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Rise in Australians in Financial Trouble

May 15, 2012

 

The following is an extract from an article by Robert Gottliebsen at the Business Spectator

The world banking system is about to be tested once again by another European crisis because politicians and central bankers underestimated the power of people.

And here in Australia we have a version of the ‘Greek game’ being played under the surface.

In Europe whether they be Greek, French or Spanish, twenty first century Europeans will only suffer German imposed austerity for a limited period. The Greek crisis will be the trigger for the euro to be used by fewer countries.

Bankers will suffer big losses because they underestimated people power and did not understand that in long term you can’t have a common currency operating in vastly different economies.

The Greek crisis gains the headlines but deep down there is a global consumer nervousness sweeping the western world. Australian consumers are as nervous about the future as those in Europe or the US.

Among the major developed countries around half of consumers feel they are in financial trouble or not financially secure.

Fascinatingly, Chinese consumers feel the most secure. The graph above shows the emerging trend.

Australians, along with Germans, share the ‘honour’ of having the biggest rise in the number of consumers who feel they are in financial trouble or not financially secure.

In Australia the number rose a whopping 11 per cent from 36 to 47 per cent.

This lack of job security is causing a dramatic change in Australian spending habits and I think the change is going to be with us for the medium term so businesses better get used to it.

For example the percentage of Australian consumers saying they will spend less on discretionary items in the next year increased from 47 per cent in 2011 to 50 per cent in 2012.

This is higher than in the US (46 per cent), the UK (47 per cent) and about level of the average of the major European economies surveyed.

In other words Australians are saving.

But they are also changing the way they are spending and are increasingly seeking and expecting special offers. They are using the internet to compare prices and are increasingly shopping overseas.

 

 

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140 Comments leave one →
  1. JAWS permalink
    May 15, 2012 12:05 pm

    Some of the financial insecurity might be due to the turmoil overseas but the economic criminals Gillard and Swan are also responsible.

    Simply put people are sick of paying higher and higher taxes whilst the cost of living rises (although deflated by imported deflation in electronics/whitegoods and clothing).

    e.g. Last year these crims introduced the Flood Levy. This year they gave all of that plus more away.

    So much for the “we don’t have the money to repair Queensland line”

  2. JAWS permalink
    May 15, 2012 12:09 pm

    Also Commentators (the Hate Media) are basically unanimous in saying Swan has no hope of achieving a surplus in 2012/13. But he says he will do whatever he has to to make sure he does.

    Based on his track record that means just one thing.

    More taxes

    That’s why people feel insecure. They have absolutely no certainty and therefore no confidence to spend.

  3. Tom of Melbourne permalink
    May 15, 2012 12:25 pm

    Putting more tax on superannuation does not build confidence.

  4. JAWS permalink
    May 15, 2012 12:34 pm

    Since 2007 the entire government has been tainted with broken promise after broken promise.

    Or should we just call it “fine tuning”.

    If you “fine tune” too much people will just “tune out”

    http://www.theaustralian.com.au/news/nation/superannuation-cut-just-fine-tuning-kevin-rudd/story-e6frg6nf-1225827291629

  5. May 15, 2012 3:01 pm

    This means less people will have money to spend at Harvey Norman.

    There is a good side to every story. 😉

  6. el gordo permalink
    May 15, 2012 3:56 pm

    ‘Fascinatingly, Chinese consumers feel the most secure.’

    The Chinese are merchants and the Party is securing the people’s future by developing new markets around the world.

    This is unstoppable and food security through Africa and Australia is a major goal. There is one other thing happening, infrastructure development, which should help pull us out of deflation.

    In NSW the O’Farrell government is separating city from country rail and in my fevered imagination there is a strong possibility country rail will be placed on the open market for a quick sale.

    Me thinks China will put up their hand and begin to build the VFT line….projecting is an exciting pass time.

  7. May 15, 2012 3:59 pm

    Ssssshhhhhhhhh!

    Commies are eeeeevil!

  8. el gordo permalink
    May 15, 2012 4:05 pm

    Mops and buckets at the ready, they are our biggest trading partners and largest inflow of immigrants come from China.

  9. Splatterbottom permalink
    May 15, 2012 4:17 pm

    I like Chinese.

  10. Bacchus permalink
    May 15, 2012 5:01 pm

    They come from a long way overseas 🙂

  11. JAWS permalink
    May 15, 2012 5:41 pm

    LOL

    I wonder if the SMH put these 2 article up side by side on purpose today.

    2 bank error articles in one day

    One article deals with money given away in error the other deals with money given away on purpose.

    http://www.smh.com.au/business/10-million-westpac-blunder-exgirlfriend-denies-knowledge-of-bank-error-20120515-1yo5d.html

    http://www.smh.com.au/business/the-bank-lost-2-billion-the-boss-walks-off-with-32m-20120515-1ynwx.html

  12. JAWS permalink
    May 15, 2012 5:55 pm

    Plus I think it highlights the need to completely separate so called “Investment” Divisions from the “Retail” sectors and just cut these guys loose if things go pear shaped for them.

    Governments should never have to bail out these risk takers or their shareholders. As opposed to ordinary depositors who wish the other side of their deposit to be secured over residential or commercial real estate.

    If you want to invest in Macquarie Bank and they go down the plug hole so be it. That’s your problem.

    If you want to put your money in a Savings and Loan institution with real estate as the main security on the lending side then yes I think the government can provide a guarantee

    Sure RE is subject to valuation fluctuations. But its also not something some smartarse decided to call a “Deritative” because if they had called it “Insurance” (as that’s what it is) it would have been subjected to a legal framework governing insurance and calling it a Derivative skirted around that pesky problem.

  13. May 15, 2012 6:08 pm

    They’re always friendly and eager to please..

  14. TB Queensland permalink
    May 15, 2012 6:10 pm

    They don’t have accountants in China … all cheats are shot and the bill for the bullet sent to their families … 😉

    The good news for the barrackers is that Thomson would have have been long gone by now too … 😛

    I reckon the mix of a one party democracy and capitalism might work … * 🙄

    * more to come …

  15. May 15, 2012 6:11 pm

    “RE is subject to valuation fluctuations. But its also not something some smartarse decided to call a “Deritative” because if they had called it “Insurance” (as that’s what it is) it would have been subjected to a legal framework governing insurance and calling it a Derivative skirted around that pesky problem.”

