Tag Archives: IMF

IMF Calls For 10% “Tax” On All EU Households With “Positive Wealth”

20 Oct
Click to enlarge

Click to enlarge

Still on hiatus, but had to share this.

From the International Monetary Fund (IMF) October 2013 Fiscal Monitor: Taxing Times, page 49 (my bold added):

Box 6. A One-Off Capital Levy?

The sharp deterioration of the public finances in many countries has revived interest in a “capital levy”— a one-off tax on private wealth—as an exceptional measure to restore debt sustainability. The appeal is that such a tax, if it is implemented before avoidance is possible and there is a belief that it will never be repeated, does not distort behavior (and may be seen by some as fair) …

Yes, no doubt “some” of those who have enjoyed the benefits of debt-financed “prosperity” would see a raid on households with real savings as “fair”.

… There is a surprisingly large amount of experience to draw on, as such levies were widely adopted in Europe after World War I and in Germany and Japan after World War II…

We’ve done it before. Why not do it again?

… Reviewed in Eichengreen (1990), this experience suggests that more notable than any loss of credibility was a simple failure to achieve debt reduction, largely because the delay in introduction gave space for extensive avoidance and capital flight

Hurry up. Take the prudent savers’ money, before they find out what we’re planning.

… The tax rates needed to bring down public debt to precrisis levels, moreover, are sizable: reducing debt ratios to end-2007 levels would require (for a sample of 15 euro area countries) a tax rate of about 10 percent on households with positive net wealth.

And there are still some — usually those pillorying excessive private debt — who argue that the level of public debt does not matter.

Some excellent commentary on this IMF document from John Ward at The Slog here.

In other news, it appears the USA has begun to introduce capital controls. From Sovereign Man, October 16:

The path to tyranny is almost always paved with good intentions.

And so, enter stage left, the innocuously named Consumer Financial Protection Bureau (CFPB).

These government agencies with the catchy, high-sounding names are always the most dangerous. After all, it was the ‘Committee for Public Safety’ that was responsible for wanton genocide during the post revolution Reign of Terror in France.

Recently, the CFPB ‘encouraged’ retail banks in the Land of the Free to ‘help’ their customers regarding international wire transfers. And by ‘help’, they mean prohibit.

Of course it’s all for ‘consumer protection’.. So under the guise of safety and security, several banks will curtail retail customers’ abilities to send international wire transfers.

Chase, for example, will start to limit cash withdrawals and ban business customers from sending international wire transfers from November 17 onward.

And starting October 20th, HSBC USA’s Premier clients will have to wait a minimum of five days before transferring funds to their OWN international accounts!

This is the very nature of capital controls– restricting the free flow of capital across borders until it is trapped inside the country and forcibly denominated in a rapidly devaluing currency.

Moral of the above: If your government knows you have it, they will take it.

IMF Admits Usury Is The Root Problem Of The Global Financial System

6 Sep


There is much of interest in the IMF’s Financial System Stability Assessment of Australia, published in November 2012.  The following line in particular caught my eye, and is worthy of comment. The context is the IMF’s consideration of what are the “key risks” to our banking system (page 10-11):

Pressure on the net interest margin, which accounts for almost two-thirds of operating income, has the potential to encourage more risk-taking by banks in order to preserve profitability.

Thoughtful readers will observe that this statement unintentionally lends direct support to a fundamental argument your humble blogger has made — that usury is the root problem of the global monetary system, and that fractional reserve banking (or endogenous money creation) is only a secondary problem.

Consider again the conclusion to my recent post, IMF Economist Says Banks’ Key Function Is To CREATE Money:

As we have oft-repeated here at barnabyisright.com, while this power to “create money” ex nihilo (out of nothing) is a key problem, it is not THE root problem.

The power to create “money” (in the form of debt) out of nothing, simply gives banks leverage.

What they leverage, is Usury.

The “net interest income” — that is, the difference (or “spread” or “margin”) between the interest % they give on deposits, and the interest % they take on loans — is the heart of the banks’ profit (and power) business model.

The power to create more and more money (“credit”), simply allows them to magnify (or leverage) their “returns” (profits) on that difference between usury paid, and usury taken.

It deeply saddens your humble blogger that there are so many highly intelligent (far moreso than I), sincere, well-meaning, altruistic men and women in the world who are keenly interested in reforming the financial system for the betterment of humanity … and yet, almost none have yet recognised that usury is the root problem.

