Australian banks are eyeing opportunities to cash in on the proposed carbon tax by developing new financial products and services that capitalise on a market seen to be worth billions of dollars annually, according to a report by the Australian Financial Review.
Australian financial firms that have experience in European carbon markets, such as Macquarie Group Ltd, Westpac Banking Corp Ltd and ANZ Banking Group Ltd are particularly keen to establish their presence in the Australian market.
The initial three-year fixed carbon tax period from 2012 will serve as time to prepare for the release of ETS permits by 2015, when opportunities will really open up for banks to capitalise on the carbon market.
Here’s a couple of quotes from that article. The first is in reference to the “initial fixed price period” that the Government would have you believe is “like a tax”:
I was right.
The carbon permits will have no expiry date.
They are an artificial construct – “an electronic entry” – that is deemed by government decree to be a new “financial product”.
Moreover, note carefully the sentence I have bold underlined.
The “creation of equitable interests”, and “taking security over them”, simply means this. The carbon permits can be used as the basis for bankers to create other, new financial “securities”.
Carbon derivatives, in other words.
Derivatives (or “securities”) are the toxic, wholly-artificial financial “products” that were at the heart of the GFC. The same bankster-designed “widgets” that the world’s most famous investor, Warren Buffet, spoke of as “a mega-catastrophic risk”, “financial weapons of mass destruction”, and a “time bomb”.
You can stop reading this piece right now if you like.
Because from that Table 6 alone, you now have conclusive proof that this is nothing whatsoever to do with the climate.
It is all – and only – about global bankster profits. At the direct expense of the common people of planet earth.
Note well. The banks do not have to wait until the “flexible price period” commences after 3 years, to begin creating their “securities” (ie, derivatives), based on the notion of the underlying “value” of the “fixed price” carbon permits.
The Government’s scheme allows this from Day 1. Naturally. Because that is what the banksters – and their “leading economist” shills – are all salivating over. A government-decreed excuse, to create a whole new kind of “derivatives” market. It is the whole point of the scheme.
In specific reference to the “flexible price period” to follow three years later, I wrote this:
Now, why have I bold underlined “borrowing“?
And why have I bold underlined “advance auctions of flexible price permits…”?
Because these are the key words from the “banking and borrowing” section. The words that tell you all you need to know.
That this SCAM is nothing whatsoever to do with the global climate.
And that it is 100% about creating a new, global, CO2 derivatives-trading market for the banksters.
The world’s biggest-ever financial cesspool.
Of toxic, intrinsically-worthless, humanity-raping financial “instruments” called derivatives.
Non-existent, digital “widgets”.
That can be borrowed from the future – ie, before these artificial carbon “widgets” are even issued – and leveraged by scum-of-the-earth banksters.
And then, traded by these parasites at multiples of hundreds and thousands of times more than the underlying, artificially-created “value” of the carbon permit.
Furthermore, the “advance auctions of flexible price permits in the fixed price period” proves beyond all shadow of doubt, that I was right.
That this “carbon pricing mechanism” is the bankers’ CPRS by another name. From Day 1.
Why does it prove it?
The advance auctions of flexible price permits “in the fixed price period” means this.
From Day 1, the government is effectively allowing the setting up of a futures trading market, for Australian CO2 permits.
Futures trading of nothing. Before the nothing is even created.
The banksters’ wet dream.
Australia – you have been monumentally conned.
The Green-Labor-Independent Alliance’s plan to “save the planet”, is a gigantic scam.
It is the bankers’ Casino Royale.
Where “carbon permits” really means, “A Licence to Print”.
Thank you, Australian Financial Review and Business Spectator.
For confirming that I was right.
Oh … just one more thing.
To help give you some idea – a picture in your mind – of how gigantic the new (government-rigged) “market” for the banksters’ carbon derivatives can become, take a look at the following chart, sourced from the RBA’s Statistics data.
It shows the size of our banks’ current holdings of Off-Balance Sheet derivatives bets, on the future of Interest Rates, and Foreign Exchange Rates:
Click to enlarge
Yes, that’s $3.98 Trillion in Foreign Exchange derivatives bets. And a whopping $11.68 Trillion in Interest Rate derivatives bets. Off-Balance Sheet. At March 2011.