    *eyes glazing over*

  16. May 15, 2012 6:14 pm

    TB, if Thomson was in China, he would have just quietly “disappeared from the streets” and no one, including the media, would’ve asked any questions…

  17. Bacchus permalink
    May 15, 2012 6:18 pm

    Simply put people are sick of paying higher and higher taxes

    Hmm – something didn’t sound quite right here – is this just RWDB rhetotic I thought 🙄

    In 2006, I paid 25.94% of my taxable income in tax. After 18.4% rise since then,
    in 2011, I paid 23.46% of my taxable income in tax.

  18. May 15, 2012 6:24 pm

    Well Bacchus, as my power bills skyrocketed by some 20-30% in the last year alone, I’m apparently, supposed to be grateful for some $0.06 cents a week in compensation from the government.

    Gee thanks Julia…

    🙄

  19. el gordo permalink
    May 15, 2012 6:27 pm

    * more to come …’

  20. May 15, 2012 6:27 pm

    I’m spending my $3 on a block of wax.

  21. TB Queensland permalink
    May 15, 2012 6:33 pm

    Maybe (it is 2012 :roll:) but had a Chineses citizen disrupted the central Committee to the extent that Craig Thompson had … the Chinese Government would have to make an example of him …

    Craig Thompson and his ilk on both sides of politics are the result of soft parenting encouraged by the “treat ’em nice and don’t chastise them brigade” – you know the one’s – always winners never losers … everyone gets a prize … and this is what we end up with …

    The Chinese get a lot wrong with “human rights” but so does Western “civiliization” … my family have already had discussions on the next world confrontation … Islam and China … and the were asked to make a choice (if it ever came to that*)… China took the vote … three generations … what folk forget is that if you do the right thing by your neighbours and yourself .. the Chineses government is no different to our own …

    * they also said that guerilla warfare was their preferred option if we wer ever invaded … I’m sure Toillette would agree!)

    +++++++++++++++++++++++++++++++++++++++++++++++++++++++

    Simply put people are sick of paying higher and higher taxes

    … and didn’t the threshold just increase to allow 1,000,000 that’s one million people to work and not have to pay any income tax after July 1 … or did I get that wrong … do I need a shonky financial advisor or a shonky accountant for advise?

  22. TB Queensland permalink
    May 15, 2012 6:35 pm

    Well Bacchus, as my power bills skyrocketed by some 20-30% in the last year alone, I’m apparently, supposed to be grateful for some $0.06 cents a week in compensation from the government.

    … and that;s before the sky falls in the Carbon Tax!

  23. May 15, 2012 6:39 pm

    Here in SA we’re getting clobbered by ridiculous increases in electricity cost and water bills, so that the metro-scum in Adelaide can have a desal farce plant.

    It shits me, and I’m thankfully currently in a position to be able to deal with it. I often wonder how difficult it must be for those not on a generous income.

    One thing I know for sure. If Abbott gets the reins, he won’t make a speck of difference insofar as those utilities going down instead of up. The rot has set in & both the majors are a symptom of the disease.

  24. el gordo permalink
    May 15, 2012 6:43 pm

    ‘guerilla warfare was their preferred option if we were ever invaded …’

    The safari suits will make you stick out like a sore thumb.

  25. el gordo permalink
    May 15, 2012 6:53 pm

    ‘…he won’t make a speck of difference insofar as those utilities going down instead of up.’

    Not sure about that, but getting rid of that odious tax should free up a lot of money to invest in new coal fired energy infrastructure. The Australian people don’t want to pay for useless green infrastructure which can’t carry base load and requires endless subsidy.

    The Chinese are on standby to do for us what they are doing in the US.

  26. May 15, 2012 7:05 pm

    “Not sure about that”

    I am 100% sure.

    You would be too if Abbott didn’t represent some kind of middle finger to AGW for you.

    He’s a stooge, just like they are all stooges. He’s not the antidote, he’s another part of the infection.

  27. May 15, 2012 7:11 pm

    Here in SA we’re getting clobbered by ridiculous increases in electricity cost

    People in SA are screwed with their electricity costs. How can they pay 3 times more over there than we do here in the ACT?

  28. TB Queensland permalink
    May 15, 2012 7:12 pm

    The safari suits will make you stick out like a sore thumb.

    … much better camouflage than eggshell, egg …

    He’s a stooge, just like they are all stooges. He’s not the antidote, he’s another part of the infection.

    eggsactly!

  29. TB Queensland permalink
    May 15, 2012 7:13 pm

    How can they pay 3 times more over there than we do here in the ACT?

    FMD, Miggsy, you need to ask? I thought your were a senior PS! 🙄

  30. May 15, 2012 7:20 pm

    If I had to guess, I’d blame the raping on residual legacy of Rann. Problem is, the other lot are just as bad & will never revoke the damage.

    Seriously, utility bills are getting fkn stupid here. I really don’t know how lower income earners can be coping.

  31. May 15, 2012 7:29 pm

    Tboss, electricity prices skyrocketed in SA when John Olsen sold off ETSA to the Chinese.

    You were just a lad then.

  32. May 15, 2012 7:37 pm

    You’re right, miglo. I remember.

    I was young, but paying my first electricity bills while at uni then, when the libcuntz privatised it.
    Such things play into the hands of business & government, not the average rate payer…hance the perpetuation of it under Labor & Liberal governments here.

    Personally, I think power & water should be owned by the taxpayer. They can stick their free market up their arse when it comes to the fundamentals.

  33. May 15, 2012 7:39 pm

    Rann pulled the trigger on desal & other metrocentric rapifying though. He initiated the forward selling of forestry assets in the South East too. Now they’ve replaced him & hope we forget.

    Noone down here will forget for the next century.

  34. James of North Melbourne permalink
    May 15, 2012 7:45 pm

    Every year our use goes down and our bills still skyrocket. Have initiated every power saving thing we can and still our bills have doubled. And yes, we’re subjected to a fkn desal plant here too.

