It's the economy, stupid!

 
  Gayspie Assistant Commissioner

Location: Adelaide, SA
What happens when official interest rates hit zero and become negative ?

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  don_dunstan Minister for Railways

Location: Adelaide proud
Totally uncharted territory in this country, Heath. Central bank bond rates overseas (Japan, Germany) have been negative for some time.

The reason that global negative interest rates are being discussed seriously by the International Monetary Fund is that they want investors to move their money out of traditionally 'safe' investments like banks and bonds and put the money into businesses or real estate. Our staunchly pro-realestate industry Prime Minister will be really interested in any means by which we can prop up the housing market after the last two years of national jitters.

The only issue is that they'll have to remove cash from circulation because the temptation of savers to simply remove their money from the banking system will be too great. That's not unprecedented though; lots of old Italians and Greeks in particular would hoard cash because they came from an unstable system where banks couldn't be trusted so culturally they horded cash.

History repeating?
  wobert Chief Commissioner

Location: Half way between Propodolla and Kinimakatka
If you've got a spare hour, well worth it

https://www.macrobusiness.com.au/2019/10/bass-chinese-economy-a-quarter-smaller-than-claimed/
  wobert Chief Commissioner

Location: Half way between Propodolla and Kinimakatka
And then for a laff

https://www.macrobusiness.com.au/2019/10/prospects-for-aussie-imports-of-its-own-gas-grow/
  Carnot Chief Commissioner

And then for a laff

https://www.macrobusiness.com.au/2019/10/prospects-for-aussie-imports-of-its-own-gas-grow/
wobert
ACCC anyone?  Hello?  Is anyone home?
  Valvegear Dr Beeching

Location: Norda Fittazroy
The big four banks have all failed to pass on the full rate cut, and Sco Mo's inevitable comment is, "They'll never learn".  No, Mr. Morrison; it's the RBA and the Government who'll never learn. The banks have learnt perfectly; "Here's more profit and we don't have to do any work to get it."
  don_dunstan Minister for Railways

Location: Adelaide proud
And then for a laff

https://www.macrobusiness.com.au/2019/10/prospects-for-aussie-imports-of-its-own-gas-grow/
ACCC anyone?  Hello?  Is anyone home?
Carnot
No - they're all out at industry-sponsored lunches -
  Carnot Chief Commissioner

Low interest rates, avoiding tax and bank fees....  stuff your cash under the mattress:
https://www.dailymail.co.uk/news/article-7527923/Reserve-Bank-reveals-half-Australias-banknotes-stored-bed-cupboard.html
  don_dunstan Minister for Railways

Location: Adelaide proud
And then for a laff

https://www.macrobusiness.com.au/2019/10/prospects-for-aussie-imports-of-its-own-gas-grow/
wobert
If we ever needed any evidence that our elites have no care whatsoever it's the nightmare of our domestic gas situation.

So the Japanese can buy it for a few cents a litre and then sell it back to us - because it's actually cheaper for us to buy it that way? Have a think about what's actually going on here - our own gas gets liquefied, loaded onto huge ships and sent to the other side of the planet. It then comes back to Australia, gets re-gassified and sent back on-shore for our own use.

It's actually cheaper for us to buy this world-travelling gas than it is for us to buy our own gas - how did this absolutely absurd situation develop? Why is it allowed to persist? Why aren't Aussie consumers and industry allowed to get the super-cheap Japanese gas BEFORE it goes off-shore?
  michaelgm Chief Commissioner

Don, open to correction but Johnny Howard was at the helm when this arrangement For cheap exported gas came to be.
  bingley hall Minister for Railways

Location: Last train to Skaville
And then for a laff

https://www.macrobusiness.com.au/2019/10/prospects-for-aussie-imports-of-its-own-gas-grow/
If we ever needed any evidence that our elites have no care whatsoever it's the nightmare of our domestic gas situation.

So the Japanese can buy it for a few cents a litre and then sell it back to us - because it's actually cheaper for us to buy it that way? Have a think about what's actually going on here - our own gas gets liquefied, loaded onto huge ships and sent to the other side of the planet. It then comes back to Australia, gets re-gassified and sent back on-shore for our own use.

It's actually cheaper for us to buy this world-travelling gas than it is for us to buy our own gas - how did this absolutely absurd situation develop? Why is it allowed to persist? Why aren't Aussie consumers and industry allowed to get the super-cheap Japanese gas BEFORE it goes off-shore?
don_dunstan

Lazy, lazy, lazy............

Throwing terms like 'elites' around yet again without explaining who the elites are exactly in this case - I bet you can't do it without mentioning Hawke and Keating Razz

No attempt as usual to explain how you see things being done differently.

You bleat about Australian industry being denied cheap gas, but forget to mention that plenty of Australian businesses are happy to benefit from such practices.
  don_dunstan Minister for Railways

Location: Adelaide proud
Lazy, lazy, lazy............