Here’s another chart – also sourced from RBA data – showing our banks’ current On-Balance Sheet “Assets” (66% of which are actually loans) – the blue line – compared to their total Off-Balance Sheet “Business” (ie, derivatives) – the red line:
Click to enlarge
Yes, that’s $2.68 Trillion in “Assets” (mostly loans). Compared to … $16.8 Trillion in Off-Balance Sheet derivatives gambling. Mostly on Interest Rates, and Foreign Exchange rates.
Just try to imagine the size of the brand new carbon dioxide “hot air” derivatives market casino that our banksters’ will create, in the form of leveraged bets on the underlying so-called “value” of carbon permits.
Adoration of the Golden Calf - Nicolas Poussin, 1629
The Treasury department is – like many false idols – placed up on a pedestal and revered as some kind of infallible authority.
An economic god.
And when it comes to our Green-Labor-Independent minority dictatorship’s newly finalised “carbon pricing mechanism”, the infinite wisdom of the Treasury department will once again be held up as the final Word.
We are talking, of course, about a government department long headed by well known green cargo cult members. True believers in the warmist cult, such as former Treasury secretary Ken Henry. And the latest appointee from among the green faithful, Martin “Mini-me” Parkinson. Previously the head of the government’s new Climate Change department.
So today, I’d like to indulge in a little “Moses” reenactment.
You know … the old Bible story.
The one where Moses smashed in pieces the golden calf that the people had taken to worshipping.
The Treasury department is our modern equivalent. It has become a sacred cow.
I think it is high time we ritually slaughtered this sacred cow. In much the same way as our minority dictatorship has slaughtered Aussie farmers’ cattle export industry.
It seems that we are all expected to (once again) bow and scrape to the Treasury sacred cow, when our dictators tell us that the economic modelling for their new “carbon pricing mechanism” all stacks up.
Yes indeed, we are all expected to accept in blind faith, that the Treasury department’s forecasts and predictions of the financial effects of this great new economic reform bankers’ money-go-round, are solid and sound.
Hmmmm.
Perhaps if Treasury’s forecasts and predictions as prophesied in past budgets can be shown as having been accurate, then we might have some basis, some reason, for placing our faith in them regarding this new carbon dioxide mega-scheme … right?
Well, let’s take a look at them, shall we.
And let’s keep it really simple.
Let’s not slice and dice every line item in their past Budget forecasts. Let’s just see how accurate they were with the two (2) basic, headline Totals.
1. Revenue (ie, income), and
2. Expenses.
Let’s look at the original Budget forecasts that our Treasury gods made in 2007-’08. And especially, let’s note their “forward estimates” made back then, for the following 3 years.
After all, the Government’s “carbon pricing mechanism” plan has an initial 3 year “fixed price period”.
So, if we can see that Treasury got their Budget forecast reasonably accurate for the three years from 2007-’08, then maybe … just maybe … we can have a little confidence in their abilities, and their forecasting accuracy.
Note too, that the 2007-’08 Budget forecasts – prepared by the Ken Henry-led Treasury department – were for the Howard-Costello Government. So we are talking here, about the Treasury sacred cow’s forecasting effort for the so-called “World’s Greatest Treasurer” Peter Costello’s final budget.
Let’s get into it, shall we?
Here’s the original 2007-’08 Budget document, showing “estimates” and “projections” for Revenue:
2007-'08 Budget Paper No. 1, Statement No. 5
Ok.
So, in the May 2007-’08 Budget, Treasury “estimated” Revenue of $246.8 billion for the year 2007-’08.
And they “projected” Revenue of $260.7 billion for the year 2008-’09, and $274.6 billion for 2009-’10.
(Unfortunately, we cannot compare the forecast versus actual Revenue and Expenses for the 4th year (2010-11) of the 2007-’08 forward estimates, because the Final Budget Outcome for that year will not be released until September 2011.)
How well did our Treasury gods do on those “estimates” and “projections” for Revenue?
Let’s take a look.
Here’s the Treasury’s Final Budget Outcome for Revenue in 2007-’08:
2007-'08 Final Budget Outcome - Revenue - Part 1, Table 2
Hmmm. $303.7 billion in actual Revenue, versus the $246.8 billion they “estimated” just 1 year earlier.
An error factor of 23%.
Here’s the Treasury’s Final Budget Outcome for Revenue in 2008-’09:
2008-'09 Final Budget Outcome - Revenue - Part 1, Table 1
Hmmm. $298.9 billion in actual Revenue, versus the $260.7 billion they “projected” just 2 years earlier.
