Now, according to today’s Australian Financial Review, our Aussie banks “have been given 1 week by regulators to stress test how they would handle a spike in joblessness, plunge in home prices spurred by EU debt crisis.”
In other words, to prepare for meltdown.
According to Bloomberg:
Australian Prudential Regulation Authority envision worst-case scenario of 12% unemployment, 30% drop in house prices, 40% fall in commercial property values, AFR says
Banks will assume that write-offs, other mitigation measures are unavailable; later stress tests might allow for such steps, AFR says
Australia’s banks have A$87.2b of exposure to Europe, or 2.7% of assets, with A$74.6b of it mostly tied to bank borrowers in France, Germany, Netherlands, AFR says, citing RBA statistics
No doubt our banks will come through these self-conducted “stress tests” … a la the farcical self-conducted “stress tests” that have been repeatedly passed by EU banks … with flying colours.
It’s all about public con-fidence, you see.
The entire modern financial system is built on con-fidence.
Without your continued con-fidence in the banksters’ system, their obscene wealth-from-debt-slavery machine implodes.
As with every con-fidence trick, it’s just a matter of time before a critical mass wakes up (pun intended).
If ever a TV panel discussion typified the galactic disconnect between the collective wisdom of the Australian public, and the infinite stupidity of our self-proclaimed (pseudo)intellectual betters, then Sunday’s ABC Insiders program demonstrated it to the full.
The topic? The government’s planned increase in the compulsory superannuation rate from 9% to 12% –
Watch the segment, and note carefully the man taking up the baton for the collective wisdom of Neville and Sue Ordinary Voter.
Mr Brian Toohey, of the Australian Financial Review.
An old bloke.
A gentle bloke.
A sometimes stammering bloke.
A thoughtful, observant bloke.
A bloke who wrote an AFR column titled “Big sister knows what’s best for you” on just this topic back in February (summary via Media Monitors):
Proposed increases to compulsory superannuation contributions are unwarranted and under-scrutinised. The Gillard government does not trust citizens to allocate their own resources responsibly. Federal Treasurer Wayne Swan spent the revenue from the failed Resources Super Profits Tax, now whittled down into the minerals resource rent tax, without considering future colossal expenditure on defence, health care, disability services and general maintenance of a rapidly aging population. Instead, these funds were allocated to the aforementioned super contribution increase and company tax cuts. Bill Shorten, Superannuation Minister, even told the Australian Workers Union conference last week that he would push for a bigger increase than had been initially announced. Enforced superannuation itself belittles the everyday, responsible citizen, and does not help ‘working families’ in the slightest.
Brian, you are my newest hero.
Note carefully too, those disputing most forcefully with Mr Toohey on the Insiders program.
The program host. A long time employee of the “Left”.
And a younger bloke. The Political Editor for a major city newspaper, and the most unashamed espouser of the arrogant “Government knows best, ordinary people are idiots” line of unreasoning.
What we have here then, is a 2-pack of Canberra press dogs, rounding on a wise old bloke.
And why?
Because he dares to declare that Neville and Sue Ordinary Voter are smart enough to know and do what’s best for themselves, with their own money.
Quelle horror!
Isn’t it interesting though.
Even when the facts prove they’ve been utterly wrong, these immaculately-clipped Canberra journo’s poodles will always return to their vomit.
Rather like their mates, the mainstream Australian economists.
Those same drooling imbeciles who all utterly failed to foresee GFC1 coming:
Senator Barnaby Joyce was laughed out of his opposition finance portfolio for his forecasts that included saying more than 18 months ago that the US could default on its debts.
It’s not so funny anymore, as veteran journalist Michelle Grattan said last week on Twitter.
“US struggling through its crisis – remember how we laughed at Barnaby when he raised the spectre of US default? Oops.”
Joyce certainly remembers.
“I got absolutely smashed by (Kevin) Rudd and (Lindsay) Tanner and Swan,” he said.
“To be honest, my own side got scared, and said ‘we think you’ve gone out on a limb’.
“I was listening to one last night, I was almost about to drive off the road it was pissing me off so much. I remember exactly what this person was saying on how wrong I was.”
I found the cognitive dissonance of Mr Kenny particularly telling.
All the panellists recognised that (quite unlike our spendthrift government) ordinary Aussies have been responding to GFC1 by doing the sensible, practical, wise thing.
Saving money.
And yet, Mr Kenny still arrogantly insisted on spouting off with a high-minded stereotype – that if allowed to keep more of their own money, ordinary voters would spend it all on flat screen TV’s.
Whereas Mr Toohey sagely pointed out the truth:
You get better economic outcomes if you let people make their own mind up how to allocate their income … it’s just a matter of standard economic theory which happens to be correct in this case…
Indeed.
And you get even better economic outcomes if you basically ignore everything the mainstream economists say.
Or best of all, if you adopt the opposite view to the “mainstream”, as your default position. On everything.
Adopting that contrarian attitude is at least partly how your humble blogger was (like many other ordinary Aussies) able to see the writing on the wall in America, when none of our mainstream economists could.
And contrary to strident “professional” “expert” advice, pull all his super out of the global sharemarkets in May 2007:
As we all know, the fit has hit the shan in global sharemarkets once again.
And what we have here, ladies and gentlemen, is a government wanting to force employers to somehow find another 3% (or more, if Shorten has his way) on top of workers’ salaries … to pour into the sharemarkets!?!
Do you really imagine that, in the present global economic environment, this would not lead directly to job cuts?
Do you really imagine that it would not lead to even more money going up down in red LED’s … with parasitical, useless, butt-lazy, white-collared, producers-of-nothing professional “fund managers” waltzing away with their percentage cut of your vapourised superannuation money, regardless of the outcome for you?
The Insiders panel discussion this Sunday typified one of the biggest problems in this country.
The arrogance of those who think they are better, and know better, than We The People.
Our lamestream ivory-towered Canberra lapdogs simply cannot bear to conceive of the possibility that (shudder!) ordinary voters might be the best people to decide what to do with their own money.
Media Release – Senator Barnaby Joyce, 30 March 2010:
Reports in the Australian Financial Review today confirm that Penny Wong is presiding over a water buy back scheme that is frittering away money. Senator Joyce said “reports suggesting that Penny Wong has overpaid to the tune of $40 million and that some water sellers are getting special deals fuel the confusion and uncertainty surrounding Senator Wong’s plan for the Basin. Who expects irrigators to invest in water-saving technology in this climate of confusion?”
Senator Joyce spoke yesterday to a number of irrigators and farmers. These initial discussions have confirmed reports in the media today. The Government is not providing sufficient feedback on the status of some farmer’s tenders. As the Productivity Commission reported last year, Senator Wong’s scheme has also failed to recognize the effects on local communities of farms closing down. Senator Joyce will be travelling along the Basin over the next few weeks to get first-hand experience of these impacts.
Senator Joyce reiterated that he has no problems with the buying of water, or moving towards to a nationally coordinated use of water from the Murray-Darling Basin. “We need a water policy that provides jobs in regional areas, guarantees food security for all Australians and protects the environment. Current policy appears to ignore this triple-bottom line approach,” Senator Joyce said.
"Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers."
Barnaby Is Right 
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