »

Rome wasn’t built in a day, and the same adage can be applied to women’s equality in society. However, lately it feels like construction has come to a complete halt.

Research released this week by the Australia Institute positioned women as one of the groups hardest hit by the financial crisis in the workplace. While more men had lost full-time jobs than women, women faced worsening underemployment in the form of limited hours and poor pay.

The women hardest hit by this news will be those who can least afford it – struggling lone mothers and women from low-income backgrounds. 

Continue reading "Women are the real losers in the Global Financial Crisis" »

Gosh it’s hard to keep up. Kevin Rudd is responsible for us surviving the worst of the Global Financial Crisis, but not responsible for the massive government debt we’ve racked up in the battle.

The Rudd government is close enough to China to get the $50 billion Gorgon Gas deal through, but not close enough to get Stern Hu an appointment with a lawyer.

What’s next - John Howard was responsible for interest rates going up, but Kevin Rudd was only responsible for interest rates coming down? What about when they go back up again?

(The Punch team will be discussing this and other issues with Federal Minister Anthony Albanese on Punch TV at 12.30pm today on Sky News).

Continue reading "After taking credit for good news, who’s to blame for bad" »

Oh the horror. If I could have slapped myself across the chops without it hurting, I would. Lord knows I deserved to.

Instead, I slammed the wardrobe doors in disgust, sat down on the bed littered with shoes, dresses, bags, belts and other crap I don’t need, and had a long, hard think about where it all went wrong – how I had found myself in a global economic crisis with what could have been a year off my mortgage in bits of fabric and leather tat.

I had not always been a label queen, nor had I ever aspired to be. As a young cadet journalist on newspapers, designer clothes were never a consideration or a possibility – not if I wanted to actually eat regularly.

Continue reading "More money than sense: go broke on fashion in the GFC" »

With a growing feeling that the worst of the global financial crisis may be behind us, it’s a good time to have a look at the competition landscape in our banking sector.

Sadly for consumers it not a pretty sight as in just under 2 years we have seen the 4 major banks dramatically and significantly increase their dominance in the sector to the detriment of consumers.

The Commonwealth Bank and Westpac, in particular, have shot in front of the NAB and ANZ to leave them and the smaller regional banks well and truly behind in the race to dominate Australia’s banking sector. Is the increased dominance of the Commonwealth Bank and Westpac something to be pleased about?

Continue reading "The GFC killed competition to the big four banks" »

Last Friday I continued a tradition of my predecessor in Cook, Bruce Baird, by catching up with one of our more prominent Shire constituents at Tatterstalls Club in Sydney.

The occasion was a public hearing of the House of Representatives Standing Committee on Economics, which Bruce used to chair. The constituent was none other than Reserve Bank Governor Glenn Stevens. The Shire conspiracy over economic management in Australia continues!

As usual, reports of the proceedings narrowed in on the key question of where rates are headed. Sadly, the answer is up,  by as much as 2%. This was not a major revelation as the Governor had already flagged this view in the Bank’s August monetary policy statement.

Continue reading "When rates go up again, who will Rudd blame then?" »

Kohlberg Kravis Roberts, Texas Pacific, Blackstone, CVC, Carlyle, Pacific Equity Partners, Apollo.

Until two years ago, these fearsome private equity predators stalked the planet, preying on the weak and growing fat. National icons trembled before them.

In Australia, they devoured Myer, Bonds, Harvey World Travel, Repco, Cleanaway, the Nine Network and half of Seven. They almost got Coles and, most spectacularly, Qantas. Overseas, household names such as Chrysler, Reader’s Digest, Burger King, Toys-R-Us, Tommy Hilfiger and Madame Tussauds fell to the private equity money men. (Some have since escaped.)

Continue reading "Beware, the barbarians are back at the gate" »

A SIMPLE message scrawled on scrounged cardboard used to be enough. Basic signs like “Hungry, please help” or “homeless – need $$$’’ would help eke out a living.

But in these tough financial times, scroungers are ditching generic pleas and getting creative to maintain their cash-flow.

Faced with stiff competition – including an army of charity muggers, talentless buskers and ambush windscreen washers—society’s have-nots are polishing sales pitches.

Continue reading "Beggars choosing creativity to beat the GFC" »

Have you ever thought that you were being taken for a ride on petrol prices? Well, you have!

So how are you being ripped off? It’s simple really – once, of course, you know the games that can be played by the big oil companies and Coles and Woolworths.

Let’s begin at the retail level.