  35. May 15, 2012 7:55 pm

    Same here, snacty, same here.

    It’s enough to make a man despair (briefly, before the rage sets in).

  36. el gordo permalink
    May 15, 2012 7:58 pm

    ‘He’s a stooge, just like they are all stooges. He’s not the antidote, he’s another part of the infection.’

    Abbott listens to the people and Julia doesn’t, but I generally agree that politicians are pathetic.

  37. Tom of Melbourne permalink
    May 15, 2012 7:58 pm

    I don’t look at any bills. I only deal with household revenue.

  38. TB Queensland permalink
    May 15, 2012 8:01 pm

    Abbott listens to the people That’s why he believes in gay marriage …

  39. Tom of Melbourne permalink
    May 15, 2012 8:04 pm

    Have a look at Uluwatu on ch 2

  40. May 15, 2012 8:10 pm

    Uluwatu is BOSS !

  41. Tom of Melbourne permalink
    May 15, 2012 8:10 pm

    Well I think it’s pleasant there anyway.

  42. May 15, 2012 8:11 pm

    Abbott listens to noone. His nose is to the political breeze…that is all.

  43. Tom of Melbourne permalink
    May 15, 2012 8:11 pm

    Uluwatu is great, Kuta is like Rosebud or a downmarket Coffs Harbour.

  44. May 15, 2012 8:13 pm

    I have fond memories of Kedaton Monkley Forest…(beware of rabies). 😯

  45. May 15, 2012 8:14 pm

    Kuta is for contiki tour ockertard deadshitz.

  46. May 15, 2012 8:14 pm

    Kamu rogol mayat harimau galak.

  47. el gordo permalink
    May 15, 2012 8:15 pm

    Apart from gay marriage (a matter of conscience) Abbott wants to do popular things and stay in power.

    The increase in electricity costs comes from running out poles and wires, the network, which is done by monopolies who tend to overspend and make us pay.

    ‘Typically, network costs make up between 40 to 50 per cent of a power bill, while wholesale costs make up about 40 per cent.’

    The wholesale price has fallen because of individuals like James, who do what they can to reduce their footprint, but are still paying top dollar.

    So there is potential to reduce power bills quite quickly if we have a mind to do it.

  48. May 15, 2012 8:29 pm

    Ken Henry gave a glowing and I mean glowing endoresment of Rudd on 730 Report tonight.

    Then we had a story on La Trobe Valley Coal and there is still 430B tonnes of it yet to be mined. Yes I’ll repeat that ………………..430 BILLION tonnes.

    So now Victoria is thinking of exporting it since the power stations will be closed down. By the way the power stations apparently consume 31MT per year.

    Christine Milne’s response was…………….and I quote………………….”thats not fair”

    After pissing myself laughing at her response (and thinking I hope a rabid black crow picks out her eyes one day) I then switched to Skynews

    Peter Van O (or whatever it is and I know he is of the Libs) said the tragedy for Labor is that the 3 % up in the poll numbers cements her leadership for a while. So Labor will be stuck with her for even longer yet time for them is running out.

  49. May 15, 2012 8:33 pm

    LOok at your power bills

    Your prices are going up largely due to stupid renewable schemes and the feed in tariffs that come with them. If you voted Left you havelargely lost your right to complain about what you now have insofar as power prices were concerned.

    You made your bed……………..sleep soundly

  50. May 15, 2012 8:34 pm

    What ‘we’ have a mind for equates to naught, because the lawmakers will act in their own interests at our expense 9 times out of 10.

    The rot is unstoppable.

  51. May 15, 2012 8:37 pm

    I didn’t vote for what we have.

    And, as I said, I can handle the burden currently…but I sympathise with those on less than generous incomes. The government(s) will never give out enough to actually compensate them. The bribery is a veneer.

  52. Tony permalink
    May 15, 2012 9:00 pm

    “The government(s) will never give out enough to actually compensate them. ”

    Ha. Don’t make me laugh.

    This government is about to impose a tax nobody voted for, and nobody wants. In fact this government specifically promised it would never introduce any such tax.

    Any “compensation” is merely the return to its rightful owner of what was confiscated under false pretenses in the first place (after 45% of it is burnt after being churned through a bloated and useless public “service”).

    Thank you..

  53. el gordo permalink
    May 15, 2012 9:03 pm

    ‘largely due to stupid renewable schemes’

    That’s true, its written on the bills and the people notice.

  54. May 15, 2012 9:03 pm

    Why would I be laughing when I agree with everything you’ve said, in principle?

    Perhaps I chose my words poorly above?

  55. James of North Melbourne permalink
    May 15, 2012 9:18 pm

    Yeah I think Tony misread you there……

  56. Tony permalink
    May 15, 2012 9:19 pm

    Maybe. Just pointing out that governments only “give out” in “compensation” part of what they have confiscated – from mostly honest, usually hard-working people. The waste the rest.

  57. Tony permalink
    May 15, 2012 9:20 pm

    *They

  58. Neil of Sydney permalink
    May 15, 2012 9:28 pm

    We also have the NBN coming in the near future.

    My main worry about the NBN is going to be the cost. We all want high speed broadband but I think very few would be willing to pay say double what they are now paying.

    I was snowed under by bills at Christmas time and to my surprise Telstra let me change my internet plan from 200GB to 5GB download limit. I am now saving around $50.00/month on my combined phone/internet/mobile package.

  59. May 15, 2012 9:58 pm

    They taketh away & then, alarmingly, they seem to save a lot for calculated redistribution into key focus demographics which may, purely coincidentally, help them claw over the line so that they can reload & go again.

    The biggest joke of all is that there is an illusion of two, mutually exclusive choices.

  60. May 15, 2012 10:08 pm

    “Your prices are going up largely due to stupid renewable schemes and the feed in tariffs that come with them. If you voted Left you havelargely lost your right to complain about what you now have insofar as power prices were concerned.

    You made your bed……………..sleep soundly”

    Am I to believe that my utility bills would requisitely decrease under a ‘non-left’ arrangement?…because I don’t easily entertain unicorns.

