Greg October 23, 2009

The only thing Swan and Dudd are champions of is Spin and the media have fallen for it hook line and sinker.

What goes around comes around and the cracks are starting to appear especially with the fiscal waste and new throw away spending on the Indonesian “ANSWER”….

Michael October 23, 2009

It would seem the vast majority of Australians don’t agree with you, Greg. What is one person’s “fiscal waste” is another persons investment in the Australian people.

Milton October 23, 2009

What crap? If it had not been for the good financial health of Australia then Dudd & Swanney would not have been able to offer the level of stimulus made available. We now owe so much and it will grow for future generations particularly when the China & India demand for raw materials retreats

Joe October 23, 2009

Just because the majority of Australians don’t agree with Greg doesn’t mean he is not right. The majority of all the so called “experts” could not see the global financial crisis coming and the few that did were laughed at. Those who did the laughing now are gorging themselves on “humble pie”. The only way to run a “possible” creditable survey on this subject is to survey the appropriately qualified economists and see what the percentages are then. Even so as with the GFC this could be wrong as well. The public are exposed daily to biased information anyway by the veritable “kings of spin”, the media and politicians.

Greg October 23, 2009

Michael, Michael Michael….
When you sell someone a mortgage, you either hope they know or you teach them how to use it. Then the banks load them up with credit cards and car loans…. Happy Holidays!!
It usually takes around two to four years and WHAMMO. Nobody told me I couldn’t Afford it Mummy!!!!
Find me a Public Servant that knows about money and debt and and I’ll give the game away.
The Lunatics are running the Assylum.
And don’t tell me Ken Henry is a good example of fiscal expertise and performance.

Derek Miles October 23, 2009

I agree with Michael. Here is a broker critising the stimulus, but on the other hand, dispenses lending for investors - or indded First Home Owners. I bet Greg didn’t turn down any finance leads. Tell me, what is the difference? And Milton, maybe the accumulaton of surpluses and implementation of GST by Costy and How-who? got us into this mess in the first place? And why didn’t Cosy and How-who see this coming before they lost the election to the majority. I think that Rudd and Swan have done a bloody good job and only in the nick of time. Cosy and How-who were so concerned with bashing the unions and the workers who finance this country, they took their eye off the ball - didn’t they. And if Turnpost got his way, we would have over 10% unemployment and a massive recession. In fact Turnpost, like his predecessors, were so concerned with chasing the wrong bull (Ruddgate), that he too took his eye off the ball - and should have lost his job I might add.

Derek Miles October 23, 2009

And one more point for those who mistakenly believe that Costy and How-who did such a wonderful job. The only way they could create these surpluses was to tax the polulation another 10% on everything we buy. And to make matters worse, impose on the small business community a massive cost and impost to collect it for them. Yes, it was Costy and How-who who imposed GST - back in 2000. I am a Tax Accountant and I see the dreadful impact this has had on small business over the last 9 years. We are the most taxed country in the world - and only since GST.

Michael October 23, 2009

I give credit where it is due. We have had a succession of fiscally responsible governemnats over the past 30 years and are reaping the rewards. Whether one was more fiscally responsible than another is a mute point. I have never agreed with everything every government has done, but on a continum thaey have all contributed to our current position which, in the main, is being well manged. The stimulus package, prevented my business going down the gurgle but this was only possible because the previous govt built in surpluses, which was only possible because the previous govement opened our economy to the world, etc.

Derek Miles October 23, 2009

Michael, I cannot dispute your approach. However, it was Hawke and Keating who opened Australia to the world. He reformed banking (de-regulated it), he de-regulated the airline industry and the list goes on. He also floated the dollar. And opened the way to asia.

Michael October 23, 2009

Thanks Derek, that is exactly what I was saying. I still regard Paul Keating as the most influential Treasurer the country has had. Peter Costello was the luckiest, but you have to play your luck.

Greg October 23, 2009

Derek, who have you been listening to?

It happens every tim we get a labor government, they p*&@S it up against a wall and then the other mob come in and fix the mess. The only good thing you can hope for is that they balance one another out in our lifetime.
Lets do a review on Rudd in say another two years os so, about half way through his next parliament. I think I could start writing the story now…

Derek Miles October 23, 2009

Greg, I have been around for a long time. I have seen first hand.

barry parker October 23, 2009

The author of this article is an absolute idiot!The only thing Rudd and Swan have done is given the country a huge debt.

Derek Miles October 23, 2009

Barry, then why are you giving all your clients big debts? After all, it was enthusiastic lenders and brokers who got the world into such a mess in the first place. And would you still be in business if it wasn’t for the stimulus package? Did you do any first home owners loans in the last few months - funny Hey?

Derek Miles October 23, 2009

Oh, by the way Barry, I am just on my way now to see a client to do a loan because he still has his job because of the stimulus package. I don’t look a gift horse in the mouth and nor does my client. I bet he is glad that the country has gone into temporary debt to save his job for him. So am I, otherwise I would have the afternoon off - I would rather work than sit on the beach all day.

So if you gave your Rudd money to charity, then I might consider you serious. If you kept it - then you are not serious.