Continue reading "Coles or Woolworths you get screwed either way on petrol" »

The Israeli political system is far from stable.  Robustly democratic sure. 

But since the advent of proportional voting for the Israeli Parliament - the Knesset - it has seen a revolving door of governments between Labor, the Likud and now Kadima, all having to govern in coalition with minor parties. 

Some would say that Israeli politicians and the Israeli public would wish for the stability that our voting system has delivered for a hundred years – but would they?
This may well be a case of ‘be careful what you wish for’. 
Because of the instability of the votes in the Knesset the government of Ehud Olmert failed to have their Budget passed by the Parliament for 2008-09. 

Continue reading "We’d be better off in Israel - they don’t need stimulus" »

Hot news. I’ve just received a press release from the PGA of Australia which says that golf participation rates increased by a whopping 27 per cent in 2008.

And the reason we’re all flocking to the first tee in unprecedented numbers? Well, apparently it’s because we’re unemployed and have nothing better to do.

Seriously. Here, word for word, is the PGA of Australia CEO Max Garske’s breathtaking spin on the sudden surge.

“Typically the biggest concern for golfers is not finding enough time to play a few holes on a regular basis. But the current economic situation has created more leisure time for many Australians.”

Continue reading "Unemployed? Time to brush up on your putting skills" »

Last week we held a public event we call Sydney Conversations – a series of talks we host where, with the aid of a panel of speakers, we get to look closely at a topic that’s making the news, and get the news behind the news, so to speak. 

Our Conversation was around the topic ‘How much is enough?’. The idea was to look at the link between money and happiness, or money and unhappiness as the case may be. 

The Happiness Institute’s Tim Sharp talked about the sources of happiness: he said that having meaningful and purposeful pursuits is the path to happiness, coupled with the quality relationships we have in our lives. That happiness had nothing whatsoever to do with money.

Continue reading "Finding happiness in the middle of a crisis" »

Is the GFC turning out to be as good for you as it is for me?

Save for any poor souls who invested with a bloke named Bernie or used to turn up for work at Macquarie every day, the GFC is a gift horse we are looking plum in the mouth.

For one thing, the GFC, with one elegant swoop, does away with the pretense of sociability or politeness or even basic hygiene.

The GFC has undone years, decades, of social mores and replaced it with a brave new world, one where we now have the perfect cover to embrace that indolent, indulgent, trackpants-clad life we have always yearned for.

Continue reading "GFC is coming up roses for us non-material girls" »

It took me a while to realise it because usually, people who enter politics have some smarts and go in wanting to do what they believe is the right thing. They pursue policies they believe will make our country an even better place.

That is why I have been at a loss to understand how a group of people who promised us in the lead up to the last election that they were “economic conservatives” who “believed in surpluses” could turn a low unemployment surplus economy into one with rising job losses, record spending and historic debt levels.

Then it hit me – it is not that Labor can’t manage money – it is that they actually don’t want us to get ahead and have our own money.

Continue reading "Kevin Rudd doesn’t want you to have your own money" »

YOU could hear hearts breaking across NSW yesterday at the terrible news our impoverished politicians will be forced to subsist on a meagre $77.55 a day meal allowance.

Not since federal Labor MP John Murphy went public about the paltry beef stroganoff servings at the parliamentary canteen has the public seen the true impact of hunger on our elected representatives.

Turn it up. At a time when so many households are going without, the application by our pollies to the remuneration tribunal for a bit more pampering has understandably enraged put-upon families.

If these MPs are battling to make ends meet, there’s a raft of innovative money-saving ideas out there in cyberspace which I’ll discuss for their benefit, after recapping this latest perk grab.

Continue reading "Battling bloggers’ handy hints for our poor starving MPs" »

What a relief. The poster boy of the Global Financial Crisis Bernard Madoff, 71, will never see the outside of a jail after the United States District Court handed him a 150 year sentence for orchestrating his “evil” $US65 billion ponzi scheme .

When you’re as old as Bernie any sentence more than 25 years may as well be 1000 years, but the judge in this case Denni Chin obviously decided enough was enough.

And if Madoff had have been caught three years ago - before the mirage built by the burghers of Wall Street evaporated and revealed to us the GFC, he might have ended up one of those corporate crims who do their time and are out again to enjoy their yachts before they die.

Continue reading "Sucked-in Bernie Madoff: your timing was terrible" »

So we know the GFC is here. Many of us have lost our jobs, we’re all watching our superannuation shrink faster than we can top it up, and all of a sudden bling is out and understated is the new black.