    As I said, there are no such thing as tangible repeals once the rot has taken hold. The money is already conveniently hiddden & proves an easy windfall for any cohort.

  61. Bacchus permalink
    May 15, 2012 10:11 pm

    Maybe the word “illusion” is appropriate here. Chicken Little Tony Abbot is constantly telling everyone “we’re rooned, we’re rooned – the sky is falling, bad government” and the sheeple are believing the rhetoric.

    https://www.amp.com.au/wps/amp/au/FileProxy?vigurl=/vgn-ext-templating/fileMetadataInterface?ids=6c70701db0537310VgnVCM1000001903400aRCRD

    The latest AMP.NATSEM Income and Wealth Report shows Australian household income is outpacing the cost of living over the longer term, with disposable incomes increasing 20 per cent over the last 27 years.

    It says the average family is better off by $224 per week in real terms.

    AMP Financial Services managing director Craig Meller said the report shows households today are more focused on lifestyles and aspirations than they were in the 80s.

    “Many Australians are leading busier lives and facing greater demands on their time, which means we’re now paying for things we may not have previously, such as childcare, gardening and housekeeping,” Mr Meller said.

    Essentially we seem to be leading bigger lifestyles, all of which can add to perceived cost of living pressures.”

    The report says incomes have outpaced the cost of living across the board since 1984 and couples with children have seen their income grow by 37 per cent, single parent incomes have grown 34 per cent, and working families 22 per cent.

  62. el gordo permalink
    May 15, 2012 10:23 pm

    ‘Am I to believe that my utility bills would requisitely decrease under a ‘non-left’ arrangement?…’

    Ah…yes.

  63. Bacchus permalink
    May 15, 2012 10:32 pm

    Well Bacchus, as my power bills skyrocketed by some 20-30%

    I can’t believe it’s you who came back with that reb 😯

    I was replying to Jaws’ assertion that “people are sick of paying higher and higher taxes” by pointing out that his assertion re taxation may in fact be just rhetoric & you decide it’s all about electricity costs 🙄 Talk about “look over there!”

  64. May 15, 2012 10:38 pm

    Bacchus have you ever heard about indirect taxes ?

    Or has someone torn that chapter out of your 1930s economics class textbook ?

    Oh here we go…………………. levies v taxes and taxes v prices

    I’d say you have enough wind in you to obtain a grant from the Clean Energy Fund

    🙂

  65. May 15, 2012 10:41 pm

    730Report Ken Henry said the Euro will cease to exist

    I agree

  66. Bacchus permalink
    May 15, 2012 10:50 pm

    Yes Jaws – the GST is the most obvious example, but then we have customs and excise and property taxes 😉

  67. Meta permalink
    May 15, 2012 10:54 pm

    (Having taken a flight of fancy, possibly inspired by a takeaway obtained from the Other Place, I made the mistake of following-up on a suggestion that (re)viewing Christine Milne’s Green’s Delivery of a Budget Reply Speech was a worthwhile activity. I don’t know what planet She’s on, or from, but Earthians don’t do wellbeing measures or calculi beyond the financial-economic; or worrisome “jokes” about broad(er)-ban(ne)d choices.)

  68. Bacchus permalink
    May 15, 2012 11:03 pm

    And for all the Don Quixotes tilting at the electricity price increase windmill:

    In Australia, the 30% increase in retail electricity prices (or an increase of around 7c/kWh) has taken place before we have a carbon price. What’s going on there?

    Some of this is due to the increase in wholesale prices. In the last 10 years, wholesale electricity prices have increased by about 1c/kWh, driven by increase in demand.

    Plus, retailers now have to buy renewable energy certificates (RETs) to comply with the 20% renewables by 2020 target. In 2009, 8.8 million RETs were surrendered by the energy retailers, at a cost of around $350 million.

    It sounds like a lot, but averaged over the 220 TWh (terawatt hours) we use, it’s only 0.2c/kWh. So there’s 1.2 cents out of 7 cents explained.

    The rest is due to transmission and distribution costs, which are independent of the cost of generating the power in the first place.

    Transmission and distribution costs are going up because demand is going up. The average demand is increasing as the population increases, and in Victoria has gone from 5.3 GW in 2000 to 5.9 GW in 2009, but the maximum demand has gone from 7.7 GW in 2000 to 10.5 GW in 2009 (an increase of 35%).

    This is the demand on the hottest summer days, and the increase is mainly due to increased use of air-conditioners.

    The distribution system has to expand to cope with this extreme demand (even if it only happens once a year), and distribution is a significant part of the cost of electricity.

    If (or when) we get a carbon price, what impact will that really have on generation costs? Coal fired power stations in Victoria produce around 1.4 tonnes of CO2 for each megawatt hour (MWh) of electricity produced, which they sell on the wholesale market for around $40.

    So, if we have a carbon price and generators are paying around $25 for each tonne of CO2, then the price will go up by $35/MWh, or 3.5c/kWh.

    So, yes, electricity prices will increase in the future. But increased generating and distribution costs are the main drivers, due to an aging fleet of power plants and a change in the demand pattern which is increasing the distribution capacity requirements.

    http://theconversation.edu.au/increasing-electricity-prices-watts-the-culprit-1408

    So for the recent increases:
    * 14.3% is due to wholesale price rises, driven by increase in demand.
    * 2.3% is due to Renewable energy certificates.
    * 82.9% is due to transmission and distribution costs, which are driven up by all you bastards insisting on running your air conditioning at a low enough temperature to allow you to dress as if it’s winter all year round. Make safari suits compulsory office wear I say :mrgreen: (or shorts, long socks, sandals and open neck short sleeve shirts 😆 )

    Note: rounding error in these figures.

  69. James of North Melbourne permalink
    May 15, 2012 11:37 pm

    Sorry Bacchus but that reads like bullshit to me, and I know the source is a hotbed of bullshit. I believe it’s part renewable requirements and part profiteering, you know, unintended outcomes that are entirely forseeable.

  70. James of North Melbourne permalink
    May 15, 2012 11:45 pm

    What costs, for instance, are factored into transmission and distribution costs that didn’t already exist?

