Tag Archives: mining boom

Labor’s Economic Plan: Copy Cyprus And Iceland

19 Jul

Airplane-wreckage-Iceland1

Your humble blogger was interested to watch new treasurer Chris Bowen’s speech at the National Press Club yesterday.

Readers may have noticed that resuscitated PM Rudd has immediately distanced his own economic narrative from that of former PM Gillard, and her imbecilic deputy PM and “World’s Greatest Treasurer” Swan. Rather than their mantra-like “Strongest advanced economy / mining boom forever / everything is fine / stop being so negative” tripe, Kevin Rudd has instead begun to offer the teensiest bit of honesty about the problems the economy faces, both now, and in the weeks and months ahead.

So in that vein, I wondered whether our new treasurer might just put a little bit more meat on the bone of Rudd’s rhetoric, by outlining (or even hinting at) just what this “new Labor” under Rudd might have in mind in terms of economic policies. One could be forgiven for expecting so, considering that the title of Bowen’s speech was “Labor: Managing The Economic Transition“.

Now I grant you, unlike any appearance of Wayne Swan on TV, I was able to quite easily watch all of Bowen’s speech without feeling an immediate boiling of the blood and red mist descending. So that’s something to be said for our erstwhile new treasurer.

Shame then, that nothing good can be said for the content of his speech.

Indeed, it would appear Labor’s grand economic plan is to copy Cyprus and Iceland, by turning Australia into a “financial services centre” (my bold added):

The estimated net contribution of the resource sector to real GDP growth is expected to fall – from contributing to roughly half of Australia’s economic growth over the past two years to around a third by the end of the forecast horizon.

The production phase of the resource boom will also be significantly less labour-intensive than the investment phase.

This brings me to the second transition we face.

That transition is to growth being driven by the non‑resource sectors.

It’s not surprising to see Treasury forecasting that the non-mining economy will make a larger contribution to Australia’s economic growth.

These transitions will occur inevitably.

The question is: will they be smooth or bumpy? Will the Australian economy benefit from them or suffer?

Our challenge is in improving our productivity and competitiveness to assist in this transition.

This is the key economic challenge for the next three years – and lies at the core of Labor’s positive plan to promote competitiveness to spur jobs and investment.

This will mean working with the manufacturing and services sectors to promote investment.

I’m not talking about picking winners or subsidies – I’m talking about breaking down barriers to competitiveness.

What we’re doing in financial services is a good example of what can be done.

Financial services

The financial services sector has seen incredible growth in the last 20 years and it is this growth that we need to harness.

Despite the strength of the local industry, our exports and imports of financial services are low by international standards.

There is a great opportunity for the financial services industry to become more outwardly focused.

Encouraging competition and efficiency would improve the range and choice of financial products available to consumers and promote increased exports of financial services.

Improved economies of scale would reduce the costs of financial products for Australian consumers and businesses.

As our track record shows, only Labor is interested in taking advantage of these opportunities.

In 2009 and 2010, it was pretty unfashionable for Governments around the world to announce that they wanted to promote financial services.

But in January 2010, as Minister for Financial Services and Superannuation, I released the Australian Financial Centre Forum’s report on Australia as a Financial Centre – the Johnson Report as it became known – and four months later, the Government started implementing the key reforms.

Stages 1 and 2 of the signature reform – the Investment Manager Regime – have passed the Parliament.

We have taken steps to create a deep and liquid corporate bond market in Australia. Legislation to simplify corporate bonds issuance has passed the House of Representatives.

The Government has passed legislation to enable the retail trading of Australian Government Bonds.

And the Government recently announced that Australia will be the third major currency in the world to be able to trade directly against with the Chinese Renminbi, after the US dollar and the Japanese Yen, in China’s foreign exchange market.

Why have we done this?

Because Labor knows that increased trade in financial services will increase Australia’s growth prospects and standard of living.

We know positioning Australia as a financial services centre in the region means that we would be able to offer increased job opportunities for a range of skilled workers in the financial sector.

And there is potential to do so much more.

Yes, I can just see all those tradies coming back from the mining construction boom, shedding their Consciences, donning white collared shirts, and learning how to become peddlers of usury products.

Aspiring to be a “financial services centre” is nothing more, and nothing less, than aspiring to copy the economic model of Iceland and Cyprus, both of whom enjoyed an initial “boom” from doing this.

Followed by another one.

If this is what Labor have to offer in terms of “managing the economic transition”, then we really are in deep, deep doo doo.