The IMF has directly admitted that the root of banks’ profit-making model is net interest income, and that pressure on the “margin” between what they charge in interest for loans, and must offer in interest on deposits, “has the potential to encourage more risk-taking by banks in order to preserve profitability”.

What exactly is meant by “more risk-taking”?

In the footnote (3) to the IMF’s comment, we are told that:

“Riskier activities could include, for example, loosening underwriting standards or expanding too quickly into new business or geographic regions.”

In other words, making it easier for more people to borrow more debt.

Using the leverage of increased fractional reserve / endogenous money creation.

Barnaby Is Right … is right.

See also:

Looking For A Root

A Tale Of Usury, Explosions, And A Used Car Salesman

A History Of The Legal Case Against Usury

An Historical Warning For Proponents Of A Modern Debt Jubilee

Treasury Ignores Housing Sector In Structural Budget Comparison With Ireland

6 Aug


The Australian Treasury’s recent update to its working paper Estimating The Structural Budget Balance Of The Australian Government, makes for interesting reading.

Interesting, in that it provides all the reason needed to put a broom through the entire department.

Why so?

Treasury points to an analysis which shows that the IMF has repeatedly over-estimated Ireland’s true structural budget position, and calls it a “cautionary tale” for Australia:

Box 2: Ireland’s structural budget balance

Changing estimates of Ireland’s structural budget balance provide a cautionary tale, highlighting the difficulty of estimating structural budget balances in real time.

Since the onset of the GFC, the IMF’s estimates of Ireland’s pre-crisis structural budget balance have been revised down significantly. While the IMF initially estimated that Ireland had been close to structural budget balance in 2007, its latest (April 2013) estimate now suggests a structural deficit of around 8½ per cent of potential GDP in 2007 (Chart A).

Australian Treasury, "Estimate The Structural Budget Balance", May 2013, page 10

Australian Treasury, “Estimating The Structural Budget Balance Of The Australian Government”, May 2013, page 10

The authors then promptly ignore the striking similarities between Australia’s structural position now, and Ireland’s pre-GFC:

While part of the revision to the IMF’s pre-crisis estimates of the structural budget balance is due to a lower estimate of potential GDP, the main reason for the change is that these estimates failed to capture the dependence of the fiscal position on an unsustainable boom in the housing sector (Kanda 2010). With residential investment and house prices soaring, property-based taxes grew at a pace well above GDP growth. Failure to recognise at the time that the bulk of these revenues were cyclical led to significant tax cuts and expenditure increases, which created a large structural hole in Ireland’s public finances.

Alas, the ivory-towered Treasury wonks fail to see that this is not just Ireland … this is Australia they are talking about.

They are too busy obsessing over the process of estimating the structural budget balance, to notice the stark similarity in what has actually happened out here in the real economy.

Indeed, it is clear from the paragraph preceding all of this, that the only lesson they have learned from the “international experience”, is not to over-rely on “point estimates” in making their calculations:

The key point to draw from the analysis is not the specific year in which the [Australian] budget returns to structural surplus, but the steady improvement over time. Indeed, international experience has illustrated the difficulties in disentangling temporary and permanent economic influences on the budget, which cautions against overreliance on point estimates of the structural budget balance (see Box 2).

Australian Treasury, Estimating The Structural Budget Balance, May 2013, page 9

Australian Treasury, “Estimating The Structural Budget Balance Of The Australian Government”, May 2013, page 9

Australian Treasury, "Estimating The Structural Budget Balance For Australia", May 2013, page 10

Australian Treasury, “Estimating The Structural Budget Balance For Australia”, May 2013, Box 2, page 10

Er … no.

The “international experience” does not caution against “overreliance on point estimates”.

It cautions against allowing “an unsustainable boom in the housing sector … with residential investment and house prices soaring”.

It cautions against government fiscal policy that relies on “property-based taxes” growing “at a pace well above GDP growth”.

It cautions against “failing to recognise at the time that the bulk of these revenues were cyclical”.

It cautions against “significant tax cuts and expenditure increases” creating “a large structural hole in Australia’s public finances”.

It also cautions against something else.

Allowing technical wonks, with no real world business experience, no commonsense, and no wisdom, to be employed in what is arguably the most important department in the Australian Government.

Is it any surprise that Treasury cannot get any of its budget estimates and projections within a bulls roar of reality?

Their over-educated eggheads cannot see the forest for the trees.

Here is another striking similarity with Ireland, that Treasury doubtless has not noticed either.