  71. Bacchus permalink
    May 16, 2012 1:27 am

    James, you’re starting to sound like Neil(s) 😯 “I know the source is a hotbed of bullshit.” Neil Translation – it’s not from a Liberal source, therefore it must be evil Labor propaganda 🙄

    I believe it’s part renewable requirements and part profiteering” I believe? Really?? I believe?? 😕

  72. James of North Melbourne permalink
    May 16, 2012 7:31 am

    Really what? I don’t get it.

  73. el gordo permalink
    May 16, 2012 9:12 am

    ‘The four-year, $15 billion household assistance package, linked directly to the carbon tax, begins from today.’

    Read more: http://www.smh.com.au/opinion/political-news/back-me-gillard-urges-unions-20120515-1yp4s.html#ixzz1uyzvMhh1

    Waste of money.

  74. JAWS permalink
    May 16, 2012 9:57 am

    Yeah Egg

    4 years as you said. But we are moving to an ETS in 2015. That’s when the market decides the price. And if the price is not $23 per tonne then Hello Budget Deficit.

    The we have the Mining Tax. Commodity prices have already dropped 20% on average. So there is likely to be a very very reduced revenue stream for Swan’s Mining Tax to bring anything like the $10B he’s predicted.

    In essence he has hooked us up to an annual recurring spending program contingent on a highly volatile tax revenue stream.

    How f**king stupid are these people ?

  75. el gordo permalink
    May 16, 2012 10:26 am

    ‘How f**king stupid are these people ?’

    The king has no clothes and this is transparent, so Abbott will continue his rage and scrap the taxes to make ends meet.

  76. Neil of Sydney permalink
    May 16, 2012 10:43 am

    In essence he has hooked us up to an annual recurring spending program contingent on a highly volatile tax revenue stream.”

    If you recall Labor made a similar charge against Costello. They say Costello wasted the mining boom which started in 2004 by handing money back as tax cuts and spending too much. Costello actually saved $16B, $17B and $20B in his last three budgets.

    So what does Labor plan to do with the extra mining tax revenue?? Spend it and/or hand it back as tax cuts.

    Hypocrites.

    Also the ALP are liars and the masters of deceit.

  77. TB Queensland permalink
    May 16, 2012 11:16 am

    Also the ALP are liars and the masters of deceit.

    Give it a fucking rest, Noddy!

  78. Tom of Melbourne permalink
    May 17, 2012 9:09 am

    Interesting speech to the ACTU Congress by Bill Kelty. Here are the key points-
    • It’s distressing to see the ALP so unpopular, but
    • This isn’t the fault of the media, you can’t blame the media
    • You can’t blame the opposition, they’re doing what you’d expect
    • You have to tell the truth

    There’s a few about the blogosphere who will now probably say – “what would he know?”

  79. Splatterbottom permalink
    May 17, 2012 9:48 am

    “You have to tell the truth”

    This one will stump them every time. They understand power, polls and spin but truth is a concept they do not understand.

  80. Neil of Sydney permalink
    May 17, 2012 1:57 pm

    “• You have to tell the truth”

    The implication by Kelty is that the ALP have not been telling the truth.

  81. el gordo permalink
    May 17, 2012 3:00 pm

    ‘David Cameron will today express grave doubts about the survival of the euro amid fears that a collapse could drag Britain into a decade-long depression.

    ‘He will warn of ‘perilous economic times’ and launch a startling attack on the failure of Germany and other major European countries to take the necessary steps if they want to prevent the euro breaking apart.

    ‘The eurozone is at a crossroads – it either has to make up, or it is looking at a potential break-up,’ the Prime Minister will say, insisting that sticking to the Government’s austerity measures is the only way to ‘keep Britain safe’.

    Read more: http://www.dailymail.co.uk/news/article-2145139/Eurozone-debt-crisis-Fears-panic-investors-pull-1-4billion-euro-days.html#ixzz1v6FdZqJa

    Good thing Australia is financially disconnected from Europe.

  82. el gordo permalink
    May 17, 2012 3:04 pm

    ‘Economists warned that the Greek financial system could crumble within weeks or days unless the European Central Bank steps up support.

    ‘President Karolos Papoulias told party leaders that banks had lost €700m in withdrawals on Monday alone as citizens rush to pre-empt capital controls and a much-feared return to the Drachma.’

    Ambrose Evans-Pritchard

    A capital flight before fresh elections, the punters are voting with their feet.

  83. el gordo permalink
    May 17, 2012 4:12 pm

    It’s okay, they have worked out an exit strategy…at a cost of 1 trillion euros or pounds.

    http://www.guardian.co.uk/global/2012/may/16/cost-greek-exit-euro-emerges

  84. el gordo permalink
    May 17, 2012 4:16 pm

    Grabbed this quote from the Guardian article.

    ‘Alistair Darling, who was Chancellor of the Exchequer under the former Labour administration, said: “This has the seeds of something disastrous. It is madness. If it spreads to bigger countries, this could be really disastrous for Europe. It could consign us to years of stagnation.”

  85. Splatterbottom permalink
    May 17, 2012 5:41 pm

    There is a lot of scary talk in that Guardian articl, gordo. Seems that the idea of a single currency is unsustainable without a more centralised government. No doubt the talk about “incalculable” losses if Greece exits is a prelude to calls for tighter political union. That will be another setback for democracy.

    I wonder whether they knew, when the Euro was introduced, that it would come to this?

  86. JAWS permalink
    May 17, 2012 8:01 pm

    The single currency was scoffed at way back in 1980 when I was doing 2nd year Economics with the background noise of some half crazed Young Liberal called Tony Abbott screeching against the Uni of Sydney Student Union and the Spartacists (Commos) across the campus.

    You cannot have a single currency unless you also give up your own sovereignty/fiscal policy.

    It wont work

  87. Tony permalink
    May 17, 2012 8:46 pm

    The Eurozone was a statist’s wet dream. Wake up, leftoids, it’s time to go to work. 😯

  88. JAWS permalink
    May 17, 2012 10:12 pm

    What happens to all the farm subsidies if it does. The WTO can hardly allow artificial trade barriers to prevent efficient farmers from entering the EU market again.