A final comment.

It is interesting to this blogger to note the complete absence of criticism of Bowen’s speech in the mainstream press, either yesterday or today.

Bowen’s speech contained no indication of Labor having any other new economic policy initiatives. None whatsoever.

A “financial services centre for the region”. That is the great Labor plan, or so it would seem.

After what we have seen happen to other small nations that embarked on this same path, what we should have seen is the media tearing strips off Labor.

Instead, if anything, what we have seen is muted applause.

Methinks the economic commentariat’s left-leaning slip is showing under their skirts.

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Big Banks Call For Government To Raid Your Super To Give To Them To “Save The Mining Boom”

31 Mar

Well, no. That’s not exactly what they said.

But if you have the ability to look beyond the end of your nose; if you have seen that governments across the “developed” world have been stealing their citizens’ super to prop up their own and their banks’ finances; if you have seen the dire state of the Federal budget; and if you have seen the sneaky policy quietly introduced by the Liberal Party, and now implemented by the Labor Party, then the unstated implication is clear.

Some day soon, a tapped out Australian Government – whether Labor or Liberal – will “borrow” your super to give to the banks.

In our “national economic interest”.

In the opinion of your humble blogger, this is as clear and as inevitable as the rising of the sun on a crisp cloudless morning.

The rays illuminating this truth have been faintly flickering over the horizon, ever more brightly, for well over a year.

Now, it is dawning.

The only question is this – Who is awake early to see it?

From the Australian (emphasis added):

Funding shortfall threatens resources projects

THE economy’s ability to reap the full benefits of the once in a generation resources boom is in jeopardy, with major projects facing a funding gap as more foreign banks leave the Australian market and local lenders struggle with ongoing turmoil in financial markets.

The big four banks all warn that a record pipeline of hundreds of billions of dollars worth of resources-related projects cannot be met by the banking sector alone while it is being crunched by current economic instability and is being forced to raise its capital levels to comply with new global banking rules.

A range of submissions from the major banks to a Productivity Commission inquiry into the future of the Export Finance and Insurance Corporation (EFIC) show the banks are worried the funding shortfall is set to worsen.

There are fears that a funding gap will exacerbate the “hollow nation” notion that Australia is not capitalising on the boom.

Oh dear! Where to begin?

On the one hand, there are many (including your humble blogger) who have cogently argued that both the Treasury Secretary’s and RBA Governor’s economic policy settings are deliberately geared to hollowing out the rest of the economy to “make room” for the mining boom. Both Treasury and the RBA have openly admitted this. Their deliberate high AUD policy is the most disastrous example. But now, the new claim is that the Big Banks need an extra source of funding, or else the nation will be hollowed out by not maximising a mining boom?! Orwell would be proud.

The biggest bank, the Commonwealth, predicts that the number of banks lending in the Australian market will shrink further.

Translation: We know that Wayne has made “increased bank competition” a mantra, hoping to placate voters’ anger; what better way to pitch for government “help” than to warn (threaten) of a future with reduced competition.

National Australia Bank’s group executive of wholesale banking, Rick Sawers, said there was a risk that funding to the resources sector could become constrained, which would ultimately hold back the sector’s growth.

“As project capital costs have increased, particularly in the infrastructure and natural resources sectors, maximum individual bank exposure amounts are being tested,” Mr Sawers said.

He said “additional sources of capital” were required.

Mr Sawers said Australia needed to ensure that international sovereign wealth funds were encouraged to invest in the local market.

The banks argued that there was a role for EFIC to provide funding to ensure export-oriented projects could be developed.

So if it is true that the big banks are going to have difficulty accessing enough money from overseas to finance Wayne’s oft-touted “massive investment pipeline” in mining, where do you think the extra money is going to come from?

If investment by international sovereign wealth funds in Australia’s mining boom was such an obvious winner for them, there would be no problem, and no need to “encourage” them, now would there?

There is another “sovereign wealth fund”, that could more easily be “encouraged” by government to “invest” in the Big Banks.

Consider: What is by far the biggest pool of “savings” that could be quickly and easily tapped, by a tapped out Federal Government?

Why, the fourth largest retirement savings pool in the world, of course! The $1.3 Trillion in Aussies’ combined superannuation savings. The pool of funds described by Minister for Superannuation and PM-in-waiting, Bill Shorten, as “our” “sovereign wealth fund”, a “significant national asset” that “strengthens our financial sector“:

Superannuation is our sovereign wealth fund

This week marks 12 months exactly since the government announced plans to take compulsory superannuation from 9 per cent to 12 per cent.

