The Rudd years gave us the trifecta of bad leadership, Rudd, Swann (Treasurer) and Stevens (RBA Governor).
Have we got any better now? Turnbull; we’re still waiting to find out how he is going to shift our 10% underemployed to jobs. Remember his predecessor, Abbott, was going to be the infrastructure Prime Minister but never delivered infrastructure jobs. When is Turnbull going to take action?
Morrisson – Our Treasurer.
Like Swann, Scott Morrisson has decided also for the first time not to force banks to pass on rate cuts. Why? This was done successfully for decades by the banks. Since Swann and now Morrisson, they are sitting on a whole 1% of reductions that they haven’t passed on because they enjoy a monopoly.
The chart on this is freely available on the Reserve Banks own website under its monthly chart pack.
I am concerned that Morrisson has fallen under the spell of the greedy bureaucrats of the Treasury. These career public servants are always wrong. That could explain why Morrisson returned from his overseas trip to lecture our bank not to lower rates. “Lowering rates has not helped overseas economies”. This may be the view of Treasury but how do they explain the fact that in the US their low rates have halved their unemployment while in Australia our high rates have doubled our unemployment??
Morrisson has returned from Europe and America where they are now climbing out of recession and the low rates are stimulating the economy. Morrisson is in Australia where we have the reverse. As we have argued before, Australia is in the grip of a credit squeeze. For the first time in our history, this was not brought on by an elected government trying to cool an overheated economy. This time, it was brought on by a banking monopoly urged on by an ignorant APRA and RBA with its long history of having a failed crystal ball.
I know from personal experience that Morrisson is not aware of this credit squeeze but even worse, he has refused to take this notion on board. Once again, the evidence is clearly available on the RBA’s website in its latest chart pack on credit supply.
So where does it leave the future of Australia?
With a Treasury leaving the running of the economy to an ignorant uninformed, unresearched APRA policy we can’t see the jobless situation improving. This will, however, bring the media or perhaps the MPs to alert Turnbull to the situation. The question then will become, can he change the mind of a Treasurer under the spell of Treasury?
My concern here is that our MPs seem to be mollycoddled or put in mothballs by the banks. These MPs floundered around trying to ask the penetrating question of the banks. They clearly were unaware of the cash grab by the banks to satisfy APRA’s call for them to have more cash. This of course, like a nomad business, should have come from their shareholders. But when you become a monopoly you have the advantage of being able to screw your customers.
Our MP’s are aware of this. Our MP’s are aware that interest only loans were suddenly jumped up to principal and interest to increase the repayments 40%. They were aware that 15 and 20-year terms were reduced to 5-10 to again jump up the cash that was available to take from you and me. All this leads to less money flowing around the community creating real jobs.
As usual, this will be left to private industry to climb over local, state and federal red tape to increase employment. The firepower to increase jobs would be greater if the Senate passes the government’s plan of lower taxes for smaller businesses. Perhaps in the upcoming vote on marriage equality there should be other items to vote on and one of them could be the abolition of the Senate or another one, if not removal of its right to veto bills but only to suggest amendments and send them back to the House of Representatives so that the government can get on with actually governing.
What do you think?
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