Throwing terms like 'elites' around yet again without explaining who the elites are exactly in this case - I bet you can't do it without mentioning Hawke and Keating Razz

No attempt as usual to explain how you see things being done differently.

You bleat about Australian industry being denied cheap gas, but forget to mention that plenty of Australian businesses are happy to benefit from such practices.
bingley hall
So nice of you to bob up and whinge about how I don't have any answers. Do you?

And actually it was those Labor Party geniuses Rudd and Gillard who signed off on the building of the export terminals in Queensland designed to suck every last joule of gas out of our country and off-shore it.

Who are Australian businesses benefiting from hugely expensive gas? Chevron, Shell? Yeah they're as true blue as you and me, aren't they.
  bingley hall Minister for Railways

Location: Last train to Skaville
Lazy, lazy, lazy............

Throwing terms like 'elites' around yet again without explaining who the elites are exactly in this case - I bet you can't do it without mentioning Hawke and Keating Razz

No attempt as usual to explain how you see things being done differently.

You bleat about Australian industry being denied cheap gas, but forget to mention that plenty of Australian businesses are happy to benefit from such practices.
So nice of you to bob up and whinge about how I don't have any answers. Do you?
don_dunstan

I don't need to have the answers. I am not the one branding everyone that doesn't fit in with your world view (or lack of it) as an 'elitist'.

The coalition have been in power for 6 years and have another 3 years ahead of them. Why haven't they come up with a policy to reverse this. What is Pauline Hanson's policy on this. Does she even have one? If not then she must also be an elitist.
  don_dunstan Minister for Railways

Location: Adelaide proud
I don't need to have the answers. I am not the one branding everyone that doesn't fit in with your world view (or lack of it) as an 'elitist'.
bingley hall
Bravo for having a go at me without a clue as to what you'd do yourself.
The coalition have been in power for 6 years and have another 3 years ahead of them. Why haven't they come up with a policy to reverse this. What is Pauline Hanson's policy on this. Does she even have one? If not then she must also be an elitist.
bingley hall
Domestic gas reservation policy, anyone?
  Carnot Chief Commissioner

New Car sales in Australia are in free-fall:
https://www.caradvice.com.au/797477/vfacts-september-2019/

"The Australian car market continued to decline in September 2019, with a 6.9 per cent drop in sales making it the 18th consecutive month of decline."

Near zero cash Interest rate, rising employment, falling car sales, rising fuel prices, drought-affected agriculture sector, $70 billion wiped off Stock market in two days .....
  don_dunstan Minister for Railways

Location: Adelaide proud
New Car sales in Australia are in free-fall:
https://www.caradvice.com.au/797477/vfacts-september-2019/

"The Australian car market continued to decline in September 2019, with a 6.9 per cent drop in sales making it the 18th consecutive month of decline."

Near zero cash Interest rate, rising employment, falling car sales, rising fuel prices, drought-affected agriculture sector, $70 billion wiped off Stock market in two days .....
Carnot
Holden posted its lowest sales in Australia - ever; Car Advice: (from the same reference)

It is the first time Holden’s monthly sales tally has dipped below 3000, which was also enough to push the brand outside the Top 10.

Overall, the new vehicle market was down by 7.9 per cent year-to-date and down by 6.9 per cent in September 2019 compared to the same month the prior year.

A statement from Holden said: “It is a disappointing result and clearly not where we want to be. A couple of factors contributed, including delays in delivering several batches of Colorados to fleet and rental customers, and a significant sell down of dealer demonstrator inventory as a result of our demonstrator clearance sale.”

Car sales in Australia one of lowest levels in many years - even charities are feeling the pressure with White Ribbon collapsing...
  Valvegear Dr Beeching

Location: Norda Fittazroy
Bravo for having a go at me without a clue as to what you'd do yourself.
"don_dunstan"
That's not what bingley is doing. He's asking you to explain who "the elites" are. You use the term; you explain when asked; simples.
  bingley hall Minister for Railways

Location: Last train to Skaville
New Car sales in Australia are in free-fall:
https://www.caradvice.com.au/797477/vfacts-september-2019/

"The Australian car market continued to decline in September 2019, with a 6.9 per cent drop in sales making it the 18th consecutive month of decline."

Near zero cash Interest rate, rising employment, falling car sales, rising fuel prices, drought-affected agriculture sector, $70 billion wiped off Stock market in two days .....
Carnot

Deflection 101 by Scott Morrison at the Lowy Institute yesterday  

Scott's says he wants to grow the economy, but of course after 6 years of Coalition rule things continue to go backwards for the average punter, so what to do?

Got it - blame the elitists at the UN Razz
  don_dunstan Minister for Railways

Location: Adelaide proud
Bravo for having a go at me without a clue as to what you'd do yourself.
That's not what bingley is doing. He's asking you to explain who "the elites" are. You use the term; you explain when asked; simples.
Valvegear
Seemed like a very roundabout way to ask me what I thought "elites" were.
  don_dunstan Minister for Railways

Location: Adelaide proud
New Car sales in Australia are in free-fall:
https://www.caradvice.com.au/797477/vfacts-september-2019/

"The Australian car market continued to decline in September 2019, with a 6.9 per cent drop in sales making it the 18th consecutive month of decline."