An error factor of 14.6%.
And finally (for Revenue), here’s the Treasury’s Final Budget Outcome for Revenue in 2009-’10:
2009-'10 Final Budget Outcome - Revenue - Part 1, Table 1
Hmmm. $292.8 billion in actual Revenue, versus the $274.6 billion they “projected” just 3 years earlier.
An error factor of 6.6%.
Summary – Revenue.
Treasury’s 2007-’08 Budget “estimates” and “projections” for Revenue in the following 3 years, were wrong by a factor of +23%, +14.6%, and +6.6% respectively.
Or to put it another way, in the 2007-’08 Budget the Ken Henry-led Treasury department underestimated future government revenue by a grand total of $113.3 billion over the first 3 years of their “forward estimates”.
Incredible. They actually received $113.3 billion more than they originally forecast through to EoFY 2010. And yet, these Treasury gods and their Rudd-Gillard-Goose muppets have still managed to plunge Australia into $194 billion in gross debt by mid-2011.
That probably has something to do with their out-of-control spending, right?
Indeed.
Let’s move on to Expenses.
Here’s the original 2007-’08 Budget document, showing “estimated” and “projected” Expenses:
2007-'08 - Budget Paper No. 1, Statement No. 6
Ok.
So, in the May 2007-’08 Budget, Treasury “estimated” Total Expenses of $235.6 billion for the year 2007-’08.
And they “projected” Total Expenses of $247.5 billion for the year 2008-’09, and $259.7 billion for 2009-’10.
How well did our Treasury gods do on those “estimates” and “projections” for Expenses?
Let’s take a look.
Here’s the Treasury’s Final Budget Outcome for Expenses in 2007-’08:
2007-'08 Final Budget Outcome - Expenses - Part 1, Table 3
Oops. $280.1 billion in actual Expenses, versus the $235.6 billion they “estimated” just 1 year earlier.
An error factor of 18.9%.
And don’t forget, ladies and gentlemen … the GFC had not even hit yet! That came 4 months later, in September 2008. Our new PM Kevin07 evidently got off to a treasury-emptying head start, even without a GFC as the excuse.
Here’s the Treasury’s Final Budget Outcome for 2008-’09. This is the year that included the GFC panic, from September ’08 through early 2009:
2008-'09 Final Budget Outcome - Expenses - Part 1, Table 1
Oops. $324.6 billion in actual Expenses, versus the $247.5 billion they “projected” just 2 years earlier.
An error factor of … gulp … 31.1%.
And finally (for Expenses), here’s the Treasury’s Final Budget Outcome for Expenses in 2009-’10:
2009-'10 Final Budget Outcome - Expenses - Part 1, Table 1
Oops. $339.2 billion in actual Expenses, versus the $259.7 billion they “projected” just 3 years earlier.
An error factor of … gulp … 30.6%.
Summary – Expenses.
Treasury’s 2007-’08 Budget “estimates” and “projections” for Expenses in the following 3 years, were wrong by a factor of +18.9%, +31.1%, and +30.6% respectively.
Or to put it another way, in the 2007-’08 Budget the Ken Henry-led Treasury department underestimated future government expenses (ie, spending) by a grand total of $201.1 billion over the first 3 years of their “forward estimates”.
Incredible. These Treasury gods and their Rudd-Gillard-Goose muppets spent$201.1 billion more than they originally forecast through to EoFY 2010.
Here’s another way of looking at the Treasury department’s forecasting genius.
It’s a chart showing the Treasury’s 2007-’08 Budget forecast for Revenue over the following 3 years (blue line), versus the actual Revenue in the Final Budget Outcome for each of those years (green line):
And here’s another chart, showing the Treasury’s 2007-’08 Budget forecast for Expenses over the following 3 years (blue line), versus the actual Expenses in the Final Budget Outcome for each of those years (green line):
It’s interesting to note that Treasury underestimated both Revenue, and Expenses.
Convenient. Very convenient.
After all, most citizens will take more kindly to a government Budget that “forecasts” a total tax take … and total government spending … that are 20% – 30% less than they eventually turn out to be. And the odds of getting caught out are low – how many citizens (or journalists) ever bother to check how close the Treasury/Government’s final budget results came to their original “forward estimates”?
