Tag Archives: Debt

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?

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?

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.

Here comes GFC 2

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I’m going to make a prediction that I can guarantee will raise a few eyebrows.

The Australian economy will slide into a slow motion GFC over the coming 6 months.

A big call I know. But if you read between the lines of all the data and hype put out by the government and the media – Australia is up to it’s eyeballs in debt and hurtling towards an economic train wreck of train wrecks.

Oh, but what about the boom that we are in you say? Well, unless you are in the mining sector, not many other industries are experiencing boom time growth (just ask the retailers).

Leaving the rest of us mere mortals hocked up to the hilt and facing ever increasing day to day cost of living hikes. When it comes to debt, we as a nation over the past 20 odd years  have been partying like there’s no tommorow, consuming things for the now and payng for them using someone else’s money (ie the banks). The amount of debt we have racked as a result up is staggering having grown from $500 billion to just over $1.1 trillion in 5 years!!! All of which on home loans, credit cards and personal loans.

Now if you add this ticking time bomb to the government debt problems of the US and many European Union members it is little wonder why the world is teetering on the brink of a GFC 2. Sooner or later their weak economies will affect us. Not so much directly but indirectly as ultimately China is dragged into this financial mess.

You see China’s major export partners are the US and Europe and with them slowing down the Chinese ecomomy will start to slow. Hence, you guessed it, they will slow down on their need for the massive quantities of raw materials from Australia.

So as you can see in this simple scenario, our lucky country may not be luck for too much longer. Batten down the hatches as slow moving ecomomic storm cell is approaching.

Can’t think it can happen to Australia? Just ask anyone from the US, UK and Ireland.

Am I being too over reactionary? Maybe!

Your thoughts?