But what does a nearly recession actually look like? The Team at the Punch has come up with our list of the 50 ways the Global Financial Crisis (it’s officially capped, you know), has changed Australia.

Some of them have hard numbers to back them up – others are a sniff of the wind, observations about changes in language and society. We welcome your suggestions.

1. We’re cooking at home. Woolworths has noticed a bump in sales of cooking staples such as eggs and butter, as well as increased demand for value cuts of meat (we’re making casseroles), and for cheaper Home Brand products.

Continue reading "Fifty ways the GFC has changed Australia" »

In early 2008 it seemed that the Australian economy could do no wrong.

Unemployment hit a low of 3.9% in February, GDP growth was strong and the prices of our exports were growing at unprecedented rates. Profits were up and consumers were spending.

The only dark cloud on the horizon was the increasingly poor performance of the US economy, which had gone into recession in November 2007, and some faraway problems in overseas banks and credit markets.

Our share market had hit a few minor hurdles after peaking in November 2007, but was still close to record highs after four years of double digit growth.

Continue reading "The GFC: How we got into this terrible mess" »

As a member of ‘Generation Y’ I’ve come to grips with the various stereotypes and countless sledges that come our way.

Everyone loves to bag us. John Birmingham was even quoted to be “looking forward to seeing them get run over by the coming recession”.

So to any haters I have some bad news: the recession has had little negative impact on Generation Y at all.

In the immortal words of John Lennon, “Nothing’s gonna change my world”.

Continue reading "What GFC? We’re Gen Y and we’re recession-proof" »

I’m a slave to fashion, I admit. Working in the industry has let me indulge my unhealthy obsession up till now, but because of the GFC, I, like most other women, have had the incredibly boring task of cutting back.

Cue recession dressing. Or if you want to get technical, dressing like a Recessionista (noun: a resourceful woman who’s great at updating her look while spending a minimal amount of money).

There are many ways to do this. Inventive and fun ways. Cheap ways. Exciting ways. The best ways for most women of course, involve spending money on stuff we don’t need so we can justify it by saying we’re actually saving money in the long run. “Sure, they were $300, but I’m going to wear them 50 times, so that’s only $6 per wear. Cheaper than the op shop.”

But my new fave has to be that women, out of sheer necessity and financial conundrum, have created an entirely different category of clothing to add to our fashion arsenal: Leggings.

Continue reading "Recession dressing: who needs pants anyway?" »

YOU’D expect the World Bank to employ some pretty top-notch economists. The body and its 10,000 staff - including a fair smattering of economists - are charged with spending tens of billions of dollars donated by member countries to lift the developing world out of poverty.

And to do that effectively, I suspect, you would need to have a pretty good grasp on what the world economy is actually doing.

In reality, however, the bank doesn’t seem to have a clue. Earlier this week the World Bank ``revised’’ its forecast for global GDP this year from a fall of 1.7 per cent to a fall of 2.9 per cent. With global economy worth roughly $85 trillion, that’s a $1 trillion ``revision’‘. It’s the equivalent of forgetting to include Australia - the world’s 14th biggest economy.

Continue reading "Economists are full of it and the IMF doesn’t have a clue" »

“We face a fight for survival.”
British Airways chief executive Willie Walsh last week.

“(Qantas) faces many obstacles in surviving.”
Qantas chief executive Geoff Dixon in July 2003.

For an industry that depends on its ability to instill confidence in travelers, airlines sure spend a lot of time scaring their workers and shareholders witless.

Continue reading "Airlines are a mug’s game" »

Whilst Australia’s economy is facing enormous challenges arising from the impact of the global recession, there is another story emerging.

It’s a story of consumer spending holding up, of the housing market remaining strong, and of companies sharing around the burden by shortening hours to keep employees in jobs.

We are not out of the woods yet, but in the short-term the savage downturn that’s hit many other countries so hard, has been averted here in Australia.  I believe this has happened because the Government has displayed two important strengths in a time of crisis: political courage and long-term vision. 

Continue reading "We have the chance right now to build a better nation" »

LEWIE Ranieri was one of the stars of Liar’s Poker, Michael Lewis’s fantastic expose of excess on Wall Street and in London in the 1980s.

At his best, the Salomon Bros trader, who pioneered the kind of mortgage-backed bonds that brought the financial system to its knees last year, was taking home somewhere between $US2m and $US5m a year. He famously owned more powerboats (five) than suits (four). He was, in the vernacular of the times, a big swinging dick. A master of the universe. A Gordon Gekko before Oliver Stone and Michael Douglas brought the fabulous rogue to life.