    Wow ………………………..we might have something really bizarre like New Caledonia being able to import NZ butter and milk rather than EU butter and EU powdered milk.

  89. el gordo permalink
    May 18, 2012 2:46 pm

    ‘As pandemonium struck Spain, Fitch slashed Greece’s credit rating deeper into junk, from B- to CCC, to “reflect the heightened risk that [it] may not be able to sustain membership of the monetary union” and warned that all eurozone members would be at risk of a downgrade if Greece exited.’

    Aldrick in the UK Telegraph

  90. JAWS permalink
    May 18, 2012 3:50 pm

    If there is a run on the Spanish Banks tonight then it will be curtains for Spain, Portugal and perhaps Italy. But I get the feeling that things wont be so bad for Italy as they don’t just rely on agriculture and tourism. The Italians obviously have heavy manufacturing (i.e. Alfa, Fiat, not to mention the expensive red ones and Lambos). Plus the Italians seem to have a deeper appreciation of their own responsibility of getting themselves out of the mess they are in.

    The Greeks just don’t get it. Their socialists seem to firmly believe the EU will cave in rather than se them exit.

    But I don’t think the Germans are going to “blink”.

  91. Splatterbottom permalink
    May 18, 2012 4:25 pm

    If the statements in the Guardian article Gordo linked to above about the cost to the EU of the Greeks defaulting are even close to the truth then it may be that they appreciate the strength of their bargaining position and are behaving rationally.

    Put another way, if the Germans and French are paying the Greeks as much for their own benefit as for the Greeks’ benefit then they are in no position to dictate austerity conditions.

  92. el gordo permalink
    May 18, 2012 4:25 pm

    There is the domino theory, where you only have to be in the vicinity to get knocked down, as the contagion spreads.

    The boom and bust of the capitalist model is a failure.

  93. JAWS permalink
    May 18, 2012 4:51 pm

    Keep in mind The Guardian is a main stream Left paper.

    So…………….they would say that .

  94. Splatterbottom permalink
    May 18, 2012 4:52 pm

    “The boom and bust of the capitalist model is a failure.”

    Economics is a form of psychology based mainly on the assumption that people prefer more to less. Market systems work because they harness that preference in a productive way.

    Marx screwed up so badly because he got the psychology wrong – socialism can’t get people out of bed in the morning much less incentivise them to work productively.

    Decisions about Investing capital and starting businesses will be better if they are widely distributed among investors and entrepreneurs than if they are made by the governments, another benefit of market systems. Even so the effectiveness of these decisions is limited by human psychology – they are subject to the so-called “animal spirits” of investors and entrepreneurs.

    The booms and busts and bubbles and runs on banks and investment fads and panics are products of the way humans think and behave. There are limits to the ways in which these can be smoothed out, while leaving enough of the market mechanism intact so it can operate to produce wealth.

    Schumpeter and his celebration of creative destruction as a necessary part of capitalism was a bit extreme for me, but there are definitely limits to the interference governments can impose on markets.

  95. James of North Melbourne permalink
    May 18, 2012 4:56 pm

    Socialism is incompatible with human nature and can only succeed at the point of a gun.

  96. Splatterbottom permalink
    May 18, 2012 4:56 pm

    “Keep in mind The Guardian is a main stream Left paper.”

    I’m fairly sure they will be pushing the line that the EU parliament will need to take more functions away from individual states so that the Euro can be preserved. This insistence on the preservation of the Euro is a bargaining chip for the Greeks.

  97. Splatterbottom permalink
    May 18, 2012 5:07 pm

    James the two concepts that most help me understand human nature are (to put them biblically although they needn’t be expressed that way) are original sin and redemption.

    Original sin explains why people, even ourselves, to bad stuff from time to time. As Kant observed: “Out of the crooked timber of humanity no straight thing was ever made”.

    Redemption explains that we can, despite our having done bad stuff, change our ways.

  98. JAWS permalink
    May 18, 2012 5:10 pm

    The EU Parliament needs to take over fiscal sovereignty from each member for Euro to survive.

    I doubt that’s going to happen………………… In fact it wont.

    Therefore its kaput !

  99. JAWS permalink
    May 18, 2012 5:13 pm

    “Redemption explains that we can, despite our having done bad stuff, change our ways.”

    Well the Greeks have a lot of redeeming to do

  100. el gordo permalink
    May 18, 2012 5:32 pm

    If we must have the boom and bust mechanism then surely we could plan for it in advance, but no it’s always different and nobody sees it coming.

    They manage recessions okay, yet this appears much bigger.

  101. el gordo permalink
    May 18, 2012 5:53 pm

    They are saying when Greece departs there will be a huge stock market rally and this is the plan to bring it about.

    ‘The ECB would cut interest rates, launch quantitative easing (QE), and back-stop Spain and Italy with mass bond purchases; the authorities would inject capital into the banks and create a pan-European system of deposit guarantees. The combined moves would be a major step towards EU fiscal union.’

    Ambrose Evans-Pritchard being optimistic for a change.

  102. el gordo permalink
    May 18, 2012 6:17 pm

    ‘…nobody sees it coming.’ That’s not entirely true, Mr Smith saw it coming years ago.

    ‘BANK funding markets are again closed because of the European debt crisis, but a Greek exit from the euro will not trigger a “Lehman-like shock” to the financial system, ANZ chief executive Mike Smith said.

    ‘Mr Smith told a business lunch in Melbourne that the crisis had been anticipated for months, if not a couple of years.’

    Richard Gluyas in the Oz.

  103. JAWS permalink
    May 18, 2012 9:28 pm

    Even for a Friday night a bit quiet around here

  104. el gordo permalink
    May 18, 2012 9:37 pm

    I get the impression I’m talking to myself, not that there is anything wrong with that.

  105. Neil of Sydney permalink
    May 18, 2012 9:41 pm

    Well Jaws if you have nothing to do perhaps you could give me your opinion about why our interest rates are so much higher than other countries??

    http://www.tradingeconomics.com/interest-rates-list-by-country

    Australia 3.75%
    Germany 1%
    France 1%
    Canada 1%
    UK 0.5%
    US 0.25%
    Japan 0%

    In 2007 both the US and UK had interest rates similar to ours. Theirs crashed but ours did not.