Now, there will doubtless be those who will cry out, “But wait! What about the GFC?! The Treasury forecasts were wrong because of the GFC!”
Indeed.
Our Treasury gods, with all their degrees and PhD’s … did … not … see … the … GFC … coming.
Think about that.
Why would any sane person believe in Treasury’s economic forecasting abilities now … after they totally failed to see that one coming?
We have been documenting these warning signs coming from all over the world – and from here in Australia too – right here on this blog.
If the impact of the GFC is your excuse for the Treasury’s abject failure to get within a bull’s roar of predicting the Budget revenue and expenses for 3 years ahead of time … that they only got it so very, very wrong because they did not see that impact on the Budget coming … then I rest my case.
By your own words … and their own data … they stand condemned.
(And by the words of Macquarie Economic Research too. Click here to see what they had to say about the “truly extraordinary” Treasury modelling underpinning the recent May budget)
UPDATE:
A late thought that just occurred to me.
At precisely the time that Peter Costello was handing down the Treasury department’s 2007-’08 Budget “forward estimates” that we have just examined – in early May 2007 – your humble blogger was commanding his superannuation fund manager (contrary to strenuous “expert” financial advice) to put all his super into cash –
Why?
Because thanks to the clear evidences already coming out of America and elsewhere in the world, even I could see that a GFC was bearing down on us.
The overpaid, tea leaf reading numpties led by former Treasury secretary Ken Henry … could not see it.
UPDATE 2:
Feb 7, 2012
Reader and Twitter follower @Ayeshavit asked me to update this post to capture the Final Budget Outcome for 2010-11 … the last year of the 2007-08 “forward estimates” by the Treasury genii.
Recapping – way back in the (Coalition’s last) May 2007-’08 Budget, Treasury “estimated” Revenue of $287.3 billion for the year 2010-’11.
And they “projected” Expenses of $272.7 billion for the year 2010-’11.
Now, from the 2010-11 Final Budget Outcome, here’s what the Labor government actually achieved in 2011-’11:
Final Budget Outcome 2010-11, Part 1, Table 1
Oops.
$302.0 billion in actual Revenue, versus the $287.3 billion they “projected” just 4 years earlier. An error factor of 5.1%.
And ‘Payments’ (ie, Expenses)?
Double Oops.
$346.1 billion in actual Expenses, versus the $272.7 billion they “projected” just 4 years earlier. An error factor of 27%.
Yup. The Labor Government spent more than one-quarter more money in 2010-’11, than Treasury had “projected” in 2007-’08.
Isn’t it interesting how the Treasury department’s “forward estimates” actually turn out?
What a shame for all Australians, that the lamestream financial and economic commentariat never bother to go back and compare what Treasury originally said, versus the reality of what actually happens.
Instead, sheep-like, they lap up and bleat on to the public whatever nonsense “projections” the Treasury puts out on Budget night … as though it has actually happened.
When as you can see, the Treasury’s “forecasts” are not worth the paper they are printed on.
Media Release – Senator Barnaby Joyce, 11 July 2011:
I thought one-world government was a conspiracy theory, then I heard the de facto deputy PM on Radio National
Well, welcome to the world of a new broad based consumption tax to sit on top of the other green state based taxes and swindles, and of course the GST.
Welcome to the capacity of the government to jack the tax take via your power point, as they please, to pay back their gross debt of $194.4 billion.
Welcome to the fact that the Prime Minister said this is the deal before even a draft of the legislation has made it to the Parliament, another insult to your democratic rights.
Welcome to the Brown-Gillard-Windsor alliance saying this will save the Great Barrier Reef and stop droughts, a pitch that would put the dodgiest second hand car dealer to shame.
Welcome to the world where a member of the new government alliance, Bob Brown, has stated about the carbon price this morning on ABC radio that:
… it’s not locked in for 15 years to no change, this has got upward flexibility. It means that through the processes, including a Climate Change Authority here, we will be able to keep pace with the rest of the world as inevitably more mature and reasoned action is taken against the enormous threat of climate change in the years ahead.
Let’s all just retire from the Parliament as your rights follow your $3 billion of carbon credits, collected via a power point in your home just above the skirting board, to some other corner of the globe. Instead, a new Canberra bureaucracy, or Authority, will decide what the carbon tax should be in the future.
They didn’t need to go to an election to introduce it and now they don’t think they need to go to the Parliament to increase it.