When you add the public debt of Australia’s state governments to the federal government debt, Australia’s total public debt position is now worse than Ireland pre-GFC:

Screen shot 2013-08-05 at 7.39.04 PM

Screen shot 2013-08-05 at 7.37.30 PM

And with Australia’s banking system being the most exposed to residential mortgages in the world…


… now you know why Moody’s has warned of an Australian banking system collapse:

The continued strong expansion in real estate loans—at least relative to other lending segments—has raised some eyebrows. The Australian banking sector has the highest exposure to residential mortgages in the world… The high degree of exposure to the domestic mortgage market raises many concerns. Recent experience has shown that house prices can fall significantly and trigger serious banking meltdowns. But what are the chances of a similar housing collapse in Australia? Many international analysts think the chances of an antipodean housing bust are quite high—it would take a bold economist who has been in a decade-long coma to declare that an Australian housing correction was impossible. When trends in Australian house prices are compared globally, the signs look worrying. House prices have increased for longer and faster than in many of the markets where prices cratered during the Great Recession.

With even our panglossian Labor government now predicting rising unemployment, does all this sound rather like Ireland to you?

Can you see the forest … or only the trees?

See also:

Australia Plans Cyprus-Style Bail-In Of Banks In 2013-14 Budget

Australian Banks “Welcome” Cyprus-Style Bail-In Plan

IMF Tells Australian Lawmakers To “Prevent Premature Disclosure Of Sensitive Information” On Bank Bail-Ins

Government’s Hand To Dip Right Into Your Bank Account

1 Aug


No surprises here for regular readers.

From today’s Australian Financial Review:

The federal government will prop up the budget bottom line with a new levy on banks that will be badged as providing insurance in case future bailouts are needed.

The Australian Financial Review has learned that the government’s economic statement, set to be released Friday, will contain a deposit insurance levy as recommended by the Council of Financial Regulators, which will raise funds to underwrite any Australian bank should it need assistance in the future.

The proposed levy would be between 0.05 per cent and 0.1 per cent. Presently, the government guarantees deposits up to $250,000 without charging the banks.

Actually, the AFR has it wrong. Or at least, incomplete.

Yes, the Council of Financial Regulators may have “recommended” this.

But the real shot-callers, are the banksters at the IMF and the Financial Stability Board.

Recently, we saw that the IMF criticised the 2007 Rudd Government’s deposits guarantee scheme, introduced in a panic in response to the GFC. They said that, because of the “extreme concentration” in the Australian banking system, the Rudd scheme “increased moral hazard greatly”:

Australia: Financial Safety Net and Crisis Management Framework. Source: IMF (click to enlarge)

Australia: Financial Safety Net and Crisis Management Framework. Source: IMF (click to enlarge)

The IMF’s suggested solution to this “moral hazard” problem, was to make the banks pay “premiums” towards a “reserve fund” that could be used to support payouts under a depositor guarantee.

However, the IMF also noted that even if a requirement for premium contributions was established, Australia’s banking system is so highly concentrated that “it may be difficult to establish a fund of sufficient size that the deposit guarantee would seem credible” –

Click to enlarge

Click to enlarge

So what we have now, is the Rudd Government doing what the IMF says — introducing a “premium” levy on the banks — to (supposedly) establish a “reserve fund” for the deposits guarantee scheme.

But according to the AFR’s “source”, what the ALP will actually use this fee for, is to fill some of their ever-growing budget black hole:

A senior source said the levy would build up funds “over time” and would take several years to reach the billions. He said it would raise less than $1 billion over the forward estimates but build over the outer years.

The revenue raised by the levy will also be added to the budget bottom line, helping the government offset a forecast plunge in revenues since the May budget and meet its target of returning to surplus in 2016-17.

“It won’t fix the surplus problem in itself but it will help,’’ the source said.

The source said while the money collected would count as revenue, should the fund ever be drawn upon it would count as expenditure.

What we have here, then, is a supposed “fix” to the deposits guarantee scheme.

A “fix” that even the IMF says is not “credible”, because of the “extreme concentration” in our banking sector.

A “fix” that means the banks will now take more money off you (fees), to pay the new levy.

A “fix” that the government will really use for political purposes — to make its ever-deteriorating budget numbers look better.

How long will it be until we get our first bank bail-in, I wonder?

Related info here:

IMF Says Rudd’s Depositor Guarantee Scheme “Increases Moral Hazard Greatly”

Australia Plans Cyprus-Style Bail-In Of Banks In 2013-14 Budget

G20 Governments All Agreed To Cyprus-Style Theft Of Bank Deposits… In 2010

IMF Tells Australian Lawmakers To “Prevent Premature Disclosure Of Sensitive Information” On Bank Bail-Ins

Moodys Warns Of Australian Banking Collapse



As I was saying (a week ago). This from the ABC –

Finance Minister Penny Wong would not comment on the reports but says a levy is something the Government has been looking into.

