How the GFC 2 will impact your Christmas this year.

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Despite all the dark GFC 2 clouds forming it seems that Australians will be spending about $1,200 over Christmas this year.

Even with the rising costs of living and our ever shrinking wallets, it clearly seems that as a nation we are getting ready to spend up big this silly season.

Whilst this is not anything new it is somewhat a paradoxical situation where the biggest potential spenders are the ones who feel like they need more cash but are blind to the full impacts of the impending GFC2.

It seems that people are literally putting their head in the sand and in an attempt to ignore the dark headlines such as ‘austerity packages’, ‘crisis talks’, ‘stagnating economies’ and ‘price pressures’ that appear daily in the media.

Our incessant need for ‘best’ is making us worse off, locking us in a mindset where the items that we need are put on the back-burner in preference for ‘non-essential purchases’ such as flat screen tv’s and tv-games. Fact is, a recent survey by news.com.au found that 80% of respondents had bought something they didn’t need.

That survey went on to show a brilliant stat that 45.7% of adults who had just made a non-essential purchase of greater than $1,000 were extremely frustrated about the rising cost of living. Not only that, two thirds of those who had just spent the $1,000 had said that they needed a $100 extra a week in order for them to feel comfortable.

What is it with Australians?

Are we a bunch of complete idiots?

Seriously, I really hope we have a massive GFC in Australia the likes of what is occurring in the US, UK and half of Europe.

This will be the only way to get Australians to WAKE UP and take more care of themselves financially.

How many bloody 4WD’s can we have in CITIES, how many massive flat screen TV’s can we have in the homes of people who complain about the cost of groceries?

I’ve had enough.

Bring on the GFC. Bring on the pain and let it be the biggest wake up call Australia ever had!

Merry Christmas!

What do you think?

And now the CBA has woken up and started to fear a GFC 2

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Ralph Norris of the CBA has now finally caught up to what I’ve been saying for months: GFC 2 is on it’s way and it’s coming fast.

Yesterday a very peculiar thing happened in the debt stricken EU, one of the key economies Germany failed to sell its long term bonds shocking debt markets and sparking fears of a national scale Lehman brothers collapse.

Up until now Germany and France have been holding the plug in place in the currency bathtub, keeping the many weaker European states afloat despite the spreading fears of contagion.

Now France’s AAA rating is being questioned and Germany is suffering as investors are steering clear of the Euro only augmenting fears of the region breaking up in disarray.

Now all of this sounds absolutely atrocious, but at the same time I can’t help but to smell a rat. To quote Gail Kelly of Westpac “The various authorities in Europe actually have the capacity to deal with these issues – I certainly wish they’d get on with it and do it”.

At the end of the day Europe has the assets and power to burst out of this. So where is all this ‘recession’ coming from?

This begs the question – will the GFC 2 be rooted in real economic problems or will it be determined by the fund managers and nervous investors.

Regardless I’ve got a sneaky feeling this time Australia won’t be spared!

Your thoughts?

Five weeks to Christmas, five ways to save.

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With consumer confidence finally climbing back up, retailers are slowly becoming hopeful of a merry Christmas after last years let down. For us shoppers however, this means that the discount sprees that came early last year probably won’t start until Boxing Day.

Fortunately there are many ways you can save on all the presents and decorations that needs to be bought this season, and here are five things I’ll be doing to get more for less:

Get in the group-giving spirit

The world of gift giving is riddled with ‘political correctness’ which often makes us worried about how our gift will be perceived. One type of gift which often suffers because of this is the group gift, where you and your friends come together to buy something extra special to the people you love. Probably the biggest concern when doing this is what will happen when you mix friends with money as the last thing you want is for your present to turn into a source of conflict. Have a look at this great article on how to best manage a group buy so no one gets left out or shamed in the process.

Mobilise your coupons

With the internet and smartphone revolutions in full swing it’s easier than ever to find big savings near you. Apps like Deals on Deals and groupon sites like LivingSocial almost always save you 50% and often more or the original purchase price. This is the perfect way to spoil someone you love without turning your wallet into a crater. DealOnDeals is great because you don’t actually need to print out a coupon or pre-register. Simply download the app to your phone and start discovering deals and discounts on the map of your local area.

Go online, but be strategic

We all know that buying online is a sure fire way to save some of our hard earned cash. But what if the person you buy a present for decides to return it? This is a very common problem for savvy shoppers as the gift won’t be perfect unless it’s exactly what you wanted. Luckily, there is a very simple way around this, just ask the person to whom you are buying something for first! Truth is most of us don’t mind being asked about what’s high on the list this Christmas since it only means we get something we’ve been craving all year. Use that to your advantage, as your family and friends will then use this information to then go online and buy. It’s the perfect way to keep your Christmas budget in check and still give generous gifts.