You didn’t get much more colourful or successful than Ranieri (who, incidentally, is still mooching around Wall Street as a fund manager). But, for anyone with more than a passing interest in matters financial, his salary, so celebrated at the time, now looks absurdly small. Telstra’s David Thodey, who’s running a regulated utility at the bottom of the planet and drives a Toyota Corolla, will earn more most years.

Continue reading "How did we end up with all these zeroes?" »

The late Lee Atwater is a legend in the US Republican Party. Hailing from South Carolina he successfully rewrote the book on American election campaigning. Atwater ran scare campaigns and he was good at it. He made a name for himself in the early 1980’s with his aggressive campaign tactics including push polling and dog whistling on racial issues in the South.

Atwater won election after election running scare campaigns on any issue he could find. He ran scare campaigns on religion; he ran scare campaigns on race; he once even ran a scare campaign claiming his opponent was unfit for office because he had suffered from depression as a teenager.

Lee Atwater understood people and, more importantly, he understood the power of emotion over rational thought. He used to say that people vote their fears over their hopes and that fact shaped his campaigning.

Continue reading "Frightening the life out of voters over debt" »

LIKE darning socks, car-pooling and drinking instant coffee, bank bashing went out of favour when we were all getting rich during “the great neo-liberal experiment”. Now, from the top office in the land down, this wholesome pursuit is making a comeback.

It’s not that the banks ever lost their talent for bastardry. It’s just that for a decade or so it has been suppressed by competition – from the likes of Aussie and Wizard – and by the buoyant economy. That $140 annual account-keeping fee didn’t look so bad when your credit card was in the black and the value of your house had doubled in the past two years. But with competition to the Big Four now all but wiped out, leaving the Westpac, Commonwealth, NAB and ANZ as the last saviours of our financial system (just ask them), the bastards inside can once again be unleashed. 

The Commonwealth took one for the team this week when it raised variable home loan rates 0.1 percentage points to 5.74 per cent. It was the first mortgage rate increase by the banks since last year but won’t, unfortunately, be the last.

Continue reading "Bastard banks making a comeback after the boom" »

Most Australians believe the global financial crisis is just another horror movie that will scare the bejesus out of us for a little while before the hero emerges covered in blood and the credits start to roll.

That’s the only conclusion you can draw from the latest Essential Report that finds more people think Australia’s economic conditions will get better rather than deteriorate over the next 12 months.

GFC fear reached its high point in February, when 65 per cent of people expected conditions to get worse, compared to 19 per cent expecting it to get better; now its as if the battle is over and Kevin 07 has slayed the beast. Following last week’s news that Australia had avoided technical recession, 43 per cent of people now believe the economy is on the up and up, compared to 37 per cent who see harder times to come.

Continue reading "Where is the Global Financial Crisis monster hiding?" »

If you’re searching for your first home you’d better find one this week, and you’d better have a healthy deposit, and you’d better hope your job’s secure, and you’d better pick the right suburb and don’t think about relying on the economic downturn to help you out.

No pressure but the Commonwealth Bank and BIS Shrapnel have in the past couple of days butted into the dreams of thousands of Australians and promptly turned them into a nightmare.

Contrary to all dining table predictions BIS Shrapnel today said house prices will go up 20 per cent over the next three years. This as CBA raised its fixed rate, after last week being the first to break ranks and lift its variable rate. Expect the rest of the banks to follow at a respectable distance, as soon as Wayne Swan stops holding press conferences to talk about team work and heavy lifting.

So prices are going up, rates are going up – and you can’t even get the friendly guy from the bank to take your call. And guess what, it’s your fault.

Continue reading "First home dream turns into a nightmare" »

“Hi … uhh…. So you know times are tough for me right now…. (awkward pause) … well, I’m a couple of weeks behind on rent… I swear I’ll pay you back…”

Have you ever asked a friend for money? It’s an awkward conversation that community radio stations have with their listeners every year during their annual supporter drive.

The only problem is that when a global financial crisis hits, posing the question this time around seems to border on the absurd.

Continue reading "Can Richard Branson save a battling Aussie radio station?" »

For most of this century, it’s been very hard to love Macquarie Group, as the bank is now known.

It should be held up as a great Australian success story - a home-grown investment bank that has followed only a handful of local companies in creating a truly global business. Think Westfield (shopping malls), BHP (rocks and oil), Foster’s (beer and wine), CSL (blood and plasma) and News Corporation (fine company, generous employer).

It built a business model - buying, owning and milking infrastructure assets - that, at least until very recently, was being emulated around the world.