… our superannuation savings place Australia fourth in the world. Its $1.3 trillion in funds under management through superannuation significantly boosts national savings and provides greater retirement security for millions of Australians. Superannuation is also a significant national asset because it strengthens our financial sector.

It is the same pool of funds that Gillard has already tried “encouraging” to invest in government “infrastructure projects”, like the NBN –

The Gillard government’s 2011-12 budget has proposed a raft of initiatives aimed at encouraging superannuation fund and private investment in infrastructure projects.

Drip.

Drip.

Drip.

Back to the Big Banks’ veiled threat:

Westpac warned that the major Australian banks were already facing “considerable pressure” because of large resource-related projects and the ongoing squeeze in global financial markets, while other funding sources “cannot meet the demand for funding created by the historically strong project pipeline in Australia at present”.

…

ANZ said an estimated $109bn in debt would be needed to finance projects this year and Germany’s Deutsche Bank said the impact of the global financial crisis was still being felt four years on as banks were forced to restrict their lending.

…

The banks’ warnings are contained in new submissions to Julia Gillard’s chief micro-economic adviser in a bid to convince it to reverse a recommendation that EFIC be cut back.

The Productivity Commission has accused EFIC, the government’s export credit agency, of handing out damaging subsidies to big exporters.

Now do you understand why the ALP government has passed legislation to increase the compulsory superannuation levy on employers by 33.3% – from 9% to 12% – and is using the blatant lie that the mining tax will pay for the increase to smear over the truth, that it is small business who will wear the extra cost, even though the Treasury and RBA’s policy settings are already sending small businesses bankrupt in record numbers?

Now do you understand why Tony Abbott claims that he does not support the superannuation increase, but has refused to repeal it on becoming PM?

Make no mistake, dear reader.

That is the new dawn coming over the horizon.

What has already happened in countries like the USA, UK, France, Ireland, Portugal, Poland, Hungary, Argentina, and many more, will happen here too.

It is just a matter of time.

For more, here is a selection of previous articles, in reverse chronological order:

Grand Theft Super – A Very Subtle Form Of Theft

Another Government Raid On Citizens’ Super

It Has Begun – Labor Steals Liberal’s Idea To Steal Your Super

“And Now They’re Coming For Your F***ing Retirement Money”

Stealing Our Super – I DARE You To Ignore This Now

Money Morning Agrees – Your Retirement Savings Under Threat

Now The UK Government Is Stealing Super Too

US Treasury “Borrowing” Of Federal Pensions Brings Theft Of Private Pensions One Step Closer

Liberal Party’s Sneaky Plan To Steal Your Super To Pay Labor’s Debt

No Super For You!!

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False Profits: Confusion At RBA And Treasury

8 Mar

March 2, 2012:

RESERVE Bank of Australia board member John Edwards today said the country’s mining boom will burn bright for the next decade, but will then slow to more average rates of growth.

A decade, you say?

February 23, 2010:

[RBA Deputy Governor] Mr Battellino was uncertain about how long the current boom would last, but said past booms had lasted around 15 years.

“On this occasion, the growth potential of countries such as China and India suggests that the expansion in resource demand could continue for an extended period…

15 years, you say?

February 17, 2010:

“I am quite optimistic that story has some decades to run and that underlies much of the positives for the Australian economy,” [RBA Assistant Governor Phillip] Lowe told an economic development forum in Sydney.

“It is going to be a good 20 years for China and us,” he said.

20 years, you say?

Well, what sayeth our Treasury department, the massively overpaid public servants that teach their trained parrot, pollie Wayne Swan how to repeat his daily lines?

October 23, 2009:

[Now former] TREASURY chief Ken Henry has outlined a golden age for the Australian economy lasting to 2050 and beyond, as rapid population growth and Asian demand for resources bring a sustained surge of global investment.

“While the global financial crisis has taken some of the heat out of our export prices, we should get used to the idea that we could have structurally higher terms of trade for some time, possibly for several decades,” he said.

In a speech at the Brisbane University of Technology, Henry said Australia’s population will grow as the mining boom, fuelled by demand from China and India, will continue to bring in immigrant workers. Handled correctly, he said, this could provide a “period of unprecedented prosperity”.

Henry pointed to growth in several Asian countries, which he said will give a boost to the mining boom that will see it last for several more decades into 2050.

