photo credit: Ananda Sim 88The credit crunch is being blamed for stopping Australians from flocking to France for an Anzac Day dawn service honouring World War I diggers who fought on the Western Front.

About 5,000 people turned out last year at the Australian National Memorial near the rural town of Villers-Bretonneux for the first ever dawn service held in honour of the diggers.

But tour companies this year have reported a massive drop in demand for organised Anzac Day trips to Villers-Bretonneux, which lies in the heart of the Somme, 150km north of Paris.
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A New Zealand-born financier who threw himself under a train as the credit crunch worsened had spoken of committing suicide when the banking system started to collapse, an inquest has heard.

Kirk Stephenson, a 47-year-old chief operating officer at private equity firm Olivant, died instantly when he was hit by a train at Taplow station in Buckinghamshire, west of London, on September 25.

Stephenson, who was also known as Ross to those close to him, arrived in London in 1983.
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The global credit crunch and liquidity crisis has entrenched the dominance of Australia’s big four banks and left non-bank lenders and mortgage brokers battling just to stay afloat.

Figures from the Australian Bureau of Statistics show mortgagors have flocked to the banks in the past year, with non-bank lenders’ share of the market falling to 11 per cent in 2008, from 19 per cent in 2007.

The majority of those switching over have gone to the big four banks - ANZ Banking Group Ltd, Commonwealth Bank of Australia Ltd, National Australia Bank Ltd and Westpac Banking Corporation.
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Share market slides, tight credit conditions and faltering demand will weigh down Australia’s economic performance in coming months, a report says.

But the economy is not expected to be in a worse position than in the aftermath of the millennium tech wreck of seven years ago as the Reserve Bank of Australia (RBA) delivers more rate cuts.

The Westpac-Melbourne Institute leading index, which measures the likely pace of economic activity three to nine months into the future, has fallen to its weakest point in six years.
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For years Steve Keen, Associate Professor at the School of Economics & Finance, University of Western Sydney has been warning everyone who would listen that the massive global “debt bubble” would result in financial crisis.

The ratio of private debt to GDP is now more than double the level that triggered the Great Depression and as the international credit crisis spirals out of control Keen has been vindicated.

Continuing to march out of step with the majority of conventional economists Keen argues that Hank Paulson, US Treasury secretary’s US$700 billion bailout plan is nothing more than “a short-term salve” and that it won’t be long before the system starts collapsing again.
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Former prime minister Paul Keating says there are marked differences between the current global financial crisis and the economic problems experienced during his time in office.

“What we’re seeing at the moment is the disintegration of the international financial system,” he told ABC Television tonight.

“That’s not what we had in 1990. We had a world recession in 1990, it was a business recession, that means business investment fell.

“What we have here is the advanced disintegration of the international financial system.”
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Shake your partner vigorously by the shoulders and scream: “For Gordon Gekko’s sake, don’t panic!”

That’s step one to riding out the current global financial storm.

Here are a few more practical suggestions culled from what the experts are saying:

• Shares: OK, so on the bad days some of them seem to be worth less than the money on your Monopoly board. But think twice before selling. Full Story

The prudential regulator has warned the big banks to scrutinise their overall loan exposure to financial companies and their satellite funds as turmoil continues on global markets.

The Australian Prudential Regulation Authority (APRA) is concerned the banks may be treating loans to companies such as Macquarie Group, Babcock & Brown and Challenger Financial and their listed funds as separate exposures, as this could allow the banks to avoid reporting them to the regulator, The Australian Financial Review reports.
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The ever-deepening global credit crisis could impact interest rates locally, Treasurer Wayne Swan said, hours after the US House of Representatives rejected a $US700 billion ($A845.67 billion) bailout.

The financial package was rejected overnight, sending Wall Street into a panic and driving the Dow Jones down a record 777.68 points, or 6.98 per cent.

Australian markets are expected to take the US lead and suffer a tough day.
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Prime Minister Kevin Rudd says the opposition’s decision to block various measures contained in the May budget could put at risk the government’s ability to meet the various challenges facing the economy.

Mr Rudd said today the economy faced numerous challenges as a result of various global factors such as the credit crunch and rising oil prices.
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Nearly half of Australian businesses have been affected by the fallout from the global crunch but the worst could still be around the corner, a credit insurance company says.

Atradius Australia and New Zealand managing director David Huey said payment defaults and insurance claims reported to his firm had doubled since last year.
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Construction industry hopes have suffered a blow, with Master Builders Australia’s National Survey of Building and Construction revealing the fourth consecutive fall in builder sentiment in the June quarter.

The Master Builders Building and Construction Index has fallen below 50 for the first time in four years, indicating that builders now expect a decline in building and construction activity.
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The credit crunch has seen an unprecedented fall in the availability of funding for mortgages all around the world causing many lenders to shut up shop and batten down the hatches.

What has this meant for you? Brokers, lenders, mortgage managers or anyone at the coal face of this liquidity meltdown - tell us your story by commenting below.

Wizard Home Loans chairman Mark Bouris is adamant he is not bidding for the business he sold to GE Money four years ago and it is now back on the auction block.

Mr Bouris and GE Money’s Australian head Mike Cutter spoke to Wizard franchisees today, updating them on a review of its ownership structure.

The review will canvass options including a complete sale, or moving it into a joint venture structure or GE taking on a strategic partner. Full Story

Turmoil in world markets has forced Macquarie Group Ltd to concede for the first time in more than a decade that its annual profit could be about to shrink.

But Australia’s biggest investment bank said its model of borrowing relatively large amounts of money to buy infrastructure and property assets was not being threatened by a global credit crunch. Full Story