The IMF and the RBA have put a view to the Government for a need for a fund to cover deposit protection,” she said.

Treasurer Chris Bowen is meeting with representatives from the Australian Banking Association in Sydney this afternoon to further consult on a possible deposit-protection levy.

Mr Bowen pointed to a report from the International Monetary Fund (IMF) which he says highlights a gap in Australia’s public policy when it comes to “provisioning for any potential bank or deposit-taking institution failure”.

As expected.

The government will point to the IMF’s report, as justification for their action.

Conveniently neglecting to mention, of course, that the IMF also indicated that the real problem is the “extreme concentration” in our banking sector, and because of that, establishing a reserve fund is not a credible solution to the problem of convincing depositors (ie, deceiving them into believing) that their deposits are protected.


Reports that the “levy” will raise $733 million; banks to pass on the cost to customers; the money supposedly “quarantined” but the government will add the number to its Budget bottom line anyway, “for accounting purposes” (from the Guardian):

A new levy on Australia’s banks will raise $733m, adding to a tobacco tax rise worth $5.3bn to be unveiled in the Rudd government’s looming economic statement.

The government will create a financial stability fund recommended by the International Monetary Fund, the Reserve Bank of Australia and the Council of Financial Regulators, paid for by the levy on the banks.

The fund is designed as insurance in the event that a big Australian bank requires a bailout owing to global instability.

Er … owing to “global” instability?

We’ve plenty of internal instability to worry about. Just ask Moodys ratings agency.

The levy will be collected by the banking regulator, the Australian Prudential Regulation Authority, and deposited into a fund administered by a government agency. The money will be quarantined but, for accounting purposes, will go to the bottom line. The measure will help the government meet its surplus target for 2016-17.

The levy is not expected to take effect until January 2016. The government envisages imposing a notional 5 basis points levy on deposits of up to $250,000 for each account holder at every bank, mutual bank or credit union.

Banks are expected to pass the cost of the levy to their customers.

Which just goes to prove what a complete, total deceit a government budget really is.

A mass of shoddy “forecasts” and “projections”, cunning “revisions” and dishonest accounting tricks, all designed to make the government of the day look good .. for one day .. in May .. when they announce it.

IMF Says Rudd’s Depositor Guarantee Scheme “Increases Moral Hazard Greatly”

25 Jul

It’s yet another Rudd Labor disaster, just waiting to happen.

According to the IMF’s November 2012 technical note, Australia: Financial Safety Net and Crisis Management Framework, page 26, not only is there an “extreme concentration” in our banking system; the Financial Claims Scheme (FCS) introduced by the Rudd Government in 2008 “increases moral hazard greatly” –

Australia: Financial Safety Net and Crisis Management Framework. Source: IMF (click to enlarge)

Australia: Financial Safety Net and Crisis Management Framework. Source: IMF (click to enlarge)

Why so?

The IMF says that, unlike “most” similar schemes elsewhere, the Rudd scheme does not require the banks to make any contributions towards pre-funding of the guarantee. The responsibility for funding it, falls on the government. Meaning, the taxpayer.

Indeed, the IMF points out that the government may need to increase the public debt limit above the present $300 billion ceiling, if payouts under the scheme became necessary –

Click to enlarge

Click to enlarge

The IMF’s suggested solution to this “moral hazard” problem, is to make the banks pay “premiums” towards a “reserve fund” that could be used to support payouts under a depositor guarantee. However, the IMF also notes that even if a requirement for premium contributions was established, Australia’s banking system is so highly concentrated that “it may be difficult to establish a fund of sufficient size that the deposit guarantee would seem credible”

Click to enlarge

Click to enlarge

When you pause to carefully think this through, merely forcing the banks to pay a premium contribution towards a depositor claims reserve fund is really a rather ridiculous non-solution to the highlighted problem of moral hazard. It is analogous to charging an insurance premium for a policy that promises to pay for the ticket if the banker gets caught speeding –


We have recently seen the evidence in the Portfolio Budget Statements (page 134) for Budget 2013-14 that the government is now well-advanced in preparations for a Cyprus-style “bail-in” of our banks.

We have also seen the recent warning by Moodys ratings agency that our banking system has the world’s highest exposure to mortgages, and so is vulnerable to collapse if house prices fall.