More information– Matthew Canavan 0458 709433
If you’ve not read it yet, then perhaps you’d like to read My Idea to change the world.
How?
By undermining the power of the global bankers … the parasites who screwed us with their GFC, and are behind the huge push for global “air” trading –
In previous articles, I identified the two key details of the Green-Labor Alliance’s proposed “carbon pricing” scheme. The only two details that matter. Because they are the two key details which confirm whether this really is “a tax” / “like a tax”. Or, whether this is just a European ETS-imitating scheme scam:
Will the carbon permits:
(1) have an unlimited expiry date?
(2) be bankable from the commencement of the scheme?
If you’ve not read the previous articles I’ve posted about this – including my online brawl with Opposition Climate Action Onanist Greg Hunt MP about it – then you may wish to recap by reading this, this, and especially, this.
Now, if you just want the quick answers to those 2 key questions, then here’s the 30 second summary. All you need to know. Without bothering to check and understand the detail for yourself.
1. YES, carbon permits will have an unlimited expiry date.
2. NO, carbon permits issued during the “fixed price period” can not be banked. Although there will be unlimited banking after 3 years, when the “flexible price” period begins.
BUT … and (like Gillard’s) it’s a very big but … all “freely allocated” carbon permits can be traded. And – here’s the real biggie, ladies and gentlemen – from Day 1 the Government will allow securitisation of carbon permits (the creation of carbon derivatives, in other words). AND, the Government will set up an “auction” system in advance of the “flexible price period” – an advance-auction system that effectively creates a carbon Futures trading market, allowing banksters (and the lucky 500 “polluters”) to speculategamble on the future price of the “flexible price” permits, that will replace the “fixed price” permits after 3 years.
I was right.
It is NOT a “tax”.
From Day 1, it operates as an ETS by stealth.
It is the bankers’ CPRS by another name.
And what “carbon permits” really means, is “permitted to profit”.
Or perhaps more accurately … A Licence To Print.
Want to know more? To see the proof with your own eyes … and understand it too?
Ok. Let’s get into the details.
Now that GilBrown’s Grand Design has finally been released, let’s take a look at the Government’s freshly-minted cleanenergyfuture.gov.au website. There we can see exactly what they have to say about those two key details that I identified previously.
Note that the answers are buried in the fine print. Naturally. You have to read the Appendices.
In this case, the “devil in the detail” is hidden in Appendix A.
First, let us look for the answer to my point #1 – Will there be unlimited expiry dates for carbon permits?
We find the answer in Appendix A, Table 6 (emphasis added):
Table 6 Compliance
Carbon permits
The domestic unit for compliance with the carbon pricing mechanism will be the ‘carbon permit’.
Each carbon permit will correspond to one tonne of greenhouse gas emissions.
The creation of equitable interests in carbon permits will be permitted, as will taking security over them.
In addition, carbon permits will:
* be personal property;
* be regulated as financial products;
* be transferable (other than those issued under the fixed price or any price ceiling arrangements);
* have a unique identification number and will be marked with the first year in which they can be validly surrendered (‘vintage year’);
* be represented by an electronic entry in Australia’s National Registry of Emissions Units.
I was right.
The carbon permits will have no expiry date.
They are an artificial construct – “an electronic entry” – that is deemed by government decree to be a new “financial product”.
And, they are a personal property right (see first asterisk) of the holder of the permit. Exactly as I argued with that onanist shill for the green cargo cult, Greg Hunt MP.
Moreover, note carefully the sentence I have bold underlined.
The “creation of equitable interests”, and “taking security over them”, simply means this. The carbon permits can be used as the basis for bankers to create other, new financial “securities”.
Carbon derivatives, in other words.
Derivatives (or “securities”) are the toxic, wholly-artificial financial “products” that were at the heart of the GFC. The same bankster-designed “widgets” that the world’s most famous investor, Warren Buffet, spoke of as “a mega-catastrophic risk”, “financial weapons of mass destruction”, and a “time bomb”.
You can stop reading this piece right now if you like.
Because from that Table 6 alone, you now have conclusive proof that this is nothing whatsoever to do with the climate.
It is all – and only – about global bankster profits. At the direct expense of the common people of planet earth.
Now, what about my point #2. The key question of whether there will be unlimited banking of permits.
That is covered in Appendix A as well. But we must take a bit of a journey here, as it’s a little more complicated to get to the bottom of this one.
