A brief mention that the RBA is doing the right things [youtube]http://www.youtube.com/watch?v=1UgY8jaoDto[/youtube]
Yeah, I love the RBA Yes they are better than most of the other rotten, diseased fruit loop central banks in the world (which I think was Roger's point) but at the end of the day they still an irrelevant, irresponsible damaging and inevitably poisonous institution that needs to be abolished.
They're only a two trick pony (or three if count propaganda speech). On a side point, is there any way of splitting out the portion of the blue line that is tapped for small business purposes (I'm guilty of this)?
The "business" portion of almost all the finance breakdowns I've seen is bulls**t, so probably not. You'll see the MSM stating something like "commercial loans were down as businesses became more cautious over the last quarter" but for every billion dollars Macquarie Bank decided to not to borrow so they don't put their bonuses at risk there are thousands of small businesses out there that would be investing in new opportunities if only their banks would let them. Banks in this country have simply forgotten how to lend money against anything other than residential real estate so there isn't really much point in classifying something as a "business loan" if the only way the borrower obtained the money was by putting their own house up as security.
No, but they should have helped it already. The way I see it, they're like other central banks - continually trying to have their cake and eat it. That is, a functioning economy and a stable currency. Ultimately they'll end up with neither, because their strategy amounts to 'hope and pray everything will be ok'. What we 'need' is structural soundness in our economy, but that will only come after the financial cancer is purged. But they're just prolonging it, like other central bankers. I guess they think their mandate really is to keep the status quo. When the SHTF in Australia and the RBA panics and drops rates, foreign capital will leave our shores very quickly, compounding our woes. I'm a believer in controlling my own destiny, so the right action to take would be to strategically pre-empt the capital flight and force Australia into a self-made recession. It's the only way we'd become strong enough to avoid a depression. But it would take Govt and RBA cooperation and political nerves of steel (and foresight), which we are severely lacking.
bordsilver - I've asked this question of a banker (mid level manager) mate of mine a while back. The blue line should be representative of residential mortgages only. ie regardless of the security of the loan if it is for business it is classed as a business loan. So not definitive but I fully expect to see bank lending for private use to be far in excess of business usage so the graph looks right. In saying that though I would not be surprised to see lenders playing funny business with the figures.
The way I look at is there was an opportunity to put the world on a stable footing at the end of WW2. That was the only time where you were basically starting from scratch. Entrenched interests at the time prevented it and we've just been band-aiding things ever since all the while the cancer has been continually growing. Another World War, god forbid, would just end up the same way I think although we would probably get a few good decades after until the underlying fundamentals had time to deteriorate enough.
elections, elections, directions, erections, directions elections..........i know why jim could be a bit confused with young elizabeth......"and problems could be worse in the long term".......hahahaha