Combine this with the IMF’s warning about Rudd Labor’s rushed and bungled depositor guarantee scheme that “increases moral hazard greatly”, and it is increasingly clear that I will soon have to redraft the debt trajectory chart on the masthead of this blog.

It only goes up to $300 billion.

See also:

The Bank Deposits Guarantee Is No Guarantee At All

Warning Of Global Systemic Crisis 2.0 In Second Half 2013

20 Jul


There are many who take careful notice of the GlobalEurope Anticipation Bulletin (GEAB). I too, have often found it interesting, and insightful.

The latest GEAB is certainly worth reading, and heeding. But not for the obvious, headline reason.

It may be flagging in advance a “reform” agenda, to be triggered as a response to a new, bigger crisis. A reform that some, including myself, have long expected (excerpt-only below):

A situation which is now out of control

The illusions which have still blinded the last remaining optimists are in the process of dissipating. In previous GEAB issues we have already laid out the world economy’s grim picture. Since then the situation has got worse. The Chinese economy confirms its slowdown (1) as well as Australia (2), emerging countries’ currencies are disconnecting (3), bond interest rates are rising, UK salaries are continuing to fall (4), riots are affecting Turkey and even peaceful Sweden (5), the Eurozone is still in recession (6), the news filtering out of the United States is no longer cheerful (7)…

Nervousness is now clearly palpable on all financial markets where the question is no longer knowing when the next record will be but succeeding in getting out soon enough before the stampede. The Nikkei has fallen more than 20% in three weeks during which there have been three sessions with losses exceeding 5%. So, the contagion has now reached the “standard” indices such as the stock exchanges, interest rates, and currency exchange rates… the last bastions still controlled by the central banks and, therefore, totally distorted as our team has repeatedly explained.

In Japan this situation is the result of the over-the-top sized quantitative easing programme undertaken by the central bank. The Yen’s fall has brought about strong inflation in the price of imported goods (particularly oil). The huge swings in the Japanese stock exchange and currency is destabilising the whole of global finance. But the implementation of the Bank of Japan’s programme is so new that its effects are still much less pronounced than those of the Fed’s quantitative easing. It’s primarily the Fed which is responsible for all the current bubbles: real estate in the United States (8), stock exchange record highs, bubbles in and destabilisation of emerging countries (9), etc.

It’s also thanks to it, or rather because of it, that the virtual economy has got going again with even greater intensity and that the necessary balancing hasn’t taken place. The same methods are producing the same effects (10), an increased virtualisation of the economy is leading us to a second crisis in five years, for which the United States is once again responsible. The central banks can’t hold the global economy together indefinitely; at the moment they are losing control.

A second US crisis

If the months of April-May, with a great deal of media hype, seem to agree with the US-UK-Japanese method of monetary easing (to put it mildly) against the Euroland method of reasoned austerity, for several weeks now the champions of all-finance have had a little more difficulty in claiming victory. The IMF, terrified by the global impact of the economic slowdown in Europe, doesn’t know what else to come up with to force Europeans to continue spending and make deficits explode again: even empty boutique World must continue to give the impression that it’s still in business, and Europe isn’t playing the game.

But the toxic effects of central bank operations in Japan, the United States and the United Kingdom now demolish the argument (or rather propaganda) touting the success of the “other method”, supposed to allow recovery in Japan, the US and the United Kingdom (incidentally, the latter has never even been mentioned).

The currently developing second crisis could have been avoided if the world had taken note that the United States, structurally incapable of reforming itself, was unable to implement other methods than those which had led to the 2008 crisis. Like the irresponsible “too big to fail” banks, the “systemically” irresponsible countries should have been placed under supervision from 2009 as suggested from the GEAB n° 28 (October 2008). Unfortunately the institutions of global governance have proved to be completely ineffective and powerless in managing the crisis. Only regional good sense has been able to put it in place; the international arena producing nothing, everyone began to settle their problems in their part of the world.

The other crucial reform advocated (11) since 2009 by the LEAP/E2020 team focused on taking a completely new look at the international monetary system. In 40 years of US trade imbalances and the volatility of its currency, the dollar as the pillar of the international monetary system has been the carrier of all the United States’ colds to the rest of the world, and this destabilising pillar is now at the heart of the global problem because the United States is no longer suffering from a cold but bubonic plague.

Absent having reformed the international monetary system in 2009, a second crisis is coming. With it comes a new window of opportunity to reform the international monetary system at the G20 in September (12) and one almost hopes that the shock happens by then to force an agreement on this subject, otherwise the summit risks taking place too soon to gain everyone’s support.