If you are interested to understand how this scam really works more fully, then do bear with me here (emphasis added):
The carbon pricing mechanism will commence on 1 July 2012. There will be a three year fixed price period.
The fixed price
The carbon price will start at $23.00 per tonne in 2012‑13 and will be $24.15 in 2013‑14 and $25.40 in 2014‑15.
The prices in the second and third year reflect a 2.5 per cent rise in real terms allowing for 2.5 per cent inflation per year (the midpoint of the Reserve Bank of Australia’s target range).
Blah blah blah. We already knew all that. These details were leaked in advance, in typical Green-Labor fashion.
Let’s get to the nitty gritty. The characteristics of the carbon “permits” themselves, and what you can (and cannot) do with them.
Especially during the initial 3 year, so-called “fixed price period”. The period in which the government (and Opposition) have been telling you that this scheme scam “is a tax” or “will operate like a tax” (depending on what day it is):
Fixed price permits
Liable entities will be able to purchase permits from the Government at the fixed price, up to the number of their emissions for the compliance year.
Any permits purchasedat the fixed price will be automatically surrendered and cannot be traded or banked for future use.
Ok.
So, the lucky 500 “polluters” can not trade, or bank, any permits that are purchased at the fixed price.
Now, that appears to eliminate point #2 of those key points that I identified, doesn’t it? The question of unlimited banking of permits.
But does it really?
Hold your horses, dear reader. There’s more to it than that.
Let us peel back the multiple layers of deception.
Yes, permits that are purchased can not be banked.
But what about permits that are handed out for free?
Permits freely allocated may be either surrendered or traded until the true-up date for the compliance year in which they were issued. They cannot be banked for use in a future compliance year.
Right.
So, just like “purchased” permits, “freely allocated” permits also can not be banked during the “fixed price period”. (However, all permits will have unlimited banking after 3 years, when the “flexible price period” begins – see Appendix A, Table 3)
But note this well.
Freely allocated permits can be traded“until the true-up date for the compliance year in which they were issued”.
In other words, with respect to “freely allocated” permits in particular – which will be handed out to “trade exposed” industries rent-seekers – this IS an emissions trading scheme.
Now, did you notice that other little word back there?
“surrendered”?
What happens when “freely allocated” permits are “surrendered”?
Is that just a case of handing back something that you got for free?
Or … is there another profit-making opportunity for our lucky “polluters” there too?
That is, a profit-making opportunity over-and-above the profit-making opportunity they have been granted, to simply jack up their prices and use the “cost” of permits as an excuse – whether they actually paid for all their “permits” or not. Just like the lucky “polluters” have done in the European scheme scam (from Green-Left Weekly May 1, 2011):
So, let’s take a look shall we, and see if there might be yet another profit-making opportunity for our hand-picked lucky 500 “polluters”, on all those “freely allocated” carbon permits (emphasis added):
Buy‑back of freely allocated permits
The holders of freely allocated permits will be able to sell them to the Government from 1 September of the compliance year in which they were issued until 1 February of the following compliance year.
Got that?
You get some-thing for nothing.
You increase your costs to customers, using the government-decreed “price” of that “some-thing” as your excuse – a windfall profit.
And then, you either trade that free “some-thing” to someone else, or, you sell it back to the government – for another windfall profit.
Brilliant!
Now that’s what I would call “transitional assistance” too, if I were one of those lucky 500 “big polluters”.
Money for nothing.
How much will you get paid for selling back your free permits … you lucky big “polluter” you?
The price paid by the Government will be equal to the price of the fixed price permits for that year, discounted to 15 June of the compliance year by the latest available Reserve Bank of Australia index of the BBB corporate bond rate, so that the buy‑back price reflects the present market value of the permit.
From 15 June onwards, the price paid will be equal to the fixed‑price permits for that vintage.
What does that mean?
It’s very simple.
Those lucky “polluters” receiving “freely allocated” permits (to profit), can either:
(a) trade them (as we saw earlier), OR
(b) sell them back (ie, “surrender” them) to the Government.
If they can’t pull a big enough profit from trading their free permits … the fall-back plan is to resell them to the Government.
Now, who do you think is going to benefit the most from all the transactions of these carbon permits?
Who is going to make money for nothing via fees and commissions, each time a “freely allocated” permit is traded, or bought from/sold back to the government?
Banksters.