  106. JAWS permalink
    May 19, 2012 12:00 am

    Briefly Neil it was because Swan was driving the economy with foot on accelerator while the RBA was trying to put a foot on the brake via interest rates.

    Swan’s stimulus was far too big and people were screaming that same message. He started to create inflation and the RBA had to stop it.

    Other countries did not have the fiscal abilities we did and they relied on monetary policy alone to stimulate.

    Swan is an idiot

    This time next year Godforbid they last this long he’ll blame the EU foir missing his surplus.

    The fuckwit has already been told that Europe is screwed and so he cant use that as an excuse.

  107. JAWS permalink
    May 19, 2012 12:45 am

    Keynes would never have advocated spending money on school halls. Pantomimes do not add to economic activity. He meant spend it on highways ,bridges, training schools which always need to be built and make the economy more efficient .Even hospitals keep the workforce healthy.

    He advocated bringing expenditure forward. Productive expenditure that is.

  108. Neil of Sydney permalink
    May 19, 2012 3:41 am

    I get the impression that Ken Henry/Swan think that spending money was all that mattered..

    So you could spend money digging holes in the ground and then spend more money filling them back up again and the stimulus spending would have done its job.

    I think all we did was waste $50B dollars. But most people now have roofing insulation.

  109. el gordo permalink
    May 19, 2012 8:53 am

    I agree with Jaws about the infrastructure, but the barrackers say there was no time to put up major infrastructure like mass transport, so they settled for pink batts and school halls.

    I don’t accept that argument…the government overreacted.

    Scaper turned up at the cafe the other day, poorly projecting as usual, but he came up with an interesting story on The Ghan.

    It allegedly cost $1.3 billion to construct in the Howard years and we sold it to an American multinational for a third of the price.

  110. Tom of Melbourne permalink
    May 19, 2012 1:03 pm

    A LEADING Afghanistan expert has described as ”fairly way out” the Foreign Affairs Minister Bob Carr’s claim that Taliban participation would make a future Afghan government more sustainable.
    Professor William Maley, an internationally respected Afghanistan observer at the Australian National University, said the notion that the Taliban represented the Pashtun people and were therefore a necessary element in maintaining ethnic balances – as Senator Carr implied – was wrong.

    Is Rudd missed? Would he blunder the same way?

    Carr has an impressive voice, I’m starting to doubt his intellect matches it.

    A decent Premier, but perhaps not up to this job.

    Read more: http://www.theage.com.au/opinion/political-news/carr-way-out-on-call-for-taliban-to-get-seat-in-coalition-20120518-1yw0f.html#ixzz1vHTBnZ6o

    Meanwhile, barrackers have scorned Bill Kelty’s speech to the ACTU congress, he said –
    • You can’t blame the opposition, they’re doing what you’d expect
    • You can’t blame the media
    • You have to be honest.

    Straight taking from a loyal ALP servant is too much for some. Apparently they know better!

  111. May 19, 2012 1:26 pm

    Haha.

    I had a quick look and Nasking has put you & scaper in the same box, Tom! Apparently you’re both Liberal/Murdoch plants, sent to troll & sew discord amongst true believers.

    Funny.

    Scaper’s delusions of grandeur haven’t waned, he still likes publicly patting himself on the back & name dropping. Firmly enthralled by himself, but not bright enough to remember that the contrary statements he’s made in the past don’t add up unless they’re examined in isolation.
    I wonder how long his self control will last before he becomes his customary belligerent cnut self & froths at the poor Cafe crowd. 😯

  112. Tom of Melbourne permalink
    May 19, 2012 1:31 pm

    Yes!! Nasking certainly shows some strength of character!!

    He and Scaper could have a “great debate” on a similar intellectual level.

  113. el gordo permalink
    May 19, 2012 4:28 pm

    ‘…before he becomes his customary belligerent cnut self & froths at the poor Cafe crowd.’

    My guess he won’t risk a red card at the cafe because he sees this financial collapse as a vindication of what he has been saying for years. He needs a space to do that, where he can gain some street cred.

    What I would like to know, will the housing bubble burst soon or not at all?

  114. Tom of Melbourne permalink
    May 19, 2012 5:10 pm

    The housing bubble is bursting.

    A house around the corner sold today for a little over half the price it would have fetched a couple of years ago*

    I’m reasonably happy with that, it’s good for the affordability of young people.

    *It still sold for almost $2mill

  115. Tom of Melbourne permalink
    May 19, 2012 5:53 pm

    If Facebook is worth tens of billions, The Farnham Report must be worth a few million, (maybe ten?), given the quality of the writing and the intelligence of the contributors.

    SELL!

  116. el gordo permalink
    May 19, 2012 6:53 pm

    The property market in China has ‘come off the boil’ and is now falling, a similar percentage drop to Sydney and Melbourne.

    http://privatebriefing.com.au/2012/05/01/sydney-melbourne-house-prices-fall/

    Nice to be in tandem with our biggest trading partner.

  117. Tom of Melbourne permalink
    May 19, 2012 7:16 pm

    I’m about to head off for a bite to eat (and some good red), but I’d note that the pre-game of the “Dreamtime Game” is good.

    I’m at a complete loss to understand why there greater respect offered to indigenous culture.

    If business, sports and (particularly) the arts looked for more opportunity, it would do more for respect and reconciliation than any words uttered by politicians.

  118. Tom of Melbourne permalink
    May 19, 2012 7:16 pm

    …why there isn’t greater respect…

  119. Bacchus permalink
    May 19, 2012 7:20 pm

    Just occasionally you say something sensible ToM 😉

  120. Tom of Melbourne permalink
    May 19, 2012 10:27 pm

    Hmmm… maybe Bacchus. Red helps thinking. There should be more of it.

  121. JAWS permalink
    May 19, 2012 11:40 pm

    WatchIng Mladic at the Hague. Hearing about a woman witness being raped 50 yes FIFTy times in one night.

    Where does humanity go ?

  122. JAWS permalink
    May 20, 2012 12:14 am

    Flipped over to CNN and I find Alexis tsipras being interviewed .
    There is no hope if he gets the nod in the next election .