40 years, you say?

What sayeth the new Treasury secretary, Martin “Mini-me” Parkinson?

June 3, 2011:

New Treasury secretary Martin Parkinson says only revolutions or mass war across the globe will stop the mining boom.

…

Under questioning from WA Liberal Mathias Cormann about Budget forecasts for the terms of trade, Dr Parkinson said the Federal Treasury was being “conservative” in its assumptions of a gradual fall over the next 15 to 20 years.

The Treasury boss conceded the department had erred in not accurately predicting the pick-up in commodity prices from 2003. But the department was now convinced that a transformation was occurring that would benefit Australia in the long term.

Only a major global event could prevent prices remaining high.

Good call Martin. Had a look at the RBA’s Chart Pack, showing the +30% fall in commodity prices that began just 3 months after your “conservative” prediction?:

So, which one is it, O High and Mighty Ones?

40 years?

20 years?

15 years?

10 years?

Until there are “revolutions or a mass war across the globe”?

Or, have the benefits of the boom peaked and begun to fall already … and you have all missed it, again, in exactly the same way that you missed the pick up in commodity prices from 2003?

November 10, 2011:

THE benefits of the mining boom have peaked, with the industry no longer boosting growth or improving the lot of Australians, a new study says.

Prepared by former Reserve Bank board member Bob Gregory and Peter Sheehan, a former head of the Victorian Treasury, the report calls on the government to abandon its promise of a budget surplus next year and calls on the bank to cut interest rates several more times.

…

During its first eight years, the mining boom delivered increasing net benefits, the Victoria University study said.

The rise in the exchange rate lifted household buying power 18 per cent as the price of imported goods fell.

But the dollar had since stopped rising, removing the downward pressure on prices.

[TBI: this remains true; the AUD:USD x-rate rate has not returned to the $1.10 level reached in late July 2011]

During the first five years, mining share gains pushed up real estate prices and lifted household wealth at three times the usual rate. But share prices were now well down, house prices were falling and many of the big new mining projects are completely foreign owned. Always present, the negative impacts are now dominating. Professor Sheehan told The Age neither Treasury nor the Reserve Bank should be blamed for missing the slowdown at the time of the May budget. But circumstances had changed.

#JAFA’s.

What more can one say?

P.S. If you found this blog interesting, you may also enjoy these:

Why Would Any Sane Person Believe Treasury’s Carbon Tax Modelling When Its Budget Forecasting Record Is This Bad?

The Pricing Carbon Choir – Why Should *Any* Sane Person Trust Economists After The GFC?

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Swan: Not Drowning, Waving

19 Jun

No, no … everything’s fine!  Really it is!  Just peachy!!

From AAP via Yahoo!7 News:

Economy strong despite global woes: Swan

Treasurer Wayne Swan says Australia’s economic prospects remain strong despite uncertainty about the recovery in the global economy.

Mr Swan said proximity to Asia would continue to fuel the national economy.

“Australia remains well positioned to benefit from robust growth in our region,” Mr Swan said in a statement on Saturday.

“Strong demand for our commodities is underpinning an unprecedented pipeline of business investment, with ABARES estimating a pipeline of $430 billion in resources alone.”

Australia’s economic prospects “remain strong”, ‘eh?

We are “well-positioned to benefit from robust growth in our region”, ‘eh?

An “unprecedented pipeline of business investment”, ‘eh?

Macquarie Bank begs to differ.

As does Michael Byrne, head of Linfox Logistics.

As does Nouriel Roubini, the economist made famous for predicting the GFC.

And many more.

Ever reliable Wayne Swan. Nothing changes.

Same hot air, every time.

Just remember to bookmark this page.

For the day fast approaching, when Wayne’s waving turns to drowning.

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Macquarie Bank Shreds Labor’s “Truly Extraordinary” Budget Growth Forecasts

17 Jun

Not wanting to recap the insult to intelligence that was the May Budget. But when one comes across a critique from Macquarie Economic Research that so comprehensively rips to shreds the Government’s all-important economic growth forecasts, one feels strangely compelled to share it.

You can read the entire paper here, but following are the choicest morsels (emphasis added):

Could Australia’s policymakers be too optimistic on our growth forecasts?

Upbeat growth forecasts from the Treasury and the Reserve Bank of Australia (RBA) are based on very optimistic forecasts for private sector business investment. But, if the RBA’s investment forecasts are too optimistic, not only will investment be weaker, but so too will consumption and housing, as weaker growth results in less income growth and declining confidence. This would not only mean that tighter policy was not required, but even that current policy settings could be too restrictive.

