John Howard..non-core to the core…

With much deference to Tim Dunlop, it would be remiss of us not to observe EX PM John Howard’s latest running commentary on all things political after he promised not to do so.

Mr Howard, who addressed students at the Gold Coast’s Bond University today, said the Coalition had struggled with public perception.

“Any government that’s been in power for as long as we were inevitably develops a problem with longevity,” Mr Howard told the crowded auditorium.

“We were the second-longest serving government since federation, (so) I think longevity played a part in it.”

He said Australians had become accustomed to their wealth, and faced with an alternative leader who differed from the government on only a few “symbolic” principles, deferred to the new guy.

“Prosperity in Australia had continued for so long that people rather took it for granted,” Mr Howard said.

This was a speech delivered by the ex-PM delivered today.

Anyone suspect that he might be somewhat basking in his own inherited perceptions of his own brilliance of the past, rather than focusing on the issues that confront Australians today?

Or is that just me…?

RBA cuts base rate by 1%

In a shock move, the RBA has cut the base rate by 1%.

Will be interesting to see how the markets and the major banks react to this.


Global Meltdown…is the end of the world nigh?

John Howard predicted last year that “a Labor government would result in madness and mayhem!”

However, I doubt even Mr Howard could have predicted the global economic meltdown that is transpiring before our very eyes, and obviously nor is it the cause of a change of government in the little old backwater of Australia.

The Australian share market fell by more than 3pc within minutes of the start of trading this morning, following heavy losses in global markets overnight.

The Australian dollar is also taking a hammering. Overnight, the local currency traded between a three-year low of $US0.6985 and a high of $US0.7506, marking the most volatile offshore session since the Australian dollar was floated in December 1983.  It was only 3 months ago that economists were predicting parity with the US dollar by the end of the year.

Bad luck if you’re planning to head to the US for a Christmas holiday, but then again, there may be few cheap hotel deals around!

Forecast senior currency analyst Lee Wai Tuck said the Australian dollar has weakened due to investors shying from riskier assets in these uncertain economic times.

Investor flight was exacerbated over the weekend by news of more European banks in difficulty and its effects spreading to the global economy.

There was more turmoil in European banking circles, with Germany’s fourth largest bank, Hypo Real Estate, nationalised to stop it from folding.

Beleaguered Belgian/French bank Fortis was partly nationalised earlier last week and then had 75% of it bought by BNP Paribas.

“There are concerns that this global crisis will affect more companies and more banks,” Mr Lee said from Singapore.

Banks are being nationlised in the UK, Asia, Europe and the US. 

Meanwhile, financial advisers continue to advise clients to retain their holdings in shares.

This is a once in a lifetime global economic crisis, with the recent US $700 billion bailout looking like it’s had a negligible impact.

So how are you feeling?  Should you continue to hold your share investments? Or as TB suggests is now the time to pull it all out and hide it up in the attic?

Marginally Angry

Now this really gets me annoyed at politicians.

A story on the front page of the SMH tells how the Federal Government (specifically Rudd and Swan) told NSW that they would not get any federal money for the North West Metro project because there we no votes in it. This is because the area that is to be covered by the metro does not have any marginal seats!

It does not seem to matter if the project is good for the people of Sydney. It does not seem to matter if the project is good for the environment – by moving cars off the road. All that is important is votes.

We need politicians who – you know – do things for the right reasons, not for votes.

HiPER Activity

A new experiment at a laboratory near Oxford in the UK, hopes to harness nuclear fusion where the amount of power generated is more than the power used to sustain the reaction. The story in full is here at the UK’s Telegraph newspaper.

Fusion differs from fission in that it is the combination of atoms to create new ones – which gives off massive amounts of energy, whereas fission is the destruction of atoms to create new ones.

And fusion is actually a green energy source, as the by-product is not radioactive nor does it produce any carbon emissions. If the experiment is successful it could lead to the construction of commercial power stations. IMHO, we (the world) would be far better off if we were to fund research into these sort of projects. From the article it seems that there are a number of projects occurring around the world at the moment, lets hope that one of them is successful.

After all, isn’t it better to create than destroy?

Update: Here is the link to the project’s official page