  123. JAWS permalink
    May 20, 2012 12:19 am

    His strategy is to find a nation that will be a “partner” with him. Usual crap of my argument sucks . I need another idiot to support me.

  124. JAWS permalink
    May 20, 2012 12:24 am

    Just rang a couple of Sydney brothels for research purposes. The receptionist on the phone couldnt hear me due to a chorus of “solidarity for ever” going on in the background .

    Why is it so ?

  125. Tom of Melbourne permalink
    May 20, 2012 8:55 am

    The Herald Sun reports-

    CRAIG Thomson claims he was not the de facto partner of his now wife Zoe Arnold in February 2009 when she bought the family’s current home and claimed a stamp duty exemption – even though Ms Arnold was pregnant with his child.

    Ms Arnold avoided $15,000 in stamp duty through a first-homeowner’s scheme on the Bateau Bay, NSW, property.
    The scheme forbids a homeowner to claim the stamp duty exemption if they have a spouse or de facto who has previously owned property.
    The First Home Plus scheme provided stamp duty exemptions for homes under $500,000 in NSW.
    The Labor MP maintains the de facto relationship began after Ms Arnold bought the property.
    Transfer documents were signed by Ms Arnold on February 20, 2009.
    Five days later, Mr Thomson changed his electoral enrolment to the Bateau Bay address.
    The couple later married in 2011.
    “We checked with authorities. She was perfectly entitled to buy the house in her name,” Mr Thomson told the Sunday Herald Sun.
    “We entered a de facto relationship some time after she bought. We in fact checked with the first home scheme.
    “You write anything and we will sue the s— out of you.”

    Poor Craig just can’t help himself. A bullsh!t artist in all circumstances.

  126. James of North Melbourne permalink
    May 20, 2012 8:59 am

    BLOODS!!!! We’re back!!

    (and I got the Quaddie)

  127. Tony permalink
    May 20, 2012 9:29 am

    ‘Poor Craig just can’t help himself. A bullsh!t artist in all circumstances.’

    Hah! Ancient history. We barrackers have moved on from that. The real stories are Bill Heffernan and Geoff Shaw. And they’re LIEberals! 😯

    http://news.smh.com.au/breaking-news-national/liberal-senator-accused-of-homophobia-20120520-1yyik.html

    http://www.heraldsun.com.au/news/liberal-mp-geoff-shaw-is-a-liar-say-whistleblowers/story-e6frf7jo-1226361102500

  128. el gordo permalink
    May 20, 2012 10:04 am

    Democracy is set to bloom in Egypt as polling shows people are moving away from the Muslim Brotherhood as they seek out candidates with a more ‘liberal’ hue. The Christians are breathing a sigh of relief.

    I like polls, they help clarify how everyone is thinking (even though some in Australia believe its a media conspiracy against the left wing government) polls are good for democracy.

  129. Tom of Melbourne permalink
    May 20, 2012 11:34 am

    Yes, the Herald Sun today devotes about 5 pages to the use of a fuel card by a <LIEberal MP!!

    What’s going on!!? Aren’t they only supposed to report that kind of stuff about the ALP!!???

    It seems News Ltd has lost its way.

  130. el gordo permalink
    May 20, 2012 11:48 am

    Gina’s Fairfax is the new hate media and of course the Australian Brainwashing Corporation is now getting abused by left wingers.

    LOL the world’s turned upside down.

  131. May 20, 2012 2:22 pm

    “he sees this financial collapse as a vindication of what he has been saying for years.”

    Bullshit. He’s been dribbling all manner of erratic crap for years. He only sounds wise if you haven’t been paying attention from the start. His posthumous claims with regard to the GFC are hollow.

    ” He needs a space to do that, where he can gain some street cred.”

    My sympathies go out to anyone foolish enough to imagine credibility at the bottom of that dry well.

  132. May 20, 2012 2:24 pm

    “BLOODS!!!! We’re back!!”

    Belting Melbourne is a real feat this year. 😆 😯

  133. el gordo permalink
    May 20, 2012 3:05 pm

    ‘My sympathies go out to anyone foolish enough to imagine credibility at the bottom of that dry well.’

    Everyone seemed to ignore him, so he didn’t have much success.

  134. Tom of Melbourne permalink
    May 20, 2012 5:31 pm

    http://www.theage.com.au/opinion/political-news/heffernan-accused-of-homophobic-assault-on-lib-20120519-1yxk2.html

    I’d be entirely happy to see the parliament say goodbye to Heffernan too.

    He seems like a dunderhead.

    Back to Thomson, only a day to go! Tomorrow we finally get to hear a pack of unsubstantiated, self serving lies that would be defamatory if uttered anywhere else, that will be proclaimed as a revelation by many would should know better the truth.

  135. May 20, 2012 5:42 pm

    Hello and good evening.

    Apologies for the lack of new posts lately…

    I’m still in NZ. I’ll be back in Melbourne next week…

    I’ll make sure we have a new post up shortly to discuss Craig’s “comprehensive statement” – A Ridley Scott Production – 12 years in the making!!!

  136. JAWS permalink
    May 20, 2012 10:50 pm

    Ridley Scott?

    I think given its likel early afternoon delivery………..

    More like “Days of Our Lies”

  137. Meta permalink
    May 21, 2012 2:08 am

    (Yes, it’ll be interesting to see if the FWA brings its claims to court, and how they’ll fare there; because the bulk of those (ac)claimed ‘findings’ seem predicated on some ‘interesting’ reasoning; insofar as the ‘reasoning’ the FWA suprascribes to/for its ‘findings’ seems by-and-large a (partial) parallel for the ‘findings’ on/contra the ‘unreasoning’ subscriptions of Craig; and the recursion factor, and potential for ‘case to answer’ implosion and/or explosion, thereby, high and/or low; but, that’s just my layperson’s read of the FWA Report in inverse. Or, regular second-guessing is either de rigeur or alternat(iv)ely excessive, I guess; and there’s always Windsor’s observation that Legislature’s make and amend laws, in a week where every MP and his dog has expressed a prospective interest.)

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