But hang on … wasn’t it only a couple of days ago that our blithering idiot RBA Governor was out spruiking the case for hiking interest rates even more?

The RBA and Treasury forecasts for business investment over the next couple of years are truly extraordinary. Treasury expects non-residential construction to double by mid 2013, while the RBA forecasts are predicated on mining investment doing the same thing.

To put this in perspective, the expected lift in mining investment is equivalent to doubling new housing construction from 150,000 units per year, to 300,000 dwellings in the next two years. Another way to look at this is that the value of mining investment in the next two years is expected to be the same as all the mining investment that took place between 1989 and 2006.

Seven years worth of all-time record high mining investment … in just two years?  Perhaps we should give them credit for positive thinking.

But is it realistic thinking?

In our opinion, achieving such stratospheric growth would be extremely difficult.

We’ll take that as a polite “No”.

For example, during the largest mining investment boom in Australia’s history, investment increased from about one per cent of GDP to three per cent of GDP. That is, it took five years for mining investment to increase by two percentage points of GDP. Now, the RBA and Treasury expect mining investment to rise by three percentage points of GDP over a couple of years.

Has anyone mentioned to the #JAFA‘s in the RBA and Treasury, that the economist who gained most fame from predicting the GFC has now predicted a “perfect storm” for the world economy “by 2013 at the latest”? And said that he expects China’s economy to have a “hard landing”?

By putting all their eggs in the mining investment basket, policymakers appear to have no Plan B for what will support the economy if investment disappoints. And this note provides three clear reasons why one should be cautious about counting those mining investment chickens before they are hatched.

Pretty much exactly what Senator Barnaby Joyce has been saying  from Day 1.

That we can’t rely solely on selling “red and black rocks” at record-high prices forever; that we need to become “more self-reliant”; and that we need a “contingency plan” against economic dangers from abroad.

So Wayne, about that “forecast” for a single year of budget surplus in 2013?

~ crickets ~

You’ve had your lackeys in Treasury cobble together a budget chock full of utterly unrealistic growth assumptions, hoping to keep the media and the great unwashed masses docile and con-fident in your economic management, right?

And then, when you make a pigs breakfast of it again, you’ll just fake up the actual growth numbers down the track, right?

Just like before … right? (see “Labor Fakes GDP By 4.5%” )

This economic forecasting game is too easy.

So before you dispose of those pig entrails … can anyone play?

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Eastern Australia “In Deep Recession”, NSW & VIC Manufacturing “Stuffed”

14 Jun

What everyone with boots planted firmly on the ground already knows.

Which is exactly why our policians and mainstream media (seemingly) do not.

From Business Spectator:

Eastern Australia is in “deep recession” and the NSW and Victorian manufacturing industries are “stuffed”, the head of Linfox Logistics says.

Fresh from making a $68 million property acquisition in the mining boom state of Western Australia, Linfox Logistics chief executive Michael Byrne has dismissed suggestions the nation is dealing with a two-speed economy.

“It’s a parallel universe that bears no relation to anything else on this planet,” he told an American Chamber of Commerce event in Sydney on Friday.

“If you look at the world, eastern Australia is in deep recession, in my view, as is New Zealand.”

WA was driving the national economy and Asia was a “different place again,” Mr Byrne said.

“If we didn’t have mining, Australia would be like Portugal, Spain, maybe Greece and Ireland,” he said, referring to European debt problems.

Mr Byrne is right.

Referring to our near-total dependence on selling “red and black rocks”, Barnaby has warned the spendthrift Green-Labor Alliance … “God help you when the prices go down”.

God help us all.

Barnaby is right.

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Barnaby: “God help you when the prices go down”

18 May

Senator Joyce rips into the government’s economic “plan” this morning:

Opposition frontbencher Barnaby Joyce has taken a swipe at the Gillard government’s approach to the economy, saying it had an unbounded belief in Asia’s demand for Australia’s resources.

“God help you when the prices go down,” he told reporters in Canberra on Wednesday.

The government’s approach to economics was “a clever ability to charge people to dig up red and black rocks“.

“They (government) have an unbounded belief that the people in South-East Asia will have an eternal gratitude to pay an excessive price for red rocks and black rocks.”

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Swan Hides Budget Risk

17 May

Well done Michael Stutchbury.