If you have a credit card, use it! (Wisely)

Especially in the big spending months, credit card providers fall over themselves to try and attract your business which also means plenty of promotions and special offers. Check what they are offering and take advantage of it! It could be bonus frequent flyer points for your next holiday or zero interest periods. As a savvy shopper you can make your plastic work for you. But remember, there is always an asterisk somewhere, so make sure you check the reversion rates and don’t buy more that you can afford to pay off.

Start saving early

It might be too late to use a Christmas savings account for this season, but starting now could help you out for next year. The basic principle is easy, spread out the cost of festivities over the whole year and it’ll only cost you a small amount of every pay. Wait until last minute and you’ll have to find the full amount on the spot. Use sites like www.infochoice.com.au/ and www.ratecity.com.au/ to find the best option for you.

How are you saving this Christmas?

Tangible Proof of a ‘Two speed economy’

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A grocery survey by the Daily Telegraph of over 1000 people has uncovered some alarming facts about the state of our household finances. According to the survey ONE IN THREE people had gone WITHOUT FOOD in the past 12 months simply to be able to feed their kids.

Overall, 75% of families have had to cut back on some items or even cutting items out of the shopping list just to make ends meet. With many households already feeling the pressure of surging electricity and water bills, we are quickly running out of corners to cut leaving the food bill to bear the brunt.

Although our Supermarkets price wars are helping alleviate the situation a bit, they can’t keep lowering their prices forever. It’s no news that as the price of food goes down quality inevitably follows, and as much as we’d like to at some point the cost of groceries will have to stay put.

Despite what you may think about this survey, I see it as a very disturbing piece of news. Especially that we have so many fellow Australians in desperate need of help. Many of them probably living next door or just around the corner from us.

When you think about it, this survey raises a very big question. Why are we as a nation so hell bent on helping the rest of the world with their financial woes and ‘saving the planet with a Carbon Tax’ when we have an increasing number of working families in desperate need of financial assistance. Maybe, just maybe, we take a breather from being the saviour of the world (didn’t get the USA anywhere did it?) and seek out and help those who need some help. It’s an Australian mateship thing to do.

Perhaps we should think about the little recording that plays in an airplane just before you take off …”please make sure your secure and adjust your own mask before assisting others.”  Perhaps Australians need to focus on our fellow Aussies and lend a hand where we can.

Let’s not be like the US who spent decades helping everyone around except its own people but to only find itself in a depression like economic state.

Your thoughts?

More on why we hate banks: a personal story

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My aunty hasn’t been well lately and as a result the family has been gathering around to help with her day to day activities – one of which has been managing her bills and banking.

Under the mountain of statements and bills we discovered that she had a transaction account where she had $350,000 laying idle earning (get this) a paltry 0.01%pa.

On one hand we were delighted to find this as she now needs the money for some extra care however, we were simply DISGUSTED at her bank for not offering her a higher interest account. Here they were paying her a really low rate and probably earning a lot more when they lend it out.

Our stomachs fell to the floor when we calculated how much interest she could have earned in total over $226,000 in the last 10 years which translates into approx $1887 before tax per month. Now don’t get me started on how much I want to publically hang out to dry the bank in question and the “so called financial planner’ my aunty has. But as far as I am concerned this is a criminal activity. They are effectively stealing my Aunties livelihood.

With all of the new rules and regulations in the financial industry how could this fall through the cracks?

Now it’s personal.

Your thoughts? Has something similar happened to you?

More take, less give: why we hate banks

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It’s that time of year again! The profit results for the ‘big four’ are out and the results are nothing short of jaw dropping!

According to marketwatch.com, Westpac is in the lead with a massive $6.99billion in profit closely followed by the CBA at $6.39Billion. ANZ came in third with $5.36Billion and NAB at the bottom with ‘only’ $5.2billion NET PROFIT. Let me say that again NET PROFIT!

Put these figures together and you’ll see that just the big 4 banks made a staggering $23.94billion in combined profits.

Look I have no problem with banks making profits but I do have a problem with how they continue to market themselves as they live in our world or they give more and take less. What a load of rubbish. They don’t have any idea what it like in our world nor do they give more. Take for example last week’s rate cut by the RBA of 0.25%pa.

3 out of the 4 banks followed suit and passed on the full amount but the bank who has been marketing itself as giving more and taking less was the only stand out. They only dropped 0.20%pa. Hmm whatever happened to the More Give Less Take marketing slogan that NAB has been plastering all over the media to convince us consumers that they are not like the others?

By this action it clearly shows that they are a bunch of hypocrites and should never be trusted. They are all smoke and mirrors.

My thoughts on this are that as consumers we should take the hardest line of all here and be ultra mercenary. Milk whatever bank or financial institution that offers the best deal as much as you can.