Continue reading "Come back Macquarie Bank, all is forgiven" »

The debate the government deficit reminds me of the slogan that The Sheep from Animal Farm chanted in support of The Pigs: “Four legs good, Two legs bad”. Anything The Pigs did was OK, because they were Animals, and therefore good. Anything Humans did was not, because they walked on two legs and were therefore bad.

Ditto the debate over the debt levels being accumulated by the Federal Government in response to the Global Financial Crisis: it seems that Government debt is “two legged”, while private debt incurred is “four legged”.

Continue reading "Private debt is the muddy pig in the farmyard" »

What if the dire prognostications of the RBA, the IMF, the ABC, DOFA and other be-acronymed institutions were simply ignored?  What if people tuned out from depressing financial static and peddlers of economic voyeurism?

As the recent GDP figures showed, Australians are stubbornly refusing to lie down and pull the covers over their heads as the various hyperbolic chief economists that plague our media keep predicting they will.  Maybe it’s the Rudd Government’s stimulus that is keeping things going.  Whatever the reason, retailers are still retailing, baristas are still baristing, bookies are still fielding, hookers are still hooking and travel agents are writing tickets to Bali faster than they can manage.

Maybe it’s the Prime Minister’s war-cry of “keep spending” that’s keeping nannies, baby-sitters, house-cleaners, and lawn-mowers busy.  Or maybe it’s the indomitable and irreverent free spirit of Australians and the small business entrepreneurs who serve them.  Whatever the reason, the real economy is shrugging its shoulders at the broadsheets and ordering another beer.

Continue reading "What if they gave a recession and nobody came?" »

While everyone knows about the current financial crisis, few people know of Australia’s other crisis.

That other crisis involves the growing over-concentration of key markets in the economy and how our competition laws are impotent to deal with the growing crisis.

That crisis is already having a major negative impact on consumers and the economy through such things as higher food prices and higher bank fees.

Sadly, if this is not properly handled the negative impact will continue long after the current financial crisis is a distant memory.

So, what lies at the heart of this other crisis? To understand that, it’s important to go back to basics.

Continue reading "The real crisis isn’t the GFC, it’s lack of competition" »

I suspect there was a garbage bin full of “Rudd Recession” posters and TV Ads in Malcolm Turnbull’s office last week. Crosby Texter must have been furious. They were gearing up for the mother of all scare campaigns. Instead they are left with a second rate scare campaign on debt.

This is how it goes … 18 months ago there was no debt.  Now debt is out of control. It’s $300 billion!  Be afraid!  Blame Labor! Of course 18 months ago there was no global recession.  But don’t expect Malcolm to tell you that.  Or how much he would spend.  That would destroy the scare campaign. 

Why?  Because Malcolm would borrow almost exactly the same amount - $275 billion. That’s what makes this scare campaign more like Scary Movie than Wolf Creek.

Continue reading "Punch: Malcolm Turnbull is not that scary" »

You may remember that great carpet ad with the late Pro Hart, where together with his dog Rembrandt, he totally trashes a rug with pasta, red wine, chocolate sauce and cake. He splashes it about, rolls around in it, and even fires a shot gun at it.  The cleaner then walks in and famously says, in that great accent, Oh Mr Hart, what a mess!

The only difference I can see between the Rudd Government’s approach to fiscal policy and Pro Hart’s carpet antics, is at least Pro Hart produced a work of art (of sorts).

For the past eighteen months, Kevin and Wayne have been splashing around cash and rolling around on the carpet in others people’s money, like there is no tomorrow. They’ve taken a shot gun to the surplus, like Pro did with the cake, and splattered it all over the room.

Continue reading "Counterpunch: a Budget mess of Pro Hart proportions" »

September 2008: Malcolm Farr writes in The Daily Telegraph that Kevin Rudd is considering taking on net debt for the first time in 12 years. Government goes ballistic in its denials. Newspoll shows ALP 55% - Coalition 45%

October 2008: Rudd announces the first stimulus package and says the cash will be distributed by Christmas. Punters are comfortable with the $10 billion bottom line. Newspoll shows ALP 54% - Coalition 46%.

November 2009: Rudd spills the worst-kept secret in Government - that the Budget will go into “temporary deficit”. Newspoll two weeks later shows ALP 59% - Coalition 41%.

December 2008: Harvey Norman reports bumper Christmas sales, up 9 per cent on previous year. Kevin Rudd Santa Clause jokes start. Newspoll shows ALP 59% - Coalition 41%....

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