Greg October 23, 2009

Barry, if you think he is finished getting us into debt yet… wait a few more years until the Hoochie Cooch debt kicks in. That means the ETS scheme, Oh No, not another tax on everything.

barry parker October 23, 2009

Derek, you need to really research what has happened in our market before you prattle off. Firstly here in Australia our credit markets are best practice in the world> We did not engage in any of the bad practices that caused the GFC. The US and Europe lent money to people way outside standard lending parameters, not here in Australia. How this effected us was simply our banks used the same capital raising vehicles that the US used to rip the world off. Our RMBS’S were and are not in any doubt what so ever as we have always been best practice here. But simply we do not understand scale here. Even though we are best practice and are minimum risk we are small but tarred with the bigger US brush. The RMBS remains prohibitive due to percieved risk.

At the moment four banks get about 97% of all new business written yet there is this whole secondary finance market that suffers from inadequate funding. The federal govt make funds availavaiable through the Reserve Bank however charge the bill rate plus .7% to the majors and then plus 1.4% to the rest. Supposedly because there is a higher risk with a BBB rated bank as opossed to dealing with one of the most profitable banks in the world!! Again our credit Market here is best practice in the world. There is minimal risk. Why the penalty ?

Give some thouht to this. There is a large proportion of our society that has woken up every day since the GFC started in August 2007 secure in there income. Several years ago it was reported that 53% of our society was directly dependant on the state for their income, ie worked for the federal state or local govt,defence or social security or pension. I would estimate that figure might be closere to 60% today? Who Knows?Then there are all the industries that that supply the govt. But when you have that many people not suffering the effects of what is happening everywhere but here, then they keep on spending> Spending creates demand>demand equals employment!!We don’t suffer the same as other countries!!

We are a socilist democratic society here. We look after our own! Government is an industry here> A revenue earning enterprise and the largest employer in the country. We were never going to suffer the same as the rest of the world.

We now have huge debt and two fellows that are very good at hood winking the Australian public!!

For your information, I havn’t written a first home buyer loan as we are one the the second tier banks that suffer from the higher cost of funding > Competition ha !!

And for the record, in a survey if you ask a leading question you will always hear the answer that you want to hear!!

Barry Parker

Joe October 23, 2009

Derek it is rather surprising that as an accountant you rubbish the GST. Firstly the fairest method of assessing what people should pay in tax is the GST method. The greatest fraud or unfair tax method is the income tax method and you should know. With the latter method the “rich” pay nothing whilst the “wage earner” pays the bulk of the tax collected. These are the very people that Labour should be helping instead the harder they work the more money they hand over. Income Tax should be reduced substantially to a very small % say 10% or to NIL and all tax should be paid through GST where those who have the money to spend pay the tax as and when it is due at the point of purchase. The more they spend the more tax they pay. Those who have less to spend pay much less tax. I haven’t gone to the extent of working out figures on it (not going to waste my time on this) but GST may have to rise to say possibly 15% or the like if Income Tax were to be reduced or abolished. The only negative issue with GST is that the method used for reporting it can be a burden on business so therefore we should be spending our time devising a better method for this process.

Michael October 24, 2009

Barry, if you are going to use statistics to support your argument, make sure they are right. To suggest that 60% of Australians are directly “dependent” on the government is a nnsense. I think the staistic is that 60% of Australian receive some for of “assistance”. The buklk of that is through family allowance payments. Here in Canberra, the bureaucratic capital, the number is less than 40% as directly dependent.
I suggest you read Ross Gittens article on debt in today’s SMH, which will give you a more balanced view on debt, and Australias position re debt.

Derek Miles October 24, 2009

Thank goodness someone has brought clear thinking to this debate - Michael. Precisely, Australians generally have no problem with committing 30% of their pre tax income on debt servicing. But when the government wants to use 6% of GDP on debt servicing, the world has come to an end. The conservatives are so focused on government debt, they have lost sight of the big picture. They think that by being debt free with no investment in infrastructure that they are being sensible economic managers. Well if this is the case, then why do so many Australians borrow to invest and then on the other hand say the government should not do the same? Doesn’t make sense to me.

Savvy Investor October 27, 2009

Hi Derek Miles,

If the government was buying good business assets dirt cheap with a view to making a profit and jobs from them later I would agree with you, but giving the general population money because the want to encourage un-targetted spending is as close to pointless and dangerous as encouraging population reduction by giving everyone a loaded gun! Yes it is quick but there is a price to pay and we will be paying it for years.

US debt in total is fast approaching 3 times their GDP! If you borrow 3 times your income, you would really want to make sure you invest it in something that is worth that a great risk, and in this case you are not just betting the farm, but the whole country!

I am unsure where your figure of 6% of GDP is obtained from but I remember reading that the $300 Billion stimulus spending was far higher than that. Also whilst some of the spending (thankfully more and more) is on infrastructure that may ‘pay a dividend’ the majority is payments due to the various unions that support this government and cash bribes to ensure their re-election IMHO. Education payments to schools have been made such that they have to spend on what the government says they must not what they actually have determined they need. This is wasteful and simply creates jobs for the building industry which now is dependent on Government projects for 60% of its employment. It will not last and the cracks are already starting to show (but not before the election I am sure)…

katelyn November 15, 2009

you guys really need to get a hobby…

Derek Miles November 15, 2009

Hello Katelyn,
Where have you been for the last 4 weeks? We have already moved on to the 20th topic since this one. Been sailing all yesterday so I certainly have my hobbies. You enjoy yours.