There is no such thing as loyalty. Simply switch your banking as often as you can to get more for yourself.

I say we as consumers need to take a leaf out of the books of the banks. Give less and take more!

Your thoughts?

The Land of the Great Online Casino

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As the Government struggles to find a ‘quick fix’ solution to the mounting private debt in Australia no one is safe from their clasping reach. One of the proposed ways of helping us improve our financial standing is the controversial ‘pokey’ reforms that are affecting local communities all over Australia.

Don’t get me wrong, gambling is something which should only be undertaken in moderation, but I really don’t think that it is the pokeys in your local RSL that is the culprit of our worries.

Considering that Australians will gladly bet on two flies crawling up a wall, it gets a bit ridiculous when you’re required to have a de-facto licence to bet a dollar whilst mobile betting apps and online betting communities are left to flourish and grab the lions share.

What gets me even hotter under the collar is how the government is going after pokeys with the full armada yet happily letting betting advertisements become a part of our everyday TV content.

Watching the rugby cup last weekend for instance, every other commercial break had an ad for betting. Even the pre and post game commentaries somehow had betting integrated into the content of the presenters WHICH I FIND UTTERLY DISGUSTING.

Honestly, I reckon it’s time for Gillard to let Wilkie go ahead with his low-intensity machines, allowing RSLs and local communities to keep what little they have, and focus her efforts on getting a hold of the new Aussie ‘eVegas’ before it gets out of hand.

Is Australia at risk of becoming an eVegas? Shouldn’t we rather focus our efforts on education instead of moderation?

Your thoughts?

The cost of antics and instability

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A recent article in the Business spectator offers a disturbing insight into the state of the Australian property market.

The strange rules and stipulations for new property development and their lengthy approval processes are leading to massive increases in costs.

So much so, that according to Meriton founder Harry Triguboff, as much as $150,000 could be shaved off a $650,000 apartment if the local council antics were stopped.

What we need to do is to get the local governments to realise just how important affordable apartment living is to consumers and focus on finding ways to cut out the cost of ‘red tape.’

Your thoughts?

Little bites are causing a big decay

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A perfect storm is brewing inside Australia with the gap between the strongest and weakest industries being greater than ever before.

From a business confidence study conducted by NAB it shows that there are several factors underlying the deterioration of weaker sectors. The biggest concern was that the gap between two speed economy was actually getting wider. Scarily so it was not due to the larger sectors getting stronger but by smaller industries getting even weaker. Small business is hurting and hurting bad. Who cares you say? You should, as the small business community are a massive employer of Australians and the more that sector shrinks the more people that will be put out of a job.

It seems that in a nutshell simply don’t understand how what’s happening around their own day to day world. Sure they may read the news headlines and take in a few micro seconds of what’s happening in countries like Greece and the US but they unfortunately have no mechanism to aggregate all the news stories together to form one big picture.

Unfortunately that big picture is looking bleaker than the politicians would have us believe. We all seem to so well deluded by our ‘mining boom’ and the rhetoric from the government. The little bits of information you are receiving is hiding the massive decay.

This has been a concern for mine for quite some time now. As I said in a post back in September, we’re all just a bunch of lemmings. But as evidenced by the NAB falling business confidence report I fear that the ‘boom times we are bathing in are short numbered.

Every financial event adds up. The bite sized chunks of news in this country are contributing to the decay which is going to surprise many people and unfortunately cost them dearly. Just think about the last time you went to the dentist and they discovered a tooth that needed some work and cost you fair bit.

Your thoughts?

Time to clean up the sinister activities of banks

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Now I don’t have a problem in general with banks making profits and marketing themselves. But I literally see red when I observe unscrupulous marketing and sales activities that have no regard for the short term or long term financial well being of the consumer.

Take this case for instance. Featured in the Sunday Telegraph was a disturbing insight into just how far the ‘Big Four’ will go to get their bonuses even juicier.

Despite already expecting a $24.2bn combined profit this financial year, the banks have released ‘incentives’ for their staff to “double up” their sales of debt based products and insurances to squeeze even more from their ‘customers’.

Not that is so out of the ordinary but what is really on the nose is that these incentives are for their Christmas parties! Yes, you read it right, Their Christmas parties! What has the world come to?

I thought selling financial products knowing that you will receive a personal gain contravenes multiple ASIC rules and regulations..

Look, I’m sure they can find a million ways to get around this and defend it but let’s take a moral stand on this and pose the question.

Is this right for the working Australian? My answer is pretty simple No! And it should be regulated.

What do you think?

Have you recently been approached by an over zealous bank employee that wanted to flog you extras?

Have they completely lost the plot? Are the desperate to make up for some of the lost revenues. Give me a break. Here we are looking to our banks to be the bastion of financial moderation as we see this behaviour.