(1) Source: The New York Times, 08/06/2013.

(2) Source: The Sydney Morning Herald, 05/06/2013. Read also Mish’s Global Economic, 10/06/2013.

(3) Source: CNBC, 12/06/2013.

(4) Source: The Guardian, 12/06/2013.

(5) Read Sweden’s riots, a blazing surprise, The Economist, 01/06/2013.

(6) Source: BBC News, 06/06/2013.

(7) Read Economic dominos falling one by one, MarketWatch, 12/06/2013.

(8) A bubble in current market conditions; normally this would be considered a thrill. Market Oracle, 10/06/2013.

(9) On the consequences of worldwide QE in India: Reuters, 13/06/2013.

(10) The return of financial products at the origin of the 2008 crisis is not insignificant. Source : Le Monde, 11/06/2013.

(11) Cf. GEAB n°29, November 2008.

(12) Source: Ria Novosti, 14/06/2013.


September 2013.

That would be convenient timing.

Since we have now seen the irrefutable evidence that, as agreed at Seoul in 2010, the G20 nations — in particular, the EU, UK, USA, Canada, Australia, and New Zealand — are all now well advanced in their preparations to implement a Cyprus-style “bail-in” of banks.

See Timeline For “Bail-In” Of G20 Banking System.

I’ve said it before, and will again.

Any “new” monetary system that is suggested by the usual suspects — the internationalist IMF, World Bank, FSB, etc, which are all little more than elitist bankster covens — is NOT the new monetary system we should want.

Because it would only ever be, as now, their system. Of their design. For their benefit.

What the world needs is something very different to anything that the bankers would ever promote –

Imagine A World With No Banks

“Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.”

– Napoleon, 1815

IMF Tells Australian Lawmakers To “Prevent Premature Disclosure Of Sensitive Information” On Bank Bail-Ins

17 Jul


IMF: Financial Safety Net and Crisis Management Framework, November 2012, page 4 (click to enlarge)

IMF: Financial Safety Net and Crisis Management Framework, November 2012, page 4 (click to enlarge)

IMF: Financial Safety Net and Crisis Management Framework, November 2012, page 5 (click to enlarge)

IMF: Financial Safety Net and Crisis Management Framework, November 2012, page 5 (click to enlarge)


Orwell would be impressed with this.

In a November 2012 Technical Note on the Financial Sector Program Update for Australia, as part of their Financial Safety Net and Crisis Management Framework, the IMF has advised that there is a problem (my bold emphasis added):

Past simulation exercises revealed the need for legislative changes to prevent premature disclosure of sensitive information. Australia’s securities disclosure regime requires, for the protection of investors, immediate and continuous disclosure of information that could reasonably be expected to have a material effect on the price or value of an ADI’s securities. There is a high probability that any resolution or crisis response measures will impact the price or value of an authorized deposit-taking institution’s (ADI’s) securities.

Poor coordination of compliance with the disclosure requirements, timing of resolution or crisis response actions, and the overall public communication strategy regarding these actions could pose risks to financial stability (e.g., through depositor runs) or thwart resolution actions (e.g., through the stripping of the ADI’s assets by insiders) or cause market disruptions. Legislative changes that reduce tension between investor protection and financial stability should be pursued.

“Reduce tension” between investor protection and financial stability?!

By making laws to “prevent premature disclosure of sensitive information”?!?!

In order to prevent bank runs, which would happen if investors were to find out that a Cyprus-style “resolution or crisis response measure” is in the offing for the bank that they have their money in?!?!!!!

Truly, moral relativism is one of The greatest evils of our time.

These people have no Conscience.



The Treasury department put this problem to the banks in their September 2012 Consultation Paper, with a proposal to suspend the continuous disclosure requirements:

Australian Treasury, Strengthening APRA’s Crisis Management Powers, September 2012, page 26 (click to enlarge)

Australian Treasury, Strengthening APRA’s Crisis Management Powers, September 2012, page 26 (click to enlarge)

Australian Treasury, Strengthening APRA's Crisis Management Powers, September 2012, page 29 (click to enlarge)

Australian Treasury, Strengthening APRA’s Crisis Management Powers, September 2012, page 29 (click to enlarge)

… and unsurprisingly, the banks have agreed to it:

AFMA, letter to Australian Treasury, January 2013, pp 7-8 (click to enlarge)

AFMA, letter to Australian Treasury, January 2013, pp 7-8 (click to enlarge)

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