The same despicable scum, the parasites who created the GFC, and have been driving the global push for CO2 emissions trading from Day 1.
Our government’s scheme scam will achieve exactly the same result as the benchmark European ETS.
Huge profits for a few.
Raped wallets for the many.
And absolutely bugger-all impact on global CO2 “emissions reduction” –
Want more?
There IS more.
Is there anything interesting to note about the subsequent “Flexible Price Architecture” (ETS)?
That wonderful “market-based” scheme scam that comes after the so-called “fixed price period” (in which trading of freely allocated permits can happen anyway, meaning it is an ETS from Day 1)?
Is there anything about the detail of the “flexible price architecture” that might give us further evidence – if any were needed – that this really is the bankers’ CPRS by another name?
Indeed there is.
Take a look at Appendix A, Table 3 (emphasis added):
Table 3: Flexible price architecture
Price ceiling
A price ceiling will apply for the first three years of the flexible price period.
The price ceiling will be set in regulations by 31 May 2014 at $20 above the expected international price for 2015‑16 and will rise by 5 per cent in real terms each year.
If the world is on a 450 parts per million carbon dioxide equivalent (CO2-e) trajectory or higher, this will be reflected in international prices and the price ceiling will automatically be $20 above this price. The level of the international price will be examined closer to the point of transition to a flexible price period to ensure that the price ceiling reflects a $20 margin above its expected level.
In other words, our Green-Labor Alliance would (if still in power) not only allow, but indeed, “ensure”, that the CO2 price in Australia could be traded at a $20 per tonne premium to the international price.
Because this detail tells us that this is a scam whereby the government will “ensure” that there is “flexibility” for the banksters’ – market manipulators extraordinaire – to use the many dodgy means at their disposal to push the Australian CO2 trading price up, by as much as $20 more than the international market price.
In other words, if the international market price for CO2 permits (again) fell to near-zero – let’s say, $0.10 – then our Green-Labor Alliance would still happily allow our nation to suffer under a $20.10 price for CO2 permits, and the flow-on effects of that to the prices on everything.
Insanity.
But there’s more:
Price floor
A price floor will apply for the first three years of the flexible price period.
The price floor will start at $15 and rise at 4 per cent in real terms each year.
Also highly significant.
And insane.
If still in power, our Green-Labor Alliance would force the so-called “free market” price to be at least $15 per tonne. And, they would force that price to rise at a rate of 4% per annum.
Ummmmm … hello?!
That’s NOT a “free market” mechanism.
That is quite simply, a Communist-style command-economy. Wearing a very thin veil of “free market” respectability (if you’re idiot enough to believe it, that is).
But here’s the part I really love, dear reader.
The part that – once again – confirms that this is a bankers’ CPRS by another name.
Banking and borrowing
Unlimited banking of permits will be allowed in the flexible price period.
There will be limited borrowing of permits such that, in any particular compliance year, a liable entity can surrender permits from the following vintage year to discharge up to 5 per cent of their liability.
Auctions of permits
Permits will be allocated by auctioning, taking into account transitional assistance provisions for key sectors.
The policies, procedures and rules for auctioning will be set out in a legislative instrument.
The Government will advance auction future vintage permits. There will be advance auctions of flexible price permits in the fixed price period.
Note that bit about “transitional assistance provisions” for “key sectors”. That’s Orwellian doublespeak for “freely allocated permits” for “big ‘polluters’ with the best lobbyists”.
If you are a “polluter” in need of “transitional assistance” – meaning, everyone – then you will get lots and lots of freely-allocated permits. To help you “transition” (wink wink, nudge nudge).
Now, why have I bold underlined “borrowing“?
And why have I bold underlined “advance auctions of flexible price permits…”?
Because these are the key words from the “banking and borrowing” section. The words that tell you all you need to know.
That this SCAM is nothing whatsoever to do with the global climate.
And that it is 100% about creating a new, global, CO2 derivatives-trading market for the banksters.
The world’s biggest-ever financial cesspool.
Of toxic, intrinsically-worthless, humanity-raping financial “instruments” called derivatives.
Non-existent, digital “widgets”.
That can be borrowed from the future – ie, before these artificial carbon “widgets” are even issued – and leveraged by scum-of-the-earth banksters.
And then, traded by these parasites at multiples of hundreds and thousands of times more than the underlying, artificially-created “value” of the carbon permit.