But you’re not forgiven until you retract the smear. And join the chorus now recognising that Barnaby was right about the risk of US debt default.

From The Australian:

The confused reaction to Wayne Swan’s budget stems from its refusal to properly spell out the risks of relying on Australia’s China-fuelled terms of trade remaining close to their 60-year or even 140-year highs.

This commodity price bonanza has delivered eight years of tax cuts, a big expansion in middle-class welfare, billions of dollars of wasteful spending – and this year’s $50 billion budget deficit.

Yet all our previous commodity export price spikes have swiftly reversed, typically ending in double-digit inflation and recession.

A must read.

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Bloomberg: ‘Down Under Hypocrites Bet All On China’s Boom’

13 May

Bloomberg savages the hypocrisy and incompetence of Labor’s budget:

All in.

That’s essentially the message Treasurer Wayne Swan is sending about Australia’s odds-defying bet on Chinese growth. The government’s latest budget pledges to deliver the quickest improvement in the nation’s finances on record — without specifics about how that will happen.

The absence of such detail is telling and can be boiled down to one thing: an even bigger gamble on China’s 10 percent growth and its voracious appetite for Australia’s resources. It’s risky to so fully hitch the hopes of 23 million people to a single nation that’s still developing.

Hypocrisy was in the room last month when Australia rejected a Singaporean offer for its stock exchange. Swan called slapping down Singapore Exchange Ltd. (SGX)’s $8.8 billion bid for ASX Ltd. a “no brainer.” The whole shareholders-come-first vibe that pervaded before the global crisis lost its oomph among voters.

The debate distracted attention from a far bigger takeover happening by stealth: China’s designs on all things down under. Down under the ground, that is.

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Costello: Wayne’s World A Parallel Reality

28 Apr

Peter Costello has stepped up with some hard facts and figures to debunk the Goose’s latest myth-making efforts.

From the Sydney Morning Herald:

Five years ago the prices of Australia’s exports began rising sharply. The price of iron ore hit about $US30 a tonne and thermal coal about $US50. Australia had not seen export prices like that in a very long time.

The federal government was running budget surpluses. It had paid off its debt so it established a sovereign wealth fund – the Future Fund – to save for the future. This was to prepare for a time when things were more normal and to cover the costs of the ageing population. About $60 billion was deposited into it.

…
This year the iron ore price is nudging $US170 a tonne (about five times what it was when the Coalition was ”wasting” the boom) and the coal price is about $US130 (nearly three times the price of five years ago). If you look at a graph of historical prices, we are at the peak of Mount Everest. The rise of 2006 looks like Monticello – a small rise visible only because conditions were quite depressed before it.
The Reserve Bank’s index of commodity prices shows an all-time high in March 2011. The index is nearly double where it was in 2006 and triple the levels of the late 1990s. Adjusting back into Australian dollars it rose 32 per cent in the past year.

And mining profits are super strong. In 2006, BHP’s profit after abnormals was a massive $10 billion. This year it reported that profit for just the first half-year.

…

Since it was apparently wasteful to run budget surpluses, build a savings fund and cut tax in 2006, Swan could show us how things should be done now we are in a real boom. He could, but apparently he will not, because last week he gave a pre-budget speech lamenting how hard everything had become and saying that we should not expect too much, not even a balanced budget in May, let alone a substantial contribution to the Future Fund. And although he has found a way of sharing the pain of the Queensland floods with a flood levy, we should not expect to share the prosperity of the mining boom through any tax cuts.

There is reality. And then there is Wayne’s world.

In Wayne’s world a boom is something that happens to others, not to him. In his world, others find rivers of gold, but for him the river never rises.

In Wayne’s world, Labor is a superior economic manager which runs into bad luck all the time, while Liberals are poor financial managers who waste opportunities and somehow get good outcomes when the dice fall their way. It’s a weird place inside Wayne’s world.

Costello’s depiction of Wayne Swan as living in a “Wayne’s World” parallel universe has some rather interesting and ironic … parallels.

In the movie Wayne’s World, our hero Wayne falls in love with Cassandra Wong, a Chinese-American lead singer for a heavy metal band.

In our real-life version of Wayne’s World, our hero Wayne has fallen in love with “Cassandra Wong”, the Chinese-American buyer/s of 73% of our 189+ Billion sovereign debt.  This “Cassandra” has sung a tune about an endless China boom, promising decades of heavy metal-fuelled prosperity for Australia as a result.

And Wayne has fallen for her siren song.

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