Near zero cash Interest rate, rising employment, falling car sales, rising fuel prices, drought-affected agriculture sector, $70 billion wiped off Stock market in two days .....

Deflection 101 by Scott Morrison at the Lowy Institute yesterday  

Scott's says he wants to grow the economy, but of course after 6 years of Coalition rule things continue to go backwards for the average punter, so what to do?

Got it - blame the elitists at the UN Razz
bingley hall
You could see Scotty boy getting excited at the zeitgeist of TRUMP when he was opening that Visy Board factory with Anthony Pratt and Trump in the United States. "We're all about JOBS" he cried.

This is just a continuation of what he perceived as the successful nationalist style that Trump has been pushing - and ScoMo wants IN. The problem is that there's a pretty large autocracy who won't be happy to hear some of the things that he said at the Lowy Institute last night - especially the bit about protecting our national interest in all situations.

Don't want our minions growing a spine all the sudden do we...
  don_dunstan Minister for Railways

Location: Adelaide proud
More bad news for my home state: Confidential document obtained by Senator Patrick shows that Department of Defense is planning to move the ASC project submarine maintenance to Fremantle WA - ABC.

Maintenance of Collins Class submarines could disappear from Adelaide shipyards by 2024, impacting hundreds of businesses and jobs in the state, Freedom of Information (FOI) documents have revealed.

The documents provided by Centre Alliance senator Rex Patrick include a letter from Rear Admiral Greg Sammut of the Royal Australian Navy to Naval Group executive director Jean-Michel Billig.

The letter includes instructions for the shipyards in Osborne, which is currently used to maintain the fleet, to be designed without Adelaide playing a role in future submarine maintenance work beyond 2024.

How much more bad news can South Australia take? First they take away all our car manufacturing jobs, now they're steadily taking away the defense jobs that were supposed to rescue us from economic oblivion. We already have the highest unemployment in Australia and the Commonwealth is about to make it even worse.

Where is Poodles Pyne when you need him?
  Valvegear Dr Beeching

Location: Norda Fittazroy
Seemed like a very roundabout way to ask me what I thought "elites" were.
"don_dunstan"
There we are bingley; I thought he either didn't know or wouldn't give a straight answer. (Standard Operating Procedure).
  don_dunstan Minister for Railways

Location: Adelaide proud
Seemed like a very roundabout way to ask me what I thought "elites" were.
There we are bingley; I thought he either didn't know or wouldn't give a straight answer. (Standard Operating Procedure).
Valvegear
Okay well let's define it as politicians, media personalities and the captains of industry who think they know what's best for the nation. Or is that too broad for you.

Honestly I know you worship the very ground that I walk on but there's no need to cry into your pillow when I don't respond to your queries on time and in the manner you want.
  DirtyBallast Chief Commissioner

Location: I was here first. You're only visiting.
The big four banks have all failed to pass on the full rate cut, and Sco Mo's inevitable comment is, "They'll never learn".  No, Mr. Morrison; it's the RBA and the Government who'll never learn. The banks have learnt perfectly; "Here's more profit and we don't have to do any work to get it."
Valvegear
Rubbish.

Banks might borrow some money from overseas to pass onto their clients applying for a loan, but they also source a lot of money from their depositors. They are already sourcing much of this money for zero interest. Their profits decrease whenever the RBA cuts; they are forced to charge less for interest on loans but their source of money is barely cheaper overall.

As a result their profits decrease, their dividends come under pressure (resulting in less disposable income for many), and your superannuation account will probably suffer as well.

Too many people get sucked in by the headline profit of banks without realising how thin their profit margins actually are.
  don_dunstan Minister for Railways

Location: Adelaide proud
Rubbish.

Banks might borrow some money from overseas to pass onto their clients applying for a loan, but they also source a lot of money from their depositors. They are already sourcing much of this money for zero interest. Their profits decrease whenever the RBA cuts; they are forced to charge less for interest on loans but their source of money is barely cheaper overall.

As a result their profits decrease, their dividends come under pressure (resulting in less disposable income for many), and your superannuation account will probably suffer as well.

Too many people get sucked in by the headline profit of banks without realising how thin their profit margins actually are.
DirtyBallast
I find myself in rare agreement with you - at these sorts of extremely low interest rate settings there's not much room for the banks themselves to move because most of their capital is coming from off-shore and they don't have control over the rates they pay to borrow from the international credit system. The banks are still very profitable (that's true) but the margins that they operate on for mortgages in particular are very thin because its quite a competitive market.

The thing that I've found very curious is that the Commonwealth Bank only passed on a small percentage of the cut (0.17%) to retail owner-occupiers but then the full cut (0.25%) was given to interest-only investment borrowers. Surely the second category is higher risk?

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