Furthermore, the “advance auctions of flexible price permits in the fixed price period” proves beyond all shadow of doubt, that I was right.
That this “carbon pricing mechanism” is the bankers’ CPRS by another name. From Day 1.
Why does it prove it?
The advance auctions of flexible price permits “in the fixed price period” means this.
From Day 1, the government is effectively allowing the setting up of a futures trading market, for Australian CO2 permits.
Futures trading of nothing. Before the nothing is even created.
The banksters’ wet dream.
Australia – you have been monumentally conned.
The Green-Labor-Independent Alliance’s plan to “save the planet”, is a gigantic scam.
It is the bankers’ Casino Royale.
Where “carbon permits” really means, “A Licence to Print”.
UPDATE:
Stock broker and licensed securities and derivatives dealer Andy Semple recognises the same point that I did above – that this is not a “free market” mechanism at all, but a Soviet-style command-and-control scheme. He has deconstructed the Government’s carbon trading scam, from a trader’s perspective. A must read –
An independent carbon bank, similar to the Reserve Bank, should be set up to oversee a carbon price and investment in clean technology, the peak renewable energy lobby says.
The Clean Energy Council will today release a discussion paper proposing the carbon bank, which it says could be allowed to borrow money to invest in renewable energy projects against the future revenue of Labor’s proposed carbon tax and emissions trading scheme.
Hmmmmm.
An “independent” carbon bank.
Trading in … what you breathe out.
Borrowing … and “investing” … against the future government tax revenue.
In other words, the government … meaning taxpayers … the guarantor for any losses on those “investments”.
And derivatives, well, they’re safe-as-houses too.
After all, the mortgage-backed derivatives market that blew up America is only a tiddling little market.
So there’s clearly no cause for concern about yet another bankster-driven scheme, to blow up a global, air-backed derivatives bubble:
To give an idea of the vast disconnect between our banks’ “Assets” (66% of which are loans), and their exposure to OTC derivatives, the following chart shows their total Assets – blue line – versus a red line of total Off-Balance Sheet “business” (click to enlarge):
$2.66 Trillion in "Assets" versus $15 Trillion in Off-Balance Sheet "Business"
They say that the main gimmick used to promote Hubba Bubba is that it is less sticky than other brands of bubble gum, and so burst bubbles are easier to peel from your skin.
No worries then.
Sure, we are going to get squeezed dry.
But there’ll be no needing to go shave our heads or rend our clothes when the biggest bubble ever goes POP!
Media Release – Senator Barnaby Joyce, 1 March 2010
On the weekend I was flattered by Mr Rudd making a statement about myself and risk. I heard the statement whilst driving from a major protest in Armidale about the decision to bring in beef from countries with mad cow disease, which I think is very risky and so do most Australian consumers.
Whilst driving there was blanket coverage on the radio about Mr Rudd’s insulation program, a program responsible for the deaths of four young men, a program which has burnt down approximately one hundred houses and created deaths traps in about another 1000. According to James Tinsley from the National Electrical and Communications Association it could cost tax payers almost half a billion dollars to fix.
Yesterday I heard Mr Rudd asked about fixing the health system and he said, “We didn’t anticipate how hard it was going to be to deliver things.” Now he wants us to give him more time to do a proper job on it. Let us not forget that Mr Rudd continues to pursue the Emissions Trading Scheme. This is where he reconfigures the whole of the nation’s economy based on a colourless, odourless gas while taxing every Australian household at the power points in their rooms. This is on the belief that Minister Wong can single handedly change the temperature of the globe from her room in Canberra.
Surely Mr Rudd can see the paradox of his statements on risk and national management. I’ll have to inform Mr Rudd, that as I drive around the country I am told constantly about the parody that his government is becoming. I think the best summation of the Labor Government was given by two people, a worker in a mine talking about discussions with his union colleagues and a service station operator. The first one said we just do not understand anything Mr Rudd says and we are very concerned about our jobs and his position on the ETS. The service station operator said people just start laughing when they see Mr Rudd now.
That, Mr Rudd is the fair dinkum reality. It is like the mechanic who, asked to service your car has done nothing to it except mount up a huge bill. After a couple of years bits and pieces of the vehicle are strewn around the shed and now Mr Rudd rushes out the front to talk to you with his little note book and says, I know I’ve stuffed up but I just want you to give me a couple more years to do a proper job on this.
"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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